your day. americans love cottage cheese, but it's so boring and there's no flavor. >> how do you make it less? put flavors in with it? fruit flavors? >> a bunch of flavors and cool packaging. >> good culture. >> yeah, the brand. thank you. >> thanks, guys, appreciate it. >> wow, man, all right. that went fast. happy friday to you guys and to you as well. make sure you join us on monday. "squawk on the street" is coming up right now. ♪ good friday morning. welcome to "squawk on the street." i'm carl quintanilla with david faber and jim cramer at the new york stock exchange. dow flirting with at least breaking that streak. futures lower on disappointing retail earnings, dollar at a one-week low, europe mostly red, dax down about 1.5%. ten-year 2.33 now. and watch gold at a three-month

high. our roadmap begins with the trump stock market, the president signaling some support for a border adjustment tax. futures point to a lower open. can the dow continue the longest winning streak since '87? >> plus, we'll keep our eyes on retail. nordstrom shakes off trump tweets, but jc penney's turnaround seems to have stalled. the retailer is closing 140 stores. >> and a big 10% revenue decline at hewlett packard enterprises. meg whitman is going to join us live. first up, futures lower after the dow hit that new win streak ten days in a row after the president gave an interview to reuters following his day with manufacturing ceos. he says, quote, i certainly support a form of tax on the border, could lead to a lot more jobs in the united states. of course in january he said it was too complicated. sean spicer yesterday pushed back on the idea that it would result in rising consumer prices. who knows. did immelt get his ear in that meeting yesterday? >> i don't know. interest rates keep going down. and at a certain point we start

thinking maybe nothing's going to get done and that's why interest rates keep going down. i also felt that yesterday there was a rotation into health care. based on absolutely nothing. but you didn't want to see that rotation given the fact that most of the rotations have been at least earnings oriented to some degree. yesterday we had nothing really good on earnings. this morning we come in and, gee, i got to tell you no one is going to the mall in february. no one. so we're back with border tax hurts retail and consumer is missing in action. >> you know, i've tried to do reporting around this. of course you can never come up with anything definitive in terms of what's going to actually happen with the border tax adjustment. you can speak to people close to the administration. you can speak to people frankly who've had an opportunity to talk to the president at mar-a-lago when he's sitting and reading at the club and they might have asked him about that. >> okay. >> it's not clear to me that when he says he wants some sort of border tax it means the same border tax that is in the house ways and means blueprint.

>> okay. >> it could well mean that he wants the ability to have some sort of retaliatory tax, which by the way may still be on the books, where he can apply certain taxes and/or tariffs on particular countries that are not being fair traders. so i just don't know. when you speak to people who are close to senate finance, when you speak to people who are involved at both the house and senate level on tax reform, many of them believe the border tax is not going to make it. >> okay. >> that it's more or less dead. and even if you were to get strong support from the administration for the particular destination based tax with border adjustment that was proposed by brady and ryan in the house ways and means blueprint, it's still not clear you could get it through the senate. so i got a lot of people who are saying border tax as it currently exists is dead. and maybe the president is

talking about something that's a bit different. >> yeah. here's more of the quote. i don't consider it a tax. it's a tax if companies are buying their product outside the u.s., but if they make their product in the united states, there is no tax. so what is going to happen is companies are going to come back here, they're going to build their factories and they're going to create a lot of jobs and there's no tax. that's his world view that production repatriates and this is not an issue. >> well, it would be great -- it's great theoretically. but those jobs -- when you look at what's bought at a walmart, a lot of that stuff long ago left here. those manufacturing plants. and this is not going to make those plants come back. it just won't. it's not enough incentive to start building plants even heavily automate that had can make the stuff here. >> but that's the key to the house plan. >> i know. >> as we sit here is to bring the supply chain back to this country. and then therefore the jobs that

would conceivably come along with it. >> but, yeah, okay, that would be great. >> again, for the most part people seem to think it's just not going to happen. now, paul ryan may feel differently and perhaps people are giving him credit as a great politician. >> right. >> as well. and as somebody with a lot of power that they're not willing to say it's dead. and maybe trump and the administration if they throw their full support behind it maybe it won't be, but i got a lot of people who seem to be pretty well informed who say huh-uh. >> we have a lot of people come on air and say, look, we've got brady and ryan, it's all set. it's all set. >> yeah. >> i mean, nothing is set. go read constellation brands cfo last night. a mexican beer. listen, we got to make it mexican. they remain committed to making mexican beer in mexico despite the tax. okay. you know we're not going to make beer that's in mexico in flint, michigan. we can't do it. flint's a great place. milwaukee makes good beer.

but we can't make corona in milwaukee. now, i know people say, wait a second, heineken's made here. no, but if you're importing mexican beer, you can't import mexican beer from milwaukee. doesn't work. >> it's not just beer makers in mexico, it's refiners here in this country importing. >> have you seen how hard it is to understand that? >> i know. but there are so many different constituencies, not to mention retail. but we'll keep talking about this. we'll see what trump says when he addresses congress. >> and today at cpac. >> and today at cpac whether he puts more meat on the bone in terms of what the administration is really looking here in terms of tax reform. we didn't get it from mnuchin yesterday. >> no. it is amazing one of the hallmarks from what you wanted from trump was no accountants and no lawyers. at one point he was saying, listen, i'm going to make it so h & r block, forget them, the idea tax was simple, i have tried to go over what it would mean for a pipeline company. what it would mean for a natural gas company that transports natural gas to mexico.

frankly, i have to hire people i can't afford just to be able to try to speak on this show. i'm not going to do that. i'm not going to take a beating. >> that would be good, right? if you're transporting natural gas from this country to mexico, everything is tax free. >> yeah, but pipeline -- the pipes come from mexico. >> for now. >> yeah, we're going to get that u.s. steel pipe. put it this way, i studied tax code for a long time at law school. i was actually like the corporate tax guy. and it was really incredibly hard -- it is ten times harder now and this would make it the hardest thing i've ever seen. what do you do with those sunglasses i buy from dollar tree? >> which is why a lot of people think we're going to end up with a tax cut that is essentially a lower rate, a repatriation deal, maybe 10%. >> bye, bye, bye. that would turn around even nvidia. >> you think so? that's not accounted for in the stock market as of now? >> not in the stock market. a lot of people hate me for nvidia. >> i'm getting your hate e-mail

too. >> i said let it come down. let the hot money come out of nvidia. two guys down there great yesterday giving it the business, you know? let the hot money come out. >> moving deeper into retail, that uncertain tax policy, we did get numbers from jc penney, nordstrom, gap and foot locker. penney revenue miss, foot locker beats but warns 2017 may be a challenging environment. nordstrom, the recent target of the president beat on the bottom line. stocks up in the premarket, but the store closures at penney getting most of the press today. 130 to 140 stores, two distribution centers. it's less than 5% of sales. but as the street said, jim, giving up to a large degree on suburbia. >> i think this is one of those things where you start thinking, okay, what are these malls going to look like? we know the mall traffic from l. brand yesterday is bad. tell you go through the gap store conference call, traffic continues to be tough.

it's going deeper than that. art peck the ceo talking about how bad traffic was in february, significantly deeper. so you're talking about malls that are going to be ghost towns that we're not going to go to. and i think that when you see the prime jc penney, gap stores, l. brands, mall businesses and you say to yourself, wow, what would happen if the mall just has like blank space, blank space, blank space? are you going to go there? >> i don't go anyway. >> could you -- think outside yourself for a second? >> no, i'm not capable of that. >> is it a win for macy's? in other words, first strike advantage. we're going to go heavy on closures. >> i think macy's was the big beneficiary of the fact they never put money into infrastructure and finally closed stores. there's a line at nordstrom and i'm not crazy on nordstrom, i don't know about the returns there, but one point nordstrom says, shows you how bad retail is, we make money at our 120 stores. they make money. can you imagine being in a

business where someone is like you guys don't make money? he says, no, actually, we do. so many stores don't make money that i think it's incredible that it's news that nordstrom's ceo says our stores make money. >> although you have said consistently stay away from the mall. i mean, l. brands yesterday. >> no, look, i like lucky strike as a concept for the mall. >> bowling, right? >> bowl right down the middle of the mall. >> so many lanes unbelievable. lucky strike. >> that was your point, i guess. >> yeah, you got that. >> took me a minute. >> we have meg whitman on, she ought to go into a little mall business. >> she's ready. ready waiting for us. >> what, because the stock's down? >> it's down a little bit, yes. you'll be able to ask meg questions along with all of us. >> meg is miked up. we're going to get to hp enterprises ceo after the break, exclusive after earnings last night. look at premarket gains for s&p and dow look safe for the week, but the futures are weak at the

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meg whitman, always with us each quarter rain or shine, which we always appreciate, meg. a bit more rain i would say this quarter. you talked about fx of course hurting you and hedges rolling off and therefore becoming more expensive, you've talked about the increase in memory prices, you've talked about some execution issues as well, as being responsible for the change in guidance. what gives you the confidence though that in fact as you said many times on the call you can see growth again as you head into next year? >> yeah, well, let me characterize the quarter. it was a mixed quarter. good news as you mentioned we delivered eps at high end of our guidance and better cash flow than we anticipated, but revenue was light. and there were a couple headwinds, one was the market is soft for sure, but secondarily, foreign exchange and commodity prices and actually commodity availability in the form of

memory. so the reason that we decided to take down our guidance was around foreign exchange, very different than when we announced the budget for the year, which was at our security analyst meeting last october, the euro's moved from 110 to 105, as has many other currencies like the yen and memory prices are up 50% in january and supply is constrained. i think we're getting more than our fair share of supply, but it's tough. here was the decision i had to make. if you've got that kind of pressure around $300 million of pressure between foreign exchange and memory, what do you do? do you go find that $300 million somewhere in the organization? or do you say, you know what, i'm going to keep those investments in failed selling costs and keep those investments in innovation which have been paying off for us, and that's what we decided to do. that's why we took guidance down. listen, i think what will be the remaining company, the go forward hewlett-packard enterprise, that business will grow in 2018 with the possible exception of caveat tier one

provider service which didn't materialize as we anticipated in q-1, and we'll see what happens in q-2, q-3, and q-4. >> overall servers down 12% for the quarter, meg, and that has concerned a lot of people who come back and simply say, listen, you know, the cloud model seems to be the way things are going. and it's taking a lot more share. so you're in a shrinking market as it is for servers. and it's not going to do anything but keep going down. >> yeah. it's a declining market, but it's not declining as fast as our servers declined. and so what are we doing about that? we've got new leadership in the united states. we've got new leaders in across the board. we've really, you know, streamlined our cost structure, and i think we're going to do a lot better in core iss in q-2, q-3 and q-4. and then great new server

products whether that's synergy which i think gives companies a chance to have on pram, private cloud economics that's a game changer and seeing great momentum around that. we've got high performance compute. our high performance compute combined with sgi we bought at the end of last year with the explosion of big data and analytics, the buying of high performance compute it's already a $12 billion market growing 6% to 8%. so within servers there's pressure on, you know, rack and tower, but there's other segments growing very nicely. and that's our strategy. let's find those pockets of growth, let's go after those both from an organic innovation as well as inorganic like sgi. >> meg, jim cramer, good to see you. thank you for coming on on a tough day. >> yeah. >> i understand stierentirely t currency. i understand the dram spike, i get that. but what i don't expect from meg

whitman is there are execution issues involving changes in management. i did not expect that from you. my travel trust has a small position in this thing. it threw me off, meg, to hear you say, listen, maybe we made too many changes. meg whitman executes. that's what she does. >> yes. >> you didn't. what went wrong here? >> well, you know, actually in truth we probably loaded a little bit too much on our senior people. so think about what we were doing this quarter. we hit the most intense part of the es separation, the beginning of the software separation and then the really intense part of setting up hewlett-packard enterprise as a go forward entity post these spins. so honing the strategy, getting it fit for purpose, streamlining the organization and reshaping the organization so that we could compete with this new strategy around make i.t. simple for customers, we power the edge and have the services to make it all happen. i have to say we might have just overloaded people. we had a lot of people in new jobs. so as you know i pride myself on execution. and it wasn't perfect this

quarter. there's no question i have pushed this organization to probably the limits in terms of their ability to accept and create and deal with change. the good news is when the dust settles this makes us a much stronger company. so it was absolutely the right thing to do. but i might have loaded a little too much on in q-1. >> well, we should remind people of course enterprise services, that deal with sce expected to close in april, april first. and then the software spin as well later this year. that's going to leave about a $28 billion revenue company that you're running. but, meg, you know, there is still questions about the business that you'll be focused on. i'm looking at j.p. morgan note this morning saying cisco enterprise orders along with yours suggest larger businesses are sidelined on spending due to macro and policy uncertainty. is that the case? >> so there is -- you know, listen, around the world i would say the macro economic environment is uncertain.

and uncertainty for business is never a good thing because then people say, well, really do i need to refresh that data center, should i make that next investment in modernizing my infrastructure. so uncertainty is not our friend, but i'm not terribly worried about that. i think we've got the right product line. we've got a set of new products. we are now organized to deliver sbens a much more focused business. i mean, think about this, when i came to hp we were running $110 billion company with seven major lines of business selling in 170 countries with 250,000 value added retailers. when this is all streamlined and focused, it will be a $28 billion company, higher margin, higher revenue growth, much better return on invested capital in really three major lines of business in a much more focused and directed way. and then all of our capital will go towards that one strategy. and remember we've taken this company from $12.5 billion of net debt to by the end of the year there should be about $11 billion of cash on the balance sheet.

so it's a much healthier company. and we can deploy our capital allocation to the highest return on investment, whether that's share buyback or whether that's the kind of acquisitions that we've done, aruba, sgi, most recently simplivity. these are strategies for hybrid as well as powering the edge. don't forget about our partnerships. we are leaning hard into new technology. and i've got a lot of confidence that this strategy is the right strategy for the company. and it's going to pay dividends. q-1, we'll look to next quarter. >> well, we understand that. meg, finally, we've talked a lot here and in fact started our show talking about tax reform specifically border tax adjustment and whether or not that is going to be something that becomes a reality. where does hewlett-packard enterprises stand on that? would that be good or bad for your company? >> we're very concerned about the border adjustment tax or what people call b.a.t.

the border adjustment tax is not good for companies that have a relatively low margin with a supply chain that is outside the united states. so we could certainly assemble in the united states. we do in chippewa falls for sgi, we do in houston to some degree for our enterprise group. but the entire supply chain, everything from memory, from mother boards, everything that is in our products comes from overseas. by the way, that supply chain has taken 30 years to set up. so when all those components come in and are taxed, it's not going to be good for companies that have a relatively low margin and a big offshore supply chain. and you mentioned the retailers. so there's a number of us that are pretty concerned about this. we're working closely with, you know, the congress and their staffs to make sure that our point of view here is well understood. because my view is this actually does not create jobs. it actually lowers the number of jobs for many, many companies.

think about it, retailers are some of the biggest employers in the country. a lot of the technology companies like us are some very big employers here. and my view is this is not going to be the right thing in terms of creating jobs for middle americans. so we'll see. we'll make our voices known. and we'll see what happens. >> yeah, well, to be continued, meg. and of course as is everything involving the company as well, but always appreciate your willingness to talk to us each quarter. thank you. >> thank you. >> meg whitman, chairman and ceo of hpe. >> we'll get to cramer's mad dash and count down to the opening bell in a couple moments. take one more look at the premarket. looks to open lower. more "squawk on the street" from the nyse straight ahead.

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s&p still on track for the best month since march of last year. dollar pairing some of its losses this morning. we'll get the opening bell in just a few minutes. runs on intel?

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you're watching cnbc "squawk on the street" live from the financial capital of the world. the opening bell in just over a minute's time. let's get cramer's mad dash on this friday. >> you know, i'm looking at foot locker because a lot of people have disappointed in the mall. some stores have been better than others, but foot locker is the one that has it. they had 0.5 plus comp looking for 0.49. all the big institutions need to own some retail, because retail has some representation in the s&p. it's going to keep gravitating to this. by the way, i keep hearing the same thing, which is that nike is doing better. this is a third call now that nike's doing better. nike will be down with the rest of the market because it's part of the s&p, but keep it in mind that foot locker sees strong nike, nike's starting -- i had nike manufacturer on last week saying nike is doing good. maybe that's a place to go,

where you run from the mall. >> on that note happy birthday to phil knight, 79 today. today is also the day that steve jobs would have turned 62, two business titans who've changed their businesses. s&p at the bottom of your screen. at the big board the new york economy -- [ bell ringing ] things folks will be watching at the opening are some of the infrastructure names, got hit yesterday on diminished hopes of a near-term package. >> yeah, you know, it's funny because some of these companies are doing so well. i know it's not a big company, but a company called maz tech, they reported a quarter unbelievable. true infrastructure play. it's up nicely today. don't give up on the ones that actually have good business now, but yes, i know there are a lot of people who listened to mnuchin's interview and came back and said, well, maybe we're not going to have that $550

billion infra -- what was surprising is did anyone really think we were going to? >> i think there was some hope before he took office because it was discussed a lot during the campaign. remember, trump talked about the terrible state of our airports and so many of our public -- >> relatively bipartisan some argued because of the jobs component. >> yes. >> but we haven't even repeal, replace. the cue is so long. last night the opening on "mad money," i said listen you may think this whole thing's a trump rally but brazil, russia, china, mexico doing great. other countries doing really fabulously. do not just think that everything that is happened here is trump. and please do not think that infrastructure is top of mind. >> no. you mentioned all those even europe doing better, right? >> europe's incredible. >> i mean, spain. >> spain's doing good. by the way, those british banks, not royal bank, but lloyd's,

barclays, credit suisse making comeback. did you see the unit deal for italy -- that's a pathetic bank. these are banks you wire money to and it's like, uncle billy, right? uncle billy is like, please, please. no, doing okay. so, yeah, europe is good. europe is good. >> jim, not to beat a dead horse, but nvidia, micron, broadcom, what do we do here? a lot of technicians saying the charts are not encouraging. >> well, we had this before. we had it with skyworks when skyworks had its big u-turn in the 70s. these are momentum names, try to rally at the beginning of the year, they're coming back down. some actually give you terrible forecast last night so that actually has a reason to go down. intel's directly taking aim at nvidia, that's part of why brian krzanich came on "mad money" last week. i say you got to let these weak holders come out. if you try to make a stand ahead of when they're freaking out,

then you're going to end up buying these stocks too high. broadcom had an amazing quarter and got the wireless charging from apple. everything's going great there. nvidia, yes, intel's decided they want to come in very aggressively and they want to try to drive them away. but if you take a look at what they're doing in terms of cars, nvidia great business, gaming still great. >> right. >> these are momentum stocks. and when the momentum comes out, you got to wait until they settle. you can't be a hero. >> speaking of -- >> nothing's wrong is what i'm saying. >> nothing's wrong. speaking of chips, the hp focusing on the increase in dram. >> that was the micron. >> has that run its course already in terms of being reflected accurately in the stocks of those companies? >> if meg's right that we are going to have moderation, then yes, micron's not going to go up more. but when i listen to what people are saying about flash and what people are saying about dram, you're not going to have just a rollover. but i know her confidence those prices are going to come down is

going to freak people out in micron today. these stocks are boom bust stocks. they are all doing well. people have always tried to anticipate when they're not going to do well and get out ahead. i come back and say if you go over the hp sister company, business is better so the component makers are going to do better. but these are battlegrounds and you got to let -- don't get into a battleground until you see what the sellers finish. that's why they moved through to health care yesterday. there's no battleground anymore. not with brent saunders saying, hey, trump, please regulate our business. you see that? please regulate our business. odd. >> speaking of regulation and business, goldman is the worst performing component on the dow. we don't usually mention barrenberg but they cut to a hold. >> saw that. >> arguing a lot of this policy expectation is baked in. >> well, you know, look, we've run a great deal. there was going to be a day when you decided that they were going to sell these stocks.

goldman is an inexpensive stock historically. not on book but on earnings. if you get those rate hikes then goldman's going to be a buy. nvidia, nothing is wrong just the chart and hot money. >> right. >> micron's boom bust. that 50% spike in dram prices was not as boom. >> talking about the banks, jim, what a difference a year makes. think about where we were a year ago with many of these banks. remember the liquidity in the marketplace we had roughly a year ago? concerns about more fed rate hikes, where we were going to be -- >> on the books, diamond bottom. >> worries about the european bank. >> deutsche bank this week we were concerned about deutsche bank. >> and now we're talking about multiples above book value for the first time in a long time, not to mention many of the regional banks. >> easy to talk to people of bank of america, we should trade at book. and michael doing great job as ceo at citi, they're still three

bucks below -- actually, make that four bucks below book. it's a different market because if we get to three rate hikes these companies will do very well. again, i want to emphasize, advance micro, nothing wrong with the core business. intel, nothing wrong. nvidia, nothing wrong. but you have to be willing to take some pain. and most people who are in nvidia when it was up 225% last year and have been liking it since 30. i was talking to my wife like what are we supposed to do, thread the needle, get out at 115. if you like nvidia, you don't wake up and say you hate nvidia. >> why do you keep coming back to nvidia? i can go to goldman sachs and you're talking about nvidia geb. >> nvidia is the metaphor. there's nothing wrong other than brian krzanich has had enough of nvidia. he told me that. the ceo of intel, i've had enough of you at nvidia, and he's a soft spoken fella. >> one time intel had enough of amd, look what that stock's done

over ten years. >> i remember when intel didn't want amd to go under because the justice department would call them. remember justice called microsoft steve ballmer, put him on hold? >> try. >> let me get back to you. >> justice department line one, tell them i'm jammed. >> that went on for a long time. hp shares are actually losses not quite as bad. looked down 9.5%, now down call it 8.5%. we heard from meg whitman so many things involving fx -- >> that was a bad call. >> dram prices which we've already talked about moving up dramatically. toni on the call said didn't you know. >> he's become the great -- the

grand grand -- >> and the execution issues you talked about as well. something we talked about did at the top of the show is the border tax given the president's comments to reuters yesterday what was he really referring to. but as we were saying earlier, there's a lot of opposition to the idea of a border tax -- border adjusted tax. and you can add hewlett-packard enterprises to that long list. here's meg whitman on why. >> the entire supply chain, everything from memory, from mother boards, i mean everything that is in our products comes from overseas. by the way, that supply chain has taken 30 years to set up. so when all those components come in and are taxed, it's not going to be good for companies that have a relatively low margin and a big offshore supply chain. >> there you have it. >> great quote, 30 years. >> kind of explains it to a certain extent. 30 years to set up a supply chain, how are you going to move it back in let's call it phase in over three years.

>> i don't know, but my border tax one that i look at is constellation up four today when people realized that, again, i don't think this border tax happens. constellation being the one that you really -- i mean i know people say you can make mexican beer in delaware or whatever, but that's the one to watch. that's the pro and con tax. that's like the barometer of border tax. border tax must be doing well, corona, border tax doing badly, modelo. >> got it. >> hpe i've been trying to convey, travel trust owns small part, it's in no-man's land. >> right. >> that's where it is. it's kind of verdant. >> a lot of people working the numbers on what will be hpe after the spin of enterprise services to cse and software business to microsolutions which will take place in the fall. what are you left with? what are the numbers? to her point $28 billion and she feels like they're going to be able to grow. >> and $8 billion --

>> cash they're generating a good amount of free cash. >> but, david, she is so good at the nuts and bolts, but this was a quarter where she spent a lot of time talking about reshuffling of people. >> yeah. and said they put a lot of demands on people in terms of dealing with these spin-offs and maybe not enough therefore was able to be focused on just -- >> like my offensive line coach didn't do that good of job because he was not sleeping well? you know, my linebacker coach didn't deliver this -- you know, the guy i didn't like my strength and conditioning coach was overstretched? >> it happens. there's usually some churn. >> yeah. >> lower level coaches. >> okay. >> one last thing here, jim, you mentioned retailers all leading, nike, dollar general, urban and gap, which by the way does see comps likely up this year. that would be the first time in three years. is this gap halo or more border adjustment? >> gap said something that was really extraordinary. they said that women's dresses

were strong. that's the first time i've heard anything positive about women's dresses in 18 months. but they've closed 75 stores in 2016. so they're closing the ones that aren't doing that well. they still have -- they have very good talk about the brand being good. that said, if you're buying it here, you'll probably sell it at 25.50. it wasn't a call that inspired. it was just a call that said maybe i shouldn't sell the stock. the company -- another company that didn't do that well that people love is intuit. i mention intuit because intuit talked about how tax returns the whole season is much slower, it's down 13% year over year, which is a lot of these retailers are saying maybe that's why february is bad because of the tax return is slow. >> yep. >> but intuit itself is taking big share and killing it. and it's a great company. it's a really smart company. i don't know if you guys use their stuff. >> a lot of people do. >> i love it. i love my wife. >> i'm glad to hear that. >> dogs.

>> also like intuit. >> do you love your dog sns. >> i can attest, yes, he does. >> kind of gave you this. >> dow's pairing its losses. it's the worst day of the month for the s&p, but nowhere near being the worst of the year. let's get to dominic chu on the floor. >> carl, i will say for the record i like my tax return software, but i do love my dogs and my wife as well. anyway, like you said, dip buyers at least try to prop up the market here. dow's only down about 40 points at this point right now. noticeably though with these indices moving to the downside so far to start and then try to get a little bit of traction here, we want to focus on a few key hot spots in the market. some of those battlegrounds perhaps like you were talking about earlier on in the program. jim cramer just mentioned some of them. the defensive names are leading today, maybe no surprise there. utilities, telecom, health care, more defensively oriented sectors outperforming the more cyclical ones. you guys mentioned goldman sachs being a laggard today, technology, financials, some of the ones really dragging things down. i want to focus specifically on secnology because the s&p 500

technology sector broke a 15-day winning streak yesterday. so it was noticeable. it wasn't down big, but still something to pay attention to. it was the best performing sector year-to-date before that point, it still is clinging onto that title. we'll see if that battleground heats up again. also want to look a couple more places. dow transportation stocks 2% off recent highs, two-day losing streak, maybe a three-day one here. some people look towards transports possibly a leading indicator. also want to focus on small cap stocks because russell 2000 also showing relative weakness to the overall market. that's the reason why some traders here a bit concerned about what's happening. we'll see if volumes justify that overall. a couple other hot spots to keep an eye on from macro big picture perspective, gold prices highest level since mid november. that streak continues. a little bit of dollar weakness recently has been fueling commodities higher both oil and gold. but gold and gold mining stocks check out what's happening there keep an eye on that one. and i will end on this, ten-year yields watching right now

1.34 -- 2.33 right now. we are seeing a bid to treasuries, safety trade perhaps being part of that story. it will be something to watch as the trading day progresses, guys, back to you. >> thanks very much, dominic chu. let's get to rick santelli and check in on the bond pits at the cme in chicago. good morning, rick. >> i have one phrase, shots heard around the world. all right. let's look at a one-week of the schatz, the european two-year, the german two-year, getting close to minus 100 basis points. that's all you need to know today. i know there will be many looking at stocks. they've had a huge run. they get a day of rest. but what's going on with politics and what may be going on with the market, don't confuse that with signals about the treasury complex because pretty much if you look at the ecb, you know, we used to ask what-if questions when i was young, things you never thought would happen. i remember the big question, what if the cubs ever won the world series? well, they did.

maybe the new question for those in finance is what if the ecb gets in deeper trouble? or who backs the ecb? you know probably all roads lead to a printing press, but i think at this point with the italian banks owning the ecb, hundreds of billions of euros, that this is a question somebody ought to ask. now, if you look at a year-to-date of the schatz, it's breathtaking. it really is. if you look at it since july of last year when everything made its historic lows, from treasuries to at that point schatz, bunds, you could see the deterioration. look at bunds from that july '16. look at tens. there is little doubt. you know, some of the people on the floor say, oh, it isn't a relative value trade. i don't care what you call it. what it is is their markets, their policy, their bad policy affects ours. where could this go from here? other central banks are going to keep things more liquid, more ultralow to help the ecb. so what? we then fully memorialize all of their problems?

think mike ditka here, we should be going the other way and cleaning up economically. we really should. because i don't see any way out for mario draghi on this one. and finally, here's the other really odd thing today. you would think with the markets in europe plunging in terms of rates, rallying in terms of price that the currency would be toast, but it really isn't. now, it doesn't look spectacular, but a one-week chart shows it's holding up pretty well. you know, when we used to trade these are the ones you scratch your heads on. is it giving you a chance to sell it or trying to tell us something we're not quite on top of yet? i'm sure as the day progresses we'll know. being a weekend, i'm not sure if that helps or hurts the situation. i most likely think it hurts it a bit. gang at the desk, jim, dave, oh, my god, carl, how could i forget the most important guy there. >> it keeps changing every hour. rick santelli, thanks. when we come back -- >> can't stop thinking about the schatz, sorry. >> we'll get fresh comments from

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less than a week away from the snap ipo. tomorrow the nyse will conduct a test of its system with traders sending sample orders. pivotal research meantime out with a new note saying forecasting future revenue growth is challenging comparing snap's revenue model to the tv business. the few notes we've gotten on them have been all over the map. >> yeah. i don't know. talk about price with snap there would be a level where it's interesting. when you talk about with people all they come back to is say, listen, i know it's not facebook but it's better than twitter. i know that's not the narrative they want. not the narrative anyone would want, but it's a place people are willing to look at apps and doesn't break up the train of thought like it would be on

twitter where if you're tweeting and look at an ad, you might make a mistake and have to live with it. >> yeah. meanwhile, jack dorsey giving an interview to axios, doing a bit of a victory lap on square. >> square quarter was fabulous. the cfo amazing, we like the square product. i know the square product from my bar. it's a great company. that's why just so great for jack to say we did it. i got to go over to twitter now, fix that one. >> not going to happen. >> no, not at all. no one listens to me. >> no. >> it really is. i feel like jackie gleeson at this point. no one listens. rodney dangerfield. no one. no one listens to me. no one. >> i didn't hear that. >> we'll get stop trading with jim in just a moment. dow now down 40 points. the future of business in new york state is already in motion. companies across the state are growing the economy, with the help of the lowest taxes in decades, a talented workforce, and world-class innovations.

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fantastic way -- method. they're a great driller. i can tell you when you talk to companies big in the permian or in the scoop and stack in oklahoma, these guys' rigs are in tremendous demand. i love this call. helmerich & payne may be the best of all the hps out there. >> nice one. >> i like that. well done. >> you like that? hey, i can play the game. >> what's on mad tonight, jim? >> you know, sometimes you have these companies they're just fascinating to me. live nation, they own most of the concerts your kids go to that you can't stand them going to. well, you know, you ever see these concerts? >> of course. >> and then bob sulentic of cbre, what a quarter they had. commercial real estate on fire worldwide. we're going to talk about europe and asia being strong too. not just here. but live nation, i've paid fortunes to live nation. fortunes. >> i think of all the mall real estate they can now have concerts in.

>> oh, gymboree. >> big parking lots, take in a lot of people. it could work. >> bowling and concerts. look, i want the malls to do better. i want everybody to do better. i want nvidia to go higher, okay? nvidia. and i love all the hps. everybody who's an hp i like. >> just glad you didn't mention nvidia on the show at all. >> not that viewers were asking for it. >> can you -- by the way, they got rid of the intentional walk. but you can still do an hbp. >> you can still hit by pitch, yes. >> right. >> we'll see you tonight. good weekend, jim. "mad money" 6:00 p.m. eastern time. when we return the national association of manufacturers ceo jay timmons after the president signals support of some kind for some form of border tax. what that means for american workers and business. and then of course the president going to cpac this morning expected to begin in just a few moments. we'll take you there live after a break. ♪

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welcome back to "squawk on the street." i'm carl quintanilla with mike santoli and david faber at the new york stock exchange. sara is off today. dow going for a record closes in a row. president at cpac watching the ten-year as well fell to 2.33. roadmap starts this morning with president trump speaking moments from now at the conservative political action conference. we will take you there live. >> stocks hitting a snag sliding a bit making it the worst day of the month for the s&p but off the earlier lows. >> and big winners, we'll unveil the ceos who've made the most money from a rally in their own company's stock since the election. >> let's get to rick santelli. >> well, we are looking for a number on january's read of new home sales to be around 575,000-ish. we ended up with 555,000, a bit of a miss. that's from a revised 535,000. so a miss no matter how you slice it even though

sequentially of course it's a little bit better. it's up about 3.5% or more. but the last look that 535,000 is pretty darn weak. that was about the third weakest of last year. now, let's move to maybe what's the most important number, a group of numbers that's really trending, that's confidence numbers. so our february final read on university of michigan comes in at 96.3. 96.3, that's not bad because our mid-month look was 95.7. so that gets tossed. sequentially you're looking at 98.5 in january, which by the way was the best in 13 years. yes, 13 years. and then it's followed, as i said, by 96.3. we see yields in the u.s. at the lower end of the closing established 2017 range, but it is fighting a bit. and many would say it's kind of shadow boxing the real dynamic, which is in europe. carl, back to you. >> all right, rick, thank you very much.

yesterday it was two dozen manufacturing ceos at the white house. moments from now the president himself will deliver remarks at the conservative political action conference. our kayla tausche is at cpac in national harbor, maryland, and joining us with more. good morning, kayla. >> reporter: good morning, carl. the president has arrived here in the national harbor at this convention center where cpac is being held. it is standing room only in this ballroom. an announcement came over the loud speaker moments ago saying if you leave the ballroom, you can't get back in because people are shoulder-to-shoulder here awaiting the remarks from president trump. it's been a packed conference so far. yesterday the chief strategist to the president steve bannon talked about economic nationalism, about bilateral innovative trade deals that they are going to be inking to take back jobs for the people, take back american sovereignty, which is a different tone than we are hearing from this wing of the republican party. which almost resembles the libertarian wing of the party. so we took to the registration and to the convention floor to ask some of the attendees about

the business agenda of trump and if it doesn't align with the convention topics of years past, what are they hopeful about and what are they potentially fearful about. take a listen. >> as a small business owner, we want opportunities to have less regulation. and trump has promised he's going to create jobs for small businesses and create opportunities, so hopefully he follows through on that promise. >> i am a little bit concerned that trump pulled out of tpp. i do support free trade. i am a little bit concerned. i think we're giving the region to china. >> i'm a mom of a son at a federal service academy. he's a senior at the academy and during the election i decided i dn didn't have to like trump to vote for him. i knew he was going to do a better job. i knew it was time for a change. >> reporter: the president is no stranger to this convention though. he has spoken here. this will be his fifth time addressing the audience here at cpac. in 2011 when he sowed his

political seeds, he was booed when talking down some republican senators. in 2015 he talked about the fact he would be the only candidate able to beat hillary clinton. he skipped last year when he was a candidate. and he came in third in the straw poll. so this, guys, is a bit of a victory lap for the president. >> indeed, kayla. and when he begins to speak of course we'll take you back to cpac in national harbor later on this morning. kayla, thanks. well, this morning as well the border tax debate continues. president donald trump weighing in after a meeting with manufacturing ceos yesterday in an exclusive interview with reuters the president said, quote, i certainly support a form of tax on the border. companies are going to come back here. they're going to build their factories and they're going to create a lot of jobs. and there's no tax. of course it's a complicated issue, unclear exactly what the president meant with that statement. joining us now jay timmons, national association of manufacturers president and ceo. jay, nice to have you. >> great to be here. >> before we get to taxes, just listening to that gentleman that

kayla interviewed who runs a small business talking about regulation. >> yep. >> i know you guys are very much focused on that. a lot of people seem to think a lot of benefits can come simply from some regulatory rollbacks, apart from what may or may not happen on tax reform. do you agree? >> yeah, i think regulatory sanity is absolutely em perative. i'm going to give you a number that is stunning. 297,696, that is the number of regulations that directly apply to manufacturers. it equates to about $35,000 per employee per year in compliance costs. that's a message that our chairman took to the president yesterday when ceos met with the president. it was almost like a meeting of the national association board of directors there were so many of our members in that room talking about exactly those issues. >> when it comes to regulatory rollback, it's not as easy done as it is said, it seems though,

jay. these regulations were added, public comment periods, over long periods of time. >> oh, we've got 30 years. >> your expectations in terms of how quickly things can be rolled back? >> to your point this has been 30 years in the making. you've got two issues. you have the issue of looking at regulations that are on the books right now. and trying to figure out, you know, which ones need to be tweaked in order to help improve the economy and incentivize investment and job creation here. the other issue we've got to tackle is the process. how regulations are made in the first place. there's a bipartisan effort right now in the united states senate to do exactly that. the house has also passed some bills on that subject. that's going to be very important for the future so you don't have these wild pendulum swings between right and left leaving businesses completely uncertain about what the future means. >> jay, on the tax front, which seems to have been a matter of conversation yesterday in that meeting with the president.

>> it was. >> would this framework of a border adjustment tax be something that your organization would be pushing forth that didn't happen to already be in the house bill? in other words, is this the preferred way? or would a lowering of statutory tax rates and deregulation be kind of your wish list? >> well, we have long advocated for the lowest possible rate to allow us to compete globally. countries all over the world are trying to take away our economic leadership by lowering their taxes. so to your point we want to see what the whole package looks like. the president has been talking about a 15% or lower rate. we want to make sure that it is as low as possible. we want to make sure that small and medium sized businesses are part of that as well. we want to see a territorial system to encourage companies to bring their dollars back to the united states to invest and grow jobs here. but we need to look at the final package and see what it means for businesses and manufacturers in this country and how it will lower the cost of doing business

here. president's going to release his plan in a couple weeks. we have the house blueprint as you indicated. the senate has their own ideas. let's see what the final package looks like and make sure it's right for america. >> jay, we keep waiting for more explicit explanation of how automation will fit into all of this. is it incumbent on the association to explain or make clear how much of this would be repatriation of production would be autd mated and how much would be human? >> i tell you what, you just hit a subject that i'm talking a lot about right now. we're on our state of manufacturing tour. in fact, one year ago we were with rick santelli on the floor having this same conversation. and you're exactly right. the jobs of tomorrow, modern manufacturing are very different from the jobs that we might have thought about as jobs in manufacturing in the past. these upscale jobs require upskilled workers. and that's exactly what our manufacturers are doing. they're providing the tools and the knowledge to allow workers

in manufacturing to achieve new skills and to develop skills in technology and automation and robotics so that we can provide jobs in the future. we got about 350,000 jobs right now that are going unfilled in manufacturing because we don't have folks with the right skills. so to your point, as we grow manufacturing in the united states, those next dollars that are invested, we want to invest them here to build possibilities and jobs of the future and probably very different than what we're used to. >> but, jay, a lot fewer jobs in general in a new plant than would have been 20 years ago, right? >> actually, no. that's what i think the misconception is. they may not be called manufacturing jobs. the government may classify them as technology jobs. but the number of jobs are going to grow and expand. somebody's got to build the robot. somebody's got to program the robots. somebody's got to maintain the robots. that's new manufacturing.

it's just a different type of work. it's not less work. it's not less jobs. they're just different. >> all right. as long as nobody has to -- >> it's happening right now all over the country. >> understood. understood. jay, thank you. we appreciate your time. >> thank you. great to be here. >> jay timmons. >> when we come back, as you know by now stocks rallying since the election. the dow's up nearly 14% off its highs today though. we're going to discuss how much room the market has to run and the administration's impact. plus the president about to deliver remarks at cpac. when he begins to speak we'll take that live. dow's down 41. manage my portfolio. since i added futures, i have access to the oil markets and gold markets. okay. i'm plugged into equities- trade confirmed- and i have global access 24/7. meaning i can do what i need to do,

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call today. comcast business. built for business. after an historic run u.s. markets moving a bit lower this morning. dow on track to close lower for the first time in 11 sessions after treasury secretary mnuchin told cnbc yesterday that stocks are trump's report card. >> this is a market to market business and you see what the market thinks. we're in an environment where there's very attractive investment opportunities in the u.s. and i think that's reflective of the administration's goals and what the market thinks of it. >> joining us this morning, mark patterson, former chief of staff to secretary treasury lew and geithner. and brian, happy friday guys. good to see you both. mark, you can't deny what the

markets done and yet perhaps some think the treasury secretary should have shied away from that statement lest will come back to haunt him later, do you agree? >> well, it's an aggressive timeline, but whether congress can reach any timeline is really a function of reaching that agreement in that timeline. it's not if they can set a deadline. they set deadlines all the time and miss them. right now it does not appear that they're on a track to meet that deadline, but if things came together, if the president for instance strongly got behind one version or another of this tax reform plan, then i do think it is physically possible to meet that august deadline. >> brian, your note yesterday suggested that tax reform at least threatens to disappoint. >> yeah, i mean, i did -- people have accused me of reading too much between the lines of mr. mnuchin's comments yesterday. i did think it was interesting in terms of individual taxes he talked about tax cuts. and then when he talked about corporate taxes, he talked about tax simplification.

and he said it twice. so it raised my antenna, let's put it that way. and i think it left a little confusion about what treasury may do. now, i think the president in a later interview then clarified that. and he clearly talked in terms of tax cuts. so, you know, my worries from what happened with the cnbc interview yesterday morning with the secretary were mitigated later in the day. it does seem that the administration is more on track for a tax cut rather than just tax simplification. >> you know, mark, i don't know how often you talk to people on the hill these days or whether you talk to anybody close to senate finance, which it would seem to me is going to be a key area of consideration later this year for tax reform. but i'm curious what your thoughts are when it comes to what we'll actually end up with. do you think any tax reform will really include a border adjustment tax? >> we, if the vote were taken today, i think it's pretty clear it would not. again, i think the fate of that

particular proposal depends a lot on whether the president decides to weigh in forcefully on it, put the weight of his administration behind it. and even that as your network has reported there's an awful lot of opposition in certain sectors of the business community. so i think if the vote were taken today, probably not. if the border adjustability tax doesn't make it, doesn't gain traction and really too soon to say whether it will, then i think what you're left with is not a tax reform effort in the conventional sense, conventionally understood sense. what you're left with is a simple tax cutting exercise. and when that exercise it's all about what is the tolerance for new borrowing to finance those tax cuts. we don't know the answer to that yet. >> right. although this would have to be done under reconciliation, wouldn't it? i mean, again, dynamic scoring comes into the equation here. what are your expectations on that front, mark, in terms of the administration and/or the ability to get something done and have it be revenue neutral or say it's revenue neutral? >> i think it's a lot harder to do it revenue neutral if you don't have the border adjustability tax which is

estimated to be a $1 trillion offset. now, there are some signals recently from republicans in different sectors of the party that maybe the revenue neutrality goal is not the most important one. and i think history shows that when congress and members of congress are presented with a choice between tax cuts on one hand and deficit concerns on the other, they often choose tax cuts. >> brian, you know, on top of trying to handicap exactly how this goes in a legislative process, we have to try to figure out just exactly what's in the market right now, correct? so what exactly do you think currently is priced in? yesterday on the president's comments about border adjustment tax we did not see the dollar rally, but you did see retail stocks selloff somewhat. it's a bit of a tough picture. >> it's a very tough picture. i spend most of my time talking to investors in the financial sector, and i think they're holding back right now trying to gauge and game out whether tax reform is going to happen or not. so i don't think in that part of the market that it is priced in yet. so if this starts -- if tax

reform starts to gain traction, then i think there's another leg in the rally. i think there can be a boost to the market when -- if some good news comes down the road about tax reform. and i think mark was absolutely correct that, you know, if the vote was taken today, you know, the border adjustment tax wouldn't pass. but the vote's not being taken today. and a lot's going to depend on how the administration gets out and sells this. >> well, the other thing you mentioned -- could i also mention the president promised a new tax plan of his own he mentioned last week it's going to be phenomenal. i think there's a big opportunity for him there to propose something that's different, that's outside of the box. i don't know whether he'll do that. he may just resort to some tinkering with the plan he reduced -- released during the campaign. but he actually has an opportunity to release something that's outside of the box and maybe could get democratic support. that's what i think i would recommend to him at this point because it could be something that both sides could support and might address some of the division that's happening in the

country. >> guys, one more last point here on this whole debate. a friend of mine very smartly told me the other day that tax reform efforts have died a thousand times before being enacted. we are still at a very early stage, and this is going to go through several iterations with the white house plan and negotiations with congress. so we're going to go on a bit of a wild ride for the next year on how tax reform is actually going to play out. >> right. one thing we haven't mentioned, brian, is obamacare. and boehner's comments yesterday, goldman's comments today. how resolute will they be about doing that first? >> everything is subject to change, carl. i think they want to go ahead with obamacare first, and i think they feel political pressure to, but as time goes along and if they cannot accomplish what they want to on obamacare at some point maybe you make a political calculation to shift gears and focus and tax

reform moves up the priority list a little bit. i think we're in a very fluid situation. and strategies are going to change multiple times. >> mark, brian, great discussion. appreciate it, guys. thanks so much. >> thank you. have a great weekend. >> mark patterson, brian gardner. >> when we come back, we're keeping an eye on the c conservative political action conference in the potomac. we'll take you there live once the president begins speaking. "squawk on the street" will be back after this break.

we take you to national harbor, maryland, where the president of the united states about to address the conservative political action conference hosted by the american conservative union. conference has actually been around since 1974, but certainly not the first time the president has spoken. his first address in 2011, took last year off to campaign of course. but in complete command of the agenda at this conference today. here's the president. [ cheers and applause ] >> great to be back at cpac. it's a place i have really -- i love this place. love you people. so thank you. thank you very much.

first of all, i want to thank matt and his very, very incredible wife -- and boss, mercedes, who've been fantastic friends and supporters and so great when i watch them on television defending me. nobody has a chance. so i want to thank matt and mercedes. [ applause ] and when matt called and asked, i said absolutely i'll be there with you. i mean, the real reason i said it, i didn't want him to go against me because that one you can't beat. so i said absolutely. and it really is an honor to be here. i wouldn't miss a chance to talk to my friends. these are my friends. and we'll see you again next year and the year after that.

i'll be doing this -- i'll be doing this with cpac whenever i can and i'll make sure we're here a lot. you know, if you remember my first major speech -- sit down everybody. come on. you know, the dishonest media, they'll say he didn't get a standing ovation. you know why? no, you know why? because everybody stood and nobody sat. so they will say he never got a standing ovation. right? [ cheers and applause ] >> >> >> usa! usa! usa! usa!

>> you can sit down. so donald trump did not get a standing ovation. they leave out the part, they never sat down. they leave that out. so i just want to thank. but you know my first major speech was at cpac probably five or six years ago. first major political speech. and you were there. and it was -- i loved it. i love the people. i love the commotion. and then they did these polls where i went through the roof and i wasn't even running, right? but it gave me an idea. and i got a little bit concerned when i saw what was happening in the country. and i said let's go to it. so it was very exciting. i walk the stage on cpac, i'll never forget it really. i had very little notes and even less preparation. so when you have practically no notes and no preparation and then you leave and everybody was

thrilled, i said i think i like this business. i would have come last year but i was worried that i would be at that time too controversial. we wanted border security. we wanted very, very strong military. we wanted all of the things we're going to get and people consider that controversial, but you didn't consider it controversial. so i've been with cpac a long time. all of these years we've been together. and now you finally have a president. finally. took you a long time. took you a long time. and it's patriots like you that made it happen, believe me. believe me. you did it because you love your country. because you want a better future for your children. and because you want to make america great again.

[ cheers and applause ] the media didn't think we would win. the pundits -- you're right. they had an idea. the pundits didn't think we'd win. the consultants that suck up all that money, oh, they suck it up they're so good, they're not good at politics, but they're really good at sucking up people's money. especially my opponents because i kept them down to a minimum. but the consultants didn't think we would win. but they all underestimated the power of the people, you. and the people proved them totally wrong. never -- this is so true. and this is what's been happening. never underestimate the people.

never. i don't think it will ever happen again. and i want you all to know that we are fighting the fake news. it's fake, phony, fake. a few days ago i called the fake news the enemy of the people, and they are. they are the enemy of the people. because they have no sources. they just make them up when there are none. i saw one story recently where they said nine people have confirmed -- there are no nine people. i don't believe there was one or two people. nine people. and i said give me a break. because i know the people. i know who they talk to. there were no nine people. but they say nine people. and somebody reads it and they think, oh, nine people, they have nine sources. they make up sources. they're very dishonest people. in fact, in covering my comments

the dishonest media did not explain that i called the fake news the enemy of the people, the fake news. they dropped off the word fake. and all of a sudden the story became the media is the enemy. they take the word fake out. and now i'm saying, oh, no, this is no good. but that's the way they are. so i'm not against the media. i'm not against the press. i don't mind bad stories if i deserve them. and i tell you i love good stories, but we won't -- i don't get too many of them. but i am only against the fake news media or press. fake. fake. they have to leave that word. i'm against the people that make up stories and make up sources. they shouldn't be allowed to use

sources unless they use somebody's name. let their name be put out there. let their name be put out. a source says that donald trump is a horrible, horrible human being. let them say it to my face. let there be no more sources. and remember this and not in all cases. i mean, i had a story written yesterday about me in reuters by a very honorable man, it was a very fair story. there are some great reporters around. they're talented. they're honest as the day is long. they're great. but there are some terrible dishonest people and they do a tremendous disservice to our country and to our people, a tremendous disservice. they are very dishonest people. and they shouldn't use sources. they should put the name of the person you will see stories dry up like you've never seen

before. so you have no idea how bad it is because if you are not part of the story, and i put myself in your position sometimes because many of you are not part of the story and if you're not part of the story, then you sort of know if you are part of the story you know what they're saying is true or not. so when they make it up and they make up something else and you saw that before the election, polls, polls, the polls, they come out with these polls and everybody was so surprised. actually, a couple of polls got it right. i must say "los angeles times" did a great job. shocking because, you know -- they did a great job. and we had a couple of others that were right, but generally speaking, i mean, i can tell you the network, somebody said a poll came out. and i said what network is it? and they'll say -- let's not even mention names, right?

well, we have a lot of them. the clinton news network is one. totally. take a look, honestly. take a look at their polls over the last two years. now, you'd think they'd fire the pollster, right? after years and years of getting battered. but, i mean, who knows, maybe they're just bad at polling. or maybe they're not legit. but it's one or the other. look at how inaccurate -- look at cbs, abc, look at nbc, take a look at some of these polls. they're so bad, so inaccurate. and what that does is it creates a false narrative. it creates like this narrative that's just like we're not going to win and people say, oh, i love trump. but you know i'm not feeling great today. he can't win. so i won't go and vote. i won't go and vote. it creates a whole false deal.

and we have to fight it, folks. we have to fight it. they're very smart. they're very cunning. and they're very dishonest. so just to conclude, i mean, it's a very sensitive topic. and they get upset when we expose their false stories. they say that we can't criticize their dishonest coverage because of the first amendment. you know they always bring up the first amendment. and i love the first amendment. nobody loves it better than me. nobody. i mean, who uses it more than i do? but the first amendment gives all of us, it gives it to me, gives it to you, gives it to all americans the right to speak our minds freely. it gives you the right and me the right to criticize fake news and criticize it strongly.

and many of these groups are part of the large media corporations that have their own agenda. and it's not your agenda. and it's not the country's agenda. it's their own agenda. they have a professional obligation as members of the press to report honestly. but as you saw throughout the entire campaign and even now the fake news doesn't tell the truth. doesn't tell the truth. so just in finishing, i say it doesn't represent the people. it never will represent the people. and we're going to do something about it because we have to go out and we have to speak our minds. and we have to be honest. our victory was a win like nobody has ever seen before. and i'm here fighting for you. and i will continue to fight for

you. the victory and the win was something that really was dedicated to a country and people that believe in freedom, security and the rule of law. our victory was a victory and a win for conservative values. and our victory was a win for everyone who believes it's time to stand up for america, to stand up for the american worker and to stand up for the american flag. there we should stand up. come on. there we should stand up.

okay. and by the way, we love our flag. by the way, you folks are in here, the place is packed, there are lines that go back six blocks. and i tell you that because you won't read about it, okay. but there are lines that go back six blocks. there is such love in this country for everything we stand for. you saw that on election day. and you're going to see it more and more. so we're all part of this very historic movement, a movement the likes of which actually the world has never seen before. there's never been anything like this. there's been some movements, but there's never been anything like this. there's been some movements that petered out, like bernie. petered out. but it was a little rigged against him. you know, super delegate, super delegate. she had so many delegates before the thing even started. i actually said to my people,

how does that happen? not that i'm a fan of bernie, but a lot of bernie people voted for trump, you know why? because he's right on one issue, trade. he was right about trade. our country is being absolutely devastated with bad trade deals. so he was right about that. but we got a lot of bernie support. so actually i like bernie, okay? i like bernie. but i'm here today to tell you what this movement means for the future of the republican party and for the future of america. first, we need to define what this great, great unprecedented movement is and what it actually represents. the core conviction of our movement is we are a nation that put and will put its own citizens first.

[ cheers and applause ] >> usa! usa! >> for too long we've traded away our jobs to other countries. so terrible. we've defended other nations' borders while leaving ours wide open, anybody can come in. oh, we're going to build a wall. don't worry about it. we're building the wall. we're building the wall. in fact, it's going to start soon. way ahead of schedule. way ahead of schedule. way, way, way ahead of schedule. it's going to start very soon. general kelly by the way has done a fantastic job.

fantastic job he's done. and remember, we are getting the bad ones out. these are bad dudes. we're getting the bad ones out. okay. we're getting the bad -- if you watch these people, it's like, oh, gee, that's so sad. we're getting bad people out of this country. people that shouldn't be whether it's drugs or murder or other things, we're getting bad ones out. those are the ones that go first. and i said it from day one. basically all i've done is keep my promise. we've spent trillions of dollars overseas while allowing our own infrastructure to fall into total disrepair and decay. in the middle east we've spent as of four weeks ago $6

trillion. think of it. and by the way, the middle east is in -- i mean, it's not even close. it's in much worse shape than it was 15 years ago. if our presidents would have gone to the beach for 15 years, we would be in much better shape than we are right now. that i can tell you. be a hell of a lot better. we could have rebuilt our country three times with that money. this is the situation that i inherited. i inherited a mess, believe me. we also inherited a failed health care law that threatens our medical system with absolute and total catastrophe. now, i've been watching, and nobody says it, but obamacare doesn't work, folks. i mean, i could say, i could

talk, it doesn't work. and now people are starting to develop a little warm heart. but the people that you're watching, they're not you. they're largely many of them are the side that lost. you know, they lost the election. it's like how many elections do we have to have? they lost the election. but i always say obamacare doesn't work and these same people two years ago and a year ago were complaining about obamacare. and the bottom line, we're changing it. we're going to make it much better. we're going to make it less expensive. we're going to make it much better. obamacare covers very few people. and remember deduct from the number all of the people that had great health care that they loved that was taken away from them. it was taken away from them. millions of people were very

happy with the health care. they had their doctor, they had their plan. remember the lie 28 times? you can keep your doctor, you can keep your plan, over and over and over again you heard it. so we're going to repeal and replace obamacare. and i tell paul ryan and all of the folks that we're working with very hard, dr. tom price very talented guy, but i tell them from a purely political standpoint the single best thing we can do is nothing. let it implode completely. it's already imploding. you see the carriers are already leaving. it's a disaster. two years don't do anything.

the democrats will come to us and beg for help. they'll beg. and it's their problem. but it's not the right thing to do for the american people. it's not the right thing to do. we inherited a national debt that has doubled in eight years. think of it $20 trillion. it's doubled. and we inherited a foreign policy marked by one disaster after another. we don't win anymore. when was the last time we won? did we win a war? did we win anything? do we win anything? we're going to win. we're going to win big, folks. we're going to start winning again. believe me. >> >> >> usa! usa! usa! usa!

>> but we're taking a firm, bold and decisive measure, we have to, to turn things around. the era of empty talk is over. it's over. now is the time for action. so let me tell you about the actions that we're taking right now to deliver on our promise to the american people and on my promise to make america great again. we've taken swift and strong action to secure the southern border of the united states and to begin the construction of a great, great border wall. by doing this and with the help of our great border police, with the help of i.c.e., with the help of general kelly and all of

the people that are so passionate about this, our border patrol i'll tell you what they do -- they came and endorsed me. i.c.e. came and endorsed me. they never endorsed a presidential candidate before. they might not even be allowed to. but they were disgusted with what they saw. and we'll stop it. we'll stop the drugs from pouring into our nation and poisoning our youth. pouring in. pouring in. we get the drugs, they get the money. we get the problems, they get the cash. no good. no good. going to stop. by stopping the flow of illegal immigration we will save countless tax dollars. and that's so important because the tax -- the dollars that we're losing are beyond anything that you can imagine. and the tax dollars that can be used to rebuild struggling

american communities including our inner cities. we are also going to save countless american lives. as we speak today, immigration officers are finding the gang members, the drug dealers and the criminal aliens and throwing them the hell out of our country. and we will not let them back in. they're not coming back in, folks. they do, they're going to have bigger problems than they ever dreamt of. i'm also working with the department of justice to begin reducing violent crime. i mean, can you believe what's happening in chicago, as an example? two days ago seven people were

shot. and i believe killed. seven people. seven people. chicago, a great american city. seven people shot and killed. we will support the incredible men and women of law enforcement. [ applause ] thank you. and thank them. i've also followed through on my campaign promise and withdrawn america from the transpacific partnership. so that we can protect our economic freedom. and we're going to make trade

deals, but we're going to do one-on-one, one-on-one, and if they misbehave, we terminate the deal. and then they'll come back and we'll make a better deal. none of these big quagmire deals that are a disaster. just take a look by the way at nafta. one of the worst deals ever made by any country having to do with economic development. it's economic undevelopment as far as our country's concerned. we're preparing to repeal and replace the disaster known as obamacare. we're going to save americans from this crisis and give them the access to the quality health care they need and deserve. we've authorized the construction one day of the keystone and dakota access pipeline. and issued a new rule, this took place while i was getting ready to sign. i said who makes the pipes for

the pipeline? well, sir, comes from all over the world. isn't that wonderful? i said, nope, comes from the united states or we're not building it. american steel. if they want a pipeline in the united states, they're going to use pipe that's made in the united states. do we agree? but can you imagine, i told this story the other day, can you imagine the gentleman, never met him, don't even know the name of his company -- i actually sort of know it, but i want to get it exactly correct. big, big powerful company, they spent hundreds of millions of dollars on the pipeline. same thing with the dakota. they got approvals everything in the case of dakota and all of a sudden they couldn't connect it because they had people protesting that never showed up

before. so they spend hundreds of millions with blood sucker consultants sucking the blood out of the company. don't worry, i've used them all my life. don't worry, we're going to get it approved, i'm connected, bottom line, obama didn't sign it. could have been somewhere around 42,000 jobs, a lot of jobs, didn't sign it. can you imagine he gave up? a year ago it was dead. now he's doing nothing calling his wife, hello, darling, i'm a little bored, you though that pipeline -- that has killed our company. knock-knock, mr. so and so, the keystone pipeline, sir out of nowhere has just been approved. now, can you imagine the expression? and you know the sad part, the same blood sucking consultants that hit him for all the money and failed, they're now going to go back to him and say didn't we do a great job?

we want more money, right? because that's the way the system works, a little bit off. but that's the way the system works. we're preparing bold action to lift the restrictions on american energy including shale oil, oil, natural gas, and beautiful, clean coal, and we're going to put our miners back to work. miners are going back to work. miners are going back to work, folks. sorry to tell you that, but they're going back to work. we have begun a historic program to reduce the regulations that are crushing our economy. crushing. and not only our economy, crushing our jobs, because companies can't hire. we're going to put the

regulation industry out of work and out of business. and by the way, i want regulation. i want to protect our environment. i want regulations for safety. i want all of the regulations that we need, and i want them to be so strong and so tough, but we don't need 75% of the repetitive, horrible regulations that hurt companies, hurt jobs, make us noncompetitive overseas with other companies from other countries. that we don't need, but we're going to have regulation. it's going to be really strong and really good, and we're going to protect our environment and we're going to protect the safety of our people and our workers, okay? [ cheers and applause ] another major promise is tax reform. we are going to massively lower taxes on the middle class, reduce taxes on american

business, and make our tax code more simple and much more fair for everyone, including the people and the business. in anticipation of these and other changes, jobs are already starting to pour back into our country. you see that. in fact, i think i did more than any other prepresident. they say president-elect. president-elect is meeting with ford, he's meeting with chrysler, he's meeting with general motors! i just wanted to save a little time, because ford and fiat chrysler, general motors, sprint, intel, and so many

others are now, because of the election result, making major investments in the united states, expanding production, and hiring more workers, and they're going back to michigan and they're going back to ohio, and they're going back to pennsylvania, and they're going back to north carolina and to florida. it's time for all americans to get off of welfare and get back to work. you're going to love it! you're going to love it! you are going to love it. we're also putting in a massive budget request for our beloved military!

and we will be substantially upgrading all of our military, all of our military, offensive, defensive, everything, bigger and better and stronger than ever before. and hopefully, we'll never have to use it, but nobody's going to mess with us, folks, nobody. it will be one of the greatest military build-ups in american history. no one will dare question, as they have been, because we're very depleted, very, very depleted, sequester. sequester. nobody will dare question our military might again. we believe in peace through

strength, and that's what we will have. as part of my pledge to restore safety to the american people, i have also directed the defense community to develop a plan to totally obliterate isis. working with our allies, we will eradicate this evil from the face of the earth. at the same time, we fully understand that national security begins with border security. foreign terrorists will not be able to strike america if they cannot get into our country. and by the way, take a look at what's happening in europe, folks. take a look at what's happening

in europe. i took a lot of heat on sweden. and then a day later, i said, has anybody reported what's going on? and it turned out that they didn't. not too many of them did. take a look at what happened in sweden. i love sweden. great country, great people. i love sweden, but they understand i'm right. the people over there understand i'm right. take a look at what's happening in sweden. take a look at what's happening in germany. take a look at what's happened in france. take a look at nice and paris. i have a friend. he's a very, very substantial guy. he loves the city of lights. he loves paris. for years, every year during the summer, he would go to paris. it was automatic with his wife and his family. i hadn't seen him in a while. and i said, jim, let me ask you a question, how's paris doing?

paris? i don't go there anymore. paris is no longer paris. that was four years, four or five years, hasn't gone there. he wouldn't miss it for anything. now he doesn't even think in terms of going there. take a look at what's happening to our world, folks, and we have to be smart. we have to be smart. we can't let it happen to us. so, let me say this as clearly as i can. we are going to keep radical islamic terrorists the hell out of our country. we will not be deterred from this course. and in a matter of days, we will be taking brand-new action to

protect our people and keep america safe. you will see the action. i will never, ever apologize for protecting the safety and security of the american people. won't do it. if it means i get bad press, if it means people speak badly of me, it's okay. it doesn't bother me. the security of our people is number one, is number one. our administration is running with great efficiency, even though i still don't have my cabinet approved. nobody mentions that. do you know i still have people out there waiting to be approved? and everyone knows they're going to be approved. it's just a delay, delay, delay. it's really sad. it's really sad. and these are great people. these are some great people.

we still don't have our cabinet. i assume we're setting records for that. that's the only thing good about it is we're setting records. i love setting records. but i hate having a cabinet meeting and i see all these empty seats. i said, democrats, please, approve our cabinet and get smart on health care, too, if you don't mind. but we're taking meetings every day with top leaders in business, in science and industry. yesterday i had 29 of the biggest business leaders in the world in my office -- caterpillar, tractor, campbell's soup. everybody. we had everybody. i like campbell's soup. we had everybody and we came to a lot of very good conclusions and a lot of folks that are in that room are going to be building big, big, massive new

plants and lots of new jobs, and you know what, they're going to be building them in this country, not some other country. we're meeting with unions, meeting with law enforcement, and we're meeting with leaders from all around the world. where the white house doors used to be totally closed -- they were closed, folks. you don't realize that. they were closed. they're now wide open. and they're open for people doing business for our country and putting people to work. and when they come into the white house, we're translating these meetings into action. one by one, we're checking off the promises we made to the peeyt united stat people of the united states, one by one. a lot of promises. and we will not stop until the job is