figure out -- i think to let high school kids go into the draft if they're ready if not have them be in school for two years, so we legitimize both ends of the process i think it would help the educational universities to have a kid there for at least two years and be halfway towards graduation. >> well, thanks for that. >> thank you for having me. >> good luck right at 9:30, okay, eastern time don't get nervous, you're going to be great. >> a little bit nervous, sweaty palms. >> thanks so much. we appreciate it. folks, right now it's time for mosquito for "squawk on the street. good morning welcome to "squawk on the street." i'm david faber along with jim cramer we're live at the new york stock exchange we set you up for the open a

half hour from now it looks likes the s&p may be down ever so slightly. european markets were in the red last time i look thank you for spain and for italy, maybe one day we'll even get a look at the bond market. the ten-year note yield is important right now, particularly given that -- >> 2.14. wow. >> wasn't it supposed to be a 3.14 >> yes, i think they were talking around june, at least 3. not the case a big story we're going to talk a good deal more about is oil. let's get to our road map and start you out with some stocks oracle, shares are up sharply on earnings we'll look at what's moving that stock. later, by the way we'll have an sclouf on interview with mark hurd they want to take a major

stake in american airlines, what is that all about? >> smoke 'em peace pipe? >> we'll try to figure that out to the best we can by the way, what as to yim cramer and homer simpson have in common adobe's ceo shows us. >> he's game. >> he's got a demo of its newest product. >> i want to see that. >> we have so much to talk about, it's scary. let's start off with oracle. they are up in the premarket, on track to open at a record high for this company after it posted better than expected quarterly results. it got a bit lift from the cloud computing business, trying to go into competition with the likes of microsoft p. >> yep. >> and google or alphabet as we like to call it, mark hurd saying it was the best quarter

ever heard don't want to miss that. what are your thoughts, jim? >> eight for nine, david eight for nine nine analysts on the conference call, eight of them say -- that's the highest ratio i have seen in 2017, which makes it so that you have to understand they delivered. now, david, the -- >> it makes my skin crawl. >> there are two qualities i always appreciate on a call that you never get anymore -- confidence and hue brings. the confidence and hubris, it was deserving, because these guys have pulled off the battle ship that ibm can't do yet they went to the cloud with remarkable growth. we're talking about 60%-plus, the clients that they racked up this quarter were amazing, and it's not over, as mark hurd, who will be our guest -- did we mention he's going to be our guest? >> you speaker it h-u-r-d.

>> but i pronounce it with a philadelphia accent. put quotes around "extremely" underline it larry ellison did some trash talk at salesforce, and safra katz, who has met with the president, just joy, she is such a hitter it's so great to hear her say, we are at the beginning of our breakout david, this is being rerated right in front ofus from value to growth. it's done with the problems with the incumbency of the numbers dropping off they barely, barely dropped off. i thought the call was pure joy, david, a victory lap callings but it may be the first of a dynasty. i got to tell you -- >> will they play "ode to joy" during the call? >> they should have, yeah. >> let's listen to ellison taking a shot at your man. >> he had to do that

he was benioff's mentor. >> last fiscal year we sold more than $2 billion in cloud annually recurring revenue this is the second year in a row that we have sold more cloud a.r.r. than salesforce.com we are well on our way to passing them, becoming number one in the enterprise sas market. >> there it is. >> he has more than just customer relations he has enterprise resource planning so he's right. we had at&t earlier. at&t will be expanding the relationship mark hurd was -- he mentioned more customers he to cut it short because there were so many customers, he didn't want the there isn't

anyone, right? no one says a who are about amazon ellison says we're cheaper than amazon and we're better. ellison fears no one, and remember he owns an island. >> he does, a large island in the state of hawaii. >> you the other day in a fantastic interview talked about a country, an economy that is alibaba. >> those are jack maw's words. >> ellison wants to make it a country. it's beautiful island. >> and i underestimated larry at one time, therefore he doesn't like me at all, and that's okay. he has a long memory, but they surpassed it ibm has to make this transition. >> that's what i wanted to ask you about. a couple nights ago you talked about i built m has not been able to do what they are doing explain that to me. >> they have a legacy business. >> we do we talk about it all the time.

ibm has the growth businesses, but when will the growth there outpace the loss >> that's right, the strategic empire, they're ahead of the program, but the problem is the incumbency business, the old business is falling off rather rapidly. >> rapidly. >> oracle's incumbency business had been falling off rapidly, but pretty much leveled off. see, both the -- >> so what are we talking about is the incumbent business? >> the on-premises business. >> having it right there for you as opposed to using the cloud. >> that's four times more expensive. so the idea was if you migrate people to the cloud you'll be in a bit of trouble, because you will use some high-margin business safra katz explained how this could be a higher margin business than we thought imagine ibm has to get the margins up and not get the old

business not drop off. now, they did -- they did the net suite. >> and there's some momentses in call where hurd tries to drive -- he says it's a conference call, i can't show you my face how terrifically netsuite does, but these guys are unlike anybody else on the call they were confident even when things weren't as strong the confidence is based on what i regard as a level of superiority about that company's long-term view ibm is the place a bit more from listen we're an iconic company oracle has always played we're the scrapiest company, but larry ellison -- >> they're also very tough >> i would never cross safra. >> i remember her in the people soft acquisition, netsuite is

another one, where they say we're not going to pay more, and forget it. we're not going to pay more, and they won nobody thought they would. >> they won. >> which does at least bring to mind qualcomm. we'll sew how it ends. >> we're not tendering >> and that may be the case there, though the belief was they were paying too also for and they got it. by the way now they're saying it's going well. >> it's don't fabulously mark hurd, he has a total philosophy against his enemies you know what toto is for. >> the dog from "the wizard of oz"? >> no, turn off the oxygen they let benioff got ahead, but he's toto'ing all the other

opponents. will you be on the call? >> i will be listening i won't be asking questions. >> maybe you can pass it on. >> ask him about toto. >> i will. maybe he's actually heard it. >> hurd has heard it these are three executives, by the way, they are freight trains let's quickly wrap this up. >> really? we have a lot of things. anybody else >> not enough. not enough. why not? >> because it's total re-rating. $66 billion in cash. >> how long has oracle been a value stock? how long has been it -- >> you could say arguably a decade >> that long >> yeah. you can't rate a value stock anymore. if safra is right, then she's saying it's going to accelerate here this was a triumphant called i want to say congratulations. what's with heather bellini?

what was with her not saying congratulations? she's out. she can take her way -- i was going to do a little, you know michael corleone about what happens to her now that she's not in she's out. >> right. >> she did not say congratulations. at the end of that call salve ra is saying to mark and larry what's with bellini? what's with bellini? >> don't count on the google, alphabet and the cloud and -- >> they might not see oracle coming those who have doubted ellison like i have, were really bakley, you know what we are we're simulations. >> oh, no. >> we're not real people. >> as a matter of fact i am a cartoon character. >> that i want to see. i'm a cartoon character. that's what ellison is thinking. he put me on something look nixon's enemy list. >> we're doing that now.

>> let's lee what he also did to pet, actually what adobe did to me. we're about to show you jim cramer like you have never seen before take a look. >> i'm looking at what i regard a being the eighth wonder of the world. this is some sort of device where it's actually looking at me, and it's mimicking me. >> this is not possible. oh, my god really >> we thought we would do this specially for you, jim it's a new product called character animator using artificial intelligence. we're trying to recognize your gestures, it will track you in real time. we've only done this for homer simpson, the presidential candidates and now you, because you're passionate and animated. >> it's mimic me, making me into a walt disney. he can create my own drawings and movies

fabulous stuff. >> that's a million drawings at one time this is now available to everyone they're going to make it available. it's video david, how many drawings would that have been in the 1930s for disney it uses an nvidia chip, it's real time. >> look at that. >> no, that was just f5. f6 is a water, and it's real time david, this is what the world will come to we will all be able to do this real-time at the animation, astock is going to go so much higher ashanti oryan is a genius, and this is the eighth wonder of the wobbled. we are now all able to create cartoons i just can't believe it. that was me. i was rolling my eyes. >> how do i do it? real time. >> it just watches you. >> what's it

>> artificial -- it's the adobe sensei it read your lips and translates it instantly not even like a gap time it's -- sometimes, david, we need to be astonished by what silicon valley can create besides money. >> so it's possible you'll do the show as a cartoon? >> this is what ellison would do, and i don't know, he would turn off the oxygen. >> your head would explode. >> i wasn't bad. i said that benioff was doing better anybody who says they're doing better, they're on a list, and you do not want to be on that list. speaking of hostility. when we return we're going to talk about qatar airways expressing an interest in a large, large stake in american

airlines american didn't seem too happy about it. the bigger due abu for a u.s. telecom in 19 years, altice. and we'll be interviewing the ceo. >> if you want to be a video, it's on my twitter file right know tut top david, i need -- i am not a simulation i'm a cartoon. you heard it here first. more on "squawk on the street" after this

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the carrier says qatar has indicated an interesting acquiring as much as 10% of american and the propose investment was unsolicited it's a strange statement here. they say the ceos did speak, jim, and qatar said they thought they would purchase at least $808 million of the stock, and

in a conversation between the two initiated by the qatar airways ceo also indicated they have an interest in acquiring as much as 10%. american is sort of making it clear, they have no interest in soliciting this. >> none. >> they don't seem particularly pleased about it, and they say it would no way change the board composition governians management, strategic direction, and point out that foreign ownership laws limit it, and if you were to pass 4.75%, you need advance approval from the board. >> they're not going to get it the pilots are against it already. >> what? what is this i don't know what to make of this frankly. >> parker has been the most outspoken about the unlevel playing field, really just accusing united arab emirates, we had them on recently, about

playing unfair, they used a power grab to get gates. this is one of the oddest story i have seen. this is oil and water. they do not mix. >> it is really odd. but i don't know anybody at qatar airways to understand their rationale. >> this is the new thing, david, you immediately say, i create a million jobs, united arab emirate world trade center are were saying a million jobs we need to hear from doug parker, and he's outspoken. >> he is typically not afraid of speaking his mind. if you're out there, we're happy to take a call. >> where is doug i'm priced he hasn't e-mailed us hey, look, there's the guy who won't talk to me either, it's patrick drahi he founded altice. >> i'll have a talk with him.

>> would love to sit down with patrick drahi, all the different ways they've significantly expanded free cash flow. that's an important guy right there when it comes to around the world quad plays that's what they have in europe. the quad play. >> he's going to sit down. all right. drahi, we'll see if we can get he e weavthopening bell and mad dash as well stay with us g 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.

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mad dash it's a surprise. >> i'm doing calvin klein, but listen matthew boss -- yesterday did you notice nike was up a dollar because they were talking about frater nicing with amazon? no one even talks about that, the magic of amazon almost brushes out the greatness of nikes? david we are eventually going to see a bifur cases of the companies who do badly under amazon and the company that is do well. this is one of them. i'm getting tired -- they have big european exposure. i am getting tired of the -- of everyone being run over on the tracks by some pvh is a winner. >> why >> because they have already learned how to sell in the channel. can we say -- not everyone is road kill. >> they don't cannibalize the

sales out of stores. >> they have really kind of shifted. the amazon road kill story, it's many empire strikes back amazon, walmart is demanding you get off -- >> that was fascinating, get off the amazon cloud if you want our business at walmart. i am telling you amazon web services better not get too cocky. azure is doing really well who else doesn't like me -- >> oh, please, everyone likes you. i'm glad we've talked a lot about cloud. it's something we have to continue to talk about. >> retail, health care moving it. we're moving closer and closer to the opening bell we'll have it st aju if you minute from now. stay with us on "squawk on the street." y business.

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there he is. the man who runs altice, coming public today, and remember those two deals? first they bought suddenlink, then they bought cablevision when operates here in the biggest metropolitan area in the country. they have about 4.9 million customers overall, jim but it's an important ipo. we're going to talk to dexter goya, who is the head of altice usa, but drahi runs a far larger empire, driven to a certainly extent by debt and significant cost-cutting, likes young people, not a lot of old people hypinging around. >> is that true? >> that's what he said. >> remember mike white, he's surrounded by young people

>> whoa, what is that? >> i don't really know a spirited opening we should talk maybe about hain celestial. >> key operator, they're french, don't worry, though, they are still french and we'll speak to dexter goya. >> over at the nasdaq, the emily k foundation coach k was a guest earlier this morning. we want to start with hain celestial. it's a company you know well, under a cloud because of restatements. >> they're out of the collude. >> and they always did say,

listen, there was nothing really material, and the accounting review is complete they have the blessing, and they have a forecast here of 4% to 6% growth for 2018. that's not what i hoped for. i wanted more, but the fact is once you're out from the cloud, you can do more and they really are not that concerned about this blowout amazon to buy whole foods, you could argue it my even be good for them. congratulations to irwin and his team for getting out of the penalty box, and i think they will be back. >> you do believe they'll be a growth company again >> i do. the number are not particularly good. >> no, they're not i think you're paying 30 times earnings, which had irwin been on "mad money",i would have asked about that, but he's not coming on "mad money." he's coming on, what, squawk on here. >> "squawk on the street." >> he's not coming on "mad money", he's coming on another

show he's not on "mad money." >> you mentioned that. >> i did >> one analyst based on 20 times trail 12-month free cash flow, that bias a 5 march free cash flow yield is that okay to you? >> it's rich, but i think the fact is when you come you've had s.e.c. cloud and there's nothing wrong, the only thing to say is congratulatio congratulations, which is what bellini should have -- she happens to be a fabulous analyst. i'm just giving her a hard time. i cannot believe -- it already has a story which says the pilots say this must be stopped. david, this is one of the weirdest stories in a weird week c.a. we haven't talked about who knows whether nordstrom will still happen. let me try to get to all of those, to the extent we can.

>> i threw you off there aal, what i would love to hear is from qatar airways they won't have any power hoar whatsoever. >> but it's a shot off the bow >> not some mention the 4.75% element that american has in terms of at least getting approval from the board, so very odd, had the stock up a bit more in the premarket, but it is still higher this morning. >> you know, i question -- look, it's an obvious story, but they're not going to buy all that they said i do say that of the stories and the mergers and the money that's coming into the market, it's the one that makes the least sense to me. >> right right. >> it makes no sense to me at all. >> as for the ones you asked about. on nordstrom, i can tell you that i think the family is moving ahead with deliberate speed of finding the private equity partner they feel will be right to try to make a bit the special committee of the

board is together, they have their advisers, the investment bachbl, layers, outside pr firm, so they're ready to go we'll see what the number looks like if they come with it from the nordstrom family of course, remember they over roughly -- >> i was wondering if -- this stock is cheap the reason i brought it much is a company that's been completely amazon is staples. nordstrom hasn't been totally amazoned if you have -- you may have to buy nordstrom. >> private equity, there was that deal the other day pam ploma bought. >> it's a contract research organization and private equity beat it out. >> beat out lapcorp, and another

strategic bidder >> quinn tiles did very well for private equity, which is usually quincy jones, so i think that maybe pam ploma thought -- >> i raw that point, because in the case of staples, a reporting from roy irs, i have no idea of what's going on. they say sycamore is interested and -- >> sycamore bought nine web. >> close to deal, again this is reuters, private equity firm, in advance talks to acquire staples in a deal tacked top 6 bil >> does this not say that the amazon threat -- they've made good acquisitions, some people must think the amazon threat is overdone, or nordstrom couldn't have been approached staples wouldn't, there's people taking a longer-term view. some say longer term, they're

trade, but describe them, david. i think people -- sycamore does real vigorous work though some of them that made mistakes. >> listen, to broughtly private equity is obviously under some pressure to buy things, to the extend of raise a fund, up to deploy the capital at the same time i hear that valuationses are fairly rich >> wow, so you have seen a lot of exits, haven't seen quite as many entrants. >> the love affair right now is with -- it's with biotech. it just doesn't stop at interest rates go down, the money flows into biotech it's extraordinary health care is so loved. j & j is up. we have to point these out, because not everything is

nvidia i had to name my dog nvidia, because it's a powerful concept. >> i learned that while i was in detroit. other -- i named my other dog chevron, because he's such a loser. the dog doesn't love me. thee kicking it when it's down. >> let's talk about oil, because i have a wrap. about 42.70. give me the wrap. >> i went to my best rusty brazil he runs rbn energy.com, around for 30 years he said the media percentage in to 17 oil production hedged by 37 significant u.s. oil producers. bloomberg report he's reporting. soared to 46%. at the end of 32 of 37 had 2017 hedges what does this mean? they sold so many above-50, the

futures that they have cash flow coming in all the time, which means you may think they're going to stop and the saudis certain thought they would stop, but because they sold so much futures, put the cap on oil, they sold so much forward, they have the money, so they're not going to stop as people thought they would that means that they can the rig count tomorrow may not show much decline of growth, which is why it's so hard to stop the price of oil right here. >> dodds that note yesterday i think this was yesterday, say ge shouldn't do the deal, just pay the break fee? >> ge. a new ceo is coming in there, david. >> it's under pressure as well >> look caterpillar, emerson both said great things about orders, but people feel they're too related to oil, so yesterday it got slugged wouldn't be surprised if it got slugged again. it's so linked with oil.

anything linked with oil is being amazoned >> we talked about the benefits to the consumer of lower gasoline prices. >> the market doesn't understand that. >> is that simply not something that ever came to fruition >> it should be. >> was it a figment of our imaginations >> carnival cruise had a good quarter, the stock is not up, but there will be more driving there will be more travel. that segment of the economy is doing quite well there's been no what i would regard as being typical elasticity these new cars, they just burn much less fuel, but i think there's a step up in demand, but it's not going to be enough to be able to keep out going back to 50. >> you don't see it going back to 50. >> it's going to be hard unless a compute lee lickia comes back off-line one of -- or the saudis have to

say, listen, we're drawing a proverbial line in the sand and we're going to cut production by another million. >> but they shouldn't. thee tremendousing to reform their economy. by the way, david, on hain, coming back down i think the question is how many -- don't forget kroger does business, david, everyone is under pressure now she has not been under pressure, because she has great turns at her stores. she's done quite well, doesn't get the recognition i think she deserves

oracle shares, by the way, you want about 9.5%. >> oh, my god, amazon is down. >> the largest single-day trading. >> amd, amazon, nvidia is down, i don't know, it's taking the oxygens out of the room. >> what are you hearing? >> nothing >> nothing other than there are those who believe, mark cuban amongst them some time back, that there are value there. the platform -- the question is how are you going to actually harness it >> with artificial intelligence. >> data is everything. that's what jack maw was talking about. >> just step aside from yourself for a second tell me how heroic a figure he is. >> he's an interesting man

he's not afraid to position the company that he still presides over he doesn't run it day to day. >> but he has a vision of a larger pie for the world. >> he's a good ambassador for peace and love. >> he's communism with a human face. >> i guess so. >> remember that he's very communal the peasants are like a bag of potatoes remember, i took seven courses in communism in harvard, because that was the prevailing ethos. seven courses in commune im, and one in american government that's all they offered. i took a whole course on angles. i would have rather had a course on -- >> is bob pisani ready let's get to him we've got the altice ipo about ready to go, bob. >> we were just talking here

they have 1200 employees from altice here. it's always nice to talk and see what's going on. i just want to remind everyone we are talking about, what, 46 million shares > . that's the dutch capable company, fourth largest capable provider i want to highlight the float. maybe this is not a new low, but typically the billing story, trying to float 10 to 15%, so you limit the amount of shares, 8% for a nearly $2 bill quote-unquote offer. that's a very small float. i don't have any indications for you yet. the value is in the broadband. you still need broadband, and

they've got that that's why there's a lot of interest in this stock another ipo, right over here, this is a reit it's a commercial reit, and they a acquire ground leases, they own land underlying commercial real estate, and then get a ground lease to the companies that are actually developing the properties, which are in charge of taking care of everything essentially. keep an eye in that as the yield play, indications are 18 to 19 the company went public at 20. we're rat biotech and semiconductors, so health care is strong, biotech is on fire. nothing happening in in, all week we've been talking about it even with oil up, we have new

lows today just show you the shenzhen stock overnight. there's two sessions, and it kind of drooped later in the afternoon in the prior session, and this is where a lot of the tech-heavy names, sort of like the nasdaq, two issues are going on number one, there's some discussions, rumors out there of some the bank regulators, this is h & a wanda being scrutinized for their m & a activity there a second issue is regulators have reportedly shut down the video services for not having proper licenses, but look at some of these video service stocks weibo is trading down

yy also has, and momo, the speculation is these are all live video piece that is go out that users can post, an the regulators can't figure out how to regulate it, because it just goes out that is the speculation going on among china internet watchers. we'll keep an eye on that and let you know what else is going on the important thing china is moving all week right now i'm still waiting for altice to open and of course david will be talking to the ceo verse soon, of course, along with jim. right now the dow is flat. tang you, bob. still looking for chairman wu, by the way, who was detained a couple weeks ago not sure of his whereabouts. asked jack maw about it, he didn't know where the chairman was. we'll see where he turns up. rick

>> good morning, david you know, as you look as an intraday of 10s, i see 133, for twos down two. you see on that chart down two pretty much a parallel shift it means there's no wiggles. it's constant as yields move lower. we're two down on 10s, fro higher the low clout for the year is around 212 on that month-to-day chart, you notice the drift to tens look at the same chart with the dollar index it is definitely doing better. granted it's basically unchanged today and didn't garner a big jump yesterday, but for the most part june has been pretty good remember it closed at 102.20, so it has 4% plus to make up. we like to look at our yield curve. what i like more is debating

exactly why it's flat. which channel going in, is it the english channel? it the relative pressure of all sovereigns being lower i'm sure that's a big channel, but benchmarked against those of inflation and how it's handy capping growth also figure in. if you look at our curve, roughly hovering around 80, 8 is, last week the low going back to september, which was 79 but let's look at the euro curve, shall we? the bund minus their 2s hovering an 87 basis poise, virtually the flattest, say, going back to november is the point is the separation isn't much different even thor they're like mineius 612 basis points jim and david, back to you. thank you very much, mr. an telli. we are looking for an opening trade here at the big board. we'll bring that to you once that happens, and a live interview with the ceo, which is

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all right. we're waiting for altice usa to open, 1.9 billion was raised, priced at $30. we'll see where it opens largest us telecom initial offering in 17 years jpmorgan, morgan stanley, wele uerits,nder a 'll talk to dec.e goya stock trading is coming up with jim. i should take a closer look at geico... geico can help with way more than car insurance. boats, homes, motorcycles... even umbrella coverage. this guy's gonna wish he brought his umbrella. fire at will! how'd you know the guy's name is will?

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all right. unfortunately when we get to stock trading it means the end of our hour is approaching. >> i want to hear what american had to say today carnival cruise reported -- i guess people are sort of yawning that it was another unbelievably good quart quarter. david, bookings and type -- going back with my friend matt horry, who writing with me, 2019

is the first real bookings you can get. this is amazing. oil being down is huge for them. they use bunker fuel, so you may want to buy carnival cruise if it comes down. that's part -- when i spoke with arnold, he made it clear, people like to take pictures and post it on their instagram. david, you know that that is the large -- so i like the cruise line that is a little nutty. >> i know one of your guests tonight on mom is irene rosin feld. >> yes, a very big get in our industry. >> they make mall omars. >> and when we talk about theius or i don't candy bar, which is selling like hot cakes, i guess hot cakes not being as good, and we're going to talk to yext. i'm going to reveal the real

winner in the casa amigos purchase by diageo >> isn't he the real winner? that guy never stops winning. >> he was very nice to me about a movie he made that was somewhat -- he was very nice he played you in the movies. >> well, my father would have loved that. >> i liked that. >> evenif i was the villain. >> you actually ended up okay. my wife said no. my wife said, no, we're not going to get that, because it could be upsetting. i'll sew you tomorrow if not sooner. >> you go thite , partner. coming up, the debut, keep it right here. at fidelity, trades are now just $4.95.

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♪ everybody ♪ everybody ♪ let's get to it ♪ get stupid ♪ ♪ let's get it started good morning kelly evans joins us. >> i love this song. it's a good one. >> we played it just for you carl is off today.

let's look at the mark, sort of a mixed to flattish picture. the nasdaq interestingly underperforming. it was doing better in the futures market oil appears to be stabilizing, just be low $43 a barrel we'll see if that holds. let's get to our road map. it starts with another big day in washington, d.c., tech ceos and investors are meeting at the white house. senators are wrapping up their meeting over the draft of the health care bill we'll bring you the latest. >> plus american airlines surgic as qatar airways discloses it's interested in acquire a large stake in that company. we have the details straight ahead. it's the largest public debut for a u.s. telecom company in 17 years. altice getting ready to go public we'll speak with the ceo about you first a ton of news to get to out of washington

this hour. ceos and vettors are meeting at the white house and now senators are leaving a meeting over the draft of their health care bill, which is expected to be released in an hour eamon javers is outside the white house, kayla tausche is on capitol hill first to eamon for an update on this tech meeting. >> reporter: good morn, it is drone day, that's one of the issues they'll be talking about during a series of technology meetings here today. i am told unfortunately be will not see the president of the united states flying a drone they'll do a demo in the east room with some of the equipment. we have seen some of the ceos arriving, crying is the ceo of revolution, steve case, jeff immelt, randall stevenson, the ceo of honey will, exel energy link, verizon, all walking in on 17th street earlier today.

they're in for an all-day series of discussions starting with the drones, they'll be talking about regulation, technology and safety with the growing drone industry in this country also on digital wireless talking about the future of connected devices and the enter net of things and on the financing of staffordups, how to extend, important to the trump administration to broaden out beyond just silicon valley, have that financing go to startups around the country in other locations. they'll be talking about ideas around that, and i am told, guys, there will be an industrial drone in the east room with the president, but it won't fly and the president won't fly it, but we will see pictures of him with the drones later on this morning. >> that should be different. eamon, thank you. we'll talk to one of the those vc investors in the room kayla has an update. >> reporter: i've just gotten wort of some of the core tenets

of who will be in the senate health care bill it's been described as a modification of the bill that the house put forth just a couple months ago i have learned that the senate will propose to cover the payments that they had previously allocated to go to insurers to offset the cost of offering those plans the senate will seem to do this through an proposing, which is pretty big new, it's not only something that -- but the president specifically as well other points of note, the bill is expected to -- and structure its tax credit based on the income instead of on their alge. it plans to phase out an expansion and will shift the cost breakdown of that medicate expansion. currently the federal government pays about 90% of the medicaid plans. that will shift to roughly 57%,

depending on the different states, but that is the rough appropriation of exactly what that cost breakdown will be, about 57%. finally the expectations is that the white house will come out and support this bill. there was some question after the president had said the bill needed to be more generous, more heart, less mean in the house bill, but i am told the president and the white house are expected to not only support though, but to be in support of making toss controversial payments to insurers we'll let you know as soon as we have more. sara, back to you. >> by the way, kayla, if i could jump in here, it's interesting you're talking about this. i was looking a the some of the big insurers for some reaction, i wonder if this validates more the lack of response the shares did not really sell off that much. maybe a question is what what

that does to shore up their bottom lines as they still try to land navy gait the landscape. >> we'll have to wait and see how the senate language treats this an appropriation is part of a budget they will have to revisit this on a regular basis, but this is notable how they're choosing on do it. house republicans had sued the white house over these payments, because there was not an appropriation. the white house said they would make the payments through the summer and they were cited as one of the reasons that anthem, for instance, pulled out of ohio, so this is very rural, especially in the near term and especially for the 2018 plans. we showed there humana, unitedheld, all at all-time highs. we have some breaking news to get to on deutsche bank wilford frost joins us with more. >> david, yes indeed, a her seen by cnbc five democratic members of congress have written to

deutsche bank to reiterate their deup and down. their original letter wassent on may the 23rd. deutsche bank responded on june 8th, saying, quote, federal law requires a financial institution such as deutsche bank maintain that i privacy of customers. however, this her today from the members of congress disputes that in three main ways. firstly the law that is deutsche bank refers to only relate to requests from, quote, governmental authorities, not the legislative braj two, that they add that a number of our requests do not require the furnishings of information, i.e. deutsche bank should be replying to some of the requests immediately regardless of this dispute and third, president trump can grant full access to this information and given that in the past he has repeated

assertions he does not have tie toss russia, that dour would ostensibly be in his benefit they only referred us to their original june 8th response, available on their website, so the company not yet commented on today's latest congressional letter when we come back, qatar airways is compressing interesting in buys a large stage of american airlines plus altice raises more money than any other u.s. list the telecom company. the ceo dexter goei will join us ♪ i'm living that yacht life life life life ♪ top speed fifty knots life ♪ on the caribbean seas

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let's get to phil lebeau the first -- my first reaction is do this actually happen and, you know, how would u.s. regulators do it inch the weird deal of the day that has people on wall street and the airline industry scratching their heads, first of all qatar airways can buy up to

4.75 shares of american airlines it has indicated in a conversation initiated about by the co of qatar airways that it intends to buy up to 10%, but the board would need to approve qatar buys anything more than 4.75%. there has been a conversation between al backer and doug parker foreign companies, by the way are not allowed to own more than 24.9% of any u.s. airline. keep in mind that doug parker has an extremely vocal critic of the persian gulf carriers. it's clear that american doesn't plan to change its stance. it says american airlines continuic to believe the president amend his administration will stand up for foreign governments to end massive carrier subsidies that

threaten the aviation industry and threaten american jobs shares of american have moved higher, but get len met stress, doug parker may be the most vocal critic, and how it's her the u.s. carriers not only with their action to the middle east, as well as now their flights over to europe we haven't heard more other than this from the company, curies if we'll hear something regarding this investment from qatar >> the only thing i have heard not directly from parker, they don't know why i asked that question earlier, and the response is we don't know why, either. >> correct. >> the only thing they can speculate on qatar airways owns 20% of iag which controls british, and aer

ling lingus maybe they just like to own large stakes in they global airlines let's play devil's advocate. is that really the best play for them to get a return on $800 million? is it really to buy a stake in american if that's their feeling, fantastic, but i think doug parker will have strong words, this does not change the comp position of the board nor its governance it's not like they're letting qatar in and saying have a seal at the table >> fill, thank you we'll be watching this we're one today for sure. we're also keeping track of big news where ceos and

investors are meeting at the white house and gop health care bill is expected to be released. here at post 9 to discuss all of it, cnbc senior contributor larry udlow. >> breaking news, breaking news the senate health care draft are solid. >> i've seen chunking. other moles were reading chunks of it. solid means, a, it's better than the house. >> what does "better" mean >> how about the income versus the age subsidies? >> in the senate bill, the subsidies, the stacks credits, refundable tax credits, instead of giving rich people a flat tax, which is what the house did, they're going down, going down to the working poor i have watched this for so darn

long there would be means testing and -- they're borrowing from the main -- state of maine model. you all go in the same pool. not sara, sara will never be old enough ss ssed actually healthy people will be separate from the preconditioned ill the precondition will be covered, but it's going to be a separate risk pool, even though you may not know it. very clever. so that means with the essential ben fizz man dade basically gutted by the states, premiums can fall this is actually very clever

stuff. >> and they're subsidizing the higher-risk pools, right >> they're going to get tax credits. my point is the tax credits sliding scale is going lower, which is what many of us wantedd >> is lisa murkowski on board with this? >> i don't know. >> our susan coal independents. >> these are my friends. i don't know why it is the moderates have always liked me i can't quite figure it out. >> a you are a very kind man even if you are wait out there in right-land. >> the whole point of this is the essential benefits will be pared back in most states. the so-called working for preconditions will remain, but you may not know that you're separated out into a separate pool

rate are really all of that is better to the house bill >> 5 -- so nicely above. -- by the french altice, which will still corrosion the vast majority larry, continue. >> now, i think it's going to get through the house. i really do. there will be nix and nabs it will get through the house. here's what i don't think. here's what i think i don't like

the house bill, yes, then it goes back to the house -- i'm sorry, the senate bill i beg your pardon. then it goes back to the house for a conference i don't think that conference is going to be hard okay here's what's hard i found that a very disturbing thing yesterday. the house leadership, paul ryan, working with white house people want a closed conference for tax reform you can't have it closed that was the problem with health care in the house. they wouldn't let the freedom caucus in. they want to do it behind closed doors you. >> that's what they've been doing in the senate. >> so, it's wide open, because you have these working groups with ted cruz and lamar alexander, and mitch mcconnell was blessing it.

everybody knew what they were doing. they want a very small amount of people to work on tax reform. >> but at least the health care bill, larry, you're right, but it gets done you needed that to go first. >> i don't want it done. i do want it -- i don't want health care done alone the steve moore kudlow, et cetera, at least easy pieces you can't get an omnibus reform on taxes between now and the end of the year. it cannot be done. it's not enough time it's a maul year project listen to what i'm saying, this is doable. you've got support in the west wing on this three easy pieces the well word is in favor. repatriation, low -- everyone's in favor of that

so break it off, put it -- hang on, hold on to your seats. put it -- put the three easy pieces into the health care reconciliation bill. right in in july they will not have a summer vacation this year we're not. >> are you sure? >> i don't care. we've got mark meadows of the freedom caucus, steve moore and i had lynch, how about this? they don't go home until they get it done. legally technically you take your health care products and attach it to the corporate product, which is the growth kicker one reconciliation. >> house speaker paul ryan still is talking about major tax overhaul and transformation by the end of the year. >> you are absolutely correct. my question is, is he talking to

anybody besides himself? that's really the question i need to no i've got to tell you, you talk to hill staff, members, it can't be done by september there's only a handful of legislative calendar days. you give me 25 more days in august, so they work -- you work in all, you work in august, we're all working in august. let them work in august. >> that's easy for us to say we'll see if it happens. >> let them work, if they do they'll get to three easy pieces large and small, that's where the growth kicker is, that's where the productivity is, that's where the wages are, attach it to the health care reconciliation for 2017. just do it the most important guy in this process is the president of the senate >> okay. >> mike pence. >> correct the important 51st vote, if they

need it. >> the senate parliamentarien, her name is elizabeth mcloughlin you don't have to fire her mike pence, the top official in the senate just says no, we're going to do it this way, it's legal. so i want big bang, grand slam home run i want business tax cuts, health care in the same big, and then if they gless that done, we'll let them go to camp for the last week. >> they do listen to you sometimes. >> well, i just want to tell you this, as outrageous as this idea was three weeks ago, it's gaining adherence. i've got at least one very senior guy in the west wing and we're working on more. i have the house free tom caucus, senators, we're working

on this. >> keep us posted, larry, as always. >> thank you. when we come back, the latest from the ceo investor meeting at the white house new enterprise associates managing general partner is taking parity in the discussion. he'll be joining us next, and altice usa just started trading here, ticker atus. we'll talk to the ceo next right here on "squawk on the street. right away, it was a success. i mean, it really took off. what people don't know is that it all started with points from my chase ink card. i bought the ingredients, utensils, even custom donut cutters. wow! all with 80,000 points. what will you create with your points? learn more about the ink business preferred card. welcome to holiday inn! ♪ ♪

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altice usa is officially open for trading the stock up almost over 7% in the years old trading dexter goei has been with us before >> good morning, david. >> when you bought suddenlink, a couple other announcements big day for you today. why duck at a time this company public >> we always said we had things we wanted to go in the nest couple years investment in the network, and also have a currency out that

there we could validate the worth i think that means if we have the opportunity to buy other stuff. >> like what what else is for sale that i have gut you scale >> i think or overall job is to be ready not in any hurry to do anything we have a lot of operational work to do a lot of big, big projects for fiber for the home and one communications hub we need to be prepared that's why woe went public. >> you -- pay down debt?

>> some. altice overall, you have a quad play in europe. wireless is part of that is that part of what's on your shopping list? do you see that as an opportunity? >> i don't think so. not today. again our priors is on operational focus and ke projects we have in place right now. so we'll see wireless is not a focus for us today. i think fixing our network, improving or network, improving our customer service, improving all the entire customer experience is really critical. >> we talked about in the past, you guys have ambitious goals for taking cap ex down, but delivering a better product. >> that's right. we believe we can take the same amount of money we've been spending, reinvest it in better products as abouter prices. >> we talk a lot about the changing world of cable, so to

speak, a lot of people cutting vitt no. how does your mod many looks is it bad or is it good to be a broadband-only company where he investing heavily into content. we're very focused on rolling out a state of the art user interface, very intuitive, very much like our friends over at comcast have so we are investing, we think it's cry tal that our customers have a great product. >> if i'm the cablevision customer and i have optimum, i know many people are saying why am i paying for video? i use my house only x number of days. >> if you control the entire user experience and offer the different types of video available through your set-top

box, we they we'll maintain a good business. we think we're underpenetrated >> what about programming costs? you recently -- i can remember having discussions with you about suddenlink which dropped viacom, and now they're back. >> absolutely. >> why are they back that plays into my question about programmingcosts which seem to go up. why would you do a deal with viacom if you didn't need them >> we obviously believe that viacom has great content they've been great for us here at optimum we've been able to find a long-term transaction that works for both sides. >> how did it work for both sides? >> that's the devil in the details, david, but we fundamentally came to an agreement. they've been fantastic partners and we look forward to working with them for a long times. >> kelly may have a question.

>> i it's it's fascinating it's quite clear this whole industry is being shaped how important is spectrum for you guys is that the most important thing to have right now? and the white house today they're talking about 5g we've talked about this before, maybe i can get a youtube plan, but maybe you can't go ahead wireless to buy it up, but you still need spectrum. so i think toe end of the day you still need fiber we're focused on continuing our network to have fiber everywhere spectrum may be in local communities where we could think about doing certain things, but it's not a prior for you today we're focused on continuing to improve our fixed-line network

so having spectrum -- >> it does, but 5g is considered to be a threat eventually. you could have a mobile broadband product into the home better than wifi how do you view that threat evolving >> listen, we are one big telecoms community both wireless and fixed. at the end of the day those delivering 5g will have to have a fixed-line off-load for data, so we look forward working with the wireless providers and developing 5g with them. and is it on free cash flow? or are you going to have revenue growth >> the only thing that pays the revenue is free cash flow. we keep the lights on, so we're big believer in focusing on free cash flow. the rest is just accounting in many respects, so very, very

focused on free cash flow. all right. we'll be staying tuned at always thank you. >> good seeing you. >> chairman of the newly public altice usa. great stuff. contessa brewer for an update. >> here's what's happening right now. tropical storm cindy made landfall early this morning bringing fierce wind and heavy rain and take a look at what some tourists saw on santa rosa island a funnel cloud building. theresa may addressed parliament on the deadly apartment fire that happened last week. she said the cladding used contained combustible material. >> the house should be careful on speculating, but as a precaution the government has arranged to on test cladding shortly before i came i've been

nfl that a number of tests have come back as combustible. tom brady promoting $99 pajamas in tokyo today the company cease it helps your body recover faster and promotes better sleep that's our cnbc update for this hour, back to you, sara. yeah, not into spending that much on pajamas. contessa, thank you. jackie deaingely has the numbers. is. >> initially a beachish rear action, but we're seeing surprises supported. this is a bit above the expectation, but still below the five-year average. why i think we're seeing support is remember we backed off that $3 level, above that level and now we're seeing a bit of a supplied/demand rebalance, if you will that would be key as we go

forward. part of this is a weather outlook as well. on the east coast we've had a bit cooler temperatures, intermittent rain, that brings the demand down, you may see that in parts of the country that will impact the nat gas trade. those are the technical levels that recent range that trader are watching we're probably going to stay in there. back over to you >> jackie, thank you taking a look at stocks as we head to break heap it's -- by health care, and centering actually after a rough few sessions pretty much unchanged. e ag estate and financials are quk on the street" will be right back confirmed. they're playing. -what? -we gotta go. -where? -san francisco. -when? -friday. we gotta go. [ tires screech ] any airline. any hotel. any time. go where you want, when you want with no blackout dates.

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it is president trump's tech summit, the white house hosting ceos among the discussion topics today 5g wireless and drone

technology joining us from the white house is someone who's been inside the meetings, peter barris managing partner, thank you for stepping out in between sessions, what can you tell us about what was discussed so far >> we had a great session, actually i was in the roundtable discussion financing and emerging technologies. we covered a lot of ground i think what i saw was people were listening, engaged, and i thought we had a very constructive discussion. >> specifically on the tax code, what points did you and other men of the industry make >> well, we talked about things related to aggregating capital, so outside of silicon valley, new york and boston, what we

could do to -- we're in a sim wait where technology allowed people to --, so we talked about different regulations and 340dicses of the tax code we thought would encourage that the new head of the fcc was there. any lobbying for frepdly regulation >> yeah, there was a lot of lobbying going on for friendly regulation i was pleasantly surprised at the receptive is we got into areas that weren't really core to our topic area, but things like immigration, visa programs, things like that he shared with us how the white house was thinking about it, and

it matched what we were thinking about, in terms of attracting skills, encouraging immigrants with skills to fill the many unfilled jobs that we have in this country and skilled positions. >> are you talking about increasings h 1 b program? is the white house thinking about that >> we talked about modifications to the h 1 b visa. >> i'm looking at some of your investments in the past. everybody from groupon to i think goop today is supposed to be about drone technology and 5g. anything you're looking at ought because we're here on the large end of the scale we participate in every -- spending -- two thirds of our

dollars, and drone technology is part of that you see i've been in this business for 25 years, i don't think i've seen a richer environment than the one we have today. >> some people were skeptical about technology executives, coming to washington thereon have been points of friction between this administration and members of silicon valley did you have any qualms about going to the white house today >> look, this isn't about politics, frankly. we're as a firm we represent about 5% of the capital in the venture industry the venture industry represents all net job growth in the past 30 years, so it's important to have a seat at the table, and we welcome that opportunities.

>> thank you for joining us to share some of those discussions. >> thank you let's get to phil lebeau we have more news involves qatar airways, which hopes to make a large investment in american airlines. >> we have a statement from qatar airways, it is first one since the a-comment filing by modern indicating it had been notified by qatar. qatar airways say it sees a strong investment opportunity in american airlines. it intends to build a passive position in the company with no involvement in management, operations or governance david, i want to touch on something this has floelting around on twitter, look, they could be code share partners if qatar takes a stake, that would give them access to increase the flights, given the problems they're running into

that's not the way it works. code share agreements are reached between airlines, and given the feelings that american has regarding qatar, i would be stunned if they said, sure, let's reach a code share agreement here, given the fact we think these airlines go ahead a massive subsidy. still waiting to hear from american's ceo doug parker. >> they do say they have long considered american a good allyian partner, what do you make of that >> it would be a good allyian partner when you look at global airlines, american is at the top of the list if you're another airline looking to partner up, through a codeshare agreement or some type of alliance, but it takes two to tango

doug parker does not want to tango with these guys. >> what did cramer say oil and water. as we head to break, look at shares of hain celestial, showing the long-delayed function results maid no materials changes, it found no evidence of intentional wrongdoing and put out a lot to chew on. we will speak to the ceo of hain cestl clleiaexusively, coming up on "squawk alley." stay with us [vo] when it comes to investing, looking from a fresh perspective can make all the difference. it can provide what we call an unlock: a realization that often reveals a better path forward. at wells fargo, it's our expertise in finding this kind of insight that has lead us to become one of the largest investment and wealth management firms in the country. discover how we can help find your unlock.

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welcome back, the public can now read the senate health care bill ourselves this is the draft, 140 pages to get through. the early outlines focus on some of the differences between the house bill when it comes to offering, for example income-based refundable tax

credits, as larry kudlow alluded to ma segments higher-risk populations into the pools a lot of questions the bill will need to address, about the essential benefits mandates go, and, of course, medicaid, probably one of the most important issues for the ten senators, at least that will need to be watched to see if this thing can pass, anybody from alaska, senators, extremely focused on what impact it will have on state budgets. as we mentioned earlier, three of the hell insurers, and kayla was reporting on this though they're going to fund some of the aca, you know, restores the aca funding, humana, and all trading around all-time highs. >> i think the big headline is that it cuts medicaid, it limits federal outlays to state

programs, an also reduces the taxes to 89 wealthy, which is another political talking point. we need to wait for a cba score, which will be political charged, and again the we're going to look through the details of this and get the income. >> the train is moving again it goes tolt whole agenda question if they can get this going and then the tax issue and they can bundle them altogether, there is 1% on the back of. this let's head over to the cme group now, rick santelli with the santelli exchange this morning. rick >> thank you, kelly. i'd like to welcome my guest richard farr in one of your most recent writings and i'm paraphrasing here, worry about down side risk you tell investors stocks are you have thely at all time highs, especially if your blurry eyes. rates are a lot lower than they

were at the end of the year. the curve flattened and we have a fed tightening you see a soft patch and more risk explain. >> well, there's no doubt that some of the recent data has weakened you see that in retail sales and credit card use. you see it in the pmi dat yachlt it's been across the board, housing, for instance. the data has been a little softer meanwhile, if you look at the inflation data, it looks as though inflation may have peaked a couple of months ago so to me, it seems a little ill advised that this time for a fed to be hiking rates, i think you need to see a little bit more proof and less forecasting at this point for the fed i think that does create down side risk. >> all right okay now, i'm going to push back. let's take that soft patch you described. if i look back 15 quarters, i can find lots of quarters where we had four handles and lots of quarters where we were under two, under 1 1/2, even some negative ones.

so that's been kind of part of this, uneven inflation, one thing that is looked at is the break evens right now they're around 160, 167. if you look at the widest they've been, they were around 208 at the end of january. at that point in time, tips weren't far from the prices in yields they are now. all of the break even movement has been the down draft in tens. so what i ask you, richard, everything you say is true but are we really looking at inflation? are we looking at long end rates that are lower than they would otherwise be for central bank issues across the globe? >> well, it's funny you ask that question i happen to go to a speech by charles evans of the chicago fed on monday. and in the q&a he was asked what do you think of this amazon buying whole foods situation and does that create deflationary pressures it was as if it was an ah-ha

moment and they said that is something we have to look at maybe we need to be a little bit more accommodative going forward. and it was almost as if the fed had finally realized that inflation targeting when inflation is low may not be the best answer. so, rick, i hear you on all this stuff. i think bonds are simply reflecting the fact that oil prices have peaked on a year over year basis. they were $54 in december. that's deflationary pressure throughout the stim. >> i guess the put that altogether, they're going to look at the metrics. it is knowing what the target is before you aim for it. finally, when it comes to all the issues regarding the economy, all i can leave folks with is that legislation has a better chance today according to many you look at the gop, they're 5-0 in special elections i don't care about politics.

larry kudlow seems optimistic. real quick, we're out of time, legislation passes, that helps the case, doesn't it yes or no, richard >> not only does it help the case but we need it. yes, rick. >> awesome thank you for your time. let's go back to david >> thank you, rick rick santelli. let's send it over to jon forward. >> investors, entrepreneurs meeting with the president at the white house this morning to talk about tech innovation and growth we'll see if they talk about the start-up visa as well and a couple of big tech ceos coming up, oracle smashing it on earnings and mark heard is going to join us so don't miss that sarah? >> jon, i'll see you then at the top of the hour. i do want to hit the headlines coming out of the senate draft of the health care bill. we're just getting it. we haven't read through the 140 pages or so. some headlines to share and some movers in the market on this kelly, you mention the insurers

moving higher. just in terms of the headline there, funding for insurers continues through 2021 n. this bill interestingly some of the hospital stocks are also up and moving around to session highs on the results of this bill. other headlines i can bring you, tax cuts on the high income households and the senate health care bill are largely unchanged from the house plan. we knew that was a big political sticking point that democrats hated in the house plan. the senate draft would repeal a 3.8% net investment income tax retro active to the start of 2017 we knew that would end the aca penalties for those that don't get insurance that was the core of repealing obama care basically and as we've been talking about, would base these insurance subsidies on income covering 0 to 350% of low income households we'll continue to digest you are seeing anything else >> no, i thought you said about was the hospitals is interesting. it's like this bill and larry talked about this earlier, may

have something in it for everyone we heard the president tell members of the senate he won the bill with heart in it. this one would start phasing out medicaid more after 2020 putting the 11 million people at some risk in the meantime, it may be close enough to the status quo that the hospitals are relieved and also shows the insurers the same kind of story while giving over time a shift towards a system that would look more different from obamacare >> and i think today was also the deadline for insurers to submit the rates and plans to the states so it's an important day there there is tenant up 7%. as we head to break, a quick programming note, today at 3:00 p.m. on "closing bell," we're going to be joined by hary schwartz you don't want to miss that interview. ""squawk on the street"" will be right back

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welcome back to "squawk on the street." you can see health care certainly a focus to day given the legislation coming out of the senate people are still parsing through the 100 plus pages of the legislation or proposed legislation. still, health care sticking out as the best performing right now, the best performing sector

in the s&p 500 if you take a look at some of the heat, if you will, within that particular sector alone, some of the hospital stocks have at least positively reacted initially to some of the news coming out of washington, d.c. with, the senate health care legislation or proposed legislation. shares of tenant health care and community health, humana, hca holdings, all of those names up big here tenant health care up 7% community health up by more than that right now health care stocks overall some of the big pharmaceutical names, pfizer shares up by 1 hers hers. glaxosmithkline, bristol-myers, merk, all of those moving up as well then you have insurance names, aetna, anthem, cigna, wellcare, many of them hitting record highs or around record highs so far in trading to day. they're certainly a focus as well we know that so far this week to date health care has been the best performing sector driven a lot by the biotech side of things you put together the senate health care proposed l