welcome back to "squawk on the street." consumer discretionary stocks in close focus. macy's, goodyear, marriott, as well, a lot of movement in that consumer discretionary space that does it for "squawk on the street." back downtown for the stock exchange and start of "squawk alley. back over to you >> thanks, dom good morning, it's 10:00 a.m. at the cme headquarters in chicago, 11:00 a.m. here on wall street, and "squawk alley" is live

good morning, welcome to "squawk alley. with me here at post 9, kayla tausche back again >> all three major averages hitting record highs the dow at one point within 150 points of 25,000 it's backed away from that a bit, but we're still keeping an eye on it. for more, philip swagle and jim paulson, chief investment strategist welcome to both of you jim, we keep hearing simultaneously that the market is rising on tax reform optimism and also that tax reform is priced in. which is it? >> well, it's hard to argue that it's priced in when it keeps going up every day that's for sure.

i don't know what has not been vetted by the market as far as this tax policy is concerned the news has been out there for some time. people got a very good idea exactly what it's going to be and already have adjusted their earnings estimates and so forth, so i sort of lean in the camp, too, that even though they'll probably pass it this week, most of that is included in the market here, but it's hard to get in front of a one-way freight train north here, but i think this looks more like buying the rumor and sell ultimately on the news >> so, philip, what do you think tax reform itself does for the economic prospects of the country and what it might mean for legislation going forward? there are some people trying to connect the dots to either say maybe it will have the added benefit of having profits recorded in the u.s., trade deficits will go down, we won't have trade wars. there could be some ancillary

benefits we're not taking into account here how do you see that? >> i agree with that two things are missing still so far. one is that many people just don't expect to get a tax cut. there's been a, you know, sort of a narrative that this is a tax cut at the top and the dollars certainly are at the top, but most american families are going to get a tax cut and a pretty big positive impact next year and 2019 on gdp, so i think that still hasn't affected people's expectations positively, and it will. and the point you mention on the trade deficit is really interesting. probably going to be accounting changes because of the base erosion provisions, the antiprofit shifting provisions that will lead our trade deficit recorded to be lower and could take the steam out of the protectionist measures from the president. >> jim, if people aren't pricing in, you know, the provisions of the tax bill that most of which

we've known for quite a while, are we really pricing in some of the follow-on impacts in places like california, where so much of tech is based and people with high salaries, high taxes, perhaps, on real estate are concerned about how this is going to affect them and perhaps the companies? do we have to wait and see how that plays out >> i think there will be some wait and see, john, but i also think that, you know, we've had a lot of time to think through some of these issues and i think the market by and large is made their decision on a lot of that and put it into the pricing of the market. this thing right now, earnings are going to be boosted by the tax cut. no doubt but right now on $135 forward one-year earnings we're selling north of 20 times. that's an awful big multiple on forward earnings, so even if earnings do really well and go up a lot, i think a lot of

that's priced into the market. certainly tech stocks in general has been vetted, i think, for most of what is likely to occur. and i think the other thing this is doing, it's drawing so much attention to this week and this passage of a bill and this tax policy, that it's probably not giving enough attention to if the tax bill is successful in boosting earnings in the economy, what does it do in a fully employed economy sitting at .3 away from a 50-year low in the unemployment rate? what's it do to the need to reset interest rates from a multiple that's where the attention might turn as the calendar turns in the next year. >> certainly some questions as to whether this is the exact economic environment that makes the most sense for some kind of corporate driven stimulus, but i wonder your thoughts how it's going to affect, if at all, corporate incentives and investment over the long term. some of the biggest beneficiaries already have, you know, plenty of capital to do

with whatever they'd like, so how do you think this filters into longer term economic growth expectations >> there's a pretty big incentive for investment over the next five years with the corporate rate cut and expensing, and the corporate cut is permanent, but the expensing is not and to me that's part of the uncertainty and the uncertainty on the personal side inevitably affects businesses for this to have the maximum long-term benefit, there has to be more certainty in the tax code and that's, obviously, a key risk with the bill >> well, the tax foundation is saying it's going to be 1.7% to gdp. we'll see how that pans out. philip, jim, our thanks to both of you >> thank you >> thanks. and we have new data from cnbc's exclusive all america economic survey offering more proof that stock market optimism is alive and well. let's bring in cnbc senior economics reporter steve liesman. steve? >> john, thanks very much.

americans are kidding to stocks. take a look at the rise in optimism here. we are for the first time in terms of those saying this is a good time to invest, at 50%. in the history of the survey we have never been at 50% you can see this change, the percentage of americans saying it's a good time to invest happening around december 2016, very much tied to the election bad time to invest down to 29% let's take a look at their attitudes by how much they have in stocks. of those who have no investments, 800 americans polled, by the way across the country, 31% say it's a good time to invest, but as you move up and have more and more of the portfolio, the more optimistic you are with 61% of investments under 50,000 saying it's a good time and 71,000 with more than 50,000 and the biggest gains compared to say last year are in the middle area right here those with less than 50,000 in stocks let's break it down by party and see the political affect on the

stock market here. one more thing here, which is we're at a record ownership there of 53% now we're going to break it down by party dems, not much changed compared to before the election, but independents have become more positive and republicans compared to before the election much more positive on the outlook for stocks and one more way i want to remind you, all of this economic optimism we've registered, along with stock optimism, it's helping a bit president trump's approval rating. overall his negatives are down a bit, positives up four points and the views on the president and the economy are also stronger he was 43%, 41% in september, now in terms of approval on the economy. john, all this is online, cnbc.com, you can read in detail about the poll >> interesting stuff, steve, especially when it comes to sentiment. how does that tend to affect the way that investors interact with the market i mean, if they are optimistic

about it being a good time to invest in stocks but turns out not to be, is there any data whether that leads to more frantic selling or is it completely unrelated >> you know, i think your question is interesting because you ask about the downside we can't find a whole lot of correlation between optimism about the stock market and in terms of the upside. i think you're right, though, to point to the downside that maybe you have people who don't have such strong hands, that are in the market without as much conviction, that it could hurt a bit on the downside, but it does help answer this question, especially the one, john, about stock ownership, about whether average americans are involved in this rally. they really sat out the obama era one, seem to be much more involved and interested in the rally under president trump. >> well, this is one case where better late than never seems to be working thanks so much now we want to get to julia boorstin with breaking news on

disney julia? >> that's right. john skipper resigning as espn's president. george boddenhiemer is taking over as acting chairman of espn. he has been president from 1998 to 2011 and is executive chairman until may 2014. this was going to happen as the company works to find a replacement for skipper for the next 90 days i think it's worth noting here that skipper said he has struggled with many years with substance addiction and decided the most important thing to do is take care of my problem, this in a statement that's been posted here. skipper saying i've disclosed that decision to the company we mutually agreed it was appropriate i resign he said i come to this public disclosure with embarrassment, trepidation, and a feeling of letting others i care about down, saying as i deal with this issue i ask for appropriate privacy, saying to my colleagues at espn, it has been a privilege. so disney now looking for a

replacement for espn as they have an acting chairman taking over for that role of course, espn has been struggling with the declines that the whole industry has been facing in terms of paid tv subscribers going down but espn is really a major engine for disney. disney's working to launch a direct to consumer espn service in the first half of next year that's going to be including content that's not on the core tv espn as espn and disney tries to figure out how to go more directly to consumer, but a huge revelation here of john skipper resigning amid years of struggling with substance addiction. back over to you >> all right, thanks so much, julia. worth noting skipper has overseen multiple restructurings of this company. several cost-cutting initiatives, but even so has been at the company for 20 years. could be described as a key man at espn. knows every single nook and

cranny of that company we'll be learning more about the man taking over for him in light of a permanent successor this is a bomb shell >> it's big. certainly, in light of the fact that we have the acquisition of the fox assets, which was in a sense going to the espn opportunity, as well as the kind of streaming of sports possibility, so i think that really if anything underscores the fact this is really about his own personal issues as opposed to some sort of strategic thing somehow the company nudging him aside. >> i guess the one thing that seems strange here to me, unless i'm mistaken, julia, are you still with us? >> yes, i'm still here >> didn't john skipper just get a contract extension a few weeks ago? >> i think that there was reports that he was going to get a contract extension, but his contract had not actually come up yet, so i have to go back and double check on that, but i believe this was a surprise in that he admitted to the

substance addiction issue and then resigned immediately as of today. there were reports out there that he would be renewing and his contract was up soon, but disney did not comment on that but certainly an interesting revelation here. i do think it's worth noting because espn has been such a challenge for disney, some critics said maybe they should have jumped on the direct to consumer model a bit sooner and, of course, they have this app launching this spring, but some people said maybe it was time for skipper to move on anyways and to bring in a younger management team. it will be interesting how this pans out and who they replace him with >> indeed. thanks for the initial details, julia. still ahead, bitcoin getting a bigger stage as the cme launches futures joined by tim draper, billionaire venture capitalist who predicted cryptocurrency would hit 10 million this year, and it did but he predicted that when it

was trading at just $400 espionage, hacking, bribery, uber accused of all that and more in a bomb shell 37-page letter with accounts from a former employee. details coming up. and what the departure of john skipper means for the fox disney deal. that's all when "squawk alley" returns. well, it's earnings season once again. >>yeah. lot of tech companies are reporting today. and, how's it looking? >>i don't know. there's so many opinions out there, it's hard to make sense of it all. well, victor, do you have something for him? >>check this out. td ameritrade aggregates thousands of earnings estimates into a single data point. that way you can keep your eyes on the big picture. >>huh. feel better? >>much better. yeah, me too. wow, you really did a number on this thing. >>sorry about that. that's alright. i got a box of 'em. thousands of opinions. one estimate. the earnings tool from td ameritrade. feel that? that's the beat of global markets, the rhythm of the world. but to us,

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it is a busy morning we've also got some breaking news on a train derailment in washington state sue herera, what do we know? >> john, here's what we know at this point apparently, an amtrak train has derailed right about at olympia, washington, which is, of course, south of seattle, washington it happened at about 7:45 a.m. local time this morning. that train is hanging over i-5 we do not know whether there were passengers onboard the train at the time. however, that is the morning rush hour in washington, and most parts of the west coast, in fact so amtrak is confirming that they know of this situation. they are investigating it has derailed near olympia, washington, which is south of seattle. it is hanging over i-5, but no word on injuries no word on the number of passengers amtrak says that it is investigating at this point. but those are some pretty dramatic pictures. the traffic is backed up for

miles, they say, at this point that's according to the local department of transportation so we're monitoring the situation, which is, obviously, fluid and ongoing. amtrak says they are aware of it, they are investigating, and as soon as we get any word as to whether there were passengers on the train or whether there are any injuries, we'll be right back to you and get you that information. john, i'm going to acceptsend ik to you >> yes, harrowing pictures we're going to be concerned about whether there's anybody onboard that train and whether there need to be any operations in that regard keep us updated. >> they are treating it as a mass causality incident, according to a reporter who was on the ground for the cbs affiliate out of seattle however, amtrak has not confirmed that they have not said anything about injuries at this point, but i think everyone is being very cautious, given -- take a look at that picture it is pretty dramatic. so we'll be back to you when we hear anything more >> absolutely. sue herera, thanks

and breaking corporate news this hour, as espn president john skipper has stepped down, as we had just mentioned for more on what that means for the disney/fox deal and more, let's get to kara swisher, executive editor at recode carr rarks good morning. >> good morning, how are you doing? >> doing well, so is disney overall. huge weekend for them with the last jedi, second biggest opening to the one before the last jedi, and they are wanting to do this big acquisition is this the galactic empire or the first order, what have you are they potentially too powerful could they push tech into a corner >> you know, i doubt it. i think what's going to happen is there's going to be several, instead of six or seven big studios it's going to be an amalgam going forward. so what needs to happen for a company like disney is they've

got to sort of strengthen up, because they are fighting some really enormous companies like amazon and google and others, who, obviously, have been dominating the distribution part of the network and it should be an interesting fight over the years, but they certainly need as much content as possible to do so i don't know if they are too big or not that will be up to the government to decide >> kara, we're now focusing specifically on one division of disney,which is espn with this news out moments ago that john skipper is going to resign oftentimes we tell you about breaking news that's just hit the tape and you are not surprised. you see it coming from a mile away does this surprise you >> oh, yeah. i'm surprised. we were just actually talking to them -- he's been to a number of our code events talking. he's a fascinating and incredibly strategic executive you know, espn has had a lot of trouble recently on lots of various sundry issues, but he's

always been a very important executive for disney, so it's kind of interesting to see what's happening here. obviously, seems like it's personal i don't know the rest of it. we'll, obviously, be reporting on what's going on, but, you know, could be like what john said earlier, you know, or julia did, time to bring in new blood. espn certainly has to be rethought, given all the declines and the impact on disney, which has been going on for a while now. so we'll just have to see. i don't really know a lot except this statement that he had some substance abuse issues >> yeah, i mean, obviously, it's hard to necessarily get a fix on whether this is, in fact, purely a very quick breaking person but do you actually think espn -- it was going to be rethought no matter what you have a merger that's going to impact that business on one level, but on one hand it seems almost as if the division had kind of weathered a lot of the tougher times, done a lot of the cost cutting and i'm wondering if it's at a point disney thinks

it's set up for the future >> i don't know. sports is so fast changing and so critical to the financials of that company, and iger was dealing with it quite a bit. this merger will take attention off that, at the same time who's going to be running what part of it if it goes through, so that would have been an interesting thing anyway because of the combination of all these assets. and so maybe since it was announced, skipper thought this was the time i don't know, so i can't say what happened. but i think it's probably one of those moments where if you have this kind of problem, you deal with it, i guess, instead of signing on for the next, obviously, enormous task >> what's your take on the overall strategic importance of espn to disney the stock was moving on concerns about espn in previous quarters, but now we see that the movie, the studio juggernaut, is moving

on unabated. is espn still key to the profitability picture of this company going forward? >> well, i think so. i think they all are sports are very important to any media company, owning pieces of them i think the good thing that disney has, they have a lot of different assets, so they can put focus on star wars, which has been a really enduring franchise for them this has been, what, i was a kid when star wars came out. this is an astonishing franchise. and, you know, i think people will focus on that for now, especially in this movie going season and possibly the combination of all the super hero elements they now have, but i think espn, of course, you want to have as many pieces of the puzzle when you're moving into the digital age moved into the digital age, but having this available is important. i think they definitely cleaned it up, but used to be, if you remember, their biggest jewel and then it became a problem we'll see where it goes going forward, but it's still

important. i don't know why it wouldn't be. >> speaking of clean-up jobs, another scandal at uber surfacing over the weekend it's been revealed a former uber employee has accused the ride-sharing giant of espionage, hacking, and bribery this all surfaced in a letter, which is evidenced in the waymo/uber lawsuit under way kara, does this follow in the category of happened before, so it will all be dealt with, or at a certain point does the level of at least accused wrong doing at this company sink in even further? >> you know, i think dara probably opens the drawer every monday and finds another dead body that's what it feels like here they've definitely got to deal with this. these are allegations as reporters we've all heard about this unit. they let go of joe sullivan, who was running the unit, all kinds of problems there. i was at a dinner just the other night with a top lyft executive and he said, do you think uber's been following me?

you know, i think everyone -- it was sort of an open secret there were all kinds of high jinks in this unit, i think it was called competitive intelligence, some benign name for sneaky, dirty tricks, i think. but i think that it's another problem, and he's got to clean it up. you know, you just don't know where it is. again, these are allegations it's in a lawsuit, but not something that everyone hasn't heard about for a long time. it's a question of whether -- what to do about it, how to fix it, you know i was -- i was talking to some executives at the christmas party, had a christmas party for the press, and they were talking about all the legal problems and feeling very buffeted by the revelations of a week before there were other revelations, and my only thought was you have to fire everybody involved and replace them, because that's the problem, i think >> that would leave quite a hole, kara >> yeah, i know. >> up until this point, most of the allegations have been civil,

that uber was a ruthless competitor, broke things along the way, but if these allegations are true, they'd be criminal does that now start an entirely new chapter for uber >> if they are proven. obviously, there's been some government investigations going on that we've read about if this is dirty tricks that crossed a line, absolutely it's happened before in hollywood, it's happened all kinds of places. if you remember a couple years ago there was a whole issue around the way people were investigating other people i think, you know, this again is a letter from a former employee, so you've got to pay attention to it. at the same time it's the middle of a lawsuit, but i wouldn't be -- i can't imagine that authorities wouldn't be looking into this. that's another, you know, dara's got to focus on getting the company going, moving it towards this investment, going public eventually, and running the actual business. and these are just more problems that attach themselves to uber that is a part of the cleanup. it's like a toxic waste dump in

a lot of ways. >> you wonder how it all affects that potential ipo process, certainly. kara, thanks for joining us. always great to have you >> no problem. when we come back, democrats are calling for hearings on disney and fox's merger. we'll discuss that and news the president of espn stepped down we'll discuss that with maggie wild wilderotter. first, shares of twitter up 8% after jpmorgan upgraded the stock, saying it's gotten better reptn onadrterceioamg veiss. "squawk alley" back after this

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fidelity wealth management. good morning, everyone, i'm sue herera here's your cnbc news update at this hour. we are monitoring breaking news near olympia, washington, where an amtrak passenger train has derailed that's a look at an early picture. you can see that car is hanging off the highway overpass we do know that there are,

according to the local affiliate, there are people on that train we have no word yet as to causalities, however, it is being treated by local authorities as a mass causality incident we'll keep you posted on that one. details emerging in connection with the security incident out of the uk police reporting u.s. service members fired shots before a man was detained for trying to ram his car into the milden hall base the man was detained and the only person injured. it is not being treated as terrorism right now, but this particular air force base was scouted in 2015 by an islamic extremist. russia's president vladimir putin thanking president trump for a cia tape which helped foil a series of bombings in st. petersburg the tip comes as russia-u.s. ties plunge to their lowest levels since the cold war. and the average price for unleaded fuel dropping by three cents to $2.51 a gallon over the

past two weeks the lundberg survey reporting the highest price in san francisco where it costs an a h average of $3.22 a gallon. back downtown to "squawk alley" and we'll keep you posted on the developing story outside of olympia, washington back to you. >> please do thank you very much. back over to dom chu at hq with the european close. >> tax reform optimistic views fuelling the rally here in the u.s. are also being felt across the atlantic up sharply this week especially the german dax, which has rebounded from its december lows it erased all of its november losses sharp move there higher. gainers in germany, deutsche bank, commerce bank, volkswagon, bmw, siemens, m & a also in the spotlight today.

thales acquiring gemalto for $5.6 billion in cash this comes just days after gemalto rejected a smaller bid vonovia agreeing to acquire buwog in a debt-financed all-cash deal. and in the uk, prime minister theresa may briefed parliament, insisting her government is well on its way to delivering what she calls a, quote, smooth and orderly brexit this after eu leaders gave a green light to moving brexit talks to a second phase, but the prime minister also called on uk lawmakers to stop the debate on leaving the eu from ending in threats or intimidation. the pound is rising against the dollar today on that particular trade, 1.33. back over to you >> all right, good rundown, thanks, dom. when we come back, the billionaire venture capitalist who predicted bitcoin's unprecedented rally. he'll join us.

what tim draper has to say about joe cryptocurrency trading on mar exchanges like the cme and where it goes from here. we'll be right back.

my name is cynthia haynes and i am a senior public safety specialist for pg&e. my job is to help educate our first responders on how to deal with natural gas and electric emergencies. everyday when we go to work we want everyone to work safely and come home safely. i live right here in auburn, i absolutely love this community. once i moved here i didn't want to live anywhere else. i love that people in this community are willing to come together to make a difference for other people's lives. together, we're building a better california. venture capitalist tim draper has been betting on bitcoin for years. in 2014 he predicted the price of bitcoin would hit 10,000 by 2015 gone way beyond that already take a look at bitcoin right now on the day of its cme debut, just under $19,000

that's the cash price, so to speak, not the futures price we're showing on the screen. tim draper joins us now to talk more about this market tim, thanks for being here with us i guess we have to say great call a few years ago on bitcoin, but does it now mean it's almost 90% overvalued >> no. i think it's valued according to the demand, and there is great demand, because this is a new currency that is global, and there are no other real global currencies, and this is -- it's a great opportunity for us as a society to watch as geographic borders fall and we become one big global society, and i actually think that bit coyne can lead the way and that technology, the blockchain technology, has the capability of transforming real estate, insurance, banking, venture capital, governance,

throughout the world this is actually a major opportunity for us as a people i think we'll be able to accelerate society at a much faster clip now. >> tim, characterizing it, though, as a currency, some people have argued that the faster the price goes up, the more it starts to look like a speculative asset. you have newcomers who don't really want to transact in bitcoin, they want to get along for the ride, it becomes less useful in the short term as a currency, so how important is it that it has real world uses relatively soon, beyond facilitating the growth of the blockchain >> you said it yourself, that's short-term thinking. long term, this is a currency. there's no question about it and it will be used by people all over the world, and now there are 20 or 30 million bitcoin wallets. i suspect that we'll be in the billions in not too long a time, and as that happens, there will

be more and more uses for bitcoin, there will be more people that accept it. fortunately, we accepted it at draper university. we had two students who paid in bitcoin about three years ago. and that's been able to fund the continued growth of draper university >> turned into a very expensive education for them, though >> yeah, well -- at the time it was about the fair price, but they were very kind about it >> so, tim, i'm wondering. this would be something on the order of a google or amazon type earn out for you if you put the kind of money into bitcoin when you made that call that you'd put into a company like that if it came into your office, so did you put that kind of money behind bitcoin when you made that call? and are other people in silicon valley of means putting that kind of money into bitcoin specifically now

>> well, i can't speak for all these other people i know that this is a major opportunity for a new currency that the world can use i did, i bought the silk road auction, the first silk road auction, and so i did bet on my thinking and it was just freaky that i hit the number right on the head it hit 10,000 about a month ahead, but, you know, that was back when bitcoin was sliding. i think i made the prediction when it was about 400, headed to about 200. and i looked pretty stupid then. i'm happy to look stupid, as long as things turn around eventually this is an amazing opportunity i mean, i think people are getting involved now, they are going to look back and say, hey,

this is one of the -- this was a transformative time, really interesting time, where the world started to really open up, governments started to compete for us as opposed to the other way around >> arguably, it has to go that way if you're a buyer at today's prices we'll see how that plays out tim, we do certainly want to ask you, though, about your former partner who left efj over issues of dealings with several women and i wonder if there's any ongoing issues, inquiries, just in light of all the general kind of allegations and resignations related to sexual misconduct >> steve's been a great partner of ours for a long time, great investor he will continue to be a great investor on his own. dfj will continue to operate as a great institutional investor

i run now draper associates, and we continue to make some really innovative investments and things are going well on all fronts thanks >> that's on the investment side, but culturally you don't think there's anything that carries over that needs to be looked at? >> culturally, you know, i think each group made a decision of its own to operate the way they want to operate, and i think they are moving forward. things are going fine. thank you. >> all right tim, appreciate your addressing that tim draper joining us this morning. when we come back, former frontier communications ceo maggie wilderotter weighs in as the president of espn steps down we'll discuss what tt ulhacod mean for a fox/disney deal that's on the other side of this break. freaks some manners! good luck out there, captain! thanks! but i don't need luck, i have skills...

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we will be able to analyze the flow of traffic. that data runs across our network and we use it to optimize the timing of lights, so that traffic flows easier and travel times are shorter. who knew asphalt could help save the environment? coming up today on "halftime report" at the top of the hour, the big question for anyone in this market, how hot can tax reform take this incredible rally? plus, the analyst causing a tweet storm on wall street today. twitter is up more than 8% it's our call of the day and famed sports talk host mike francesa is in the house by the way, jim cramer is with us, as well. we're taking your calls. it is a big hour and it starts in about 15 minutes. john, we're going to have some

fun today. can't wait to see you guys top of the hour. >> absolutely. sounds like it, scott, thanks. meanwhile, espn president john skipper resigning from his position this morning citing years of substance abuse, so how will this impact the media landscape? joining us right now, maggie wilderotter, ceo at frontier communications maggie, good morning >> good morning. >> espn, incredibly important property, sports and sports rights key to the media landscape these days how important is this as a period for disney to get a new leader for espn and get grounded as they try to move forward? >> well, i think you first start with john skipper having the courage to do what he did, and also the reaction by george bodenheimer and iger in support of him the good news is, george is going to come in and take care of espn, he's a seasoned veteran, knows the business

inside and out, so espn is in good hands as they look for a new leader, but as you think about this merger -- go ahead. >> i was going to say, as a ceo, you have done a number deals, none at the scale of disney/fox, but to have a leadership vacuum as you're trying to integrate two massive companies where sports is a large portion of that, how hard is it as a ceo to try to fix those two things at once >> well, i think that george bodenheimer has a lot of experience with espn at the helm, and so he has done many acquisitions and actually forays into new businesses when he was the leader he also never left espn, because he's been chairman so he's up to speed on the company itself so i don't think they aregoing to really miss a beat. i also think that george has a really good sense for the values of the company and what he will need to find in the next leader for espn and don't discount the fact that fox has a lot of sports talent that could be looked at for this, as well.

>> and, maggie, as disney and fox do this deal, they are in a media sector broadly defined that has the big players from telecommunications, from your old area, that have decided in one way or another to become content companies. at&t, obviously, time warner, verizon in a smaller way is that something you think they have to do at this point, will they be successful, are they just kind of, you know, being forced into these moves to spend this kind of capital in a desperate way? >> well, i think both at&t and verizon as good examples, and comcast, started on the distribution side and actually moving in to have content as part of that play is extremely important, because distribution gets more and more commoditized over time. so i think all of them believe in it. i don't think they feel they are forced to do it. i think they see it as the next step for their businesses in order to continue to create

shareholder value. >> maggie, when you look at the fcc's moves last week on net neutrality, how should investors play that? consumers clearly very concerned that isps are going to take advantage of them in this situation. what's your take >> i think it was a great move on the part of the fcc, because the net neutrality rules that were put in place were, as you know, prehistoric rules back from the old telecom days when it was a full monopoly we're in an environment today where it's very competitive, and if you look at the track record, even before those rules were put in place last year, the track record of the distribution partners were not about throttling or discriminating against content. and i think all of those leaders have come out to say, look, our customers are important to us and if we want to keep customers on our networks watching and using our products, we need to make them widely available, so i think it allows everybody to compete on a level playing field

and at the end of the day when the market decides, consumers win. >> small businesses, though, maggie, would disagree with that and say they are not getting a fair shake, and certainly now democrats and attorneys generalo the vote which now seems like it might have been the easy part. as a business leader in this area, what sort of certainty would you advise people that this is actually going to happen and within what time frame >> look it we've allowed a number of new entrants from the internet space into the field of distribution and content and what is happening they have become big behemoths and they are trying to protect their turf it's not unusual to see them go after the government to try to stop something like this because it gives them competitive advantage if something changes and i don't think that that's the right thing to do, but i think we've seen that as part of history, and i really do think

marketplace dynamics is the right place for capitalism to thrive and for shareholders to win. i also think that if you look at this deal for time warner and at&t, it is not a competitive elimination deal it's -- it doesn't hurt anybody. it's one of those deals where we've seen a lot of these deals happen, and i do think that it's also -- it also bodes well for time warner to be merged with at&t and to have that group of assets together. >> yeah. seems like a major issue is that customers don't trust the isps though maggie, great to have you. former ceo at frontier communications >> now we want to get an update on the amtrak train derailment in washington. sue herera has been watching all of the details come in hand has more for us now hat headquarters. >> indeed i do kayla, we now have a statement from the pierce county spokesperson they are saying there are multiple casualties and the

casualties include multiple injuries and fatalities. the amtrak train derailed at about 7:40 a.m. local time it is a new route. this was the first day of this route between tacoma, olimpia and ultimately down to portland, so the -- the train was packed because it was the inaugural route, and as a result of that, amtrak had basically -- they were having a little bit of a celebration of this new route because the traffic in in a area is so difficult at that hour of the morning, so this is a new route for that train first day it detailed and half -- part of that train is hanging over i5 southbound near olimpia, washington i5 southbound is now completely closed the backup there is estimated at 12 miles obviously they are asking people not to travel to that area if they don't have to a kntv report, a local affiliate there, telling nbc that on this

new route most of the seats were filled before the crash in the part of the train where he was reporting from part that have train is hanging over the overpass. we have word of multiple casualties and perhaps multiple fatalities that's according to a sheriff's spokesperson for the pierce county we will keep you posted. we are basically seeing emergency vehicles come into the area a large number of them pause it does appear as though that train was quite full i'll send it back to you guys. i'll keep you posted on any numbers that we get in terms of injuries or fatalities back to you. >> all right thank you so much, sue herera on that train derailment in washington when we come back, much more on this tax-fueled market rally as the dow eyes 25,000 but, first, rick santelli, what are you watching today >> you know, i continue to watch the yield curve. there's so many factors that are making it flat we're going to look at several of the important runs because, of course, many are looking at this trade as an indicator, an

economic indicator we'll touch on all of that after the break. oh yeah. no. at cognizant, we're helping today's leading manufacturers make things that think and do automatically. imagine that, a world of new digital products and services all working together for you. can i borrow the car when it's back? get ready, because we're helping leading companies see it- and see it through-with digital.

let's get you back out to the cme group. rick santelli is there with his santelli exchange. hi, rick. >> reporter: listen. let's look at some charts and start all these charts september 2017 let's look at two-year note. they basically from that point in time to right now, they are up about 60 basis points 3s, up about 57 basis points

look at the five-year chart. up about 52. seven years, up about 41 ten years, up 33 there's your flattening curve. of course, short maturity yields are up long maturity yields. everybody is talking about that and the federal reserve. there's so much more to this story. let's consider how many rate hikes have we had from zero to 25 we've had five march of 2017, july of '17 and december of 17, and here's where it gets interesting. i would pick september, right. the last hike we had was december 13th. prior to that you had to go back six month so why all of a sudden in december, and what does it mean predicting where the yield curve is going to be and trying to predict the flat fling is really much more art than science consider how unequitable, you know, 60 basis points and that's, like i said, we've had only one increase since then

25 well, obviously one would say they are expecting more. but maybe we're forgetting a couple of big points here. let's pick the dow jones industrial average from september to where it is now, and, boy, i need had a calculator the way it's going up, but we're up about 3,050 points the economy, think about the economy. think about gdp. think about the implications of tax. how much of that was known in the beginning of september? the point is that we have growth we have predictions of more growth we have the type of policy with this administration that may be fuel for more growth and maybe some magic things like business spending and higher productivity all of this and the fact that we're seeing this coordinated synchronized global expansion is part of why we may be looking like we're getting over our skis on the flattening curve because it is outpacing the expectations

the reality, but there's also a part "b" to this story we've talked about it many times. our yields are juicier, especially the long end. 30-year bonds than many of our counterparts around the globe even considering foreign exchange so i would look for haul of these dynamics to continue, and i would look for inversions within the curve because i think with two to four expectation next year, the more growth we get, the higher stock prices we get, the flatter curve we get jon fortt, back to you. >> rick, i'll take it there. very good context on the drama over the yield curve which is getting talked out hopefully soon guys, thanks. if the dow closes higher today, it will set a record for the most all-time records in a given year i think it's 70. which really just -- i mean the superlatives keep piling up for this market which really just says you didn't even have a pullback so almost every time it continued a little bit higher it was a new record high. kind of remarkable. >> if there is a slogan for the

market this year, i guess it's past performance is no guarantee of future results but in a positive direction. >> all rules of thumb didn't work if they were implying negative outcomes, right sell in may, all that business. >> still have a potential for a government shutdown this week. >> we have hope for volatility. >> we will see. >> kayla, great to have you. mike, as always. now let's turn it over to wapner and "the half. >> and welcome to "the halftime report." i'm scott wapner our top trade this hour rally on stocks are surging again as the tax plan finishes the near line with dow 25,000 within reach how high can the major averages really climb with us for the hour, joe terranova, josh brown, pete najarian, sneaks's jim cramer host of "mad money" and also with us is mike francesa, th