the street," i'm dominic chu stocks trading slightly higher to start this holiday shortened trading week, one of the laggards as oil prices take a hit today. perhaps traders reluctant before the opec meeting next week meanwhile, check out exxonmobil and chevron trying to hold on to gains right now. that does it for "squawk on the street," back downtown to "squawk alley," guys, back over to you >> thank you very much good morning, it's 8:00 # a.m. at teslahe headquarters in palo alto, california, 11:00 a.m. on wall street, and "squawk alley" is live. ♪ ♪

good monday morning, welcome to "squawk alley" joining us this morning, roger mcnamee, elevations partner cofounder. a lot to get to with roger today. speaking of which, the dow kicks off the week in the green, but while we're in the midst of this record run, some are questioning if a top is near we want to pose that question to you, roger, because you've been kind of skeptical about this run-up for a while now i wonder if you think you're hypersensitive to signs of a top. >> well, you know, it's funny, carl my sensitivity is based on just looking at the situation, you know, politically and how all of that relates to markets. to my mind what's going on right now is very simple, you know, we have a massive tax cut that's running its way through congress, and i think the market is making a really good judgment that in all probability some portion of that tax cut is going to go through and that's going

to reward investors in a big way. now, does that make the top? it could easily do so. this could be a classic case of buy the rumor, sell the news from my perspective, again, i'm more defensively postured than some, simply because i find the whole geopolitical situation relative to trade, relative to employment, relative to just general geopolitics could be troubling, and, you know, in my mind that says i want to be more protected against a downside but fortunately, you know, i'm a tech investor, so the things that i'm along have been things that have performed well, so i haven't missed the market. that said, i do think people need to be smart, but in all probability, there is going to be a big, big tax cut, and, you know, i wouldn't call it 100%, but i think it's the most likely outcome. >> roger, what do you make of this wave of at least potential consolidation we see sweeping particularly chips right now

you know, you've got broadcom trying to take on qualcomm you've got marvel now, what's driving that do perhaps some of these companies sense they need to use their currency now or that growth is going to be hard to come by? >> well, john, i think one of the core elements going on here is that there has not been any kind of pushback against tech mergers, and so as a result i think they realize that they have a level of freedom that is unusual in a historical context, and so many of the big companies are seizing that history suggests that big chip mergers, in fact, don't add a huge amount of value, so i'm not sure what the investment case for a lot of these things is, but i can see easily why the bankers like them, because the fees are huge. from the perspective of the selling companies, you know, it's an opportunity to take your money and go to the beach. >> roger, so gaming, graphics, self driving cars, internet of things, you don't buy those

things what >> no, no, i look at this and i go, you know, i think there's a bright future for the chip companies in the sense that there are a lot of new things to sell products into, but i also think we look around at what's going on in global trade and say there are levels of uncertainty in global trade today that we haven't seen for 20 years, and i think there is justifiable concern about, you know, what the relationship between the united states and china will be, and if you're a large chip company, the opportunity to get a lot larger provides some level of protection against that, both in the form of diversification and, frankly, your ability to have the kind of meetings with the chinese government and u.s. government that you would want to have if things are strained in my mind, these are all understandable i'm not sure the economic case is going to be that big of deal, but i think the political case for consolidation is very strong >> just to bring in another big picture theme here when it comes to how this market performed,

goldman sachs put out a note saying expect four interest rates next year. 2018 is going to be another solid year for the u.s. and the global economy, and i just wonder how much that factors into this discussion about the top. technology has been one of the key beneficiaries, whether it's chips, fang stocks, or other companies like a paypal that's up 100% and how much of a risk that is. roger? >> it's a great question, sara, because if you look at the tech sector, most of the big companies have huge cash reserves they borrow money when they buy stock back, but for the most part they have huge cash reserves, so they are relatively speaking not going to be harmed by rising rates, but obviously, the stock market is going to take a hit if we have four rate increases next year, andso again that's just one more thing going on that i think investors need to be smart about i'm not going to pretend to have a crystal ball i got conservative earlier than

i needed to be and so i'm not going to pretend to have perfect vision today either. >> well, viewers already pointing it out for better or worse, roger, because they do pay attention to what you say. >> by the way, they are right to one of the points, carl, that i always make, i make my own choices, they need to make their own choices. i'm not going to be right any more than they are that's why it's a market and that's the beauty of it. >> speaking of trade, roger, the trump white house, there's a story in the journal they are making it harder for businesses to hire certain foreign workers. applications for the high skilled visa program, h-1b have been scrutinized, one in four have been sent back from july and august h-1bs, of course, heavily used by tech firms. when you think about trade, you say the level of uncertainty is at a 20-year high, but are the fears some had around the time of the election actually come to pass >> well, i think relative to

things like immigration, yes and i think this is a really -- in my mind this is one of those things that leaves me scratching my head, because the problem we have is a mismatch of skills you know, in the economy we have a shortage of nurses, we have a shortage of ph.d-level technical people, and those are things we can help to solve using immigration. and the argument against bringing in critical skills, in my mind, is purely political there's no economic justification for it and if i were the trump administration, this is one of those places where i would ignore whatever the campaign promise was and just do the right thing for the economy. >> i think they might argue that they are focused on the lower paying high skilled visas that come in through h-1b and there is a displacement of american workers and they don't want to prioritize foreign workers for jobs that americans can do that would be the argument and the pushback >> i understand the argument i think, though, that's not actually what's going on

and, you know, i think if you look around many of these companies, you'll see that their job boards have lots and lots of openings, many of which go unfilled for long periods of time, so i don't think for the most part that what we're dealing with in at least the medium and high skilled portions of the market, which is, frankly, where most of the tech stuff is, these are people who are skilled programmers, people who do have talent you're right they are not being that well paid, but they certainly have some training >> there's a lot of it in the emphasis -- >> outsourcing, right? >> outsourcing firms, too. >> amen. >> i want to ask about the start-up visa program that looks like the trump administration is rolling back what kind of sense does that make to you? because this is supposedly folks who have gotten a quarter million dollars worth of funding, it kind of extends their ability to stay for 30 months what is the rationale for

pulling back on that people who are at least arguably innovating >> so, john, i don't see it. again, i think your point about the outsourcing firms is certainly one that deserves real scrutiny, but when i look at start-ups, graduate students, when i look at people with ph ph.ds, when i look at people with nursing degrees, those are all things where we have shortages. right now start-up activity in the united states is the lowest it's been at since 1978, and we should be encouraging more start-ups, not discouraging them i don't know how to get the policy exactly right, but i know that killing off that part of the economy is not going to make us stronger. >> yeah. speaking of start-ups, of course, tesla was once one elon musk teasing this special upgrade over the weekend to the new roadster supercar, hinting

the car may be capable of briefly flying with a price tag of a quarter million dollars how's this getting talked about out there? >> well, i can tell you, if you drove down the street that goes to my house, you know, 0 to 60 in two seconds, whatever that thing does, you're going to hit a pothole and be flying for sure i don't think you need that car. at that speed anything would fly because the roads have all these potholes in them listen, i think elon musk is the most entertaining, wonderful entrepreneur of our time, and his ability to change the subject is simply without peer obviously, there are issues in the manufacturing side relative to the model 3, and at the end of the day he's got to be able to make those cars, but it is just unbelievable how he comes up with these ideas. and he does deliver them he has trouble manufacturing lots of volume >> unbelievable -- we might have hit a top in elon musk's self proclaimed hype when he's talking about a flying car,

which is an idea that he himself pushed back on not too long ago. really >> listen, carl, i'm completely with you, but he's so much fun to watch and the reality is, tesla is an amazing brand. the products are extraordinary, and i totally get the enthusiasm i do also, though, as an investor, look at this and go, dude, you got to figure out how to make the model 3 and ship them you've collected all of these deposits, right? and he's probably going to be collecting deposits for flying cars, too, and at some point you've got to deliver against them i have no doubt he'll figure that out, and i just hope he does before investors get tired of him i just love the man. >> stock is up >> we're down 21%, roger, from the september high >> i know, but the stock's still $300 you know, you look at this and you go -- it's not like he doesn't have more room on the

downside i simply look at this and go, if you look at the overall moves in the stock, 20% is practically at the noise level. it is -- he really is an amazing entrepreneur, and, you know, you sit here and he's one of those people that, you know, if you had today's bias on immigration, you know, we might never have gotten him and that would be tragic so i look at elon musk and just go, you know, you go, dude i hope he figures it out again, i'm not a player in the stock, because i don't get cars, but he is just a delight he's the p.t. barnum of this day and age and i just love watching him. >> yeah, barnum thing sort of gets read both ways, roger i think your point's well made >> i think that's exactly right, but the truth is, he's extraordinarily entertaining and he makes great cars. and that's a hell of a combination in this economy. >> roger, good stuff good to see you again. >> always a pleasure >> roger mcnamee >> have a happy thanksgiving,

everybody. >> same to you, same to you. when we come back, uber unveiling a partnership with volvo. how the ride-sharing firm stepping up its push into driver-less cars that 6 billion chip deal in the marks with marvel. and the war for amazon's new hq continues. we are live in one of the cities with a pretty good shot, they say, at scoring atth highly coveted deal when "squawk alley" returns. ( ♪ )

whoo! ( ♪ ) woman: class, let's turn to page 136, recessive traits skip generations. ( ♪ ) molly: i reprogrammed the robots to do the inspection. it's running much faster now. see? it's amazing, molly. thank you. ( ♪ )

some breaking news on that

keystone pipeline. the xcel finally got approval from nebraska regulators basically was the last major hurdle in connecting this pipe that goes all the way from alberta down to the texas gulf coast. interesting, guys, nebraska regulators were not really allowed to factor in safety, despite the spill we had in the last couple of weeks, because that's the purview of the federal government this is going to be a big chance for the white house to claim a win as keystone is now possible. >> a lot of people have been waiting a long time for this one. >> and we'll see whether it's a job creator, that's the argument they've been pushing for this. in the meantime, out to julia boorstin good morning, julia. >> good morning, sara. theater stocks with another disappointing weekend with warner bros. falling short of expectations bringing in just $96 million over the weekend in north america. that's $14 million less than analysts expected. amc and imax shares are both

down over 3% regal and cinemark down over 2% after stocks made gain on friday hoping justice league would lead a box office turn around box office still down 4% to date back to you. >> hoping for another avengers, looks like they got another fantastic four thank you, julia potential consolidation, at least in the media industry, showing importance of owning content in deals like at&t plus time warner and fox plus someone, perhaps on the growing importance of programming and tech platforms, joining us dominic del por vendi content chairman last saw you in barcelona and at the time snap was about to go public and you were bullish on it >> i'm still bullish >> okay, explain >> because i think every platform has a dna, and the dna

of snapchat is very different from all the other platforms engagement is unique, 70% of the people on the platform are producing content every day. this is, again, unprecedented. then, disclosed 12% in the platform and when you are backed by a chinese subscriber with 800 million subscribers, you can be quiet and not too worried about your future. >> i appreciate the double down. you are working on shorter form content, ten-minute kind of high grade content. it's familiar. you're not the only ones, you know, jeffrey katzenburg also trying to raise money to do the same why is that important right now? >> i'm sure jeffrey will agree, we were first in that race and when i present the first prototype, he loved this, great

job, go on it will raise $2 billion, but when we start two years ago, the idea was that 70% of the conception of video would be on mobile that's already the first treat and there is no premium content designed for mobile. there's a lot of content and we can watch you guys, we can watch the late show, comedies, sketch, so on, but when it's about premium scripted, nothing has been done. that was our statement let's do this. let's create a new format, ten by ten, ten episodes, ten minutes and has producers and the new generation of creators to do something not as expensive as "game of thrones" or the biggest tv series, so we are literally less expensive than jeffrey's project, which is $100 a minute we are producing premium shows the great news of today is we've been nominated for the emmy award, it's going to be tonight,

but out of the four premium short series, two of them are from studio plus, and we launched the app last week in the u.s. today we're 5 million in some countries in europe where we launched ten months ago. it's a long-term project, long-term bet, but we're convinced there is a new market for this content >> when we're talking the cost of production and marketing, 100 minutes is a movie >> absolutely. >> is it comparable to a $10 million movie? >> yes you can do great movie with less budget than the justice league moonlight has been awarded with a $1.5 million movie i see the economics are changing and they have to, because blockbuster doesn't mean necessarily a huge return. what we're trying to do is bring on the new generation of talent to produce in a shorter time period, as well. it's a ten-month project, so huge preproduction, shooting of four weeks instead of 16 weeks,

so everything is, but for the audience it's a great intimate show >> would you expect consumers to watch most of it at once >> what we have seen already with our first subscriber is the user downtime, like commuting time, one episode on one way, the other episode on the other way, in a way people are overwhelmed. it's all the tv series they have to watch and they can't stay all night long watching series we enable them that indulgent time >> hi a question for you about the advertising world and the megamergers being discussed, at&t-time warner if it's allowed to go through. >> i think what we need to understand is the consequences of the two world there is a free content world and paid content world the paid content is subscription base wants to launch a new netflix platform in one year and moving

like the paid tv world where your question sits with a free content world. all the content that is fully funded by advertising. what we have to see is that tv is still a 70.11 billion market in the u.s., and i know the google and facebook of the world are obsessed by tapping into that big amount of money to fuel their growth, so i don't know what's going to be the consequences of the mega merger, but for sure, two big players. >> so what do you make of what's happening with the likes of buzzfeed, which has grown huge i believe nbcuniversal and comcast has an investment with them, but they are missing revenue targets in a way people didn't expect. there seems to be pressure in the digital content business on the cost side and revenue growth side how's this going to shake out? >> there was an article last week about that. i think, yes, it's true.

google and facebook are literally representing a kind of monopoly it was 103% of the growth last year in digital, so it's very hard for users to find revenues. what you need compared to buzzfeed is having a multiple stream revenue like vice where you do digital, tv, content, and original that you can sell with your broadcast network all over the world. so you need to have these multiple revenue streams because digital only is going to be tougher and tougher. >> some tried to blame buzzfeed's troubles and mashable's troubles on the pivot to video do you think that's going to end up looking smart or not? >> i think that if you are just producing text and picture, it's going to be tough times. as i said, 70% of the video conception will be mobile and video will eat the next five years, so you need to produce content. probably when you look at valuation, be sure that the

company is good at understanding new content, like snap, producing originalcontent like vice, and the other features that will be absolutely key to be successful in the coming years. >> well, selfishly we believe in video, too live video especially. always great to have you dominic dell por, thank you. coming up on "squawk alley," more consolidation in the semiconductor center we'll discuss marvell tech's $6 million bid. both stocks for cavium on the move higher. quick check at the markets, dow's up 83 points, so we are coming back after a down week for the dow and s&p. stocks like ibm and 3m leading the charge there s&p 500 up fractionally 3.5 points we'll be right back.

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headquarters project not a word from the company except to say it's received proposals from 238 different communities. scott cohn is one of them, raleigh, north carolina, as he continues to handicap this race for amazon hq2 scott? >> hey, john you know, north carolina has always been competitive, ever since we started ranking the states more than a decade ago, so it's no wonder that when it comes to amazon's hq2, the state has gone all in for bids in raleigh, durham, chapel hill, the triadd of greensboro and charlotte and hickory. the big metros come in with a "b" overall on attracting and retaining talent because of the state's longstanding issues with diversity and inclusiveness. hickory is a few hundred thousand short of the population requirement of a million people, so it slips to a c-minus overall. nonetheless, strong ratings here and what we're doing is

basically looking at amazon's publicly stated criteria, the request for proposals they came out with in september, and applying data from our america top states for business data we don't know if our methodology is necessarily anywhere close to what amazon is doing as it goes through all of these bids, but it's fair to say, again, based what the company has said publicly, if you're making bets on this, you should be looking south. in addition to the "b" overall from north carolina or the big metros here anyway, atlanta, austin, nashville each get a b-minus, favorable regulatory environments also look at the washington, d.c., area and particularly the northern virginia suburbs with a b-minus, as well no area that we've looked at, stumbled on, looked across, evaluated thus far, has done better than a "b." we're going to keep looking, though we've got report cards for two dozen areas at cnbc.com, and later today we'll be talking

with north carolina governor roy cooper that's on "power lunch." he's trying to convince amazon this is a diverse and inclusive state, even as he tries to convince the legislature to make the state diverse and inclusive. guys >> scott, we've had jim stewart of "new york times" pick pittsburgh, "the journal" did a matrix of variables and saw dallas in the lead i'm not going to get you to tell us what you think is in the lead, though, am i >> well, i mean, you can look at what we've looked at thus far, this is a grading scale. there's a lot in the "b" range, a lot of it's in the south that should be something to look at atlanta does well on an irish betting site, it also does well in our grades, but again, we don't know what amazon exactly is looking at. we know what the criteria are and all that we or anybody else that's evaluating this can do is look at that and take an educated guess >> scott, i'm just recalling the

bathroom law caused a lot of controversy and business to pull out. obviously, they went back on that have they won business back as a result of that ordeal? >> well, some of the boycotts went away, the ncaa tournament and things like that, some of the boycotts have been generally reversed, but there's still a lot of concern and a raging debate here. and we'll ask the governor about that, a raging debate about whether the state does need to be more inclusive and allow some local protections. >> scott, good stuff as always it's been fascinating to watch you make the tour of all these candidates scott cohn today in north carolina let's get to seema mody back here at post 9 watching the european close seema? >> hello, carl european stocks beginning the week mostly higher and this includes germany, despite the surprising collapse of coalition talks in that country, dealing a huge blow to chancellor merkel germany's president is calling on all party leaders to resume

talks to form a government the euro has been volatile, but basically unchanged, slightly lower against the dollar in reaction, though, to this dilemma that merkel now faces, ba barclays says if germany decides to hold new elections, the outcome is likely to differ from september results, but surely a developing story in germany. moving on to stocks, roche is up 6% regarding its drug for lung cancer altice up 5% after announcing plans to pay down its massive debt selling non-core assets as opposed to issuing new equity, and hsbc initiating coverage of thomas cook and tui, there's an expectation that with an improving european economy, consumers will travel more lastly, we've got to keep an eye on turkey, because persistently high inflation continues to be a concern. add to that tensions with the united states, and looking at

the turkish lira falling to its lowest levels seen since the start of the year. guys, back to you. >> seema, thank you very much. seema mody let's get a news update from sue herera, as well. >> good morning, carl, good morning, everyone. here's what's happening at this hour "the new york times" suspending its white house correspondent after accusations of sexual harassment "the times" saying his behavior is very concerning and not in keeping with the standards and values of the newspaper. former white house communications director anthony scaramucci in israel this week as a guest of the orthodox jewish chamber of commerce he told the associated press that he remains in close touch with the white house, although he hasn't spoken to president trump in over a month. >> when i do speak to him, it's very privileged, but i probably haven't spoken to him in over a month and a half or something like that. i don't speak to him as regularly as i speak to other people inside the white house.

i have a very good relationships there still. >> iranian leader ito la khamenei visiting the earthquake stricken region advocating for more aid for the people in that area the quake killed more than 500 and injured thousands more that's the news update this hour, back downtown to "squawk alley. carl, back to you. >> sue, thanks a lot as we go to break, big pharma making big moves. check out shares of roche, positive drug data sending the stock higher, "squawk alley" will continue in a moment with the dow up 86. it's a small finger...a worm! like, a dagger? a tiny sword? bread...breadstick? a matchstick! a lamppost! coin slot! no? uhhh... 10 seconds. a stick! a walking stick! eiffel tower, mount kilimanjaro! (ding) time! sorry, it's a tandem bicycle. what? what?!

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keystone xl pipeline gets approval from nebraska moments ago, clearing a key hurdle in the almost decades-long process. jackie deangelis is watching that back at hq. >> in a 3-2 decision, nebraska regulators voted to clear the way for the project. this was a controversial decision, because nebraska was the last state that needed to approve construction after president trump gave the project the federal green light back in march. it wasn't clear what was going to happen here the legislature and the labor groups were pushing in the affirmative. the environmental groups, of course, were against it. adding to all this, 210,000-gallon spill from part of the pipeline in south dakota last week, creating a little bit of a gray area a lot of people didn't know which way nebraska was going to

go, but clearly they do want the pipeline to proceed. >> yeah, we see the reaction in transcanada shares up 2% jackie, thank you. >> sure. it may be the transportation technology of the future, but denver is hoping to make hyperloop tech a reality on its city streets by 2021 with the help of a company called arrivo. joining us now, cofounder and ceo, also cofounder and former cto of hyperloop 1 welcome, brogan, back to the program. tell us, you're bringing the hyperloop to denver, how's it going to work? >> good morning. we have a unique take on the hyperloop we think is going to be more commercially viable and increase regional availability. regional mobility and unlocking new opportunities to move around the region, that's what arrivo is focused on. >> so how fast can you go, and is this the hyperloop we talked

about where it's the sort of wind sucking tunnels that trains and cars go through? what are you looking at? >> so, our technology isn't speed limited, but to be commercially viable it kind of is speed limited, so we're aiming for around 200 miles per hour it probably isn't the hyperloop that you thought of. the original white paper was in a vacuum tube with pods with compressors in the front and air bearings we're focused on a high throughput system, so for us the key is more vehicles moving more miles in the region, just to put a quick number to it, an average freeway can move around 2,000 to 3,500 vehicles per lane per hour we can move 20,000 vehicles per lane per hour, so you're talking about unlocking a whole region's mobility >> wow people are willing to do it, i guess, if they are not too freaked out by it. who's funding this effort? >> you know, we're privately funded right now, and we're going to be going out for our

series "a" funding in the near term and i'll be happy to talk about that when we get that. >> brogan, how many people have to be willing to use this corridor, say, between boulder and the airport and how much do they have to be willing to pay for this to be financially viable long term >> just to put it in perspective, there's a current toll road in the denver region, e-470. they are a partner with us on this study and our pricing is the same as that e-470, so that's about $5 or $10, depending how far you go so it's going to be, you know, very available for everyone to use. you know, i don't think we're going to have to encourage people to use it i don't know too many people that want to spend more time in traffic. so if you can really think about getting to any part of the entire region in less than 20 minutes in a super smooth ride, sounds pretty appetizing to most people >> i'm from denver and went to college in boulder and driven that road, 36, many times. denver, i can see a lot of

things about the area that make it attractive to make something like this, but what about weather? the seven feet of snow, how much of this technology's vulnerable? >> well, in fact, you know, while arrivo is not in a vacuum tube, we put it in an enclosed environment that keeps weather off it, wind sheer off it, keeps tree branches and soda bottles off it, so that allows this combination of high speed 200 miles an hour and really high throughput, so, you know, also want to point out when you're in the system, whether you're on your own car you've driven on to a sleigh on the system or whether you're on one of our super metro vehicles, it's going to be smooth as sitting in a chair because of our levitation technology we can actively ride smooth, so it's going to be as smooth as sitting in a chair >> we talked earlier about elon musk, who i know you previously worked at spacex, but elon musk teasing a special upgrade for his roadster car, suggesting the capability to fly. are we going to need these if

we're going to have flying cars? are we going to need the hyperloops >> i'm pretty sure he was talking about short hops and something that's going to be fun to do. you know, we do think at arrivo it's going to be needed. obviously, autonomous cars are connecting, connected autonomous cars are coming. we think that's going to increase desire to move on the freeways also populations are growing in certain regions, people are urb urbanizing, this high throughput concept we have is going to be incredibly needed and very welcome. >> what sort of regulatory approvals do you need to get to make this work and how much interaction do you have with the local government to build this and make it safe for passengers? >> we absolutely want to be safe we love regulation, we just want the right regulations, so the colorado department of transportation is also a partner in this study. they are going to help guide our regulatory process through the national level also on our team, you know, we have people that have led, you

know, worldwide mobility think tanks and driven these kind of procedures, so we plan to be stepping into true certification testing in 2020 to be operational by 2021. >> carl, you should go test it out. >> meet you there, brogan. >> brogan, thank you >> it's going to be fun. thank you. >> arrivo's cofounder and ceo. and in a market that's run up this much, investors are looking for signs of trouble ahead. dominic chu is here to explain why people are watching the market for clues dom? >> john, junk tech markets could be one of those big warning signs, precur whisors across no just stock markets, but other markets, as well if you look at the spider high yield junk bond etf, some of the biggest holdings are in companies that have been under pressure from a stock perspective. according to state street global advisers, high yield debt

holdings in companies like sprint, community health systems and altice are among the fund's biggest holdings, but right now a lot of traders are saying maybe last week's negative price action wasn't perhaps as big of a sign of overall market weakness one of the reasons is that high yield bonds and stocks of the companies that issue them, they aren't really diverging in a way that could cause alarm barclays head of credit strategy looked at bonds in that high yield bond index and also the publicly traded companies that issue them he found that bonds and their corresponding stocks aren't trading that much out of whack with historical patterns another interesting point comes at academy securities who doesn't think that high yield debt is all that correlated to the large cap s&p 500. it might be better to look at trading relationships to the smaller cap stocks in the russell 2000 index many of the companies that issue some of those funds from the junk bond market are smaller, more domestically focused, as well

that's not to say junk bonds won't be a sign of problems ahead, but still may be a ways away before real worry happens back over to you >> all right, dom, thank you very much. dominic chu. as we go to break, check out shares of etsy higher after the company announced a $100 million buyback over the weekend shares up more than 1% dow's up 90. "squawk alley" is back after this

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i'm scott walker coming up today top of the hour on "halftime report," how another change to the senate tax plan could leave individuals and investor in stocks paying a big price. larry kudlow, original architect of the administration's plan will join us live alongside "mad money"'s jim cramer, who's with us for the hour today. can't wait for that. plus, did two dow icons hit rock bottom? somebody here thinks so. we'll hit ge and ibm in the calls of the day plus where cramer sees the most value right now. ha "halftime report" ten minutes time >> jim's feeling good about the eagles game last night >> rightfully should be. >> see you in a few. headlines from the beginning of a cabinet meeting at the white house. the president says the u.s. is designating north korea as a state sponsor of terrorism eamon javers is at the white house with all of that >> that's right. we're just getting the headlines now. the cabinet meeting is ongoing at the white house

the press pool has gone inside and we're getting reports out. we should have tape momentarily, but we're also told from headlines crossing the wires that the president says the designation of north korea will impose further sanctions and penalties on what he calls a murderous regime in north korea. the president also says the treasury department will announce further sanctions against north korea on tuesday so we'll wait for the treasury department to give us more in terms of the specifics on who here is being sanctioned you remember that the president has been anxious to work with the chinese leadership and was apparently very optimistic after his trip to china last week, that the chinese were going to send an envoy to north korea, that there would be follow-up on the chinese side, so one of the questions here in the immediate after math of the headline is whether or not this has been coordinated with the chinese government or whether this is something separate we'll try to get answers from the white house as soon as we can get them carl >> eamon, we'll look for that

tape and from you in a moment. let's get the santelli exchange with rick over at the cme this morning. rick >> good morning, thank you, carl you know, we've gone from an era of policy questions to policy knowledge. even though it might be very general. consider the last year. very gel consider the last year policy with regard to repeal and replace, taxes, regulations. there weren't a lot of specifics, and even when it comes to the health care side it was mostly felt, volatility, that by companies directly in that sector, but generally speaking, whether you looked at university of michigan, consumer confidence, regional fed indices or just the stock market in general, it was the generality of policy that was the baseline. what do i mean you're not going to get more regs, and every reg that comes on has to see regs die with regard to taxes, we went through quite a period where general public looking at this administration could tell one thing for sure, they definitely didn't want to make taxes more

burdensome generically, so all in all the generalities of policy were a real tailwind forth markets, and for the better part of the last year illooked at markets, looked at regarding politics and policy and really don't see the threads that many other saw, but a lot of that has changed. we've gotten some very specifics on tax policy, and that has caused some very specific behavior modifications by investors. we had andy brenner on today, and he isn't alone in specifics to tax policy. specifically 35% down to 20% or thereabouts on corporate taxes, and that specificity has hall altered behavior in many areas what investors are trying to do in 2017 what will change in 2018 and one of those unintended consequences has been pensions, pre-funding and the purchase of trishries. now, we all know there's a lot of reasons long-dated treasuries

are purchased that don't have a direct influence on the fundamentals of the economy that normally make rates move up and down so i guess what i'm saying is these direct effects are now making more and more headline vulnerable moves in the markets. now, that might sound just, well, of course, but it also leads to some many binary changes that occur in 2018 so whether it's how angela merkel and her political issues of the day forming a coalition or one's tax policy is changed, how the long end moves or doesn't move and generally, how the ecb and corporates and high yield gets folded in that means generally this is all for lower rates, and should the remaining in the remaining six, seven weeks of the year try to get back boflt high close we had three weeks ago at 2.46 which is a higher yield than last year?

i would certainly think that the following move once that occurs would be bigger than it normally would. jon fortt, back to you. >> thanks, rick santelli as we hit to break, bitcoin hitting a new record high, breaking through 8,000 for the first time look at that, 8,222 bucks. now, you know, seeming to head higher and higher. the market cap, if there is such a thing for a crypto currency acng13biion makes it more valuable than mcdonald's. kind of. "squawk alley" back in a moment.

tremendous respect people are respecting our

country again, believe me. we brought back more than $300 billion worth of deals which could reach well over $is trillion within a very near future that means jobs for the united states at a very high level. as you know, we've just come up with the best job performance in over 17 years. but this is a lot more jobs. we think the numbers will get a lot better we also will put people who have not been able to find jobs, we'll put them back to work because they are not registered right now. they will be registered in a positive sense japanese car companies will be opening up and expanding their plants in our country. wing worked very closely with prime minister abe on that we're renegotiating our bad trade deal with south korea, and we eve started talking about bilateral trade with many countries in asia and most

importantly we've made clear to all countries that we cannot continue to be treated unfairly when it comes to trade any longer it's not fair to our companies, and it's not fair to our workers. last year we lost over $800 billion on trade, on trade deals with other countries, so we had a negative number, a trade deficit of almost $800 billion with other countries that's not going to be happening. that's changing. and i explained that to them from the standpoint of asia. they are understand it every one of them understand it. one of the primary goals of our trip was to pursue the denuclearization of the korean peninsula. i want to begin this morning by meeting and by talking about the fact that we will be instituting a very critical step, and that

will start right now today the united states is designating north korea as a state sponsor of terrorism it should have happened a long time ago should have happened years ago in addition to threatening the world by nuclear devastation, north korea has repeatedly supported acts of international terrific, including assassinations on foreign soil as we take this action today our thoughts turn to otto warmbier, a wonderful young man and the countless others so brutally affected by the north korean oppression this designation will impose further sanctions and penalties on north korea and related persons and supports our maximum pressure campaign to isolate murderous regime that you've all been reading about and in some cases writing about. tomorrow the treasury department will be announcing an additional sanction and a very large one on

north korea, and this will be going on over the next two weeks. it will be the highest level of sanctions by the time it's finished over a two-week period. the north korean regime must be lawful it must end its unlawful nuclear ballistic missile development and sees all support for international terrorism which it is not doing today cabinet discussions will also focus on crucial domestic policy issues. i want to congratulate the house of representatives for passing a vital and historic tax cut last week, and i'm very hopeful the senate will do the same very soon we're going to give the american people a huge tax cut for christmas. hopefully that will be a great, big, beautiful christmas presents with the democrats giving us no votes for tax cuts for purely period reasons, obstructionists, it will be up to the republicans

to come through for america. i think they will. i hope they will it's up to the senate, and if they approve it, the house and the senate will get together i'll being there right in the middle of it, and we will come up a bill that will be spectacular for growth and spectacular for the people of this country our tax plan will bring urgent relief to hard working families. it will reduce rates and increase the amount of income taxed at a rate of zero, expand the child tax credit, very important, and simplify taxes as most families will be able to file on a single sheet of paper. we'll restore america's competitive edge so we can bring back our jobs. we want to bring our jobs back to our country we were decimated over the last 40 years we want to bring our jobs back to the united states we'll go from being one of the highest taxed nations in the world to one of the lowest