make sure you join us tomorrow. "squawk on the street" begins right now. ♪ good monday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber at the new york stock exchange after a weekend of protests around the country, financial markets, global business reacting to the president's immigration order. futures are lower ahead of another busy week of earnings and data. europe lower as well. ten-year relatively steady, that yield around we'll say 2.48. our roadmap begins with donald trump's immigration orders and the effect on american business. ceos across industries making their voices heard. on top of that we have a busy week for the market, we have a fed meeting, jobs market,

earnings for apple and amazon. >> snapchat filing as early as this week. the ball rolling for one of the most anticipated ipos of the year. but first up, the president defending his executive order restricting travel to the u.s. from those seven muslim majority nations. despite protests from around the globe, just moments ago the president tweeted, if the ban were announced with a one-week notice, the bad would rush into our country during that week. a lot of bad dudes out there. apple's ceo tim cook among the major business leaders who oppose the executive order. in a letter to employees he wrote, i've heard from many of you who are deeply concerned about the executive order. i share your concerns. it is not a policy we support. goldman sachs blankfein echoing that almost word for word today. reactions to, jim, from google, nike, reed hastings of netflix calling it un-american. >> yeah, i mean, look, i think most executives were surprised.

you look at who works for these great american companies, it's not like 1950. these companies have people from all over with various degrees of let's say stature as american citizen, whether it be green card, something that's tempor y temporary, i think people are like wait a second this isn't the way it's worked here before and i don't think they recognize that president trump has different ideas about how it's been before. what was before and what's after. and that you better get with the program. we're going to run the risk of having judges call us out. but this is the new way we do things. and i think that there's a sense among ceos that, well, wait a second, we didn't really vote for this guy. we thought he was okay. we met with him. he's not our guy. and suddenly something like this happens and they say this is such a brave new world. don't worry, employees, we got your back. it's a different narrative entirely. it's not a narrative about coming together. it's not a narrative about doing

better. it's not a narrative about lower corporate tax. >> no. >> it's about don't worry we'll protect you. >> it is always interesting to see the reaction from corporate america in terms of some of the more strident comments from reed hastings or apple very clearly saying we don't support this or lloyd blankfein, and others though not as much. amazon just saying employees you have to be aware of this, ibm. interesting to see the different approach. because of course we also have an executive in chief in the white house who's not as we know afraid to go after individual companies. >> right. right. everywhere you go you hear people -- look, i'm in new york city. and new york city is very different. there are protests on every corner. protest down the block from me. protests where there's just a sense of chaos. but then i watch squawk and they talk about how and republican representative talks about

conway and few people affected and what's the hubbub and why are you making such a big deal of it and i think it's made a big deal because it's not seen to be the american way. >> conway did say and tweeted of the 325,000 people on saturday who tried to get in or who came here, 109 detained and held for questioning. we're told today they've all been released. those are the numbers we have to go on from the administration. they're going to take 30 days to try to set up new screening procedures. but to your point, is the reason the market is lower in the premarket because corporate tax, repatriation, deregulation, all take a backseat to this? schumer today is going to ask for a full senate floor vote on trying to repeal this somehow. >> look, i think that -- i talked on friday here about political risk. political risk to the agenda. i think a lot of people who want, you know, me, jim cramer, for whatever that's worth, what do you really think here? my goal is to try to figure out what will happen to the what is

the tripod on deregulation, repatriation, lower corporate taxes. this was the political risk i think was even bigger than mexico. i'm just focusing on gop senators who i believe will break ranks trying to find out who they are. if you find there are some, you can look at earnings. earnings aren't bad. but you can't look to washington for lower -- for higher earnings per share for 2018. >> right. >> if some people break ranks. >> that list is not long of broken ranks. >> no. >> it's mccain and graham and flake and sass. >> you don't need a lot of them. >> yeah. >> you don't need a lot of them given the vote in the senate that they need even under reconciliation, you don't need too many. if you get four and the democrats stay together, which of course is a big if, then these legislative opportunities become less certain. >> right. >> and interestingly this morning the koch brothers are also reported to be massing behind a campaign to try to eliminate the border tax

adjustment as part of any tax reform. and so, i mean, it will be a war no matter what given how far ranging tax reform will be and how it will reshape industries. but the more time, the more dissension in other areas, you can imagine, it becomes perhaps a little bit more difficult to get done. but we'll see. >> right. look, if you're trying to figure out this is a big week of earnings, right? you have to look at earnings through the prism of what will 2018 look like. >> uh-huh. >> because washington could give you an extra boost. the more this happens the more you say what will 2018 look like on the numbers, not on washington. this is taking washington, the positive of washington out of the equation. >> let's bring in eamon javers on the phone with us this morning who has to get to a briefing today. eamon, a lot to watch today. as jim said all week long. what's on your mind? >> that's right, carl. good morning. let me give you a sense of what's going on right now. i'm in the white house press briefing room. and we are waiting on a 9:15

a.m. background briefing on another executive order that we expect president trump to sign at some point today. we don't know exactly what executive order this is going to be. we're expecting some clarity here in a few minutes. that's where i am right now. but the trump white house this morning has been really defending its actions over the weekend and pointing out that a lot of the protesters who were against this executive order were simply anti-trump voters all along. kellyanne conway was on "squawk box" this morning, as you guys pointed out, i think we have a sound bite keyed up of what she said. in effect saying that these protesters were just the same folks we've seen all in all. let's listen to kellyanne. >> the idea that people have protested every step of candidate trump, president-elect trump, nominee trump, president trump, president trump day two, day eight, doesn't mean that the executive order and its implementation and rollout could have been done differently.

means people will always protest especially if they're underinformed. >> we're also seeing some reaction as you guys have been talking about this morning from corporate ceos. i just got a copy of the full transcript of the voicemail that lloyd blankfein left last night for employees of goldman sachs. some of that says, if the order were to become or remain effective, i recognize that there is potential for disruption to the firm and especially to some of our people and their families. i want to assure all of you that we will work to mdisruption to minimize. you're seeing a number of companies saying they will work to oppose this. not clear what they can do, but we've seen in the first week of the trump white house quite a bit of ceo level activity here. a lot of business executives coming and going from this white house. they clearly have the ear of this president and we know he'll be meeting with small business executives today, guys. so we'll wait and see whether business can have an influence here in pushing back on this.

the white house seems pretty confident they did the right thing for the right reasons and that the protesters are just basically political noise at this point. >> eamon, real quick, i mean, there is some question as to whether this next executive order will involve h1b visas, which is something else the high-tech community i guess would very much opposed to. for people unaware these are the visas u.s. companies employ for graduate level workers, people who are filling jobs unfortunately that perhaps can't be filled by domestic workforce always. talking about highly technical expertise. is that your understanding that's a possibility? >> that's certainly a possibility. there's just an enormous range of possibilities of what the president might sign today in terms of this executive order. that's why we're awaiting this briefing to get some clarity. one thing they talked about last week was the question of voter fraud. they suggested he would sign an executive order on that. that's on the table as well. there's just a whole range of things that the president could

do here. but you saw them clarifying last night on this green card issue new secretary of homeland security putting out a statement saying the green card holders would be considered for admission because there was just real lack of clarity over the weekend about what exactly this executive order did. and part of that is because they did not go through the typical interagency process to let everybody know and weigh in. they also didn't brief the press in advance which is something the white house has traditionally done sort of gone through the details of what's in an executive order in advance so that the press can explain to viewers and readers around the country and world exact lly whas in it and what's not in it. that's why you saw people struggling saturday to figure out what the administration was doing exactly here. >> we're getting word from the president that the scotus nomination comes tomorrow night at 8:00 p.m. we'll be talking about that through the course of today and tomorrow. thanks for your time. we'll talk to you later on. to eamon's point and mark

cuban's point a few moments ago, everyo even if you agree with the policy, jim, there's a sense -- cuban said it seemed rush. everything seems rushed. today the journal op-ed says governing is more complicated than campaign rally. is that fair? >> we don't have an attorney general. we don't have a department of justice yet. who's going to argue in favor? where was our principal leader in the country when it comes to interpreting the constitution for the executive branch? well, where's the confirmation? i think there are some things that if you don't call them rushed, you really just have no sense of the timeline. it's not like this administration has gotten all its people in and has the right spokespeople. you go on twitter -- these are -- i think a lot of people are also saying, wait a second, i know that twitter is a very interesting new medium. these are founding father principles, these are principles that have been with us forever. and it's just hard to try to equate the few number of characters to the gravity of the

issue. and to try to understand. you know, you've got federal judges that are trying to make sense of it too. to say that it's -- it's not only rushed but it's not wartime. it's not wartime. but perhaps it is wartime in the president's view. but i say wartime meaning there are decisions made so quickly that you have to say maybe there's something going on and maybe we have to just accept on faith. >> conway did make the point he knows things the rest of us do not know. >> okay, maybe he does know things. but the breathtaking nature is not -- it seemed headlong. but it just seemed way too headlong. even if you believed in it. >> trump did mention in his tweet this morning, but delta flights are departing again. ground stop has been lifted after that system outage last night led to delays and the cancellation of about 150 flights. thousands of travelers were left in limbo across the country because of that outage and the carrier says it expects more cancellations to come around midnight ed bastian, the ceo

issued a note to customers for the situation, no word delta will be named specifically by the president. >> no, transports have been the bellwether this whole rally. but american was talking about how the ultralow cost carriers and great price cutting over international -- the overseas flights. delta does this. this was a group that had been a leadership group. it's funny to talk about -- to talk about stocks in light of what's happening seems -- but on espn with the federer, don't bother med with federer thing, we're stuck with the four walls -- i'm not going to be defensive about talking about what i do for a living. >> as i understand you should not be. >> viewers say get back to business. >> delta, look, you don't sell delta on the base of that but american did not have as good a quarter as southwest. southwest is mostly domestic.

i don't intend to stop talking about the things i've talked about for the last 37 years. i'm not going to do a show for the statue of liberty. i love the statue of liberty. not going to do the show for her. >> it's cold out now, but maybe in the spring. >> there are things happening that have to do with stocks and people's money. i think you have to try to separate them out. >> we're going to get to them. >> if there's a court order in brooklyn for or against, there are people on twitter say it's going to crash because of this. i'm like thinking, okay, i'm reading through the honeywell quarter and if it crashes, you should go buy honeywell. i got to do what i do. >> yes, you do. as we all do. which is why we're going to talk about that rite aid deal getting recut with walgreens. >> with the context of what? >> with the context it's a business story and it will be a relief to get back to business. >> yeah. speaking of which a lot to get to including latest on snapchat's planned ipo. take another look at the premarket. 109 -- 103 s&p companies will report this week. we've got personal income and

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down despite other metrics, jim, shows it continues to be one of the most downloaded apps. can you make sense of this one? >> i think it's not a great category. it's a commodity -- they dominate a commodity category. seems once you have one, you don't necessarily have to buy another. it was something that took the world by storm, but like many commodity companies you can't make a lot of money once everybody has one. and what i think that james park has put out the best of these but it's not like somebody the fda has to have, it's not something your company says you have to wear. it has very slim profit margins and a lot of companies are in it. so it just turned out to be -- i've had park on repeatedly on "mad money" and each time i've expressed when are you going to get numbers right, projections right? well, they've been rolling over and over again about the projections. >> yes, they have. the stock has done nothing but go down now for quite some time. >> yeah. >> after its initial big run up back in, what, '15 i guess?

>> it made sense initially because they took the world by storm. >> they did. >> but there were men companies doing that. >> it was before the apple watch really as well. >> right. >> kind of reminiscent of gopro too. >> i don't think that's wrong. gopro took the world by storm and suddenly there were too many. the new fitbit iterations didn't do what people were hoping. i have an apple watch that does everything i need from fitbit and fitbit would say it doesn't. i'm not in the nfl. i don't need to know whether this is going to get me to be able to stop adleman. i don't have that feature. >> he's faster. >> he is. how about hogan? i don't think hogan is. >> hogan, chung, amendola. >> he played horribly for the eagles. but all i can tell you is this watch does fine. and unless belichick says i got to wear another kind, it's good enough. >> all right. we'll get cramer's mad dash,

count down to the opening bell in a few moments. one more look at the premarket as we kick off a busy full week. more "squawk on the street" from the nyse straight ahead. i'm vern, the orange money retirement rabbit, from voya. i'm the money you save for retirement. who's he? he's green money, for spending today. makes it easy to tell you apart. that, and i am better looking. i heard that. when it's time to get organized for retirement, it's time to get voya. why pause a spontaneous moment? cialis for daily use treats ed and the urinary symptoms of bph. tell your doctor about your medicines, and ask if your heart is healthy enough for sex.

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we're about seven and a half minutes from getting the week of trading started here at the new york stock exchange. interesting week shaping up already. csx is a name we touched on last week. >> right. >> things seem to be moving very quickly in terms of this activist and what they want to see happen. >> david, the press reports this weekend hunter harris, he's 72 years old, resigned from

canadian pacific, left a substantial pile of money there, teamed up with an activist to perhaps take on csx. what i'm surprised here is that talks all seem to indicate that michael would be out, the ceo since 2003 who are until this happened many people thought was doing a good job. and it's almost as if people have been buying this stock here betting that a new ceo could really turn on the jets at csx. david, i don't know about that. i think in the end it's a railroad. >> yeah. >> i think that if people feel a new ceo's going to come in, maybe they feel first thing they're going to do is sell it to another railroad. >> well, listen, you still have the service transportation board and seemed to be onerous restrictions on the possibility of these major rails get together, that was certainly the case when harrison was at canadian pacific and they were trying to buy norfolk southern. that was really not going anywhere given what the stb has said in the past. they're willing to do things to protect investors while the regulatory review went on, jim, but here it's just harrison

coming in and people saying, well, his ability to run a rail is better than anybody else's. >> look, word's fine. he's a good operator. >> been doing it for a long time. osc osc oscar munoz was right there. >> i would say be careful owners of csx because in the end union pacific did well, norfolk southern did well, these guys did well. but it's not like he can leave, new guy come in and change the operating ratios. he's not going to suddenly be able to reinvent this railroad. it's a function of cargoes, coals come down, ag's doing better, chemical okay, but there's no mir kal acle to runn railroad. you can't turn it into a social media/railroad company. >> no. >> data center railroad company. >> says something for septuagenarians. >> if he could sell it, i think you correctly said don't bank on

a sell. >> and they're not. all right. we have a lot of other stocks to watch and rite aid deal getting recut with walgreens. opening bell just a few minutes away.

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you're watching cnbc live from post nine. getting ready for the opening bell. worldwide protests were the story over the weekend, right now getting some headlines on the president who we hope to see in a few moments, making a few comments. one comment said white house had a good day on homeland security on sunday. said the supreme court pick to be announced tomorrow night is highly respected. jim, says they cut 600 million off the cost of the f-35 and that lockheed is doing a great job on the program. >> look, $600 million is better than nothing. these are very, very expensive long term defense oriented project that is not in the context not as much as you would want to see but certainly more than when he started. i think you'll see lockheed martin stock go up because that's not as big a hit to earnings if you want to try to

assess what could have happened. lockheed martin's quarter was not good because of sokorski. >> couple of upgrades, axp and disney. >> axp, again, cheapest stock in the dow. last had this earnings power stock was at 90. that's what the note recognizes. disney, again, i just continue to say that disney got hit by what i thought was irrational fears about espn and the trendline that just said espn was just going to keep going down. that's now been built in. a lot of people are standing behind disney but should have at 93, 95. >> morgan stanley's argument is cost management is a little more disciplined. other upgrades say film slate maybe one of the best ever in the year to come. >> they've eliminated the ep sodic nature of film. amazing thing. >> by the way, s&p coming off its first back-to-back losses of

the year. and for january the smallest move in a january since '07. the ten-year average is a 4% move so far of course for the month. only about half that. [ bell ringing ] >> there's the opening bell. at the big board today it's the world gold council. at the nasdaq, children's health fund, a nonprofit committed to ensures health care to america's most disadvantaged children. >> remember apple reports this week and we have lots of commentary about how apple's not going to guide well. we've got a lot of companies that are in social media that are kind of trading off. i think the snap is very important because we'll have a new golden child into the group.

but there's -- earnings so far i have felt were pretty good. i want to make that point because when we lose sight of everything and we're dealing with like the repettivety of washington -- >> american and united the worst performers just because of no clarity on the disruption of the business, right? >> no. and i think that plus we recognize, geez, are they still having computer problems? i think that had been a leadership group. the group got ahead of itself. these declines are pretty stunning. the group really had a major move. >> they did. let's take a look at rite aid because this morning the stock is down dramatically after what was also a dramatic cut in the price that walgreens is going to be paying for the drugstore operator. you can see walgreens shares down almost 17%. this had been a $9 a share deal. you may recall that jim and i

have talked about it a number of times in terms of how many stores would rite aid be forced to divest in order for the government to allow walgreens to purchase it. they've been talking somewhere in the neighborhood of 600, 650. suddenly this morning because the deal actually needed to be extended, they needed to extend the end date under the previously announced agreement from what had been the 27th of january to now the 31st of july. but in order to get that they came way down in price? $7 a share if the number of stores could be divested, jim, is below 1,000, if it is above 1,000 but below 1,200, you get 650 -- excuse me, you get 650 a share. >> right. >> no word on if it's above 1,200 stores. but that's almost a doubling of what they expected. again, this has now been extended until july. the expectation is that under an ftc trump administration they're

going to figure this out, but a dramatic price cut. >> right. this is amazing. call and only get $9, a lot of people just stuck around. said, hey, this gap will close. and this is a lesson to people who are not arbitragers, sometimes a gap stays a gap. >> there's a reason for it. people talking about the ability to get in around 600, 650, somewhere in that neighborhood. and clearly they were not correct in that. >> this is a huge win for my travel trust owns walgreens. i think it's a huge win for walgreens. but at the same time the fact is it's extended again. this thing is just never dies. you think a new ftc might actually walk it back a little? >> you know, i don't think any of us know really what to expect except that there might be a less stringent approach from a trump-led ftc. but divestitures are di

divestitures and couldn't get it done with the package they had, i guess, otherwise this would have been done. >> there's so many bogus -- fake news. so many fake news reports that stores were ready and big enough to pass muster. this is where i appreciate you as my partner because not once did you blast any of these stories that were totally wrong that kept people in rite aid forever. just really hurt people. >> yeah, now we'll be figuring out how many stores will be divested as this thing is extended until july, so they've got a long time. >> as you're talking, guys, dow just slightly back to 20k on the nose down 92 points. made a drop today of 76 points or so is the worst of the year and decline isn't the s&p would be the first three-day lost since the end of last year, jim. >> you have to think every time oil goes down we tend to go

down, that linkage is back. i think we fear this is a week of earnings where i think there are a lot of companies that i would describe as being high multiple that people are counting on. here i'm thinking about facebook reports this week. >> yes. >> that's going to be a very, very important call. apple has moved up a great deal. there are a lot of chatter that apple will not do a number that's good. a lot of chatter say apple will say -- give negative guidance. and remember the airlines have been a big leadership group. just seems like we're reverting to as if nothing happened last week. there were a lot of positives except for retailers. retailers just being horrendous. >> they were. >> border tax. >> broadly speaking do you believe there is also a response to let's call it the move against globalization that we've seen over the last week from the trump administration, whether it be the border wall and dispute with mexico and cancellation with the meeting with the mexican president and then the

90-day ban on immigration. >> i just think -- >> from seven countries. >> i think it depends on whether schumer, who is obviously very upset about the ban, if he's able to cajole republican senators to switch sides and start rethinking their allegiance. >> right. but i mean, we've also had a number of other leaders of other countries come out and say -- >> oh, yeah. >> -- their views. share their views, which are different. they're not in favor. >> i think america is an island. you want to make that america first island. and what that would mean, i think it would hurt a lot of companies that do exports. but that's what i think is the readthrough that people are doing. >> when you see a ceo speak out like some did at nike or apple or anywhere else over the weekend, you see it as impactful on the stock? negative on the stock? i'm noticing nike is down. obviously a lot is down today. >> i thought a lot about that because howard schultz was so outspoken and i was thinking if

howard schultz -- if starbucks had this amazing quarter that had lifted the stock, i would expect it to be down today. instead he had a quarter that was viewed as okay, stock got hit. and i think people just, oh, we'll sell that stock anyway. wasn't that good anyway. but i would think people speaking out -- no, i don't think it should impact the stock. >> right. >> that a ceo spoke out. i think there's a lot of ceos who have workers and they have to speak out because their workforce is concerned. >> right. >> and i think their job is to make it so their workforce doesn't feel like they're about to be rounded up. >> starbucks of course in schultz's case going a step further. >> hiring. >> saying they will hire 10,000 refugees essentially over the next several years in countries where they are able to do so. >> well, look, i think the pre -- look, i think that's -- it's not clear to me whether that has anything to do with the stock. i don't think people go to starbucks because of of it. i don't think people stay away from starbucks. i think that's a decision howard schultz made that he thinks is right for the company and right

for larger issues within the company. i think if you sell the stock off that, it's kind of not very thoughtful. >> as a ceo you have different constituencies, you have your customers, employees and shareholders. and they're not always uniform in their desires. >> right. >> employees of starbucks may embrace that. may make them feel better about working there, for example. >> i think that there are companies -- look, this is uncharted waters. we have not really had to think about allegiances and what a ceo might think about the president in terms of just hurting their own ethos and culture. some are ideas based on inclusive of which howard schultz is probably one, he has to speak out. it would be odd if howard schultz said nothing. wouldn't it be odd? >> yes. been willing to speak out on broader issues time and time again. >> right. nike, i don't know, some of

these mark parker, not necessarily. >> no. and nike of course has something else at stake in washington, which is going to be the border tax adjustment that could be hard for it to handle. >> i think there's probably a lot of places, a lot of companies were in disarray today. i mean, lloyd blankfein did issue a statement. i think lloyd blankfein is saying, listen, we're okay. we're okay. now, no ceo can protect anyone from anything if you're a wrongdoer. >> well, especially in tech where an indian immigrant at apple, the point made over and over again over the weekend was a son of an immigrant, right? a lot of that's baked into the culture. >> right. i think that's more than you would get at a typical company, a midwest company that does metal bending. it's not really based on that, but i think a lot of ceos are trying to calm their workforce down saying don't worry, you're going to be fine. i think it's pretty jarring. >> we are expecting some video

from the white house of the pool spray we mentioned a moment ago. headline out of reuters, jim, as executive orders will be taken today to begin reducing regulations, right? little more market friendly. >> yeah, i'm certainly more comfortable opining on those because what matters is earnings per share because earnings per share drives stock prices. when you see deregulation, you could immediately be additive to the stocks that did really incredibly well last week, a lot of these were pipeline companies and pipeline companies really benefit from any deregulation. like to see we're at the new regulations that might be changed. >> right. >> but do you think, as i do -- >> yes, sir. >> -- that in general there is a worry among ceos about their workforce being -- fear. and fear meaning that perhaps someone as ceo needs to stand up and say you don't need to be fearful. i have your back, is that what's going on?

>> don't you think, guys, if you're running a global company and you're relying on not just people here in the states to consume whatever product it is you're creating, but all over the world that it is potentially a danger to have this increase, if you will, in divisiveness. i think that can't help business. >> but when we asked howard schultz about being a company still based in america does it hurt sales he unequivocally said no. i know. >> the president does have a small business -- let's get to this meeting. >> -- deliberately slow. they're not behaving well at all. that's why over the last many years nothing got done in this country. but we're moving things along and we're moving them along fast. we actually had a very good day yesterday in terms of homeland security. some day we had to make the move and we decided to make the move it would be nice again if we could have our cabinet because

our cabinet, which is outstanding, is going through a lot in terms of what they're being put through. senator jeff sessions they're making him wait an extra week and did that only for political reasons. they just made him wait. i said why did they do that? just politics. i noticed chuck schumer yesterday with fake tears. i'm going to ask him who was his acting coach. because i know him very well. i don't see him as a crier. if he is, he's a different man. there's about a 5% chance it was real, but i think they were fake tears. we have a big decision that i've made, a very big decision on the united states supreme court that is going to be announced tomorrow night from the white house at 8:00. a person who is unbelievably highly respected, and i think

you will be very impressed with this person so that will be 8:00 tomorrow night at the white house. and today we have with us people who are very successful in the world of small business. and i love small business. i started as a small business. my businesses got big. and i dealt with the small businesses and the big businesses and i love you all the same. the big business folks have been fantastic. they're bringing jobs back. i say where was the outrage of the democrats when all of our companies were fleeing to mexico and to other places far away and leaving jobs behind? now they're all coming back. they're coming back by big numbers, bigger numbers than people had seen. you saw ford is announcing and has announced big plans coming back into michigan and ohio and different places. general motors has made big

announcement. fiat chrysler, the head flew all the way from italy just to make our meeting last week. you look at what's happening with lockheed, number one we're cutting the price of their planes by a lot, but they're also expanding and that's going to be a good thing. ultimately they're going to be better. boeing is also very much involved in new hirings and also coming in with good pricing. so we're cutting prices, we all know about that. the people at this table know about that. you could have done that. but we cut approximately $600 million off the f-35 fighter. and that only amounts to 90 planes out of close to 3,000 planes. and when you think about $600 million that was announced by marillyn, the head of lockheed martin, i got involved with that about a month ago. a lot was put out, and when say a lot, a lot meant about 90

planes. they were having a lot of difficulty. there was no movement. and i was able to get $600 million approximately off those planes. so i think that was a great achievement, but that really means much more than that if you think about the fact that that's 90 planes out of close to 3,000 planes. i appreciate lockheed martin for being so responsive. and that will be appreciated very much. i appreciate boeing for coming in and competing. and now they'll be competing during the process -- we have a lot of planes coming. these are contracts that everybody knows about. the f-35 fighter jet. a great plane, by the way. i have to tell you. and lockheed is doing a very good job as of now there were great delays about seven years of delays, tremendous cost overruns. we've ended all of that. and we've got that program

really, really now in good shape. so i'm very proud of that. i actually started working on that when i was president-elect. and the reason i was working on it and you folks would understand it because we love doing that stuff, right? somebody said why don't you take a vacation before you become president, i said because i like doing this. but we're saving -- we will be saving billions and billions and billions of dollars on contracts. as you know, we approved the pipelines, but as i'm sitting here and looking at the approval i said where is this pipe made? these are massive pipes bigger than this room. and a lot of it is made in other countries, including china. i said you mean you can make pipe in china and other places far away, ship it to the united states on massive boats, put it on trucks and deliver it to the middle of the country and we can't make it cheaper?

right? what are we talking about here? these are big pipes. now, the only way i can imagine they do that is they must have to cut them. they're so big. they take up so much room. i can't imagine you put that much pipeline in ships. it's not enough, it's not long enough. so i assume they have to fabricate and cut, which hurts the pipe by the way. so i said to myself, if they're going to do the pipe in the united states using the powers of the united states including eminent domain for those who used to criticize me about, oh, eminent domain, i said did you ever ride on a highway before -- remember especially during the primaries i was criticized about the use of eminent domain. well, they need eminent domain to do pipelines. but if we're going to use powers of eminent domain into all the other powers, then i want the pipe to be manufactured with united states steel. that doesn't mean the company

united states steel, it means steel from the united states. united states steel will be absolutely a bidder. and i also want it to be fabricated in the united states. so if we're doing these massive pipelines, i want the workers in the united states to fabricate the pipe. and that sort of makes sense, don't you think, as small business owners? so we're doing a lot of things, a lot of really great things and we're very proud of it. the small business is a big part of american economic success, although lately there hasn't been too much success because we're having our products made everywhere in the world so much. but we're bringing them all back. it's coming back, it's coming back fast. you see the difference already, right? >> absolutely. >> more than 28 million small businesses in the country, 28 million small business equals fewer than 500 employees, that's what's considered a small business. anybody have over 500 employees here? if you do we'll get you the hell out of here.

56 million small business employees. think of it. 56 million. small business is really our biggest business. we employ 48% of private workforce. the private workforce big percentages employed by small business. so we read about general motors and ford and boeing and lockheed, and all of these great companies, but a big percentage of them are small business. we want to make life easier for these small business owners. that's what we're here for today. last week we had the big businesses. this week coming we have the really, really big businesses set up by steve schwartzman, big wall street person, man has done a great job, we have the greatest -- set up. that's happening really soon. but the small business we're going to simplify, reduce, eliminate regulations. we're doing that for big business too, by the way. big businesses are thrilled

what's happening. the stock market has gone up massively since the election. everyone saying, well, the market will go down, it's not going down. the smart people know me. the business people know me. they know what i'm about. so the market went massively up. when i was elected a lot of the really smart people went out and bought a lot of stock. and they've been rewarded. we want to simplify and lower taxes, unless you'd rather have high taxes, right? so small business owners can spend more time and money finding and responding to customers and expanding markets. they have more money and more opportunities to hire more employees. so essentially we're getting rid of regulation to a massive extent. could be as much as 75%. could be even slightly more than that. we're going to have great protection for the consumer. we have to. but we don't need 97 different rules to take care of one

element. their individual economic success will support american success. we want to end the unfairness between small and big business caused by regulation. regulation that's actually been horrible for big business, but it's been worse for small business. plus small business can't hire the kind of talent that the big businesses can hire, so it's really very unfair. big business so often can afford compliance with the costly regulations, but i don't want them to. i want them to build new plants and sell more cars. we're going to be doing tremendous numbers. you saw the head of general motors and ford leaving last week, they couldn't believe -- one of them said one of the greatest meetings we've ever attended. the unions were here last week representing workers, whether it's union or not. they said was the single greatest meeting they've ever had. that was a nice statement. i didn't tell them to say that, but it was a nice statement.

it's unfair to small business. small business has been treated very, very badly. as you people know better than anybody it's almost impossible now to start a small business. and it's virtually impossible to expand your existing business because of regulations. >> that's right. >> and because if the banks don't loan you money, you know, dodd/frank is a disaster. we'll be doing a big number on dodd/frank. so that's one main reason why i'm taking this action and i'll be taking an action later this morning. if you'd like you can join me at the signing to begin our effort to dramatically reduce federal regulations. and wooe'll be reducing them b g bigly, our entrepreneurial experience has been very damaged. so the american dream is back. we're going to create an environment for small business like we haven't had in many, many decades.

this isn't a knock on president obama. this is a knock on many presidents preceding me. a knock on everybody. got particularly bad in the last eight years, but it's not a knock on anybody. it's a knock on many. so i just want to thank you all for being here. and now let's talk. >> thank you, press. >> thank you. >> thank you, guys. >> that is the president meeting with small business leaders this morning companies like mexican bistro cafe, number of topics saying the scotus announcement tomorrow night 8:00 a person unbelievably respected, comments on lockheed. long discussion of made in america oil pipe and then of

course that big macro discussion about the stock market. the smart people know me, they know what i'm about. so the market went nuts. and those people who bought since the election have been rewarded. >> well, you know, lockheed martin just some of the perspective, that's a $1.5 trillion company according to cnbc.com. >> $1.5 trillion contract of 55 years. >> of 55 years. the average of the generic plant is $178 million. you say why isn't lockheed martin stock down? because they took out $600 million. >> over 90 planes, i think he said. 600 million on the next 90. figure out it's about $7 million a plane. >> right. but you know, i would say good for the country. >> yeah. >> doesn't hurt lockheed as much as people might have thought. so it's a saving. anyone saying it's not a saving is being political. but it's not such a saving it hurts lockheed. the president is absolutely right, we've been completely priced out by imports, have been for years. u.s. steel that was really the bread and butter was oil

country, when you go to the different wells i've been a lot of different places you always see mexican pipe, it's much cheaper than u.s. pipe. now, how is that? because -- or chinese pipe. and chinese pipe it's because they've been dumped. there have been a lot of investigations and i think the president is justified in saying, listen, how does it happen you can make tube and it's not used here? and the answer is, well, our tube is more expensive and why is that? because the other guys are making it more cheaply and we have a higher cost basis. but, yeah, i mean that's true. the oil country t the biggest buyer, he said i can't afford u.s. steel. i have to buy mexican steel. >> well, advisor -- >> right. he's no longer with newcorp. >> oh, sorry. >> they did not make that kind of steel, but it's true u.s. steel no one more growing the business than aubrey and he decided he can't afford

u.s. steel. >> right. in the journal about small businesses particularly ones that do a lot of importing and how they would be hurt with their tax bill rising under tax reform again at this point if it does include this border adjustment tax. i wonder whether that will come up at all. but if you're running a small business where you're importing toys, for example, or something along those lines, your tax bill is likely going to go up dramatically because you're no longer going to expense the cost of your imports. >> and matthew boss from j.p. morgan with a note about abercrombie taking numbers well below the street talking about retailers that could really be hurt. very tough environment for retailer. retail and health care it's too hard for me. >> one last thing here we're going to be doing a big number on dodd/frank. >> yeah. american dream is back. i was parsing everything he said because everything he said is directly impactful on earnings. big number on dodd/frank means go buy goldman sachs. it literally is. when you hear these things, it's like cutting numbers, blah blah blah, raising numbers -- if you

put a little sub text, president addresses everything that is our world. >> yes. >> everything. >> yes. >> there's no doubt about that. what's on mad tonight, jim? >> united rentals which has been a huge trump stock is on tonight. you rent equipment to be able to build trenches, pipelines, that's going to be terrific. and farook ckathwari, i'm talkig numbers cut, cut, cut regarded negative, find out what the psyche is of the consumer, but the president today is -- ten firms in terms of taking number down. buy u.s. steel on that statement, also lockheed because it's not a big hit. >> powerful calls no doubt. jim, see you tonight. when we come back a lot more on the president and the markets at this point. worst day for the dow since october 11th. s&p has a chance now down almost a full percent of breaking that streak of 74 days without a 1% decline. back in a minute. ♪

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♪ good monday morning. welcome back to "squawk on the street." i'm carl quintanilla with sara eisen, david faber at the new york stock exchange. watching the markets as the statements from the president come out a few moments ago. dow down a little more than half a percent here, back below 20k, worst day since october 11th. s&p the one to watch. we've got 74 days without a 1% decline, the question is whether that ends today. our roadmap for the hour begins with president trump defending his executive orders on immigration as protests erupt, more orders coming from the white house this morning. >> corporate america speaking out. the response from nike, starbucks, apple, uber and more. >> plus, delta delays as computer outage forces a ground stop. that being lifted this morning. we've got the latest for you on that one. but first, the world reacts to president trump's executive order barring refugees from entering the united states and restricting travel by people from seven muslim majority countries.

the white house also busy this morning with some new announcements and meetings with small business leaders. our own eamon javers is outside the white house and he joins us with the latest on all of it. good morning, eamon. >> good morning, sara. i just came out of a briefing here with senior administration officials at the white house about the executive order president trump will sign at 10:30 this morning. this is going to put the regulatory framework around donald trump's promise out on the campaign trail to eliminate two regulations for every new regulation that's imposed. what they explained to us that there is a regulatory freeze in place right now. they wanted to stop any obama era regulations from working their way through the process. after that though they're actually going to score the cost in dollar terms to the private sector of each new regulation that is imposed. and they're going to mandate each agency head that is proposing a new regulation come up with two regulations that total up the same cost on the economy as the one that they're proposing for elimination. that's all going to be coordinated out of the white house and office of management

and budget. so this is a new way of approaching this creating sort of a budget for regulations. they say the budget will be zero dollars for new regulatory cost on the economy in fy-2017 which is fiscal year we're already in the process of right now. for 2018 and going forward that's not been set yet. we'll see the details of this new executive order at 10:30. and the text of it. but among the things they're telling us it's still to be worked out whether the new regulation can go into place before the two regulations that are being repealed have officially been pulled off the books. you know, that regulatory process can take quite some time. they might want to allow the new regulations to go in even before those old two regulations have been formally pulled off the books. this would at least require those agency heads to identify two regulations that total up the same dollar impact on the economy, the private sector companies' employers as the one that's being proposed, guys. so a new framework here on regulations from the white house. >> although that two gone for

every new one is almost word for word out of his first 100 day campaign platform, eamon, we should take note of that. >> exactly right. thanks. >> meantime ceos speaking out against trump immigration order over the weekend, tech in particular at the center of the debate. our josh lipton joins us this morning with the latest from san francisco. good morning, josh. >> well, carl, so much for that truce between tech and trump. tech ceos have now come out sharply opposed to trump's executive order. for some like microsoft's satya nadella extremely personal, as an immigrant and ceo i've both experienced and seen the positive impact that immigration has on our company, for the country and for the world. we will continue to advocate on this important topic. apple's ceo tim cook also responding telling his employees, i share your concerns, it is not a policy we support. other tech execs were even actively involved in the

protests. for example, google co-founder who emigrated to the u.s. from the soviet union took part in protest at san francisco international airport. now, tech execs are working with trump, so it's possible they could have an impact on his thinking regarding this action. elon musk, rometty and kalanick all serve on the president's forum. kalanick will set up a fund, and for charging could have at airport while taxi drivers there sus penpended service, some cri charge uber trying to profit from that process, uber saying it had not intended breaking the strike. back to you. >> josh lipton, thank you. other ceos outside of tech are responding to the president's executive orders on immigration. nike ceo for instance mark parker sent out a letter yesterday to employees saying,

quote, nike believes in a world where everyone celebrates the power of diversity regardless of whether or how you worship, where you come from, who you love, everyone's individual experience is what makes us stronger as a whole. this is a policy we don't support. starbucks ceo howard schultz taking a step further also writing to employees saying the company will do everything possible to support affected workers. schultz saying starbucks plans to hire 10,000 refugees over the next five years in 75 countries. and goldman sachs ceo lloyd blankfein left a voicemail for employees saying, quote, this is not a policy we support. i want to assure all of you that we will work to minimize such disruption to the extent we can within the law and are focused on supporting our colleagues and their families who may be affected. guys, clearly ceos are having to find their voice in an administration where by all accounts they have more of a voice, whether they're on a manufacturing council or meeting with president trump.

this is the first real rift after a lot of especially those out of silicon valley were quieted by the election and the win of donald trump after they largely campaigned against him. >> right. and we've seen a lot of the photo ops that have included some of the major leaders in technology being in the room with the president. but in this case many are departing from supporting this current plan. >> with various strategies. elon musk, for instance, seems to suggest that you go back, you read the original executive order, come up with ideas to make it better that he might somehow curate and take back to the white house with some changes. >> yeah, kellyanne conway was asked that this morning on "squawk box." she didn't say this was permanent and weren't going to be open from any changes. we'll see if he takes advice from ceos on that front. and the question for investors, guys, the immediate business impact isn't clear, but obviously this does impact

company employees and even if people with green cards are allowed back in the country, you know, they have family members. and of course there are customers in these markets. so for a multinational company this is an issue. >> yep. not to mention if you're exacerbating tensions more broadly with other countries. now in this case the seven countries we're talking about it's not as though we do an enormous amount of trade with them already. certainly we do very little with the likes of iran, but there are plenty of other countries that we do do a lot with who are also not supportive of all of this ban. >> let's talk about the economic impact, bring back chief global political analyst at citi, jared, welcome back guys, it's good to talk to you. tina, over the weekend it was immigration, today it's deregulation. t the border wall and tpp feels like it was months ago. what's important now?

>> what's important right now? well, i think what's important is for investors who thought they should take trump seriously but not literally, it's now time to take trump seriously and literally. and also to note that in this flurry of executive orders in the last week, one more than actually president obama put out in his first week, none of them had anything to do with the agenda that financial markets were looking for. >> what do you think is the appropriate response, jared, from corporate america right now? >> i think it's to be very strong and very clear about the fact that none of what we're hearing is either consistent with american values, american law or frankly good economics. i understand trump's anti-globalization, his ins l r

anti-globalization, his insul insularity, but with an economy like ours increasingly integrated with the rest of the world, i don't think it makes any sense for people who listen to this voice and this financial market station to be anything but extremely firm in rejecting this kind of really anti-american, anti-global stance. >> jared, to reject it is to reject exactly what he ran on. some of these are copied and pasted from the campaign platform. >> no question about that. but first of all, trump ran on a lot of stuff and i don't believe everything he says. second of all, he also ran on a strong economy. he actually talked and i think it was nonsense about doubling gdp growth. that's not going to happen. but the things he's doing now i think are incredibly inconsistent with his argument that he's going to be good for markets, good for the economy, good for growth, good for jobs. >> tina, you mentioned and noted that the executive orders we've gotten have not really been focused on economics. to the extent that the market has rallied on the prospect of tax reform and deregulation and perhaps even infrastructure spending, is it your sense that

those topics take a backseat now? >> well, it would appear that they're not the administration's priority. we haven't changed our view that any of those policies are likely, but to some extent the market may have rallied too soon and got ahead of the politics, right? because we've said pretty consistently that we do expect fiscal expansion and, you know, probably the best chance on tax reform than we've had for some time. but those are all things that are going to take longer and require congress, right? that means they probably go into the second half of the year. but we saw on monday morning although it's impossible to establish a correlation the s&p traded lower, and i think this focus on security and social issues may start to give investors pause for thought. >> where are you on that, jared? do you really think that this decreases, diminishes the odds of tax reform?

i think that's what potentially the biggest stimulus here for the markets, lower corporate taxes, from happening sooner than later? >> it's going to happen later. it was never going to happen sooner. but i firmly believe that there will be some kind of a big tax cut. whether you want to call it tax reform, that's what we're arguing about now specifically what the details would look like, but i would be amazed if some time later in 2017 congress doesn't pass a very significant tax cut both on high end incomes and corporate america. infrastructure by the way and i think markets have gotten very much ahead at this point, infrastructure is very uncertain. house republicans who hold the pursestrings are not excited about an infrastructure program. frankly, i think they should be, but they're not. >> well, i think -- >> one last thing, tina -- >> i think it's a good point to pick up on on what house republicans are pushing back on the president. and i think we may see more of this 12 republican senators coming out against the infrastructure bill. and i think there's a real potential when we think about u.s. political -- for more

constituencies to come together around some of these issues. we've seen protests around the country. do we start to see popular risk in america in a way we haven't seen before. >> really, that was not demonstrated this weekend by large number of republicans beyond your grahams and mccains and flakes. >> that's true. >> not yet. >> that's true. but the fact is that we are having a really encompassing discussion right now about an immigrant ban that's almost certainly illegal and completely inconsistent with both our values and global economics. i don't think there's much healthy -- you can maybe look at this from different angles but i don't think there's much healthy about it frankly. >> jared, tina, we're going to talk more about this in the days to come. appreciate your time on a monday. thanks very much. >> thank you. >> thank you. >> dow is down now 162. this is by far the biggest decline of the past four months or so. let's get to bob pisani on the floor. hey, bob. >> hello, carl.

good to be back. take a look at the s&p. we got down right at the open, but got worse after the president came on. looks to me like sell stops went off at some point. we lost about five points about 9:45 as the president started coming in. we're seeing lows of the day. sectors banks have been weak but they were weak in europe as well. transports have been weak. delta's computer problems are not helping at all. the russell 2000 is notable standout here in terms of major sectors, but energy and tech also on the weak side. high beta stuff, sort of a risk off day. if you look at stuff that moves more in the market like some oil and gas companies, cabot and murphy, regions, techs like nvidia and home builders generally most of them are still high beta movers all down a lot more than the overall markets here. not a lot of earnings here, but we're in the heart of the earnings season, about a third of the market has reported and numbers are pretty good overall. up about 7% for the s&p, blended numbers. revenue's up about 4% overall.

those are a lot better than we had a little while ago. so remember what was going on there, pretty good overall. a lot of discussion about what's going on with the federal reserve. remember what's happening on wednesday, the meeting is going to be occurring and they've got to come out and sound positive on the economy, avoid sending overly hawkish signals, but still they don't have as much information as they need, same stuff we have and we need on stimulus and tax cuts. i think that's going to be a big issue for markets in the next couple days here. not a lot of earnings today, but the important things we're seeing movement overall here. 6%, 7% earnings growth in the fourth quarter, revenue's up 4%. look how much this has changed in the last few quarters. a year ago in the first quarter we were down 5% on earnings growth overall. then it was down 2%. the third quarter went positive. fourth quarter earnings almost 7%. here's the problem, the entire rest of the year we're expecting double digit increases in earnings in the first quarter, second and third and fourth quarter. that's why people are a little concerned about whether you can actually deliver on what the

market is expecting right now. finally, you mentioned the snap ipo may be filed publicly later this week, but we had some notable successes last week. we had three big ipos raised almost $1.5 billion. last year in january we had zero, zero operating companies went public a year ago. already way ahead of the game here. this tuesday night we're going to have a fairly big company coming out $1.5 billion company. and that's invitation homes. take a look here, this is blackstone's home rental reits. that own a portfolio of single family homes in the united states. look at the math here 77 million shares $18 to $21. that's a $1.5 billion ipo pricing tuesday night for wednesday on top of what's going on. snap, i just talked to some of the nyse people here. the calendar is filling up rather rapidly. finally, finally we're seeing some action in the ipo market. carl, back to you. >> i'll take it, bob. that will be a big bellwether for sure. economic data out moments ago. let's get to diana olick with

some housing sales numbers. diana. >> well, sara, pending home sales rebounded up 1.6% for december for the month pretty much along with expectations, barely eked out a gain year over year up 0.3%. but the market is really divided both geographically and on price. homes priced above $250,000 were up 10% year over year in december, but those priced between $100,000 and $150,000 just up barely 2% and those priced below $100,000 down 11% year over year. you can see where the market is looking to where the homes are listed. there are a lot more listings of more expensive homes than there are of the entry level homes. geographically sales fell in the northeast and the midwest and rose in the south and the west. the west up 5%. remember, this is a measure of signed contracts in december. that's people out shopping for homes in december right after mortgage rates jumped pretty dramatically after the presidential election. we saw sales of newly built

homes fall in december due to those higher mortgage rates because new homes have a pretty high price premium compared to existing. back to you guys. >> diana, thank you. when we come back, we'll speak with the former u.s. trade representative under president obama and deputy national security advisor michael froman. his take on president trump's latest actions and how the roadmap for his agenda has changed. and taking a look at stocks at this hour, the dow's down about 161 points, worst day for the dow, s&p and nasdaq of the year. nasdaq down 1.3%. amazon, facebook, alphabet, apple, microsoft all the biggest. much more on the markets when "squawk on the street" comes right back. what's critical thinking like?

a basketball costs $14. what's team spirit worth? (cheers) what's it worth to talk to your mom? what's the value of a walk in the woods? the value of capital is to create, not just wealth, but things that matter. morgan stanley

the trump administration's executive actions on trade and immigration receiving widespread pushback. and joining us for more, the former u.s. trade representative under president barack obama as well as the former deputy national security advisor for economic affairs michael froman. good morning. good to see you. >> good to be here. >> so you stepped out of the administration, what, ten days ago? what's it been like for you to

watch the last ten days unfold, specifically in your area of immigration and trade orders under the trump administration? >> well, i think on the trade side we've seen some unfortunate developments. pulling out of an agreement that would have eliminated 18,000 taxes on american exports and inflicting -- a self-inflicted wound in terms of leadership and credibility across the asia pacific. we're now in a spat with mexico that hopefully we'll get worked out and i'm hopeful the new administration will begin to think through not just the announcement value of various initiatives but what the secondary and thirs yar could have implications for the u.s. economy and position in the world. >> we want to talk to you about trade, michael, but the topic at the forefront this morning is of course that immigration order. you were on the national security council. do you think this order undermines our national and international security, economic

or otherwise? >> well, look, i'm no expert on immigration or counterterrorism, but those experts that are out there made it pretty clear that they see this as a self-inflicted wound by republicans and democrats out there criticizing the administration for this. look, it's very personal for everybody. my father was a refugee from nazi germany, i'm the son of an immigrant. all of us have stories about us personally, our family, our friends and neighbors, our co-workers. this contrarian to american values, bad economics as some of your commentators have noted and very much hurts our credibility and leadership in the world. and that's a very important asset to harvest and maintain. the leadership and credibility in the world with other countries and other leaders and people around the world we need other countries' cooperation -- >> sorry to interrupt you. here is the president. >> this will be the largest ever cut by far in terms of

regulation. these folks are small business owners. and they're great people. they've been representative of the community, the small business community. if you have a regulation you want, number one -- but if we do, the only way you have a chance is we have to knock out two regulations for every new regulation. so there's a new regulation, they have to knock out two, but it goes far beyond that. we're cutting regulations massively for small business. and for large business, but they're different. but for small business. and that's what this is about today. and this will be the biggest our country has ever seen. there will be regulation, there will be controls but it will be a normalized control where you can open your business and expand your business very easily. and that's what our country has been all about.

should i sign it? >> absolutely. >> sign it. >> that's a big one. do you have anything to say for the press, anybody? would anybody like to say anything from the press? anybody? >> just thank you for doing this because small business has just been buried in a tidal wave of red tape. to break that will really change the world for us. thank you. >> absolutely. [ applause ] >> that is the president flanked by small business owners announcing some of these executive orders that center around regulation, as he said, for every new federal regulation t two must be revoked. they're going to score these on a budget and look at the costs down the road for the current fiscal year of course that budget will be set at zero, guys.

it does illustrate the degree to which this is applauded certainly by his supporters but arguably up until now by the market at large. one reason things like this -- one reason the market had elevated since election day. >> yeah, not being applauded exactly right now. dow's down 161, worst day. we got a full percent move lower for the s&p as you just mentioned. michael froman is with us, former u.s. trade representative under president obama. michael, on this sort of business friendly agenda, ceos this morning are trying to figure out how business friendly the trump administration is going to be whether it's immigration and trade or rolling back regulations and talking about lower taxes. what would you say to them? >> well, look, certainly when it comes to promoting american business and the workers who are employed by those companies, opening markets abroad is absolutely critical. we know 95% of the world's consumers are outside the u.s., 80% of the purchasing power. and that's why it's so important that we be proactive and have leadership when it comes to

opening markets. i think the actions that the administration has taken so far in pulling out of trade agreements are disstretressing that perspective. but taking actions including what we did through trade agreements to eliminate barriers for small businesses to make it easier for them to navigate regulations in other countries, that's a key part of the obama administration's agenda that i hope the new administration will continue. >> well, you heard that one small business owner, they've been in a tida tidal wave of re tape. i want to ask about any potential retaliatory moves, you've been in the room and negotiated with these other countries, what speaking of china and rhetoric gets worse or mexico talking up this 20% border tax, what will these countries be doing to american firms in response? and who do you think is most exposed? >> look, i think when we start talking about raising barriers

to imports from other countries, you run three risks, retaliation, imitation and taxation. the first is if we were going to engage in illegal action of raising tariffs on another country, it's going to open the door to them retaliating against our exports. whether it's mexico, china or others. secondly, if we do something that's clearly in violation of our obligations, then we're giving license to every other country to do the same. as i said most of the world's consumers are outside the united states. we need access to those other markets to support jobs here at home. so if they retaliate against us, we're hurt. and then finally, when we raise tariffs, it's a tax. it's a tax on the people in our country who are least able to afford it. low income americans spend a higher proportion of their income on tradeable goods, clothing, footwear, food. if you raise tariffs, which is a tax on imports, you are imposing a tax on the people in our society least able to afford it, people just scraping to get by as president trump talked about during the campaign. from that perspective it seems

counterproductive. >> why don't you think the markets reacted? you've been warning about this. economists are warning about it. people on cnbc all the time warning about how a trade war doesn't help anyone, hurts global economic growth. the market's been amazingly resilient running up to 20,000 last week in the face of all this. >> i've learned a long time ago not to try and predict or understand exactly what drives the markets. i think you have to look over the long run what will be the position of the united states in the global economy, will we have the access to other markets around the world, will we have cooperation of other countries when it comes time to do things together that we need them to cooperate on. and i think over time that's going to have an impact on our economy as well. >> michael froman, please come back. we're going to talk a lot of trade, i have a feeling. michael froman, former u.s. trade representative under president obama. >> thank you. >> for more on those executive orders just signed by the president, our eamon javers is with us once again from outside the white house. good morning once again, eamon. >> yeah, good morning, carl.

you saw the business talking about small business and flanked by small business leaders but this is a measure that will be welcomed by many in big business and industry as well. a lot of those executives and ceos have complained for years about regulatory impact. what we're told by administration officials about how this will work is that each agency head will be responsible as they propose every new regulation for identifying two regulations to cut in order to impose any single new regulation. they're also going to score these and create a new budgetary system for analyzing the overall cost to the economy for each of these regulations. and they want the cost of the two regulations eliminated to equal the cost of the new regulation that is being imposed. they say the cost overall for fy '17, the fiscal year we are in right now will be zero. and they'll estimate what it will be in the future on a going forward basis. but they also say that the regulatory freeze that they have in place now from obama era regulations will gradually thaw, in their words, and the agencies

will begin to issue new regulations over the course of the trump administration. those will be approved by the agency heads in the white house. but this will give tremendous authority here to the office of management and budget and to the white house in terms of eliminating a thicket of regulations. each agency head ultimately will be responsible for spotlighting those. and there's some question about timing. it's not clear exactly how this is going to work. they say they might have to allow some of those new regulations to be put in place even before the old ones are removed. they might just have to identify them for remove. that's all being worked out. still some moving pieces here, carl, as well. >> all eyes on mick mumulvaney sure. let's get to sue herera for a news update. >> hi, carl. thank you so much. good morning everyone. here's your cnbc news update this hour. canadian prime minister justin trudeau calling the chuting at a canadian mosque last night an

act of terrorism. six people were killed, eight were injured during evening prayers in quebec city. two suspects have been arrested. police say they were the only two involved and they have just named them, the first person alexandra bisnet and second suspect mohamed kanir. meantime in new york, the police department there is stepping up patrols at mosques and other houses of worships in the new york city area announcing teams will be on what they call extended tour coverage. a police van parked outside the islamic cultural center in new york this morning. toyota has relinquished the title of the world's biggest automaker to volkswagen. general motors reports its final 2016 tally next week, and if gm's numbers fall short, it would be the first time the german automaker has become number one. that comes despite its emissions cheating scandal. and ikea is recalling more than 30,000 beach chairing following reports of fingertip

amputations and other injuries, involving the folding chairs with a wood base and attached polyester fabric seat. the chairs were sold between february of 2013 and december of 2016. and that's the news update this hour. sara, carl, back downtown to you. >> all right, sue, thank you. when we come back, we'll speak with a member of trump's manufacturing jobs initiative of the aflcio. her take on the president's trade and immigration policies, what they all mean for workers next. with the dow now down about 176 points. hey nicole. hey! i just wanted to thank your support team for walking me through my first options trade. we only do it for everyone gary. well, i feel pretty smart. well, we're all about educating people on options strategies.

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country in city centers, airports reacting to the president's executive orders banning travel from seven nations. this morning here at jfk airport a different scene for you. the protests have died down and the department of homeland security also saying that all cases have now been cleared, meaning that no one is currently being detained at any of the airports across the u.s. advocacy lawyers though they're still being camped out here at terminal four here at jfk. and they are saying that those that want to get back to the u.s., that's their main concern right now, those that want to get back to the u.s. are finding it difficult. >> we're here trying to help at jfk, but we're concerned about how many people those who lived here who went home for vacation or had to take a work trip or whatever. all of a sudden are stranded outside of the country. >> now, to add to the travel woes, delta suffering another ground stop on its domestic flights on sunday evening. the second one in six months

owing to a computer glitch causing 150 flights to be canceled overnight. delta services are back to normal this morning, but president trump tweeting blaming delta's computer outage for the problems at the airports putting out that only 109 people out of 325,000 were detained and held for questioning. now, one of the main complaints behind the travel ban was really the lack of notice given to airports and to passengers. president trump addressing those concerns in yet another tweet this morning saying that if the ban were announced with a one-week notice, the bad would rush into our country during that week. and he followed that up by saying that there are a lot of bad dudes out there. back to you. >> susan li at jfk. susan, thank you for that. meantime, the president's controversial immigration ban has been met with opposition from a number of american companies and their ceos. apple's tim cook, goldman's lloyd blankfein among those speaking out fearing for the status of their immigrant employees. question is will this derail

some of the president's agenda on taxes, jobs and manufacturing? joining us this morning thea lee, aflcio deputy chief of staff recently named to the president's manufacturing initiative. good to have you with us this morning. thanks for joining us. >> thanks for having me. >> a big part of our discussion this morning was whether the events of the weekend and events like that put in jeopardy other policies the market is counting on. is that how you see it? >> well, i think it's certainly been a turbulent and chaotic weekend and i don't think it's done the new administration any favors. these are tough times and it's very confusing right now. we don't have a clear set of policies kp a clear direction forward. >> has the initiative done anything to change that as far as the meetings you've already been in? >> we haven't been in any meetings yet. the president's manufacturing jobs initiative was just announced on friday. and we haven't had any formal meetings at this time. so, you know, we'll look forward

to giving advice on behalf of american workers to the manufacturing jobs initiative. >> what are your hopes for this initiative? certainly what is going to be the afl-cio's stance? what are you going to press for? >> we're certainly going to press for not just more jobs, more manufacturing jobs but good jobs. we want to make sure that workers rights are protected, that we are protecting the labor standards, we are interested in buy american making sure that as we build up the manufacturing sector we're making sure we use our trade policies and our procurement policies in a way that are supportive of good jobs in the united states. but it's also important to us that we be an internationalist frame. that is something the afl-cio is we've add vocated for new trade policies and manufacturing policies, we believe we're part of a global economy that we have solidarity with workers all over the world and we want to make sure that the rules of the international trading system are

good for working people both here in the united states and around the world. >> thea, i hope you'll stay with us for just one moment. i want to interrupt briefly here get to bob pisani with a little breaking news on that snap ipo. bob. >> we've been talking about the fact they may file publicly this week their ipo. and we are now able to report to you that according to a single source snap ipo will be listed here at the new york stock exchange. this has been a very fought over listing, tom far li, the ceo of the new york stock exchange, for several weeks when snap announced they were going to do something was wearing the spectacles you might recall, carl, snap spectacles at a number of different events taking pictures on the floor and walking around with him. so he made no secret of his eager desire to get the listing. again, we can report according to a single source it will be listed here at the new york stock exchange. of course i have a call into tom

f farley for any more information. >> all right, bob, thank you. that would be a big win for the new york stock exchange. let's get back to our guest we have thea lee of afl-cio, part of the president's manufacturing council. based on what you've seen so far and there's been a lot of action already to digest from immigration to withdrawing from the tpp and all sorts of other measures expecting a supreme court pick tomorrow night, so far is he living up to that promise? >> well, i think there are a lot of contradictions in what we've seen so far from the trump administration, certainly we've been supportive of the end of tpp, the renegotiation of nafta although we want to see how nafta gets renegotiated because that's important as well. but we do have a lot of concerns around the cabinet nominations, certainly we've had an objection to the nominee for secretary of labor andy puzder who has not been a friend of working people has not shown he's interested in working and enforcing and

supporting strong labor protections, minimum wage, overtime regulations that are important for american workers. so we're going to keep our eye on all of that and in terms of the immigration policy we are concerned. you know, i think any immigration policy needs to be humane, rational and constitutional. it's not clear that the executive orders that we saw this week meet that standard. >> all that said though, i wonder how encouraged you are that, first, that the afl-cio has been listed as part of the initiati initiative, that trump has actually met with the president, do you think that's all for show or do you expect some of these initiatives to be presented by you and taken seriously by the would you say? >> listen, we're very happy to have a voice that we will use on behalf of american workers. we've done that with every administration, democratic and republican. and, you know, we will -- president trump and i will be advocating for american workers in the manufacturing jobs initiative and elsewhere. we'll use whatever avenues, whatever voices we have to make sure that workers' interests are

protected as we go forward. and i think because there's been a lot of internal contradictions and a lot of confusing messages and signals it will be very important that the voice of working people is heard in this white house as it has been in past white houses. >> and finally, you applauded the move to withdraw from tpp. can you just explain how putting up barriers on trade and not opening up new markets to trade actually helps american business and american workers? >> well, not doing tpp doesn't put up any barriers. in fact, we have status quo which is fairly low tariff barriers, certainly here in the united states and around the world. we already have trade agreements with half of the tpp countries. so i think it's maybe exaggerated the impact that not doing tpp will have. that was a flawed agreement. the negotiation of the tpp was in favor of corporate interests, not working people's interests. we would have liked that agreement to look very different. and we could have supported it

if it had looked different. unfortunately the tpp negotiations went in a very misguided and flawed direction. so given that we, the afl-cio, labor movement, broader coalition of progressive groups had fought very hard. and we think that tpp would not have become law no matter who was elected president. because it didn't have the support in congress. it did not have the support of the american people. and it would have been a bad agreement for working families. >> certainly showed its weakness during the campaign no matter what, you're right about that, thea. appreciate your time. thank you so much. please come back. thea lee of the afl-cio. >> thanks for having me. >> as we go to break, quick look at shares of rite aid, the company trading lower after reports they will amend their merger agreement with walgreens. meantime dow's down 186, close to session lows. don't go away.

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today at esd.ny.gov here's some good news, the outlook for overall economic growth is improving, at least

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ahhh...that's a profit. way to grow, rodney! visit quickbooks.com. welcome back. now we'll send it to rick santelli at the cme group in chicago who has "the santelli exchange," rick. >> good morning and thank you, david. welcome my first guest of the week, jim karen. jim, you've been writing about the business cycle and how it needs a jump start. the average business cycle is let's say 69 months, 58 months expanding, 11 months contracting, we're kind of past all those time markers. do we need to have a recession to jump start the business cycle, or is this going to be like that movie the day the earth stood still where we had the days of 2012, '13, '14 the economy stood still. maybe that didn't count. your thoughts. >> well, i don't think we necessarily need a recession to rejump start the business cycle. one of the things we have to

think about is the kind of growth we got since the crisis. we really got managed growth from central bank policies. we weren't really able to grow above 2% for any period of time. that's a very managed process. what i think is actually taking place right now is that we're at a point where we actually get to see the animal spirits, get to see the organic growth from something that comes more from final demand. one of the things that's been sorely lacking in gdp over the last several years is capital expenditure and business investment. if what we're seeing are policies geared towards getting business investment and capital expenditures, then i think we have potential to have more of a boom before we have the recession. but we do have to recognize that the more likely it is that we have a booming economy, we also pull risks of a recession forward. but that's normal. that's just a normal business cycle. >> you know, we're about ready to get our employment figures, whether it's adb or bureau of labor statistics wednesday and friday of this week. if you look at last month, the

conventional unemployment rate 4.7, u6 was 9.2. knowing which of these is really supposed to be paid the most attention to could have a big impact down the road as far as are we at full employment or not. your thoughts. >> so, i think it's time to change our style of looking at the unemployment report. i think we need to focus more on the u-6 measure of employment. you know, the u-3 measure, the 4.7% that you had mentioned, that's really a function of the labor force participation rate, people falling out of the labor force. i think the number above 9% might be more representative. i think what we're going to find in more economic data, more people speaking about the economy, is they're going to focus more on the u-6 number of employment. so you know, i would argue that, yes, by traditional measures, we may look like we're at full employment, but the reality is, is that you know, the workforce still has a long way to grow. i think the u-6 measures are probably more relevant right now. and i think that's what we need to start looking at. >> you know it's going to be

huge to see if we can pull workers back into the active labor pool with regard to the difference you just explained and talked to, and many don't believe that's possible. i personally see demographics as contributing, of course, to the workforce participation underperformance, but i think there's many more channels into that number. thank you for taking the time today, jim. david faber, back to you. >> all right. thank you very much, rick santelli. now let's send it over to jon fortt for a look at what's coming up on "squawk alley." jon? >> david, we're going to continue to track tech's reaction to this immigration ban affecting citizens of seven countri countries. tech's not pleased with this one. also, snap inc. looking to file for an ipo this week. looks like the listing will be here at the new york stock exchange. so what's that mean for ipos going forward? and of course, continuing to watch these markets. the dow down just over 200 points. major indices down 1%. nasdaq off nearly 1.5%. all that and more coming up on "squawk alley." the greatest population shift in human history

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between immigration and trade with mexico, it's fair to say that no state has more on the line under president donald trump's agenda than michigan. that's where we find our scott cohn this morning. he joins us live from detroit with more on the impact. good morning, scott. >> reporter: good morning, sara. remember, michigan is a border state. canada's behind me. and this state is international in many other ways as well. in fact, no state other than california accepted more syrian refugees last year. so last night's protest at detroit metro airport was not abstract here. in fact, for some of the people here, this really hits close to home, like vala zayeen, a u.s.

citizen from syria. >> i came here seven years ago. i got married and moved here. this is my mother. she moved here about one year ago after the war. i applied for her. she has a green card and my father also has a green card. he's actually outside of the u.s. right now. >> reporter: she got her master's degree here, teaches college math. for her father with a syrian passport but with a green card, his fate is very much up in the air right now. and then there is michigan's major situation with trade. behind me, the ambassador bridge. that is part of the biggest truck crossing, busiest truck crossing on the u.s./canadian border. 1.5 million trucks last year. but michigan is also deeply intertwined with mexico, an important part of the auto industry supply chain, and michigan is smack dab in the middle. >> we send a lot of parts back and forth to canada, a lot of vehicles back and forth to

canada and to mexico. so the trade in the motor vehicle industry is very important both in terms of imports and exports to michigan and other midwestern states. >> take a look. no state has more at stake with nafta than michigan does, but the treaty still very unpopular here. >> scott cohn live from detroit. thank you, scott. and that's it for us here on "squawk on the street." dow down 208, tech getting slamm slammed. that sets us up nicely for "squawk alley." carl, over to you. >> sara eisen, thank you so much. good morning. it is 11:00 a.m. on wall street. a lot going on, dow down 209, s&p down a full percent for the first time since -- well, in 74 sessions. and this is the worst day for all three indices since october 11th. mike santoli joins us here at