52-week high. i'm going to send it out west for the start of "squawk alley." >> thank you very much. it is 8 a.m. here for the final day of code, 11 a.m. back on wall street and "squawk alley" is live. ♪ ♪ good thursday morning. welcome to "squawk alley." before we get started, though, we got some new eia data out a

few minutes ago. let's get to jackie deangelis kat the commodities desk. >> the draw-down crude inventory was 6.4 million barrels. both numbers were steeper than expectations. the gasoline drawdown almost 3 million barrels. that's adding to the boost you're seeing as well. crew traders are watching for trump's announcement on climate change. maybe some of the regulations will roll back and it will be good for the drills are in the country. a little bit of mixed circumstances taking us higher today. >> big story to watch today. thank you, jackie. some of the top names in media taking the stage at code last night including sheri redstone and time warner's tom bewkes.

take a listen. >> you have a joining set of b subscribers with different bundles. that's where we see it. we'll have to see how the new parts of the media or the video infrastructure, whether they mitigate the loss from the old infrastructure. >> and for more we are joined now by founder and chairman of the case foundation and krp eo of revolution, as well as the founder and former ceo of aol, steve case. steve, good to have you. >> good to be with you. >> jeff bewkes made the case he's hoping it comes down to scale of distribution and quality of data about who the audience is. do you buy that, that's who it's really about? >> it was a little surreal, the

aol/time warn eer merger. it seems it's more of an at&t hedge, a broader mix ofportfolio be as reliant on the distribution side. for jeff and time warner, the stock has done well. i think it's a way to call it a day and hand the baton on to somebody else. i'm glad they're now focusing on some of the things that i wished they'd focused on 17 years ago before youtube and facebook and things like that existed. time marches on. >> the internet service providers are trying to make the argument they deserve to play by the same rooules as google and facebook. you know you're giving away some privacy to use those, your isp is different. is this important? >> it's important to know that

the playing field is level. how do you make sure the innovators can innovate, the disruptors can take on the incumbents. that's what makes exciting conferences like this, new ideas and make sure entrepreneurs all across the world have the ability to perform and take their ideas and the incumbents aren't abusing their position. we had this debate with microsoft and there was an anti-trust issue with microsoft and call for open access around the cable companies so it's not a new issue but making sure innovations continues to flourish and disrupters disrupt. >> can netflix become hbo faster than hbo can become netflix? would you rather have great brand and content -- >> i'd rather be doing interesting disrupting things, not just focusing on the

historical battles. what i've written in "the third wave" is how do you disrupt, change health care. >> cas-- education, and there's lot of new ideas. that's where i think the focus should be. >> sound a lot like what ann dreesen said on saturday night. >> no question. some of the most important aspects of our lives, health, how we manage and get around cities. i think it going to require a different mindset. we've some of it at this conference. partnership are going to be important. you want to change health care, you have to work with the doctors and hospitals, it not just an app in the app store. there's going to be some regulation about drug safety or food safety or drones in the sky or driverless cars on the road. the entrepreneurs need to engage with policy makes are and have

constructive dialogue. >> do you feel like the code crowd, the tkech elite is focusd enough on middle america? i get the feeling it's come up a few times. maybe it a gm gnat buzzing arou the head of tech, more about we better do something before they get in the way of our agenda? >> it's a mixed bag i applaud mark zuckerberg, for example, for hitting the road and seeing what's going on outside of silicon valley. while some appreciate what they can do on their smartphones, they worry about jobs in their communities. i think we need to do a better job of reaching out and trying to have a more inclusive economy and not be so arrogant. 75% of venture capital went to california, new york and massachusetts. so when people in the middle of the country feel they've been left behind, it because they

have been left behind. if you're not funding all of these other cities, you're not going to be creating jobs in those cities that are going to offset some of the jobs lost because of disrupt of technologies. >> if mark andreesen said -- i respect mark but sometimes his points may be a little more pointed than are accurate. there will are some unintended positive consequences of technology, the artificial intelligence and robotics and it will create jobs, but there are also are going to be job lost. to just focus on the positive and how it benefits silicon valley and makes the entrepreneurs and investors in silicon valley richer is not the message. we saw this in the presidential election. part of the reason donald trump won, 85% of the venture capital went to the states that hillary clinton carried and only 15%

that donald trump carried. there is a real sense out there while technology clearly benefits people's lives, they appreciate that and respect and applaud the great entrepreneurs that come out of nowhere and create these great successes, there's a greater concern and i think we need to better understand that and i think it would be great if silicon valley understood what is happening and started investing and mentoring and partnering with the entrepreneurs in these cities so they can accelerate. >> what is the best poster child right now, something that is going to change the city the way austin was? >> i visited 26 cities in the last three years. pittsburgh, basically powered the whole industrial revolution, the steel capital. mao because of carnegie mellon, arguably the best university in the world, google as opened a big office, uber is doing

business in pittsburgh, a city that people gave up on is roaring back, chicago, a company called uptake started three years ago, a thousand employees, nearly 100 data scientists doing some very sophisticated around precision analytics. baltimore because of the success of underarmour, doing stuff around health tech and monsanteos and agricultural technology. we need to celebrate what's happening in boston and rising in los angeles because the snapshot, we need to level the playing field so everybody everywhere has a shot at the american dream and we're creating jobs and hope and opportunity everywhere, not just in a few places. >> maybe some of that investment will start to shift. steve case, former founder of aol, thanks.

>> president trump expected to make his announcement about the paris climate accord around 3:00 eastern time. hearing from a number of tech ceos today urging him to stick with the agreement. our eamon javers is covering that from the nation's capital. >> reporter: the president hearing from a score of ceos today and the president is expected to make the announ announcement in the rose garden. he's expected to announce the u.s. will withdraw from the accords or will he change his mind at the last minute. take a look at some of the executives who have spoken on the question.

>> we identified them and communicated with voters. >> that obviously was hillary clinton, not meg whitman. what meg whitman said was please do not withdraw from the paris climate accord. this is not in the best interest of americans. we need to own the next generation of jobs and whether that's clean energy or 3d printing or immuno therapy, this is an arena america should lead. >> and mark benios responded and they realize the president will make enemies on which ever side he goes. let see if we can hear meg whitman. >> please do not withdraw from the paris climate accord. this is not in the best interest of americans. we need to own the next

generation of jobs and whether that's clean energy or 3d printing or immunotherapy, this is an arena that america should lead and must lead. i think this would be a big mistake if he withdraws from the paris climate accord. >> a lot of suspense here. the president famous for these reality tv style of unveilings. we expect something similar today. >> we just said good-bye to steve case here but one last comment on this, is there an argument to withdraw, steve? >> he made the argument on the campaign trail so i think that's why he feels like he has to do something. a lot of people feel like somehow destroying jobs -- as meg whitman, i think it's an opportunity to create jobs. some of the next generation jobs and innovation economy can be in this country. if we're going to continue to lead the way being the

entrepreneurial country, we need to lead the way and not be out of the step with all of the leaders on this important issues. hopefully he says something that appeals to the base but also from a policy doesn't completely walk away from. i think it would be a big mistake for the country and for the world. >> you went to trump to you are and agreed to be part of this policy forum with this president despite the reputational risks and this paris accord decision does not go your way, does that change your calculus as to whether you go back. >> it has to be different for each ceo. i've encouraged elon musk to be in the room -- if he did go forward and pull out, elon would leave and i think that's a reasonable thing to do. they're figuring out issues around policy and encryption but

there's a point where you feel as a matter of principle you have to step aside. i applaud the fact that elon stayed in the room as long as he has. if president trump does decide to pull out of the accord, i would support elon musk of stepping aside. >> the nasdaq hitting another record high. the s&p 500 for its part up about a quarter of a percent. the dow moving up by 31 points. we've been watching it all week. how about alphabet hovering right around that $1,000 a share mark. it's actually off down a third of a percent. we were watching it after hitting $999. the ten-year yield moving a bit higher here this morning. we did get an adp report, private sector jobs adding 253,000 jobs in the month of

may. bodes well for tomorrow's big government jobs report. mike santolli is with me. some of the less favored names are higher today. >> you're seeing mild rotation out of the winners from may into the some of the lagage. if you turn the performance tables upside down, you'd have something close to what's happening today. russell 1,000 and whether it's a one day of unwind. it's interesting you mentioned the treasury, they didn't really rush to price in a lot more acceleration in the economy. just up to 222, maybe you you don't give full creeds and to the adp report -- >> but manufacturing -- >> the numbers were okay.

it seems the burden of proof is high for the wall market. -- bond market. >> coming up executives, airlines with our capital founder brad gerstner. and when we come back, kara swisher and that wide-ranging interview she had with hillary clinton. "squawk alley ou" will be right back. ke her see trends to stay ahead of her competition. no more sleepless nights. - we're going to be friends! - i'm sorry about this. don't be embarrassed of me, jim. i'm getting excited about this! we know the future. we're going to be friends! because we're building it. what?pony neighing] hey gary. oh. what's with the dog-sized horse? i'm crazy stressed trying to figure out this complex trade

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walmart is making a big bet on virtual reality, revealing a new employees training tool. walmart is set to add a new vr tool at its 200 academy training centers in the u.s. by the end of the year. its backers include sheri redstone, advance-it capital and more. derek, good to see you. >> good morning, sarah. thanks for having me. >> we talked about how your software helps a lot of nfl and sports teams try to improve the players' training. how is this going to work with walmart employees? >> great question. i was on this very show two years ago talking about the work we've done in sports. we're taking the same model we used with athletes and pouring it directly over to the every day employees, using virtual reality to simulate experiences,

simulate decision making that an employee would have to make on daily basis in a walmart store. it's more complicated than that but it's how do you give to employees on all levels in wall smart stores. >> what do you actually do in terms of presenting this tool to the companies in do you have to go out and gather lots of data images? how do you actually collect the raw material for this? >> great question. today we're doing everything start to finish. we are a human performance company, not necessarily a v.r. company. we are using emersive technology to retain, learn information faster, better. with walmart, we've been working

with them for about the last nine months, obviously under wraps for a while until yesterday. and at the very basic level, we sit down, we talk to them about what are your pain point, what are the things you would like to put into v.r., what are the things your employees struggle with on their exams through the academies, what are the things that affect p & l, what are dangerous situations, what are things that come up once or twice a year that have high r.o.i. impact? we sit down and map out what makes sense for v.r. and everything that doesn't make sense, continue with your traditional learning. the things that do make sense, we track data to measure the effectiveness of what we're doing. we're really doing everything as it pertains to the start-to-finish v.r. experience. >> can you give us some examples of what walmart's answers were

on some of the pain points and the areas they'd like to improve. we've talked a lot about the pain that retail is facing in store traffic and employees. i'm curious as to what specifically you're helping with and how you're going to expand into retail. >> sure. obviously some things are going to remain walmart competitive advantages so i'm not allowed to say everything that they're doing. but customer service, what bhaks a good customer service experience, what makes a poor customer service experience, having managers better understand that. spotting errors in certain parts of the store where in the real world they simply do not have the time to set this error up, take it down, do it for employee a, b, c, d. this is a more time efficient way of going about training. what we know as black friday, that happens once a year. half of walmart's store management has never been in a

black friday before as a store manager. how can we get them up to speed faster on the things they need to know and the mistakes they seem on every whoever day rush season. we're going to look at safety, identifying hazards, identifying weather warnings, active shooter warnings. things where fractions of a second, much like an athlete with the work we've done in sports, things where fractions of a second impact decision making and are a really, really big deal. that's kind of what we're going after here. >> do you expect the commercial applications like this is going to be where most of the opportunity in vr is for now? obviously initially there was a rush to assume it was going to be kind of a consumer application and beyond gaming. i don't know if that's really taken hold. >> so the numbers just to be very canned it with you, mike, the number are not what people

thought they would be a couple years ago with projecting v.r. headset sales. that being said, they're still very good. but to your point, a lot of it is in the gaming community right now. the hardware will get better, the technology will get better for the every day consumer, but we have a very, very strong opinion on v.r. being extremely powerful for training, for simulations and we feel obviously at strivr that training is going to lead the way. it's a tangible use case, it makes a ton of sense. v.r. was not invented when facebook bought okculus. we brought it to sports in a cheaper, lighter, faster way when an interception is a high cost of failure for a

quarterback. how can we take that flight simulator model and apply it with retail. we're going to continue to push this pretty hard as it relates to using v.r. to improve human performance. >> we're going to have to have you back on, derek, to talk about what you're doing in financial services. saw bank of america was a client as well. thank you for coming on to talk about this new walmart collaboration. derek belch, ceo. >> shares of palo alto network up more than 15%, on pace for the best day since the company went public, the company topping estimates on the top and bottom lines. it's fighting its way back. "squawk alley" is back right after this. [ crickets chirping ] [ light music playing ]

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welcome back, stocks here inching higher. >> keep in mind the stock 600 is in the midst of a four-month winning streak for the first time since 2013. as we count down to the election in the united kingdom, according to the latest model, maze is short by six seats. he says investors are concerned about the possibility of a hung experiment and that some market participants appear to be buying sterling puts for protection.

ahead of president trump's decision on the accord, lee said china will stick to its commitment on climate change. merkel said germany must expand its partnership of china during what she calls a time of global insecurity. we finished with transatlantic takeover bottle coming to an end. ppg withdraws its bid after it won a court battle over akzon e akzo nobel. >> "squawk alley" will be right

back now. at crowne plaza we know business travel isn't just business. there's this. 'a bit of this. why not? your hotel should make it easy to do all the things you do. which is what we do. crowne plaza. we're all business, mostly.

good morning. here is your cnbc news update. president trump signing a six-month waiver to delay relocating the embassy from jerusalem to tel aviv. two people remain missing after an explosion after an explosion

of a wisconsin corn mill rocked the area. it knocked out power to more than 100 homes. >> the supreme court sat down for a group photo opportunity. the nine justices, including the new member, neil gorsuch, were all smiles as they posted for the photographer. they will be back at work next monday. >> and the pittsburgh penguins took a commanding 2-0 lead in the stanley cup finals by beating the nashville predators 4-1. they took a 2-1 lead in the game by scoring just 10 seconds in period three. the next game is saturday night televised on the nbc sports network. let's go out to carl in beautiful rancho verdes california. >> thank you very much, sue herrera.

we're here at the code conference. joining me is brad gerstner and an investor in ub aer and very publicly united. it's good to have you. you thought walt's column was right on the mark. >> spot on. first walt's a legend. i was thrilled to see him get his just due. i like that he started saying it's too hard to compute and ended by saying i now have a glimpse into the future. it's set for us to start solving problems. >> the investing theme that follows from that is what? >> what do you situation? >> as we discussed, we're investing in andy rubin's new venture, essential. we think andy is going to build the best android devices in the world. ambien os we believe will be the

beginning of the push to a post-app world. rather than having to download all the apps to book a hotel room or order something from the kids, you're just going to speak it, whether in your car or office or home. this isn't about wearing helmets and virtual reality and crazy silicon valley stuff. this is about getting your dinner, ordering clothes for your kids and booking your hotel. >> andy reuben has says he wants essentials devices to summon siri, alexa or which ever you want to use. it's not clear whether google, apple and amazon view these as ecosystems or whether they wall off the ggarden. if they wall off the garden, it's not going to work well.

>> anwell, andy said he wants t improve android. there are 2 billion android products in the market today. we think there's plenty of room for a high price piece of hardware using android. whether people will want to use their echo or their google home, but we think the person who invented android is in a very good position to help usher in this new wave of ambient tech. >> it tells us something about the new chapter of kmodization. >> i believe apple's emergence has not been because of their services but because of their elegant hardware design. i think hardware becomes increasingly commoditized over

the course of the next few years so software is going to become a lot more important. so whether we used spotify or itunes, gmail or apple mail, whether we use i clouds or google photo will matter and we don't see a pace of innovation at ios that we see locks out somebody like essential or android. >> that was the pro samsung, anti-apple argument three or four years ago. you have a new acronym. it's not just about fang anymore, it's about ape. what is ape? >> we've heard a lot about owning fang. i think it's a highly consensus choice today, fantastic companies, facebook, netflix, google, amazon. but we think one of the largest categories in global commerce is

travel, ape, air bnb, priceline and expedia, we think you have a multi-year play here whery can go from $150 billion of enterprise value to $300 or $400 billion of enterprise value. this is a place where alibaba and amazon don't play today. >> yet. what happens if they do? >> people have worried about the verticalization of these horizontal players for years. the reality is by our accounts, google makes billions and billions, maybe upwards of $10 billion off global travel by if a si-- facilitating transaction. they're happy to let the verticles players do what they

do and they'll provide top of the tunnel search for these groups. >> does it change the investment environment at all if president trump does back out of the climate accord? >> what will ultimately change the tune is if people think he's lost the political capital to push a reform agenda around regulation and taxes. we're starting to feel a koreshnd okores crescen crescendo, a lack of political capital and if we get to the point where we lose faith, we'll have -- >> some have tried to argue that no expectations for anything giant this year, maybe next year, you're running into mid terms. you think there's still some

downward potential on policy expectations? >> at the end of the day, we're nine years into an economic recovery, right? any slowing in economic growth due to lack of regulatory reform and lack of tax reform will have consequences in the market. will that show up in the vix early in. >> ultimately in multiples. >> you mentioned a.p.e. i assume that's a good corollary to your airline play which remains as strong as sneever? >> we're just getting started. it's a secular grower. a lot of people have made news about berkshire's investment in the airlines after saying they were terrible investments for 30

years. berkshire's investment in the railroads is a secular investment. we're going to have more people plying and we're not building more air ways or runways. we think there's a multi-year play for united and the airlines generally to get the credit they deserve. >> it's good seeing you as always. >> thanks for having me on. it's been a great code conference. >> and when we come back, kara swisher will sit down with us and talk about her recode with hillary clinton. rick santelli, what's on your mind today? >> looking at the data, we had some interesting data. chicago yesterday and ism today. what i'm really paying attention to is the linkage between the dollar, euro versus the dollar and interest rates. we'll talk about that after the break. ♪ the man in the back is ready to crack ♪ to a different comny

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coming up on the half time report, several bank owners raising kens on the sector. >> and why some say the rally isn't over for the fast food giant. we've made it our call of the day. >> and is intel a buy or sell? we'll discuss top of the hour. speaking of code, let's go back

to carl out west. see you in a bit. >> let's go to rick santelli. >> i was asked yesterday and i love being asked about markets. it's kind of my career and my hobby, my fashion. whether we're going to hold this lower end of the range in treasury yield, the lower end of the range can be defined in many ways, it was 2.70 to 2.60. the question is bigger than that. it doesn't matter as much if we have a violation, tough 3% or even though i don't think it will happen we briefly spend time under 2%. because in my opinion, it's more about timing. how long a market stays down. in other words, you know, it's like you drive for show, you putt for dough. you can pick the lows, that's for sewer.

but where the market spends its most time is the most defining issue of your position and your capital preservation. if we have a quick rally that pushes yields down another 8 or 9 basis points but for the most part for the balance of the year we trade above that, what does it really matter? so to me the big issue continues to be the weakness in the dollar index, down about 5% or more for the year thus far, interest rates also down hovering around 2: 2.20, they settled at 2.44. the problem is one currency's gains are always another's losses. so then it's hard to balance it out. but in the simple measure of it, if you believe that the dollar index is going to continue to move down, many think around 93 1/2 to 95 is where it's going to settle out, it's very

difficult for me to think rates are going to go up. so i continue to look at foreign exchange as the key. use 112 as the euro versus dollar pivot. but if you look at a 20-year chart of the dollar or a ten-year chart of the euro versus the dollar, 120 of euro versus the dollar as the outlier, don't think you're going to see a two and a half tenure if that occurs. >> thanks for that. straight ahead we're back here at the code conference with kara swisher. >> what we saw was in this election particularly and i appreciate what walt said, the first time that you had the tech revolution really weaponized politically -- before it was a way to reach voters, collect

fund-raising, do things that would help the candidate who was behind the messaging. that changed this time. at crownpla we know business travel n't stus the's this 'a t of this. why not? your h shoulmake iea to dall e things you do. whh is whawe do. crowne plaza. we're all biness, mos

welcome back to the code conference. hillary clinton speaking out about technology and its role in her devote during the 2016 election. she called out social media and what she described as weaponized information. >> if i put myself in the

position of running a platform like facebook, first of all, they have got to get back to trying to curate it more effectively. they have to prevent fake news from creating a new reality that does influence how people think of themselves, the world, the decisions they make. >> kara swisher did that interview and she joins us here at the code conference. kara, thanks for coming back. >> no problem. >> she was highly criticized and is today again for blaming the times and the dnc and the russians. is that drowning out a more important message about tech? >> i think so. you didn't hear the whole thing. we were here, we know. the reaction in the room was very different. they were weren't listening to it. they didn't listen to the whole thing. with hillary clinton, no matter what you do, she's a lightning rod so they pick out different parts of what she said. her main point about the weaponization of social media is 100% correct. right now social media, whatever you think of her, and she did say that, people didn't hear

that part, it's clear the russians were involved so i think the issue is what do we do about it, what does facebook do about it, what does twitter do about it. just from a business point of view, do you want a platform where a lot of trash is running around, a lot of crap and a lot of stuff people aren't using social media for. so it's like spam in advertising. it's worse than that because it affects our democracy and things like that, but, you know, you don't want a platform where there's a lot of spam. you don't want a city with a lot of broken glass. from a business point of view, creating platforms that can be easily manipulated by bad players is a bad business proposition and it's bad for our society too. so that's the degradation of conversation and it's something facebook should be concerned about, twitter, so should all of us. >> i don't want to mischaracterize it, but they were making the point on cnbc this morning the good counter

balances the bad. yes, bad information gets out but it's corrected on social media just as quickly. is tech taking this message to heart that change is necessary or is this still sort of this idea that, yeah, it's okay for it to be state of nature out there, it will work itself out. >> no, i don't think they are. this has been my big thing that i've been harping on. i think they don't understand the impact of their platforms. they'd love to see them as benign, that they're just here to help, it's a happy, shiny future. look, automation is going to hurt. it's also going to be good. robotics is going to hurt. it's also going to be good. they hate to say the part where there's going to be social dysfunction because of the things they created. and it's fine to say that. they just never want to not say it's a happy, shiny future and everything is great once you get on snapchat. okay. but anyone who's a pamrent of a teenager goes just a second. the parent with the screen in their face, you know that has an issue. reed hoffman is like social

media is all good and doesn't waste your time. anyone who's spent 20 minutes on facebook knows that's 20 minutes you're never going to get back. is it good for you? i don't know. neither are twinkies. >> a column in "the times" makes the point of the companies she mentioned boy name, she talked about google search, facebook curation, is facebook the locus of her criticism? >> yes, because that's where most everyone gets their information. i was talking to facebook last night and they thought she was 100% right. interestingly, they're not like -- and so is mark zuckerberg, he talks about it. community has been degraded because of our reliance on social media. he knows his responsibility and they're making moves to fix it. so if the company who she criticized thinks she has a valid point, maybe she has a valid point. i think, again, it's hillary clinton so no matter what she says, there's certain people -- i joke that if you got a cat out

of a tree, he'd be accused of animal abuse. hillary clinton will create controversy on both sides, people who love her and people who hate her. so if you were in that room, she was making a fascinating argument as a whole, but it's complicated, it's nuanced, it's not easily digestible. we live in a world where we have a president who tweets reductive things so reductiveness works and she's not reductive. that's where we are. and social media is reductive. >> it sounds like the germans and merkel are saying we've got this, we don't need to learn from what you guys went through last year. >> yeah. >> does that worry you? >> no, no. i think they are doing things in place. >> really? >> yes, on their own. they are taking these lessons to heart about what happened here and trying to -- you know, one of the things i do think hillary clinton was right on, and i know the dnc is reacting badly, but you know the democrats, terrible digital performance in this election. the republicans, kudos.

sometimes some of the things might have been nefarious, we'll see, that will come out in the investigation, we don't know. but in general on the above board stuff, fantastic performance by the republicans digitally. >> "squawk alley" will continue in a moment. at fidelity, trades are n j$4.95. we cut the pceades to invesrs even more vue. and $4.95yocacaade a clearanta

got a record high on the s&p, ticks above 2418. we will watch that. looking for news out of the president on the paris accord and then more coming up. >> looking forward to having an interview. also watch palo al owe networks and blackberry. let's get to wapner and the half. welcome to "the halftime report." i'm scott wapner. our top trade, bank shock. why one well known marketwatcher says that space too treacherous to invest in. you'll hear from him live in just a moment. with us josh brown, john terranova, erin brown with us as well. let's begin with the banks. the red flags, some executives are raising on that space. words of warning that sent many of those stocks selling off this week. they a