live from new york where business never sleeps, this is "squawk box. good morning, everybody. welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm becky quick with andrew ross sorkin joining us is guy adami. bringing coffee for the troops. >> i try to spread joy first time on the new set, love it we used to do the show from here >> great to have you here today. perfect day to have you here because of what's been happening with the markets this morning. folks, check this out. take a look at u.s. equity futures. after the massive gains we saw last week where the dow was up 2.9% gain of 673 for the week futures indicated up by 218 points above fair value. s&p futures up and nasdaq up by 32 right now

overnight in asia, you're going to see what's happening. we'll talk more about what's happening here with the futures. overnight in asia the nikkei down by 1/2 a percentage point the hang seng up by .2%. the shanghai composite down by a similar amount in europe this morning with the green arrows there, you're going to take a look and see that gains across the board dax up by 1.25%. cac up by .9%. crude oil prices, take a look at that, too. last week for the week they were down by 60 cents down this morning another 55 cents to $57.82 for wti. >> you think you can keep bringing things in here and -- >> yes. >> driving your -- >> yes. >> -- to -- >> that's exactly what i think. >> because you can. >> because i can. >> that definitely is -- >> i try to spread cheer. >> grat grasso messaged me, i'mt

on -- >> you're trying to create tension. >> you bring me like back -- you know -- >> remember your thumb was sore and i got you some epsom salt. >> and today you brought coffee. that's a way to do it. >> he's the man. >> i'm half italian, half sicilian. >> that means don't cross him. >> you're threatening me >> no, there's no threats whatsoever you'd know if i was threatening you. >> go ahead. read on. >> our big corporate story cvs health will buy aetna for $69 billion. made aetna a deal that they couldn't refuse. >> nice. well done. >> cvs ceo larry merlo and aetna ceo mark bertolini will join us. let's bring in bertha coombs she joins us you've looked into this because

you were like, i need help some of the nuances. i don't understand exactly why this is going to help. i don't know if this is defensive or offensive >> it's both it's both defensive and offensive. cvs wants to get out of the business of being a middleman. $69 billion. this would be a record health care deal valuing aetna at about $205 a share 13% premium to friday's closing price but investors would get $145 in cash for that, 67 in cvs stock. cvs has already secured promises from financing from its banks and expects the deal to close in the first half of next year. for aetna coming off of a block deal to acquire humana, this transaction is one of the only options really to leverage its assets and scale up as an insurer. for cvs, it's transformative buying a rifle wouldn't have done it but kept them in the middle this gives them the assets they

need to offer a diverse health care option and provides value the combined company would make them really sort of the biggest firm by revenues if you look at their 2017 estimated annual revenues they have about $240 billion on the top line they have 22 million for sure from aetna 90 million in pharmacy benefit customers from cvs and they also have home care services. there's 1100 in store clinics and of course nearly 10,000 pharmacy locations when you look at it side by side, if you move over to united health and look at what united health has it makes them comparable in terms of size and they'd be able to really compete on being able to offer a full service package to large employers to the government and really pull out some of that middleman excess and offer true value and really be able to talk a lot to the pharmacy guys, the pharma guys and perhaps extract

better pricing. >> the middleman, that's what they're messaging to say it will be good for consumers. >> yeah. at the same time, what happens now is you've got some large employers, for example, contest. we have insurers and then we have the pharmacy benefits separate now you're going to get potentially aetna, cvs together and united health saying, you know what, we're really going to want you to keep those two together we don't want you to do it a la carte. you'll pay a price for trying to have more competition and use the different pieces separately so for employers it's to kind of box them in, to have to go with one or the other. >> one solution off the shelf versus trying to shop around, right? right now we have -- we used to have aetna, we don't we have united health. >> we have united health and cvs as the pharmacy benefit. our company decides to do it a bit more a la carte.

other companies have gotten more benefit from being able to use the optum side of united health and united health benefits that's one of the things that has helped united health to grow the other thing to think about is you'll have this deal in the works. there's a lot of sort of moving parts going on in the pharmacy benefits space at the moment because anthem wants to start its own pharmacy benefits unit and they don't want to work with express scripts anymore. so if you're sitting here right now as a large employer looking at what you're going to do for 2019, you're going to have anthem in transition, you're going to have cvs and aetna kind of trying to put it together and work out the kinks as one company together and then you have united health that already has the one single option. so some benefit managers say once again while their partners are trying to make big changes or, rather, their rivals are trying to make big changes,

united health continues to go in one direction. amazon >> amazon is part of this here in terms of perhaps if they really do enter the pharmacy space, but more likely amazon would enter the generic space. that's not where the profits really are because at this point a lot of folks could offer generics with those cash payments of $4 you don't necessarily have to be in network. >> although amazon's probably a factor just in the retail end of cvs, too. >> exactly in the retail end. now cvs becomes much more of a health care play and retail. they're a health care play with retail that's what differentiates them from united health. >> the front end got less attractive for those guys. >> but they want -- they want to leverage their retail to be able to say we're also going to deliver from our pharmacy stores to your door and given that they're almost in everyone's neighborhood, that's a proposition. >> amazon wants ai to diagnose

me and i want the web services to automatically send stuff to me that is monitored by a little pharmaceutical with the sensor on it. i mean, that's -- >> that's what they're all trying to get to. >> they are? >> they all are trying to get to utilizing ai, utilizing whether it's the apple watch or your blood pressure cuff and amazon is trying to utilize all of that data and -- >> right >> -- do it through voice through alexa. >> we're not quite there yet. >> it's not quite there yet but it's starting. >> adami, how are you feeling today? >> feeling great i know intuitively how i feel. i don't need a watch or a cuff. >> did you take any pills today? >> none whatsoever, young man. that's a loaded question i don't know how to say that. >> as long as your blood pressure is okay you can have high blood pressure and not know it. >> the silent killer they call that. >> statins >> no. try to live a healthy, clean life no booze. you no he what i'm saying?

no smoking >> what? >> i'm just telling you. >> you never drink >> once in a while i'd be more than happy to have one after the show with you today. >> at 9:00 a.m bertha, thank you. joining us on the squawk news line is brian tingle. he is the senior analyst thank you for being with us. >> thanks, becky >> we knew this deal was very likely to come what do you think about it now that you know the details? >> it's the worst kept secret on wall street for the last few weeks. as we've learned more about it it's a better deal than what a lot of people expected, at least from the aetna side. a lot of people thought this would be a 50-50 stock and cash deal so i think that came out a little better. the synergies of 750 million, they look pretty good. i think those are attainable but i think the key here is going back to what bertha was saying, i think what these guys

are doing is playing offense and defense. playing defense on the other hand, again, you guys talked about amazon the front end is -- it's almost like a foregone conclusion that amazon is hitting them there it's pretty good to see that this is a strategy that could help them play, like i said, both sides, offense and defense. >> when you say it's a better deal for aetna shareholders because they're getting more cash out of the deal, that implies that you don't want more stock, that you don't have faith in the long-term strategy. is that the wrong assumption >> well, my concern with having a stock heavy deal is twofold. number one, to make a deal creative within the first two to three years you need a much higher level of synergy if you offered more stock the second part is, you know, this is an execution dependent transaction where you really are transforming, you know, health care in general, right you're transforming these stores there's a lot of execution to risk associateds with that where you have to convert the footprint, there's a lot of

investment to go into that if you're an aetna shareholder you're getting a good chunk of cash up front. it derisks the story for you a little bit longer term i like the deal. i think this is the right thing to do for the health care system as a whole again, there are risks near term it's transformative. there are lots of moving parts that we have to consider. >> brian, real quick i know joe mentioned amazon. does this force walmart's hand does it force walmart to go and maybe make a play for humana >> that's a good question. walmart has tried to get into health care. they tried to do a pbm like business as far back as 2010 if i remember right they've been looking at ore ways to get into this business, especially the pharmacy benefit management space they have a relationship with humana i don't think it necessarily forces their hand to do a deal but maybe to broaden the partnership, deepen the

partnership with humana is what i would expect. >> brian, thank you for joining us this morning. we appreciate your time. >> thanks. by the way, folks, don't miss our exclusive interview with larry merlo and mark bertolini. they'll be here at 7:00 a.m. eastern time. media giants disney and 21st century fox have apparently rekindled some talks wall street journal reports that a deal by disney to purchase some of fox's assets is gaining momentum the report also said cnbc parent company comcast remains in the mix. the talks centered around fox's movie and tv studio, its international assets and some u.s. cable networks, fox news and fox broadcast network including sports are not expected to be sold in the transaction. meanwhile, washington republicans in the senate passed their version of a tax reform bill early saturday morning. now the house and senate go to work to reconcile different versions of a bill

ylan mui joins us after 700 points last week, 200 indicated this morning on the dow. up 33% >> yeah, joe, it is a sprint to the finish now republicans are focused on resolving the differences between the house and the senate bill these are really three big ones. the individual rate is one the house has four individual and the senate has seven the corporate rate, the house cuts that to 20% right away. the senate waits until 2019. the senate of course repeals the individual mandate in the bill the house doesn't and it's still unclear how moderates in congress will feel about that approach there are also a bunch of smaller issues that could wind up becoming bigger battles down the road those include -- those include -- those include keeping the alternative minimum tax in

the senate, that also includes repealing the estate tax in the senate as well and there are also different rates for pass throughs and for businesses. now none of these seem insurmountable and it is worth noting that not one chamber is howling about what the other chamber has done so there are some areas of negotiation to be had. also this weekend, president trump did open the door to edging the corporate rate up to 22% in the final version of the legislation. that would make this math easier republicans had bent over backwards to stay within what was supposed to be that red line of 20% and i haven't heard anyone talk seriously about abandoning that 20% rate just yet. so the next step in all of this is a conference committee. the house will vote on members today. the senate will follow suit on that soon and most of that process will happen behind the scenes they call it preconferencing and it's already happening republicans will likely need right up until december 22nd to

make this bill happen. back to you guys. >> right up until december 22nd for the conference or to get the bill passed in both houses >> to get the bill passed through both houses. congress had been set to go on recess until the week of the 18th looks like they'll need to stay in session both to pass spending legislation and keep the government open as well as to ensure they have the time to work through all of the processes on the tax bill. >> ylan, markets are obviously heartened by what's happening. one of the things i think is that trigger would have never passed muster in the house so, you know, the corporate trigger, so losing him, it was always like, oh, my god, he's going to be three, who knows with mccain and flake. flake's going to flake, you know, but once everybody was on board, the trigger -- totally he was the only guy holding it up based oen that. >> reporter: right we talked about this on friday, joe, sort of the strategy that emerged then was just to let

possibly flake and corker as well go. i thought it was really a classic mcconnell move that you saw other issues like daca being brought in to address jeff flake's concern and get him on board. they had not only enough votes to pass but a spare. >> funny to watch. mcconnell. genius, trump. scoff mitch. all of the guys a week ago it was like mcconnell's got to go nobody can whip votes up like mitch. go mitch. >> how come 22% -- what happened what was the thinking behind that tweet, the idea that 22% for corporate rate would be okay that prompted it or is that something -- >> that really came out of the blue, becky. i don't think republicans were expecting to hear that from the president, especially after they stayed up until 2:00 a.m. to make all of the numbers work to hit that 20% corporate rate i'm unclear if that is something that is actually a shift in the white house's condition. >> i'm wondering if that's something they wanted added to the bill. >> knowing the way people

negotiate and knowing especially trump -- >> if it's 1 or 2% it will be to help pass it. >> it doesn't surprise me, it surprises -- it doesn't surprise me to hear it, it surprises me to tweet it. i always figured he would sign something at 22 or whatever they got to his desk. >> might have been his lawyer tweeting you never know now plausible. thanks ylan mui. we're going to hear from house majority leader kevin mccarthy he's going to join us at 8:00 eastern. when we come back, again, the u.s. equity futures pointing to big gains at the open if you are just waking up, dow futures up another 220 points after the dow ended the week up 673 points last week s&p futures up by 17.5 nasdaq up by 35. the week's record breaking week for the dow talking about that and portfolio strategy also expectations for jobs friday coming up this week that's all next right here coming up on "squawk box."

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consumer sentiment those both come on friday. there are a few earnings reports due this week. that list includes autozone, toll brothers, h&r block and lululemon. >> record breaking week for u.s. stocks which could have been said 52 times maybe in the last year or so record-breaking week because there's been a lot of them looking at some of your comments, steven, your comments were that the market continues to go higher based on prospects for tax reform siemian, your quote here is it can no longer be said that stock prices do not incorporate some expectations of tax code changes. so you're one of these that -- and i know to some extent i remember, but you're one that has been saying it's global s k

synchronous growth the market is up 36% there's been deregulation, animal spirits, corporate confidence, there's been consumer confidence, there's been possible taxes. all along you're saying this was set up by a synchronous global growth >> all i'm saying is we had the last rally that's been coincidental with tax -- so tax reform might be seen as a positive by the market? >> of course tax reform is a positive for the market. my point is that before the last couple of weeks i would argue not much of that was built in. >> larry some morummers is goin on later today it's not obvious to half the country or half the political spectrum he's going to argue that it's -- thousands will die and that only rich people will get richer. >> this is like a company that

finds a gold mine on its property and you're trying to value the incremental benefit. let's just be simple minded about it the market is up 3 or 4% in the last couple of weeks that's a good estimate. >> so you also say that at this point you need to do the participate but protect strategy is there any time in the last year that you weren't participating and protecting if you embraced this move with both hands the entire time, it's been cheap the entire time and going up 33% or have you been hess tent to buy into it nkts the gap between growth and value had gotten quite large. >> what does that mean >> growth stocks are at twice the value of -- >> so you're worried >> i'm worried about the growth side for the last six months or so on the growth side of the equation. now there's been a little bit of a catchup. this power full rally -- >> we're still cautious but stay

long with dividend stocks? >> the opportunity now is to rotate to quality stocks which are keeping up with value but tonight offer the down side risk of the valuation of growth. >> significant business incentives for the united states in this tax plan fair enough, this is the only tax cut we're going to get so at some point we will move onto the environment generally and it's going to be a pretty good one. probably some of the strongest growth across the world that we've seen since 2010 and the u.s. will be part of that. >> part of it? why isn't the u.s. a major part that's leading the rest of the world. >> it is a major part of it. >> biggest economy in the world and if we're suddenly growing at 3% plus, that adds into the global -- it's not a result of the global growth. >> no. >> it's part of the global growth. >> it is it's going to benefit the world, but the larger delta is economies that in 2016 were contracting. we are talking about a country like brazil, just one of the britts, for example, that was outright dropping for three years and has had its first year of growth is moving on to a vong

ger recovery the united states will have a step up and it will be tax driven and the rest of the world is excacceleratinaccelerating. >> do you see a year of 3% plus growth how many quarters. the three three we got was affected by the hurricanes at least half a point. >> yes. >> that would have been almost 4% is it on a trajectory? >> it will be a step up. who knows about the first quarter. some of the taxes, is this 2018, is it 2019 business incentives have clearly improved we'll see if we have that usual first quarter slow down, but to step up half a percentage point over the coming year i think the more important thing is that the declines that we would get in the u.s. dollar, those things will be stabilized, that we're going to have productive incentives, more tax code and fortunately enough the rest of the world is in an earlier phase of recovery.

we could be quite optimistic as investors generally. >> is it long in the tooth in your view? >> i think you can't say the united states with profits that have already tripled is at the beginning of a brand-new recovery set back will come eventually, but it doesn't look in the cards in 2018. we'll take that it's 2018 by any means and i have an open mind about 2019. >> i mean, all of this, siemian, has been happening as at least we passed the inflection point on easy money. i mean, this is -- this last year and a half all we've been talking about is the fed is tightening they ended qe. you know, the balance sheet is being unwound. they're raising, you know, occasionally, not a lot. 33% move in the dow has been in the face of higher interest rates. >> yeah, that's right. there are other signs of snugging up of capacity as well. >> right. >> last quarter you had 5% earnings growth and 10% bonds -- excuse me, 5% sales growth and

10% earnings growth. now you're down to 5% top line and 7% bottom line so that's some indicia of snugging up capacity there will be increased inflationary ple inflationary pressures in 019. >> when the dow was based on low rising interest rates but when it rises on the possibility of -- >> this is incredibly low, historically low interest rates. >> you get 3% plus and then suddenly -- 33% in the dow, that's like -- that's trillions of dollars. >> this is why we're saying that there is tax cut impact. >> adami, aren't you excited every morning? >> look at me. >> 33% is like -- >> i't isnt 1/3? >> 33% is 1/3. >> it is and high-dividend strategies. sure, these are investments. but they're not what people really invest in. what people really invest in,

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♪ ♪ welcome back you're watching "squawk box" live from the nasdaq market site in times square. good morning and welcome back to "squawk box. what are you laughing -- what's wrong with that? >> wants to know how i got into m.i.t. when i didn't know 33% was 1/3. >> 1948, not a lot of people applied then so stands to reason. >> aqua man. >> i think that's kind of like -- that answers its own question, doesn't it that in all likelihood i probably -- i knew it was -- i kind of knew 33 1/3.

you know, doesn't a 5-year-old know 33% is 1/3? >> i don't have one. >> six years old so that just makes me wonder that -- >> are you smarter than a 5-year-old >> this person looks like an adult tweeting but how did he actually make it to adult hood without -- >> oh, you're reading a tweet. >> why don't you fill us in. >> how do you not fall off a ledge or something or get walked out -- i don't know. u.s. equity futures at this hour, let's take a look. it's blocked bitcoin, those equities up 227 s&p up 18. nasdaq -- oh, how did you get a trust fund baby? that's me. cincinnati yeah, trust fund bitcoin rallied from the 20% plunge last week hit a new high yesterday climbing 11 to 11,700. that's up more than 30%, which is, correct me if i'm wrong, just under 1/3 to thursday when it fell back -- >> that's right. >> am i right? >> you're right.

>> thanks. the rapid gains mean that cameron and tyler -- winklevoss. larry summers is on. >> social network. >> they're worth 1 billion now because -- >> we think. assuming they have -- >> they bought $11 million if they held it. >> if they bought it. >> bought it at $120 per coin. >> i think that may be a stretch they held on. >> they definitely held it >> really? >> these guys are full in, 100%. >> awesome for them. we'll have them on they'll probably come on if we ask them. >> probably. >> we should before your buddy does. >> look at the percentage gains, that's hilarious, 11,638%. >> unbelievable. >> you're on melissa's show, you're not on wapner's. >> feigning igs new orlea ining. you know i'm here at 5:00 p.m.

on melissa lee's show "fast money. >> wapner, we should invite him on >> we should get that. >> sure. sure good idea. let's issue the invitation. >> or get one of them on and keep taking different shots. >> pretending? >> fake news. >> genius. >> let's talk about what's been happening in washington. congress back in washington today voting to proceed to conference to hash out final tax bill with the senate joining us right now is nick johnson. he is the editor in chief at action i ow axios. nick, there is a lot to dig through. congress very busy this weekend. we still have to go to conference, still have to get both houses to vote on the new mushed together bill this has momentum at this point. hard to think of people voting yes now voting no. >> everyone on the hill and the administration, they think this is pretty much close to a done deal differences between the house bill and senate bill aren't insurmountab insurmountable

we haven't heard people say these are things they won't be able to agree with the house is moving forward. as you said, momentum is key here a lot of republicans say they have the momentum to get this done >> the lead story in the wall street journal today is despite these huge tax cuts, they say it's business interests that are going to be howling about this because they didn't get everything they wanted, particularly with that corporate alternative minimum tax being put-back in and the implications of that. what's likely to get lobbied out here, what's likely to get affected >> there won't be a lot of changes. where do you get the repeal out, amp corporations or for people there won't be any big changes or tweets added. >> we're saying big changes. i mean, we're saying no tweaks added to these things but for every lobbying group out there this is life or death on whether they're going to be able to get through based on a line or two that may or may not get put through, one in the house or the senate or vice versa. >> that's absolutely true. that was a lot of changes in the

senate all of these very final, very specific tweaks being made in the senate i'm sure there's a lot of lobbyists, this town is crawling with them, trying to get their one last line into the bill before the texas final and goes to the president those will be smaller changes than bigger things except one thing that was thrown out this weekend. president trump said he would be okay with the corporate tax going back -- >> what happened after it had already gone back to both chambers, they agreed on 20% thinking he wanted this, why did he tweet that? is there something else he wants put in this bill >> we don't know why he tweeted that he's trying to make another bill maybe. the senate doing a lot of work to hold the line at 20%. it doesn't seem like it's going to move again but, again, if there's any problem with the deficit in the house, that's where you can sort of move them a little bit. >> susan collins today, don't want to assume it. you still have to wrangle these people again, nick, don't you?

>> they have them all. they have collins, mccain. >> amazing. >> corker, we don't even need you. >> right >> i think people -- they voted for it once. i think they're going to probably vote for it again >> so mccain can't all of a sudden say, you know what, you changed this in the house, i was a yes, now i'm a no? you don't foresee something whacky >> he's john mccaccain, can he o whatever he wants. >> didn't you say that, adami? >> why would i repeat that it's already been said i have to try to come up with my own clever things. >> all right. >> the line you use on the hill is nothing is agreed to until everything is agreed to. they haven't gotten everything agreed to yet. >> that's a good one, too. i remember that one. >> let's talk about what's been going on with the fbi and russia investigation. lots and lots of sound and fury over the weekend where does it leave us on monday morning? >> well, the latest we have, mike allen, our good friends on axios reporting, john dowd is

saying the president can't be held liable for obstruction of justice which is a bold statement by the president's lawyer to make seems to be falling on what senator feinstein said trying to get president trump on obstruction of justice worth calling around to abunch of lawyers on that that's interesting constitutional and legal question which isn't exactly settled, i think on a lot of these presidential things, what the president's legal liability, it comes back to the house of representatives. >> it is for now but -- >> for now, that's true. >> everybody says -- i get tired of hearing that. it's the cover up, not the crime, blah, blah, blah. let's say there's no collusion >> right. >> i just don't know -- and with all of the rhetoric on -- you know, there are -- with trump supporters about a deep state and about how from day one, you know, maybe they were -- you know, obama even setting up a logan act. i'm reading all the stuff about

this coup that's been -- supposedly in conspiracy circles has been orchestrated from the beginning. if there was no collusion, do you think the obstruction of justice thing is going to -- you know, even though there wasn't a crime to start with theoretically, do you think that's going to pass muster for a full removal of a president? >> i think the answer to that is what mike wrote this morning when he said sounds smart. if the republicans are controlling the house, the answer is no if democrats are controlling the house, the answer is yes. >> oh, boy >> let me ask you one other thing, nick. >> yes >> this got me comey, i used to think that guy was -- and this goes back 10, 15, 20 years i knew him, i met him. i used to think he was beyond reproach tweeting that biblical stuff when it looks like something bad is happening, how justice is -- after what we know about the hillary stuff where he wrote the stuff beforehand -- >> you're going to talk about tweets over the weekend?

>> no. >> or the president's tweet. >> i'm talking about comey do you think it's normal for him to -- as a -- it just seems like he's really got an axe to grind in this whole -- personally. mad. mad that he got fired. >> i would love to leave my comments on everyone's twitter accounts, delete your account. too much. >> how about pareet after he saw brian ross's -- the thing that got him suspended. i think that's what he saw and he tweeted one word, bingo so he wants the same outcome we know where they stand at least. >> these guys are going to have books to sell soon and we're talking about it so they probably like it. >> that's probably part of the reason for the tweets going on behind it. nick, thank you for joining us this morning. >> absolutely. >> really good to see you. >> thanks. >> so unbelievable amos 5:24. >> yeah.

right. coming up, our newsmaker of the morning, besides guy adami, the ceos of aetna and cvs are here to talk about their $69 billion deal cnbc exclusive at the top of the hour then we're going to talk tax reform and health care with guest host, yes, two hours of langone, of the langster of the langononater and then at 8:00 representative kevin mccarthy will talk about reconciling the senate's tax bill with the one the house already passed stay tuned, you're watching "squawk box" on cnbc

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welcome back let's check out the equity futures more than triple digits. in fact, 200 indicated that's the highest we've seen since we've been here. up 233 on the dow which is a new high 38 on the nasdaq and s&p indicated up over 18 points this morning. so we're starting off where we finished last week >> picking -- >> except for that 350 point -- >> midday decline? >> yeah. who pays for that? >> that's what trump is asking right now. >> right >> i don't know but, you know,

people -- >> serious question. >> "fast money" trader you know about stops you get stopped out and then you don't have -- >> you don't have any say. >> no time to get back in. >> hard to have recourse i'm actually asking a serious can he. >> i know you are. >> i don't know. >> if the president tweets it out, does that give -- >> right. >> -- the -- i don't know. >> every day we wonder >> love that at the weekend box office getting away from all of this, "coco" took over the top spot. it earned more than $26 million in north america according to comscore the movie is a big hit in china. it racked up $75 million in ten days there. second place, "justice league" brought in $17 million in north america its global total to date is now $567 million when we come back, the squawk ceo call is in session.

tupperware brands boss rick goings is here to talk tax reform and consumer spending that is next. then our newsmakers of the morning or some of them will be joining us at the top of the hour cvs ceo larry rlmeo and aetna ceo mark bertoliniwill be here we'll be right back. i think that she's a very nice girl... you never got the brakes looked at? oh yeah. no. at cognizant, we're helping today's leading manufacturers

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♪ i don't know -- welcome back to "squawk box." ceo call is in session joining us talk holiday sales and tax reform, rick, ceo of tupperware brands thanks for joining us today. who doesn't have tupperware? you obviously had some people you're paying for some innovation i want to see what we're talking about off camera here. you can use the microwave to, like, grill a steak. let me see that. >> you talk penetration of microwave ovens around the world. it's amazing yet, most people use it for heating liquids. or re-heating things this converts microwave energy into thermal energy. it's very heavy. >> first thing i thought is -- >> it's shockingly heavy

>> a lot of time you can't put metal in microwave >> why can you put that in >> the rounded corners >> that's what we spend our money on research and development. >> if i put aluminum foul in, it will -- i don't get it >> the shaping of it >> so because it's metal, that's why it grills -- >> that's $250 too, beck yes, and if that sat on a shelf on a store, it would sit on a shelf yet, when we do financial conference and it's sitting in the back of the room, people steal them >> and you can -- >> we're thinking about stealing this one >> you can see it doesn't fit on top. it fits on what's in there >> there's two ways. it goes all the way down on the steak if you put it on one way, and you turn it the other way, and you could grill cheese sandwiches >> oh, my god. that is -- >> it's -- >> how long does it take -- >> we spend money on our tax department and on sarbanes oxley. >> listen to you

>> the tupperware dude >> deregulation and tax reform is going to help your company? >> i was just kidding with somebody earlier i said we spend so much on sarbanes oxley and on tax. on finance, audit, and tax department i said, oh, mynd go, that spells fat. if we could spend it on product innovation and marketing, we could do more things like this >> you just said, oh, politics is boring. when you hear tupperware -- >> it's unbelievable the ceo of tupperware, sarbanes oxley >> what is that other thing over there? >> oh, this converts -- this was conceived in france. there is metal inside it what happens is you fill the bottom with water. you set this inside. you put lobster or shrimp in there. you put produce up here. it has a metal shield. you set it for seven minutes,

and it's done. >> who would think about using microwaves who didn't think about microwaves >> i have to say when microwaves first came out back in the early 1980s, my mom took a microwave cooking kras to figure out how to cook a turkey in the microwave with this stupid thing that they would put into it. >> the old thermometer >> the thermometer thing was how they did it. we'll get that that was -- it kind of went by the wayside. it was a fad it lasted a year why is this different? >> plain sight you had to do the research of what is next with microwave, and everybody stayed with the old thing. the way it was that's why we spend our money on research and development >> so this one is $250 steamer? >> this is $150. >> how long have they been out there? how are they selling >> it came out this year, and this one came out two years ago. it really sells best in countries where people love to cook, like france. >> got it. got it

because -- or you also mentioned urban areas where you don't have a grill in your backyard >> now 52% of the world's population lives in urban areas. >> that's why sorkin could -- >> can you grill kale or tofu in that thing >> steamer >> or veggie burger. >> absolutely. absolutely yeah >> we have 3.2 million women who demonstrate this it so we don't have to spend our money on advertising. she shares it with a friend. >> why do we look at -- we'll look at those in a second, but why are we looking at those? >> we want to talk to you about because the financials of your company as well and growth prospects and all -- >> this is -- >> i'm fascinated by all these things you brought >> number one, if you travel through the rivers of indonesia is our number two country. if you get out -- >> indonesia >> if you get out into jakarta, you will look in the rivers there, and you will see what's floating in the rivers are these

plastic bottles. one used bottles we've created one of these just to defend the environment. i mean, this is -- we almost can't make enough of these >> it looks just like a bottle >> it's ain't single use you use it for ten years you just fill it up. >> but i already have things just like this what's different >> not this level of quality mostly what people have is they use -- the reason most of those people buy those it -- he saw them upstairs in the greenroom convenience. we come up with a way that, hey, our number one selling product in china is $1,000 water filtration system because you just can't go to the tap you really come together, where is the opportunity then you have a sales force where you can explain it >> are tupperware parties still happening? >> every 1.2 seconds >> so another -- >> but it's demonstration.

you know, i've had this -- >> what's that >> this -- if i took something like carrots or even better -- onions, put them in inside this and then i go like this, look at that spin. >> so you don't have to get your hands all -- >> chefs grab this from me and say that means i don't have to do this. >> you don't get your hands felg e smelling like onions >> did you just cook it or slice and dice it? >> sliced it >> the power of the demonstration. >> on that note. >> can you come back and we'll talk about your balance sheet and stuff? i mean, this is fascinating. >> that's good too this is how you separate yourself from amazon innovation and demonstration >> thank you >> thank you, rick, for being here thank you for being here with us for the hour >> can you do stuff like that? >> apparently not. >> when we come back, our

newsmakers join us in a cnbc exclusive interview. stay right here. auto tada!

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but look, we'll get through this together. and remember... we at the imaginary friends society always have your back! . a monday morning rally wall street cheers and tax reform progress in washington. breaking deal news cvs health is buying aetna for $69 billion. the ceos of both companies are right here right now to join us live in studio, and we'll talk to them in just a moment a special guest host this morning. legendary businessman as the second hour of "squawk box" begins right now

>> you couldn't afford a set like this i don't think. >> the cme increase and the -- i know that. all the money you're spending down here. i keep saying to my wife, you get the checks direct deposit >> we have coffee for you this morning. >> you still cashing your social security checks. three people whose names end in a vowel at the same time at the same time >> z ansantolli is over here to. >> keep going. we're getting it >> i'm joe along with becky quick, andrew ross sorkin is on assignment he is in a communist country he is in china, actually

>> he is -- that was a softball. he will join us live from there tomorrow guest host this morning ken langone, founder of invimed associates and co-founder of home depot you know a little bit about entrepreneurialship, the economy, starting things, building wealth, prosperity, paying taxes >> creating jobs >> creating jobs

>> with 233% in the dow, that's a little weird to see a 62% disapproval rating >> tell me about his approval rating before he got elected >> it was also 62% disapproval. somehow it happened. >> that's all that matters election day >> is this me still? wall street looking to start the week on a positive note. i think aetna and cvs and the superlative, both companies might be the top story today u.s. equity futures trading sharply higher up 230 points on the dow up 18 on the s&p up 34 on the nasdaq. the big driver today, optimism about tax reform

>> i wasn't kidding, but i was -- let's just move on. >> cvs health is buying aetna for $207 a share in cash and stock. a deal valued at $69 billion both ceos are here we'll talk to them in just a minute first, let's talk about the big rally. >> i still think 33% we say it so easily. in a year, i was pining for the days of the mid 1990s. >> you have to go back to the year to get a gain that big. >> yeah, but that was -- >> it's true i'm just saying. >> you have to mark it down 40%. >> the market hit new highs starting early 2013. it's a phenomenal performance.

it's dow-centric right now the big blue chips are some of the main participants here i think what the rally this morning is stelg you is a couple of things. one, there's still suspense going into the weekend that the senate was going to pass this bill, and, two, the character of this market has not changed much what that means is pullbacks very short, brief. the smoothest year in history. for now i think the odds are that that carries through for a while.

a tax package -- owners of capital and then whatever gets done with the benefits of it all of this stuff i think is a good thing the question is do we kind of get overfed on good news, and everyone gets piling on, and stretches the market too much to the up side? i don't think we're there yet. >> no. watching the futures this morning has been pretty impressive just building on last week's -- >> mike, thank you very much it's good to see you let's get back to today's top corporate story, and that is cvs health buying aetna. joining us right now is larry merlot he is the president and ceo of cvs health, and mike berlini is the ceo of aetna welcome to both of you we've had a business relationship going back to 2010. as mark and i continue to have discussions in terms of how can we do things more strategy

eenlicily, you know, it was clear as doctcvs health was mov to become more of a health care company and getting closer to payers, mark in a similar strategy in ermz it of getting closer to the customer it's really the perfect time to bring these two companies together to create a new health care platform that can be easier to use, less expensive for consumers, and really create a new front door to health care in our country. >> mark, you have talked about wanting to get closer to consumers. you're talking about a situation now where you have more than 9,700 retail stores and minute clinics too. how many minute clinics are out there? >> we have about 1,100 >> that's a way to reach your customer what do you plan to do with those? >> if you think about what the consumer thinks about health care, it's a single highest line item budget in the household budget today it's the most confusing system that anyone could use. think of an idea where we have 10,000 new front doors to the health care system where people can walk in, where they can ask for some help, get guidance

through the system we can make the insurance the back room of the operation and waive prior authorizations we can waive co-pays as people use the system that's more effective. we can reduce costs. it's simpler it's customized for the individual based on what they need and it's cheaper >> and all of these things will take you how long to implement how long before a customer has a different experience watching it walking into a cvs >> upon closing, there are things that we'll be able to do, you know, out of the gate, and at the same time we'll begin to pilot these concepts you know, we'll learn from them, and i would expect that within the next couple of years you'll see a dramatic change in terms of, you know, the store being not just about products, but also service offerings that can help people on their path to better health. it will really work as a compliment to the medical community, the physicians in terms of insuring that those zur consumers are following the care

plans. >> we've talked about a lot of reasons that this makes sense for cvs. we've talked about the pressure coming at the front end, the retail end from amazon the pressure at the back end, the pharmacy benefits managers just from people looking for ways to kind of cut costs and focus on that. is that what drove you to look for this too >> you know, becky, it's really about meeting this unmet need. you look at, you know, the health care economy is now, what, $3.5 trillion and continuing to grow at what everyone recognizes as an unsustainable pace you know, we think we have the opportunity here to begin to bend that cost curve, and at the same time help people achieve their best you look at chronic disease in this country today about half of all americans have at least one of those chronic diseases it's accounting for 80% of the health care costs. >> that stunned me when i heard those numbers. 80% of the cost. >> and there's billions of dollars every year on necessary and avoidable spending because people are not following those care plans we can make a dramatic

improvement in terms of, you know, getting people back on a path to better health. >> we worryabout -- >> i want to talk all these different things it's philosophically the individual mandate, and in a way it's a political football in the way that it's characterized. one thing to realize is that a lot of people that pay that penalty are people that can't afford premiums where they are right now. th they pay it. the other side is going to say -- we talked about it. we have larry summers coming on and he says thousands of people are going to die now from what's in this health care plan because they choose not to participate in obama care, i guess what's the answer to this? it's being demagogued on both sides. are you guys in favor of keeping the individual mandate, or is there another way to do this >> i think the individual mandate is constructive, and the financial structure of the exchanges don't work right now i would argue the individual

mandate is almost an immaterial argument we need a bipartisan solution. every marriage piece of social legislation that we've ever passed in this country has been bipartisan because every year they need to be tweaked. here we have a bill, the aca, that hasn't been touched for eight years. if we didn't do that with -- if we did that with medicare and didn't touch it for eight years, it would fall apart. >> what is the chance it's going to be tweaked instead of just -- >> they're going to have to. you got tbcontinuing resolutions on medicare. you have the budgeting they're all going to drive tweaking this. >> what does the solution look like >> the solution looks like -- what we have in the pool today is we have a lot of young people who don't join they're the people paying that because they can do math we know our arithmetic education in schools is working when someone says i have to i pa a premium every month, and i have to have a $6,000 deductible, and when i go to the doctor once a year i pay cash? should dow th i do this no if you put in front of them a

subsidy where you say you don't get this unless you join and when you get it, you can put it in a health reimbursement account or an hsa that will grow to $16,000 as you able, you have this pot of money there, and then you get younger people in. that will equalize the pool, and then you have a more financially stable organization. >> is that p the type of thing we're going to hear, says though i haven't heard that solution laid out >> you heard it from different pieces from different people if you look at the murray-headlimurray murray-alexandrer bill -- get something done bipartisan. >> let me ask both of you about whether you expect you'll be hearing any complaints from regulators on this front i know you have gone through it with similar situations, mark, with trying to do an insurance deal, but now you have the department of justice focussing on at&t and time warner focussing on vertical deals. does it concern you, and how would that potentially impact you? >> well, becky, we think this

transaction is highly complimenta complimentary. you think about this morning, and we've got a tremendous opportunity to create value, you know, for consumers and payers, and, you know, when we talk about payers, that does include the federal government we'll look forward to sitting down with the regulators, talking about, you know, how this comes to life in a meaningful way to see the benefits, the consumers, and the payers can see from this transaction. >> were you surprised with what the department of justice has laid out with at&t and time warner and i realize it's a different industry, but in i similar way looking at vertical mergers, places you wouldn't have seen regulators stepping in >> i think it's hard for us to talk about, you know, the transactions that may exist in other companies. you know, again, this vertical integration of two terrific companies, you know, the fact that we can demonstrate value in a meaningful way, you know, we think is the key to getting across the finish line >> mark, are you staying on to run aetna? i was confused when i was reading press releases people at management at aetna

would be running that as a separate unit. are you that person? >> i developed a great team. that team will take over we need to -- we have two companies. i don't know anything about retail larry doesn't know anything. doesn't know anything. just spent a lot of money on one. we need the expertise of both organizations to come together, and i will take a spot on the board of directors at cvs. >> but you won'ten running day to day operations. >> i will not be an operations leader >> i am going to be picking his brain, and i appreciate that mark is going to be joining our board, and i can certainly benefit from his expertise and his vision you know, as mark mentioned, we're going to continue to operate aetna as a separate business unit, and it will be led by members of mark's team. >> so what next? what's the next step for you all in terms of this deal? >> you know, the next step is, you know, executing and beginning the integration process, and, you know, says bringing the things that we're talking about to life so that we

can create this new health care platform and make it easier for customers to use and navigate. sfai at the same time reduce costs and help them achieve the best health possible. >> we want to pilot this, but my goal is to deliver a better company. >> you know there's something else health care over time is becoming more seamless for example, when i go get an example and i need a certain drug, right through our system into your store -- by the way, i boy all my drugs, my wife does too, at cvs. >> you're going to get some extra -- >> don't i look healthier? you got a store on 53rd and lex, and you got one in north palm beach. i watch, and i said this is pretty good because i get a call when my prescription is due for refill now, one of the problems you have with older people, guys

like me, is we forget. we don't want to forget to pick up a prescription. we sometimes forget to take the pill that day. all the things you are talking about i think one of the big pay-offs is going to be better health care and better oversight of people that need oversight for these drugs they take. look, it's going to happen it has to happen >> if you had to characterize it as a defensive move or an offensive move, is it putting together -- i know it's complimentary, but can you leverage what both companies have offensively to be the place that takes on amazon or takes on wal-mart or takes on whatever health care looks like in five years? is cvs-aetna going to be at the forefront? >> we do see this as a growth and expansion story for the reasons that we've been -- >> not defensive not because you see threats on all sides? >> not defensive

you know, we're -- we've talked about the unmet needs that we're looking to make. you know, you look at health care today, and, you know, when you talk about the traditional health care system and the opportunities where i'll describe it as -- they're missing the convenience, and that's the unmet need that we think we can create with this new front door >> all with cost pressures in the background too i look at the media landscape and what the internet and, you know, trying to figure out who is going to be ahead in ten years is daunting. i don't think it's that different with health care also because not only because of the internet, because, you know, health care inflation and technology everything -- >> the potential >> now we have sensors all over the place sending our data to when you didn't take your drug or it's not working, your glucose levels suddenly spike. it's going to be unbelievable. i don't know who i want. maybe cvs-aetna where.

>> you want a trusted relationship if you have a place to go, most people to find their health is a barrier to life they want to live, and the unmet need is it's so confusing, how do i figure this out if you have a place to go to figure that out and we build that relationship with you are is and we map it out and we make your appointments, we clear your prior authorizations, maybe we have claims. it's an easier journey that's a different model that meets a need that nobody else can have. looking over our shoulders at competitors saying what are they doing next is not a worthwhile effort it has to be where do we think we need to go? >> what do you do with employers like ours. comcast. used to be aetna now we're united health. if you are using one-half of your operation but not the other half, what happens >> it's okay that you matd a dea mistake earlier. >> i think there's a great opportunity that when you combine the two together, there's a synergy that can be created. you know, when you this i about

the information, the analytics capabilities of and combine tha with convenience and face-to-face interaks of cvs, that's, again, another way to bring to life everything that we've been talking about this morning. >> when you wake up and, oh, god, united health care or -- do you ever wake up and think these guys are going to eat our lunch? who do you worry about who is a real formidable competitor for you >> we have tremendous respect for all of our competitors mark said it best. when you talk about how do we focus on what we can do? how do we find that white sparks unmet need, and how does that become our it work for fill that void, and, know, the customer doesn't -- if we listen p to our customers carefully, we can hear their frustrations, and then it's our job to come back and how do we stall for those frustrations, and that's what --

>> how did -- >> so two years ago we were just about to do the huma deal, and larry and i were having dinner every time i do something to improve health, i lose revenue, and you make money you have a new revenue model >> i always imagine this relationship coming together whether or not we did huma even with huma it would have been even more powerful. now we're here i think, you know, larry and i start talking about it seriously probably a year after that we said how does this happen what would it take why would we do it

we shared data back and forth. you know, every 50 basis points we changed trend it's $480 million in underwriting >> larry, you were talking about moves like when cvs got rid of cigarettes or were those the type of moves that you were talking about? >> they were you know, if you go back, i think our journey probably goes back a decade with cvs and caremark coming together through that time, we've continued to add a customer facing health assets, and we recognize the complexities associated that went to the decision back in 2014 to eliminate the sale of tobacco products i industry has done a terrible job of bragging about just how much better human beings are because of the health care industry from discovery all the way through to what i said was reminding people to keep taking

their drugs, including in your formula and more and more drugs that have life that are more expense e. you take a step back, and it's $15,000 or $20,000 that this guy is going to live to be 90? how much is life worth that's precious. i tell this to all the guys in the form suit cal industry you have done a horrible job pointing out to the world, just how much better. look at life expectancy in america. eight years ago we were at 48? i'm 82 i'm not going to stop. now, there are people who would wish i stop, and there are people that god makes me stop, but that's beside -- the point is i think the industry collectively, all of you in it, have got to do a much better job of getting your message out there how much you do for mankind. >> 34th out of 34 in value among the oecb nations we're 11th when you add together health care and social spending. we're the only nation of the oec

nations that spends 142% on health care. we spend 62% everybody else is spending more, and we wonder why we have an opioid epidemic. we have this problem it's a loss of hope, and there's a malaise around the lack of health because our system isn't generating the kind of results we have before . >> what happens with -- 2020 is the date on the horizon. >> this announcement really has no bearing in terms of the capabilities that we have to bring to the anthem business we've already begun that -- >> are you going to stick with that >> joe, one of the things that's interesting about this combination is that while we're starting here to build up these capabilities, we want to make this broadly vaavailable across the industry i think that's one of the key elements associated with this.

it really begins to bend this health care cost curve that we've been talking about mark said it yesterday he said it very well you know, the ability to create something that customers want to come and use, you know, we think that is the important enabler in terms of being able to make this broadly available for all much our clients. >> what was cvs's tax rate last year >> about 39% >> 42. >> 42? >> yep >> u.s. companies don't pale a nominal tax rate in your case you're paying more. these guys need new accountants. >> we've been consistent in ermz it of, you know, the impact of meaningful, you know, comprehensive tax reform we'll have a tremendous impact in terms of our opportunity to invest >> get more money for the insurance companies. >> invest back -- >> use it wisely >> capital jobs it would certainly allow us to accelerate some of the investment that is we're talking

about here this morning. >> so has the 33% rise in the dow, i mean, it's nice to park stock to make the acquisition. a lot of times you vee mergers increase and then there's animal spirits and stock market activity does that help does that help get you where you are today that the business environment -- >> i think it is again, you know, i think this combination enables us to do a tremendous amount. >> i'm just trying to figure out. how much money are we talking about on the bottom line if you are paying, what did you say -- >> we pay -- cvs pays 1% of all corporate taxes in america how much comes right to the bottom line? >> that's the interesting thing. the first year there's a lot of capital jep rated. then you have minimum loss ratio and all the other things that you need to worry about the regulatored versus unregulated

those are things we need to work through. >> the important thing being that we want to use those capabilities to invest back into the business for growth. >> right gentlemen, i want to thank you both for joining us here today we really appreciate your time and how in depth you've been with us. thank you for being here >> thanks for having us. >> congratulations >> you never heard of langone medical center just wondering >> down the street >> yeah, it is >> you are doing okay. >> thanks. >> i mean it >> this is all one big effort. this is the tragedy of health care in america. >> i'm going to buy each one of those things that has the pills. >> why do you keep skrug it up >> i don't screw it up i open up -- >> how many?

>> i take 16 ray day now >> 16 pills? wow. >> your pill box must be -- >> i take a diuretic i take blood pressure. i take -- i take predaxa i take -- i could name them. >> you're not leaving any out. never mind >> no, i'm not ligue anything out. >> larry and mark, thank you both again appreciate your time our guest host today is ken langone. he will sound off on today's top stories when we come back. it's all yours. wow! record time. at cognizant, we're helping today's leading life sciences companies go beyond developing prescriptions to offering subscriptions with personalized, real-time advice for life-long, healthy living. honey? you almost done? nope. get ready, because we're helping leading companies see it- and see it through-with digital.

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>> thank you for having me >> thank you for coming. >> we're going to do a rapid fire on things can't ignore tax reform. can't ignore what's happening with the stock market based on that, and what's happening with gdp based on, you know, even with hurricanes it hit 33. there's a different feel in the country right now. >> the one thing we have to do with all the respect to great things coming out of tax law, we as a nation have got to begin to address our deficit and our debt got to do it i think get this tax law buy my problem with it is i listen to chuck schumer, and the end of the world is coming with this tax bill i'm only surmising my guess is the end of the world for the democratic party is if

this tax bill, if it passes it's going to unleashes economic force all to the good for a lot of people. my taxes are going to go up. i think that's wonderful most people i know like myself have no problem. we have got to figure a way out to close this income inequality gap. >> that's like saying -- we benefit from estate taxes, but you must be a florida resident you're not going to get killed >> i'm a new york resident >> you're going to get killed. >> i'm staying a new york respondent's exhibit >> you're going to get killed. >> no, i'm not where. >> how much do you write off in state taxes? must be millions of dollars? >> i i have alternative tax. i don't get the benefit of my -- >> the tax goes away for individuals. it stays for corporations. >> let me say this one way or

the other. nothing is going to change in my life if i pay more taxes >> i go the t it >> if you take a step back and say hold on, i did well by the system that i was blessed to be born in, and then anything we can do to enhance that system, i think most people i know -- i know stan rockefeller, he feels the exact same way i do paying more taxes no problem with it >> you got more money than him i think. >> who cares >> no. i'm just saying -- >> who cares >> i don't know why you bring him up where. >> because stan and i -- i have known this guy since he was a 25-year-old -- the point i'm making is one of the most successful investors in america, i look at all the people i know that have done well, and none of them -- i was with frank last week he could care less about paying more in taxes.

>> there's a certain amount every year that you have to spend because of entitlements. >> why not come back and talk about entitlements >> the reason that they weren't able to accomplish anything with health care this past year, very simple when you give something to somebody, it's hard to take it back it's almost impossible the only hope we have is to grow out of where we are reason i think we can we will. i think i'll feel better when we address the debt, when we address the deficit in a way that we're doing this over a period of time now, i happen to believe that we're going to need a very significant recession of some point. we get it done the stock market is going to take a big hit >> we're going to need a recession to address -- by addressing the debt and the deficit, it will send us into a recession. >> exactly anybody who thinks otherwise is

polyanna >> what type of issues do you think we should address those issues >> the people that address the stock market, the best protection, don't be in debt the worst partner as an investor for you is your bank they want their money back first. i would caution people that have enormous leverage be careful >> the u.s. has enormous leverage if rates go up, when we get the growth, that's going to be when you get -- it gets scare whery.i >> the world will get our house in order we have the best currency in the world. >> as an aside, we're going to go to break and come back. you are a ge board member. >> yes, i was. >> ge i just looked at it back below $18 a share. when were you a ge board member? >> i was a board member from 1999 to 2005 >> to 2005 >> i have -- >> could you have done anything to -- did you see this happening? what do you attribute it to?

why did you leave the board? >> because i was asked to leave the board. >> by who? >> by jeff >> by immelt >> why >> was a bad boy i used bad words in an interview with "fortune magazine." >> that's honestly it? >> same week it published he called me up and said, oh, this is terrible. >> because you used a curse word >> yeah. i use bad words. >> i know. we have you on all the time. >> i'm careful here. >> the board -- you were part of that board which a lot of people now think maybe was a little too controlled -- >> it would be self-serving for me to say if i was there this wouldn't have happened know this much when i was on the board, i always asked a lot of questions. i attended every board meeting, and i attended every committee meeting. there were things i saw that bothered me, but they were more cosmetic than they were -- the one deal i was there for and i asked questions about it, which they never even bring up

anymore. the -- >> the best deal >> is it well, then they ought to reveal how well it is look, the one thing i do know is i'm a great believer that if management comes in and proposes a deal, they give you the reasons why they want the deal, then a year or two or three years later you say, okay, tell me how that deal is relative to where we said. simple math. i understand -- i understand that people on that board now concede that they never did retrospectives on the deals they did. >> was it an independent board >> i have a theory on independence okay i don't think -- i think ge probably got the highest rates for governments of any that i can think of, right? tell that to the stock market that's lost -- we got great governance, but they lost two-thirds >> does it mean that -- who picked the lead director >> initially this is very

interesting you ask that question jeff came into the board to tell us that andy was going to be our lead director. >> he told you that. is that normal is that the way it's normally done >> no. that was my first pause. i didn't know anything about it. i didn't say anything. i thought it was rather unusual that this is going to be -- theb andy left a year early for what reason, i don't know then ralph did the same thing. ralph is going to be your leader >> again, immelt -- >> how is that lead directors usual chosen by the board >> this is where the line is drawn. >> right >> i don't think -- ralph is a wonderful man, and a good guy, and could do good work go back and look from the 16 years, here's some numbers in the 16 years ge bought $107 billion worth of stock ge industrial had a little more oeld over a billion dollars in debt when jack left.

it's got $85 billion in debt now. ge capital had 5% of its assets in real estate it's now at 12%. goodwill on the industrial balance sheet went from $12 billion to $85 billion now, in the -- you talk about that debt. they sell plastics for cash. they sell water for cash i mean, you -- what else did they sell? >> nbc universal >> they got cash from that exactly. they didn't get -- there's a good example i mean, look at the value that at&t is paying for if they can get the deal done. >> almost all the stock was about -- >> i'm going to guess the average buyback price was $25, $26, $28 therein i have no trouble with buy backs. home depot has cut its capitalization in half through

buybacks that was into a company where the results keep getting better and better and better and better >> right >> what i'm mystified by is this company said back in the spring it was going to earn $2 a share, and just like that it's down to $1.05. >> the trailing jet is a side show do you believe he didn't know about the trailing jet >> let me tell you what about that that's interesting >> well, let's take a break. is that all right? >> all right >> no. when you come back, you have other things we'll be here. >> coming up, tax reform by christmas? a republican senator shelley tlk. aooathe has lk t ouoo we'll be right back. double digits.olio droy it really scared him out of the markets. his advisor ran the numbers and showed that he wouldn't be able to retire until he was 68. the client realized, "i need to get back into the markets-

i need to get back on track with my plan." the financial advisor was able to work with this client. he's now on track to retire when he's 65. having someone coach you through it is really the value of a financial advisor. and high-dividend strategies. sure, these are investments. but they're not what people really invest in. what people really invest in, is what they hope to get out of life. but helping them get there takes a pure focus.

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wifiso if you can't live without it...t it. why aren't you using this guy? it makes your wifi awesomely fast. no... still nope. now we're talking! it gets you wifi here, here, and here. it even lets you take a time out. no! no! yes! yes, indeed. amazing speed, coverage and control. all with an xfi gateway. find your awesome, and change the way you wifi. >> the house is wack in session a day early following the passing of the tax reform bill shelley moore capito joins us. it's going to be this year >> i gave it an 85% chance of passing. >> what do you give it now >> 100 yes.

>> what -- >> the momentum is unstoppable >> what needs to be -- how is it going to be reconciled >> i think what happened was in the very last several days the senate bill moved more towards the house bill in some aspects, and i think that was in anticipation of a conference some of these things have been ironed out the house has said they will accept the removal of the obama tax penalty portion so that's a big hurdle there >> that helps. >> it helps a lot. so i think we've looked at this. we know how important it is to the economy. we see it's an anticipatory lift already, and i think the american people believe it's going to happen. >> it's hard to -- >> agree >> they're still trying, but it's hard for the other side to keep saying, well, the stock market going up doesn't really benefit main street. you know, for so many reasons there's a wealth effect, animal spirits, 401ks that people have.

that is sort of a barometer of how it's going to affect economic activity and growth in this country, but they won't admit that they're still saying this is -- i'm reading this is the worst bill in the history of the world. you read the rhetoric from the other side you know, people dying from this bill >> i know. for me that's just so disingenuous because it's so over the top it's unbelievable. if it was something that was so devastating to the economy, it's taken us 31 years to get to this point. i think in terms of what we're doing on the territorial and on the corporate tax side, to relate to a state like west virginia, over 50% of the work force works for companies that are going to be able to unleash their capital to raise wages,

create more jobs, buy more capital, and that will have a major affect >> senator, do you think that will take place immediately? i ask this because it's not a popular bill when you ask people right now. they think that korcorporationse getting a lot, and many individuals, people who itemize medical expenses right now, students who itemize or who are able to not pay interest on their student loans and write some of the things off, they're unhappy about it do you think the benefits, the economic benefits, will catch up before you have the midterm elections? >> i think they will, but i would like to say our medical expenses and student loan expenses the senate treated those differently. >> do you think that will be the way that -- >> i do. i do i this i the house has probably realized that that is something that is politically unfeasible, and it makes sense for working families you know, if you look again at a small state like mine, 83% of the people in my state don't even itemize they're getting a doubling of their standard deduction, a doubling of their child tax credit for folks to say that there's

going to be no benefit at that level i think is untrue, and i think -- i think it's going to go all the way through the economy. i'm very, very excited about it. no matter what they say, i'm all in i've been all in i'll continue to be that way >> not all of the senators have been all in. >> no. >> once they're in, are they in? i mean, it's not over until it's over we don't -- what was that other saying >> it's not -- none of it's proved until all of it's proved. >> murkowski is in >> mccain? >> mccain's complaint at least on health care was process he seems satisfied with the direction that we're going you're right we're not all in until we're all in i think that this -- the momentum here is unstoppable i think the opportunity to do something very big for the country is an enticing thing for a political animal such as i am and many of us are >> can you figure out why it was

20202020 through all the hard part, and then it gets done and then, okay, maybe 22 why broach that subject now for the bill >> you know the answer to that -- >> that's how you negotiate. >> it was done >> it addresses the issue of it benefitting kor inting corporat. i have a question away from taxes. >> okay. >> to me the biggest single crisis in america today is not health care, it's not taxes, it's not immigration. it's public education. why every when in the hell -- you want to close the income inequality gap educate kids put kids in a position where they can compete for these jobs. when are we going to have a lot of noise made about these kids that are being deprived from the opportunity to participate in this economy if it doesn't start in washington, and i think you got

to -- betsy devoss, you certainly have somebody who gets it and who wants to make change. nothing is said about this, and it gets worse every -- obama came in. i could have been the greatest president had he addressed education. the other thing we talk about. where are the jobs for tomorrow? you get a four-year degree in a college. we're really putting a lot more emphasis on career and technical. >> we should >> we should >> these kids that are struggling going to college, going in debt, they get out, okay did everything they told me to do, and now where is the job we're paying electricians and car pep ters we can't hire them $120,000, $130,000 a year.

why not make an effort to let people know it's okay to be a tradesman. it's okay to be a craftsman. the bigger issue to me is these poor kids that leave high school and they can't read and they can't write and they can't -- >> i think there are all kinds of issues there that need to be addressed, whether it's the system that's been in place for so long that you can't -- i know in new york you have problems with what are teachers doing if their subpar or not performing correctly? >> right >> can you get rid of them >> no. >> no. then that's a problem across the country. i also think teachers are under valued in a lot of ways. they're not paid enough. in our state they're not paid enough they're not given the resources that they need to have, and i i that's an area we could really help >> thank you >> yes, thank you. >> good to see where you. >> thanks. nice to meet you >> coming up, much more on the deal of the morning. cvs buying aetna for $69 million.

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>> still to come, we have more of today's top stories, including cvs buying aetna for $69 billion. plus, a big step forward for tax reform this weekend. house majority leader kevin mccarthy will join us with what needs to be done to get the bill to the president's desk.

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miga health care deal. aetna --

>> it's really the perfect time to bring these two companies together >> we can waive co-pays as people use the system in a way that's more effective. we can reduce costs. >> more from that exclusive interview straight ahead investors cheer tax reform stocks are sharply higher assist the bill moves to get finalized. we'll talk to house majority leader kevin mccarthy as the final hour of "squawk box" begins right now ♪ here i am baby ♪ signed, sealed, delivered ♪ i'm yours >> 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 not just the nasdaq market site, but the first floor of the nasdaq -- >> ground level. >> ground level. this is our new set that we're on have you been here you were here last week. weren't you?

>> i was >> every time you come in you are in awe >> it's just so wonderful. it's kind of like child birth. you forget how horrible the renovation was and now you just really enjoy the beauty. >> that's -- how do you like it? ken, did you see the front of set here >> i love it i love it. >> you do? >> i wish i owned a plexiglas manufacturing company. >> people used to complain about all of our screens now you don't see any of our skreensz >> i like these big letters you got here for old guys like me >> i'm joe kernan. that's me. becky quick is here. andrew is on assignment in china.

>> you are the ceo and founder of -- >> you think i say that and think don't show you okay you ready? there's your beauty shot ceo and founder of invamed associates co-founder of home depot, which has a $205 billion -- >> market. after. giving back to our investors $100 billion in dividends and buybacks >> that's, like, $300 billion. >> over $300 billion >> dow component that was founded and built if his likeness >> how old were you when -- >> 1970 -- we opened our first store? 1979 1978 we founded the company. i was 43 years old ernie was 49 arthur was about 36 or 37. three old men which tells you a whole lot. dream big and dream -- >> what you can do in your lifetime or the best thing 400,000 of the most wonderful people in the world put that apron on every

single day good job, good pay, happy, good benefits you talk about capitalism at work >> i heard don't let anyone tell you that companies create jobs didn't you hear that in the last election that was such a weird comment, wasn't it? >> that's earlier. during the president's last -- you guys didn't create them. hillary said don't let anyone tell you companies create jobs all those 400,000 employees, they pay taxes, and then we can build some government programs with the taxes they pay, right >> this is a scary thing to me

you got to deal did. >> we've been talking about north korea having been on your radar, like everybody. >> hey, look we gave this guy 25 years. both parties the bushes, clinton, and obama we gave them 25 years to get to where he is right now. now we're saying militarily we can't do anything about it, and we can't >> all right we will -- let's talk about that one and talk about the plane we're going to pauk about a lot of things. first, we want to check on the futures. almost 700 points last week, including that unbelievable sell-off we saw midday on friday when it was up about 50. went down 350. i saw the lows itself, like, oh, my god you know, and it was brian ross. it was brian ross full on that that was -- i mean, the difference between candidate trump and president-elect trump contacting the russians, it was unbelievable unbelievable >> he has admitted himself and says he deserves >> hold on you remember when obama leaned over to the russian guy and said, hey, once the election is

over, we request do things together do you remember that >> i do. i remember it well >> you saw the futures almost 700 last week another 250 today. that's almost, you know -- almost another 1 ,000 point milestone. the next one is 25,000 >> just over a week. right. just over a week let's get to today's top corporate stories. cvs health is going to be acquiring aetna for roughly $69 billion in cash and stock. we spoke to the ceos of both companies in the last hour about potential regulatory hurdles >> we think this transaction is highly complimentary you think about what we've been talking about this morning we've got a tremendous opportunity to create value, you know, for consumers and payers, and, you know, when we talk about payers, that does include the federal government we'll look forward to sitting down with the regulators and talking about, you know, how this comes to life in a meaningful way to, you know, see the benefits, the consumers, and payers can see from this transaction. >> let's bring in bertha combbs.

the reason we talked about regulatory issues is it seems like the regulatory landscape may have changed based on the department of justice challenge of a & t and time warner that's a vertical deal, vertical merger this is another vertical merger in areas where they're not completely there, but complimentary. >> they have in terms of one area where they overlap it's in medicare part d plans. that's easy to discard the question is whether now getting this integrated model is going to be too much much a threat to some of the other competent every competitors. most folks don't think so. you have united health that has a lot of these elements already. >> which is what at&t thought about comcast, nbc universal it's just a different department of justice we'll see. >> but when you look at this deal and when you listen to what they say about it, it's really where everyone wants health care

to go. more integrated coverage more coordination. getting more of the excess costs out of there >> we can waive prior authorizations we can waive co-pays people use the system in a way that's more effective. we can reduce costs. it's simpler

it's customized for the individual based on what they need it's cheaper >> it does leave some of the other players now scrambling because you're going to have these two bow heem at says you'll judge united health has surgical centers they also have thousands, tens of thousands of doctors -- 30,000 doctors that they work with in primary care now they are the two giants. where does that leave cigna that doesn't necessarily have that or have the scale or huma as well?

>> i apologize i didn't believe you. why should we, though, after this past year, right? did it really happen did i dream that it really is moving forward, isn't it >> it really happened, and it happened on a timeline we said it would that's why we decisively moved the house was not supposed to be in session today, but we called everybody back because we want to move to go to conference. there are differences in this bill, but they're not that great differences in this bill we can work and have this done this year. there's a lot of people that have a vested interest in it not working. obviously. there is a good reason to doubt for even people that were positive on it there's a good reason to doubt it given what we've seen recently. just never know. in fact, when it finally happened and only corker was lost in the senate, weren't you kind of surprised, like it's

hard to believe it actually worked >> yeah. i never doubted the house based upon what the house has been able to do this year the senate is difficult. they have a very small margin. they have a lot of different personalities over there i give a lot of credit to the leadership of the senate to all those senators i give a lot of credit to this president that actually worked very diligently to get these individuals together he has put a lot of time and effort in. we're not finished yet, but the architecture of both bills looks very similar there's some elements we've got to fix as we move forward. really why i always believed it would work because the bill helps move america, makes us competitive, helps us produce more of the small businesses

>> i just talked to a senator from west virginia whether are we going to address the biggest challenge we have as americans right now, which to me is public education? we've got to fix it. these poor kids that are going to public schools are being jipped, being cheated of a future we won't be able to offer these kids participations in a growing economy if we can't get them with a basic academic skills they need, and i think unless somebody takes leadership here and said we got to stop this, we got to fix it, nothing is going to happen. >> i agree the work force of tomorrow, we're living for the fourth industrial revolution you know, it's not that i'm worried about who my kids compete against maybe somebody from new york or someone else. i'm worried about our kids competing against india, china >> you are absolutely right. >> they're not best prepared for it it's not just in the elementary. it's also in the higher education too. you look what's happening with odd affect and other places.

>> if you watch the focus of what we've been working on here in the house, i think that will be our next step as we move forward. >> god bliss you >> you got to make sure you have that work force. >> let me run you through very quickly. let's play rapid fire and some of the issues that you're going to have to sort out in committee. first of all, the amt. at the last minute the senate bill went ahead and kept the amt on corporations. that's different from the house bill how does that work out in congress >> well, i think that has to be eliminated that would destroy.

>> i think we can work in a out. i would actually like to see the rates even go lower if possible from that top rate as well >> does the problem become -- >> i don't think anybody should be punished for being successful >> in both cases that you have just pointed to, you are talking about spending more money. isn't that the problem with the senate where they start worrying about deficits >> well, i would worry about deficits, but you're not going to get out of this problem until you grow the economy then you've got to look at the entitlement. i mean, mandatory spending in this country is 66% of the entire budget. when ronald reagan was president, it was just 25% that is what is on autopilot if you are able to grow the economy, what you see happening right now, it's easier to tackle the future problems and get rid of this deficit. >> norj interest deduction the senate goes ahead and keeps that cap at $1 million

the senate has it at $500,000. what's on top? >> especially being from california, knowing the prices of homes and others, i am one that would let that move a little higher where. >> in terms of the estate tax, it looks p more similar than it had before talking about increasing the amount the senate bill eventually sunsetting where they put those things what do you think that looks like again >> well, i think we'll find the common ground in there i don't think people should be continued tax after they die, but we'll find common ground to get this done. >> timeline is -- when do you think you actually see it signed by president trump later >> i think we can get this signed before the end of this year for sure. i would like to do it faster that's why we move decisively to call the house back today. take that vote to go to conference we can start the work. the senate will take that. the vote as well i think these differences are not that great we both wrote to the same number we both have some of the same elements, but as you read about

it, the things you asked me about the differences, you know we can find common ground. we're not that far away on both of those the number of rates, yeah, we'll get there, but the rates are very close when you look at amt, we know that punishes research and development and the future of this country i think we can find a way that we pay and eliminate that as well >> real quick. we got to go, but you worried about the house in 2018? it's weird, isn't it if you keep -- if the gdp keeps going at 3%, the market is up one-third in a year, it's -- is that with this tax reform? is that going to be enough to stem some of the losses, do you think, or does it always happen in that election, you know, the two years after an election? >> you know, they always talk about the first year of an election after the party in power winning the presidency that is not positive when i look at at the end of the day, if we don't worry about the election, if you put people before the politics, we actually get this economy moving again, greater opportunity, i think we'll have a pretty good

election there i think when the american public looks do they want to bring nancy pelosi back as speaker, i think -- >> you stay focused like that, and you are right. people vote with their wallet. >> don't worry about the election worry about the economy. >> absolutely. >> jobs, and the education of this country i think the election will turn out just fine. >> great leader mccarthy, thanks for coming on today. we'll see you again soon >> nice seeing you again >> thanks a lot. >> let's go to julia she has brand new on facebook. >> good morning to you facebook announcing a new stand-alone messaging app designed just for kids the new app called messenger kids is for those between the ages have 6 and 12 who are too young for facebook that starts at age 13. now, this new app allows parents to approve who the kids can message and video chat with. it lets parents control the app from their own facebook account. the free app will have no ads or in-app purchases, which means facebook won't be making any money off the service. it also won't automatically transfer kids to either its

regular messenger service or facebook when they turn 13 now, according to e marketer, 52% of facebook users are ages 25 to 34 this could be a good way for facebook to lock in the next generation of users before they get hooked on competing apps such as snapchat this also comes on the heels of youtube for moving over it 150,000 videos that exploited children and included offensive comments messenger kids is just the latest addition to facebook's family of apps, including instagram and what's app other attempts to create new apps such as moments and facebook home did fail to take off. becky, this one does seem to have very large potential user base back to you. >> julia, thank you very much. a lot still to come this morning on "squawk box." up next we'll have our guest host continue. former treasury secretary larry summers will joan us to weigh in on tax reform. among his chief concerns, the impact on health care coverage he will jo utoxpinins ela

stay tuned you are watching "squawk box" here on cnbc another day of work. why do you do it? it's not just a pay check, you actually like what you do. even love it. and today, you can do things you never could before. ♪ ♪ you're developing ai applications on the cloud. finding insights hidden in decades of medical documents. and securing millions of iot sensors. so get back to it. and do the best work of your life. ♪ ♪ and do the best work of your life. gglobal bonds, and high-dividend strategies. sure, these are investments. but they're not what people really invest in. what people really invest in, is what they hope to get out of life. but helping them get there takes a pure focus. because when you invest their money without distraction, hidden agenda or competing interests, something wonderful can happen.

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>> fongs news and fox broadcasting network, including sports are not expected to be sold in the transaction. up next, economists responding to the senate tax plan and the impact on growth steve liesman will take us through the numbers. that is next "squawk box" is coming right back most etfs only track a benchmark. flexshares etfs are built around the way investors think. with objectives like building capital for the future,

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good morning welcome back to "squawk box. we are live from the nasdaq market site in times square. i'm becky quick along with joe kernan andrew on assignment today a major health care deal cvs health buying aetna for $207 a share in cash and stock. that deal is valued at $69 billion. we spoke to both ceos earlier in the show and asked them what this deal means for the competition. >> we have tremendous respect for all of our competitors mark said it best. when you talk about, you know, how do we focus on what we can do, how do we find that white space that unmet need out there, and, you know, how does that become our work to fill that

void and, you know, the customer doesn't -- if we listen to our customers carefully, which we spent a tremendous amount of time doing, you know, we can hear their frustrations, and then it's our job to come back and how do we solve for those frustrations and that's what a lot of this is all about aetna up by 3.3% half a percentage point right now. >> he really is in china, but a lot of people writing in said he wasn't here last time. andrew was he the time before. he is out a lot when you are here >> obviously, he is ducking me i know that. >> is that -- i can see that >> he is in china -- >> i'm a little hurt, but that's all right. >> because you love him. sort of. you love everybody >> i love him, but i call him what he is a comedy >> . >> he is in communist china. where else would you go if you are a socialist, right >> let's ask one steve. >> yeah, let's >> we got a representative on the other side right now

>> the last time. >> i'm out buying the show >> with more -- actually, he is interviewing -- >> i'm thinking about fishing more >> good. >> i don't know. >> andrew has some big things going on with china. it wasn't -- >> by the way, china is unbelievable >> happening >> unbelievable. alibaba, tencent we're beating up on those companies in america facebook it's nuts. >> no, it's not. >> well, okay. >> let's get to -- hi, steve >> i've had a great weekend. >> the new tie >> i've had this tie for a bit

>> that's a better introduction. >> you're a senior economics reporter >> no, no, no. a couple of surveys. here's the deal, folks over the weekend the tax cut now in place economists have been putting pencil to paper or i guess in the modern world they put fingers to spreadsheets to gauge the impact of the tax cut and the result is they see modest results and there's a nice big debate of the overall effect here let me show you some of the results. nabe at 0.2% goldman sachs 0.3. rbq, just a second i want to ad lib because goldman sachs, they're more in the temporary range, but rkq, george sees that as a change to potential, and that means that sticks around for longer that's one of the big debates here

bring back some of the foreign cash with use here, and i think all economists agree it reduces inefficiencies i don't think you get out of economic school by believing that reducing taxes doesn't ultsly reduce inefficiencies in the economy. increasing the deficit $1 .5 trillion pro-cyclical at a time when the economy is growing and increasing the deficit as opposed to during a recession when we might need the stimulus. a tighter fed. i will tell you right now that the fed funds futures are on the move they're now pricing in at second rate hike in september 50% probability. concern about it raising inequality, and the skepticism on both the job and the wage

effect let me give you some of the commentaries that's out there. i think first we have john riding saying we estimate that half the estimated increase in gdp comes from higher employment maybe the other half to come from the capital stock that is increasing productivity at investment. then there's joe over in -- republicans have argued that lower corporate tax rates will stimulate the economy through a step-up in investment outlays. unfortunately, the advocates for -- there is no historical evidence to supports this thesis >> one thing i have and that's this issue of dislocation. even while the tax bill in some cases does the right thing in terms of, for example, ending a preference for debt over equity in the tax code. that's good. there's a time of disruption while the economy adjusts to this new regime. you have all these high yield companies that are leveraged to the hilt

the coo market some of the muni market. we have estate and local there could be a negative economic effect through the disruption that causes -- >> i think some concern. maybe making an argument for some of the more extreme measures phasing them in rather than going to a clip effect. >> like the state and local taxes. zbloog right >> they were talking about phasing that in over a number of years. this is one that gets immediately -- >> make no bones about it, once this is done, it will be done. we have to begin to address the deficit and the debt okay we've got to -- i don't know how we're going to get to the point where we will not be in recession. >> i heard you say that earlier. >> we're going to have one, and i think it's healthy over a long period of time we have to get interest rates up. got to get them up because look at how skbro what would you tell lawmakers to look at in washington just in terms of how to address the deficit after this how do we take care of that?

>> then you have to -- look, presumably if are you creating jobs and getting people where they've got an income, they can you go back and say they don't need food stamps or -- >> you are not going to -- it's 71% of the budget i think. the other 20 -- military spending needs to be increased we know that by vir tie of what we're learning about our readiness right now. we've got to -- i think when you address entitlements, that in and of itself could cause economic slowdown. >> if you have an issue of

entitlements and deficits, then maybe shouldn't -- you should keep in reserve some deficit capacity some kind of cyclical ability and then maybe you should think about -- here's the politics of what you are arguing. that in the couple years after cutting the corporate tax, you have to go back to the american public and say i need to cut your entitlements. that's what you just -- >> no. what i'm saying is they'll go down by virtue of the fact that people now have jobs or have incomes that they don't qualify for. >> there won't be anything congress does. it will just be -- >> i understand one thing. the most important thing about this tax cut, you got to figure a way to close the income inequality gap i should pay more in taxes i am going to pay more in taxes. i'm okay with that why? because nothing many my life is going to change as a result of if i may more taxes. that's the case for most people. most people that have done well. sure, we would rather have more money, but guess what, if we have to throw money on the table to have a better healthier economy, so be it.

>> it makes a lot of economic sense. the question is for the magnitude. >> we have to say good-bye, but i want you and all your friends to stop using the unemployment rate as a gauge of full economic activity and start using gdp again because to say we shouldn't be juicing the economy because we're at 4% when we've been growing at under 2% for eight years, we can always do better in terms of economic growth we have a unique opportunity where rates are really low historically >> the question is if you are putting in a bill that that creates more jobs -- >> people want better jobs people want wage increases

we don't grow at 1.9% here we grow at 3%, 4%. that's what wear capable of. when it happens and it's -- >> you can have some excuse that it wasn't, you know deregulation it wasn't tax reform it will come up with something, but that's what it is. that's where you get back to growing like american exceptionalism allows. exactly. thank you. >> all right >> what happens? >> you want a quick response on that >> no, we got to go. we got to go talk about. >> i don't know if joe wants a response the measure of potential is one that's determined by population, and whether or not the tax cut can change that, we will see >> steve, thank you. >> thank you for the opportunity to respond >> ken langone is our guest host

today. he is the ceo and founder of -- and the co-founder of home depot. he was also a board member at general electric earlier today we talked a little bit about your time at ge, when he left and when you saw we asked you about the plane that was flying and we didn't give you a chance. >> let me put something in perspective here i was at ge when i saw this culture that jack had created. wel welch. the passion was unbelievable when you were around ge people, you felt this energy you felt this can do mentality i'm saddened by what's hand at ge ge today is a shadow of itself in fact, i don't even know if it will ultimately be broken up into smaller pieces again. the airplane, it's a small point, and it really doesn't merit a lot of attention, but the board got -- this is what i'm intrigued by the board got whistle blowers notice that this was going on in

2014 according to the press, which doesn't mean it's right, the board issued an edict stop it. now, the board doesn't go to the aviation department. the board goes to the ceo and the ceo says got it, i'll implement this policy. we know that since 14 they've done it again, which means that if the ceo went to the aviation department and he kept doing it, and he said they didn't know it, you got anarchy. you got the aviation department saying the hell with what the chairman said, the hell with what the board said. i'm still going to have a plan to follow them around. that was going on as recently as this spring so we understand the sadness i feel 600 million market the highest market cap of any company in the world in 2000 today it's 150 billion

>> that's where a lot of the cash generation came from, says and they manage risk very well in the capital business. they did a very good job at it now, whether the market got ahead of them, who knows, but i know this. it's sad to see what's happened with general electric. that's my take on ge >> our next guest is former treasury secretary larry summers. he has been very outspoken on tax reform in fact, he is out with the new op ed. he saysy, the gop tax plan would

cause thousands to die he will join us after the break. squawk will be right back.

president trump just speaking about the stock market before departing on a trip to utah >> the stock market i think is going to have a very big day based on the massive tax cuts that we're very much in the process of getting approved, but based on the vote we had last

week the stock market has been reacting unbelievably well the only thing that hurts it is the fed kuv, and there's plenty of that. >> larry summers responding to the tax bill, and the impact that it could have on health care coverage. in a new op ed out overnight, it's called yes, the senate gop tax plan would cause thousands to die snoo there's clear evidence looking across different states and looking at when health insurance has been phased in and out. when people lose health insurance, they're less ling likely to get preventive care and they're more likely to defer health care they need and ultimately they're more likely to die

>> we have mark here today the ceo of aetna, and his point is that there needed to be a fix for health care and the problems that have come up over the last eight years. he says there needs to be a bipartisan fix because it's a one-sided bill much like the tax bill you have nobody who has touched it in eight years. he says there have been problems that have been cropping up all along, and he would like to see a fix. much more akin to something that you have seen in the murray bill that's been put forth for the bipartisan lamar alexander bill with patty murray. what do you think about that idea >> look, i think it will be great to start doing things in a bipartisan way

that's going to require not passing major pieces of legislation hours after the relevant staffs have had a chance to evaluate them. that's going to require holding hearin hearings that's going to require doing all sorts of things that doesn't look like the administration and the current congressional leadership want to do. i completely agree >> fermz of the right treatment of employers that need to be addressed, and it would be wonderful if we could address them in a bipartisan way when we have government by tweet, that's not going to happen >> ken langone, how are you today? >> good. how are you? >> i'm, to so to speak, on the trenches with health care with our medical center here. we merged a couple of years ago with lutheran hospital in

brooklyn, which is at an economically depressed area. the quality of care has gone up. we can see that by the statistics we see. let me address the issues of thousands dying. if one person dies as a result of this tax bill, shame on us as a society. look at life expectancy. year after year after year i was at a session up in harlem last week about healthy living the food we eat. this is -- these are poor kids in an economic depressed area where we're pushing about the quality of food, says what they eat, how they eat and so forth yes, are there going to be people that can say i didn't get the health care i needed because of tax law i'm sure that's the case generally speaking i think the health care industry has done a hell of a good job, including

all those wonderful folks in boston who make sure people who need care get the care, and i think frankly, this argument that people are going to die is a little bit more emotional than the issue calls for. >> ken, here's the thing you're right that there's a ton that's splendid in our health care system, but people have had a chance to look at the data, both democrats and republicans here's the amazing fact. their life expectancy is in decline. if you had a concern that we weren't doing enough for access, the pattern you see in the data is exactly what you would predict. yes, there are terrific pockets what you have done in the new

york area. there are things that have happened in boston that are terrific overall we are seeing a huge increase in the dispersion in life expectancy in those that are left behind what the research i cited in my article shows is that if you look at where the increases in mortality are, they are particularly in those kinds of conditions where missing out on preventative care would be especially important, where access to medical care would be especially important. so i agree with you that if anyone dies as a consequence of our changes in health care policy, that's a tragedy. >> absolutely. >> but i don't see how you can look at careful studies -- i mean the studies i quoted were done by a woman who served on president bush's chairman of the -- not chairman on president bush's council of economic

advisers so you look at the studies, you look at the pattern in terms of people with different incomes and i've got to say that i'm going to put more weight in that than i am on your instinct and stick with the conclusion that people will die as a consequence of this bill. >> larry, your instincts about the stock market a year ago was that it was a sugar high, we're only up about 5% at that time. now we're up a full third, 33% on the dow so is it still a sugar high or what are you attributed it to? do you think it's going to go down 33% when you shrink it's been snuckered >> i can't predict what's going to happen to thestock market o i can't predict what's going to happen to the economy. i can say this, we always advise both president clinton and president obama, that -- and there's political staffs, that it was a big mistake to brag on

the stock market because as bob rubin used to say, markets go up and markets go down and when markets -- if you take credit when markets go up -- >> but what happened >> you take the blame when markets go down. >> but you've absolutely did not see a 33 prosecuti% rise in the market was coming. what did you miss about a market >> what did i miss i missed a ton of developments that happened in corporate sector and i missed what happened globally. the interesting thing is that if it was all an american thing, you'd expect that the american stock market would have outperformed foreign stock markets. but the fact is the american stock market is well below the afr average of global markets and that suggests it's a global factor, not something about american policy. >> larry, sorry, but it's more than my instincts, in brooklyn we've got lutheran hospital, now part of nyu, it was hard work

and it was changing management and it was infusing technology the people have much better quality health care and all getting it. >> ken, you've done great things. >> the team has done great -- >> including at that hospital and your leadership catal dzized all of that -- >> don grosman, he's the guy who did it. >> at the same time, you have to look at the data on what the patterns are all across the country. i don't see how you can believe that if 10 million, 13 million, whatever exactly the number is of people who are going to lose health insurance, that that's not going to have health consequences, even with great efforts like the ones you're describing. >> okay. >> we'll leave it there. thank you. >> great to see you. >> thank you, good to be with you. >> good being thwi you hope to see you soon. >> jim cramer will join us licking his wounds a little

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discover how we can help find your unlock. ♪ good monday morning, welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber if that weren't enough, the biggest m and a deal in a year as cvs buy