top ceos in the financial world and the hotel and leisure business on this friday, november 10, 2017. "squawk box" begins right now. ♪ announcer: live from new york where business never sleeps, this is "squawk box. good morning welcome to "squawk box" here on cnbc we are live at the nasdaq. joining us this morning live from the new york metropolitan opera house, the site of the baron conference, becky, what is coming up? >> reporter: hey good morning by the way, fresh out deal book. great to see you, andrew >> we were blocks away from each other yesterday and today. yeah like that. >> we have a lot of stuff. all of the deal book stuff we are talking ant. there was great news out of

that today, we are here with ron baron at the baron onference we have a lot of things coming here the resort ceo will be joining us and hyatt ceo is going to be here these are three invesmentes of baron funds. two of the three, baron already made over $1 billion on. i'm not going to tell you which two. you have to stick around to find out. the other made several hundred million dollars already. we are going to talk about these issues when we sit down with ron, he talks about the broader markets, which he is very positive on them we are going get to that in a moment and we talk story stocks. stories he sees from this bottom up investment that he does where he looks at things very, very closely, he and analysts we are going talk about the bargains they see along the way and the deals that are out there on the horizon he's sitting out there with us we are going get to him in a moment guys, it's coming up in a few

minutes. >> he did not invest 100 billion dlar to make a billion. he is far less than that, right? >> reporter: right exactly. >> he didn't invest 2 billion and now it's worth a billion >> no, no, he made a billion dollars. >> we invested we had $100 million -- >> reporter: don't say which one. >> 190 toet l for the firm we made $23.5 billion. >> the old saying. >> a small fortune you have to invest a large fortune. >> reporter: no, not the case here we are going to dig into the details in a bit >> let's check out markets after all that movement yesterday after the senate introduced a bill that delayed the corporate tax cut. other things in there that maybe

are a little bit better, according to "the wall street journal" and the lead editorial. when you look at it, really not that far apart we'll see. there's equity futures 37 points. market was down 250 at one point yesterday, closed a little over 100. nasdaq down 16 and s&p down six. overnight, in asia, the nikkei, which sort of hit resistance yesterday turns around and some attributed that weakness to the beginning of the sell off that we saw in the markets. then you have the hang seng and shanghai is up hang seng is down. in europe, not a lot to talk about. fractional losses across the board. take a look at crude, which i did see was interesting. almost 60, but not quite, 57 now, wti, a barrel >> president trump talking trade at a meeting of asia pacific

meetings in vietnam saying the united states could no longer tolerate chronic trade abuses and insist on fair trades. make bilateral deals with countries on the basis of mutual respect and mutual benefit the white house said president trump will not meet with his russian counter part, vladimir putin on the sidelines a scheduling conflict ruled out a formal meeting spokesmen said it was possible trump and putin could bump into each other we'll have more on the asian trip in a few minutes. our top story of the morning is there, disney shares on a roller coaster ride after an earnings miss. they dropped, then did an about face as it has conference call got under way. the turn around happened on comments ceo bob iger made about pricing with the new branded app. >> we have given a lot of thought to pricing, both espn

and disney brand of service. i can't get specific with you, yet. we haven't officially determined it we said we will be forthcoming with you on this sometime after the first of the year. i can say that our plan on the disney side is to price this substantially below where netflix is >> iger said disney struck a deal with "the last jedi." there will be a new trilogy and "star wars" for disney's streaming service. the new "star wars" trilogy raises hopes that the company's fortune will get better. joseph >> is this better for you? are you up to speed on this? >> yes, but i don't want to go off track because we are still on disney and i know you have bart and crockette here. >> okay, but as far as the 30%,

is that better for you, on this? >> for me? >> yeah. i mean, that was a problem for you in the past. how about the estate tax >> yeah. all helps. >> you think it matters if we delay it to 2019 or gets done and it's permanent the lower, the top rate doesn't go up. >> there's a lot of elements that i think are better. there's a lot of daylight between all the sides. >> you were busy >> yeah. >> were you able to watch this at all >> i did i was in between things at lunchtime. >> that's distracting. >> you know this gentleman was related to the guy at the alamo, right? isn't that true, bar ton let's bring in barton crockette. weren't you related todavey? >> tied to an uncle of davey

crockette. >> you believe that? one of these days you are going to come on -- don't. in one of those hats disney was down. it came back, but it didn't exactly surge after this i'm not sure based on it is it because some of the content will only be on streaming so that shows they are serious about putting premium content on streaming is that why people said hey, this is interesting and cheaper than netflix >> look, i think nobody really knows. i mean, we are all grasping at straws to figure out what exactly will be the initial investment they make and how to think about the subscriber opportunity. you know, it's certainly encouraging to think about disney leading to something that is going to be priced low, disney branded content i think one of the things that drove the rebound is they called a bunch of one-time items, eps and the miss wasn't nearly as bad. with disney stock, you are stepping into the void of faith

right now. do you believe that these guys can get out of the kind of muted growth secular questions and turn into a story people have more confidence in whether it's more supportive of the multiple? we are not sure we are there yet. we are seeing in this earnings cycle evidence that the secular concerns are easing for the group. the number of subscribers to the paid tv services that declined lessons in disney, they flattened at fox and cbs is showing growth the big impact content network plays are benefiting from the skinny bundles that's a light at the end of the tunnel for the secular concern that is killed the stocks the past couple years. >> disney was the canary for all this if you look at the stock, it started being effective. i guess it was -- did it start with espn and numbers, which it indicated cord cutting that was two years ago when is the last time disney hit

a new high it's been a long, long time. >> it was then it was august, an earnings report where there's a little slippage in espn low single digit slippage but i think some of the peers are showing they can stabilize that and grow it with the platforms the hope with disney is they can get there with skinny bundles and their own over-the-top service if it's priced attractively with arc of the story, maybe it will change in a couple years. >> is there a problem that's specific to espn some of the cutbacks were, i don't know whether it's good or bad for the stock. they were deeper than people thought. is that a cord cutting story or does espn have issues? nfl? people think it's political. for a long time, it was the crown jewel of all cable it's really lost some of that luster >> yeah.

the viewership problem at espn is focused on sports news. how much news are you getting on your local phone and other sources. there's been a plroliferation o games. there's more games on fox, nfl that, i think, is weighed. on top of that, there eels's a o bad press for the nfl. espn has those challenges. disney is cutting back their expenditures on that part of it and leaning into their entertainment, their kids brands with this online subscription push that is, you know wharks they are saying is that's where they want to go as opposed to fighting the battle in sports. >> do you rate stocks as buy, hold or sell do you have price targets? >> of course >> where are you >> neutral on disney i have a $101 price. the secular concerns are not

enough where i want to put my next dollar in disney. i recommend cbs, cheaper equity, better exposed to growth opportunity, i think there's opportunities in the tv station companies trading at four to five times free cash flow, but close to the growth size of broadcasting >> barton, i'm hearing voices in my head. thank you. >> great, thank you. >> okay. that's the capital right now let's get back to becky quick at the baron investment conference. you are back take it away >> reporter: i'm back. we have been here. we have been listening it's been an interesting morning, already thank you, joe our co-host for the next two hours an host of the 26th annual baron conference today at lincoln center is ron baron, the ceo, cio of baron funds. thank you for joining us >> thank you

something went wrong with my ear. >> that's okay you don't need it for the moment this is the 26th annual conference you put a lot of effort into it every year explain to people what it is and why you get folks together >> we are trying to let people understand when they invest with us, they are not investing in us, they are investing in the companies we choose. we keep investing our business, hiring, retaining people so they can identify businesses that are going to grow a lot and there's something about them that is competitively advantaged we can hold them a long time the average holding period for our funds is eight years, maybe. for baron growth fund, the funds i manage, the largest, 14 or 15 years. publicly owned companies what's cool about that is, even better, that fund has outperformed the market by 500 or 600 points a year since the founding >> which mean what is in terms of overall growth? >> compounding is 13 some on

percent and the index competing against is seven it's with 80% volatility what we are trying to do is show people it's not really us, it's these companies we have invested in long term that's what they are invested in we want them to see the executives, look them in the eye, see if they feel like they are smart, honest. there's a lizard-like, gecko gene you have that lets you understand if people are honest, straight or smart. you can figure that out. we want people to see these executives and do that for themselves, and thank them >> the theme for the conference is disruption. how did you come up with that theme? >> by reading the papers and understanding what is going on in the country everything is changing political norms through being disruptive and, you know, there's a lot of parts of foundational elements of our

democracy, which are being attacked whether it's freedom of press or freedom of speech or freedom of religion. a lot of things are under attack that's disruptive. so, that's where the idea comes from when i was thinking about that, i started thinking about, gee, this is like what happened in the 1960s and 1960s, you had vietnam, you had civil rights rk women's rights, marches on washington and you had all these things and this very rough assassinations of president kennedy, his brother, martin luther king, incredibly disruptive period, then a few years later, impeachment of president nixon or he resigned before he was impeached. this length of -- >> were you pinging that to now? i thought it was companies disrupting and as a result, getting ahead of competitors >> the point i make is the positive disruption you are

describing comes from this incredible disruption in society happening all around us. in fact, i looked at this period in 20-2017 it is very, very disruptive period not just for politicians we have now, but if you think about 9/11 and you think about the afghanistan war and iraq, you think about all the things that have happened, financial crisis, almost a depression. think about those things, oh, my god, this must be awful. stocks keep going um that's for 17 years during this period go back to the '60s and see the same thing then go back to the 1930s and '40s and it's the same thing from disruptions, that's what creates opportunity. that creates ability for growth. that's the point i want to talk about today. >> the market has been phenomenal over the last year, since the election or what we have seen taking off you told us in the past, when you look at stocks you see

35,000 to 40,000 for the dow you now think it's a lowball estimate >> it may be low we are talking about it, market is 18,000 or 19,000 and the dow made 23,000. the dow jones, as a shortcut, you compare to the gdp of the country. they were both, you know, economy was $20 trillion and maybe the market was 18 or 19. a little underpriced now the economy is a little over, the market is a little over that. the idea is, the stock market relates to the economy sooner or later, they get to the same plalce, not at the same time, but at the same place whachlt happens is sometimes it gets out of whack and sometimes the economy keeps growing and the market doesn't or sometimes, at the end, it's the same. that's 6% or 7% a year, including inflation. 2% or 3% real, 4% inflation.

people say there's no inflation. that's ridiculous. there is inflation, think of anything you buy and salaries. six or seven is the economy. double 11 or 12 years. the stock market doubles every 11 or 12 years so the stock market will be 30,000 that may be low because interest rates are so low >> why do you think growth is going to be faster >> a couple really important factors, well, three since 1973, that's when opec raised the price of oil from $10 a barrel to $30. that's the oil embargo, people waited in line that messed up our economy then it got to $147 a barrel 10-30 to 147 in 2008 that was a big penalty on our country for growth that was number one.

number two interest rates, when i started in business in 1982, interest rates were 18% now, they are almost nothing now, you have the banks have all been recapitalized, you have lots of capital. capital is not a constraint on the economy. you have businesses because of technology becoming capital light. then you have technology, which is reducing costs for businesses and making a lot of new businesses that didn't exist before and a lot of extra services you didn't have before. essentially, you have low cost energy, low cost money and technology driving everything. that's on the positive side. the other side is the value of your money everything you keep in your pocket and savings account is falling in value every day the only thing you know for sure, you don't know if the market is going up or down the value of your money is going down what we think of that is taking the value of your money, taking money, sitting in the bank, you

know it's falling in value and lose zing. take that money and buy something that is increasing in value. you are protecting yourself. that's the concept >> ron baron is our guest host for the next two hours we are at the annual baron conference in the meantime, when we come back we have a lineup from the baron con frenls later this hour, we have veil resort ceo rob katz. then we are talking with the ceo of charles schwab. walt stay tuned lots to come we'll be right back.

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system there are differences. the senate plan doesn't repeal the estate tax, just doubles the amount that's exempt and leaves the mortgage interest deduction unchanged at $1 million, not $500,000 president trump left china and is in vietnam today. overnight, he sent out a strong message on trade at a meeting of asia pacific countries kayla is here to bring us up to speed on what he said. kayla? >> reporter: joe, president trump was the opening keynote at the apex summit, a gathering of 21 nations that is grappling with his decision to withdrawal from the transpacific partnership early in his presidency a group of countries, led by japan and excludeing the u.s. is set to agree in principle to a deal that represents a third of the gdp of the original deal in his speech, president trump

took the virtue of america first and the bilateral deals. >> what we will no longer do is enter into large agreements that tie our hands, surrender our sovereignty and make meaningful enforcement practically impossible >> reporter: in his comments, he undercut the world trade organization calling it inefficient and called out rule breaking members like vietnam and china and the competition by joint ventures, forced technology transfers, cyber theft and state owned enterprises. that's coming after a relatively friendly summit where president xi and trump got along famously. they said that summit where there were a slew of ceos in attendance broke new ground for

business >> we have 18 facilities here, 5,000 employees, all of them locals what does it mean in terms of growing up for china and can you grow from inside china out most of us are growing from outside china, in. i think that's what we are going have to figure out the next few years. the one thing that is key is turning up that eels why i'm here you have to be part of the shift and understand it from their perspective. >> reporter: if you want to know how that visit is playing in the papers here in china, we poke up this morning in beijing to china daily, sign of u.s. ties at new historic starting point. then the south china morning post has a little more of a couch view red carpet for trump in beijing, but tough tests still to come. there's disagreements on north korea. trade investigations are set to wrap up in a few weeks we'll see how it plays out between the two countries. >> all right, kayla.

thank you from across the world. good to see you every morning. what's coming up, andrew >> from across the world to across the block we'll get back to becky quick at the ron baron con frenls the conference here in new york. first, business leaders make it to a con frenls. we are going to bring highlights from the ceo east of at&t, uber and a lot more as we head to a break. look at yesterday's s&p 500 winners and losers >> it was wonderful. >> bravo >> i love that >> it was great. >> pretty good >> wasn't bad. >> parts weren't good. >> it could have been better it was terrible. >> it was bad. >> awful >> boo ♪

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♪ welcome back you are watching "squawk box," live from the nasdaq market site in times square. futures at this hour are a little lower the dow down 36 points, almost 37 down six and change on the s&p nasdaq down about 16 points. >> news out from "the new york times," a deal book conference i was hosting, has been dal stephenson refuting reports he offered to sell cnn for the merger with time warner. >> one of the key benefits of putting these two companies together is to stand-up a new advertising capability we have built an amazeing distribution platform. 150 million mobile subscribers,

the largest tv base in the united states, a huge broad band base there's a lot of information in data we think can be used to stand-up in advertise zing business pairing that with the turner advertising inventory is a powerful thing, we believe that is what we aspire to do selling cnn makes no sense in that context >> government official told cnbc the d.o.j. presented with several options to settle anti-trust returns, but never demanded a cnn sale. we talked a little bit -- i kept saying, is it possible there's a misunderstanding here? he talked about the idea, there is a bit of asking i think it's hard to try to understand how one side feels one way and one side feels the other. i have to say, randall is a straight shooter we know him very well. we have had him on the program so many years. we was very adamant that what we have heard from these sources is

not right. so -- >> it's possible that the leakers don't know what they are talking about or are low level and that doesn't mean that the people they leak to isn't going to run like it's fact. that's a problem nowadays. take that problem and cube it and it becomes fake news that's where the term comes from >> no one in this is low level >> as far as the justice department or at&t >> let's not say where >> how can they -- someone got something wrong, somewhere or someone is not being totally truthful somewhere >> that's the part we are trying to figure out. >> i don't think it's truthful this is, you start a deal book -- >> this is true. >> they are lucky. they got in early with you i think the negotiations, you should have insisted on being the end. you were young, though

>> i'm happy it's "the new york times. uber's ceo spoke about his turn around plan for the company. he's never spoke publicly before uber's business model is working in certain parts of the world and could be profitable after ease easing back. he addressed their difficulties. >> we have a product and brand that this founding team, travis and the founding team built is extraordinary. the talent of the company is extraordinary. the culture went wrong the governance of the company went wrong and the board went in a very bad direction but, if their product is good, then if you can bring good leadership and ultimately bring it together. i think we are on our way. >> speaking about a soft bank investment, it hasn't happened, yet, but says it will. meantime, we are going to get back to becky over at the baron

investment conference. becky? >> reporter: andrew, thank you very much. talking about interesting companies. we have been listening in on that we are here at the baron investment conference with ron baron, the cio atbaron funds we are here where he is getting ready to take the stage. one of the things we talked about with you is about how you have come up with a winning formula. your fund made how much money over the time of its exist tense? >> funds made $23.5 billion since 1992 >> of that $23.5 billion in profits, $10 billion comes from 15 stocks, correct >> isn't that amazing? being a long-term investor is how we have made the profits we have been investor since 1997 we have been an investor in hyatt since the '70s and since it's been public again, six or seven years.

investor in charles schwab the stocks hit 45 or 44. our cost is 88 cents a share in veil, our cost was 22 or 23, it's now 220 >> those are two stocks you have made a billion dollars in each one. >> hyatt our cost is 25 and it's now 70 >> i want to talk about tesla. this is a stock you have been a long-term investor in and you have high hopes when you look to the future you have made money in tesla about how much money have you made to this point >> about $150 million so far we have been an investor for about three years. it's a $500 million investment, presently. i think we have a chance to make 20 times the money over the next 15 years, 10-15 years. people don't have that much to invest >> we look at tesla and elon

musk who does things people don't think are posz zable he does this by making such huge bets and taking on such huge challenges along the way, it's gotten him into trouble there are questions about the production and whether it will be able to produce as many cars as they need what do you think? >> that's the most insane thing i have ever heard but you are right, that is what people are talking ant, whether he can make cars you know, his history, we invest in people. his history is, he built a business when he was a young man, sold it for $10 million or $15 million, built papal, sold it for $150 million. his share. he could retire. he took everything and put it at risk to develop electric cars. i spoke to him or sent an e-mail to him a weekend ago and we were talking about he was saying how much he appreciated our support

in difficult times when he's gearing up to make the cars. i said i think you are going to be very, very successful whether you are or whether you are not, the whole earth should thank you for moving forward with electric cars, which never would have happened not for him. all the interests are aligned against the automobile companies, the oems, hundreds of billions invested in plants that make engines there aren't going to be engines in ten or 12 years no more. the oil industry doesn't want this to happen the dealers, they make their money on servicing there's not going to be service. unions don't want it to happen because it takes fewer people to make the cars that are electric. what he does, it reminded me of robert kennedy the talk is about disruption in his times and he said that he sees things the way they are and

other people would say why he says he thinks about things that never were and wants to know why not this is a guy who thinks about things, why not. when you think of rocket ships going to space, i'll get to tesla in a second, rocket ships going to space, then see them dropping away. they cost hundreds of millions of dollars every time you do a launch the fuel cost, 250-500,000 dollars. why throw away that investment >> doubters aside, you are a believer >> then we are talking about him, what he's doing to tesla. what's interesting is there's as much value being createed from the making of a car as the car itself the idea is that the cars are historically made with a lot of labor, then went to robots he looks around and says, gee, this is how fast a human walks and how fast the robot walks why can't we have the robot?

we have to have more robots. then says why have the robots go this speed why not have them go five times as fast? we are trying to make it more productive all the other automobile companies have to do this sooner or later, but he's doing it now. they can't catch him >> it may take a while to get to where he wants to be he described himself as being in the circle of hell with the latest production issues he's sleeping in the floor at the plant. >> it's not easy to do what he is doing the "valkyrie"uatvalue he creatu open a restaurant and serve hamburgers, everyone can do that everyone can't do what he is doing. when you stee strobe lights, things move so fast. the strobe lights in some of these things my idea is, when you are out there and doing something that's never been done before, doing robots and a guy is supplies robots to you and they are

supposed to be meeting a deadline this is what you are supposed to be doing this is the software you need and it doesn't work exactly right. okay, it will be a week later, then a month later you have to fire him and do it yourself they do huge amounts of work they have the best engineers >> reminds me of a story we heard with jeff bay bezos. does musk have the same patience from investors >> if you have a $50 million market capitalization, people are being patient with you reminded me of when i came to wall street or began to be interested in stocks in the 1960s, then federal express comes along and people tell you, sell it. how can it have this value we invested with steve, we made

$1 billion with steve wynn with elon, it will be $4 billion or $5 billion. with wynn we tripped in 2007 and we were a founding investor in wynn resorts we made a billion in 2001-2002 he comes, calls me up and says, ron, i just had a meeting with investors. i'm profoundly depressed he says one of your best friends comes to my meeting and says, steve, you have made me so much money, but i can't invest with you until three or four years from now because i haven't, you are not going to have -- i'm going invest when it opens he says mario, i can't invest with you he says there's not going to be five years from now if i don't get the money now. the same thing with elon

people studied his business. people that talk negatively about him, they have never met him or talked to his engineers you have to understand then you make a judgment about what risk you learn to accept. when you think about sending a rocket into space, having orbit and not falling away and coming back to land -- you okay you want to share my water >> i have some right here. >> how can you think this incredible fete, where you come back to earth and land in a spot and you are within ten or 12 feet the next one is going to land right on the spot. he will be upset if it doesn't land on the spot you can't make a car when you can land a rocket from space on a little quadrant? how is that possible >> you have been an incredible judge of character not in picking the winners, but which ones to avoid. later, we'll talk to ron about

an investment he passed on that's investing with harvey weinstein. right now, back to you >> yeah, that is the intersection of everything that's going on and that will be interesting to hear. talking about character issues and the like we look forward to that. coming up, new york mayor, bill deblasio. he will be with us fresh off his re-election win. he wants to weigh in on the gop tax reform plan. he absolutely loves it no probably -- no apparently he does not we'll get his comments on that then we'll get the senate's version with senator pat toomey. then remembering our vets. a former cia director and david petraeus is here and we'll talk to him about containing north korea, the saudi purge and other

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the company's third quarter rurts. hanley topping estimates thanks to surging revenue from the core gaming market. that stock indicated up 4% or so is kramer's dog named in the video? krarm talks about nvidia a lot it's got pictures of his dog i love dogs. who doesn't? you don't because you are allergic, our producer nordstrom lower sales. they say hurricanes hurt traffic in puerto rico, florida and texas. news corp. beating the street on the top and bottom lines the company says results were driven by a tight control on expenses and revenue across all of its businesses. coming up, we are going hit the slopes with the coo, of vail rob katz and ron baron, coming up after the break

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. welcome back, everybody. we are live at the barron investment conference at lincoln center today the country's largest ski resort operator has seen its shares climb 50% over the last year the company has focused on strategic growth opportunities and also integrating technology

into the consumer experience on the slopes joining us right now to talk about all of this is rob cats. the chairman and ceo -- >> you mechaniced earlier you've made a billion dollars in this stock, and this stock was the biggest positive contributor to the fund's performance in the current quarter. why were you first attracted to vail >> we first started investing in vail because of the unique asset that we had -- that vail had when we started to invest, all the things that i thought were a good idea, the executive who was running the business then, didn't agree with, and wasn't doing. i used to say that we invest in people, not just buildings, but in his case we invested in the building just teasing he is a good guy i didn't like how he managed the business

for the first ten years that we invested in it, we had faith that sooner or later they were going to change the management and follow policies that felt more rationale at the time they were charging $44 a day to ski at the mountain we thought if you made the experience better, instead of $44, you could charge $1 00. what happened is that then rob comes along, and he takes over 19 -- in 2006, and at that point for nine years we had made 70% or 80% nothing special. then 1996 when rob came over, they did all the things that we thought were -- should have been done where investing in a mountain, new ski lifts, investing in the town, new restaurants, new facilities. then made ski passes a really huge part of the business, and then built a network of other mountains that enabled him to sell ski passes in other places instead of just where we are right now and that ski pass business represents a very large percentage of the company's cash

flow >> right >> and so it's been brilliant. this is the network effect, and then we keep buying these other mountains at attractive prices that are fitting for us to own, and he has built it. >> hey, rob. >> he made it. >> part of what you have done with building this network, though -- >> oh, and, by the way, the stock -- since we started until now, the stock was 25, and now it's 225, and that's because of him. >> rob, kudos. watching what's played out this way. we now have some competitors who are trying to copy what you have done ksl and aspen are some of the resort competitors they've seen what you have done with this pass going across. they're trying to do the same thick. what does that mean for you? >> i think it's good i think, first of all, new competition is i think a positive for any industry. new ideas. i think my hope for them is that they really put together a pass that's compelling for skiers and riders you know, something where you really get unrestricted, unlimited skiing like we've had at all of our resorts at this incredibly low price the benefit of this pass is that

our guests see it as this incredible value a steal almost our company sees it as an incredible value because we're selling all these passes before the season begins. we take all the risk of weather, of economic fluctuations right out of our season before we even start. to the extent you have the company and your consumer loving the product, it's amazing. i think with these competitors, if they offer something that's truly innovative, truly compelling, that will be a positive for the overall industry because it will remind people that they have to buy their season pass before the season begins. our data marketing and everything that we've put together, we know we'll be able to compete just fine >> very quickly, when you look at your next opportunities, are you going to continue expanding internationally, or do you see areas here in north america? >> i think there are daeshl areas in north america we see japan as a terrific opportunity and europe, which is the largest ski market in the world. five times bigger than the u.s

>> want to thank you for your time today we really appreciate you joining us >> thank you great to be here great to be here with ron. >> you thought you were going to get away with this ron looks at people so closely and judges his manager so closely that he notices that rob had an earring hole. rob said nobody has ever noticed that before. noticed that >> i appreciate that, and i appreciate you mentioning that on air >> you thought you were going to get away >> thanks, rob we appreciate it >> we do have much more from rob bar ron, and he will talk about why he passed on investing in the weinstein company eight ar nine years ago very interesting story we'll talk to the ceo of charles schwab about investment trends and market strategy. also, the ceo of hyatt hotels nfen joan us here at the barron coerce stick around "squawk box" will be right back.

what's critical thinking like? a basketball costs $14. what's team spirit worth? (cheers) what's it worth to talk to your mom? what's the value of a walk in the woods? the value of capital is to create, not just wealth, but things that matter. morgan stanley

and in this swe see.veryday act, when we give, we receive. ♪

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>> "squawk box" special event. we're special e spending the morning with investor ron bar ron. his best ideas straight ahead. and bill de blasio will join us in studio find out why he is worried about the plan coming out of washington plus, checking in to hotel squawk the ceo of hyatt joins us with a unique take on the global economy as the second hour of "squawk box" begins right now. >> live from the beating heart of business, new york city this is "squawk box." >> good morning. welcome back to "squawk box" here on cnbc we're live at the nasdaq market site in times square i'm andrew ross sorkin along with joe kernan.

becky is at the barron investment conference taking place just a couple of blocks from here at the metropolitan opera house. she's joined by ron barron we're going to hear from them in just a moment. hi, becky. it's nice to see you >> hi, andrew. >> we're going to check on the markets and come back to you show you what's going on right now we are in the red. it looks like the dow would open off 40 points. nasdaq off about 16 points s&p 500 off about seven points here's what's making headlines at this hour we have this run of retail reports. it continues this morning. we're expecting the latest numbers from jc penney that's at the bottom of the hour company expects to post a quarterly loss of 43 cents a share with a third quarter on revenue of almost $2.8 billion comparable store sales expected to increase by half a percent. also, automaker joseph -- we always go back and forth about this automaker >> i think that -- i think the public -- >> there's confusion in the public >> i just want to make it clear. >> hyundai

>> may be shifting more. >> you usually put about six sill bells in there. >> hyundai >> they say the company considering moving production of its tucson and kona suvs to its alabama plant. it could be moving it to tucson. just slielgs lower than the october reading and still near the highest in a decade. >> wildly it swung after the bell yesterday julia borstein joins us now with the reason julia. >> well, joe, disney shares dipped after missing expectations on both the top and bottom line. largely thanks to lower than expected results at the median networks division which includes

espn the stocks didn't turn positive during disney's -- announcing of the disney app launching in 2019 will be priced "substantially below netflix" as disney looks for a broad subscriber base. >> our goal here is to be viable in the direct to consumer space. we also believe that our brands and our franchises really matter, as we've seen through netflix and all other platforms.

>>. >> our strategic acquisitions have been a key driver of historic performance we've achieved over the last decade. we believe it's another game-changing acquisition, and we're confident in our ability to generate maximum value from it iger deflected various questions about whether disney needs more scale he says the company is strong as-is. also, he said you could never have too many valuable movie franchises back to you. >> thank you, julia. now we want to get back to becky, who is at the barron investment conference at the metropolitan opera house becky. >> andrew, thank you very much as you mentioned, we're here at the annual conference for barron funds shareholder, with ron barron, the ceo, the cio, and the portfolio manager for barron funds. one of the things we talked about at the top of the show, for people that may be joining us, about an hour ago we were talking about where do you see stock prices headed. you've thoed told us in the past we could see dow 35,000 or 40,000 by 2030 you are say that could be a low

ball target. >> we were thinking the economy growth is going to accelerate, and that means the stock market growth accelerates, and that means interest rates and other valuations should be higher. i think the most important thing for most people to think about is about being an investor for the long-term. you don't have a lot of money to become wealthy

>> it's worth $890,000 $5,000 a year. basically people don't, you know -- they get worried about what the president is going to do or what's going to happen with the price of oil or what's going to happen with interest rates or what's going to happen with taxes, so it's always about the short-term thing, and everyone -- what makes you know more than anyone else and the answer is maybe you do, but even if you did, you wouldn't know whether the stock market already reflected that or whether it didn't the key is to just not think about that thing, not be deterred by what you see happening in the world in your opinion of what that means for investing, and just know that the value of your money is going to fall in half every 17 years, and the stock market could double every 10, 11, or 12 years, and keep investing straight ahead the reason you do better in the

margaret, of course, is that if the market is based on companies drawing 6% or 7% all we do is run 15 a year basically that's the reason you've done better >> you make it sound very easy the idea of just finding companies that are going to grow 15% a year, and we talked this morning about how a lot of it for you is investing in people finding people that you think are going to be these fantastic managers i would argue that the other side of that is really knowing who not to invest with you need to be able to be a judge of character and know more importantly than ever when you should not be putting your money down you have a great story that you mentioned in your letter that you just recently wrote about how you were given an opportunity to invest in harvey weinstein eight or nine years ago. what happened? >> an investment banker brought them to visit us harvey and his brother, robert, bob. we spent a day and a half speaking with them

there were some issues were top of mind when they came originally talking about accounting and expenses and allocation of personal expenses, business expenses. >> they were -- harvey was this fantastic producer and it would make great movies and great television shows we were interested in invest not guilty a small amount even though it was a smaller company because we thought they would become successful. then i said, well, i have to do some work and then we'll get back to you. in the next couple of days we talked to people we knew in the entertainment industry eight or nine years ago eight or nine years ago. we talked to, i don't know, ten people, five people, 15 people uniformly we had the same story of the events that are being written about today. we knew that eight or nine years ago, and all the people we spoke to knew that as well it's amazing to me that this is

eight or nine years later and you are seeing it for the first time in the papers how did this happen? how was this allowed to happen incredible >> you just develop it further, and you happen -- you happen -- you just think about people, and you think about who is smart,

who is nice, who is kind, who you think works hard, who you trust, be and you develop patterns you know, it's like playing poker. with other people how they bet you know behavior. behavior is evident in who you are talking to people and it becomes, you know, visible, and then when people confirm or, you know, make you think that you're wrong, you did not know it was right, but you are right most of the time >> you mentioned that you have been doing this for a very long time, making judgments on people, going all the way back to when somebody stole your cartoon -- your comic book collection >> when i went to college. when i went to cleanly, when i was a kid, i managed my comic book collection, and then i had this comic up in my attic, and i

go to college, and i come home, and they're gone i say what happened? any mother said, oh, well, i gave them to alan next door. i said you gave away my comics and my baseball cards? you're kidding then this person became a very successful writer for a television show. a very well known -- >> you're not going to mention names? >> no. very popular television show i was trying to think about how i could -- >> can i give a hint without saying the actual -- like shlameezel shlamazel >> that's the guy. he calls me up five, six, seven years ago and he says i has become successful and he read a lot about me and he wanted to know if i could help him out i said, alan, in 1961 you stole my comic books when you give them back, you can call me again. i don't want to talk to you now. >> hung up the phone

>> you wasted my time. how could you do that? i can't remember who hung up on who, but we were not -- it wasn't a pleasant conversation >> we have much more that we're going to continue to talk with ron about. including how he judges people and some of those managers that he thinks have been worth investing in, once he gets that feeling that judge of character issue coming up. andrew, right now i'll send it back to you. >> thank you that's a great conversation that you are having, and the ceo of charles schwab, we should tell you, is coming up. first take on the state of the individual investor. 7:30 eastern time new york mayor bill de blasio will join us on set. he is worried about the impact of the gop's tax plan on the big apple. plus, later hotel squawk going to check in with the ceo of hyatt 7:40. stayun ted you're watching "squawk box" here on cnbc ♪

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this is one area that you know all too well where do you think things stand right now just in terms of trying to bring technology into trading and getting people to think that your platform is the way to do it >> sure. i think in our industry what's occurring is very consistent with what's happening in the economy overall, and that is a breakdown of long-term traditional views of trade-offs that you can have world beating price, world class service, and high quality advice all in one that's not something that in the investment world people have traditionally believed is possible that's what's happening today. of course, we're riding that wave >> what's different? how are you ableto do that people have always thought, okay, the way to get the stock trading prices how much it cost me for every trade way down is to stream lien it.

no people involved make this a simple transaction >> scale is playing an enormous role today at schwab we have our clients that have entrusted us with over $3 trillion. when you combine great scale, technology, and people, that's where you can get to that no trade-offs world >> when we started to invest in schwab in 1992, it's $60 billion of assets at schwab. it's now $3.2 trillion 60 billion >> 60 billion to a good month or two now. >> now we're getting $200 billion a year i think a big deal is when you have this $200 billion of close a year, why? >> well, i think there's several things >> you have ferocious competitors. >> we do we have wonderful competitors, and we're happy we have wonderful competitors because what competitors do is they not only serve investors well, but they motivate us they drive us forward. i think in terms of our growth, chuck was on to something 40 odd years ago, and that is transparency and using the knowledge that you have in your

industry to do the right thing for clients. i know that sounds trite and maybe overly simple listic >> through clients' eyes where. >> that's been our strategy for four decades, and i expect it will be for four more. >> one of the things that we've been watching very closely is the tax bill has made its wau out of the house weighs and means committee. the senate has its own version of the bill. >> what you do i think of him being in there we're not done with this tax bill yet we don't know what the final versions will look like. >> you have to look at the fact that the roth-ification isn't the end of the world if we were to get a reduction in the $18,000 limit, there are still benefits to save you can say that the vast majority with of 401k

participants aren't in a position to put away $18,000 as long as they figure out some level that takes into consideration that the average citizen, the average investor should be able to maximize in a contribution whenever they can, i think it's possible to lower the 18,000 limit without creating a major problem in retirement savings in our country. >> can we go back for a second to back in 1992? at that time -- the reason we have a business it's because of charles schwab, and we had a business at that time in 1992. we had $100 million under management $5 million was in mutual funds we could not make our business grow charles schwab revolutionized the way mutual funds were sold in the marketplace you could buy our mutual fund through charles schwab, and you pay charles schwab for the privilege of being on their platform >> did you do that before you were an investor >> yes >> in fact, the reason i became an investor is that people auto would have to send money down to north carolina, they would have

have to open up the envelope, have to cash the check in order to get your money back, you would have to call them back and get a signature guarantee. $50 million fund it was impossible. we get into the marketplace, and all of a sudden we get $5,000 a day, $10,000, $50,000, $100,000. oh, my gosh, we better look at this company that's the reason we invested. we started working on the compan company. >> you have been an investor since 18992. it's 25 years.

your average holding time is usually 14 to 15 years why such a long investment here? >> because the opportunity is still tremendous there's $200 billion a year of new money into this firm, and they're unique i think in this instance we're going to double our money again in the next five or six or seven years after we've held it for all these years. i don't see anyone that's a threatening competitor despite the fact that the people against whom they're competing are these really tough, rough fidelities of the world and ubs's and merrill lynch's. somehow the offering that they have is this compelling offer where they're showing people you can trust us it's a rep taegs it's just not, okay, come bring here with this platform. everything they do is from the client's eyes about the people with whom they're dealing. that's what charles schwab is. >> i want to thank you for joining us today we really appreciate your time >> thanks much appreciate the invitation. >> joe, we'll send it back to you.

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>> apple just released this. a patch to fix the auto correct bug that popped up in its ios 11 the glitch changed the letter i to an a and a question mark in some user's texts. this was happening, by the way, to my wife we were trying to figure out how to fix it. the new update fixes an issue why siri stopped working >> that's crazy self-correct loildelao in the big apple za we will talk taxes when ek

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welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square. among the stories front and center, u.s. stock funds that are centered on technology saw a record clars is.3 billion of in flows in the week ending this past wednesday that's according to new figures from bank of america, merrill lynch. investors all soured on junk bonds withdrawing about $600 million from high yield bond funds. meanwhile, shares of cable operator altice are higher in chief market trading the chief executive dexter goya has been given the additional title of ceo of altice's french based parent meanwhile, former ceo michael kohn resigned after disappointing earnings resulted in a sharp drop in the parent's -- or, yeah, stock prices you can see there wow. all the way down to ten. he had been in the ceo job for only a little over a year. the national federation of independent businesses issued a statement of support for the

senate version of the tax reform bill it follows a similar statement about the latest version of the house bill it's a turn-around on the original house bill, which the small business group said it could not support in its then current form >> okay. as that tax reform battle continues on capitol hill, new york city's mayor calling the republican's plan the biggest current threat to new york city. joining us right now is new york city mayor bill de blasio right here on set. we're thrilled to have you where, you wrote an op ed where you said that you might as well ask new yorkers to take $1 ,000 out of an atm and give it to a hedge fund manager if that's what this tax plan entails >> look, it's going to transfer a tremendous amount of wealth to folks who are doing very well and to corporations when, in fact, what we need is a government that's investing in this country, investing in our cities, investing in our economy. when you look at this, it's almost as if the plan was created to take away the potential to fix a lot of the challenges we have how are you going to see an

infrastructure plan, for example, after this? if you balloon the federal deficit, you're never going to see a real infrastructure plan if you take away a $1.5 trillion in federal revenue, long-term, how are you going to see an infrastructure plan? how are you going to see investments in affordable housing, for example, which is needed in this city and cities all over the country i don't go et it i think in the end the notion that there's any semblance of a positive impact here for the places where where the economy is actually growing like new york city where are the jobs are being created, where the revenue for the federal government is being created, it's actually going to set us back >> let me ask you this, though do you believe ultimately that we need higher growth rates in this country and that could come from tax cuts. >> no. >> we had the highest number of jobs we've had in our history, but our infrastructure is falling apart, and a lot of

cities across the country you can say the same on. we cannot possibly fix that on our own. we need a strong federal government wrshs. >> how about if we use the repatriated stuff? >> that's a real possibility what i'm troubled by is if you approximate do a massive transfer of wealth to rich folks and to corporations and you balloon the deficit and then there's no potential for the federal government to be an active partner in infrastructure, where is it coming from? i just don't buy trickle down economics. i would like to see a structural focused federal role this takes that off the table long-term. that's part of what's not being talked about enough here >> let's just say, just for argument's sake, that if corporations somehow became more competitive globally from a lower tax rate rrks therefore, you know, maybe they start doing more business here let's say they start expanding more, they're able to invest more capital, they're able to hire more people and eventually you see some wage gains come from that. isn't there any way that you can connect the dots to where that could grow the pie and then -- i

mean, once you have growth, all of this stuff you want to do becomes much easier. all the education or infrastructure, you get 3% or 4%, and suddenly you're able to do some of these things. there's no way that happens. you think all these guys are either misguided or just trying to help their friends? >> i think they're trying to help their friends i think, two, some have an ideology that's rigid, and that is a supply side ideology. of course, i want growth democrats, republicans, we should all want growth here's the challenge the thing that's not being fixed. we're not fixing our infrastructure we're not fixing our educational system in a coherent manner. we're not making it easier for kids to go to college. i mean, the problem here is this is the table setter for everything that happens after. >> speak to this we've been having a big debate on this set about state and local deductions and what should happen obviously, i'm a new yorker. he lives in new jersey we pay a lot >> sure.

>> we will lose that deduction >> right >> but there is an argument to be said that you want to level the playing field among all states that is the argument that you hear from the gop. what does the mayor say about that >> listen to the trap here state and local deductibility has been in place since 1913 it is something agreed upon by democrats and republicans without. once it is gone, you will never see it again you start with double taxation for a lot of people not just new york, new jersey, but it's 100 million americans that will be subject to double taxation immediately. that puts downward pressure on state and local revenue of where we're going to be having people saying you have to lower taxes therefore, we can't provide much police, fire, schools, et cetera the seconds problem is the federal government then at any point can start raising the federal tax rate again there's no prohibition you lose the protection for homeowners for everyday people, for middle class people this is why in the end a lot of middle class people will see a tax increase practically speaking from this plan.

>> i love. you are on the record now you don't like double taxation >> news flash. >> we have to get rid of the estate tax >> look, again, let me talk about dwight eisenhower. the golden age >> it's your -- now when you die, you get taxed again that's not fair. that's like -- >> listen, what will be good for the country. the golden able of this country, one could argue. >> now you do like double taxation >> when republican divide eisenhower is president, we had a strong federal government helping to spark the economy, investing in education, research it worked. we saw it with our own eyes. this makes it impossible to regain that ground i bet half the middle class pays a tax increase here. >> what would we do with education, though? i want -- we want to fix it. we want to fix it. >> right >> got to invest >> what about choice what about the relationship between unions and really not

being able to -- spending -- throwing so much money at it more than any other country. we don't get what we pay for >> let's recognize we're not investing at the level we should in education and, again, let's -- >> you see any problem with teachers unions? >> i have a lot of respect for the union movement, but i also want to see the best efforts for our kids i think the city is a good example. we push back and forth with the union to get to the right outcomes we've had graduation rates go up steadily we're at the highest graduation rate ever. by the way, mike bloomberg and i didn't agree on a lot of things, but he got mayoral control of education in our schools it was a great move on his part. since he got that, 13 years, our graduation rate has gone up 50%. 5-0. with education unions that i think are willing to work with us, but because we've also heavily ininvested i created pre-k for every child in new york city you don't get that for free. of course, it's constantly

improve the educational practice train our teachers better. push them to do the best they can do look, if you are not investing in early childhood education, if you're not -- we're doing a.p. classes, advanced placement classes in every high school in new york city, that's telling kids they're college-bound that takes money, but it's money well spent >> i have a totally separate question >> yeah. >> now that you have won a second term, does it change the dynamic for you? >> look, when you have that second mandate, it allows you to get a lot more done. i just mentioned that we have pre-k for every child in new york city. that's something we created in my first term. i want to do the same thing for 3-year-olds now. i think it will revolutionize our approach and it will take a financial burden off working parents too, and i think this is the kind of thing the country needs to look at how do we give our kids a strong start and lighten the burden on parents, middle class parents, working class parents who are struggling to make ends meet it's wonderful to be able to do these things big scale, fast in a place like this, and the mandate allows that to happen.

>> and given that mayor bloomberg set the pace, you want to go for a third term >> oh, no. >> no? >> oh, no. again, i had differences with michael bloomberg, and things i really appreciated, and i think it was a mistake to go for the third term two term limit the people chose it, and the people are right go out and give it eight years leave it all on the playing field. that's the way i look at it. >> being the mayor of new york, obviously, it helps if we have a vibrant wall street, a vibrant financial sector i'm just back to wondering whether there's any way that we can get corporations not to want to open offices abroad or move headquarters over there or move operations over there and leave the money over there because it's taxable is there anything you would do for corporations to level the playing field that you wouldn't just call or just hoping big corporations where you could see that helping the private sector would end up helping the people that you want to help and narrowing incomes? >> sure. >> what should we do then. >> i don't pretend to have i amagic formula it's not my area of expertise.

do i think there's a version of figuring out -- >> corporate tax reform. >> is there a way to get the money back that would be fair and keep it here -- >> i do think you see this across the spectrum. people think there are pathways that could be fair i think that's a different discussion than the one before us how on earth are we going back to supply side after it has been proven wrong that's -- >> then i would say that what we try for the past eight years and that is trying through maybe redistribution or trying to make -- looking at your notes, you said i like the tax reform to include helping the income inequality, and i assume you mean by that giving tax breaks to people in the lower -- how do you do that when they don't pay tacks? it's hard to do it >> let's talk -- >> entitlements, isn't it? >> middle class and working class people

backbone of the country. middle class and working class people if this tax plan were about them, it would look entirely different. if we said let's just focus on the vast majority of people -- and they're struggling right now. we know that >> what would you do for them? >> if you want to give them a tax break without -- >> what if the lower 47% don't pay taxes -- federal income tax in the first place wouldn't they rather have a job and then pay some taxes? >> everyone wants a job. the question is what spurs a healthy economy, right let's go right back. i'm arguing we have not invested in it this country you could say the last eight years, though -- >> you're infrastructure $3 trillion over there $3 trillion. think what you could do. >> if you do not have a public sector run -- when i mean run, meaning public sector funded infrastructure plan, it won't get done >> it won't get done >> and history suggests when that has happened, it has spurred the entire economy i'm not talking about the stimulus under obama, which i

think was only a glimmer of what it could have been and should have been. we have real live examples in peace time and in war time of what a proper stimulus does. look at our competitor nations what is china, germany, everyone they're investing in infrastructure, education, research, and what are we not doing? >> there's somewhere we could agree on this in talking about it >> great minds think alike >> mr. mayor, thank you for coming in. >> thank you >> congratulation on your re-election. >> people said you wouldn't show, but here you are >> right on time >> right on time >> i think it's the "squawk box" effect >> it's the new term, i think. >> feeling good. >> you don't want to be here every day at 6:00. >> i was thinking it could be a side gig >> like his. >> oh. we're coming back. >> coming up, ceo of hyatt hotels it's a global company with more than 600 properties. a unique take on the world economy. first, as we head to break, check out the shares of jc penney the retailer posting better than expected results, including a

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joipgs live right now is mark, the ceo of hyatt hotels. barron funds, by the way, has been invested in hyatt since 2009, and, mark, thanks for being here today >> thanks for having me. >> you know, i want to talk to you about what's happening with the stock and what your plans are for the company. earlier this month the stock hit a new all-time high after you announced that you would be divesting $1 .5 million in real estate why that move? what's going on? >> well, back drop is that our core business is actually doing very well, so our results are quite strong in particular, our fee-based business, management fee-based business has been growing at a significant pace it gives us a lot of flexibility to be able to manage our capital base differently, and we've been actively recycling our assets, but we rlsz that we can actually sell some of our hotels, it realize great value for our shareholders, and also accelerate the move towards higher portion of our earnings coming from our fee-based business >> what do you do with the $1.5

billion that you raise where does that money go >> we're looking at new investments, of course we're always looking to reinvest in the business. we've made a lot of investments. in hotel businesses, management companies, but also with the advent of real focus on experiences for consumers, we've been extending our grand beyond the traditional hotel business we entered the wellness space this year, which means we bought a high-end destination resort company and another brand called exhale, which is a fitness and spa business as an alternative adjacent platform to really enhance the offerings we got for the high-end travellers with th serve. >> ron and i were talking about that earlier when you look at the other hotel companies, some of your biggest competitors, marriott that is 1.1 million rooms, hilton has 800,000. you have 180,000 how do you compete against some of the bigger companies? what do you do >> that relative scale is not new. we've been at this for a long time in that same position what is new is a real focus on

thinking about what we can do to deepen our relationships with high-end customers wellness is the first really significant area that we are getting into it is in high dough manned wellness travel is growing at double digit rates, and it is the number one thing that our customer base is looking for really differentiating the experience on property is our strategy >> one of the themes for the barron conference is disruption. that's the overall theme that ron is going to be talking about today. when you look at the hotel business, there is certainly disruptions coming in from places like abnb you have a new investment that you have made in oasis how does that compete? >> well, air bnb has done great things for the industry, which is opening up and expanding travel initially their focus was really very much focused on the human experience at the touch point of staying somewhere, and we've actually piggybacked on that in some ways and gone back and disrupted our own company, if you will, by looking at ways in which we can bring humanity back

into hospitality, try to get rid of some of the standard operating procedures and things we've operated with in the past and really encouraged our colleagues to really bring their who wholese wholeselves to what they do. we can also look at alternative combinations, and we've made an investment in a small company in london a few years ago to sort of wade into it and understand the business, and most recently in oasis it is definitely an area that we're going to continue to focus on >> you give so much authority to people who run authorities that's out of the norm how do you control services like that to make sure that it's operating properly >> the answer to that is we a decentralized operating mandate, which is we really push a lot of responsibility and accountability down to the hotel. every one of our general managers is really running their own business and really focused on what they need to do to

deliver a great service to our customers, and also care, which is really beyond service >> these people are all in some way networked with each other and sharing best practices and showing what works and what doesn't work >> exactly we do have -- i would describe it as a framework, but lots of flexibility within the framework. yes, there's also friendly competition internally if someone is doing something that is really working well, others will pay attention to it and study it and adapt >> they're aware of it through these supports >> exactly >> international opportunity >> yeah, growth is significant we have a very large pipeline of hotels, and about over two-thirds of it is outside the u.s. in china by far it's the single biggest market about one-third of our total pipeline is in china >> what are the reasons they like to do business so much is because of -- and the opportunity we have here is that

we have this brilliant architecture >> it's true we have quite a few hotels that were designed by architecture award winners, including the park hyatt here in new york. in china we have a bunch of iconic hotels that really have garner aid lot of cache. >> i want to thank you for joining us today we appreciate your time. >> appreciate it >> we'll send it back to you in the studio >> thank you for that. so terrific. >> still to come, we have much more from ron barron, including his best investment ideas. then at the top of the next hour senator pat toomey will join us in studio to talk taxes. then at 8:30 eastern time david p petraeus will join us to mark the nation's veterans day.

welcome back to "squawk box", everybody. we are reporting live from the 26th annual barron investment conference in new york this morning. our special guest for the morning has been ron barron. he is the ceo, the cio, and the portfolio manager for barron funds. ron, i know you have to leave us in just a moment because your guests are here. you're about to go up and take the stage and kick things off. before you go, what message would you like to leave for people who are watching from home >> so when i was walking in, there's monitors downstairs a level below, and they were playing a lot of montage of president kennedy. this happens to be the 100th

year that he was born. 100th anniversary of his birth may 29th i was thinking about that, and it's very touching just watching this and thinking about all that he was trying to accomplish and what he did accomplish and what his brother accomplished and i'm thinking about how much better our lives, you know, were and have been because of those people as i think about the health care that he started, you know, that his program was in the peace corps and civil rights and all of what -- this base we have comes from that was the disruption, and we're having disruption now. the same positive feelings i have now or what's going to happen i think that the key message i would like to leave people with is that they should remain optimistic and not be upset even though things don't go exactly the way they want. ultimately, it will.

it goes one way and goes the other like a gyroscope you shouldn't be upset everything will work out well. >> stock market is essential an examp -- certainly an example of that over the last year thank you for your time. appreciate it. joe and andrew, back to you. >> okay. thank you so much for that coming up, we're going to talk taxes with senator pat toomey. he will join us on set straight ahead. you're watching "squawk box" here on cnbc "volatile markets." something we all think about as we head into retirement. it's why brighthouse financial is committed to help protect what you've earned

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. >> we'll talk to a key player senator pat toomey former cia director general david petraeus joins us on set final hour of "squawk box" starts right now ♪ take me to new york i would love to see l.a. ♪ >> live from the most powerful city in the world, new york. this is "squawk box." >> good morning. welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square. becky quick is at the ron barron

conference, which is now actually just the conference itself is just getting underway. let's get a check on the markets this morning and check out the futures. >> down five on the s&p 500. nasdaq down eight. yet was a volatile session, which we haven't seen much of lately at one point it looked like things were going to get substantially worse. down over 250. >> the pullback -- maybe it was something to do with the tax plan >> jc penney out with results in the last hour. what do you say about those? our friendly friends at jc penney >> i said they were better >> they were better. >> it's up 15% >> i called it a $3 stock.

>> i did i don't think you're allowed to -- there are certain things that happen. it's like a penny stock almost you know, if you are a new company and you are a penny stock, it's one thing, but if you are an iconic, you know, u.s. company and you are a penny stock, it's probably says things haven't been going so well but better better >> the retailer lost and adjusted 33 cents per share. that's smaller than the expected 43 cent loss revenue also topping expectations same-store sales rose by -- that was higher than some estimates, and as joe mentioned, trading at $3.18 right now. also, take a look at shares of disney this morning. they are rebounding after initially dropping on an earnings and revenue miss subscriber ad revenue. also, poeed a decline. here's what happened bob iger says disney has struck a deal with ryan johnson, director of the upcoming star wars film "the last jedi" to create a new trilogy set "the star wars universe" and an

action tv series also being developed for disney's streaming service. his comments about the streaming service and the plan to price it competitively with netflix that has seemed to give the stock a little bit of a boost back president trump is overseas, and talking trade at a meeting of asia pacific countries in vietnam overnight. he said the united states could no longer tolerate chronic trade abuses and would insist on fair and equal trade policies >> what we will no longer do is enter into large agreements that tie our hands, surrender our sovereignty, and make meaningful enforcement practically impossible >> all right separately, the white house said president trump will not meet with his russian counterpart vladimir putin on the sidelines of the meeting a scheduling conflict ruled out a formal meeting, although a spokeswoman said it's possible that trump and putin could bump

into each other at the summit. we'll talk more about trump's asia trip with general david petraeus that's coming up at 8:30 a.m. eastern time now to tax reform. senate republicans unveiling their plan with few key differences from the house bill. we are joined from cnbc's headquarters good morning >> good morning, andrew. there is still a lot for these two chambers to iron out the big difference on the business side is that the senate delays the reduction in the corporate rate until 2019. in the house the rate goes down immediately. we also have completely different approaches to pass-throughs. the senate gives them a 17.4% deduction against they are income the house cuts their tax rate to 25% and sets up new guardrails to keep this from becoming a loophole for the wealthy now, for individuals the senate does keep seven tax brackets, but lowers the top rate to 38.5%. the house has just four brackets with the top rate at 39.6. the house and the senate will still need to pass their own

versions of a tax bill before lawmakers can worry about working out their differences between the two plans, and there is a grumbling, of course, coming from both ends of capitol hill in the house, representative leonard lance says he is mad about the cap on the deduction for property taxes and over in the senate jeff flake of arizona says that he is concerned about the plan's $1.5 trillion price tag. new projections show that the senate plan does comply with the rules that they're using to fast track this bill, but, joe, there is another rule that requires it to be deficit neutral in the long run, and the bill might have to change to hit that target back to you. >> under 1.5 is what they needed to do, and there was concern thank you, though. there was concern. we have senator corker here a while back maybe there's -- it's justified because there are still some sacred cows and there's going to be some lobbying joining us now is a key player in the senate's tax bill, finance committee member senator pat toomey

we should also have the camera running maybe, senator i said when you sat down, i don't think these plans are that different, and it looks like they could be reconciled pretty easily i think i also said to you that initially the markets looked at that delay of 2019, but once they looked at the business expensing, if you can get it, you got to get it under 1 .5, and it's hard to get it anywhere else ask if you can do it that way and get business expensing, it's not that bad because it's permanent too to 20. >> that's right. business gets to deduct the expenses against a 35% rate. >> right >> that's a big deduction. >> that's almost as good as having it happen now maybe even better. >> it really is. i'm very open to the discussion about moving that date forward that would not be a terrible thing. there are trade-offs, as you point out. there's a limit to how much revenue we can forego. i have to tell you -- >> not that different. >> it's not that different the fundamental principles are the same tax savings for middle income families a dramatic reduction in the business rates so that we can compete. moving to a territorial system

so we don't double tax business overseas the architecture is the same i think we'll be able to iron out the differences. >> what about the delay on the corporate rate that's the big issue >> you get business expensing. it's even better than the delay. then you get it under 1.5 trillion you have to get it somewhere >> look, we're on our side i think we're going to be open to have this conversation i mean, we think about it, and we're not that far apart we've got -- the goal is 20% permanent. one starts on january 1, 2018. the other starts january 1, 2019 i think we can find a way to bridge that difference >> it's harder to make it permanent if you start it immediately. you are over $1.7 trillion, which won't pass muster. you already have flake already talking about not wanting $1.5 >> the journal says that the senate plan improves on the house plan in several important ways, but it ends by saying the details matter, but the larger story is that the senate, which

was the cemetery for the health care bill, is -- has joined with the house. it could be -- i can see how there seems to be people said virginia could go either way with whether it helped or hurt this effort. i think it lit a fire under some of these guys. >> we've been working all year long on this, working closely with the white house, with our colleagues in the house, and yesterday we unveiled the details to the entire republican conference in the senate now, we've been discussing the major elements for a long time, but it was really well received across the conference. now, we've got a hold on almost everybody, and we understand that there's a lot of enthusiasm because it's going to encourage economic growth and investment in the united states >> the journal says the wealthy will still duck the tax by moving their assets into truster foundations or sell businesses

prematurely. it diverts resources from the economy. there is a growth reason to get rid -- >> of the death tax? absolutely again, it's a matter of what pieces we can fit into this box. we lift the exemption to $11 million for an individual and $22 million for a couple that really covers a vast overwhelming majority. >> if you add -- that won't work for him if you add -- if you are still going to be -- >> sorry we left you behind. >> i'm left behind by that plan. >> is the pass-through -- this seems -- >> the pass-through is better. 100% 100% >> it's much simpler it captures a lot of -- >> you know, we've talked about reagan would never raise the high -- would never have add an additional bracket for wealthy individuals, which the house does i mean, that's like philosophically not where a normal -- >> it's not where we were in the senate finance committee >> how do you think that gets

reconciled between you do you guys win? >> there's going to be a long list of things that we have relatively modest -- here, again, it's one point. >> what do you think trump does? he always talks about bob kraft says -- he would probably preefr the house bill >> we're arguing about this t y tiny, tiny difference, and i think president trump would be okay with either outcome it's a tax savings for the middle class, and it makes business competitive it's going to encourage tremendous investment. it's going to be very pro-growth >> were you surprised at how quickly it got out of the committee in the house it's actually moving >> it is moving. it's very good news. i think they held every republican on that vote. they're making good progress where. >> in terms of how this moves forward to the extent that you think it is close, just to help us understand where the fault lines are within the house relative to when this comes back >> you mean in the policy or where the challenges are i think it's the things we've been talking about we're going to have to reconcile

slight difference on the top individual rate. we're going to have to reconcile the timing by -- >> who do you think will go with you and who is not >> will you lose some of the red statehouse guys with -- >> you mean blue statehouse guys >> blue state house guys >> one guy already said -- look, i think we'll figure out what it takes to keep everybody on board in that respect. i think it's good policy to disallow that deduction. why should my constituents in erie, pennsylvania, be subsidyizing the cost of high taxes in new york city and san francisco? >> i think if you were in the senate and let's call you an independent because you're right in the middle. >> thank you >> i think with this pass-through change and with being able to bring the money back and the territorials, all the things that are in there, i think -- >> i need a full score >> i think you are almost there. under $1.5 trillion can you make up for a loss in the republican side of things? >> i always thought --

>> would you get him to 51 >> if it's scored closer to 500. >> we're not getting another -- >> 800 maybe you take a chance. >> you spent $10 trillion. you spent $10 trillion in the last eight years >> here's a number to think about. .4% of extra gdp growth completely fills in the hole .4% on average for the full budget window. don't you think you are going to get that come on, andrew. >> come on, andrew come on. >> i hear you. no, no, i hear -- >> you're not ready to make a decision you got to talk to your wife that's what my clients always used to say. >> got to talk to my wife. that's my answer i'm using that can i call you tomorrow? i need a lifeline. i need a lifeline right now. >> senator, thank you. >> thanks for having me. it's a big step forward. >> not usually that exciting to tax about tax reform, but it's kind of interesting. >> it's interesting -- >> hopefully not just to us. >> it's also interesting that the market is at least initially took it one way -- >> 90 points >> we'll see

thank you for this thanks still a lot to come on the show when we return, at&t's bid for time warner, uber's ipo timeline, and the reason why twitter ceo jack dorsey did not attend those congressional hearings on behalf of his company. the headlines from the "new york times" dealbook conference i hosted yesterday u'ed tun yore watching "squawk box" here on cnbc i think it's terrific.

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>> there still seems to be clear difference on both sides literally about just what even happened at that meeting >> i mean, clearly, welcome to the media business, right? that's what i think randall is facing at this point

by the way, really great job on that interview yeah, there was a big gulf between what was reported in terms of, hey, we need some structural remedies here we probably need to sell something off, and him basically saying, you know, well, i wasnwasn' wasn't -- i think they have a long road to go to figure this out. >> you may not have been watching yesterday, but -- because you were doing this. we had a media reporter on for one of the big newspapers. he told us that he knew for a fact that trump was still mad at zucker because he gave zucker the apprentice ratings when zucker was in charge of nbc. zucker still -- trump still is mad. told the justice department to enforce a sale of cnn. he said he absolutely knew all these things you know, that's a really sexy story. just like randall just said. number one, would he know those things, and can you just say

that off the top of your head and pretend that it's true i mean, it's a sexy story. is there any veracity there? >> we really don't know. the one thing that's so fascinating about this is the new head of anti-trust enforcement was interviewed when he was still a professor, before he even got this job, and he was asked on television what he thought of this transaction, and he said on the merits of anti-trust law this should pass. not a problem. >> so there is no -- >> hold on then he goes from being a professor. >> suddenly. >> into the administration if you will, or into the department of justice, depending whether you think it's a political job, but it is a politically appointed job, and has a potential change of tune my question for ed is, clearly, the message that i heard from randall stevenson yesterday was that he is prepared to go to court. we are now in a grand game of chicken. if you are the government, how do you think about that? >> well, i think if you are the government, if you are the

anti-trust guy at the doj who is now questioning this deal, you don't want to go to court because i think at&t has the case, as he has pointed out, to vertical merger, which means ur auto not taking competition out of the business. if you are a consumer, you still have the same choice out of this they have -- i think they've got a slam dunk court case for this. i'm really curious to know what made him think needs to be done here he is a conservative the way they tend to approach these types of deals is what we call a structural remedy as opposed to a behavioral one. when comcast bought nbc, that's the closest example here there are a lot of behavioral remedies that was born out of that one this time around if he is holding true to his -- >> it feels like at this point, though, that it may be hard for the doj just to say, okay, we're passing it as-is, given the commotion that's being created is there anything you think they could ask at&t to do that would be acceptable from either a dive divestature or behavioral standpoint >> from a behavioral standpoint,

there's a lot they could ask for that would be fair, right, in terms of, you know, if you are a showtime or a stars, you might have an argument that, hey, i don't like the hbo is now part of at&t. i'm worried that at&t won't properly market my channels now because now that they own hbo. there are things like thatting that i think would be a legitimate concern >> that's all they got we kept asking -- >> it's small things like that >> what is the rationale for saying this is anti-competitive or you can't do it all they can really say is that -- >> there is none >> what they kind of make this leap to, well, they could control some content and it would only be on there -- and they would charge more >> that's the thing. i think a lot of people don't understand the mechanics of the media business they're worried about things like, well, you're only going to keep hbo within at&t they don't want to do that it doesn't make any sense. if you own hbo or cnn, you want it to be as widely distributed as possible. that's how tv works. >> you have really come a long way since you're -- >> i have always felt this way, joe.

>> since your neutrality rants you are very free market about this we all evolve. we all evolve. >> hey, ed, we want to pivot right now to the other big interview with uber's new ceo. he was speaking out for the first time since taking the helm here's what he had to say about the ride sharing start-up going public >> we have all of the disadvantages of being a public company as far as the spotlight on us without any of the advantages of being a public company. travis and the whole board now agree that we should just go public the numbers support it the systems support it, et cetera >> speaking about a soft bank investment, he said it hasn't happened yet, but it will. talking about whether it will, ed, we still gather that there is some commotion on the board about how this deal will go down and, therefore, whether it will.

>> well, so there are all these questions about, you know, sort of rights in terms of what kind of voting rights would come out of it after the soft bank investment wants that's the money they're going to get it's also about what travis will get out of it. he is no longer part of the executive team he is still, of course, on the board and a founder and significant shareholder. basically the other shareholder, the other benchmark, in particular, which is the vc that backed this company in the early days, they don't want travis to have as much of a say as he has had before that seems to be the big sort of hold-up. in addition to price, of course. everyone wants as much as they can get out of it. >> real quick, in one of the other interviews i did with jack dorsey, we had a fascinating conversation about square, but then we got into twitter i had said to him, you know, have you ever thought about going to congress the last week, you know, all of the big tech giants ended up sending their lawyers. he said i absolutely would go if invited to represent the

company. you have a story this morning on that issue >> yes well, we checked with our sources, and, you know, we asked our congressional sources, and they said,a you, he was invited. we would have loved to have him come in. >> you think they all were invited? you think all -- >> they're all invited of course. if congress invites your company to testify, the ceo should show up or at least the presumption should be that, hey, the guy in charge, the person in charge, should be there. yes? you know -- >> they were invited by name or the companies were invited >> the companies were invited. i don't think he was singled out by name. i think you kind of split hairs at that point, though. >> ed lee, thank you, sir. good to see you. >> all right we're going to talk about siemur fi with david petraeus former cia director general david petraeus will join us, and we will ask about putting vets

to work. tomorrow is veterans day the north korea threat and trump's asia tour. we're right back you know what, i'm not buying this. you gotta come a little harder dawg. you gotta figure it out. eh, i don't know. shaky on the walk, carriage was off. randy jackson judging a dog show. i don't know dawg. surprising. what's not surprising? how much money lisa saved by switching to geico. wow! performance of the night. fifteen minutes could save you fifteen percent or more.

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okay, great. welcome back to "squawk box"

here on cnbc live from the nasdaq market site times square stocks on the move this morning. nvidia is rallying it earned $1.33. that was well above estimates. in fact, it beat it by 39 cents. stocks up 4.5% there was strong demand for gaming news corp. shares are higher this morning the "wall street journal" publisher earned 7 cents a share for its first quarter compared to the consensus estimates for a penny. nordstrom shares are lower in premarket stragd trading the company did beat estimates, but comp store sales fell more than expected. andrew, i have -- 242 years for the marine corps, which is before 1776, which is what we think of as the founding of the -- but it was in a tavern down in philadelphia and a brewery where they were recruiting for the revolutionary war. that's -- happy birthday to the marine corps

we have general petraeus you rememb you were he remember a, but we love all of our -- >> >> going to get a quick market update from dom chu dom. >> you can see we have paired some of the losses in the premarket trade in the future side of things if you take a look at the price action yesterday, there's a reason why some folk out there don't believe that yesterday's move was the precursor to anything deeper. at least not right now the reason why we did see some pretty big moves in the s&p and nasdaq yesterday we finished well off of those lows for the s&p 500 we actually closed right about where we open all of those exacerbated losses intraday evaporated by the time the closing billion came around, and you have reeled off a number of positive stocks today two sectors to keep an eye on with regard to the sentiment out there. there are two of the more momentum centric sectors cyclical sectors that's technology and financials take a look at technology, first of all the spider etf that tracks that ticker, xlk, actually took a

pretty decent dive yesterday, but finished right where it opened up, like the rest of the market did financials as well we watch interest rates here as part of this story the xlf, this is the spider financial etf, actually finished higher than where it opened yesterday as well. it was still down marginally on the day, but, still, a lot of people rushed in to buy technology and financial stocks. those are two of the more momentum centric parts of the market i would also point out, joe, andrew, and general, the idea that the markets right now could be poised for a fall is something a lot of people are watching one thing that they are keeping pretty close eye on is what's happening with the high yield or junk debt market a couple of the etf's that track these over the course of the past couple of weeks have actually taken some pretty decent dives versus the overall stock market if you are looking for that cautionary sign out there, maybe high yield debt is one of them, although i would point out the same thing happened earlier this year as well, and it bounced back to hold pretty stable in terms of year-to-date gains. something to keep an eye on. if you want more in the story an

interesting note out from bank of america, merrill lynch on our website, cnbc.com right now saying this latest pullback may be just the dress rehearsal for the other big ones to come, guys >> it's interesting to watch, though we hear it's not a barometer it is a barometer. we're right in the middle every day. we're seeing the tax bill move out of committee, and then we're seeing a senate version. the market kind of does this and that it's going to be interesting to watch as this plays out. it's near term, dom, and we're at all-time highs. it's going to be interesting >> absolutely. i would point out this has been a staggering run for stocks, right? we're still trading well above our average price over the last 200 days >> okay. thanks, dom. tomorrow is veterans day joining us now david petraeus, retired four star army general, who is currently chairman of the kkr global institute he heads their vets at work program, which has hired over 50,000 veterans since its launch in 2011. general, it's great to have you.

thanks for being here. >> good to be with you >> we have, unfortunately, been hearing some anecdotal things about what happens to our vets that isn't always great, and we wish they could be perfect all the time for these guys. obviously. you have some positive news, which we don't always hear >> i think the big news this veterans day is that the unemployment rate for veterans is now considerably lower, according to the bureau of labor statistics, than is the national employment rate. that's a very big deal >> and it hasn't -- >> that's quite different from what it was a number of years ago. i think it's a result of a number of factors. it's the smart thing to do, and that has been the case at kkr and in companies in which we're invested, which, as you mentioned, are kkr vets at work program has broken through 50,000 just in the last six years since that initiative was

launched and we're not only trying to provide veterans jobs, but we also realize we need to provide them careers we want to help them by investing in them, indicatieduc them, training them, mentoring them, having focus groups. all of the elements that help someone who brings extraordinary skills many cases off the battlefield knows how to lead, how to follow, how to adapt in the face of a resilient enemy and very tough weather and terrain conditions all of these experiences and attributes and so forth are being brought to the civil work force. they just need for firms to invest in them and give them more than just a job, a job opportunity, but an dunt at a career they're making the most have that >> a lot of the other issues that have been highlighted this week, this overarching theme would help that. we heard about vets that are hungry and don't have access to food >> sure. >> we hear about the v.a. get

private health insurance or do they still use the v.a. when they're employed >> they have access to the v.a again, i think the v.a. system is gradually improving i think that bob mcdonald started that by the way, we honored him last night. >> really? >> at the iraq and afghanistan veterans of america annual gala. i think the -- who, of course, moved up in the organization is very much continuing that. the initiative congress and the white house to give additional authorities to the v.a. secretary i think are very positive as well we can then speed the delivery of services and the bureaucracy that, you know, used to take a year or more you just get a bill paid all the challenges a veteran has, at least we can get their bills paid for v.a. care and so forth on time. >> i just wanted you to reflect on your own career in the military just given this day and sort of how you feel about beyond the

sort of bigger issue >> well, look, i think serving one's country in uniform is the greatest of privileges, and beyond that it's an even greater privilege to serve with others who all feel the same way. regardless of how americans have felt about the policies that we've been implementing, they have generally been supportive of our men and women in uniform. unlike the vietnam era, we've gotten it right this time. >> you feel the support? >> very much so. this goes way beyond thank you for your service as important as that is, this is into a whole bunch of tangible >> if you're not politically divided the country feels right now, do you think that that may have any bearing on the -- not the support from the military, but for the men and women that are in service >> i think across the board by and large americans support their men and women in uniform, and their veterans and, by the way, their families as well.

i think there's a very, very considerable level of support, and it stems to our universities i am a chair at the university of -- taught here at the university of new york they're all trying to provide better for our veterans. the private universities are making up the difference between the gi bill and the cost of tuition with something called the yellow ribbon program. usc does that for all undergraduate majors now and just about for graduate school as well. the v.a., getting better, absolutely always need for more improvement. yes, we still have to cut down the suicide rate of veterans and also deal with veteran homelessness and a variety of other issues i think a lot of positive developments there and, again, the most significant this substantial reduction in the rate of unemployment for our veterans it's a complete -- >> the suicide rate, we had the secretary on the other day, and we asked the question, and i thought we misspoke about it then i have been thinking about

it yesterday is it really 20 per day? >> certainly in that realm the rlast time i saw it >> do people know this >> yes oh, very much so i think everybody. certainly in the veteran community -- >> if you lose a helicopter and, you know, for days it kind of hangs over the consciousness when we lose guys. when you are talking about 20 -- >> this has a face on it all of us know veterans who have committed suicide, and it's tragic again, something else that we've got to continue to attack, without question >> as far as readiness currently five, ten, 15 years ago, where are we in terms of military readiness? do we have the funds and the suppo support? >> tnumbers that i have seen thi year are hardening because there are areas of readiness challenge without question a lot of those caused by sequestration a few years ago.

when you allot $50 billion or more out of the budget in midyear and then you fence certain areas that you can affect, what you end up doing is basically grounding the aircraft, tying up the ships and parking the tanks that are not actually in war or preparing to go to war. that still exists. then there's marine aviation, airline pilot shortages and a variety of others, and as we saw with these naval accidents, we've been using the fleet very, very hard and clearly that has resulted that's certainly a very significant factor in these accidents. >> i wanted to ask just one news item curious what your take is on what's happening in saudi arabia right now. >> well, this is very, very interesting. you know, someone the other day said, you know, saudi arabia is in transition. i think this is a revolution

>> moderate form of islam he has called for women can drive. entertainment available for saudi citizens and so forth. then, of course, you see a very significant change in how the country has been run, basically, to where it used to be sort of a consensual different family members and now he is very much consolidating power, i think, because he feels that he has got to drive this forward and the anti-corruption campaign that's now ongoing. i know you were just saw principal alwalid, and, of course, he is now caught up in this >> internally it feels like there's a lot of support for an anti-corruption effort >> a huge amount of support by the youth of saudi arabia for virtually everything that he is doing. the question is, you know, how will this play out >> how are international investors thinking about whether you want to put money in that country given the cross-currents

of what's happening? >> well, just in recent days, if continued, again, we have to wait and see this is going -- you have to assess the environment certainly. again, the aggressive revolutionary move in the economic realm, the soernl realm and so forth should give us hope, but then we also have to see what is done with the anti-corruption campaign >> thank you >> thank you >> pleasure. thank you. >> thank you >> happy birthday, marine corps. you just had a birthday. 39 again tuesday? >> yeah, 39. that's right >> happy birthday. >> coming up when we return, a stock that seems unstoppable nvidia shares up 100% so far this year. you would have liked toown thi for the past couple of years we're going to dig through the timap kers with an analyst right after the break.

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welcome back to "squawk box. computer chip maker nvidia posting a third quarter result above analyst expectations that's beating on the top and bottom lines with strong chip bemanned boy, would you have wanted to own this stock show a chart it's really quite something. anyway, joining us right now for more on what's going on with nvidia and also the chip sector, which seems to be in the news like crazy between broadcom and qualcomm and amd, and intel. chris, the semiconductor analyst and manager at raymond james good morning >> good morning. thank you. >> first of all, can this run

continue >> well, you know, if you go back a year ago, you know, a lot of nvidia was based on the promise and kind of hope for artificial intelligence and data center now you're actually starting to see it kind of really happen and really putting up the numbers. you know, compared to where we were last year, the stock has doubled about over the last year, but estimates are up quite considerably as well >> okay. that's the question. given the estimates, they're still beating, but where do you see this 12 months from now? >> we just put a $250 price target on the stock this morning. you know, really the key here is we think you're in their early days of the artificial intelligence rant. they're very well positioned in that they have a new product that came out in the last few months addressing that market with higher price i think the momentum is still there. it's still awe large market. it's frank ly difficult to quantify that market given the early days, but it certainly seems that it's going to get larger than it is now. >> what is your take on the whole broadcom-qualcomm deal

if you were a shareholder of qualcomm, what price would you need to actually fall into their hands? >> right well, we did upgrade qualcomm earlier this week too. it's been, as we said, a busy week and the thought process there was that not necessarily that the deal goes through with br d broadcom it's a $70 offer price, but there's a couple of things happening. they are trying to acquire nxp, which is quite a thing for them, and it would get the stock up if that were to be completed and they drive it. the other is they're in this dispute with apple, and, you know, our view is those are the two things that they need to focus on in order to, you know, get the stock up if both of them happen, well then probably you make a case to investors that as an independent company, you could see better than $70 -- $70. you know, i think the likelihood of none of that happening at this point given the fact that the offer is out there is pretty

low. >> pretty low. what would be your take-out price? >> i mean, the offer from broadcom is $70. we have a $75 price on qualcomm right now. from an investor standpoint, you have to say management has to convince me that there's more than $75 worth of value. pick a number ahead of it. >> how do you like intel, and that made its own joint partnership amd. they've been butting heads for years. now they're going after nvidia >> we have been more cautious on intel, and relative to the rest of the group, and i think people know the story there hatch of their business is pc. pc is declining in market. what intel is trying to do to manage its credit is they realize that they're trying to make bets elsewhere. our issue with intel is more about the return on investment of some of these other investments. graphics, they partnered with amd for this one product, but at the same time they've redoubled their efforts to do their own internal graphics, which is something that they've tried

over the years now, you know, for intel to be successful and to screen graphics, they would have to take on nvidia they're doing very well right now, and my feeling is the r & d efforts that you spend on that i just don't think the roi is going to be very high. certainly not as high as the pc market where you have a monopoly and that comes down over time. hard to replace monopoly type revenue. >> check out the shares of hertz, despite canceled reservations in the hurricane impacted parts of the united states hertz warns it will have to list spending as it enters a period of weaker demand. disney's roller coaster ride in the past 24 hours the highlights from the house of mouse's latest quarter that's next. up 2.45% here are futures, weak most of the early morning session but now those are the best levels i've sn,ee down nine points on

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shares of disney are rebounding after an earnings miss we want to catch up with julia borseten joining us right now. >> good morning, andrew, disney shares dipped after missing expectations on the top and bottom line, mostly on weakness at the media networks division the stock turned positive during the earnings call as the ceo detailed his direct to consumer apps in the potential and potential for disney announcing the disney app in 2019 will be priced substantially below netflix as disney looks for a broad direct subscriber base >> we believe creating a direct to consumer relationship is vital to the future of our media businesses and it's our highest priority this year our decision to acquire control enables to launch robust offers and immediately provide us the tools we need to stream video in scale to acquire and retain customers and greatly enhance our advertising opportunities on digital platforms, and to use

consumer data to provide a better user experience >> iger said they are benefitting from new subscribers to offer top bundles and optimistic about the future of espn because it's included in the skinny bundle. he did talk about the transformative power in general, marvel and lucas film and bam tech, disney didn't need greater scale but you can never have too many movie franchises, iger announced new trilology around the last star wars films which got fans pretty exciting. >> julia, thanks, nice move today. that should help the dow a little up next, don't look down at least at your phone. chicago considering a surprising punishment if you text while crossing the street. details next

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two chicago lawmakers are proposing a city ordinance that would fine people for texting or talking on the phone while crossing the street.

fines would range from 90 o to $500, 70 pedestrians have been killed so far this year. the bill has been sent to committee for review a similar bill went into effect in honolulu hawaihawaii >> when you're walking along and see someone almost run into you -- doesn't that irritate, you look up. don't you get mad when they are doing that >> but i'm -- the person i'm the one doing it so -- >> we have not talked about shawn parker saying what are we doing to our children? have i not been telling you that social media a cesspool, go millennials, meet someone in person and talk to them. >> i want to see you get off of twitter. >> i don't tweet, i just look, i like to watch. if you love mcdonald's ice cream -- is it ice cream >> not you're saying it real ice

cream? >> i don't even know if it's dairy. it probably is, i'm kidding. there's an app to tell if you the machine is working before you get there. ice check. it let's users find their closest mcdonald's and whether or not the mcflurry is up and running and anything derifd from dairy products in it it also let's users view the status of the machine. >> make sure you join us on monday have a spectacular weekend. >> happy veteran's day "squawk on the street" begins right now. ♪ >> good friday morning, welcome to "squawk on the street." i'm carl kiquintanilla. cramer is off today. a lot to pay attention to including disney and nvidia earnings and president in vietna