welcome back to "squawk on the street." stocks off to a strong start after upbeat earnings report. materials and financial stocks leading the rally so far on materials front we have freeport, dupont, dow chemical, cf industries outperformers ones to watch today. let's send it back downtown for start of "squawk alley." back over to you guys. >> good morning. it's 11:00 a.m. at coke headquarters in atlanta. 11:00 a.m. on wall street and "squawk alley" is live. ♪

good tuesday morning. welcome to "squawk alley." post nine. obviously a major rally on our hands again this morning. the nasdaq hitting 6,000 for the first time ever. you have facebook, google, netflix, microsoft, a number of other names hitting all-time highs. the broader averages seeing big back-to-back days of gains. joining us to break it all down is our senior market editor. first back-to-back 200-point gains since election, november 8 and 9. >> the dow outperforming a little bit today thanks to caterpillar, but i do think it's interesting. yesterday's move i thought was a little bit too highly calibrated. it was a quick 1%. it just sat there all day. didn't feel as if people were confident enough to say this was the start of a run back to the old highs. today is different. it's more based on corporate fundamentals based on the fact that the market didn't just make it a one-day wonder and we'll look for followthrough.

s&p 500 up half percent within a few points of its high. >> we wonder what the washington impact is and trump policies with word that he still wants 15% corporate tax rate. interesting dp interestingly, russell 2000 is trading at a record high. >> the way psychology has worked is way too aggressive in expectations at the start of the year. really cooled down in the last few weeks to the point where people said we don't think anything is going to happen here, and now i think it's in the back of people's minds that maybe nothing happens but if something happens it's going to be good or gravy based on what else is going on in the economy, so i think that's kind of where we are. the russell i think is also the more cyclical index. it's the more value orientated index. more financials in there. it's part of this perhaps beginning of a re-rotation out of the big growth stocks that have been driving the nasdaq up to 6,000 and back toward

cyclicals coming into the year. >> do you take anything away from the market's reaction to the french election and how that might influence how u.s. policy movements, action or inaction, out of congress might move the market from here on out. >> the market reaction to the french election is relief that it's out of the way without a surprise. i'll be honest with you. i don't think it's about extending that thread into saying it's going to mean certain things for policy or not. if you look back to brexit to our election, it seems as if the market was waiting and was kind of held in check until tl was out of the way to do something it might have been gearing up to do anyway. that's what we might be seeing with u.s. stocks. >> others are painting out year on year buybacks. are things too expensive? >> it seems like the game has changed a little bit. corporate america is levered up right now. they have done that. i'm not saying they're going to stop, but i do think that the

story has changed from low rates for longer, financial engineering, we're just going to try to assume there's no growth and buy back our stock to maybe something different. i think that you would say if the market is up here without people pointing to buybacks as being a swing factor, that's probably okay. i thought buy backs were overplayed. >> you have trade tensions and new tariffs on canada. larry kudlow used word surgical and mechanical. it feels like that's how the market is viewing it. not afraid of a bigger growth inhibiting trade spat with one of our closest trading partners? >> i don't think the market will overanticipate that this really does build in something that's more worrisome. it seems like it's gestures sending a signal that we'll be onguard in individual markets. not markets that are tremendously important to our economy. it's not as if it's jeopardizing

huge trade flows. if somebody thought that our exports of software were somehow going to be impinged by some of these actions, i think the market -- >> i wonder if they're important to the middle class. you already have a housing shortage and builders saying cost is a big piece of that, it might only be 2% of the cost of a home that lumber piece but if that goes up significantly and keeps builders who would otherwise be thinking about coming into the market from doing it, that can have long-term emp kaimplications. >> it doesn't help. one thing about housing is that new homes are relatively small part of the housing market as we describe it. yeah, i think around the edges it doesn't help. i don't think it's the thing that's going to distract people from other stuff happening. >> 10% of housing is new on those figure. thanks. sticking with the morning's rally in tech, let's get to the heart of the action. bertha coombs is at the nasdaq m. >> over 200 new highs today on the sector.

small caps are the best performers with the russell inching to a new all-time high. biotech strong today after better than expected earnings. but this has been a large cap fuelled move to 6,000 for the nasdaq. nasdaq 100 gained more than twice the over all-market up nearly 14% year-to-date. best year right now since 2014. more than two dozen new highs on nasdaq 100 alone today. a lot of them big cap tech which has been driving the run-up this year. tech heavy weights like microsoft and paypal leading the nasdaq to 5,000 the first time around in 2000. also usual suspects these alpha. they have underperformed in terms of gains year-to-date. it hasn't been a big driver. it's contributed to the nasdaq

100's gain so far this year. if you look at it in terms of the real impact on this market weighted index, it's about apple and claims a lot of market share, about 25% of the gains. another 25% coming from amazon and facebook. microsoft has started to be a contributor in the last month or so. one thing to watch is that apple after coming on strong in the first quarter stalled here in april even as it notched new historic highs. that's something to watch in terms of momentum. >> thank you very much for that. ber bertha, thank you. new tariffs on canadian lumber. president directing aides to draft a plan cutting the corporate tax rate to 15% and three days left to avert a government shutdown and make a budget deal. white house signaling it may be willing to wait on immediate funding for that border wall. joining us to talk about all that, aspen institute walter

isaacson. good to see you. >> good to see you again, carl. >> let's tackle the lumber issue. top of the fold on the journal this morning. we just talked to mike about whether or not the white house can do this in a surgical fashion without having it balloon into an overwhelming narrative on trade. can it? >> yes, i think so. one of the things we've seen about president trump is he talks really big. make mexico pay for the wall. having the trade and tariffs but he acts much more surgically. this is a very surgical thing. this is on, you know, blumber ad dairy products. it's been going on for ten years. there's always been disputes on this. i think it's a surgical thing. i think jon was right to point out there's always two sides to this. if you are adding room to your home or you're trying to build a new home, you kind of like the fact that the canadians are sending subsidized lumber into

the market. that's a type of enforcement activity we should be doing. i don't think this is that big of a deal. >> do you think there should be any takeaways or implications for technology companies? clearly the market doesn't think so. originally right after the election, remember, those big cap tech stocks sold off. some of the fear was that if president trump pursued a more aggressive confrontation trade strategy, they are right in the crosshairs from the supply side to the demand side. >> absolutely. i think that if he pursued a really full out anti-trade policy, you would have real problems in tech. i think what we're seeing now is almost a careful calibration of how we're going to use trade policy, which i think is a little bit why it's calming down people in the tech market. >> walter, how far are we, do you think, from being able to get more of a theory of trump in how he's behaving on things like trade?

i mean, plenty of anti-nafta rhetoric in this action against canadian blumber. it seems to be somewhat surgical. do you have a good picture by now? >> i don't think we all have a great picture because he's more unpredictable than some previous people we've had in the oval office. however, one of the things that's been consistent about trump whether you read the art of the deal or talk to anybody who has dealt with him for 30, 35 years, is that his rhetoric way outpaces his action. he often likes to throw things out in a very strong way and say let's just declare it and say it so even if it's not so but once it's declared and rhetoric happened and once we said we'll have trade wars and mexico is building walls and going to pay for it and all that, then he sort of settles to the art of the possible. >> walter, on taxes, we do know that they'll meet with

congressional leaders tonight. we'll see what the announcement looks like tomorrow. how seriously should the market take what sounds like a bit of a soft wish list? we'll see what we get. >> once again, i think this is sort of the rhetorical wish list. we want to go down to 15%. it's a real test for the republican party. you said that they're meeting with congressional leaders. i'm meeting with republican leadership because republicans have to figure out how serious are we about deficits and how we figure out the border adjustment tax. when it comes to the tax rate, people talked about the republican plan you know better than i from a years ago was bring it down to 25%. others said with border adjustment tax you can do 20%. i think lobbying out 15% is more of a rhetorical thing than a highly honed plan. i kind of feel that there are a lot of republicans there that will say even with dynamic

scoring, let's look at the facts. we can't balloon the deficit that badly and the final thing i would say is you could do this with a little bit of democratic support in the senate if you don't -- if you're willing to try to do that, and then you would have tepermanent tax cuts rather than through the reconciliation process which doesn't make the tax cuts permanent and to me is not as good for the u.s. economy. >> we're definitely going to pay attention to legislative filibuster and whether that remains after the gorsuch episode. walter, it will be a heck of a week. it already is. we'll talk to you soon. thanks. >> thanks for having me on. >> when we come back, cnbc exclusive with incoming ceo of coke, james quincey. dow up 232.

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coca-cola shares are lagging the broader market firmly in rally mode right now. the company meeting expectations on q1 earnings and announcing more cost cuts to the tune of $800 million include cutting 20% of its corporate staff. we welcome james quincey incoming ceo of coca-cola who will officially have the job six days from now. welcome. >> thank you. good morning. >> good morning. so it seems like the biggest news out of today is that $800 million in added productivity savings.

talk about the job cuts, if you can, where they're coming from, how this will affect the overall company? >> sure. i mean, we're doing these changes in the corporate center basically more agile and focused on growth. we would have gone from high of 150,000 employees and transferred a lot of those operating employees to our borrowing partners and be under 40,000 thenext year. so between that change in the size of the enterprise and what's happening in technology and sharper focus on what do we need to do to drive growth into the future, we've made some choices around where we need to deploy resources, and, yes, it's painful. we're going to impact some people here in the corporate center, but we think this new more slimmer, leaner focus corporate center reflects the new reality of the company and sets us better up for growth going forward. >> so where do those productivity savings get

invested in? >> right, we've made some reinvestments from our previous productivity problems. the majority were redirected as reinvigorating multiple years of revenue growth. this new program we're going to take about half of the savings and reinvest them probably more behind the newer categories where we see faster growth and where we want to develop some leadership positions more substantially in certain j geography. those are examples of where we'll invest some of these savings, yeah. >> on the quarter overall, a noisy one. going through bottler refranchising. easter shift. what can you say abond when wil

investors get a clean read? >> the revenue number is very noisy. i think the simplest way to read through that is to look at the underlying sales and price mix we're achieving. solid 3% when you look at it that way for the quarter in line for full-year guidance. we want to accelerate that and get cleaner into 18 and 19. this year given all other refranchising we have yet to complete in 2017, actually second quarter will reflect the completion of our chinese bottling transaction on the 1st of april. it will get cleaner into '18 and '19 and you'll see robust growth come through for new smaller company. >> another headwind is currency impact and tough macro economy. the story in markets and data has shown improvement globally.

can you talk about where you're seeing that and which parts of the world still remain tough? >> yeah. i mean, absolutely. first, currency is less of a headwind this year than it has been for the last few years. still a bit of a headwind but better than previous years. what we see around the world developed markets continue to be strong, europe, u.s., japan, some emerging markets are getting better than last year. china in particular. india now coming in recent -- not so much january and february but coming into march and april the change in currency is moving through the system. have to be said there are some places still that are pretty volatile in particular for us brazil and venezuela. so a slight better trend especially in the emerging markets, but we're not out of the woods yet. >> what about the u.s.? what are you seeing here? we saw a spike in consumer confidence after the election. any change in consumer behavior at the convenience stores or groceries since then?

>> i think the biggest impact for us honestly in the first quarter was shift of easter last year easter was in the first quarter. this year it's largely in the second quarter. so that's the biggest thing that's going on as we sit. we're very happy with what we've achieved. we have multiple years now of strong revenue and profit growth in the u.s. making good gains in terms of the marketplace. so we're very positive on the u.s. business. we're very positive on the strategy we put in place. we see a continued opportunity for good run and another good year in the u.s. business. we're positive. >> let's pick up a little bit on that strategy as i mentioned. you take over this company next monday. you're taking over coca-cola at a time where volumes are still flat. soda consumption in the u.s. fell for the 12th year in a row and in diet category it's worse. where do you take this company

into the future? >> if we look at the global story, in the u.s. we're focused on more transactions and more revenue. while volumes are still off, revenue, the growth of the top line continues to be strong and positive. so that's in positive revenue growth this quarter and has been for the last few years. we have a clear strategy in the u.s. to grow revenue through transactions and to broaden the portfolio. that's true globally. we're looking to continue to grow sparkling and other categories so we see robust growth globally in the sparkling revenue and all of the other categories we participate in including the diet drinks. diet drinks are adding more volume and more revenue than the sugar drinks in sparkling category. look around the world and particularly the latest improvement of one of our formulas, coca-cola zero sugar

resonated well in lead markets. growth of coke zero went from low single digits a few years ago to mid single digits to 9% last year and this quarter it's in double digit growth. we see some acceleration around the world for coke zero sugar. >> i'm a little surprised to hear about the diets. the recent study published last week from an american heart association journal found a daily diet soda puts you at three times the risks of dementia and stroke compared to someone who drinks less than one diet a week. your reaction to that study? >> yeah, look, i think, you know, the study itself was pretty clear at the end that they weren't saying that there was a cause and effect here that it was kind of some kind ofstat iici iccal link and they are

safe for consumption. we're in favor of more research across food and beverage. we should feel good and identify problems, but we respond to the regulatory agencies and they're telling us that they're safe to use and consumers are enjoying them as part of a broader balanced diet. >> it does feel like a little bit of a pile on right now when it comes to the studies. it's not just diets. it's sugary drinks in general. soda taxes popping up around this country and globally. do you approach this as a marketing problem? spend more lobbying dollars? what's the plan to combat all this? >> the way i see it is we are going to provide the consumers what they want and need. you know, there will be a role for each and every product. i think the problem because in anything in life including food and beverages when it's too much of something. so we believe there's a role for products with sugar. we think there's a role for

products with artificial sweeteners and products with some and less of both and unsweetened products too. that's part of what we're focused on and i'm focussed on going forward is completing the play to be a total beverage company. as we expand out, we will be able to through that broadening continue to grow the corporation because in the end, people will be able to have the right amount for them and a broad portfolio. in the end, you know, there are lots of industries that disintermedia disintermediated but every person will have eight eight ounce drinks a day and virtually every single person around the world will have a variety of drinks. no one will make all eight the same if they have disposable income so our objective is to

focus on those consumer needs and provide them a portfolio of beverages that they can enjoy through the day. >> hopefully we'll talk more about that at a later date. james, i want to quickly ask you because the administration did impose tariffs on the lumber industry in canada. it's a small niche market. if we see more tariffs from the administration, is that a big threat to your business which operates in more than 200 countries around the world? >> for our business, it's not a big threat. while we do support open trade and tax reform, actually one of the great strengths of the coke system is we are local everywhere. virtually anything that every consumer drinks will be made in the country that drinking it is. we don't ship our product around the world. we have lots of plants and factories and warehouses and create lots of white collar and blue collar jobs in the u.s. and every country we operate in around the world.

that's been one of the great strengths of the system for coca-cola and it's helped us prosper, so we are to some extent insulated from that effect. >> a giant local company. james, thank you for weighing in on earnings and much more. congratulations on taking the ceo position next week. incoming ceo of coca-cola. >> when we come back, details on yaho yahoo! ceo's marissa mayer's golden parachute and plan for the company now and tracking this morning's rally. much more coming up on "squawk alley." what if we could bring you better value

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>> yahoo! shareholders will vote on june 8th. a stock package would be worth

on $186 million. that number doesn't include her salary, bonuses and stock. she's already sold in the past five years. perhaps this was just preordain from when the yahoo! board decided that they had won the lottery and got a google executive who was highly compensated there because it's google. very different from the packages that we have seen from some previous yahoo! ceos who ended up out the door in less than ideal circumstances. $186 million if that's the number is a lot of money. >> she was an early google employee and at the time that was a huge coup to get mayer having been through resolving door of ceos some leaving on not the best terms. the question at the time was whether or not she was going to be a media person or a product person. that chapter still has to be written perhaps. >> perhaps the answer is neither when it comes down to what yahoo! has become. >> i just wonder what her legacy

is going to be? a series of corporate missteps when it comes to yahoo! or potentially creating a lot of shareholder value when it came to selling the company? >> i don't think she gets credit for creating shareholder value. it was sort of there. perhaps buried treasure. it's not a great legacy. we'll see how they very she rei herself from here. >> let's get a news update from sue herrera at hq. >> good morning, everyone. here's what's happening at this hour. president trump observing holocaust remembrance day with members of congress. the president will deliver a speech at the united states holocaust memorial museum unveiling a new conservation and research center home to a vast collection of artifacts donated by those that survived world war ii. benjamin netanyahu canceling talks with germany's visiting foreign minister. the decision stemming from germany's decision to meet with

left wing groups critical of israel's treatment of palestinians under occupation. arkansas executing two more death row inmates for a total now of three in the past few days. this after the state went nearly 12 years without executing an inmate. williams and jones both convicted murderers received lethal injections. protesters trying to stop arkansas from executing a fourth man scheduled for this thursday. the state has been stepping up executions because its lethal injection drug is expiring. and nascar's most popular driver announcing his retirement. 43-year-old dale earnhardt jr. says this will be his last season. the two-time daytona 500 winner has suffered several concussions. he's competed in more than 600 races and is a third generation race car driver. the sport will miss him. that's the news update this hour. "squawk alley" is back after a quick break.

two-day rally in the states. the question is whether that changes. >> hi. the relief rally in europe continues sparked by first-round results in the first presidential election. earnings back in the spotlight. let's talk about luxury. shares surging after the family of billionaire businessman and ceo offered to buy 26% stake.

lvmh says investors urged companies to simplify its corporate structure. the entire brand will be owned by lvmh. the family also plans to offer cash and shares. take a look at hermes falling. and austrian chip maker posting better than expected first quarter revenue and sweden's volvo was helped by demand for trucks and rebound in construction equipment business. lastly, swiss drug maker reporting better than expected first quarter profit and expressing confidence that the company will return to growth next year. those stocks all in the positive territory. lastly, currency traders keeping a close eye on the euro with a monetary meeting now on

thursday. some people saying that reduced political risk could mean that the central bank will start talking about tapering. euro holding onto 109 against the u.s. dollar. back to you. >> all right. thank you. the nasdaq crossing the 6,000 mark for the first time trading at intraday record. for more on the rally and big tech, let's bring in richard peterson and a partner with lead edge capital. welcome to both of you. i want to start, fred wilson yesterday wrote that the era of the hire feels like has come and gone. with all of these stocks so high and talent still in short supply, is that true and if so, why would that be? >> i don't necessarily agree that the era has come and gone. companies, there's been a lot of

companies funded by private market investors like myself. businesses overfunded and overcapitalized businesses that aren't sustainable stand alone so they are an easy way for large companies like apple, google, facebook to acquire talent and get engineering dna which is hard to come by and retain those people as part of the acquisition. how do you go about creating a retention package. you keep those people onboard and have them for a long time and they can be contributors for the platform business. >> how important do you think that sort perform acquisition is for these bigger companies that got the nasdaq to this point to keep growing? >> we talked about the ipo market that would be a busy week this week. we look back when cisco bought a company poised to go public now being captured by not only big tech but even big retailers if you look at walmart and recent acquisitions. >> journal took a crack this week at looking at the dry

powder that's piling up. are they running out of ideas or what do you think as we go through this period where they have all these funds not committed at least for now? >> there's a lot of capital sitting on the sidelines and all of us are looking for great ideas and places to put our money. on the other side, ipo road show road map ahead we're excited about 2017 and the fact that ipos will be a pressure valve release for venture capitalist so there will be money going back into the pockets of lps and that will create a little bit of lead time for investors like us to not have to put capital to work right away. if we're giving money back to lps, i think we have more time to put those dollars to work. so we're looking for ideas. there are fewer to come by. a lot of capital on the sidelines for sure. >> what have we learned about the ipos? the market is finally thawing. we've seen a number of them this year. how has demand been beyond just

a first day pop? >> average first day gain has been about 20%. the average gain is about 18%. there's entrenchment overall. technology is the leader in terms of sectors. used to be health care for the past several years. we're seeing that rotation. i think as we go forward looking for new opportunities with valuations where they are at elevated levels, funds and private investors looking for opportunities. those opportunities may be found in the ipo marketplace. >> how much has the pendulum swung in investment and startups toward enterprise versus consumer? i felt like that app yo was kind of the top in consumer. we recently saw the sell out. what do you say? >> the platform internet businesses are sucking up a lot of oxygen out of the room. facebook, google, the big

internet companies, they are making it really hard for smaller internet businesses to be able to build distribution. on the exercise side, there's less network effects. less of a marketplace dynamic when you build enterprise business. all of us can co-exist. i can go and get build a business and stand alone and be a stand alone business for a long time. we see more invested on the enterprise side because they are making it hard to compete and build audiences. you see it with snapchat today. instagram stories has taken off like a rocket ship. it leaves question marks on whether snapchat will reaccelerate growth and that's a business as big as snapchat. internet is tougher. i think that's why dollars are moving into the enterprise side. >> we're certainly going to be watching snap earnings along with the rest of them. thanks for joining us. >> thank you. >> when we come back, former u.s. trade rep and lead nafta negotiator will weigh in on this morning's trade announcement from the white house targeting

canada. dow not far from session highs up 226. rick, what are you watching? >> you know, i look at the board. i see 10s at 2.30. 30s at 2.95. could consumer confidence and good home sales and stock market jumping. what's going on? we'll talk about that after the break.

today on halftime report, market surges and nasdaq crossing a milestone. not everything is up. gold miners getting whacked. we'll look for opportunities and a rare downgrade for amazon. we have the analysts behind that bold call and while the run may be over. halftime report at the top of the hour. now back to you. >> thank you very much. let's get to the cme group. hey, rick. >> you know, it's been an exciting market but mostly exciting in stocks and a lot of that, of course, the catalyst of the european stock markets but certainly dragging ours. just consider this. stock market on friday closed right around 20,550 . that's about 2% move since friday's close. those are closing levels. what have treasuries done? six basis points.

six basis points from friday's close to where we are now. let's take it a step farther. look at intraday of 10s. not bad action. it's basically sideways. i don't mean that it's not a brisk trade. basically 2.30 has been on the board for quite a while. you look at new home sales. these are pretty good numbers. i'm sorry. the market seems to be in slow mode. look at 24-hour chart. we rose about six basis points before the sun came into the u.s. for our markets. if you pair it up on the 24-hour, maybe it makes a bit more sense. once again, we are paired with some of the rate rises that we see in europe and the boons it's first day for southern paper like italy and spain.

why? because it was based on a spread, a credit spread. the spread is widening out once again a little bit. the other issue we want to make sure we talk about here is that ultimately there's a range. let's look at the year-to-date chart of 10s. 230 to 260 was the range. we did seven sessions. eight sessions where we dabbled under it and here we are knocking on the door again. all things being equal, i think treasuries are in a comfortable mode here if they get back into the range my guess is we've done two things with that little voyage that we made under the 2.30 area. we most likely really cemented with super glue 2.63 high from earlier in 2017 doesn't mean rates can't go back up but all practical purposes we're probably starting to make a wedge and it probably has a pretty long time horizon. sarah, back to you. >> rick, thank you. you mentioned the excitement in the stock market. we are watching this broad rally. here's some big names that you recognize hitting all-time

highs. home depot, mcdonald's, adobe, be a f alphabet and microsoft. we'll be right back. finding time to get things done isn't easy.

but we've got the digital tools to help. now with xfinity's my account, you can figure things out easily, so you won't even have to call us. change your wifi password to something you can actually remember, instantly. add that premium channel, and watch the show everyone's talking about, tonight. and the bill you need to pay? do it in seconds. because we should fit into your life, not the other way around. go to xfinity.com/myaccount trump administration announcing a new tariff. what does it mean? we are joined by koaa cara la h.

do you see this as justified? >> we'll see. they've annoyanced a preliminary determination. they're entitled to do that. they're alleging these canadian companies were improperly subsidized. i believe this is the way one proceeded, that's why you want rules of law. that's why we want the north american free trade agreement and the world trade organization because it establishes rules, so where there's a dispute, revolve it. >> we've heard from prime m minister just uen trudeau speak ng a tech event saying he will defend the soft wood event in canada. what do you expect them to do to respond? >> they will have to show they have not been paid the subsidies that are alleged. what the commerce department has done is to determine

preliminarily. then they will do an investigation. when their work is finish ed, i will be b turned over to the international trade commission, which is impartial, federal agency. totally independent. which will determine whether the department of commerce had properly found subsidies in these companies that they have red circles and you know, it makes a lot of sense. to make it simple, you and i own houses next door and we were quarrelling over whether i was putting my fence on my property or yours, far better that instead of going out and punching each other, we find a try bruin yal or where the line really is so we can find a friendly way to revolve the dispute. and that's why these rules matter. i'm pleased that tsecretary ros

going through the rules we have establish and which are recognize d by the north americn free trade agreement. >> not sure i'd want to get in a fistfight with you or ross. on the mexico side, yesterday, citi ups its gdp estimate for mexico, in part of the trade rep's nafta draft arguing that the core chapter, chapter three of nafta, would not be reopened. are we looking at even as we're paying attention to the candidate's side, has the trade environment getting less antagonist nick on the mexico side? >> i hope so. canada is our largest trading partner and our largest export destination. mexico is our second largest export destination. we sell more to mexico than to all the rest of latin america. do we really want hostility at our border? do we want to lose the second

largest export destination? 6 million jobs hinge to our export and trade with mexico. i just can't imagine with the turmoil that is going in every continent of the world, that we have our north america peaceful prosperous and friendly. that we don't want to keep that and build upon it. >> ambassador, maybe give a sense of what the long game here might be. by my account, this dispute over a canadian lumber has been brewing in one form of another for 35 years, since 1982. this would be phase five of it. is this perhaps setting the stage for the nafta renegotiation, trump administration has talkeded so much about since lumber is so important to the canadian economy? >> well, it is an important issue to the canadians. but you point out that this has gone back. indeed, it was alive when i was

there. what we did was sit down and try to negotiate a settlement. but sometimes, you know, when you get different leadership and we've had over that 35 years, different presidents. different prime ministers, you have different emphasis on how they will interpret the agreements and what this administration has determined is that four or five companies have gotten unlawful subsidies from the canadian government and i think it's appropriate. that they resolve it by using our counterveiling duty, publishing, then they will make a final determination around september and then it can go to the international trade commission, so, if we get a resolution, so that at the end of the day, both sides of the border are saying yes, it was when they disagree, but it was fairly determined.

that the outcome, i think that's the way we should go. where ever we have a trade dispute. when we have rule, it makes it much, much better. to have a mechanism for revolving that dispute rather than having retaliation and a tit for tat elevation of hostility. >> we will see if that goes in this direction. out of time. thank you for joining us. value bable commentary on today's news, ambassador carla hill, former trade rep under president george p.w. bush. >> dow's up just like yesterday. back after this.

two day rally here, the best two days of the year so far for stocks and another day where we gap u up and hang in there. another tight range. around 21k. netflix is the biggest percentage gainer, up about 5.5%. raises some debt in europe earlier in the week. today, a partnership in china, licensing partnership, opening the door to a whole new world that doesn't happen yet. >> interesting deal. ing licensing their original content.

>> the industry that opposed trump the most has performed ed the best in the first 100 day. . that would be technology. remember their walk of shame? >> whatever the market decides, find a way to conform. over to melissa and the half. >> welcome to the halftime report. record breaker for the nasdaq surging past 6,000. the dow and s&p 500 and russell seeing big gains. our trader lineup -- what what do we pmake of the rally? >> i continue with the buy in.