and foreign exchange markets and we're watching so closely after these comments and you would expect based on what they're saying that they're going to take foreign exchange into account and things got tighter in terms of liquidity that you would see a pull back. >> we'll turn it over to squawk on the street. we'll see you back here tomorrow >> good thursday morning, welcome to squawk on the street at post 9 of the new york stock exchange stocks try to price in big uncertainties. hurricane irma's potential impact on plaza fflorida. the euro above 10 as draghi

speaks claims do jump to 298,000. our road map begins with cohn on the outs the president no longer considering him as the next fed chair. >> plus bracing for one of the most powerful atlantic storms ever recorded. hurricane irma is is battering puerto rico overnight. >> deal maker and chief, president trump stunning republicans making a debt and harvey funding deal with democrats. >> first up stocks are aiming for a second straight day of gains following tuesday's sell off. coming off it's 7th positive session with the energy sector posting the best day in a couple of months. trying to make some connections between irma and what it might bo dodgers the gdp and rate hikes and not to mention more stories about reinsurers and the damage they may sustain.

>> we saw an up tick in jobless claims this morning. that was expected. it's going to hover for a little while. at least on the debt ceiling front you got a little bit of clarity so you're adding and subtracting as we go along. >> talk about a big jump is the euro trading here the highs of the session right now. almost the highs seen above 120 against the dollar not really doing enough to talk down the euro which is the bigdy he -- demilema at the moment. 2.2% to 1.9% and that's the

sticking point it's buying him time to knock the talk to october 26th maybe some of the political risk in the united states and the fact that draghi isn't doing that much to talk it down although he did say it's a source of uncertainty and pushing down inflation. >> expansion does not equal inflation. he is ready to expand and increase qe if needed. this is not a hawkish conference by any means. >> they didn't change their 2018 or 19 growth estimates so it seems like the attempt is be conscious of the fact that the euro is anticipating a tighter policy and trying to push against it. >> meanwhile, tax reform amid all the crowded calendar that

congress has on harvey and potentially irma aid the president did headache his way to north dakota yesterday to talk about tax reform. treasury secretary out this morning saying end of the year is still viable. here's the president yesterday. >> this is a once in a yen ration opportunity to reform taxes, rebuild our economy and restore america's competitive edge history has proven time and time again that there is no power on earth more awesome and unstoppable than the will of the american people. you saw that on november 8th, please me. >> we'll talk more about any specifics that we may get over the next few weeks here. >> he said two weeks, again. >> he said two weeks. >> he made this two week pledge a number of times. a number of people pointed out we're still waiting on many things that have been promised in two weeks but we'll see the only real thing was that one

pager after the president surprised treasury back a number of months ago with this idea that they were coming up with a plan, they didn't have the plan then most people in the world we deal with do not expect there to be any significant move on tax cuts and or reform in 2017. that's a fair statement. at least based on what i have been hearing from the corporate world. >> now that trump made the deal with the democrats to punt the shutdown three months does that give him a window to seriously work on tax reform or does it alienate and anger some of the members of the leadership of the republican party so that they won't work with the president >> that remains unclear. there had not been any outreach across the aisle in terms of the plan the republicans had been working on and the white house

had been working onment those that believe there could now be a more bipartisan approach to tax reform they have differ views of the issue even though everyone is some what unified around the idea that we don't have it when it comes to corporations in this country and the system that he we have it's hard to marijuaimagine. >> ryan says we want america to wake up on new year's day with a new tax system and thinks that end of the year it's post player to believe get legislation passed. >> we'll see they have been deferring to the republican run committees in the house and senate to write these bills. if you're getting down to 16 on corporate and the freedom caucus wants to be revenue neutral.

>> still got to get the budget passed of course you still need it under reconciliation unless you do a bipartisan approach which would mean not a 16% rate and obviously a lot of different things although we don't know on individual other than simplifying. we haven't gotten any detail. >> the market continues to say we'll believe something when we see something. >> they'll have to decide on the debt ceiling and government shutdown and daca, on the federal reserve chairman for the president that says he's going to make that decision. >> and steve ban nonsnon sayingn was onbligated to re-sign. >> those two were very close >> hurricane irma is battering

is caribbean as the deadly storm heads toward florida >> good morning. we still have a very strong catego category 5 hurricane it's tracking to the west northwest. it's moving at 17 miles per hour wouldn't be surprised if we didn't start to see that slow down a little bit but still at least for the next two days before we see that switch to the north. look behind me here. we do have hurricane warnings for the northern parts of the dominican republic, haiti an turks and cacos and the bahamas all the islands are included now. south florida and the florida keys not in a hurricane watch at this point but wouldn't bit surprising if we do see a hurricane watch added to the florida keys as well as south florida. more updates throughout the day.

>> thank you as florida does brace for irma let's go to morgan for the latest on the preparations there. all sorts of sectors to start closing things ahead of the weekend. >> take a look behind me calm waters here in the bay. relatively clear skies it's 80 down here. hard to imagine that the worst case scenario of this storm for miami is now forecast but officials are saying this is going to be devastate sog just yesterday florida governor rick scott warned of the significant storm surge and extreme winds and went as far as to compare irma to the last category 5 hurricane we saw make land fall in florida that was andrew in 1992. you know how alarming those comments are andrew was second in terms of insured losses

$57 billion hurricane. inflation adjusted displaced 250,000 people and damaged or destroyed about 127,000 homes. it was the reason at least 6 insurers bailed and it is the reason that this florida homeowners insurance market is completely remade 25 years later so the big players all scaled back out of homeowners insurance. it's now smaller more localized companies. hci group, heritage insurance, united insurance, universal insurance holdings all of which have tumbled by double digits over the past week also a big market for reinsurance. names like evidence lest, and xl group so this is almost going to be an earnings event 3 quarter

and 4th quarter we'll see a lot from harvey alone but when does this become a capital event? experts say the industry has a lot of surplus capital on hand but if this is $100 billion or more that could change back to you. >> we'll watch those names thank you. let's go up to jackie. >> good morning. the name of the game today and tomorrow is going to be closures port everglades behind me is right now winding down it's operation although it's still running at this point. port officials telling us that they expect those operations to probably close down according to coast guard regulations sometime tomorrow this port is the number one seaport in florida in terms of revenue it's number 2 in terms

of petroleum and gas is going to be a major issue as people hunker down and try to prepare more for the storm either to stay here or get out there will probably be shortages. we do know that 30% of the station in miami, fort lauderdale and west palm are out of gas this is the number 3 cruise port as well. a lot of travellers are take multiday cruises that leave out of this port already some of the departures have been delayed or cancelled i imagine the volume on those is going to pick up as well i will make the point morgan made as well look behind me it's a beautiful day here and it's sunny it's hard to imagine that in the next two days you'll have this

catastrophic storm here but locals told me that they're taking this one very seriously they're getting out because it's rather to be safe than sorry at this point those preparations are being made and will be carried out today and tomorrow as well guys. >> thank you very much the latest on nelson peltz versus png does he think now is the time for the central bank to scale back stimulus? look at the futures on a busy thursday morning more squawk on the street continues in a moment.

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unveiled his white paper unveiling a strategy for improving procter & gamble performance. they have a 3.5 billion dollar stake in the giant he is accusing the company for settling for immediate i donmed.

>> do we have it >> wants the structure changed into three big business units. about $25 billion of revenue each just to simplify things and get the sales and marketing reporting to the actual business units. make faster decisions. also p&g needs to do a better job. all in on big brands a better m&a growth strategy and competitors that scoops up all the fast growing brands. address the insular culture. and that's that most of the top management has been with the company for their entire career. 30 or 40 years with a study why haven't they had a big hit

so a lot of fair criticisms i would say. a lot of good charts in there. p&g are shooting back and responding. >> they are. they're seeing a lot of different things we considered all of these things in the past and we don't feel that's an appropriate structure to the company this is a time when you need as many big brands as possible in terms of being able to dictate terms to a certain extent with the walmarts and or the amazons of the world there's more of the response. >> they accused him of having that plan that would be a precursor to the break up of the company. something he doesn't want to do. >> he does not although when you have a holding company structure it makes it easier to follow that kind of a plan peltz is going to keep saying why not? why not me just add me. i'll be a good voice for

shareholders they have another month to fig where you are this out given 40% of their shares are helped by retail just to thank you for your suggestio suggestions. this argument somehow that it would hurt board cohesion is a hard one to fully understand. >> that's been the constant refrain. >> their refrain, you're talking about in the past. we're not talking about things currently taking place here. these criticisms might have been more realistic recent returns as opposed to having anybody go back. >> which is better but still not good enough and growing organic

revenues at the rate of the industry which is something that p&g's history used to do the other sort of shot back from the company is why don you share this white paper earlier and i talked to nelson peltz and he offered to but the board wouldn't meet with him in full to try to understand and try to figure out the ideas and they have been resistant from day one. >> getting less classy overtime. david mcintosh on the president's deal for tax reform and more more squawk on the street continues in a moment. hey gary, what are you doing? oh hey john, i'm connecting our brains so we can share our amazing trading knowledge. that's a great idea, but why don't you just go to thinkorswim's chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders?

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making some comments at a new york times event in washington >> good morning, carl. ryan was speaking about tax reform when he was asked about president trump's deal with democrats over harvey aid, the debt ceiling and funding the government he said he understood that the president was looking for unity. >> he made it very clear he wanted this to be a bipartisan moment for the country we have to fight for these things i believe for credit markets sake we should have longer extensions of these. i don't think it's good to have these short-term credit markets. i think it's a different thing

>> the president was actually looking to clear the debt so that president trump is hooking to perhaps say additional money for border security once lawmakers pick up the spending fight once again in september. another quick point with the trump administration the white house felt they are still seeking a 15% corporate tax rate speaker ryan saying he's looking somewhere closer to the mid to low 20s and 15% will be hard to make work. >> those are important numbers to listen to thank you. we'll come back to you later today. >> a bunch of movers to get to today. >> just a few momes ayntaw

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squawk on the street live from the financial capital of the world. the opening bell is going to ring in two minutes time on this busy thursday as you watch both tax reform and the debt deal that the president has struck with democrats along with hurricane irma before the coast already with winds about 180 miles per hour on a sustained basis. home depot hasn't made a new high since may but it's going to open within about $2. >> i was a leader for so long and resisted retail but it's come back both home depot and lowe's feeling like it's going to be a comprehensive rebuild event in florida a at least could be. we'll continue to watch the airlines the insurance stocks, the cruise lines, rcl did have a tip hike of 25% but those stocks have been down for 3 consecutive days on harvey. >> yeah, you come to the

investor calculus of a cruise not taken is not made up later it's just loss of business. >> quarters are down there too. >> it's a direct hit on the core business. >> the currency and bond market continued to be interesting. the ten year yield sitting right near the lows of the year. that pummeled financial stocks in recent sessions and we continue to see 208 on the ten year yield and draghi spoke and the euro moved up. and it's between stocks and the euro it's harmful for european stocks and but in the u.s. that weaker dollar has been a boost. >> our market and assets have been a real lubricant.

i think it's a 2.5 year low. >> might be a reason you're seeing strength in futures today. let's get to the opening bell this morning down here at the big board celebrating it's listing to nyc american at the nasdaq it's celegene corporation ringing the bell keep your eye on ge as we see the market opening out with a note this morning and literally titled worse than we think. price target is 22 and investable value and the base is overly epressed. it's a complete reset. so that earnings power has to be recognized to be much lower and come down to closer than cash

production it's been the stick point. look at the stock and want to keep making the call and it's been washed out. it's been a slow loss of faith in ge it's not been this kind of panic. i mention at the lows they're talking about that dividend yield goes up toward 5%. would that really be the case. you have a structurally challenged retailer. >> you have a new ceo and conceivably everything on the table and those that talk to these people here he's willing to consider everything and did create an enormous amount of value all the time that does continue to be a question as to whether the future will hold a break nup some way

but none of it helping that stock price. >> doesn't get any credit for a huge aerospace boom. >> it doesn't get that benefit of the doubt like a 3-m get which is is well managed good businesses we can deal with the con glam rant aspect of it >> we talked about dealing with procter & gamble and you may remember the thoughts they had about ge there's a real question as to whether it will try to get on the board of directors at the company. that's been a question for

sometime gopro is great today gross margins the high end of the guide. stocks had a hard time getting and staying above 10 almost a year working on that today. >> the 4th quarter is what is always going to matter for this company so it's great that they're current quarter profitable but i still think it's about holiday sales momentum. >> speaking of, restoration hardware trading higher after a big earnings beat. comps of 7% better than analyst were looking for this year revenues beat by 2%. eps beat by 18 cents and the company raised guidance. this is a surprising good quarter. shares up 40% here it's been having a goodyear but

always concerns about the high debt load. a lot of analysts are raising their targets on restoration hardware having a better time managing invenn toirs. >> a huge debt buy back. you have a huge short squeeze on top of it. the stock still not at the highs it was at in june. >> this thing is is all over the place. you just never know. >> >> interesting comps down 4-9. looking for down 3-3 it does sort of lead you to amazon which is no longer a bookstore but they are opening a search for a second head quarters they'll spend $5 billion in that effort should be as large as seattle. a day after they say they'll build the first fulfillment

center in new york and now mkm has a note that argues it will have a $1.6 trillion valuation in 7 or 8 years which would imply a current share count at a price of 3,000 plus. >> right so the math works out to the stock is going to depreciate 15 or 20 a year but it does get you you the enormous market value it's interesting seems like it will be a sweep stakes >> shop around the tax incentives. >> to be fair when you think about how many jobs they created in seattle you can make an argument as to why they have a good case that they should get support of any municipality that they choose. it's not just the direct jobs but you attract so much other talent it creates it's own energy they really transformed downtown seattle at the head quarters

new york is in the running although our mayor is is probably clueless. >> i was talking to somebody from milwaukee they got airline routes initiatived. >> international airport >> walmart did the same for northwest arkansas in terms of flights. >> demand in the online retail sector boosted hiring in the seattle sector everything is amazon but unspoken do you know what i mean? >> exactly a large fund company in boston buying the stock. >> but they are under political pressure right now the president called out besos in a few tweets for avoiding taxes and disrupting the retail environment and costing jobs so

this whole public statement and the fact that they're shopping around may approximate an attempt to alleviate that. >> washington d.c. may be a good place i don't know. >> he does have a new mansion there doesn't he >> be besos does >> yeah. >> fireye is another story to watch. morgan stanley takes it to overweight on what they see is a meaningful adoption of their platform we have seen some of the security names. >> it's interesting. well they don't have an antidote for the stuff that we need it's not necessarily like a run rate of steady sales but this is back up there with the upgrade >> dow is up 28.

home depot is not the leader but it is the third biggest gainer on the s&p as we watch hurricane irma take focus on the coast of florida. >> there are very few who have surrendered entirely to the notion that tax reform will not happen this career especially after yesterday's three month debt ceiling extension and looking at the dow up just about 24 points following that 60 point gain we saw yesterday but take a look at the currency space that's getting a lot of attention. the euro breaking above 120. that's a new 2.5 year high against the dollar mario draghi failed to address the currency strength. so far he said currency volatility is a source of instability. remember he said in 2014 that a 10% apreesh wrags in the currency would lower inflation by 40 to 50 basis points holding on to 120 right now. let's look at stock reaction

european stocks are holding on to gains perhaps becoming immune to the volatility we are seeing in the currency space trading around a one month high as hurricane irma makes it's way to the united states there's now forecasts for irma to be the most expensive hurricane in history we're looking at home depot and lowe's higher now. there's also a discussion around hotels and say kags rentals. florida is considered the timeshare capital of the world a whole 23% of florida's vacation resorts offer some type of timeshare ownership for a total annual sales volume of $2.4 billion hilton grand vacations, marriott vacations worldwide, just some of the timeshare names to keep an eye on.

tonight at redfin that internet driven brokerage and real estate and tech first here at the new york stock exhang change in july keep an eye on that plus we do have fed speak this afternoon. carl back to you. >> thanks. talk to you soon let's get to the bond pitts as well rick already brought us jobless claims this morning which suggests an influence out of harvey. >> good morning. yes. harvey continuing claims always weak and will probably show up next week and mario draghi this morning showed up immediately. i picked the two at a here a little more contact. up to what was the middle yesterday but do keep in mind we are really bumping across the low wreeyields not only for 201t

going all the way back to november now the foreign exchange market that's where all the action is at and we're going to have, we're going to have him right around 10:30 eastern ask him specifically about what we're looking at next. the euro versus dollar, it's a dovish statement and how did it look euro versus dollar, euro looked great. open it up to december of 2014, what you find is that these are the highest euro versus dollar levels i only look at a closing basis since the first day of 2015. january 1st, 2015. dollar index three or four days off but same basic history comp but to go back to december of 14, the dollar index was last year right around the 5th on a closeing basis of january 2015 so four day difference why is the euro rallying is the notion of quantitative easing becomes more an more

blurry let's see what he has to say and we'll go from there. arl, back to you. >> all right, rick see you in a little while. coming up this morning the road ahead for tax reform and the trump agenda we'll talk to david mcintosh markets up a touch 'rba i21p wee ckn just a minute.

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president trump striking a deal with democratic leadership on harvey relief and three mores in the debt ceiling breaking away from his own party. >> we had a great meeting with chuck schumer and nancy pelosi and the whole republican leadership group and we walked out of there, mitch and paul and everybody, kevin and we walked out and everybody is happy not too happy because you can

never be too happy but they were happy enough and it was nice to see that happen for a change. >> the deal coming as congress comes back into session after the august recess with a full agenda joining us now president for the club for growth and former congressman, david mcintosh. >> great to be with you. >> so the question we're trying to figure out today is does that deal with the democrats? does that deal spell bad news for those looking for tax reform or the opposite? >> it's good news for tax reform but what it did is cig until that president trump no longer has faith. lead john mccain to the balm care repeal over the summer so he thought they can't possibly get everything done that needs to get done. i need some breathing room this fall for two reasons

one is the tax cut proposal. the president made that his number one domestic priority that's our number one priority at the club for growth and this gives him three or four months to work that out and the second i think was to continue funding so that the military would be funded if he gets into a military confrontation with north korea so these two things i think the president said i don't trust these republican leaders to get the job done and gets everyone to focus on the tax cut bill. >> if you think it's a signal that the president doesn't trust the republican leadership how does that bode well for tax reform which the group of six have to work on this fall. >> he'll never get to 60 votes for a tax cut sboil bill so he s all the republicans and they

need to pass a budget to trigger the 50 vote margin in the senate he is is going to have to go back and work with the republican leaders but he sent them a message ly work with the democrats so let's work together and get the tax cut bill done. >> president trump has his own style. it's not the way i would have done it but it's the way he does it he'll humiliate people in public and then turn around and work with them to get a deal done everyone in washington needs to get used to that. >> i wonder if this three month window bought by the apparent deal right now is really all that helpful when we're dealing

with a math problem. you're still trying to find a way to get corporate rates low enou enough how is that all going to help arrive at something comprehensive in three months. >> the key is for speaker ryan and leader mcconnell to work with conservatives and even more in these bills and conservative factions are willing to work with you to get this tax bill through. on that front they can get the numbers done they're going to have to give up this adherence to revenue neutral. they need to do tax cuts that will spur economic growth and let the growth rate give up to 3% and that will create more jobs and economic prosperity and more revenue for washington.

they'll have to figure out a new way to raise the debt ceiling so we don't have a historic default on our debt and pass this tax reform and you're optimistic all three can happen by the end of the year. >> what we were looking at is all three of those had to happen by the end of the year what they did was the deal took the pressure off getting them done in december and gave them until september to get all three done i think the republican leadership if they work with all the members of their conference conservatives and moderates can get it done. the democrats have too many people like bernie sanders and elizabeth warren that they can't come that far to the president's

position on tax cuts so he'll have to return back the republicans to get the big a tells done in december. >> as we're talking or just prior to it the president writes for all of those daca concerned about your status during the six month period you have nothing to worry about. no action. to what degree does daca complicate what we talked about. >> immigration is not an issue the club ever engages in but you look at that, i think the president is signaling i want congress to fix this program and congress needs to deal with this issue to figure out they came in illegally and contributing to members of our society. and the president said what i want is a strong border and we

don't have future illegal immigration. that will be in the mix. fortunately the six month deadline there means it won't be swept up in these three months for tax reform and the debt ceiling and those other issues. >> well just add it to the list then for congress after that david, thank you for joining us this morning just after that tax reform and all the other things on the legislative agenda. >> less than a week until delivering alpha jp morgan's jamie dimon coming up on tuesday september 12th e to delivering alpha.com thdow is up 19 points. we're back after a break stay with me, mr. parker. when a critical patient is far from the hospital, the hospital must come to the patient. stay with me, mr. parker. the at&t network is helping first responders connect with medical teams in near real time...

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the nfl is the most expensive content on television. spending a combined $7 billion annually on rights and things are look up after last ear's ratings slumped during the regular season mostly blamed on the election now preseason ratings through an average of 15% across 24 games over last year now a correlation between preseason and regular season viewership moffettnathanson predicts a 5% in nbc and 11% in espn and the nfl is rolling out a number of changes to keep fans engaged using split screen ads and limiting halftime is shortening overtime but there's still concerns variety survey of three top

media buying agencies found concerns that fewer people will watch ads this year than last year and told the sports business journal that the new cycle was likely as it did last year and ten thursday night games and how other tech guys see the value of those rights start to expire in 2021 one wrench thrown into the season, hurricane irma causing this sunday's miami and tampa bay game to be postponed. >> unfortunely so. that's still one of the best times of the year is when football returns when we come back former chief white house economic adviser reacts to the deal between the president and democratic leaders. financials having a tough time-out of the gate and the dow

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>> take a look at the markets. we keep our eye on hurricane irma oil not helping either back below 49 >> the most powerful atlantic hurricane on record hammering a string of northeast caribbean islands. we'll take you live to florida where irma is is expected to make land fall this weekend. >> the president surprising his own party striking a deal to raise the debt ceiling and we have all the details. but first to our big story tonight the most powerful atlantic hurricane on record making land fall in puerto rico

killing at least 8 people on the island of st. martin how the state is preparing for the possible impact of the storm. back at headquaters tracking the storm track for us >> this storm is still a category five storm if you look behind me and it's moving to the west northwest it makes it's way to the west northwest as it gets closer and closer so i want to talk about potential impacts as they move forward over the course of the next few days. over here to my left, tonight turks and cacios friday southern bahamas and sunday and monday the potential there for south florida land fall and then monday tuesday north fla flarorida, georgia, a south carolina it still looks to be a category

5 or 4 as it gets closer to south florida. >> thank you now to morgan down in miami for an update. >> hey, sarah. so just take a look behind me. this is star island. multimillion dollar homes owned by billionaires and celebrities on this barrier island if you swing further you can see the port of miami. earlier this morning we counted three cruise ships here and as you can see you have lots of residences, high-rises, also of course hotels. now our mandatory evacuation took effect today. growing gas lines and even last night certain parts of the airport were already yam packed as you can see from the pictures i took myself in the terminal that houses american airlines very very busy even at the karenal desks. an hour wait for an suv and that was only if you had a reservation but while floridians

are reacting to this storm they lived through hurricane andrew that last category 5 hurricane that made land fall here in 2002 so many of those floridians are acting with this we're seeing that particularly play out in the insurance stock. big underwriters here as well. a lot of the smaller more centralized insurers here in florida, names like hci group, universal insurance, holdings, all of them sold off pretty dramatically in recent days but

with the worst case scenario forecast for pie my and many people wondering if could be a repeat of andrew or worse, a lot of analysts expect these insurance stocks could continue to sell off in coming days and coming weeks and you want to focus on the reinsurers because they're going to take on more and more of the financial burden as a number of analysts point out pricing has been very repressed in the insurance market for sometime. back to you. >> thank you as in a florida braces puerto rico, the storm bringing strong winds and flooding overnight nearly 2-thirds of the territory out of pow they are morning and it could stay that way for weeks or months. the former governor of puerto rico thank you for calling in so

please give us an update and damage assessment from what you're seeing. i understand that the brunt of the storm managed to skirt the island but still a lot of damage is left in it's wake. >> i think that people react well for the government goal to save lives there's no causalities related to the storm to this point but we have right now more than 6,000 in shelters and i know that they're now working very hard to renew the power and the service to people felt in the

northeast part of their islands. at the tropical storm and now we are working the assessment fema in puerto rico have been doing as well and it's very well handled. >> lead up to the storm about the vulnerability because of the financials space did that make it worse

they issue that to projects that were wealth manage m and so now the system is vulnerable and it's very weak so at the very beginning yesterday, people began to lose power. >> so president trump did declare a state of emergency in pu puerto rico. will they be able to qualify for federal government money in the cost of the clean up. >> i have no doubt

the governor is working on the assessment of the damages. it's a first step to receive any help from fema or any other agencies >> not to put the cart before the horse but hurricane season is not over by a long shot and we do have is other storms brewing in the atlantic. hope mri they come nowhere near you but is there a discussion or plan about how to prepare for storms that have not yet come to puerto rico? >> yes i think that the reaction of the people this tieme was very good sometimes we are afraid.

and doesn't react in the proper way. they knew it was something serious and now heading northbound that's good and we'll be prepared. >> how much of a hit is it for tourism right now? >> it's always hard. >> you don see it. it's nothing that was qualified

by airlines or municipalities. they may be not used to this type of storm. >> yeah. well we wish you all the best with the efforts to clean up and restore power and of course shelter. thank you for joining us by phone. >> thank you we are working to help people and the best for you guys. >> thank you very much and all the best to you as well. the governor of puerto rico, 2013 to just this year. >> when we come back, the president strikes that deal with democrats shocking his own party as they move forward on a debt and harvey funding deal and the president reportedly no longer considering gary cohn for the

top job at the fed dow is falling further into the red down 30. regional banks hitting a fresh 2017 low and 30 year mortgage a new low for the year as well backn mite ia nu raising your family, not rebalancing your portfolio. pursuing your passion, not reacting to market downturns. focused on what you love, not how your money will last through retirement. let us help you with those decisions, and get on with your life. we make it easier to plan for retirement with day one target date funds from prudential. look forward to your 401k plan. people don't invest in stocks and bonds. they don't invest in alternatives or municipal strategies. what people really invest in is what they hope to get out of life. but helping them get there means you can't approach investing from just one point of view. because it's only when you collaborate and cross-pollinate many points of view

that something wonderful can happen. those people might just get what they want out of life. or they could get even more.

>> after a press conference in which the speaker called the partisan politics behind the they dpoesh ya negotiations ridiculous. >> i hope they don't mean that let's think about this we have all of this devastation in texas we have another hurricane about to hit florida and they want to play politic with the debt ceiling. >> it's good to see you guys again. good morning >> the gop should treat the president like an independent party. the washington post says they want to look at him like a brother-in-law not a brother how does it effect negotiations going forward? >> it's a very challenging dynamic because what you have

now is a situation yesterday where i think a lot of republicans felt ambushed by this they felt like they didn't get anything out of this deal so it's going to be challenging as we go forward. i think that the republican modis operandi on the hill is we will work with the president when we can. and that put that in jeopardy. >> is this about it trying to distance itself before the impression in action with congress >> i don't know that the president knows how to play chess. i think that they got in a room and they had some negotiations but it wasn't really a negotiation. i get the sense that the

president was not on top of the details and just made a deal that doesn't bode well for the president's version of tax reform because the very allies that he would need to get that through he already alienated in round one condemning mcconnell saying he wasn't competent on twitter and now to put this debt ceiling fight again right in the middle of when they would be talking about tax reform i don't understand it. >> our viewers care about tax reform that's how we key into this story. do you agree with austin do you think that this in some way, that there could be any other delays or things that push this back? do you think that deal with the

democrats does that? >> i think the timing is problematic. >> if you have this bomb exploding in late december and mid december you created yet another point in which action on more important or not more important but arguably more long-term policy questions like tax reform has to wait we have to realize there's disagreements on the question about what to do about tax whether it's tax reform and involved rate reductions or it's just tax cuts and i think that particular question still needs to be resolved first before we can even get to the discussion about what the legislative language looks like or the way forward but the timing is not helpful. >> they're not just shaking hands for the first time they have been talking about this language literally for years and that in some way the

ball has been rolling. we just haven't been paying attention. is that not true >> well, the ball has been rolling. lots of folks have been talking about tax reform but the particular alignment of issues and policy points are issues for discussion that's very promising. and we did know how big the disagreements were until we started to talk about the policy >> the thing i would say here is donald trump created a massive contradiction that i don't think he intended but they're going to have to resolve. on one hand he got up and said, keeps repeating that he wants a 15% corporate rate that costs $2.5 trillion

that's only doable if you do this as a tax cut not a tax reform but to put the at the time ceiling in the middle of that you can't do just a tax cut because the democrats will say if the debt ceiling is so important why are you blowing up the deficit. so i think they created a mess right now. >> the wall street journal is reporting that president trump is moving away from him as the pick for the next fed chair and steve bannon is saying cohn breaks from the president he should just re-sign. should he? >> i would have never been there to begin with but i one a fan of candidate trump so i'm not the guy to ask on that

i think my impression of president trump is that he wants somebody that he can call upon and say i want you to do a, b and c and for sure none of the other names on the list are even remotely, would even remotely contemplate that so i would not be surprised if by the time this comes back around they're again talking about gary chon. >> do you have any thoughts on that politics around the fed which is supposed to be a-political. >> it is i think the challenge is that he did run cross wise with the president when he criticized the response to the charlottesville, crisis the issue is that the president wants to be unpredictable. this is part of the image that he's putting out part of this is

the unpredictability that the president tries to continue to project so if people think they know for certain that cohn is going to be the nominee the president doesn't want that. we'll have to see where it goes but it seems like he's not there when it comes to being the nominee to chair the fed >> interesting, politco counted the times the president said we'll see. we're guilty of that here too though. >> more than two weeks. >> thanks guys see you soon. >> when we come back nelson peltz unveils his plan to shake up proctor and fwamable. we'll give you the details uan e street will be right back don't go anywhere. move stuff, what are you working on? let me show you.

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>> the proxy battle heats up where nelson peltz investor that owns a $3.5 billion stake in the

company is trying to get on the board. releasing it's 94 page white paper. so this continues. >> it will for the next month. p&g is presenting today at the barclays. >> yes. >> so we also have a response from them. they seem to be very much tied to proving that the recent track

record of the new management team is different and they contend that this idea of going to three separate units is something they considered in the past and they do not believe would be helpful the numbers themselves given the large percentage 40% of the shares held by retail which do side with them. if they vote at all. when you get it sent to your home we'll see. i would add one thing here we focus so much on p&g there's another activist battle going on involving the largest publicly

traded company in europe it's called nestle and we failed to focus on that perhaps as much as we should and that's been a very interesting one. >> it's food beverage and household product which is is slow growth, they have been dealing with foreign exchange head winds market share has been shrinking and getting stolen by small, mid sized brands with stronger digital footprints and advertising and that's a common thread in the white paper. p&g says it's on top of those

trends and a lot of it with investors this year. >> >> the ten year now below 205. that's a new low for the year. below the moving average when we come back the former president of the european central bank will join rick santelli as we see this rally in treasuries dow dn ia nuisow36n mite ♪ it's not just a car, it's your daily treat. ♪

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anytime we are responding to a structure fire, one of the first calls you make is for pg&e for gas and electric safety. it's my job to make sure that they have the training that they need to make the scene safe for themselves and for the public. it's hands-on training actually turning valves, turning systems off, looking at different wire systems all that training is crucial to keeping our community safe and our firefighters safe. together, we're building a better california. good morning, everyone here's the cnbc news update at this hour. hurricane irma remains on a track that could lead to a catastrophic strike on florida as of now miami is right in the path of irma's destructive eye with less than 60 hours until first impact it's forecast to slowly weaken over the next four days an offshore track is still possible florida's governor rick scott was on the "today" show this morning. >> this storm surge is going to

be significant we can get hurricane winds on both coasts so everybody needs to listen to local officials about evacuation orders. make sure that you have a plan. >> irma left a trail of destruction across the tiny caribbean island of barbuda with 185 miles per hour winds shots show homes destroyed or damaged. vehicled overturned. and extensive flooding one death has been reported. residents in south georgia are preparing for irma there's long lines to fill up the vehicles with gas and some gas station hearsay to close because they ran out of fuel we've been following the storm for you all day here on cnbc send it back downtown to you. >> i'll take it. thank you, sue the eia inventory report is out. let's get to dom with those numbers for us. >> for natural gas we have a build of 65 million cubic feet of natural gas in terms of stock piles. that's the governments official that was versus expectations for

a 63 billion cubic foot build so slightly higher than expected. now prices did edge up slightly on the heels of the report but are still down on the day. as we see that heading toward florida. now we're going to turn our heads toward and eyes toward the 11:00 oil inventory. back to you. >> thank you let's go to the cme group in chicago. rick joins us with a special edition of the santellie change. >> good morning and thank you. yes very special edition we have the man, the pred ses to to mario draghi and of course there's going to be a bit of a delay so we'll do our best

welcome. i didn't see any specifics on when it would end although december is the date it was implemented. boost demand and raise inflation. on the latter it's doing anything but keeps a limit on import prices. what do you think this far in on quantitative easing and what mario draghi said about it or didn't say about it today, sir >> well he said a very important thing. namely that he would much more explicit in the october meeting. which i have to say the observers in the market was also expecting. another element is the fact that gold in europe is surprisingly dynamic. i say surprisingly dynamic in

comparison with previous objections and i was recomputing over the last six months the expectations have been augmented for this year by 4.5%. from 1.7 up to 2.2 or something like that. it's really important and i have to say and it improves as mario draghi said that the monetary policy is operating obviously. still of course inflation is low. it's very low and projections for next year, down as we got inflation which is of course the ecb and it's not the only game in town. you have t i would say

structural reforms that are still overdue in europe and it is clear that normally the market should function and it's really starting to go fast and we should have wages more dynamic. asset class including them and think about that and the notion of scarcity. there's not a whole lot more of the securities sector that can be purchased as a matter of fact i heard that germany, if mario draghi in december lowers purchases from 60 to 40 billion euros a month they're still going to run out of securities to buy in early 2019 we can argue about growth

but what's going to happen when ecb rules start to be run into what will mario draghi do? >> they will continue for a long period of time and net securities it seems to me that the market expect that a lot of prudence the ecb will start guiding the market toward some kind of progressive next year.

that seems to be clear in the language of course he has always the possibility of exception or exceptional cases. >> the euro and mario draghi said i'm going to do whatever it takes. the euro is right where it is against the dollar and it proceeded to go up to 140 and all the way up to 2014 and then quantitative easing started down to 105. my final question to you, would you own euros knowing that quantitative easing and when it ends is a big question mark? final answer

>> i have full confidence in the euro they should not be the only game in town and my understanding is that this is an important part of the message that is sent by the ecb as well as by the other central banker >> excellent it's always a pleasure to show up here to be my guest and discuss these issues my viewers and i appreciate it thank you. carl back to you.

>> great stuff rick. thank you very much. when we come back, amazon searching for a home for a second headquaters got details on that as we go to break. take a look at shares of restoration hardware surging 40% as it beats on top and the bottom line. raises the full year forecast benefits from a shift to a membership model squawk on the street continues in a moment.

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does that give you pause around this market >> well it has been a trade on for the last 6 to 9 months which has been pro europe and against the dollar so what we heard today was discussion about maybe increasing concern about this euro strength, dollar weakness so this trade into the euro out of the dollar may be one that has been put front and center today so if you have been long that trade maybe some of this rhetoric is making you think twice about where we go from here. >> charles, implacatioications

the stock market off of that >> what's driving interest rates is not the fed it's north korea and what's interesting is the stock market has not reacted to the risk of the situation in north korea the way the bond market has. normally we think that the stock market tends to overreact to short-term noise but this is one situation where i think there's a risk that the stock market is underreacting to the potential difficulty. >> why charles the standoffs lasted decades what's different now and where does anyone get any edge on this. >> we have a different man in the white house who is much more unpredictable than the last people in the white house and this man thinks a nuclear north korea is unacceptable in the way past administrations haven't i'm not saying there's a certainty of a war breaking out but i'd put the probability of

military action at 20 or 25% an that would be very bad on the stock market. >> you're making adjustments to your portfolio accordingly what are you doing >> we think he should not ov overreact. if you have cash balances keep them not a great time to be chasing this market. i own names that are a little more defensive so i do think this is one of the rare times in which i think the equity markets are maybe underreacting a little bit. >> do you agree with that? >> what we have done over the last month has been to reduce the equity exposure from overweight to neutral and cut back exposure to corporate cred credit it's not been directly related

to korea although that's put some pressure on markets the real issue for us has been we have enjoyed acceleration through 2016 into 2017 and markets seem to be pricing that in the discussion was one handle. doesn't seem like that big of a call anymore does it >> no it doesn't and that surprised a lot of people including me i have to repeat myself but i do think this is korea. i do think this is people worried about risk people have been focused on fed.

who is trump going to name to replace yellen that kind of thing that's not what is causing this right now. this is a concern about global development. if we get a settlement in korea then i think you'll see the rates move up a lot. >> the korea problem could continue for months if not longer it's moved to a different stage now. you could be saying the same thing a number of months from now isn't it >> yeah but what i'm arguing is this is coming more to a head. you have got for the first time testing the bigger bond and you have them putting in place antimissile defense systems. this is coming to a head and again we have a president now who is going to bring it to a

head >> you get the bond market and stock market reacting differently and that's my argument now i usually don't say this usually i think the stock market overreacts to risk but this is one case where as you all have been saying the equity markets are believing we have gotten through this before. i hate to say this but this time it could be different this is a real escalation of tensions that the stock market is undervalued. >> >> financials getting hurt at the bottom of the pack again in the s&p 500. this was supposed to be the deregulation trade of 2017 what do you do if you own the banks and they're now on the year to date about 2%.

>> i don't think it changed anything as it relates to interest rates ultimately you have to be confident about the growth in the economy and the -- and where rates are headed perspectively the whole discussion aroundkorel forces i've seen it come and go many times in the past where they're very difficult things to trade around so i think it's hard to extrapolate lower korea, lower rates and then you sell the banks. i think the growth in the economy and ultimately where rates end up is more important we're not changing anything as it relateses to financials i think that's a bigger story and something you have to be very careful about >> all right guys, we'll leave it there thank you for sharing you're views and calls. nice to see you. quick programming note

as we go to break, tomorrow right here on "squawk on the street," do not miss steve liesman's interview william dudley oc bt to talk with dudley back stksack in the green slightly

people don't invest in stocks and bonds. they don't invest in alternatives or municipal strategies. what people really invest in is what they hope to get out of life. but helping them get there means you can't approach investing from just one point of view. because it's only when you collaborate and cross-pollinate many points of view that something wonderful can happen. those people might just get what they want out of life. or they could get even more.

got some news from amazon this morning the company says it's searching for a second headquarters in north nesamerica yet to be determined they are going to invest $5 billion in that facility and offer 50,000 high paying jobs. he expects hq 2 to be a full equal to the current headquarters in seattle. we'll talk to a former executive later this week on "squawk alley," the chicago sun times says the mayor had several conversations with bezos about butting that headquarters in chicago. >> they have more than a million people which is one criteria that amazon is looking for look, amazon actually doesn't get a lot of credit for being such a job creator it's in the top ten of the biggest companies that employ the most workers in this country. i think it's around number eight. 300,000. kroger, higher program plays about 100,000 more than that

now. the direct competitor in the grocery store. so while there is a narrative that hit retail and retail jobs which may be true, also employs a lot. >> it z many are them are in warehouses and we're talking about jobs that are about $13, $14 an hour. very important in the communities in which those warehouse jobs are this is more about headquarters which they point out will be higher paying jobs listen, when you look at seattle and what amazon has done and has helped to the growth in that city in particular and it's tax base, you would think that there is plenty of mayors who might want to wake up. i don't know if our mayor woke up yet in new york but say, hey this is a real opportunity. curious to see what they get out of it. $5 billion, by the way, apple's hq, i don't know where that comes in that's an enormous sum >> yes >> i don't know what they're planning on building >> amazing this headquarter inflation, a couple of research notes we mentioned the mkm note from earlier today. aside from the valuation

discussion, they see in seven, eight years amazon overtaking walmart in u.s. retail so everyone is trying to get a handle on whether short term profits matter when your ambitions are so large in scale. >> yeah. you would think you'd want to have what might be the largest company in the world in your city >> but, walmart i will note, still employed more than two million people in this country but amazon says that it's original headquarters in seattle put $38 billion into that economy between 2010 and 2016. so the race is on. when we come back, the nfl season kicking off tonight as the new england patriots face off against kansas city chiefs on nbc we'll talk about the fantasy football

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welcome back to "squawk on the street." the s & p financials underperforming by a wide margin insurers are leading declines as hurricane irma threatens the east coast of florida. check out shares of xl group and

everest. kie down nearly 2% in down 4% so far this week. it's on pace for the worst week of the year going all the way back to january of 2016. these stocks will be ones to watch as irma is expected to make land fall on florida this weekend. that does it for this hour of squawk on street let's send it back downtown for the start of "squawk alley." back to you. >> all right dom, thank you for that. good morning it is 8:00 a.m. at amazon headquarters, the first one in seattle. 11:00 a.m. on wall street. "squawk alley" is live