i'll be able to offer subscribers and i'll have ebooks. i think the world fields -- we need more leaders. we're in a leadership crisis. >> i agree. it's been great having you here. that does it for us today. join us tomorrow. right now, time for "squawk on the street." ♪ good thursday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer, who's getting off the phone. david faber at the new york stock exchange. futures under some mild pressure as earnings from retailers continue to show some weakness. political discord over comey remains a focus as the senate intelligence committee holds hearings later this morning. europe is pretty weak. bank of england pretty cautious today. oil climbs almost back to 48 after the best day of the year on those bullish inventories.

our road map begins with macy's down double digits on the earnings miss. shares of kohl's taking a hit. >> shares of snap also plunging more than 20% after its first public earnings report. didn't go too well. but we'll dig in on the quarter. >> fireworks expected on capitol hill later this morning. acting fbi director andrew mccabe will take the stand in place of james comey. but first, comps are below consensus, down 4.6 on the owned plus licensed basis. macy's says it expects the sales decline for the full year. this is nine straight quarters, jim, they have had comps in the red. >> yeah. i've got to distinguish macy's from kohl's here. i thought kohl's was a decent number. kohl's got better and better and better and they have lean inventories. macy's what can i say? they don't have it. they are the ones -- when you try to figure out who exactly is in the crosshairs of the moment,

i come back to macy's. i just feel like that the -- you could floor by floor. aisle by aisle and they're being challenged. and it is really the weakest model out there. target -- target may even have a better model than macy's. so this was jarring to me. >> why though, why? >> why? >> yeah, why their -- >> oh, because target is not in the mall. i like target. >> so you feel their placement in the mall makes them more susceptible? >> yeah. that's why i like kohl's a little more because it's in a strip mall. macy's in a prism. >> what happened to they had gotten religion, they were going to close aggressively stores. >> i mean, they had closed stores. 66. i think every one makes money, i do. >> yeah, we'll talk about this when we get to whole foods. in the end, they're making money. but they're not growing.

>> no. >> they're making money, but each store is being handicapped. i think that what they have is very much more amazonable than people realize. remember their biggest money being made is in their perfume. in that very expensive area, that is being co-oped by a lot of people. people know their size. and they don't -- they tend not to go. then i have to tell you, i have a bunch of pictures and i went to a bunch of macy's and they look bad. it's the red tag and the plastic hangers. it just looks like you're at a pipe rack store. if i want pipe rack, i will go to burlington or i'll go to ross. it just has a bad feel. macy's, i -- i felt like i do more shopping in macy's. i look at their stores all the time. and they just don't look good. >> any conversation about macy's does take us into that broader conversation about malls and mall traffic. something we have talked about many times. i do want to add though, guys, when you talk to the larger mall

operators, ones on a simon property group, or even general growth, they say traffic is really not down. but what they say seemingly is that people are pre -- are finding what they want on their phones, still going to get it at the mall. but they're not walking around. they're sort of going and leaving. but that the actual traffic is not down. >> very focused about whether they go. >> yes. >> that's true. >> if you can measure people's steps that would be down a lot. >> they go to get -- cbre was on last night. they own 10% of the businesses retail. if you're experienceal, if there's something exciting to do at the mall, you'll stay. macy's is one of the least exciting things i do. i force myself to go in because of this job. okay? literally. i mean, i have to go -- i have to take my wife and say we are going to macy's. and she goes, well, thank heavens you're not demanding i go to sears. i was thinking -- i can't do that. she's -- geez, i love her. i don't want to get divorced

over sears. >> speaking of sears, eddie lampert said they're ahead of jcpenney, ahead of target. all this bankruptcy talk is -- >> blame the media. blame the media. >> yeah. he blamed the media. >> i think you should tweet fake news about how -- >> eddie knows i would welcome him any time for a sit down interview to discuss all of these issues. >> right. you'd be cordial. >> i would be -- >> fair. >> without a doubt. >> what about the small stocks since i was on that topic. when you look at a simon property or a general growth or a -- or any of the three i happened to mention, but they're all down sharply. >> they're very well run. they tend to have as these stores go out, they have new stores that come in. and they can reconfigure the stores to be more experienceal so they're better. if you speak to federal realty which is shopping centers that's don wood, their numbers are incredibly good. so it's not like they're vai

cant -- vacant. but they're getting new kinds of tenants. >> right. it's changing. >> yes. >> of course if you look 30 years ago what was in the mall it's different then than it is now. >> people used to go to shop. that's now abhorrent. howard schultz has talked about -- even teavana, they're closing those, so the mall h has -- it's a hardship to people and the millennials, i mean, they figure out what the best price is. and bingo. they go to that place. or of course -- >> or go to amazon. >> been a lot of traffic numbers that look at the number of stores that a mall customer goes to. and it's dropped obviously. people go in, find their target and they're gone. >> i wish they'd find target. >> yeah. >> one of the things that i'd point out, i know that e.l.f. didn't have the numbers and the

one things that i don't have -- they don't have sephora. that's truly helped penney. i won't look for a big number from penney. they have a lot of problems. kohl's does not. they have a good balance sheet. kohl's has good dividend, the progresship of the quarter -- progression of the quarter for kohl's is very good. if they're in -- if they're in the right kind of mall, the same kind of mall that ross is in and that burlington and burlington is going to blow out the numbers. the only two who transcended is footlocker and children's place. >> margins were up at kohl's. they did say that the traffic was different in march and april. >> that's why that stock will be up today. the inventories were lean. they were helped by under armour if you want to get into the granular. >> i look for macy's to trade around $26 let's say is where it opens. >> okay. >> do i think okay, you know

what, they're bottoming things. at this point, you know, down 4.6. i have an opportunity here to buy this thing. maybe they do some things in real estate around the edges that could be helpful. and generally speaking, maybe this is the time or is it not? >> well, i think the problem is that it's the time for what? it's the time to cover your short. i mean, do you want to get long -- i mean, nordstrom will have a good number and then will guide down for the rest of the year. do you want -- why would -- when they report, what are you laughing about? >> because you said that so definitively. >> i know this. this is what i do. >> it's true. you hit the phones. >> i don't pull a favor, but that was very important, we'll get to another topic. in the end, unless you have a whole foods that the numbers are still bad but you have a janna, you need someone to say, that's it. i want that macy's store in her old square, i want that to be condos and i want now. >> how about making it into penn

station. >> turn it into the post office? >> yeah. >> figure something out for those poor commuters. my god. have the city buy it for $4 billion. >> we do want to cover snap in the a-block. first quarterly numbers since going public. the company misses on revenue. slower user growth, posts a net loss of $2.2 billion. evan spiegel talks about the user growth strategy in last night's conference call. >> as far as growth, we'll continue to focus on north america and europe where we can deliver if most value for the customers based on their devices in the network and longer term we believe that snapchat is for everyone. it's early days for us so we're focused on north america and europe first. >> so the user growth decelerates but engagement rises to 3 billion snaps a day. >> yeah. the problem is with the user growth -- the revenues, there were a lot of people talk about a billion. the fourth quarter would have to be so monster, i don't think

they can do it. i think that's the reason why -- the main reason why the stock is down. a lot of people -- >> we went into the ipo knowing that the growth rate was declining. we knew that the company was trying to focus people on this engagement metric. i feel like they -- i mean, we're listening to them. >> oh, man, i was going into the positive spin. >> i don't know if it's positive. >> no. maybe the stock shouldn't run up to where it was. based on what we knew going into this ipo. >> someone got this $1 billion number wrong. that's haunting them. just like that little ghost thing they use, it's haunting them. i believe when you look at the engagement 30 minutes is really great. that's the kind of thing if you're universal pictures you want to advertise fast and furious and dead, number 47. >> never die. but yes. >> fast and furious comes back to life. >> yeah. fast and furious, social security. >> yes. wow. fast and furious -- yes. autonomous cars.

>> yes. >> i do think this is one where catalysts can happen. they're just getting on android, right? and android is just starting. they have europe, they just hired a manager in germany. they have a lot of users. but here's my thinking. i'm against hazing. i think hazing is dangerous. hazing in college. but evan spiegel, he needs to be hazed. he needs to be hazed like i have never seen. you've got to put him through some sort of gauntlet because this guy is so arrogant. he's so arrogant that i mean, honestly, evan spiegel, listen to me and listen to me good. you're going to introduce your call the next time and then you're going to back off and let your cfo talk. you're going to say, you know what? i did not do the job i'd like to, but i'm going to work harder. and do not relate -- do not relate facebook to yahoo, okay? and do not make jokes about how we're infamously don't talk about new product. because you see you killed yourself.

now, he's cool as can be. >> evan thomas spiegel is not listening to you. he is not. he's not even listening to you right now. >> no, he is. no, he's listening to me. >> no. >> what do you think -- wait, what is he? is he in like th the -- is he i florence? my wife can talk to him there. >> you're referring to the answer to which an answer was given to greenfield of whether or not he was afraid of facebook and mark zuckerberg. >> people are going to copy your product if you make great stuff. i think we have seen this happen a lot in technology. you know, when google came along everyone really felt like they needed a search strategy. you know, when facebook came along, everyone felt like they needed a social strategy and with snap, with our company, we believe that everyone is going to deliver a camera strategy

just because yahoo has a search box doesn't mean they're google. >> interesting. just because yahoo has a search box doesn't mean they're going. mike santoli said this morning that shows his youthfulness. at one time, yahoo was as powerful -- >> you should read conrad because youth is a great short story. he's still in school. he's got an incomplete. >> incomplete. >> this was frightening. okay? because this would be like the cleveland browns are going to play the pats. and belichick is nothing. belichick is nothing. he basically said that belichick is nothing. >> zuckerberg didn't do that in his call? >> remember the first call he had a horrible call. >> i do remember that one. >> it was horrible. >> because he promised the world. >> he didn't have mobile, it was pathetic and sheryl talked about -- >> then they had the big call

that turned it all. >> yes, they did. that could still happen, but evan has to go to that carnegie, how to win friends and influence people. i'm just giving some advice. i mean, it's good if it's taken up. >> it should be if you respect your elders. >> humility is a fabulous thing. >> while we're talking speaking of social platforms, twitter is announcing a new partnership with the nfl. live programming where the league will produce a 30 minute live digital show, it will air five days a week during the regular season. >> trying to nail that down. got started there. yeah. i think that remember they lost the true nfl. >> didn't amazon pay 50 million bucks to stream five nfl games? >> that's nothing. that's a bargain. >> they're still on regular television. >> they could have bought the whole league. >> $50 million for five games just to stream them. >> i think that's fantastic. that was a deal. >> i think all of these deals only one beneficiary. >> yes.

>> the nfl. >> the nfl. >> when we come back, the president providing his own definition of trump onomics. we have the senate hearings, and the new acting fbi director will testify. the nasdaq is up five days. longest stretch since february. but for the most part, s&p and dow are slightly down for the week. e infamous traitor. e infamous traitor. and i know a thing or two about trading. so i trade with e*trade, where true traders trade on a trademarked trade platform that has all the... get off the computer traitor! i won't. (cannon sound) mobility is very important to me. that's why i use e*trade mobile. it's on all my mobile devices, so it suits my mobile lifestyle and it keeps my investments fully mobile... even when i'm on the move. sign up at etrade.com and get up to six hundred dollars. the power of a low volatility investing approach. the power of smart beta. power your client's portfolio

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bund. in about an hour from now, acting fbi director andrew mccabe set to testify at the senate intelligence hearing two days after the president fired comey. our kayla tausche has more. >> good morning. this an annual hearing that since 2015 at least parts of which have been public and have been open sessions for this committee. but this time there's an elephant in the room and that is the firing of former fbi director james comey earlier this week. and the timing of which occurred during ongoing investigations into russian interference into the u.s. intelligence and back channels by the trump associates. those investigations are happening at this particular senate committee. it's a bipartisan committee and there was bipartisan concern after that firing on either the

rationale or the timing of that firing. given everything else that's going on. in have been some developments -- there have been some developments on that investigation in the background this week. for instance, the committee has requested documents from treasuries money laundering unit and two democrats individual is a if treasury doesn't produce the documents they're going to hold up president trump's nominee to lead that division. and then a subpoena sent yesterday to mike flynn in the face of his refusal to cooperate with the request for documents that the committee had made. they had previously said a subpoena was a last resort and they have gone there because general flynn has been requesting immunity and they did not want to grant that. what does this mean for what congress can get done and the white house is seeing as legislative victories this summer? well, the russian inquiries they'll take up a lot of oxygen from congress. whatever is left over, they have to put toward some 12 appropriations bills that don't really have much republican

consensus at present. you have a september 30th funding deadline for the government. then you have the potential for democrats to provide big opposition. that's what they want to do and it's not going to be that difficult. we don't see any big victories for trump this summer. so far as this hearing, carl, it begins at 10:00 a.m. there will be open remarks from the democratic and the republican chair and from the witnesses the director of national intelligence dan coats is going to speak on their behalf. so you won't hear from the acting fbi director until he gets questioned by the members of the committee. we'll see which direction they choose to go in. >> we'll come back to you for that. our kayla tausche on capitol hill. we'll get cramer's "mad dash." more "squawk on the street" coming up from the nyse straight ahead. what powers the digital world. communication.

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a lot to watch this morning. snap earnings from last night and then the slew of retailer earnings that we have gotten this morning. we'll watch senate intelligence later today and get the opening bell in a couple of minutes.

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a new company established by metlife to specialize in annuities & life insurance. talk to your advisor about a brighter financial future. the opening bell is brought to you by brighthouse financial. established by metlife. >> all right. we're count down to the opening bell with about four minutes to go. whole foods may be a feature. late yesterday we got a series of announcements from the company, jim, in terms of an away -- in a way responding to shareholder unrest but not completely responding to the causes of the unrest, although they do in their words refresh the board. >> well, affinity program, terrific. cost cuts, fabulous. big boost in the dividend, amazing. all sorts of new board members including ken hicks from footlocker. ron shaich from panera. a new cfo from the exacting

kohl's crew. still want -- extraordinary. highest sales per square foot of any retailer. comp stores down 2.8, huh? i mean, honestly, that's -- that is just awful. so what happened is that this is going to make janna put more pressure. they didn't have good relations with janna. they slagged janna on the conference call. >> i know. i tried to get ahold of janna and its founder, barry rosenstein, to no avail. unfortunately. but in is a belief, jim, that there are buyers for this company, at least amongst those large shareholders that include janna. i don't know if it's true or not. >> i think it is. >> i don't know if they're hall last nating or -- hallucinating but they want them to engage with the buyer. >> i think the sales per square

foot is amazing. i think they have a layer of people that would just be -- they have all these -- >> kroger, i mean, amazon -- is that real possible, come on, no. >> amazon, that's not the style, but kroger, yes. i mean, one of the things they talked about that was kind of absurd was that they said, listen, we're going to raise the dividend because we want a 2% yield. they didn't get need to get a 2% yield by raising the dividend. they could have done it by having the stock go down. >> you see any analogs between facebook co-oping snapchat's niche product and whole foods co-oping the niche product? >> well, the affinity will matter. they generate a huge amount of cash and they have this kind of sacrosanct regional and national -- they have like many layers of management. and it was -- it was experienceal to shop there. now it's kind of okay.

they fell behind. they should have brought salesforce.com in a long time ago to figure out what the customers want. i think it could be easily in play. not anything they said last night, although this board of directors is highly independent. i mean, ron shaich, you can't own those guys. those guys can not be bought. so if there's a bid that comes, it's going to be -- i think they're going to take it. >> well, you point out the most important dynamic which is this does not seem to have satisfied the activist shareholders. by the way, it's not just janna, but new berger has been screaming and yelling to a certain extent. maybe not in letters. well, actually in letters too. sending them -- >> it's a buy because i think that it's -- it could be a win-win. that they are going to get comp numbers up. but they won't get them up until 2020. that's a long time to wait. but a lot of cash flow. there's a lot of fact. okay? >> let's get to the opening bell here and the s&p at the bottom

of your screen. busy morning on the macro front too. claims come in at 236. new 28 year low. 100 plus weeks below 300. the headline, 2.5, the estimate 2.2. so wholesale inflation making its mark today. >> i think that this is is a clarion call set of numbers to buy the banks. i know that the interest rates aren't up enough versus where they should be. but the banks are where you would go based on the two different numbers. let's throw in oil and you can buy the banks. i think that those are good. remember, retails case by case. some retailers are good. some are bad. but this oil move i think is surprising people. and it's got some adherence because we have been through the two inventory numbers that matter. so banks are the place to. >> by the way ringing the bell is kkr, celebrating a recent ipo. a fleck, a provider of concept

design and sketch to scale -- i think. >> that's the reason you could have nike personalization. personalization being a big theme running through a lot of what's still working in retail. you have your own. >> okay. >> personalization we hear about it a lot. not just in retail. remember iger talked about it on the disney call yesterday in terms of what you could see from the espn like product -- branded product. >> that stock doesn't do that poorly. i would love to know how you feel about it versus fox. >> well, fox actually did not have a bad quarter. >> no. >> the reviews are generally positive. certainly seemed to encourage a number of the analysts who follow the company. and what you're getting is more or less an inline kind of sense. you can see the stock is up. all the stocks that jim referenced had been pummelled on the overall concern about both the advertising environment, coupled with what we saw this significant increase in cord cutting that took place during the first quarter and maybe

continuing as we move into the second quarter as well. but in terms of fox, you know, again, not a bad quarter. other than nat geo in terms of advertising, also they showed some decent strength. >> yes. >> on the call itself, they didn't really get into answering many specific questions about the fox channel -- fox news channel and the changes there. >> but -- >> other to say they're keeping their brand, they're keeping the audience. >> their international orientation is really good and it makes you feel a lot better. i don't know if they just discovered the cord. when i go back over to disney call, i thought iger was candid in the strategy but the thing that dares me is the no cord. >> cord nevers. >> cord nevers. i mean, that has just -- boy, that's what the kids -- they're cord nevers. >> it's a really good point. if you look at -- if you could calculate in household creation,

q1 had actual creation which is usually a soft quarter. >> yes. >> moffett's estimate was that 6 million homes have either cut, shaved or nevered the cord. >> when you talk to your kids about tv, i'm just saying, my daughter bought a tv. i want to watch the games on it. oh, just watch it on your handheld. cord never. cord never. >> if you are starting a house hold now, the chances are you're not going to have a video subscription. >> how is that possible? >> because you don't need one. >> what -- >> it's not part of your experience. >> because you're so busy playing call of duty, world war ii and battle front ii? >> you're going to have a netflix and an amazon subscription, you can watch the nfl games if you want. that's it. maybe an hbo subscription. >> bernstein said yesterday, not everybody likes sports. a percentage has been paying for sports for years and never watched. got to strip that out. >> look, it's a new world.

it's a new world. i mean, like -- it's brave new world. i'm hopeless. i have cable and i have -- i have cable every house. >> you know, it's time for that to change. >> cable bill -- it's bigger than my mortgage. >> you're wasting a lot of money, you really are. but then we can talk about the different residences and waste -- >> yeah. 1500 count -- >> at least he wears them. >> this is a 200 count. it's like milk. >> it's like having brie joni suits you never wear. >> they make me look happy. i have to get them taken in. i used to be heavier. >> i wanted to get to telecom, to straight path. that incredible story that came out of nowhere. where one day we woke up and found out about a company most people had never heard of that essentially owns all of this 39 gigahertz and the spectrum licenses they bought years ago

and under the fcc rules they had to put to work. they weren't making it work, they were putting up fake cell sites. cardboard cell sites. >> honestly? >> yeah, it's true. anyway, the fcc said you can't do that. we're fining you. they said, fine, we'll just sell it. at&t came along and said we'll pay 95 and then verizon said we'll pay more. and then at&t said we'll match that -- 184. that's where we ended up. 184, verizon gets it at $184 a share. sold to you. stock that was 34 bucks in april. in april. >> well, there was a short on it. that had an aggressive short call saying it was like cardboard boxes. >> and that may have been the case. but they -- i guess they didn't quite understand the value of the licenses. >> for whom the bell tolls the

short sellers. >> yeah. howard jonas is the big winner here. the founder of the company. maybe a billionaire. now a multibillionaire it would seem with this deal. verizon comes out on top over that brief but very intense battle with at&t. >> that's something. >> we have some research to get to too. b of a is up on caterpillar. >> i love that call, talking about mining being good. going to the high in the consen -- above the consensus. really laying out a multiyear story. talking about having the first being analyst meeting in four years. people should get that report. i think it can really resonate with those who are shorted. it makes no sense to short it, because it finally on a p/e multiple, not expensive. >> the only one doing better is merck which had good news on

chemo. >> a humble man, he'll be on later today. fantastic work. i think the stock should be up more because this will be a $9 billion drug in five years. it's a remarkable drug. it keeps solving all the different forms. never want to get ahead of yourself because people have cancer, you never want to hear on tv that this is a cure all. but these are very good results. remember, this is -- everything that goes up there is bad for bristol-myers. bad. >> finally, macy's, got below 26 in the premarket. hasn't been below there in the regular session in six years. >> rather amazing. >> almost six years. >> it's just rather -- i mean, they don't have it. meanwhile, kohl's is finally getting the respect it deserves. it's up for the day. there's differentiation in retail. that's what starting to happen. it's not all losers. >> and macy's is going to take

along with it nordstrom. ralph. coors is down today. simon property and ggp, a couple of the mall names we mentioned a few moments ago. >> we have to get some time with macy's to get them to change the look of the stores. it looks too -- you don't feel like spending a lot of money there. >> bloomingdale's also? they have so many skus there. >> so labor intensive to refold all the shirts. >> it's plastic hangers, it looks so shlumpy. you know, e com means you're going up against amazon. >> nordstrom is going to beat but lower. >> beat and go lower. >> got it.

>> that's what they're going to. >> what's the stock going to do? >> it will go up on the short squeeze. and then it will end up being down -- >> got it. >> it's so easy. >> what day is that going to be? so i can sleep in. >> it will be tomorrow. you know, look, david, people will take up penney. mistakenly. then they'll hear that the comp stores are a little bit better. but nordstrom's, they're close. that's what's going to happen. is that okay? >> nordstrom is done -- >> the phillies are going to lose. >> they are? >> did you -- did you do back to the future? >> the phillies will lose anyway. you don't need a weather man to tell you which way the wind will blow. >> he does his work, everybody. he's not just guessing. >> this is what i think will happen. >> he does enormous amounts of work. >> the dow is down 33. let's get to bob pisani. >> a mixed market. good morning, happy thursday, carl. it's nice to see energy back a

little bit. believe me after weeks and weeks of lagging and oil at 45 and a lot of worries that it was going to 40 really fast. it's turned around this week. health care, sort of mixed open. kind of disappointing the banks were down because ten year yields moved up a little bit on the headline producer, price index. nice to be a little bit of a inflation, coming back. speaking of inflation, oil. commodities looking a little better. d.o.e. oil inventory -- oil is coming back. what a roller coaster it's been. $54, we go back to $45, then we go back to $54 and then back to $45 or $48. we're all floating around here. the question is where's the real number, we don't know. but moving towards $50 is certainly a lot better news for the oil companies. they're all up this week. all up today. marathon's probably up 4 or 5% so far this week.

exxon's up fractionally. i know marathon is definitely up 4 or 5% on the week. it's nice to see them turn around. the estimates are still coming down for oil companies. so if you look for the second quarter for exxon here's a good example. january 1st was $1.27. today it's $1.16. but if oil moves back to 50, $52 that may change a little bit. as you can see, we just don't know what side of $50 oil is going to be on. until the numbers keep moving around. the guys talked about the retailers this morning. i think it's important for everyone to keep track of the general trend. the retail comps, macy's of course worse than kohl's. but still can trend down for all of these right now. the guidance, the good news is that macy affirmed the whole year guidance. kohl's didn't give an update so keeping the numbers for the full year on them. it was encouraging to hear the ceo of kohl's talk about february week and overall march and april turning around.

we're encouraged by the significant improvement in march and april. that's very encouraging. after a weak february start to the first quarter. you see the retailers down overall i think the trend here lack luster. kohl's is better. traffic is generally weaker and march and april are generally improving. that's the good news. we'll see jc penney and nordstrom after the close today. back to you. >> thank you. let's check in with rick santelli at the cme. hey, rick. >> sometimes the word melt is used for lower. we could use the word melt for the treasuries except you have to look at prices. they're melting down because yields are creeping higher. look at a year to date of two year. remember, here we are at 1.36. we settled the year at 1.19. the only thing between us let's look at the next chart and an eight year chart, the only thing between us and comping back eight years in terms of the last

time two year note yields were here is basically 1.5 basis points. right now from this 1.36 level. if you look at fives, they close here 1.93. at 1.94. lower in price, higher on yield. let's look at year to date of tens, trading around 242. 244, we're getting close to unchanged. 30 year bonds year to date they settle at 3.07. we're at 3.05, you see where i'm going with this. here's something shocking. maybe one good reason anybody who uses percentages when they talk about yields ought to recalculate, recalculate. we settle the 21 basis points in the bund currently trading 33 basis points, more than double, okay? we're doing a slow creep, up to 100. not to mention that it settled at 102.20 so still down over 2%. finally, just to point out we

had a pretty crummy three year note auction on tuesday. pretty crummy ten year note auction, today is the chance for the 30 year to see if it can break out and do better. find some sponsorship. we'll be looking at a 30 year, quite important actually. i think it shows that parts of these moves are in an exodus of longs when it looked like we'd make a bee line back to 2% that didn't materialize. back to you. >> thank you very much. still to come, is the reality of washington becoming stranger than fiction? we'll talk to frank rich, one of the executive producers of "veep" on hbo. we're back after a break. think again.

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the latest installment of our digital series binge. frank rich producer of the hbo show "veep" is a long time political commentator and he knows politics from the real life and fiction side of things. listen to the post election soul searching that the cast of "veep" went through. >> on election night as the returns were coming in, we were shooting a scene in the republic of georgia, also known as pasadena, california. >> you fooled me. >> salinas sort of pursuing the jimmy carter role, she's sent to supervise an obviously corrupt election. an election so corrupt that two of her aides end up voting her in without intending to and then the returns are coming in. because we're shooting into the evening, as is very unsettling. ultimately, in fact, although it was fine, we reshot some of that

episode. >> because of cast reactions to the returns? >> no, just the whole thing felt discombobulated. i think it found a weak moment for us. maybe it would have happened anyway. you know, i think in the days that followed that, a lot of conversations, actors talking to writers. you know, producers like me talking to actors and writers, just trying to reorient ourselves and say, should we go on doing what we're doing, exactly what we're doing? we decided to do so, but it was something we talked about. gee, maybe we should throw everything up in the air. but we didn't consider that very long. >> you mean bust up the story arc because of what had just happened. >> yeah. not just bust up the story arc, it never got that specific. but to think about -- it was almost more existential. can we be funny? it was at that level. it reminded me after 9/11 that famous moment where "snl" decided it could be funny again. given permission by that great

laugh riot rudy giuliani. but there was a little bit of that kind of more philosophical conversation. oh, now we'll rewrite episode five, it wasn't that at all. but it was trying to be good with ourselves. feel good about what we were doing. in the end we felt sort of determined to go back to work and make a good time of it. >> interestingly the show goes through pains to say it's not modeled after either party. they don't allow real politics on the show but it's thrown a lot of people in turmoil. >> he's a great critic, a brilliant man. he went to college, he sent people reviews and people couldn't believe he was a college student because he wrote the best -- one of the smartest people on earth. it will be fantastic. one of the smartest people on earth. amazing. >> he's a good one. >> that season -- >> i'm only a couple in. so he already -- he kind of, you know, took a little thunder away

in me for coming episodes. i'm only a couple in. >> we'll get "stop trading" with jim in a couple of moments. oil is now down 78 points. don't go away. in july of '98. i did active duty 11 years. and two in the reserves. our 18 year old was in an accident. when i call usaa it was that voice asking me, "is your daughter ok?" that's where i felt relief. it actually helped to know that somebody else cared and wanted make sure that i was okay. that was really great. we're the rivera family, and we will be with usaa for life. usaa. we know what it means to serve. call today to talk about your insurance needs.

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♪ time for cramer and "stop trading." >> let's talk about yelp. citi goes neutral to buy them. there's a good article in the deal magazine that says this could attract insurgents, activists. it would be a great match for home adviser because that's a company that's a vehicle to be buying these things. i don't think stoppelman wants to sell, nor does mackie at whole foods. we don't know about that. then yesterday, there was a big meeting, microsoft meeting. amy hood who is really solid, the cfo said some things about margins that would not that great. amy is very rigorous, she doesn't hype anything. if you take them at their word, that's a mistake. she is giving you enough room so

microsoft will have a good quarter. they're dock some very good the -- they're doing some good things there. i like what satya nadella is doing. a tough guy. like at facebook, you don't think they're tough guys. >> i mean, but the stock went up 34% this year. when you look at the accretion of value over the mega cap companies it is stunning. apple, amazon, facebook, microsoft. >> and then if they got the repatriation, holy cow. so microsoft is a juggernaut. i would not sell the stock on that. it would be a big mistake. >> you're still counting on repatriation. >> i think there's the one -- i think that's the one thing they'll get through. i think repatriation will happen. i think that's bone that they throw. >> does that mean you have written off everything else? >> yeah. >> i'm not kidding. really? >> yeah? >> look, i just think we're -- look, i read the failing newspaper that's the times. it just doesn't read good. i mean, there's going to be -- look they have a couple of republicans who want to look into it so it makes so it's a long, hot summer and tax code is going to be very hard.

so maybe they do repatriation. because remember bush got that. >> yeah, listen, you're not alone in that view. there are plenty of people who look at the calendar, look at the progress or lack thereof and wonder -- and tax reform and the complexity of it and say that's what you end up with. you end -- maybe a cut of some kind and a repatriation. >> but that's what i'm thinking. i have lower mid expectations. >> what are you doing tonight? >> i have zebra which put up a couple of good orders. and then amn, they don't give enough credit. and paul polman, i joined the dollar shave club. david, i'm a booking machine. what do you think i do, when i get the calls, do you think that's idle chatter with my wife? who doesn't watch my show? my dogs watch my show. >> it's a simulation. >> that's elon musk. how -- >> paul polman, i want to hear what he has to say.

did he give them the greenlight or the red light when kraft heinz came calling? >> they come up with dubin dollar shave club. >> he was once an intern at msnbc. look at what you can do in life. >> was he? i think dubin and spiegel should get together. like a meeting of the minds there. >> jim, we'll see you tonight. when we come back the acting fbi director set to testify before senate intelligence. and fallout from the president's firing of jim comey. dow's down 132. retail is having a tough morning. macy's down almost 11%. back in a minute. e big city? i don't miss much... definitely not the traffic. excuse me, doctor... the genomic data came in. thank you. you can do that kind of analysis? yeah, watson. i can quickly analyze millions of clinical and scientific reports to help you tailor treatment options for the patient's genomic profile. you can do that? even way out here?

yes. even way out here.

good morning. the senate intelligence committee holding a hearing on worldwide threats set to testify among others, new acting fbi director andrew mccabe. comes less than two days after the president fires jim comey. we'll take you to the hearing as soon as q&a begins. the president signed an executive order on voter fraud. good morning. welcome back to "squawk on the street." i'm carl quintanilla with sara eisen and david faber. the dow is down 122 largely on some weakness out of retail

earnings that we got today. the senate intelligence committee hearing getting under way. acting fbi director mccabe set to testify before congress for the first time in his role just days after the president fired james comey. kayla tausche has more. >> it's an annual hearing in which the leaders appear before the senate intelligence committee and at least a partially public hearing where they discuss worldwide threats. threats from outside the u.s. that could imperil the safety and security of this country. but of course the conversation could take a different turn today, especially because just yesterday the at ten -- attendee list swapped out james comey and put in andrew mccabe. he'll be questioned and a bit of a background on mccabe.

he's a veteran of the fbi, he's been there 20 years. his experience on espionage and comey when he elevated him to deputy director referred to him as andy colloquially. he has a good reputation in the bureau. but this is his first public appearance. in prior years, this specific hearing has covered everything from cyber security to human trafficking to state actors and we'll see exactly what the testimony of these intelligence leaders contains in it in a few minutes. carl? >> got a whole lot more interesting over the last 24, 48 hours. thank you. we'll of course take you there thrive as soon as the q&a starts. and president trump is set to sign an executive order on voter fraud. our eamon javers has more on what we can expect there. good morning. >> yeah, good morning. we began at the white house with no public events on the president's schedule today. absolutely nothing where we were going to see him and then just now the white house is saying

that he's in fact going to sign an executive order. we don't know when that will be. we don't know if we'll see him on camera or have a chance to ask him questions about the firing of the fbi director at that event. here's what the white house is telling us about what's in this executive order. they are saying that this is going to be more forward looking than just going back and reviewing alleged voter fraud and suppression. they say this commission they're going to announce today is going to review policies and practices that enhance or undermine the public's confidence, in improper voting, fraudulent voting, and voting suppression. so this reflects very much the personal preferences of this president of the united states. he does not want to focus on the russia investigation. he does not think that requires investigation at all. what he thinks requires investigation in this country is voter fraud. earlier this year when the president raised this issue and talked about doing an executive order on it, critics say that

the president was calling into question the legitimacy of an election he won back in 2016 which is hardly standard political practice. nonetheless, this white house very focused on this idea of voter fraud. how to stamp it out and how to prevent it going forward. >> eamon javers, going to be a busy day both at the white house and the hill. thank you. let's get to snap this morning. the shares on i what getting hurt. the parent company of snapchat plunging after they released the first earnings report after first going public. julia boorstin has more on that. >> well, evan spiegel has laughed off the question about competition from facebook. successfully copying the most popular features but analysts are not so convinced. moffett nathanson lowered it to $11 advocating sell. and needham reiterated the underperform rating calling the results disappointing, saying there are quote several business model problems.

but some analysts see the sell-off as an opportunity. cantor fitzgerald upgraded it to neutral. it targeted hard to reach 18 to 34-year-olds. oppenheimer upgrading to outperform. saying snap's well positioned to take advantage of advertising shifts to mobile. and mch with the $25 price target on the stock says shares overcorrected and getting advertisers and agencies more comfortable with the platform should help deepen wallet share. evan spiegel and cofounder murphy both lost over $1 billion from the stock drop just in the past couple of hours. guys, back over to you. >> all right. that hurts. julia, thank you. stocks broadly are dropping in early trading here. not as much as snap, but also got some retailers under pressure, like macy's. potential impact from the unexpected firing of comey this week. certainly in focus amid growing

concern on how it can slow the trump agenda in congress. for more we're joined by david rosenberg chief strategist and economist. welcome back to "squawk on the street" and mike santoli, senior markets commentator. does snap do anything, mike, to ruin the narrative about technology in the amazing outperformance of the nasdaq, 18% since the election? >> i think it disturbs the big five of the nasdaq. really what's powering it ahead. i think coming into this week earnings did pretty much all they could do to reassure investors that basically the profit rebound is intact. so anything you got this week was more likely to detract from that view. so disney a little bit ragged and all the rest. i don't think it's a big mover right there, but along with macy's where the consumer side had bounced really hard, a lot of the stocks had a good few days. now you have another reminder that things are tough there. so not saying snap is helping things today, but i don't think that's the big swing. >> david, we're looking at all s&p groups now lower today. this is a broad based sell-off.

haven't seen that in a while. yesterday, we were trying to figure out if there was a market implication from the firing of james comey and the fallout from that. whether that would delay the trump agenda and the promised tax cuts. do you think that's a cause of the selling today? >> well, it could be partially the result. i mean, there's no question this is not an earnings driven bounce in the market in the past six moms but multiple driven. but parent of -- but part of that is we'd get deregulation and the tax cuts are also part of that. but also you had the atlanta fed take a really big slice out of its second quarter gdp forecast. it went from 4.2 to 3.6. 3.6 is still a high number. but i think at the same time if they continue to reduce their second quarter estimates it's going to call in question whether or not this pervasive view that the first quarter

weakness in the economy was strictly just seasonal mall adjustment and that could get some second-guessing as well. >> david, yeah. people are getting used to this atlanta fed starting high and working their way lower and lower. your main take over the past few months has not been that we're all betting heavily on policy, but just that we're rolling over on a bunch of important metrics in a classic late cycle fashion, right? >> right. we got another classic late cycle metric on friday with the 4.4% unemployment rate. i think behind all of this message of fiscal stimulus which, you know, keeping in mind after eight years of expansion and so many late cycle measures, the elephant in the room and i have been seeing this for a while is not necessarily the fiscal policy stimulus out of washington that for the here and now has people excited. it's the fed's reaction function. you are seeing increasingly with the labor market as tight as it is that the fed is getting concerned that it's behind the

proverbial curve. you hear people like eric rosengren is one of the most ardent hawks on the fomc so the risk is whether or not we see if fiscal stimulus. if we do that, the fed will do that much more. when the fed starts to raise rates and flatten the yield curve after eight years recession is not that far -- out of the investment horizon. i'm not saying it's around the corner, but what the fed is doing is far more important than what we see, you know, out of washington in terms of fiscal policy. >> i'm just looking at the sell-off, mike. picking up steam. you have 1% moves lower for groups like consumer discretionary, real estate, almost for financials now. >> yeah. you have had a lot of energy expended by the market to kind of hang around by the highs. 's sort of glare -- it's sort of glaring that the s&p 500 could not just carry ahead above the highs. i think it means -- i think we had an incomplete pull back in

march. went down 3% for five seconds and then you rebound for the highs. we didn't come barrelling up with a lot of momentum. i think it takes multiple things to keep people interested in buying at those levels. one of them is whatever distant hope of policy progress. that's one. as i said earnings did what they could. credit markets are holding together great. no not giving you a reason to worry about the big downside. >> david, one thing that's getting more conversation today,ppi, to what degree the wages will come under pressure. how much are we talking about that over the summer? >> well, i mean, i look at the ppi number in the context of what was a very weak print in march and frankly i don't think there's a lot of sustainability to inflation. look, we'll get the odd monthly report. that's going to be a little

strong. today's ppi number certainly was. when you look at the stability in the u.s. dollar, you look at what the commodity prices have been doing which is falling. it is hard to build a big inflationary story. if there's margin pressure we will see it in the wages. but the evidence there is still pretty mixed. the one thing i'll say, nobody talks about it is the fed loan officers survey that came out for the second quarter and the facts that the banks eased the lending requirements. when you look at the demand for credit indicators out of the fed in the is second quarter across a broad array, commercial real estate, mortgages, credit cards and auto loans, the demand for credit in the household and business sector is actually contracting. again, when you're talking about late cycle, moving towards balance sheet repair, that's another classic signal but helps to explain perhaps why the retailing stocks aren't doing so well right now. if households are hunkering down

and going into another era of frugality by paying down debt it's good news for savings but not for spending. >> leff coe vits said it was good news for what it was showing in terms of consumer loans. >> as a leading indicator, yeah. >> but the thing is that it's -- you have to look at the report wholistically. i was watching when tobias was on. we're very good friends but there's the whole report and the banks fractionally eased their lending guidelines for cni credit. mean while, the demand -- i mean, you can take the horse to water, but is the horse going to drink? when you look at the demand indicators because it's a full report. not one line on cni loans and especially autos, credit cards, residential mortgages. the diffusion index was contractary. that's not normal and again, it's a classic late cycle development.

>> we will see if your consumer thesis plays out. we'll get more earnings next week. thank you for weighing in here on the markets and the economy. david rosenberg and mike santoli. as we head to a quick break we're showing you a live shot of the senate intelligence hearing. of course we'll take you there as soon as it begins. plus, we'll hear from a former deputy assistant attorney general and a former fbi assistant director to talk about what we can expect to hear. "squawk on the street" will be right back with the dow down 17. stay with me, mr. parker. when a critical patient is far from the hospital, the hospital must come to the patient. stay with me, mr. parker. the at&t network is helping first responders connect with medical teams in near real time... stay with me, mr. parker. ...saving time when it matters most. stay with me, mrs. parker. that's the power of and.

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we are watching this hearing at senate intelligence. let's take a quick listen. >> we anticipated asking director comey a series of questions about his actions in -- and the actions of the fbi in terms of looking into which donald trump associates if any and some of their actions during the campaign as it relates to the russians. however, president trump's actions this week cost us an opportunity to get at the truth, at least for today. you may wonder a little bit how seriously i know the white house continues to dismiss this investigation. i point out for the record the front page of "the new york times" which shows a picture of clearly the administration that doesn't take this investigation too seriously. it is important to restate the

critical importance of protecting the independence and integrity of federal law enforcement. this is central to maintaining the confidence of the american people in principle that all americans, no matter how powerful or accountable before the law. the president's actions have the potential to undermine that confidence and that should be deeply concerning, no matter which political party you belong to. this week's remarkable developments make our committee's investigation into russia's influence on the 2016 u.s. presidential election even more important. and while it is clear to me now more than ever that an independent special counsel must be appointed, make no mistake. our committee will get to the bottom of what happened during the 2016 presidential election. and again, i want to compliment the chairman on his work in this effort. we will not be deferred from getting to the truth. these actions will do nothing to

undermine our resolve to follow the evidence wherever it leads. we hope to speak to mr. comey and we'll speak to anyone and everyone that has something to offer in this investigate. and mr. mccabe, i didn't necessarily expect to see you here today. we don't know how long you'll be acting fbi director. but while i will adhere to what the chairman has indicated in terms of the line of questioning, i will want to make sure my first question for you, even in this public setting or will be for you to assure the committee that if you come under any political influence from the white house or others, to squash this investigation or impede it in any way that you'll let the committee know. this investigation has had its ups and downs. and again, some including myself sometimes have been frustrated with the pace. we will no doubt face other exams in the future. but ups and downs and bumps sometimes is how bipartisanship works. it's a constant struggle but one worth making and i'm proud how

members of this committee from both sides of the aisle have conducted themselves in one of the most challenging, political environments we have ever seen. the same time, chairman byrd and i have put this on a solid bipartisan footing with the shared goal of getting to the truth. in spite of the events of the last 24 hours i intend to maintain our committee's focus on the investigation. indeed, the recent actions only increase the burden of responsibility on all of us to ensure that we live up to this challenge and to uncover the truth wherever that leads. there is obviously consensus agreement among the u.s. intelligence community that russia massively intervened in the 2016 presidential elections. nor do i imagine that any member of this committee was surprised to see the exact same russian playbook just being run during the french elections that just took place last weekend. and no one should forget back in mid 2015 director coates, i had

some -- there was a hacking into the german and they should it directed at their officials with their elections in september. in short russia's direct interference around the globe is a direct assault that we must work on together and it's clearly one of the top worldwide threats. that being said, gentlemen, i want to start again by thanking you for your service to the nation. i want to particularly note that director coates who is testifying in the first time since his confirmation. i -- >> we'll take a moment here as we await q&a to begin. let's -- with the fbi acting director mccabe. joining us this morning is chris shwicker and mr. dupree. thank you for joining us. >> good morning. >> good morning.

>> tom, you heard warner there repeating his call for a special prosecutor calling the timing of comey's dismissal especially troubling. how much do you think we think -- how much do we think he and burr are on the same page? >> there's a good deal of bipartisanship here. i think all the senators are united in saying that we want to have an independent investigation that gets to the bottom of this. one way or the other. i suspect that if we are looking for points of disagreement it may come over the need for a special counsel. we have heard a lot of the democrats very aggressively calling for the an intd -- appointment of a special counsel and most of the republicans are resisting that. if there's a point of departure i suspect it will come over the question of the special counsel. >> chris, how do you think that gets resolved? >> well, i think the attorney general and the white house have the final say in that. particularly the attorney general or the deputy attorney general in this case if there's -- since sessions is recused.

but let me say something about special prosecutors. we have seen it in the past. i have lived through it. you end up using the very same investigators. you have someone different at the top, but there's an incentive to drag those investigations on and spend a lot of money and bog down and you end up in the same place and when there's a parallel congressional investigation the water gets muddied very quickly because you're stepping on criminal witnesses. getting them to issue -- not duplicate statements but statements that can be often be inconsistent and that hurts you when you get into the prosecution. so it doesn't do a whole lot of good to have people -- multiple parties interviewing the same witnesses and looking at the same evidence. >> yeah, tom, it's a good reminder that yes, the fbi has this ongoing investigation into the trump campaign's ties to russian operatives but so do the senate and the house. and their own committees. what's the status of those after the comey firing?

>> right. it does get complicated and we're proceeding on multiple tracks here. i think the comey firing to some extend has invigorated the senate investigators and the congressional investigators because i think there are at least some people who think well, with comey's firing maybe the fbi won't be moving as quickly as we thought it might otherwise and that ups the need for congress to move quickly. so i think both of these investigations are going to go forward. they are going to be overlapping. i think it's right that it can be difficult to manage these two things at the same time. but i suspect that there are a lot of folks on the hill now who say that okay, the investigatory spotlight is shifting to us. >> hey, chris, a lot of wall street analysts trying to figure out how this is going to play out over the next several months. cowen has a view you get to october, you start looking a account cr, the budget, the debt ceiling increase. things that require 60 votes in the senate. and that's when the democrats would use leverage points to demand things like a special prosecutor or in their view

perhaps trigger a government shutdown. does that seem not unlikely or in the realm of the possible? >> yeah, it throws a monkey wrench into that process because the director confirmation process is going to take some time, energy and investigation and the investigations of course are going to take time and attention. there's a spotlight on them and given the circumstances, the allegations or what's in the air right now about this is an attempt to sweep things under the rug, i think the other guest is correct. i think this is just going to intensify efforts across the board. but i think it's going to be very critical who steps in as acting director. it's not going to be any andy mccabe. i think they'll be in that role for a pretty good while. >> let's talk about who we'll hear from today. some key witnesses, big power players. mccabe you mentioned the acting fbi director.

pompeo, cia director. coates, national intelligence director. mike rogers of nsa. tom, who's going to move this story forward? who are you most eager to hear from at this point? >> i think most people are eager to hear from mccabe. i'm interested to hear what he has to say. no question he's going to get a pretty aggressive line of questioning from both sides, frankly. i think that the democrats in particular are going to be asking about the state of the investigation. i think they're going to be pushing mccabe to clarify whether comey had in fact asked for additional resources in the days before his termination. i think there are a lot of the democrats who are really going to try to be building the case that this is watergate all over again. i suspect we're going to see lot of leading questions aimed at building and supporting that narrative. >> chris, i'll give you the last word on that. do you agree with what tom just said? >> yeah, i think andy mccabe's testimony is going to be interesting. i expect him to be very cautious and very close to the vest when its comes to spilling out -- it

comes to spilling out investigative details given what just happened of course and that's what got director comey in hot water. we know you can't talk much about ongoing investigations even in front of congress. so i don't expect to get a lot of details here. there's going to be generalities and some generic answers unfortunately. i don't think we'll get a lot out of this. >> we're used to that. that dynamic in some of these hearings. not every one. >> plenty of political theater. >> good to see you both. as we head to the quick break here, look at stocks at this hour. these losses are picking up some steam. the dow is down about 136 points right now. all of the industry groups in the s&p are lower at this hour, led by consumer discretionary. some of the department stores getting slammed. and more on the markets and of

course with our eye on the senate intelligence hearing when we come right back.

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capitol hill for you. senate intelligence hearing. right now you're hearing are from daniel coates, the national intelligence director giving some opening quotes. in the meantime, retailers reporting earnings macy's plunging after a huge earnings miss. another one. the stock is down more than 13%. courtney reagan joins us with more. it's not like expectations were very high, courtney. >> exactly. department store investors had low expectations for this quarter but i guess not low enough because the stores struggled to attract customers. macy's logging another disappointing quarter with comparable sales down for nine straight quarters falling 4.6% in the first quarter. that's biggest drop since this quarter last year macy's actually said this was all to their expectations but shares still hitting 5 1/2 year lows. as macy's earnings fall far short of estimates. however, the department store is reiterating the full year guidance which means they have a lot of ground to make up for the balance of the year.

now, it is ceo's jeff gennette's first time running the earnings call. he told me several weeks ago he's looking at adding more service components and eateries to macy's in the future as well as less basics and more fashion. there's a little better news with kohl's, but not much. they beat the earnings estimates by ten cents, but the comparable sales are falling short and same store sales are sliding more than expected. however, they were helped with higher customer traffic. no guidance change this time around for kohl's or raider nation for that point. it improved in march over february and the under armour product launch exceeded aggressive expectations. he said there were strong results across the categories and it accelerated its active category overall at the retailer. manziel says kohl's will go after consumers to pick up where

competitors are closing stores but he didn't name macy's and jc penney by name specifically. >> courtney. thank you. retail one of the culprits for the weakness today. one of the worst first half hours since march. let's get to john harwood as we continue to monitor developments out of senate intelligence this morning. we spoke with schweiker and dupree a moment ago. your thoughts as we head to q&a. >> i think it's a big moment for mccabe. you saw the remarks from richard burr and mark warner set the table. mark warner saying in advance we're going to counten you to -- count on you to tell us if you feel any political pressure that recalls of course the testimony that rod rosenstein the deputy attorney general gave at his confirmation hearing where he was asked would you appoint a special counsel to deal with the russia investigation and he said, yes, i would. if i believed that it is

necessary under department guidelines to, you know, protect the investigation. we may now be at a moment where people like andrew mccabe who is temporarily in that acting role and rod rosenstein who is number two at the justice department need to step up if they decide they're willing to do that. to try to protect the integrity of this investigation because it's clearly under some pressure right now. >> although john, yesterday, department of justice spokesman denied that comey had asked for additional resources. today, again, a doj spokesperson denies that rosenstein threatened to quit. so what are we doing? we're in this period where reports are very quickly batted down. >> well, they're attempted to be batted down. the default assumption given what we're seeing is that the

spokespeople from the administration are not credible. that is the operating presumption. we had just in the last two days the white house completely contradict its statement and explanation for why fbi director comey was fired in the first place. on the first day they said it was at the instigation of rosenstein who on his own decided to do this report, brought it to trump, trump reacted and fired him. yesterday, and this morning, the white house has said, well, actually, no it was trump who did it. so the administration -- the president personally and the administration itself has very, very weak credibility. so when you have to pit stories that surface in the media that are sourced from respected news organizations, they have a greater presumption of truthfulness than the administration does. >> john, i have a question for you.

you said about -- a lot of people are looking forward to hearing from mccabe. he's obviously going to be sitting in comey's chair. we don't know how long his tenure is going to be because clearly the administration is looking for an fbi director replacement. what can and can't he talk about? he can't talk about the russia investigation, right? >> we just don't know how far he is willing to take it. we have seen over and over from sally yates on monday to james comey himself in his past testimony officials demurring when asked about particular events with regard to russia. they say i can't do it in a classified setting. mark warner indicated in his statement preceding the q&a with andrew mccabe that if you need -- if you can't discuss something in public we will take your cue and not pursue it there. this committee has been pretty

discreet so far. it is not unlike the house committee which was in chaos, the senate committee has been pretty discreet. pretty good bipartisan cooperation between republican richard burr of north carolina, democrat mark warner of virginia. i would expect that to continue and i think those chairs who are trying to protect the space for their own investigation will not be eager to transgress and try to pull anything out in public anything that shouldn't be pulled out. >> let's bring in schweiker and dupree and john on this. mike lee, republican from utah, tweeted today instead of a special prosecutor, chris, the president should nominate merrick garland to replace james comey.

amy klobuchar said, good idea. this is not trolling, he's quite serious. so do you have a basket of senators that will be the tell as to whether or not momentum for a prosecutor picks up? >> well, no, i think it's all over the place as you point out. i mean, there are names being batted around. i mean, obviously senator burr -- i'm a north carolinian, i'm a big fan of his. in terms of his playing things straight down the middle with integrity. he seems to be very intent on getting to the bottom of things. so, you know, ordinarily i don't have much faith in congressional investigations. as you hear -- you hear more from congressmen more than witnesses and the investigations tend to have a political tint to them. so i'm -- i have more faith honestly in the fbi investigation than anything else right now. >> tom, you agree? i say this on behalf of investors who are looking for tells on a hill that, you know -- that they're not as well versed on versus things like

macro data and earnings? >> i think the first thing to focus on is who the new fbi director is because my sense is if the president nominates someone to replace comey who is universally viewed as a person of integrity and independence then i think that will cool a lot of the calls for the special prosecutor. i think right now there are a lot of folks on the hill who say that the fbi can't be trusted. because trump is going to put in some crony or a political hack and so i think the big test for the administration now is to name someone who is unimpeachable because i think that will give a lot of comfort to middle of the road folks in congress who say, okay, that was a good, reasonable choice. let's let the fbi do its job. >> yeah. do you have a for example before we take a break? condoleezza rice's name got tossed around today. >> so did james comey. >> i think condoleezza rice would be terrific. there have been a lot of names that have been floated around. i think you want someone with a solid background in law enforcement. again whose independence won't

be questioned. >> chris, tom, don't go too far. we'll check in with you again and john harwood after the break. the dollar remains under pressure, down 1.24. worst stocks of the year, macy's, signet, under armour. >> all down today. worst day for the nasdaq. worst one day drop since back in march. hello, my name is watson. i am helping 8 million taxpayers

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good morning. i'm sue herera. here's your update this hour. a u.s. congressional delegation led by house minority leader nancy pelosi meeting with the indian prime minister modi in new delhi. yesterday, she met with the dalai lama. rescue work continues as aftershocks hit the northwest region after a quake struck the area killing at least eight and injuring 23 more. rescuers and locals evacuated and cleared the debris. trucks removed a controversial statue of former confederate president jefferson davis overnight.

it's the second of four confederate era monuments to be removed from city landmarks. the workers were forced to wear the masks because of threats of violence. summer hiring is expected to soar this year. it says 41% of employers plan to hire seasonal workers for the summer compared to 29% last year. 79% say they'll consider summer hires for permanent positions that's good news. that's the news update this hour. back downtown to you guys. >> sue, thank you. we want to take you straight to capitol hill to the senate intelligence hearing. where some of the witnesses are taking questions including andrew mccabe, acting fbi director. >> -- may have had with the president. >> okay. general stewart, you heard director coates state on everyone's behalf there's an expected deterioration of conditions in afghanistan.

can you give us an assessment of the situation today in afghanistan and what would change that deterioration? >> thanks, mr. chairman. i paid close attention to the operations in afghanistan. i make two trips there each year, one before the fighting season and one following. that way i get on the ground. my own personal assessment of how things are going. i was there about six weeks ago. the ndsf two years into taking control of the security environment, they had mixed results in this past year. those mixed results can be characterized -- can characterize the security environment as a stalemate. and left unchecked, that stalemate will deteriorate in the favor of the belligerence. so we have to do something different than we did in the past. let me back out and talk about the fact that the taliban failed to meet any of their strategic

objectives that they outlined during the last fighting season. >> all right. we'll continue to monitor this for you. the topic is the world threat. so that does include things like afghanistan, the middle east, fighting isis. we'll listen for any comments on the firing this week of james comey. we have got acting fbi director there, andrew mccabe. first answer was he couldn't comment on the interaction between the president and between the former fbi director, james comey. we'll keep an eye on it for you. we're keeping an eye on the market. the s&p is down more than half a percent. we'll be right back. i joined the army in july of '98. our 18 year old was in an accident. when i call usaa it was that voice asking me, "is your daughter ok?"

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welcome back. watching a bit of the sell-off on wall street this morning. dow's down 114. s&p is down almost 15 points along with the senate intelligence hearing which continues in washington, d.c. q&a going on with acting fbi director mccabe. mike santoli is here at post 9. you don't have to look too far

in the view of some. >> no, in fact, yesterday was the dog that didn't bite, the market didn't react. unless it's a broader perspective that says look if d.c. kind of gets bogged down and is at a stand still with regard to policy it's one fewer thing to kind of look out on the horizon and say, that's an offset to a fed that looks very resolute. to basically, you know, earnings that had been good but we had the best of the four quarters in terms of year over year growth. i think in terms of longing for that little bit of a policy boost it will detract and then branches at war with one another is never good. the unanswered question is if in a bigger way it filters into consumer attitudes and things like that. if we're back in the old familiar 2% economy, and if fed wants to get it moving again, bank stocks are down big again, because the rates have that flatter yield curve.

that's one thing you have to absorb. >> one thing interesting is that the oil prices are up a percent and a half. we have decoupled from oil. it didn't hit us on the way down last week. but this week has been very strong. it's not given the market much of a boost. >> not at all. i think in the range, the rest of the equity market kind of says well oil is doing its thing within that range. we won't worry too much about it. also energy stocks are a relatively smaller piece of the overall index. as we know it's about the big growth stocks carrying things for a while. i think that -- it's interesting, energy when it's been weak has not really impacted the junk bond market either. i mean, that was kind of the way it got transmitted into stocks a year and a half ago. >> we started to get traces of that conversation revived at 46, right? some notes came out, is it time to get worried again. >> sure. >> after the best day of the year for wti, it may be less so today. vix at 11. we'll talk about that in a

moment. let's get back to q&a. >> accurately characterize the extent of russian activities in the 2016 election and at the conclusion russian intelligence agencies were responsible for the hacking and leaking of information hacking and leaking of information, and using misinformation in order to influence our election, simple yes or no would suffice. >> doir >> yes, i do, senator. >> yes. >> yes. >> yes. >> i guess the next presumption is consequently that committee or that community assessment was unanimous and is not a paid piece of fake news or evidence of some other individual or nation state other than russia. i appreciate that. mr. mccabe i warned you i would have to get you on the record on this. mr. mccabe for as long as you are acting fbi director do you commit to informing this

committee of any effort to interfere with the fbi's wrong going investigation into links between russia and the traurch campaign? >> i absolutely do. >> in light of what's happened in the last 48 hours, it's critically important that we have that assurance and i hope you relay at least to me the extraordinary people who work at the fbi, that this committee supports them, supports their efforts, supports their professionalism and supports their independence. >> i will, sir. thank you. >> in like of the fact we just saw french elections where felt like deja vu all over again, in terms of the release of series of emails against mr. macron days before the election and the fact that this committee continues to investigate the type of tactics that russia has

used, where do we stand as a country in terms of preparation to make sure this doesn't happen again in 2018 and 2020? where have we moved in terms of collaboration with state voting and voter files, in terms of working more with the community, particularly the platform entities in terms of how we can better assure real news versus fake news? is there some general sense. director you've been on the job for a short while. how we'll have a strategic effort. it was russia in 2016. other nation states could launch similar type assault. >> well, we will continue to use all the assets that we have in terms of collection and analysis relative to what the influence has been and potentially could

be in the future. russians have spread this across the globe, interestingly enough i met with the prime minister of montenegro, latest nation to join natural jobs number 29 nation. what was the main topic? russian interference in their political system. so it does, it sweeps across europe into other places. it's clear russians have upped their game using social media and other opportunities in ways that we haven't seen before. it's a great throat our democratic process and our job here is to provide the best intelligence we can to the policymakers as they develop a strategy in terms of how to best reflect a response to this. >> one of the things i'm concerned about is, we've all expressed this concern but since this doesn't fall neatly into any particular agency's jurisdiction, who is taking the point on interacting with the

platform companies, facebook, google, twitter, who is taking the point trying to ensure our systems are more secure. >> well, i think -- obviously, our office tasks and takes the point but there's contribution from agencies across the ic. you might ask director mike pompeo to address that and other that might want to address that also. but each of us, each of the agencies to the extent that they can, and have the capacity whether it's nsa, whether its nca or other sources will provide information to us that i want to use as a basis from provide to our policymakers. relative to a grand strategy, i am not aware right now of any --

i think we're still assessing the impact. >> my hope would be that we need to be proactive in this. we don't want to look at this after the 2018 election cycle. do you have any doubt that the russians are behind the intervention in the french elections? >> let me phrase think it way. we're aware of some russian activity directed against the french election process as i previously said before congress earlier this week we, in fact, reached out to our french counterparts, we're aware of this activity, we want to make you aware. what your seeing. i'm not in a position to look at

the breadth of the french infrastructure. i can make a simple declaratory statement. >> senator rubio. >> mr. mccabe without going the specific of any individual investigation i think the american people want to know, has the dismissal of mr. comey in any way impeded, interrupted stopped or negatively impacted any of the work, any investigation or any ongoing projects at the federal bureau of investigations? >> as you know, senator, the work of the men and women of the fbi continues despite any changes in circumstance, any decisions, so there has been no effort to impede our investigation to date. quite simply put, sir, you cannot stop the men and women of the fbi from doing the right thing, protecting the american people and upholding the

constitution. >> and this is for all the members of the committee as has been widely reported, and people know this, because software is used by not hundreds of thousands, millions of americans, to each of our witnesses i would just ask would any of you be comfortable with the software on your computers? >> a resounding no for me. >> no. >> no, senator. >> no, sir. >> no, senator. >> no, sir. >> director mike pompeo, armed civilian groups, militias in the streets of venezuela have been armed by the regime for -- >> senator mark rubio. we'll continue to follow the kwrn and a portion of the senate intelligence committee hearing. bring you headlines. bring you live. keep you apprised of the market

activity with the dow down 113. we'll be right back with sidewalk al "squawk" alley. talk to your advisor about a brighter financial future.

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