live from new york where business never sleeps, this is "squawk box." >> good morning. welcome to "squawk box" right here on cnbc. we're live at the nasdaq market site in times square. i'm not gloating. >> yesterday, now you're not. >> joe kernen is here, melissa lee is here. becky quick is not here. we'll see her tomorrow ahead of the berkshire health away athaw. the futures, dow looks like it would open higher by 46 points. nasdaq 8 points higher. the s&p about 6 points high. overnight in asia, the nikkei was closed for holiday. the shanghai was flat. there was the debate in france, you're looking at just about everything on the way up in the green there.

finally a quick look at crude. you can buy a barrel of wti crude for $47.49. >> here are the big stories we're watching. a phishing attack has targeted google's 1 billion g-mail users. an e-mail coming from a trusted source asks you to open a google document and it redirects you to a page to open a google goc pdo page, which then trooef retrie e-mail addresses. tim cook saying apple will start a $1 million fund to promote manufacturing jobs in the united states. >> we're creating an advanced manufacturing fund. we're initially putting $1

billion fund in the fund. >> this i did not know about. >> we're announcing it today, you're the first person i'm telling. and i'm -- not the first person, because we have talked to a company that we're going to invest in, already. but this a billion dollars of apple's 256 billion. >> a billion dollars of our u.s. money, that we have to borrow to get, that's a whole other topic, but we're really proud to do it. and by doing that, we can be the ripple in the pond, because if we can create many manufacturing jobs around, those manufacturing jobs create more jobs around them because you have a service industry that builds up around them. and we'll be announcing the first investment from this fund later in the month of may. >> cook said the company should have values and should give back. one of the ways to do that is job creation. shares of apple up more than 25% year to date. on the economic agenda --

>> me and andrew are together on this. aren't we a little cynical on the apple thing? >> i want manufacturing in america. this is a good first step. i would argue it's a small step in a 2$256 billion pond. >> 256 billion. i would argue apple has the right to do what it's done in ireland and tax avoidance within the law. >> of course. >> but this, to me, kind of does not offset that -- i'm not saying that's the only reason -- >> offset meaning what -- >> offset the negative pr that comes from that. a billion dollars seems like -- he said a ripple in a pond. i'd call it a tiny drop in the pond. >> i think means there's more jobs to supplier the, more jobs to the app community. >> but also 256 over there. he says that's over there. we have to borrow -- you think it's hard for them to get a billion? you think the interest they pay on a billion over here --

>> they sneeze and they generate a billion dollars. >> and you have the iphone thing. they could use a little -- >> this is a billion dollars of goodwill. goodwill for some in d.c. >> i feel like i'm seeing what you're thinking, because you won't say it again. i want you to be as cynical as i know you are because of -- because of commercial -- >> i feel rumors of cynicism. >> during commercial breaks. be you. but not so much. >> not too much. >> 8:30 a.m. eastern time we get a trio of reports, initial jobless claims, international trade and productivity. kraft heinz coming up short of wall street estimates. the food company hurt by weak demand in the united states and canada. shares premarket down about

1.25%. tesla posting a wider than expected loss. still the company managing to more than double revenue from a year ago. record deliveries boosted sales. shares down about 1.5%. we'll talk to an analyst in a few minutes. we'll ask him. but do you believe this mass market car is -- >> mass market enough? >> is production really on track? >> they say that. >> the bears say that it will be difficult. >> i think the 5,000 is reasonable this year. the idea that it's going to double in a year from now -- >> the 5,000 is inclusive of the model 3. to believe there's an on-time ramp you believe the 5,000 by the end of the year. if you don't believe in an on-time launch, you can't believe that. >> can you get to 10,000 -- >> in 2018. if they had a second back seat vehicle. >> a third. i need three rolls. >> maybe the crossover, the

model y. >> you're counting the front. i'm saying a second backseat. >> you need three rows of seats. >> the one with the -- >> the ll. >> they already have one. >> does that have a second back seat? >> it has a third. >> so you're in the money. >> i'm not in the money because -- >> it's expensive. >> how much do they cost? >> 120,000. 120,000. >> do they? >> once you get the fancy things you want. >> for weekend driving? >> you have to do it in style. >> that or the toyota sienna. >> you're buying this to get out of the sienna? aren't you buying this to get out of the city? >> yeah. >> it's not just driving around here. you might need more than the -- do you have a summer house somewhere? >> i need to drive out and about. >> connecticut, right? >> sometimes connecticut. sometimes in other places. >> pennsylvania, tri-state area. >> tri-state. >> all right. good. good to get your kids out of here. let them see some trees.

breathe some real air. >> aig news, is that yours or mine? >> oh, it's me! okay. aig ticking higher helped by investment returns and cost cuts. the insurer announcing a 2$2.5 billion stock buyback. the shares are higher on the news. up about 1.4%. kevin mccarthy calling for a vote on the gop healthcare bill scheduled for this morning. mccarthy said republicans have the votes to pass the bill. eamon javers joins us from washington with more. >> good morning. republicans as you point out are saying they do have the votes today for this other obama care showdown. we expect around lunch time a vote for final passage. do they actually have the votes? that is the big question. they passed three amendments through the rules committee yesterday designed to wrap up the last moderate votes here that they think they need to get this over the threshold this

afternoon. here are the three amendments that passed yesterday. the changes to the bill that they think will get them the votes they need. an upton amendment provides billion over 5 years to help those with pre-existing conditions. the initial version of this bill removed obama care's protections for pre-existing conditions if the states granted a waiver and moved people into a high-risk pool. there's concern that wouldn't protect people with pre-existing conditions enough so now they'll put $8 billion towards addressing that. there's the macarthur amendment that allows states to waive the essential benefits clause. and the mcksally amendment removes language allowing congress members to be exempt from the ahca. the question is will this get passed today before they leave for recess?

and then what happens in the senate. it is not clear this slerversio this bill can pass in the senate. so they may have to deal with compromised bills from the senate. then they have to hash out the differences between the senate and the house, put together some final bill. where that all lands is anybody's guess politically. they made the tweaks they think they need to get this bill passed today. if they do, that's a win for the trump administration, which is still smarting from its earlier failure to get the healthcare bill to a vote in the house of representatives. they could at least do that today. they think they're on the verge of a win this afternoon. >> that upton stuff, because the day before when you had two sort of middle of the road guys that supported the last one. when they came back, that started it. >> i know you questioned tying the stock market to things in washington, but it's been a

weird correlation with things like this would you say how can healthcare repeal affect the stock market. but it has seemed to be correlated. the reason is that it makes tax reform easier and could be bigger. you see it again this morning. some of the positive sentiment. and i think just, you know, if you get a rwin, maybe tax refor, where that would be the first win rather than this. i think it affecting things. >> i agree with that. analysts on wall street look at this and sayf they can get healthcare done thatlears the decks politically, they can move on to tax reform and suggests that the trump administration knows what it's doing in terms of passing legislation. that gives you a sense that maybe they'll have some more wins when it comes to the tax reform bill that they're planning later on this year. both of those things give momentum and are heartening people on wall street today. we'll see. it's going to be a showdown. they're very close to the number that they need. >> 216, right? >> yeah. >> they can afford to lose 22.

they're something like 16, 17, 18 no votes now. so they're really on the margins. so we'll have to watch this closely. >> eamon two quick questions what are the implications of voting on a pill that's not bbi scored by the cbo. >> republicans said they wanted to go back to what's called regular order, all the traditional due process. one of those things is you get a score from the congressional budget office which tells you how much this bill costs, who is helped by it, who is hurt by it. it's an nalltianalysis done by nonpartisan organization up on capitol hill that helps people understand what they're voting for. this is being pushed through so fast they won't have the time to do that before they vote on it. a lot of democrats are critical saying you're just making us vote blind on this thing because you think you have the votes. but in washington the answer is when you have the votes, you call the vote. that's what they're doing here. ultimately a lot of democrats will squawk about that throughout the day. if they don't have the votes, they can't stop it.

what happens if the $8 billion is not enough? there's a couple research reports out this morning quoting two conservative economists from aei suggesting that to make the program work, you need something like 15 built illion to 2$20 bi. >> the 8 billion, to be clear, is not the only money that's in there for that purpose. there was a larger fund that was created in the original bill. so this is 8 billion on top of additional money ithere. but even so, you're right. analyses suggest that this is not enough to deal with the cost of these pre-existing conditions. critics say that in the past, before obamacare, there were these high-risk pools set up for people with pre-existing conditions. and they were too expensive, ran out of money and didn't cover everybody. so the question is will that happen again with this? we don't know. we don't know which states will apply for the waivers to be exempt from the pre-existing

conditions. >> it's tough now to find the money to cover pre-existing conditions what was the state yesterday? they lost the last one. there was one left, they're losing the last one. which statement was tha was tha >> i don't remember. >> the losses were so big they're done. there's no one. >> when you ask the white house this question, the white house was asked yesterday, why are you doing this if you want to mandate that everybody with pre-existing conditions is covered, just simply keep the obama care language that says everybody with pre-existing conditions is covered? why go through this weird states thing, a waiver thing, why add that complexity and uncertainty when in reality the goal as stated is to cover all those people? what sean spicer said was they feel obamacare will fail, and that obamacare is too expensive, so a lot of people might be technically covered under the law, but if you can't get access

to the coverage, the program doesn't work. they feel this is their solution as convoluted as it may be. >> okay. >> eamon, thank you. let's talk facebook. the earnings just out. the social media giant beating on the top and bottom line results, helped by surging ad business. joining us now is victor anthony. good morning to you. this is a bit of a complicated quarter for analysts to understand. they changed the way they described some of the numbers. >> yeah. they went to gaap reporting, same thing that alphabet did as well. i think it's a good thing. more companies should go that direction. your headline on facebook right now? >> this is probably the longest streak of quarterly outperformance versus consensus of any company i covered in the past decade. 50% advertising revenue growth against that scale, probably doing $39 billion in revenues.

buying back stock. engagement is up. monthly active users is up 17%. 1$1.9 billion users. stock is up 30% this year. >> what is the stock worth? >> i have 1 $60 price t60 price the stock. strong ad demand, still undermonetized assets, what's app as well as messenger. there's possibly entering into china at some point. a lot of optionality with the platform now, undermonetized assets and growth are the core platform. instagram has been a home run for them in terms of acquisition. the free cash flow, that was up. >> everything is coming up roses except for the fact that it reiterates revenue ad growth will come down meaningfully in 2017. the back half of the year. what do you make of that? should we be concerned about

that? is that why the stock is trading lower premarket? >> they made that statement with the third quarter results. >> of course. now it's getting closer to the second half of the year, and it will come true. >> that's reflected in my numbers and consensus numbers. given the demand, that's one thing that came out of the call, the demand for advertising on facebook was enormous. price per ad went up 14% year over year in the first quarter, versus 3% or so, low single digits in the fourth quarter. demand for the platform may trump that commentary about ad loads they've been given. >> over the last several quarters prior to snap going public, we talked about facebook, you would always talk about snap nipping at its heels, or we have that conversation. how do you feel about snap now? >> first, there's nothing in the facebook numbers that indicated to me that snap has been an issue to them as far as advertising growth or user growth. i think they'll be challenged from a user growth perspective. particularly, you know, coming out of that core 13 to

24-year-old demographic. >> are you a believe their facebook has -- facebook's instagram has usurped snap? >> they replicated everything that snap has done. i think that may be an issue. >> will they be able to capture the younger audience that snap has? i'm probably using instagram more than i used to because of the new features and i'm not using snap. >> but can they get the 18-year-olds to do that? >> remains to be seen. if they do that, the value for snap is at question. that remains to be seen. i'm not sure they can do it or not, but they're giving it a try. >> do you cover twitter? >> i do. >> what do you make of the new tv shows that they'll broadcast. is that a good strategy? >> i think it's the saving grace for this platform. live video, video content is the direction they should go. i have a sell on the stock now. >> hasn't changed your mind. >> hasn't changed my mind.

i think there's challenges from an ad growth perspective. that may help. as with everything from the twitter, you have to wait and see whether or not it works. >> victor anthony, thank you. we have a lot coming up. tesla nearly doubling its quarterly revenue from a year ago but posting a bigger per share loss than expected. the stock is sliding this morning. we'll talk to an analyst next and get some thoughts.

hey, i've got the trend analysis. hey. hi. hi. you guys going to the company picnic this weekend? picnics are delightful. oh, wish we could. but we're stuck here catching up on claims. but we just compared historical claims to coverages. but we have those new audits. my natural language api can help us score those by noon. great. see you guys there. we would not miss it. watson, you gotta learn how to take a hint. i love to learn.

hey you've gotta see this. cno.n. alright, see you down there. mmm, fine.we got? okay, watch this. do t thing we talked about. what do we say? it's going to be great. watch. remember what we were just saying? go irish! see that? yes! i'm gonna just go back to doing what i was doing. find your awesome with the xfinity x1 voice remote. ♪ tesla reported a wider than expected loss for q1. a loss of $1.33 a share, vers an

expected loss of 81 cents a share. joining us is carl langdon from ubs. good morning. >> good morning. >> a miss of 60% -- it doesn't matter, right? all that does not matter for a stock like tesla. that's why you're sticking with your sell rating. >> still, the long-term story is about model three. that's what the bulls are buying. yeah, there's probably less focus than most companies on the quarter. i think the stock will be under pressure. if you go into their guidance, it implies a weaker q2. i would expect numbers to come down. we took our number down. >> they stand by a july launch for the model 3. they say they entered the end of the quarter with $4 billion in cash. they say by the time they launch the model 3, they will spend 2 billion in cash. do you believe that? >> do i believe the --

>> the launch -- the cash that thil ha they'll have by the time they launch? >> yes and yes. i would say this. i'm skeptical about the model 3 launch. i think july timing is aggressive. especially to ramp. i do think they'll get products out within the quarter? that's possible. the volumes may disappoint and the ramp may disappoint. the 2 billion in capex, they have already done about 600 million. there will be a giant spike. that's ahead of the launch. a lot of equipment needs to be added to the factory. >> we were talking before about my minivan issues, whether they were going to be -- the third row. that's separate issue. whether they would be able to grow, not just get on track for this year, but whether you can double capacity. >> the target -- their target is 500,000 by next year. i think, again, that's an extremely aggressive target,

particularly given their history. they have a history with the model x of delays, and the production schedule was slow. hopefully they learned some lessons, but these volumes are larger and they don't have a long track record. there's a high risk things get delayed. the 500 in general is a tough target. that would put them at best selling luxury car in the world within a year. that's aggressive. >> there's a certain amount of discounting in the stock, tesla says that, we believe x percent of that, and that's okay and we bid the stock higher. you look ten years out, they would have to sell about 2 million cars, about the size of bmw. so a lot of optimism. >> model y, 2019 aspirationally, 2020 launch. is that going to -- what will that do to your models? >> i think we have to get

through the model 3. what was interesting about those comments, they said 2019 which means we have to start building a factory and another giga factory soon, which is more capex. >> he said before the earnings call they would have four more giga factories. >> and that's a lot more money and they won't be generating the cash to fund that. we talked in other reports about the strinfrastructure needs. you will need more charging stations, more dealers. so that's all cost in capex. a long road ahead. >> colin, thank you for joining us. coming up, the countdown to tomorrow's big jobs report is on. we'll get you ready for the april employment data next. and president trump set to meet with the australian prime minister in new york today. we will talk with the former prime minister, kevin rudd, at 7:30 today. before we head to break a look

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probably less concerned with the jobs number. it's as important than believe it or not some developments in washington today. the healthcare vote, which could come this morning. they never did vote. they never did vote. >> i know. >> will be compelling to watch. i might watch it. this is my life. i told you i watched the le pen/macron debate yesterday. >> how did that go, considering you don't speak french? >> it was on cspan 3. >> had subtitles. >> no it was an interpreter, but a lot of french in the background being spoken by the moderate tirors trying to contr and the candidates speaking at the same time. >> if this passes today what do you think happens to the senate bill? >> the senate, i'm not an expert on. >> we're all talking about this. >> the first obamacare, they

went to the senate, did all stu didn't get passed back. does this pass muster for reconciliation in the first place, that's what charles schumer was asking yesterday. you got to do this before you do anything else. for more on the jobs record and broader markets, let's bring in lindsay and david. just since it's staring us in the face, the jobs number tomorrow and because of what we saw in the last report, and that 0.7 gdp, maybe it's a first quarter thing, maybe it's not, what you are looking for tomorrow? >> the market is looking for a rise of 190,000. slightly less optimistic. we're looking for about 175,000. even at the 190,000 number, you're still talking about a moving average around 180,000. month to month, yes, we are

putting americans back to work. you can see a noticeable slowdown in momentum from a pace closer to around 230,000, 250,000 in the previous 24 months. so, from the fed's perspective, y the la yes, the labor market is on solid ground but far from rob t robust. against the back drop of a weaker than expected q1 gdp report, we'll be looking at the april number with more scrutiny to get a sense of whether or not we can expect better growth numbers in the second quarter and beyond. >> someone pointed out yesterday it was a good quarter for corporate earnings. what if you look at this as a -- as sort of a governor on fed rate hikes. and so once again, with -- we got this goldilocks scenario, profits are going well but the fed won't overstep in terms of rate hikes. it's another good scenario for stocks, isn't it?

>> well, it's interesting because when we look at the statement, the fed was actually cautiously optimistic subjecting the weakness in the first quarter was likely to prove transitory, but they did not dismiss that weakness. they're still cautious. looking at the may statement, there was no specific reference to june, meaning that if jin un was a forgone conclusion, we would have seen ti-specific language, such as in the coming months, and we didn't s that in the may statement. the fed is still hedging in terms of additional policy adjustments in the near-term, waiting to see if we do, in fact, see some better numbers translate into improved gdp. >> david, you're still buying. you like growth stocks. why is growth better than value given the economic background? >> tech has done well. yes. we continue to recommend growth stocks. tech, i would suggest even for the summer, really rotate into healthcare. i think we'll have -- it will be

clear that there will be reform in healthcare, but incrementally, moderately overtime, healthcare stocks are still delivering strong earnings sales growth. not as strong as before, but relative to the rest of the market. at a 16 or so pe on a forward basis that pe should be 20 with interest rates. now, it's growth stocks, tech and healthcare, and the one exception in value is banks. we do expect the fed to hike in june. labor market is on track. so when you look at the u.s. market, tech, healthcare, and banks. something i'll be discussing on our monthsly call for financial ed advisers today, we're looking for value opportunities in europe. we see value opportunities in i industrials in europe and now financials as well in europe. >> if le pen won -- >> we don't expect that. we would have to reassess our

view. as we said before, it was more likely -- change can't happen overnight. you can't exit the eu overnight. so the point is first off macron will win. we're already positioned that way. >> stay away from oil. >> that's something we've been saying for a long time. stay away from energy stocks. worst performers year-to-date. that's a big reason why i don't like value. many u.s. industrials stretch as far as valuations, though things are bter there than i thought. the truinfrastructure spending something long down the road. you're better off looking at european industrials. but in the u.s. market, tech, healthcare. >> is there anything that would cause you to say sell 30% of your stocks? >> you're usually asking me to go 130%. >> right. what happened? >> i want to know. i worry about -- >> yeah. >> i always worry about -- north korea, or -- if some outlying

black swan happens, the market could george bus could -- you could lose a lot. >> yeah. i agree. >> what would it be? north korea? >> we already navigated the profit recession that we expected from the collapse in commodity prices. that's an important threat to earnings and the market behind us. now we're focused on interest rates. this is going to be a long-lasting expansion. we need to make sure inflation doesn't overheat. we do have evaluation s dependt on this but i don't see strong inflation threats out there. >> david, thank you. lindsey, thank you. have you seen in the last couple weeks we launched an icbm that travels 5,000 miles and hits a target. this is at the same time their

scuds are not making it into the sea of japan. you guys are doing that, trying to miniaturize your weapons to put it on one of these things. this is what we got right now. this case you were wondering. it's weird that we've done two in the last couple of weeks. this is scary that we're actually showing what we have. did you see north korea rebuked china. they never do that. >> yeah. >> they said this crazy, you know, this incendiary language. >> this is your black swan for the markets? >> that's my black swan for the world. hawaii, california, japan, south korea, it's -- these are -- this is -- >> right. now it's real. >> when you got an unhinged crazy guy leading the country -- i'll not talking about trump, andrew. at me and thought -- he looked >> him. >> yeah. >> no, i didn't. i knew when you started down that road of thinking you would then about to -- >> it was a joke.

i was leading into -- >> got to watch out with the jokes. the north korean guy. >> ceos sound off on tax reform. the head of the business roundtable is here to reveal the new results of a survey. and at&t ceo, randall stephenson weighs in on media deals and the tax plan. stay tuned. you're watching "squawk box" on cnbc.

some stocks to watch this morning. fit dbit beating the street, saying product launches for this year remain on track. square's results topping analyst expectations. the payment processing company raising its full year outlook. shares up about 3%. avis reporting a larger than expected loss citing higher fleet costs, price pressure and a late easter holiday. shares are down 7.5% now.

time for the executive endg. we told you earlier in the week that millennials are set to be the least entrepreneurial generation in history, they're being outpaced by baby boomers. kate rogers continues her tour for national small business week with that story in philadelphia. then i got a quick update at the end, kate. i don't knead need to involve everyone else, but i will at the end. take it away. >> thank you very much. when it comes to launching new businesses, millennials are being outpaced by baby boomers like philadelphia-based brian kravits. kravits began fixing type writers in the 1970s. he changed careers once computers came on the scene but realized typewriters were back in vogue. at age 65 he launched his new business philly typewriter because he said he's not ready to settle down and retire just yet. >> i'm i really good health.

i've -- i just feel good. i get up every day. i don't want to sit around. what can i do? go to the golf course? no. not me. i want to do things. >> kravits says years in the work force have helped him to run this late in life venture successfully. he's already making money doing it. this rise in boomer entrepreneurship is partially a byproduct of the great recession but also the new retirement in which many americans have decided they're not going to retire at all, at least in the traditional sense. >> work is an important, you know, emotional contribution to peoples sense of identity. i don't think that disappears just because you hit a particular chronological age. >> in 2015 the kauffman foundation said baby boomers

were twice as likely as their millenniumal millennial counterparts to launch a new business. on june 7th we have some great speakers at the iconic conference. >> it's hard for a millennium, if you're snapping. how do you do that? how do you find your -- raise money, you know, rent a place for the business. do all this, while you're snapping the entire time. it's difficult while you're on your -- any way. i wish millennials will get with the program. >> snapchating? >> i'm not expecting it any time soon. >> well, joe, i am a millennial, so i'll try not to take offense to your lack of hope for us. but for what it's worth, i'm not on snapchat, maybe i'll give you

hope for the generation. >> you do. what i was eluding to earlier was your video -- your netflix taste, bloodline comes back may 26th for sb threason three. i was thinking of you. we visited the rayburn -- the place in florida, down in the keys. >> you di >> yes. >> i got a lot of reall -- >> nice. >> -- cool pictures. it exists. but it's more beautiful than you can tell on the series. i was going to send you pictures, you would be like why is this guy sending me pictures. when you come in, i got them all. >> you can send me vacation pictures any time, joe. >> that would be weird. kate, here's my vacation -- but it is -- if you didn't know what i was sending you, you would be like this guy is weird. >> she may not want to open the pictures. >> you'd be afraid. >> i'd be afraid. >> could be weiner gate all over gate. kernen gate. >> oh, god.

>> just went there. i knew that went e. whhen you s with sending the pictures this is where we would end. it's natural. >> i am not being to send them to you. they're on my iphone. >> what else is on there? >> it exists. >> this squawkard moment has been brought to you by joe kernen. >> it's in islemadora, halfway between key west and miami. it's stunning. i have pictures where danny is there. >> great. i can't wait to see. >> may 26th it comes back. >> thanks, joe. >> you watched a couple, right? >> i have. >> excellent show. >> unbelievable. >> unbelievable. >> i don't want danny to be -- i don't want -- never mind. >> i want to thank you for sending me the vacation photos. we enjoyed those. >> did i send any to you? i'm going to. >> coming up, spending on home renovations picking up. a new report says it will continue to grow this year.

details straight ahead as we head to a break. quick check on what's happening with european markets. green across the board. "squawk box" returns in a moment. when this bell rings... ...it starts a chain reaction... ...that's heard throughout the connected business world. at&t network security helps protect business, from the largest financial markets to the smallest transactions, by sensing cyber-attacks in near real time and automatically deploying countermeasures. keeping the world of business connected and protected. that's the power of and. ♪

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first time home buyers and millennials are spending more than ever on home renovation projects. the report predicts even more spending in 2017. i like going to house just to look at the pictures. >> i have the app here. >> do you hang out on houz? if you nd toook for furnitu furniture, renovatn ideas, it's like the greatest thing ever. >> i bet your wife knows about it. >> renovating. we do but i wasn't that involved in the actual choices. i was very involved in certain ways but not involved in the choices. >> paying for the merchandise. >> exactly. >> so help us try to understand

where you think these renovations are taking place. is it a regional issue, by the way, in terms of where this is happening? >> generally what we have seen in our house data is the renovations are very much concentrated on the west and the east coast. it has been going on in the last three years. as well as the urban areas. that's where we're seeing a lot of concentration in renovation. first time home buyers spning is -- spending is up. >> what are they doing? >> the renovation cope is very large. multi-home renovations, three rooms on average at a time, especially -- >> kitchens, bathrooms or something different? >> discretionary spending is leading, kitchen and bathroom is big but roofing, siding, outdoor

upgrades are very popular right now. outdoor lighting is very much in. it's a full whole house renovation from the exterior to interior. >> is this driven by low interest rates? how are people financing this? >> generally with interest rates on the rise, it's a great sign for our industry. in our industry, when homeowners are staying put, longer the stay in the home, they invest more. >> but also you got toot supply so people are staying even with mortgage rates low. >> tight inventory is a blessing and a curse. >> do you think that millennials are more inclined to renovate than others, generationally?

>> our housresearch shows baby s are are spending three times more than the millennials. the concentration of renovation activity is on the older generation. millennials, first-time buyers -- >> are they renovating places they own or buying places and renovatin renovating? >> the baby boomers, 55 plus, they're staying put and they're investing the dollars. in term of the millennials, they are clearly the new blood in the home ownership realm. they're coming into new homes and renovating and customizing their new homes. >> i thought they were still living with their parents. >> is it because they're buying fixer-uppers, they're going to a

lower price point and they have to put more money in to make it acceptable? >> the 22% is reflective of the fact that the those priced out of homes are going into older homes so they have to invest the longer they stay in the home. it is a reflection of the quality of home they're purchasing what's the most popular thing people search for on a house. dunk? >> in general we shall have a very broad offering. >> there as not just one thing people are looking for in. >> kitchens and bathrooms have been a very large -- >> always. >> absolutely. now we have over 40 million unique users on houzz. from kitchens to bathrooms and all the way to shopping on the marketple, it's everything. >> thank you.

good luck with your own renovations. >> shares are under pressure. still ahead, the business roundtable conducted a survey on tax return. josh bolten will join us to reveal the results next.

. earnings alert, facebook posting blockbuster results but are the days of easy growth over? straight ahead. >> new this morning, republicans say they have the votes to pass an obamacare replacement bill.

>> and a key read ahead of tomorrow's jobs report as the second hour of "squawk box" begins right now. >> live from the beating heart of business, new york city, this is "squawk box." >> good morning. welcome back to "squawk box." we're live at the nasdaq market site, andrew ross sorkin along with joe kernen and melissa lee this morning. the nasdaq looking to open up 9 points higher. we talked about it earlier, facebook shares are under some pressure this morning, despite earnings and revenue that beat street forecasts.

a warning from the giant that a growth will slow down for the remainder of the year. tesla posted a loss for the first quarter. the automaker's revenue did come in above estimates as it delivered a record number of its model s and x vehicles. and heinz is hurt by weak demand for the food makers' products. >> the other big story investors need to watch this morning is the health care vote. hi, eamon. >> around lunch time today they'll begin with procedural votes early this morning. but kevin mccarthy offered an optimistic perspective about what's going to happen today.

here's what happened last night. >> feel great about count. >> you have the he said he thinks they have the votes and why they have the votes is because of three amendments passed in the rules committee sterda the upton amendment would provided 8 billion over five years because the original health care balance here remove there was sot concern that wouldn't teak car of enough people with that insurers cover technical medical procedures and a mcsally amendment that allows

congress member to be exempt from this health care bill so presumably house the the house will have to live with whatever happens today. if they get over the threshold of 216 votes this afternoon, which is not entirely guaranteed, what happens in the united states senate is anyone's guess. right now the guess is they'll strip out a lot of these provision and put in stuff of their own. when they conference the two bills to the. >> you'll be in the vicinity. >> i'll almost never leave the belt way. >> and i have urged you at times

maybe that might be a good idea to ksh. >> i thinkhat one to you. >> you did. >> no, i know. i rarely give them to you and you swing at the pitch. >> i rarely leave the belt way. >> you don't want to leave the beltway. it could be dangerous out there, people aren't wearing brooks brother. >> okay, thank joining now president and ceo josh bolten. if you want -- anyway, great to

see you. thanks for coming in. who better to talk about tax reform. they all say this is what we want, this is what we need, we'll start doing all the right things in terms of capital expenditures, we won't buy back stock anymore because interest rates are so low, we won't do sort of financial engineering to juice our results, we'll really about do what we're supposed to do. would they? >> absolutely. >> that will spurt them to not on do what would be the right this evening long term but maybe in their own self-interest. >> absolutely. they're all doing fine as it is and their share pra os, if tax

reform of a reasonable size went sfrchl sfchl if tax goes through in a reasonably substantial form, oaf 70% say they will hire more and a large number say they'll invest more. >> and that's what this investment is good at. you got to get the p.r. people say why feed the fat cats

more? the narrative works if you can get the message out. otherwise you get killed. >> that's what the message says. >> you got to convince andrew. do you think that filters down to the people we need -- >> we had a reporter come on from kansas, i don't think. and the experience is an interesting one. the idea was going they were if and what they've found kr. >> revenues have been down so they've had to cut things like education in other areas and they haven't had the sort of boost that they expected. by the way, some companies are prompted what does that say

about the rest of the country? >> state taxes are significant in some places but what really dounts most of our corporations is the federal tax rate. it now the highest in the shelled world. 35%, a lot of our companies are paying somewhere around 35% effective rate. we got to get that down. we're making ourselves uncompetitive. >> the premise is it will make for strong are economic growth and then the growth add then we'll hire. i mean, they have to see it filtered to gdp first and then they hire. >> there's a warning in the survey as well because we ask if

tax reform is delayed, what will happen? and a marriage of our members said that plans they now have on the books to hire and to invest, to do more cap checks, a majority of their expig i overwhelmingly our ceos are saying if tax reform goes through, i will hire more and spend more the if it's delayed for any sstantial amount of time, they're going to take clouds off because a lot of our ceos have bikd in so critically

long ter if -- what the survey would say to me is time to focus on that tax return and get it done this year. >> do you feel reince priebus's pain? is it worse now? has it always been terrible? >> being chief of staff is a hard job. it also one of the best jobs in the world if things are going okay. >> do you get great tables at restaurants? why is it great? >> you get to work in the white house and you get to work on what's important. if you're chief of staff, get to work on what's important to the president and the country. it's a terrific job. i do feel for reince because it a hard job to do in a new administration. it's an even harder job to do if a new straegs the key.

>> yeah, we've tried that. >> it worked okay when i was there. >> yes and no. >> but we got a different kind of president now. >> you didn't get much done. but the second term not a whole hot happened for w. but i will tell you that i think they can get things on the right track. here's where tax reform comes in. the health care stuff i think is now defensive for the republican party. it just important to get it done, get it out. the way. but to really put points on the board for the leadership in the house and senate, for this

president, i they tax reform is the key and i think they well ceos who think they're about to have a meeting with donald trump, they all privately talk what is it we can say and bring to him to show we are seeious about new jobs in america? why is that happening in administration? i say to the president's credit, the fact that he's actual will been able to get us to even think this way in a way that didn't feel that way under obama, dare i save under bush and probably evennd clinton. >> there's a couple things going

on. which the ke. the other thing is across the board our ceos are saying, wow, they're really listening to us. mplaint about a regulation, we've got a situation that's holding us back unnecessarily. >> how much of it is part of -- meaning and thinking if i can get him some points on the board, maybe i can get a point on the board. or maybe i can avoid getting a sweet storm on the board you understand that? >> i do. >> it's just you weren't

expecting -- ♪ >> enter joe six pack? >> yeah. i'm proposing this to someone in france. >> you know who this is. ♪ something we could never live without ♪ >> michael bolten. how am i supposed to live without you, now that you're leaving, korb? >> this sho has sunk to a new level. a new level. >> playing michael boaton. ♪ the show's about to start! how do i look?

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of the billboard music awards just by using your voice. the billboard music awards. sunday, may 21st eight seven central only on abc. welcome back to "squawk box." an op-ed in "the wall street journal" this morning outlining a new plan to streamline and consolidate trading she says has become fragmented. many of the changes are focused on promoting long-term thinking instead of satisfying short-term investors. adena free man will join us to

explain. >> a lot of questions about the future seem to be weighing on the shares this morning, especially when it comes to where revenue is going to hit. for more on that, mark mehenny, lead internet analysts. >> since you're the lead, does that mean there are others? >> yes. we're a team. we're friends. >> you're the leader? >> yes. >> would you be happy with this report? >> yeah, we were happy with it. the stock is up 30% year to date. they reiterated. >> is it an, pence story or a revenue -- >> this company should be aggressively investing. they're going to do about have

completely unmonetized facebook and tur. this is probably the single best growth story -- >> do you have ideas on how they can monetize what's app and facebook messenger? >> i think now they're trying to figure out how to insert ads. >> have you seen anybody monetize messengering in a meaningful way? >> yes, but not in the u.s. >> how do they do it? >> there's a lot of gamification of the apps and advertising align in johnson does this, --

does this and two in china. i think this can be done. you are inserting ads in people's conversations but that's what they did with saz because snap was supposed to steal the thunder of facebook. >> if there's one major risk to snapchat, it what facebook is doing. it's one of the riskiest prks all of the ad format that oo prng and they repurpose it for other platforms that are that much longer. >> how much better can faked

target that ad? in tr pb be fwrks fwrk you're really starting to see pricing take off at football, i think. so they'reor an alphabet and it yes, it probably not actionable. and wofr that kfrmt if there's ever one company in i mean, absolutely, they count for 95%

of search in the u.s. and in europe. those are pretty strong numbers. there are a few things goolle has done over time by putting some of its own results in the search results that do look monopolistic >> where do you stand on >> we continue the sell on that. last quarter was interesting, if they can show a couple quarters in a row of up 25% or so in pat month. but we'll see, if they can continue to reaction sell rate -- they've done a few thanksgiving to in the i use you

for a certain thing, leave me alone. >> what are you following. >> i don't know. this person said this. i only follow a hundred people. >> mark, thank you. >> @joesquawk or something like that. >> ahead of this weekend's people's election in france. i just requested more michael boaton. >> this looks look a gate ho coming up, why you need to pay attention woor it here's what jim kram are said to what frp

and so we're buying it back. so from that pointf view, there's an opportunity in that as well. but over the long haul, i think it will -- i strongly believe that it will be at a fair value. and so that's how we look at it. then we're gonna go in and remove your '67 corvette. my vette!? it's just a gall bladder! you don't have.. aflac! paying you cash, so you might have to sell that sweet little muscle machine just to cover your rent. more funny juice. but my papa gave me...that...car. what do you wish you had? aflac. ohh, i love doing that. health can change, but the life you love doesn't have to. keep your lifestyle healthy with- aflac!

when we return, breaking economic news, we're going to talk layoffs unfortunately. and former prime minister kevin rudd is going to join us on the set. find out what he wants to hear when president trump and the current prime minister meet today. you're watching "squawk box" right here on cnbc.

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outlook profit was down 60% from a year earlier on higher programming costs and lower sales. you're seeing the stock is a little bit up this morning. it's been a bit of a roller coaster ride.

also american airlines back on capitol hill facing a senate hearing. scott kirby will be there this time around. they spoke about the dragging of the passenger off that flight last month. >> morgan stanley customers will no longer be able to buy van guard mutual funds from the firm. they want to weedut less popular funds. however, customers will not be forced to liquidate van guard positions. van guard does not pay firms like morgan stanley these fees. >> i do have a lot of things i like to talk about. that is something we have together. yesterday did you see the media stocks based on this hulu thing, $40 -- >> it could have also been on to report about cord cutting. >> but yesterday the media

stocks across the board -- i thought cbs initially was down because of colbert but i don't think that's -- >> no! >> i know you loved it. you don't think they should be saying that kind of stuff? >> he said he would not have used that same language. >> that's big of him but you saw the fcc commissioner say if this is obscene, there's going to be consequences. >> it's not obscene? >> i'm saying the language was huge. >> what if somebody said that about president obama and the last administration? you don't think it might have been more -- >> i think on all ends -- >> does it matter that he was talking about a president or the language he used? >> both. >> i think it just matters what language you use. >> okay. >> all right. >> in the debates yesterday they were using french, which made it very hard to follow. a fiery face-off in french as the nation's two remaining

presidential candidates, mary le pen and centrist candidate, emmanuel macron squared off in their final debate, watch this. >> translator: what are you going to do opposite mrs. merkel? you said i won't be opposite her,'ll be with her. >> translator: of course i want france to measure up to germany. >> translator: france will be led by a woman, either me or mrs. merkel, that's the truth. >> that was a great sound bite. the other great sound bite we've talked about in a purent way when le pen said "don't play games with me, this is not a student/teacher relationship, i'm not into that sort of thing." this debate is just as bad as

one of ours. >> and of course a reference to the fact that mac -- that's increased his appeal in france. >> i think the point in takeaway, you know, whether there was some point scored by le pen on that was that mr mr. macron didn't have a car crash moment. le pen otherwise has actually gained ground. we gone from 65/35 to 60/40 so still a massive margin it make up. it's been a bad ten days for macron. so a little bit more confidence coming away from this. there's certain areas you could

point to -- like sounded nigel. and so much talk about currency and so much talk about the euro. >> that's what macron pushed back on saying it going to cost the bregs i think this is an area where there has been complacency in the market in the long terms. france of course is relatively one of the strongest economies

in northern europe. and le pan has done better where unemployment has been and the top two but to say extrapolate from this and say the problems are there isn't -- >> you got the accent down. >> you've got the british accent down. >> that one i practice. >> he goes in and out on the british accent. >> they're telling us i need to go but i need to know about the royals. >> overexcited overnight because we knew there would be an announcement at the age of 95,

that's to be expected. the quinn continues with all of they are -- >> how great is that, that he did it to 95. >> still all the way up to 94 1/2, he still has a full schedule. >> so do i. >> just know it's going to be fun. >> just know that. i'm not going anywhere. >> okay, let's tack jobs and chris out, it wrings brings the apartment of jobs cut year to date is at the lowest level. big headline, john, is what? >> i suppose the key here is what we're seeing most is that retail is the dominant sector that's shedding jobs, just like energy last spring, first quarter, was shedding jobs at a rapid rate. retail right now is dominating

with many store closings, several thousand store close announced so far this year. >> and none of it is season certainly but this seems to be now more long term decisions to cut costs and react to the e-retail phenomenon. >> let just talk regionally. where are you focusing? >> heaviest cuts so far and in the month were california, ohio, texas, so really spread, no particular region hit haest. that makes sense. ra rail. >> so hey hi joining us now is kevin rudd, former prime

minister of australia. >> the traffic on the west side today, just think about it. >> it going to be who were. >> a hort of a good relations between i'll bet you things go better than what theme pi today. spm sfm snfrm. it's not. these things happen. bad telephone connection.

grumpy people on the other end of the phone, that's it. but this align has been going on sense 1941, sur voofd 12 or 13 prime ministers, including me and survived about 12 or 13 u.s. presidents. so the key thing is security relationships betwe the asian-pacific region, topic number one is north korea. it's not going to go away. it's getting harder, not easier. the core should be on the question of focusing, on what leverage both governments believe china can apply to the north koreans to bring about rile and i can name about. >> he's a beg personality but very easy to get along with in a way. >> yes. >> and president g, rapport. netanyahu rapport, abbas

yesterday, rapport. you just hear again and again when you meet him personally, and that's helpful in lot of these situations and two-thirds immovable national interest but one third is about do these people get along. that affects how you prosecutor the business, whether it's on trade, security or other dimensions in the relationship. what i've seen with president trump so far, particularly in his dealings with xi jinping from china, despite the enormous cultural divide, that so far has gone quitewell. for this one i don't see any hugeproblems, other for those poor commutes are later this afternoon who are going to get upset. i'll be making my way down to the intrepid as well.

>> down to the intrepid. what do you think finally happens in terms of china putting pressure on north korea? they're the only ones that can do it, aren't they? >> i think if you strip all diplomatic stuff away and just go to the core national security questions here, there are three of them, i think. one is will kim kicjong un resp to any pressure of any form, political or economic? i think the answer to that is highly unlikely but still possible. second, what would turn husband dial -- his dial on this stuff? that is if china switched off energy supplies, aviation gas, and simple refined petroleum. they are hugely dependent on those supplies from the china ands they can't get it

elsewhere. so the third element in the occasi occasion. >> what prevents them from doing that? >> the chinese are deep strategic realists and they ask this question, and it's not a dumb question -- okay, we tur the dial, there's huge destabilization in pyongyang, kim jong un, if he goes, who do we get? >> so the devil you know -- >> it's not quite that. the chinese have an aversion for strategic uncertainty. one thing that was disturbing about the president trump in the first place is the president's often stated interest as being unpredictable. that doesn't fit the chinese play book at all. but vis-a-vis north korea, it's quite hard because the opinion

who comes next, do you have a general military breakout at that point with some north korean general taking over? do you then have a war in the peninsula and does it all boil down to big, general war? >> rex tillerson yesterday spoke to the state department, talked about the division in terms of how he's thinking about policy versus values going forward. >> hmm. >> and human rights and things like that. how does that change the dynamic? >> you know, the united states because you're always consumed in your domestic politics and i understand that, i've run for office in my own countr but you know somethingwhen people look around the word at you because if you're going to be historically lights on the

hill, out of roosevelt, out of truman, reinforced by its en worry wise it becomes like anybody else. >> so do you think this is a mistake? >> i don't know secretary tillerson andes only been. >> coming up, a new era of trading. and adenna friedman will join us in just a moment. can we push the offer online? brian, i just had a quick question. brian? brian... legacy technology can handcuff any company. but "yes" is here. you're saying the new app will go live monday?!

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today oracle mark hurd, the cloud competition and race for revenue. welcome back to "squawk box." nasdaq ceo adena friedman is here. she's out with an op-ed in "the wall street journal" today. she joins us now to talk about it. you go through a couple of different things in terms of market structure, in terms of what type of -- how activism can work and what shareholders should be able to do. what's the big headline you want

to take away? >> i think the goal is to reassert a balance between the private and public markets. we're a big believer in that balance. we have the nasdaq private market, we talked about that before. we want to make sure every investor has an opportunity ultimately to join in the growth and success of these great companies that we have that have been formed in the united states. we also see that 74% of all job creation over the last 16 years has come after the company's gone public. if we don't have the companies go public, it could ultimately limit the jobs they're able to create and achieve. and yet companies are really hesitant to join the public markets. and if you look at it, we do believe that an imbalance has been created over the years of regulation and creation of different structural issues we think we need to revisit to reassert a balance. >> one of the things you talk about is technology. the other you talk about is shareholder rights and how often

times small shareholders are the ones that are making a lot of the proposals rather than ones with true skin in the game. not to say they don't have skin in the game but on a relative basis and what should be the threshold. >> that is the big debate. proxy access today means if you own 2,000 shares and you own the stock for a year, essentially you can come in and propose significant -- >> $2,000 worth of shares. >> i'm sorry, $2,000 of the share, then you can propose major changes to a company's governance and structure. what we found was that 30% of all of the proxy proposals last year were proposed by six small shareholders. clearly that's become a cottage little industry for them to go and agitate at the companies. our proposal is an investor should own at least 1% of the shares and have held it for three years. so they're a long-term investor, they have real skin in the game and therefore proposing the ability to come in and suggest changes to the governs and

instru -- governance of a company. entrepreneurs come in and they have easy access to capital on the private markets. and at the same time they want to be able to tap the public markets but they want to be able to maintain their long-term view of the company and be able to manage it for the long term. so should we make it it these companies are incentivized for a small subset of investors to have access to the companies or so long as things are disclosed and they understand they're only buying into a financial interest that a broad sector will have access through the public markets? >> so one of the big issues has always been the idea -- over the past 20, 30 years we've tried to democratize investing. i think it's what cnbc and

"squawk box," what we've always tried to do. and the idea of a level playing field has always been at issue. >> yes. and dual class or changing the threshold on whether you can make a proposal and maybe a level playing field has always been an artifice and a lot of people believe that. >> from a financial perspective, i think that's a really, really important part of wealth creation in this country. but the question is at what point does it go too far in terms of a very small investors beingabl to that's not necessarily good for long-term job creation and growth. >> are these things that are preventing companies moving from

the private market to the public market? is this why you're out against -- you want to see that wave of ipos unlashed? >> our blueprint is very comprehensive. there a lot of reasons why companies are much more hesitant today to go public, litigation issues, i think there's some tax benefits. in asort termism, activism, these are things we're talking to companies about as they're considering tapping the public markets. it's a big, big step to go public and it a more attractive. it makes it harder for them to

get back on board and it makes it more of a professional's game. >> i disagree with that. i think at the end of the day the key goal of investor access into the market is wealth accumulation and the ability for them to join in our companies through the investment of entrepreneurs. sometimes you have to make sure the companies feel they can control the future of their company while still giving investors financial access to that company and that's what we're trying to create here. >> it's a longer, larger conversation. since we live together, come on back. >> thank you. >> you better. 00 years since the first stock index was created, as a benchmark for average. yet a lot of people still build portfolios with strategies that just track the benchmarks. but investing isn't about achieving average. it's about achieving goals. and invesco believes doing that today requires the art and expertise of high-conviction investing.

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the house set to vote on a replacement bill today. >> i feel great about the bill. >> everything you need to know out of washington straight ahead. >> and randall stephenson talks krp ceo optimism, the president and getting it down. >> and may the force be with you as "squawk box" begins right now.

>> announcer: live from the most powerful city in the world, new york, this is "squawk box." >> welcome back to "squawk box" here on cnbc. that music is just -- i feel, i don't know, i feel like going out and doing something like for good. >> like what? >> i don't know. some good. doing some good. >> do some good together. >> we do every day from the nasdaq market site every day. i'm joe kernen along with andrew ross sorkin and melissa lee. becky quick is off doing good to talk to oracle. the futures now indicated higher. i would say it's not a stretch, believe it or not, what does health care repeal and reform have to do with the stock market? it maybe means a bigger corporate tax cut. that is the top story and

druchdruc -- andrew's going to talk to you about right now. >> house majority leader kevin mccarthy calling for a vote on the gop's health care bill scheduled for this morning. mccarthy says republicans have the vote to pass the bill. republicans spped that previous version obamacare replacement back in march. the latest version contains -- tom price explained why he thinks it's necessary to repeal and replace obamacare now. he writes, quote, if a house is on fire do you not wait for it to burn to the ground before trying to save the family inside. he said health care is in a death spiral. debate continues and we'll see

if it gets passed and then has to go through the senate. >> and does it pass muster on wrereconciliation, too. >> there's a lot of questions. >> it's complicated. that's why i don't know if the market should -- >> it's 50 points. >> along the way. >> i know, it's 50 points. >> apple ceo tim cook will start a $1 billion fund. >> that's a billion dollar of our money but we're really proud to do it. by being that, we can be the ripple in the pond. if we can create many manufacturing jobs around, those manufacturing jobs create more jobs around them because you have a service industry that builds up around them. we'll b announcing the first

investment in this fund later in the month of may. >> and our top stock to watch this morning is facebook. >> facebook beat expectations on the to t the top and bottom and reported 2 billion users. they expect a slowdown in ad revenue growth and an uptick in expenses put pressure on the stock. ceo sheryl sandberg told me, they benefiting -- she also explained yesterday's announcement that facebook is hiring 3,000 more people to monitor videos. >> we're in constant

conversation with our advertisers but we have not seen a revenue impact from this yet so that's no why we did this. we did this because as take every step we can and that includes hiring more people in big numbers, as you saw, but also building better tools to keep ous safe. >> and they're making changes to crack down on fake news and hoaxes and he said they're laying the groundwork to turn messenger into another profit engine. what were your big concerns going into the quarter and did facebook address them? i would imagine the violent content might be one of them. >> the inbomb inable content that facebook carries on

facebook live and other sites. dziuk ber -- zuckerberg is not doing much despite this. freedom of speech, no. he's got to draw a line. there are companies out there that have software that can stop these sites from even getting on to facebook but he's not using them. he's trying to cut down the time that it takes to stop and help if somebody is in a dier situation. from a shareholder's standpoint it doesn't matter until advertisers pull out en masse. >> when you saw 50 plus advertisers pull out of o'reilly on fox because of allegations of

sexual molestation and harassment, that's going to hit back soon. advertisers do not wan their ad on objectionable sites and even an hour or two, what it's taking on fabds now to get them off, that's not acceptable to an advertis advertiser. >> in terms of the news feed, they've really cleaned that up, correct? >> zuckerberg, let's give him credit. he saw mobile as the dominant medium years ago and now he sees video as the dominant medium on mobile and what's happening is facebook is the first, highest two happens that anybody globally picks up and he's not -- he's got to be aware of the advertising -- >> so the reaction just hasn't caught up. you will see it is your prediction? >> that's right. >> porter, thank you. >> we have some time left. but they got to hire 3,000 people just to watch -- >> on top of the people they

already have. >> and they have 4,500 people now. >> watching -- >> monitoring and -- >> what is it now that they have? they need to monitor a lot. >> you're saying if there's a billion users. >> that shows you what a billion entails. >> why can't they watch this stuff? i mean, 3,000 people? >> that's an first amendment issue. it took 24 hours to get the murder video that that guy in cleveland posted in facebook. >> just the sheer size -- it's a thousand, thousand, thousand. >> there is software out there, thd-party software that could prevent -- one of the things that nobody's talking about is the enormous recruitment postings that isis and other terrorist organizations are putting on facebook and google and they're not stopping it. >> cesspool, andrew, i'm telling you. it's the end of the world. it's the end of the world. >> you think they're not policing the isis stuff? >> well, they take it off but it

sits there for x number of hours before and they can stop it. there is software out there that the story fold that you mentioned that fox just deployed to stop fake news on fox sites, why isn't facebook using that? there's another company called g-pack that can stop it from getting on there. his priority is cutting down the time that these things run on facebook because he wants the advertising to be there and the advertisers are going to resist. they're going to say, no, we can't be side by side with objectionable programming. >> four horsemen. facebook, twitter, take your pick, snap and the apocalypse. >> focus on video and live video. twitter's going into television. facebook is exploring putting tv

programming, content on and all of their technology is amazing and mind blowing but thief ggavo do something about the objectionable content. >> just because you can do something doesn't mean you should do it. >> phil leau joins us now. >> to be honest, very few people were focusing on the numbers of whether there was a bigger loss or where it came in relative to the revenue of the previous year, which by the way, they beat. 1.33 was the lost versus the estimate of 81 cents. everyone was focused what is the guidance when it comes to the next vehicle coming out and that was with the model three. tesla reaffirmed it will begin production in july. the plan is to build 5,000 model three vehicles, not all vehicles

for the company, and then 10,000 per week in 2018. here's elon musk talking about what happens after that as the company moves toward its goal of building 1 million vehicles perrier by 2020. >> i think we need to come out with the model line sometimes in 2020 or aspirationally late 2019 and then i think that a million units is quite likely. >> by the way, the model y would be an electric crossover utility vehicle. we're showing you tesla versus apple over the last year becauson the cabecause on the call there was a very specific question about whether or not tesla and apple could ever partner up. here's what elon musk had to say to that suggestion. >> yeah, i don't think they want to have that conversation.

but apple makes some great products and, yeah, i mean, i use their phone, it's cool. the laptop is cool. >> that's all he had to say about the possibility of tesla and apple partnering. could tesla ever get a valuation of -- or a market cap of $700 billion? they're at about 50 billion. he paused and said i don't want to sound delusional, i don't think we should sound delusional but i see a clear path to that happening. >> didn't he say that to a letter he wrote to the workers in -- >> he wrote a while ago and someone reiterated it and said market's apple cap is whatever it is, could you see yourself getting to that level? he said i see a clear path. >> where are you going to sit,

lebeau, on the airlines? >> because they got rid of the two inches. >> he's an airline reporter, you don't think they're going to upgrade him? >> let's go all over the country. >> you can't fly american anymore. you need a shoe horn to get in and out of your seat. >> oh, come on. >> thanks, phil. >> media taking a hit. we'll talk to aanalyst next. and markets continue to rise and fall... predictable is one thing you need in retirement to help protect what you've earned and ensure it lasts. introducing brighthouse financial. a new company established by metlife to specialize in annuities & life insurance. talk to your advisor about a brighter financial future.

welcome back to "squawk box." viacom just out with earnings, topping expectations for the quarter, profit, however, fell 60% from a year earlier on higher programming costs and lower ad sales. joining us is michael morris from guggenheim securities. you hear those numbers and you say is this a buy at this point? >> yeah. we are very focused on what we think is the early stage of a turn around at viacom under a new management team. under the prior management team, we felt they lost their way, the their program want reaching

their core udenaudience. there's a new management team and it's going to take some time to show results. >> this is all about the new ceo. what's the money moon period? at what point do you have to see results turn in your favor? >> i don't think it's a long honeymoon. this company needs to start rolling out new programming on mtv. the ratings have improved at a couple networks. nk loadion has soon improvement, only mtv and kpedy central. it not going to be a long honey moore period baes improvement in the linear story as opposed to digital? >> this has to go beyond just

linear. we think there's a clear expectation in the marketplace that they can't get anything right. so we see, you know, from a stock price perspective, we see low hanging fruit just by identifying and airing some programs that can get some ratings traction. but we stand the future of reaching consumers and making money in this industry, you have to be in front of them on multiple screamulti multiple screens and monetize appropriately. that will put them in a stronger position, whether it's on linear tv, whether it's on apps, whether it's on different mobile devises or formats. >> real quick, what's the potential up side and what's the down side in your mind? >> well, we see the up side, you know, we have a price target of $50. we could give you a blue sky case of $60 per share based on

improving what's going on at paramount, their film studio, has been losing money. we think if it even could perform at a profit level on the low end of peers, there's probably $5050, some improvement on the -- go worst case zmario? >> you go back to the mid -- when we had speculation in the marketplace they would recombine with cbs and there would be perhaps an evaluation event there. when that came off, the stock retraced down into the mid 30s. >> seems like a clear case of risk-reward is on the up side. michael, thank you. >> a.

>> joining us now be jan rogers. always good to see you. i would imagine directionally you agree with shorts, going against retail but you do like some and top on your list is best buy. why? >>. >> well, i have several on my list. they're the last man standing. they're doing a pretty good job of competing against the big beast out there of and zoj. because right now if you're not online, if you're not off price, off mall or if you're not local, you're having a really hard time competing. but there are people who can still compete in those spaces and i think that's a good example. also, if you look across the street from the mall, you see ross stores, burlington and alta. if your full price on-mall retailer they're the best retailers in the world.

walmart as dlat may include the players like that that have been the darlings and has now fbsed itself and has come out the other side of the ditch and is crawing up the hill given. i like them because i think strong brands -- i like that kind of vendor, strong brands. i like the vendor side of the space because i think they're more in control of their own fate than the intermediaries who are trying to sell their product. >> jan, great opinion will.

>> i'm going to tell you which businesses are getting in on the celebration. tomorrow on "squawk box." doesn't make, former yahoo! president susan becker and more, ♪ ♪ did you know slow internet can actually hold your business back? say goodbye to slow downloads, slow backups, slow everything. comcast business offers blazing fast and reliable internet that's over 6 times faster than slow internet from the phone company. say hello to internet speeds up to 250 mbps. and add phone and tv for only $34.90 more a month. call today. comcast business. built for business.

i'm a rainmaker. i make it rain. >> madoff securities is the world's largest ponzi scheme. >> that's what you get for believing in magic. >> we got a problem, bernie. >> lives are going to be destroyed with this thing. >> how much did you lose? >> $50 billion.

♪ ♪ >> this is really our crowd right here. >> coming up, our newsmaker of the morning, ceo randall stephenson will join us, including the $85 billion time warner deal. we'll look at u.s. equity futures, higher across the board. you're watching "squawk."

good morning, welcome back to "squawk box" right here on cnbc. among the stories that are front and center at this hour, cereal maker kellogg out, besting estimates at 7 cents, gave a full-year forecast that pfalls

largely above current consensus. and there are signs of a turn around going on in brazil, the second biggest market. better than expected first quarter sales were helped by an improved price mix as drinkers go for more expensive beers. job cuts fell 15% in april from the prior monday saying year-to-day job cuts were the lowestthe year. i don't know if you saw, arconik has now a so that just happened crossing the wires a little bit ago. >> we're about a half ament away from weekly jobless claims, also productivity and costs. also the trade deficit. the market is up above 40 points on the session. we've been positive most all day

long, europe has been positive. maybe it's a little bit of a sigh of relief that there was no real horrible moment for macron yesterday, just some funny moments maybe. got seven minutes to go. there's the 10-year. rick santelli standing by. give us the numbers, please. >> all right. let's start out with jobless claims, a pretty big drop. 19,000, from 257,000 to 238,000, 1.964 million on the continuing claims, 33.7 billion deficit, that's minus 43.7. that's aso somewhat lot rahal what i always think now is most important set of

productivity points, preliminary not a good number, down 0.6%. we were expecting a light negative. that's a bit more than the light lengths. from 1.3 to 1.8. on our last wook our first look at the last number was 1.7. now it 1.3. so 3% is pretty much a big deal. how did the market react to that little any nm some of the other

data points, especially our final read on durable good. the plim rip reads are like puzzles with. let's get over to steve looezman for the datait needs to be brought back up though you can average is in with al the reinvestigations there out there. what now is the odd for the june p prn. but that's where we are. it was around the low 60s, jumped up to 75%.

taking a look at the keys there to that is the statement the fed made about that wook be -- week. joe, a lot of interesting stuff to come here, the second hike of the year looks fairly baked in. there will be debate about whether or not they do that third hike or do they end up reducing the balance street instead of that third hike, joe? >> thanks, steve. we still need you. everything -- you know what term everybody uses now, like a fire

hose trying to take a drink from a fire hose with the news cycle. like yesterday it was, you know, it was a boss, which any other day that would have been the biggest thing in a week and instead there was health care and comey and today you got all this stuff going on. so we still need you but just doesn't feel quite as relevant -- >> joe, there ale is it or the roon nal. so people are still sort of misunderestimate being the fed on this. >> right. >> and peter's comments were key. he said they want a hike in june. >> you're going to misuse underestimate. i'm going to use refeudate. we're not refeudating your work. >> it's different now. i'm the one who's always wanted this to happen.

pass the ball, pass the buck to the fiscal side. we used to have a nice, pleasant job. i could be on the golf course with an official by 3:00 in the old days. not anymore now. >> those two things don't go together because casting and the golf swing are -- in fact, this next guest can comment on that. >> we got randal. we have so much to talk about. the new survey out this morning, more of what ceos are expecting. randall stephenson, at&t chairman and ceo, actually when you do that. >> as you know, joe, i'm the last person in america who ought to be giving golf eninstructions so let's move on. >> ceos should not be good golfers. >> i fit the bill.

i've succeeded. >> let's start because we're talking about business round table and talking about tax reform and then we'll talk to some of the or -- it's importan toxplain that it jus not a tax cut. it's a way to get hiring and a way to get jb. >> i think that's something you need to focus on -- we're inv t investi investing, corporate america is investing. you can go back to world war ii. those go hand in hand. if you can have a tax reduction of 35% down to to think it

wouldn't cost, it's none as soon as cawe would investment in the house that it's 3,000 additional jobs we have to put on to put that captain on the so these are high paying, really good jobs with great benefits. so the correlation is very be very fight. if squm so all of this fit to the. and lower taxes drives more investment, drives more hiring, drives great are wages. >> in the past you've been very strock would do if they tell you

they're not going to invest if something happens, they can actually make that happen, not hire people, not expand. if we got above zero on interest rates and we got some fiscal and transcat go and financial engineering for pr. >> of course. it's arithmetic, right? if you take the tax of the profits on the investment you make down, meaningfully, you will get more investment. er frrp regulation, it

effectively a cox pb we saw the opposite happen with title two, real stringent rules by the prior fss. t the. sffrmt it may n be what ceos do -- >> no, no, no, i think in randal's case, it's 100% true and accurate so i'm not disputing what randal is saying at all. the question is and in businesses like his that want to spend more on infrastructure and feel look they can't or they're being held back, this is a huge boone. the question is there are other types of businesses that you would imagine would wait for demand and the question is

whether you can get that full circle to rap. >> we all have a will the of prrn you drop the tax rates down as we're talking about doing here, there will be a step up in investment. if you go a step further, as chairman ryan, speaker ryan is suggesting, and allow immediately -- ability of investment. if america isn't invesing, nm or a gathering at a corner grocery store. >> while we have you here, let's talk about the deal and the

prospects of change. i would just say this, that president trump did campaign a certain way. i think there have been some differences in the type of governing yuriing that initial on session that he expressed to your deal, that may be less now and it more likely that can have it what they do to decide on andy trust issues or i've had no conversations directly. the deal is front of the department of justice. they'll do it. they're doing their so far

things look good. >> can we talk real briefly media stocks took a hit yesterday because of a real anxiety around cord cutting. what do you think is going on? >> it's a real surprise, people cutting the cord or never getting the cord, if you will. that's why we launched directv now. it's had a terrific amount of success. so, look, what's happened over the course of the last few years is content costs continue to escalate. they continue to go up and up and a lot of so they're opting identity of there see every googling, whether it's you'll low that's more directed toward pacific consumers at a lower price point, and a lo the coming

up to the prorty companies like yours in terms of net knew tramt no, we need congressional action. nobody argues whether the key provisions of net neutrality ought to be in place. there should be rules against blocking and throttling and so forth. those are really, really important to have. the fcc is in a quandary. they don't have really the authority they need to make those rules legitimate. so we need something out of congress to pass simple legislation that basically codifies this no throttling and so forth into law. and i think that is, there's

going to be years of lit gays around this. that's exactly what's playing out and that's exactly what's going to continue unless congress puts in place rules that make this very clear, who has the rules of authority. >> did you watch cnn at all? >> have you seen it lately, randal sp. >> of i was going to ask you about mark wahlberg. >> he's played in the at&t at publ beach today. >> i like the commercial. i do. i think that -- >> >> you don't even have to pay him probably.

>>ere. >> and when we return, president trump is giving boeing's faa team super hornet new life. we did see a dip below 47. in's ♪ it's been over 100 years since the first stock index was created, as a benchmark for average. yet a lot of people still build portfolios with strategies that just track the benchmarks. but investing isn't about achieving average. it's about achieving goals. and invesco believes doing that today requires the art and expertise of high-conviction investing. translation? why invest in average?

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the white house is set to vote on obamacare, a possible replacement today. in an op-ed on cnbc.com, tom price said obamacare is in what he calls a death spiral. good morning. >> good morning, andrew. well, speaker of the house paul ryan said he would not hold a vote until he has the vote. i do caution you it's already been pushed back once today. the turning point becomes when a number of prose cots.

sfwr now, in that op-ed published on cnbc.com, he said that staying the course is not a viable option, blauk is in flshl and they say it holds a hidden age tax because it could increase costs for older americans. we'll be following this story all day and keep you posd with the latest. >> thank youery much. elan miler. he's got a look inside boeing's 18-foot production line. good morning, morgan. >> good morning, melissa. this is is an aa-18, it is the jamming plane from the f-18 super hornes.

both players are made here in solution and boeing says it is ready to make more. for decades, the fighter family has dominated carrier decks. but with lockheed martin expecting to expecting to be operational next year, many speculated that the days could be numbered. enter president trump, spurring a pentagon review and in february saying he's looking at a quote, big order. now, that coming on the heels of years of take -- talks between boeing and the navy about the need to replace the fighter jets. and now the production is poised to double. >> today we're producing two ships per month, super hornets and growlers and as we think of the additional need of the airplanes we can see that going up to three or four per month by some time in the early '20s. >> the budget that's moving

through congress right now includes an allotment for 14 new super hornets and boying expects the navy to -- and boeing expects the navy to buy more trains through 2022. that will ensure the f/a-18's dominance well into the 2040s, but guys in focus whether the new plane orders are the traditional super hornets or a more advanced version. boeing makes the argument that the newer planes which cost about $3 million more would serve as a good complement to the f-35s and planes like this growler behind me. back over to you. >> all right, see you later, morgan. when we return, can apple ceo tim cook lift apple iphone out of the rut? we'll show you what he said to jim cramer coming up.

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we didn't grow in china. but we did remarkably better than we did over the second laugh of last year which is what we expected and it's what we delivered. and we feel that we'll do even better there this quarter. >> that was apple ceo tim cook speaking to jim cramer last night on "mad money." he joins us now from san

francisco. that was great to hear it there. i love your reaction. did you know for sure it hadn't been -- because i would be like, i hope this isn't the first anyone's hearing of it. because then it would -- you know, if he had already announced it, you didn't know about , you'd look bad. >> no, that was the first time. he was -- he knew i was going to press him on jobs. he knew that because apple had been part of the campaign promise. like what are they going to do for jobs, so when i pressed him which is kind of follow-up on what trump was saying, he revealed that. i was thrilled that he revealed that. i think he probably waited until i got out there because he did not do it on the conference call. i think that this was a very important initiative. >> yeah. what do you think like we were talking about -- well, a billion dollars to apple doesn't seem like a lot, but what do you think it could end up being? that's just the beginning, right? what would really, you know --

what would be commensurate with what apple is capable of doing if they were all in? 10 or 20? what do you think? go ahead. >> look, i think that they could build a lot here. he praised the austin facility. obviously there's parts of the new phone that we believe are going to be made here. not sure what that is. but in general, i think that the man is just saying, if you give us the tax reform, it sounds like a billion. look, we can borrow. most companies can't borrow. that's why it's really vital. but i think they can put more behind it once they see what comes of it. $1 billion, nobody else is doing anything. even though they have a lot of cash, i thought look, we're here, we're building a lot here. i thought it was one of the things that thprident should take notice and give him a call today. >> you know ticook, it was a few years ago -- over a year ago he e-mailed you about china. now china has been problematic. do you think that -- was that e-mail damage control or was it

totally forthcoming? >> no, that was two years ago when things were really flying and then there are obviously some cross currents there. they're not buying some of the older phones. i think that will change. >> all right, we have to run. see you in a couple of minutes. thanks. the power of the nasdaq market. the power of 100 of the world's top companies. the power of an etf. the power of qqq. the thinking we put in, clients get out.

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we want to thank melissa lee for hanging out with us today. you can see her a couple of times today. back here later today. becky quick will be in omaha tomorrow morning. make sure you join us tomorrow. >> six hours. >> "squawk on the street" starts right now. ♪ good thursday morning. welcome to "squawk on the street." i'm carl quintanilla with david faber at the new york stock exchange. a lot to get to with jim today including his sit down with tim cook last night. a big day on capitol hill today. expect the house vote on the health bill. france is up nearly 1% after the macron/le pen debate yesterday. in fact, watch a lot of the commodities, oil breaks 47. now the lowest since november