that still may be true, but they say there's a technical reason for it >> did you guys get that siri quote that someone came in, that she came up with when he addi dictated, look into the syrian thing, that crashed just a pumpkin. that's what i get. >> have a great day, everybody make sure you join us tomorrow right now it's time for squa"sq on the street" good thursday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber at the new york stock exchange. futures higher as the dow tries to avoid its first three-day losing streak in about three months plentyecon data as we watch companies respond to the tax bill europe's roughly flat. final q3 gdp revised down just a touch, still solid at 32

claims at a five-week high bon employee bonuses of $1,000 at some places. >> now on to the next total in washington the shutdown as the deadline approaches we'll go live to d.c. for the state of play. >> and the apple conspiracy theorists were right the company does slow down your old iphones and consumers are upset. details on that, coming up first up, though, as the tax reform bill awaits the presidentpresiden president's signature, many companies announcing bonuses, pay hikes and capital spending sn initiatives. at&t will invest an additional $1 billion in the united states. our own parent, comcast, says it will give $1,000 bonuses to more than 100,000 workers and spend more than $50 billion over the next five years in infrastructure boeing, $300 million in workforce training and facility enhancements for its employees both wells fargo and fifth third raising their minimum wages to $15.

fifth third also handing out bonuses to 15,000 workers. kudlow a few moments ago on twitter said he's never seen anything quite like this >> well, look, it is, as they say, suey generous we've never seen a tax code change like this which is -- geez, the money's right in the pockets of companies. and i think that they do need to share the wealth i was listening to people this morning talk about it, and dom chu was on and he was saying to seema mody, it seems cynical i don't know, $1,000 in your pocket is not cynical. it's good. it's a good thing. >> do you think there's a coordinated effort, that there was some sort of conversation between some of these companies or some sort of coordinating body that said, this is something that might be a good thing for you to consider doing? i don't know just curious that -- i don't think anybody was anticipating it, until we saw the announcement from at&t, and then it was so quickly followed by wells and fifth third, our parent company but, obviously, there's so many

others that could be doing the same thing >> if it was coordinated, it should have been more than six companies. if fifth third and called wells, wave got to get -- >> why is everybody picking a thousand bucks why is that the number could someone have gone with $1199. >> 13, 14, 15, sold to the man -- >> why $1,000. >> i don't know. it did seem. >> it's a round number >> we went through a few hours of cynicism, david, where people thought the at&t announcement was related to something else. >> without a doubt and i tweeted this, of course, so did so many other people who said, wow, look at that. would it have any implication at all for the -- for what is going on in terms of their fighting u.s. government, which wants to block their ability to buy time warner i do believe, and i said this later, that the plerceived politicization of the antitrust process certainly colors these kinds of things, even if they have nothing to do wit

which is unfortunate regardless, unfortunate, because, of course, we have talked so often as to the questions of whether the trump administration's doj acting in a way given the law doesn't seem to be on their side, at all, that has something to do with his distaste for cnn >> well, if you work for them, if you work for at&t, you read a headline, just got a thousand bucks. it's a lot of money. >> it is >> i don't know. it doesn't matter why. doesn't matter why >> well, maybe not on the list of s&p companies with capex budgets, at&t is number two only gm has a higher capex budget -- >> and they have been. they cost a lot of money to -- >> that's part of the reasons why. >> they keep those sell sites going. our parent company, by the way, going to spend $50 billion again, we're also one of the larger capex spenders. but you've pointed this out, the most important single component of that tax bill may be that 100% ability to expense immediately.

>> i think you're going to see orders for planes, which are already just through the roof, go nuts here i just think that everybody's involved with ecommerce doesn't have enough play, united parcel, fedex. but i also think, what would happen if verizon came out and did $1,000 today >> i would argue, it's probably likely >> i know, where are they? where are they >> i don't know. you talk to them all the time. >> i do. >> that's one of your guys >> could you speed dial lowell mcadams and say, listen, where are you with the g >> i could see >> tell him we need the g. >> the g >> thousand. >> got it. i don't usually deal in sums of that amount. i'm not like you that have them piling up in my pocket >> who was it, salmon chase was on that? i'll pay $17 for it. >> i'll pay $18. >> we're going to watch for more corporate response today of course, there is the ongoing

agenda for congress, and that is now trying to avert a government shutdown our kayla tausche is in washington as we turn our attention to this morning. morning, kayla >> reporter: good morning, carl. the house this morning unveiled the tenants o s of a bill thatd keep the government funded until january 19th in addition for all government funding being covered for that time period, it would be a short-term extension for the programs like the fisa surveillance program, children's health insurance, flood insurance, and there would be a little bit more money for some of the veterans affairs issues and some more military spending, as well. a disaster relief bill worth some $81 billion could get gummed up because the senate wants to make some changes but the house rules committee this morning is already meeting to try to get the process in motion for a house vote, timing tbd, to happen this afternoon. and all of this procedural stuff is happening, despite the fact that house leadership, i'm told, is still whipping votes to get support needed to cross that

218-vote threshold when this comes to the floor later today not to mention the fact that if there are objections in the senate, which needs eight democratic votes to pass this, that could invoke some 30 hours of debate, which would take us right up until the friday deadline at midnight house speaker paul ryan seemed to reference this in an interview on "squawk box" last hour >> i think the democrats are going to try to play some partisan games today they would love nothing more than to see a government shutdown, blame us for having it, and step on our tax reform message. but we're bringing a clean what we call vanilla cr no games, no sneaky things just a continuing resolution to get us through this moment, to get us into next year. it's as clean and simple as possible it's what the senate on both sides of the aisle are asking us for. but i could see the democrats trying to play some procedural games. >> reporter: he says both sides of the aisle are asking leadership for this. everyone we've talked to here on the hill says that there will not be a government shutdown, but the devil could be in the details, because there are still several disagreements about how

exactly you get there. carl >> kayla, we'll watch that today, as well thank you. kayla tausche. even into january, we'll talk about maybe infrastructure, maybe welfare reform we don't know. >> i think welfare reform is definitely on the agenda we know that, speaker ryan has been saying that there is now, i think, a queue i wonder what happened to infrastructure but then again, they just spent more than they had on the tax bill shouldn't they spend more than they have on infrastructure? >> right there had been a thought that you could have connected everything in some way, done a whole -- a more wholesale kind of reordering of -- >> holistic. >> holistic reordering of priorities i don't know do you do an infrastructure bill and what could it be how big could the number be? >> if they did a gigantic bond issuance, that is dedicated to bridges, tunnels, airports, turnpikes, i think people would be thrilled by it. i told you, that was the mag pot. make america great again bond

that i had suggested >> you were calling for that a year ago i've got to get back to that >> deficits don't seem to matter anymore. why not just keep spending >> they better start printing the $1,000 bills, which, hamilton is on the it and then grover cleveland >> hamilton? he's on two bills? >> well, it's a special edition. but what's interesting, it costs you $1,000 to get a "hamilton" ticket, so you buy a hamilton with a hamilton. and the madison is on the 5:$5 and if you spill long island iced tea on it -- >> woodrow wilson is on the $100,000 note. >> really? >> we finally found a bill jim doesn't carry. >> woodrow wilson. >> get a couple of wilsons o out. >> let me look at that bill. >> while you're doing that, jim, apple is addressing claims that it deliberately slows down older versions of its iphones.

the company says it does take some measures to reduce power demand in those phones to reduce the phone from shutting down the issue stems from the fact that the lithium ion batteries degrade as they get older and have problem supplying power for certain apps this has been a long time theory about -- >> yeah, conspiracy theory, frankly. katie huberty wrote a note about iphone adoption for the 10 in china being much better than expected i think that's moving the stock. before that notecame out apple stock was going down, and i think it was off that story. i don't know i mean, you're kind of locked sbo into the ecosystem, so maybe you will upgrade yesterday, there were a lot of people saying that there is great availability for the 10, so therefore you should short apple. they wanted people to not have availability well, then we would have shorted apple. so under no circumstances was there a way that you wouldn't short apple. they lose each way, right? too much inventory, they can't sell it.

too little inventory, they're idiots >> loss sales, right >> right >> tim cook, what does he wake up in the morning and says, wow, i didn't make enough, but i made too many go get a hamilton and buy me a $10. >> i'll take a wilson. they've got plenty of wilsons overseas >> they print the wilsons. >> bringing a lot of them back at a low 15% tax rate. >> in 2004, there's lots of studies which show that a lot of it went to, at one time, repatriation stocks, stock buybacks this is very different i would contend that's a little too cynical. that not all the money -- it's a continual stream that was a one time only, so they bought back stock they shouldn't have. i admit, just a handful of companies really skewed that but i think the money is going to be used -- you're not going to get $1,000 every christmas, but i think the planned equipment is going to be real. i really do. >> so you don't think -- >> i know you do >> much like carrier a year ago,

remember carrier made us hope, perhaps, the expatriation of jobs was going to cease. it didn't, right >> it's curious you mentioned that unit ed technologies is expandig everywhere that's carrier they're expanding in west palm, have a giant plant in west all, they're expanding in connecticut because of the joint strike fighter. they have to build many more lines. >> but there were a lot of announcements right as the president took office, if you'll recall, about adding jobs here or there many of them did not add up to anything near what the numbers where and it sort of was this spate that then died out and we never heard much more about it i think to carl's point. carrier, if you look back, i don't know how many jobs were ultimately saved there, not many >> but the global -- they've got this geared turbo fan at united technologies they've had three lines to make this giant, giant engine for aircraft they're going to expand to five. and they're going to do it in america. so let's, you know, maybe hvac, very low-tech.

but the highest-tech stuff, to meet the demands of the airlines, they're going to substantially increase the number of jeengines they make a they're going to do it here. it's important to not be too cynical. it's going to be done in this country, west palm, connecticut. >> that's good >> isn't that good >> absolutely. >> try to find the fault in that he's making too many engines and he'll have to cut the price. >> they got past the engine problem, right >> the engine problem is fixed as of q2, it's fixed >> when we come back this morning, facebook under fire, again. this time for allowing for discrimination in job postings along with other companies got some details on that, coming up take another look at the pre-market six sessions left in the year. dow's currently best since '13, but if it can imagine just a few more tenths of a point, looking at the best year for the dow since 2003 back in a minute [ keyboard clacking ]

[ click ] [ keyboard clacking ] [ clacking continues ] good questions lead to good answers. our advisors can help you find both. talk to one today and see why we're bullish on the future. yours.

facebook once again under fire, this time for job ads placed by dozens of companies aimed at certain age groups. a class action complaint alleging age discrimination has been filed in federal court in

san francisco on behalf of the communication workers of america and its members, as well as all facebook users, 40 or older, who may have been denied the chance to learn about job openings. there is a piece in propublica today. we're back to the downside of hypertargeting on facebook, jim. >> i wonder whether -- look, a lot of what is computer driven -- and this one i don't really understand, why they would do that. but i do come back to the idea of something -- there's a guest wilfred frost had yesterday, a british guest, who said, these companies don't understand the responsibilities and they keep making mistakes. and in europe, these are going to amount to very big fines that will ultimately add up to earnings per share the companies periodically read th they're getting more responsible and then something like this happens and you say, guys, you've got to take a look at what you do. marc benioff, i remember when someone said to him, women aren't paid enough at your company and he immediately got

the spreadsheet and said, oh, my god, all the vice presidents have to make the same. these companies better start realizing they're big and powerful and viewed as governments. >> but the first thing that came to my mind, there's a difference on the job you're soliciting work for, whether you put an ad in the local paper or "wall street journal." there you are targeting prosp prospective applicants -- >> you're right. you're right a little kprexasperating that they're picked on. >> if you speak to shareholders of facebook or alphabet or amazon for that matter, any of the big guys as we sort of were talking about them, and they look ahead, they will talk to you as much as the risk being not about earnings, but about increased regulatory scrutiny of these businesses pinpoint starts in europe, to your point, where you're obviously dealing with data protections in a strange way, though, they actually -- they're doing away with targeted advertising could help facebook, because they had

their closed ecosystem and were relying on being targeted outside of -- but nonetheless, increased regulatory scrutiny has got to be a key risk for these companies. >> they need a chief risk officer related to governments i think they should all be thinking about that. have a point person, not -- you know, play a little more offense. too often, they hire lawyers to be able to fight something that i think they should have seen coming, given that they are not liked. many of these companies are just not likedoverseas. because, again, because of the big brother aspect because of the power they have and the power is unprecedented i've never seen companies be so all-pervasive in people's lives. >> i think that's a fair point and europe is typically ahead of us when it comes to these types of protections and privacy so we'll see what happens, if nothing here i would say on the m&a front, for example, don't expect them to raise their head up in a significant way. because, that again, brings more

regulatory scrutiny. now, now amazon and whole foods closed in record time, especially in these days, but i think it's going to be more and more difficult for these companies if they were to consider doing something that is not organic. because, again, it just brings up this idea of power. >> i'm totally with you. i think these are companies that are viewed as the enemy of jobs, enemy of job creation. zero sum, we were talking earlier with speaker ryan about the notion of a zero sum world i think that a lot of these companies are zero sum and that's a concern zero concern -- zero sum in that there are highly paid jobs that amazon's taking. now, they will hire a lot of people, but not at highly paid jobs and i think that wealth tra transference is very bothersome to europe. >> sure. it's a far cry from talking about them as the most dynamic part of our economy, which we were saying a few years ago. >> yeah, f.a.n.g f.a.n.g. could be -- well, not

netflix. that isn't fair. what has netflix done to them? >> yeah, netflix -- >> they don't have that kind of power. >> they're just a force for good their first words and their initial public offering, don't be evil. do no evil >> okay. >> which of course means they're going to end up being the most ee evil company ever. they have to that's the way the story ends zp >> yes, lex luthor one more look at futures we're back in a moment this is not a cloud. this is a tomato tracked from farm to table on a blockchain, helping keep shoppers safe. this is a financial transaction secure from hacks and threats others can't see. this is a skyscraper whose elevators use iot data and ai to help thousands get to work safely and efficiently. this is not the cloud you know. this is the ibm cloud. the ibm cloud is the cloud for business.

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i am told that this is the last mad dash of the year. >> you never know. you never know >> of 2017 >> you never know! >> between you and me. >> oh, my god, you better make it a good one. what have we got >> we have another 40 years of mad dashes, david! >> okay. finish line. get this when do you remember that they boost forecasts? it boosted the forecast this morning, pretty big, from 50.60 to 59.67 most important thing, comp store is good. but david, everyone is running through to nike, which reports tonight, saying this is probably good for nike. i agree with that. but there's another element. they're in macy's. they expect to deal with mid-300 millions of macy's but macy's people are doing plus

0.23 in macy's some of that may be because they're doing better than the rest of macy's, but isn't that a positive thing not just for nike, but for macy's >> people are coming in and maybe buying some other stuff. >> jeff gantt, i want to read through this and think, maybe isn't going to have that negative of a retail comparable store sale and macy's is very cheap if that's the case. >> meanwhile, this has been kind of episodic. we were worried about footlocker for a while. >> and then footlocker, va-voom! and finish line tends not to get the best new nikes as footlocker does i like this macy's call, if only because the way the season fits, the saturday/sunday shopping i don't know >> i like the readthrough on macy's >> you like that >> i do. >> be careful, bed bath, i didn't think it was that bad, but the analysts hated it. >> maybe we'll start talking

retail as we head into next week where all we'll be doing is talking retail, i guess. that was a great end of the year mad dash we have the opening bell coming up next.

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you're watching cnbc "squawk on the street," live from the financial capital of the world the opening bell in about a minute's time. busy thursday as the biggest tax overhaul from 1986 now awaiting the president's signature. we've seen companies of all stripes respond to that in different ways and we'll be looking for more of that today what a day for macro data. we've got gdp at 32, claims at 245. some of the polling, architecture billings and today philly fed have all been strong. >> yeah, look, paychex is not as strong as i thought, but we'll talk about that later. i really suggest that people go back over the fedex conference call it really lays out how we can get higher gdp, what's going on.

this morning, there's a company, xpo logistics, they're talking about a dramatic increase in the amount of ecommerce. they're talking about 24% spike in efulfillment. unbelievable wow, ecommerce so strong >> there's the opening bell. you can see at the bottom of your screen, it's the emerging markets, internet, and ecommerce etf celebrating its third anniversary. at the ipo, lexinfintech holding. >> i'll tell you, one of the great themes out of china they want cleaner air, and that's one of the reasons alcoa has been up so much. smelting is a terrible thing for air if you don't do it right but have you noticed the china story has kind of faded as our economy grows? remember how we used to think, how's cummings do?

check into china now if you want to know how cummings is doing, check into the u.s. positive story positive >> what part of the business do you check in on the u.s. with cummings >> for companies >> with cummings in particular or are you just talking about -- >> class "a" trucks demand off the charts again, that puts a lot of people to work. i know people at home are probably thinking, what a polyana. when class "a" trucks are doing badly, say, a lot of people should be laid off you can't have it both ways. >> you have plenty of corporate stories today. bed bath beats by 7 cents. revenue slightly ahead comps not as bad as thought. >> when i read all these numbers, i thought, this is going to be up the analysts really dislike this company. they think that every initiative is not working they are still road kill for amazon and there is a tremendous, let's say, wow, lack of credibility

that the management has versus what the analyst community is saying a lot of it is just because, it see seems like they're throwing spaghetti on the wall, whatever sticks and people are using a very high-teens price target. listen, it wasn't that bad a call to me, but there was great confusion. what are you database realguys ? you're spending a fortune to try to bring back customers. what's the deal? yesterday, general mills said they were spending a fortune trying to bring back customers, but it succeeded with really some stuff that is, you know, cocoa puffs. you spend for some and people like it. if bed bath spends for money, spends for these customers and they don't come in, boom a lot of people feel like carmax didn't have good traffic that's another one, not as bad >> comp, carmax up 2.7 we were looking for something in the 4s >> yeah, that was disappointing. but i'm still a believer in the car cycle.

i think houston, the storms, you know, people don't talk about the storms, but they did juice some of the economy. >> there's been a lot of discussion this week about what consumers would use some of this tax benefit for. they'll save some. a lot of economists argue, one big theme is retailers focused on the low end because you've got a lot of states, a lot of municipalities working on raising minimum wage. >> dollar tree has been red hot. the question is, will dollar general catch up to dollar tree? i think that walmart -- boy, walmart, every day, it's like, walmart's like amazon. you hear people talking about special kind of shopping, you know, checkerless stores remember, 3 million people are checkers in this country and what are they going to do if they're automated out? any ideas? 3 million people zpl >> it's not going to be good automated cashiers, automated driving. it's hard to imagine employment will increase when you have those kind of potential losses taking place over the next five

to ten years >> i think so. huge supply of people without jobs that means wage pressure -- >> those are going to be enormous challenges. when you pose that question, though, to people who study these things, they say, over time, typically, technology creates more jobs than it actually eliminates. but you know what, those gaps in between the creation and the elimination can be very disro t dislocating and very hard. >> and remember, this is not just people on looms, luddites breaking the -- i mean, this is, there's many more people that could be very quickly laid off if the technology works for automatic checkout and you have to retrain them who? when i say you, i don't mean you, rhetorically, although i wish you would do it >> understood. who's going to do it you? you? what was it, weinstein, you know, from -- >> "a few good men." >> weinberg. >> i recommend you grab a weapon and stand a post come on! come on! >> hey, listen, like they did in bo jest, every man, dead or

alive, must do his part to save zinderjest >> right >> guys, changing the subject, have you noticed discovery jessica reef cohen, do you remember her >> love jessica reef cohen still out there doing it still doing her analysis, upgrades discovery to a buy. >> i told you this was my -- i said it to asla, i saw him at dinner ics, yo i said, your stock's go much higher. >> she's coming out with a story which is that 350 million target they had for synergies is so far below what the real number is going to be, she's saying it's $804 million in synergies. not to put a specific number on it yeah, $804 million net synergy estimate via four primary buckets. that's one of the key reasons for her upgrade. she also cites deleveraging, asset sales, potential buybacks, while noting, of course, that

24% of the flow is sold short. 68% of sellside ratings are negligent or neutral at least, and of course, we are still dealing with celebrated u.s. paid tv subscriber losses. ratings declines but this stock has found a little momentum to help it end the year on a better note, given what has been terrible performance since they announced that scripps deal. >> but according to your interview, mr. bloom bought stoke lower. >> he did. >> like steve wynn, another guy who knows how to buy >> malone is up nicely on that $600, 700 million -- >> is that a rounding error for a man like mr. malone? >> yeah, that's couch money. he finds a few wilsons sitting in the couch >> you're going to have to print some wilsons you and i will get together. he's a jersey guy, you know, wilson i can show you where his wife lived. his wife lived about five blocks from me. >> i think you can print a few more wilsons than i can. >> i can use block chain technology while i sip on -- let's have a couple of long

island iced teas and do some block chaining >> there's a lot of talk about block chain on long island today. >> you know, fedex actually talked about block chain in a way that was serious they were talking about the block chain institute. and i'm joining that -- >> not familiar with the block chain institute. is that anything like -- what is that like? >> marriage is an institution. would you like to join an institution? >> a lot of interest in hasbro today. jim b. reilly initiates with a buy. we've been talking all week about the trouble with toys. they say "star wars" ip is a plus >> maybe toys "r" us, maybe something will happen there to make it so they didn't wreck the christmas for the toy company, because they sure wrecked the summer for the toys company when they did that bizarre filing >> yeah, it's not been good. >> yeah.

>> it's suboptimal >> these reports of an illness at chipotle not moving the shares today >> you know, i never actually -- this was the first time i heard shorts claiming people got sick. i have no idea how to check that, but, buy mcdonald's. buy wendy's. buy darden what a great number darden was and that was before tax reform >> yeah. do you get the never-ending pasta or salad bowl when you go to olive garden? >> i like the bread. >> you don't even know -- >> it's a breadstick >> breadstick! there's a lot of technology automation now on the table. >> really? >> yeah. >> i've been, but not in a long time i've been once >> when you were young -- when you were 12. >> no, i remember that >> he never goes anywhere. >> that's true i rarely go anywhere they keep me at home, send me down into the subway, i arrive here, and they send me back.

that's it. >> you own a bunch of subways. by the way, that's a good business, if you do it right >> what's that >> subway. a great franchise. >> i noticed a number of closings -- >> you can kill on subways instead of taking the subway, maybe you need to buy a subway >> i need to buy something i need to figure out a way to become a pass-through. if you have any ideas, let me know >> how about corker this morning with joe, becky, and andrew saying that he thought pass-throughs were treated too generously this time and that there might be some adjustments to the bill overtime >> i was dealing with a major pharmaceutical executive with who told me, i don't know if i want to bring things back here what happens if the democrats win in the midterms and they send it right back interesting. it's also more fungible that be we make it out to be >> on that note, a lot of people will be working very full days right between now and new year at a lot of companies, if you're in accounting, trying to figure things out if your at an investment bank, advising corporations on

potential tax planning related to any capital allocation. you can bet a lot of people, unfortunately for them, through the holidays, going to be working very hard. this is an enormous change to the tax code and it takes next week, two weeks. >> intuit's been a complete winner without the tax code, and a lot of that is because brad smith so good. who knows where intuit can go on this that's another big win intuit's a really great company. z >> we've talked about the benefits to households, bonuses, wages, capex and the flip side is whether or not that manes margins have peaked, right? whether or not people are overestimating the impact on earnings, because this is -- lumber is up 40% for the year. >> when i was on the general mills call, they were saying, listen, the raw cost going up, that's a common heme i wonder whether the home builders, which are still on fire, the stocks, whether they may be peaking

the toll brothers, which has a lot of new york, maybe peaking on the -- what's so funny? on the conference call, they said, that's not the case. let the whole class in on the joke >> i'm sorry our producer, shannon, is making fun of me. >> i'm glad we pointed that out on national tv >> because i've never been to an olive garden guys, before -- i know you were making your point on toll brothers we should also point out these heavily levered companies, some that are public, some that have significant debt payments, the interest is only going to be deductible up to 30%, of what represents 30% or less of your ebitda above that, you're not going to be able to claim a deduction that will have an impact, also >> can i give you a bullish thesis for goldman sachs off that >> you're going to borrow money in all sort of countries worldwide, because they have better rules and you need a u.s. adviser to do it. any of the major banks that have

their tentacles overseas, you can raise numbers just on that because they can advise -- listen, you'll have to do debt in france, debt in germany who can do that that's based here goldman sachs. that's why they're going back to the old name of golden slacks. >> that's why they're going to be very busy over there. >> and they're going to make a fortune. and i think the stock can expense. >> you do? >> yes, i do >> the advisory on great capital allocation about how to go about doing it, particularly for heavily indebted companies >> and companies will be desperate to do that because of exactly what he said david, that is another fine print, you know, ripple. i don't mean ripple, block chain, i am talking about literally a ripple that is going to cause people to raise numbers for goldman sachs next week. >> okay. i'll think of you when it happens. >> i might be here >> no, you won't >> you'll be reading from somewhere. >> neither one of you will be here, but i will be here >> okay. okay >> dow adding to the gains today, up 55

now let's get to bob pisani. morning, bob >> morning, carl happy thursday, everybody. remember, the question is, we've been debating all week, what happens after the tax bill do you sell on the news, number one? do you sort of move sideways and continue the rally after that? or do you sort of rotate, which is what wave been seeing in the last month and the answer seems to be a little bit of rotation and move sideways look at the s&p. we topped out really on tuesday, what were we, 2,700 on the s&p you could see that slow descent down 2,700 is top right now we're less than 1% off of the old highs. if you look at sectors, banks again doing well here, even though the yields aren't doing much today retail another star is flat, but started on the upside. and semis are continuing to underperform utilities so let's call this a little bit of sideways action and a little bit of continuation of the rotation into the banks and out of, to a small extent, out of the semiconductor. and this has been a story virtually all month.

meantime, you've heard about the plethora of companies that are out either giving raises or raising capital expenditures, there's a whole group of them. boeing, at&t, fifth third, wells fargo, and our own parent company, comcast not doing too much for the stock, although wells fargo is up nicely. there's been a lot of cynical observations made about the tx s bill, minority leader schumer said everyone's going to go out and buy back stock we've spent a lot of time interviewing ceos about this cnbc's ceo interview has been very aggressive in asking what they would do in 2018 and these are very recent numbers, a couple of weeks old. the last survey, it is true that the plurality said that they would use the money to buy back stocks 41.7%, but a significant group, nearly a third said they would be increasing head count or raising wages or increasing research and development spending so there is a point to be made about buybacks, but if this survey is accurate, increasing head count and raising wages is

also part, at least for a quarter to a third of the people who were out there meantime, have you noticed the ebrokers are doing well? and one of the reasons seems to be the trading activity is bouncing back. we've talked about how more the trading activity has been for a couple of years now. but recently, trading activity has increased. revenue trades at the ebrokers, the daily trading has been increasing new assets are increasing. there's more money in the accounts they're putting more money in and more money is going into stocks and there's less money in cash, meaning people feel -- the markets are more worth investing in and i think bitcoin can get a little bit of credit for it. you see some of this frenzy around some of these small cap stocks around bitcoin that increases trader interest and activity throw the whole thing together, and ebroker have been basically outperforming the market for the last month or so swha shaub's up nicely and you can see the s&p 500 up about 3%. and all the profits are higher so sandler o'neil increased all

the earnings estimates for 2018 for the ebrokers on all of this news you see them all nicely up here today. speaking of ebrokers, etrade is now going to allow customers to trade futures in bitcoin trading td ameritrade, joining interactive brokers. so the door slowly starting to open up. by the way, speaking of the futures, remember a week and a half ago when they started, it was, what, 18,000 on that first day of trading, as i recall. and we're, what, 16140 here. so one thing's for shucure. trading in futures has not increased the overall bitcoin price. right now the dow up 73 points carl, back to you. >> bob, thank you very much. bob pisani let's get to the bond pits, as well. rick santelli at the cme good morning, rick >> good morning, carl. we did see a rise in claims, but we also saw a little bit of a loss inour last look at third quarter gdp.

but not much 0.10 all in all, it hasn't been a bad run for the economic data. and when you add in going into year end, there definitely seems to be a bias as global rates move a bit higher. a lot of that, of course, may be all the legislation in the u.s. turning the market you know, many ask, are the changes in taxes the ultimate reason or the reform the ultimate reason for some of these moves? maybe in part, but i think the actual benefits of the financial aspects of the tax plan moving forward, that proactive, on the fly adjustment may add in a whole lot more over time one week of tens, clearly higher year-to-date of tens, i like this chart you know, we are now toying with the march highs and the 260s and there is enough time to get there. there just isn't a lot of data markets are getting thin but it is the direction. rates are holding, not moving a lot higher lobally lack at one week of bunds. here we are now holding in the low 40s.

if you look at an october -- third week in october start to bunds, that's the last time we were here around the 25th. but the shots, the two-year, the short end that's been minus 85, been minus 75, now it's minus 65 and lack ook at the one-week ch, it's not only kept base, it's leapt. and the historic comps, this is comping to about the middle of july finally, you know, the dollar index is actually up today that much hardly anything. our rates have gone up, so have europe's rates gob ne up. now look at the euro versus the dollar that is indeed responding to some of the recent moves there's a lot of channels that cause foreign exchange to move the way it does. and many of these channels might get a little hotter in year end as there's more of a demand for dollars. but based on the way everything's trading, i think demand will be more on the sell side pushing rates up and the buy side pushing stocks up than

anything that's going to affect the dollar and dollar index. carl, jim, david, back to you. >> rick santelli in chicago. when we come back, former white house chief technology officer, aneesh chopra will join us the dow needs another 70 points for a record high. but for the time being, holding on to a 69-point gain. back after a break ♪ (news anchor) downtown traffic is still bad. expect massive delays. (news anchor 2) all lanes on highway 50 remain closed at this hour. (news anchor 3) the stats are in and this city leads

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of an all-time high but we're watching fang today. mixed results as we got news on names like netflix, apple and 'lgetrin wel t adg with jim after a short break.

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♪ let's get to jim in stock trading. >> chevron, they're raising the price target from 120 to 160 cash flow coming out of

australia. but what's amazing is when was the last time you saw a huge price target increase for an oil company? this would be day four of the oil stocks going higher. if that occurs, a lot of people are going to say that's breakout because they've not had that kind of action really since january -- the beginning of the decline. >> right. >> so i would watch this very carefully. if chevron continues to hold, you're going to see other people come out of their fox hole and recommend oil companies, especially after the article about saw the saudis are shopping >> i saw that. >> we'll talk more about anwar. >> yes i think it's big. >> what's on "mat" tonight? >> i've got paychex and then i've got eagle they sell gold gold isn't as good as, say, i don't know, iced tea but i want

to talk about block chains with him, because i'm a block head. do you remember when gold had meaning? >> yes, i do. >> before it became -- i'm going to put gold in my iced tea and it will be a win/win. >> we'll see you. >> absolutely. >> lipton though, nothing from them >> "mad money" is tonight at 6:00 p.m. eastern time when we come back, tax reform and tech we'll talk to the former white house chief technology officer, aneesh chopra. dow is up 77 [ mouse clicks, keyboard clacking ] [ mouse clicking ] [ keyboard clacking ] [ mouse clicking ] [ keyboard clacking ] ♪ good questions lead to good answers. our advisors can help you find both. talk to one today and see why we're bullish on the future.

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call 1-800-directv. welcome back to "squawk on the street." we have breaking news. this is our leading economic indicators it's a november read we are expecting up 4/10 we received up 4/10. the 1.2 in the rearview miles an hour -- mirror remains unchanged. it's the biggest going all the way back to march of 2010. so this number doesn't watch that but that was a revised lower. and this is a solid number as a matter of fact, if you look at the year, year-to-date, with this number series, obviously 1.2 was the best but this ended up being about the third or

fourth best number so it's pretty solid rates hovering just a whisker below 250. let's see how it looks today carl, back to you. >> rick, thank you very much good thursday morning, everybody. welcome back to "squawk on the street." i'm carl quintanilla with michelle cabrera and david faber of the new york stock exchange sara's off today the dow doing pretty well, up 81 points obviously the tax bill once again front and center and we are paying closer to attention to the house vote on a stripped down funding plan. congress giving the final thumbs up on that $1.5 trillion tax cut. what it means for the street, industry and your money. plus sharing the wealth. several large companies already responding by raising wages or handing out bonuses. >> a canadian jet maker hit with a 300% tariff on some passenger

jets what the ceo told cnbc exclusive exclusively. major companies are sharing the wealth announcing bonuses, pay hikes and capital spending initiatives. at&t announcing it will pay $1,000 bonus to more than 200,000 workers. our parent, comcast, will give $1,000 bonuses to more than 100,000 employees and spend more than $50 billion on stru infrastructure both wells fargo and fifth third raising their minimum wages to $15 an hour. fifth third will be handing out bonuses to more than 13,000 employees. we've had a long discussion this morning with jim about whether this is lasting material, important, significant we'll see. >> it's easy to try to be cynical and say, oh, they're doing this for political reasons, maybe to curry favor. at the same time though we got steve leesman coming up with a story about what he thinks the effective tax rate is actually

going to be for corporate america. it's going to be dramatically lower. i read his script in advance there's going to be a lot more money going to corporations. easy to see how they could spread some of the wealth, especially with 100% expensing immediately. a the. >> at&t is somewhat upset with anybody who would otherwise think that the reasons for doing this are not solely because their ceo, randall stevenson, and their cfo,stevens, have been tasking t asking for tax reform for years, saying it would have been hypocritical not to make an investment announcement once tax reform happened. they want the world to know that, hey, we had to do this we've been the main advocate for why we need to reform the tax code so many times. >> on a shorter term basis we're getting breaking news out of

washington on this spending bill kayla is catching this for us. good morning again, kayla. >> reporter: good morning, carl. the news is potentially what's in the spending bill the question about tax reform has been when the president will be able to sign the bill that the house and the senate passed this week. in legislative texts posted overnight, the provision has been added that would allow the president to sign it it's essentially a waiver for any mandatory spending cuts that are triggered by any legislation that is seen as increasing the deficit. whether it is a short-term government spending bill, whether it's a $1.5 trillion tax cut, that blanket waiver is in the house legislation. it will need to survive the senate version for it to be applicable, but it is in the text that was posted overnight if that survives these various iterations throughout the day, the president will be able to sign it potentially by the end of the week. carl >> kayla, thank you for that for more on how the tax overhaul is impacting the markets, let's bring in senior equity strategist in bank of america

and don schreiber. good morning to you both we can take this sector by sector on impact on industry on the markets. >> it's probably partially priced in. we have a list of high tax beneficiaries. if you look at their relative valuation, they're actually trading at a slight discount to where they were prior to the election when any of this tax reform stuff was on the table. from that perspective it's not being reflected. if you look at the recent performance of small caps versus large caps, relatively muted look at the dollar. >> that was gary cohen's point idea, that high and low stocks didn't reflect that the markets are truly appreciating this. is that what you're saying >> right a second leg is i don't think that you can just -- if you look at what happened for example in 1986, the companies that had

high tax rates versus those that didn't, they didn't necessarily outperform if you look at when we had the dividend cut in 2004, the companies with high dividends didn't necessarily outperform. for me what it means broader is, okay, we're in this globalized recovery, if this can add a few tenths to growth and push investors into euphoria next year, that's where it gets exciting. >> don, is that what the first half is going to be all about, looking for signs of euphoria? >> i think the first half is going to be pretty exciting for investors. i think we're going to get a lot of capital we're going to see buybacks, dividend increases and increases in cap x i think i think that the company does better i think that the economy's trend that's already at 3% could get a boost. we could get to 3.5, maybe a 4 handle on gdp growth in the next couple of quarters that would be really good for stocks i think that earnings are going to obviously get a boost from reduced tax rates, and stocks

look like they're going to go higher i think the big risk is that the fed starts to really worry about the growth effect that we're going to have from this tax act and the current growth that we have which is better than expected before the tax act takes effect they could start hiking rates a lot faster and more frequently than people expect if they do, they're likely to remove the punch bowl -- the strike in the punch bowl and cause a recession some time probably in 2019. >> there was something else that happened yesterday that seemed to suggest that maybe the fed might be braver in raising tax rates, to your point, which is we've been stressed so long. why is the yield curve flattening long-term interest rates should be going up. yesterday we saw the yield curve steepen. now, if you were a member of the fed, at some point you're thinking about raising rates, you want to be raising the short and when the long end isn't moving so much, but now it's moving one, what do you think of the steep in the yield curve

does that suggest that the markets believe this is going to deliver a lot of growth from this tax bill? and two, does it add to your point about the fed possibly getting even more aggressive than they otherwise would have been >> you bet i think that the long end is going to move on bonds i think that the bond market, you know, has been super masmar. they haven't believed the inflation story that the fed has put out there. when the fed raises the short-term rates, the long-term came back in every single time i think that story board changes and i think the bonds are going to be in trouble second half of 2018 that big bond market crash that everybody's looking for, we're going to start to see that unfolding later in the year. >> a lot of people disagree with that, mark, because once the conversation turns to entitlement reform, theoretically the savings rate continues to go higher, that's disinflationa disinflationary. >> i think in the short term in

the first quarter of next year we're looking for the ten-year to continue to move higher then you're probably going to get some bouncing effects from people looking later into the year, what's the ecb going to do, they're going to curtail the bond program, bank of japan, et cetera you could see some smoothing out there, probably end the year closer to 3% but the bulk of the moveup is going to be the first year back to your question on inflation, we are decades low in terms of the unemployment rate and now this could be a catapult to see a little bit of wage pressure for that reason, we've seen a move up in the discretionary specters but they're one of the biggest employers. when you start to see rates increasing, it tends to underperform. >> a move to three would not be a breakout of a ten-year trend. >> more on the wage pressure, if we start to see that wage pressure build over the course of next year. >> i meant 3% on the ten-year. >> got it. >> don, given all of that, if

wage pressure becomes real -- when do we start talking about or wondering about corporate margins having peaked? >> i think corporate margins and the comparisons of earnings quarter over quarter are going to start to get tighter. i think that companies are going to get this initial boost from the tax cut and then they're going to have to really earn their keep i think that a lot of capital, unfortunately, will be wasted and thrown into buybacks to make it look good for a little while. long term i think that the earnings rate, the comparisons we've been experiencing which have been quite good, are going to start to wane. >> it's going to be an interesting 2018 guys, thanks so much i read steve leesman's script in advance. you got to hear what he thinks the effective tax rate is going to be under this bill. digging deeper into the i

implications, we look at the industries that will benefit and be hurt by the tax overhaul. >> interesting numbers taxes are coming down for all industries but there will remain big differences between industries as to absolute tax rates and big differences into how much of a tax change that they're going to enjoy let me just tell you what michelle is asking about the first thing you have to know is that while the statutory rate falls from 35 to 21%, penn wharton estimates the tax rate falls from 23 to 9% because so many deductions were left in and the expensing was added onto that they also find big differences among industries and investors can find better results at picking more carefully the top highest, agriculture, health care, educational, construction, transportation they're around 16 while the average goes down to nine.

here are the lowest five manufacturing, real estate, holding companies, accomodation, mining they're ten below relative to the total. now, that tells you which industries enjoy the most and least favored tax rates. which ones get the biggest decreases? i crunched penn wharton's data to look at which industries could show the biggest earnings increases because they're going to get the biggest tax changes here you go without much waiting here real estate gets a big tax break relative to their existing rate. agriculture, utilities, minus 13 percentage point change. health care, transportation. let's look at the bottom five industries relative to the current rate arts and entertainment, information, mining and manufacturing. relative to the current rate, they only get a 6 percentage point decline. note, a big part of the estimated change comes from the five-year expensing holiday. that means that in five years, 2023, many of these effective tax rates will rise.

so all industries win. some win more than others and as always, careful choices could lead to better returns if you're playing the trade. carl, put that in your pipe and trade it >> really, really good stuff we've been watching your full screen there steve, is tech a net loser in terms of the relative potential gain >> in terms of the relative -- they're not as high up because tech doesn't pay such high rates. they have a lot of overseas stuff. information was down on the list i believe that includes some tech in there in terms of those with one of the lower tax changes. >> fascinating we got to get some stills of those full screens those numbers are impressive. >> tweet them out. 9% effective tax rate, holy smokes. >> hey guys, hats off to my band mate bill who put me onto this story. he said, wait, if they're leaving in all these loopholes, what happens to the effective.

finally penn wharton crunched the data and came up with this 9 number we'll see what others come up with another category will be effective marginal tax rate. >> quickly on the deficit, those assuming $1.5 trillion cost, were they making those assumptions based on that effective tax rate >> i don't have the answer to that question. here's what i know, david. i know that the penn wharton folks have a higher deficit from this bill, 1.9 to 2.2 i do not know if it's because they come up with a lower tax rate for corporations. >> steve, thank you. when we come back, a lot more on the tax overhaul, its impact on technology, health care with former u.s. chief technology officer, aneesh chopra who's with us christmas upon us, retailers getting ready for last-minute y ith, but a big shipping snag maben e way. we'll tell you about that, with the dow up 88.

the countdown is on and retailers are getting ready for last-minute orders the shipping is complicated. courtney reagan live at an amazon prime hub in new york

city with more on those complications. >> reporter: that's right. christmas is on a monday that means christmas eve is on a sunday so shipping times are even shorter yesterday we were at a shipping facility in kentucky on the last day for ground you're out of luck if your one order online is standard don't worry, there are retail solutions. we're here at amazon's prime now hub in new york city and the employees are packing orders, getting them ready for delivery in new york city which often happens by foot, by bike or even by subway. amazon prime is available in about 30 densely populated u.s. cities, about 25,000 commonly ordered items are stocked on what look like library shelves as opposed to an automated warehouse. it's estimated that 5% of amazon prime households use prime regularly every month. grocery, personal care and household items are the most often ordered. i understand paper towels, according to amazon, the most

popular item that may not exactly fit your gifting needs. a scan of e-mail receipts done by slice intelligence shows that amazon prime is seeing about a 2% increase in orders so far this season. last year on december 23 that did spike up a little bit. you saw it jump to more than 3% for those last-minute orders so that may very well happen again. amazon prime now isn't your only option of course you've got other retailers that are trying to use their stores on the ground and then start-ups to help them deliver those goods to you same day with orders. but it will cost you best buy has 40 cities for $5.99. macy's is in 33 cities but that will cost you between 8 and $19. kohl's has same-day delivery in 14 cities. like everything in retail, inventory is getting low this time of year, so there's no guarantee that the right size, the right color and product is going to be available.

good luck if you procrastinated. back over to you. >> this is an important weekend, almost as important as the black friday weekend thanks so much. as 2017 comes to a close, it's time for bob pisani's sitdown with head of floor operations art casher. their annual market look ahead at bobby van's right here in manhattan. >> this by the way was our 10th year chatting at cashin's corner two things particularly concerned him about 2018 the first was china. >> my concern here is china. i think they cracked down a little bit they want to get things in order. they have some banking problems. they have some loan problems if that comes back to haunt them, they could be the link in the synchronized growth that begins to brek break i'm going to keep my eye on mainland china and see what

happens. >> second concern is the fed, not surprisingly he has a slightly contrarian view instead of fear of inflation and more rate hikes, art is worried about the opposite >> barring a surprise jump in inflation, the surprise could, in fact, be fewer rate hikes rather than more and powell i think has followed yellen >> typical contrarian for art. i had to ask him about bitcoin of course and you might be surprised what he thought about the federal reserve and other central banks and how they might react if crypto currencies got really big >> i don't think they want bitco bitcoin, but there's an aspect of it that they would like what they would really like to do is get us out of the cash business, have me stop carrying around green pictures of dead presidents and instead have an

all digital economy. they can keep track of that. i think what you'll see is that the fed itself may wind up helping somebody develop a digital currency >> this is a very important point, making a distinction between the government, the fed, developing a digital currency and those private crypto currencies like bitcoin which are more likely to face regulation the full interview with art, "trader talk" on cnbc.com. check it out. >> i bet it will be a fan favorite thanks, bob. when we come back, the trade war between boeing and bombardier what the ceo told cnbc exclusively. don't go away.

record year for the market, what should we expect from hear and around the globe for next year joining us now with her upbeat outlook is jpmorgan global head of research joyce chang. good to have you here.

>> happy holidays. >> reading through the notes and the predictions for 2018, this is upbeat and it doesn't even mention tax reform and the bill that passed finally. does that add to your optimism were you thinking about that as you wrote it >> we were thinking about it as we wrote it and actually raised our s&p 500 target to 3,000. we think the tax reform has some momentum that's going to carry through and we've rotated away from growth stocks to value stocks those stocks have very high domestic revenues and some of the higher tax rates which we think about benefit. so now we like the financials, energy, and materials. so there's still more followthrough to come. >> global synchronized growth. we hear that a lot we're going to get an acronym soon, people are so thrilled about that what does that mean in terms of investing around the world do you stick with the united states is it safe to invest everywhere? >> you have also synchronized earnings growth and that's the very important thing so we're hitting some new records in equity markets around

the world, and we think there's more followthrough on the earnings growth. emerging markets, we still think there are opportunities there. we also see in europe that the expansion is earlier cycle but this is the nine tth year of global expansion so we would not say this is the point to step back, there's still momentum going into 2018. >> this was another year in which political turmoil was sort of discounted to some degree does that continue, especially in europe? >> what we've seen is that the bark has been worse than the bite all eyes are on italy and europe and i think the outcome will be a very large grand coalition i don't think you're going to hear talk about exiting from europe the other thing that's changed is markets are really looking at events in a more individualistic way. brexit did not impact the view on the eurozone. venezuela hasn't impacted the view on latin america. the market has been able to

segment these events. >> people who have been watching cnbc for a long time know that you actually started out in emerging markets and specialized there. are you as optimistic about emerging markets growth and should people be investing there for next year, especially with the talk of rising interest rates here in the united states which is historically negative for em. >> i think that china is going to slow down a bit next year the upside surprising in chinese growth are one of the consistent upside surprises this year we're looking at 6.5% growth, not a huge slowdown but a bit of a slowdown i think that attention will turn to the nafta, the north american free trade negotiations with tax reform out of the way and could you return to fears of protectionism in the dialogue in 2018. >> does that mean don't invest in em? >> we are overweight on emerging markets now on the local currency bonds we also think there are some good opportunities in emerging markets equities

we think what china is doing is actually quite constructive and we're overweight there in latin america we feel that brazil, the external accounts look much better now and in argentina as well but that's a story that's an earlier cycle as far as some of the momentum that could play out. >> bond bubble going to burst in 2018 >> bonds, you'll have a different story than the equity story. for government bonds, for european credit in particular, you could have very low or even negative returns so we think the higher yielding bonds like u.s. high yield, emerging markets, could return 5% to 7% elsewhere you could get a return that's only 2% this is really a point where the gap between equities and fixed income is probably going to grow even more than it has this past year. >> good to have you on happy new year. >> great to be here. happy new year. let's get over to sue and get a news update. >> good morning, carl. good morning, everyone here's what's happening at this

hour two men have been arrested in australia after allegedly driving into pedestrians on a busy street in melbourne leaving 14 people injured in what police believe was a deliberate act, but they don't think it was connected to terrorism one of the drivers has a known history of drug use and mental health issues. polls have opened across catalonia in a hotly contested election over the region's independence drive the election was called by spain after it seized control of the northeastern region in late october. washington state officials re-opening two southbound lanes of interstate 5 following monday's deadly commuter train derailment a third lane remains closed. the speed limit in that area has been reduced to 45 miles per hour and kensington palace releasing two official engagement photos of britain's prince harry and american fiance meghan markle the two will be married on may 19th at windsor castle

that's the news update for this hour over to jackie d with the eia inventory report. look at natural gas prices changing course here, supported by the eia inventory report. a drawdown of 182b cf, a little steeper than expectations, a little less than last year, but the five-year average, negative 134, so well above that. a couple of things happening with the natural gas prices when you look at them on a long-term basis. down 30% year-to-date, down 13% this month two reasons for that we're pretty well stocked and these temperatures are seasonal but they're not colder than we usually have at this point of year so that's not typically boosting demand you can see natural gas now trading at 265 we were in the red before. carl. when we come back, a look at how the tax overhaul could market tech and health care. former u.s. chief technology officer aneesh chopra is with us the dow is up 92 ♪ ♪ ♪ ♪

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biggest tax overhaul in more than 40 years. my next guest it will hurt the economy where it's hurting the most let's bring in aneesh chopra, former white house technology officer. we've talked about sectors that are poised to see a big drop in their effective tax rate tech is not on that list why not? >> well let's first acknowledge that there are provisions in the tax code that will benefit tech in the near term on some of their tax priorities the most important being the ability to repatriate a lot of cash they hold overseas back into the united states that is something that will have an effect, but the broader policies that we've seen between this and net neutrality, i think the story for tech is actually more challenging going forward >> because of this bill or are

you incorporating some other things like regulatory heat from capitol hill or other countries? >> no. the combination of the net neutrality rules which i believe will weaken the american competitiveness in the tech sector and the tax provisions that really aren't necessarily tackling some of the root cause opportunities. the combination of these two is going to be more difficult for the sector to come out successfully, leaving aside some of the short-term benefits as i mentioned on expensing benefits and repatriation. >> on net neutrality, why do you believe it makes our tech sector less competitive the idea behind it seemed to be to have more of a free market so to speak >> that's the rhetoric, but unfortunately, it's done quite the opposite we've put the power of the internet which is largely the economic story of the us, about new startups, innovators having access to this free and open infrastructure to bring their

ideas to life, and we've returned power to really concentrated sectors, the internet service providers and now the large capitalized tech players who can cut deals leaving out the small business and innovators if you believe the growth story in tech is about allowing that free road, we've weakened that story not only domestically but worse, internationally. >> do you really believe that will happen, that somehow these smaller players will be disadvantaged as a result of not being allowed to have enough capacity to reach the people they need to >> yeah because the fundamental point is we've been operating in a series of rules and those rules are no longer available, and as a result, the circumstances are the following. if you have clear rules in the u.s. and we can advocate those rules internationally, then when we go to compete in markets overseas, tech companies in the u.s. have a fair shot. now because we've kind of removed those rules, other countries will respond in kind

our service providers and entrepreneurs and innovators may have a hard time reaching those markets and competing. that's the challenge as i see it internationally. >> why don't we chat amongst ourselves until he puts his feedback in his ear. >> i got it. >> we will see a benefit on the rate, real estate, mining. those are sectors that have had the chance to outsource operations and take advantage of lower global rates tech clearly has been able to. >> well listen, again, on the tax rate issue, there had been a bipartisan view that if we could essentially move to a system where we didn't prioritize or incentivize holding cash overseas but rather had more of a market that said, hey, you got to pay a minimum rate globally but you can bring your cash from overseas into the u.s., that would have a net positive on

capital investment in tech that's something we could have done in a bipartisan basis instead we've created a bit of a per verse model where there is an immediate cash holiday but lingering incentives to keep some cash and income in tax shelters abroad. we've done something that could have been great and made it wonky for the tech sector. i don't think that was a trade worth taking given all the negatives of this bill. >> are you referring to for instance the journal piece that argued microsoft's rate could actually go higher >> well, the mechanics of the rate issue is the following. if i have an incentive to find tax havens overseas where i can actually basically pay under the territorial tax system costs in a country that have lower taxes but i'm not subject to any minimum rate to pay back in the u.s., i might put more capital, more resources into those markets which reduces my desire to bring cash back there's two effects, the net tax

rate, but more importantly, the capital investment in the u.s. you want more capital in the u.s. to grow the economy i'm not sure these provisions are going to get us there. >> i want to understand that you're saying that going to the territorial system could actually incentivize companies to keep money overseas rather than what we've been hearing >> that's right. there had been this bipartisan -- at least i'll characterize it as bipartisan, but a view that if you wanted to adjust this to hold cash overseas the question is if you had a minimum tax base for all activities -- >> they're going to pay a one-time tax on all this stuff overseas and then do whatever they want with it. but now that's -- we've gotten over that hump. >> that's the hump we've gotten over but there could have been a better system that said going forward it doesn't matter if you're in a low tax haven

country or a high tax country, as long as you pay a minimum tax rate you can move your money begin t between the u.s. and abroad that would have been a block against the fear that people are going to find tax havens at really low cost tax shelters and not bring the cash back at all i'm not so sure we got a great trade on this repatriation provision. >> finally, the handful of commitments that we've seen in the past 24 hours, do you think that's going to be a broader trend going into next year once the president signs it >> let me be very clear. the expensing provisions of the tax bill that allow you to put capital to work at a lower cost will have a positive effect to the economy. we saw that in the recovery act in the obama administration.

i remember conversations with very similar isps back then that said the expensing provisions would reward them to put more capital to work today. that may be the biggest issue, not the tax rates or the repatriation piece but the expensing provisions which have a bipartisan history so that is a good component of the bill but in the broader scheme of putting us $1.5 trillion in debt, weakening the health care system, i'm not sure that was a trade going forward >> aneesh, good to get your point of view on it. good to see you again. see you soon >> thank you so much for having me bombardier is caught in a trade war. the u.s. commerce department imposing duties of nearly 300% on passenger jets made by that company. it's a big win for boeing which launched a complaint against its rival. our phil lebeau spoke with bombardier's ceo and joins us with more on this story. >> reporter: david, this is a brewing trade war between the

u.s. and canada revolving around this plane right back here it is the bombardier c series. they've sold 75 of these to delta and that's at the heart of the complaint from boeing as well as the u.s. commerce department essentially it comes down to this the commerce department says if you're going to let this go through at the prices that we believe that the planes were sold at, there should be a 291% tax on those c series before they are delivered to delta. essentially boeing claims that the pricing was so low that it damages boeing in the end, a claim that bombardier's ceo says is not true. >> i think that this is ridiculous, to be honest with you. you have an aircraft here that nobody else produces the real competitor to the aircraft is not boeing attacking this product which is largely a u.s.-based product, creating u.s. jobs, serving the

u.s. market, u.s. passengers, customers, the flying public benefitting from this, i think that people should look at it very hard. >> alain bellemare points out that in the estimation of bombardier, the c series will have an economic impact on the united states of $30 billion and 20,000 jobs over the next 20 years, essentially the life of the airplane as you look at shares of bombardier, keep in mind that this proposed tariff still needs to be ratified or officially signed off on by the international trade commission or it could say, you know what, we disagree, there should not be a tariff on the c series that decision should come by february 1st guys, the folks at boeing as you look at shares, are also going to be watching this final ruling from the international trade commission very carefully. again, we should have that by february 1st guys, back to you. >> big news for the best dow stock of the year. phil, thank you very much. when we come back, we'll

talk to the head of block chain at the world economic forum. "squawk on the street" continues inusa me jt mont when this bell rings... ...it starts a chain reaction... ...that's heard throughout the connected business world. at&t network security helps protect business, from the largest financial markets to the smallest transactions, by sensing cyber-attacks in near real time and automatically deploying countermeasures. keeping the world of business connected and protected. that's the power of and.

by one measure, one strategist says the market is more overbought than it's been in 20 years, but why is there no reason to be afraid? find out on "trading nation. more "squawk on the street" coming up.

now let's get to the cme group in chicago rick santelli has the santelli exchange. >> thank you, good morning i'd like to welcome peter vukbar it wasn't that long ago when we saw central bankers start to do things in their heart that would make the crises more shallow, bring growth more quickly. i don't think it quite worked out that way but that's for another debate i'm looking at the other side of the mountain our central bank is doing the right thing.

kudos to them. but i also think whether it's the less regulation environment, whether it's the new tax regime, all of this is really giving a nice tailwind to the u.s but don't other countries have to follow? is this not like lee iacocca, follow or get left behind? isn't this the relative value trade on stoeroids >> no question we know asia is doing pretty well the problem is their central banks will have the pedal to the metal and are going to be forced to play catchup. the biggest threat to this improvement in global growth is a faster rise in interest rates because these central banks have so overstayed their welcome. one thing that came along with this recovery is an enormous amount of debt even in the u.s., debt to gdp is above where it was in 2007 we're sensitive to changes in interest rates and they are going to potentially be the

roadblock to this continued recovery in global growth. >> i've never believed -- and i heard congressman ryan virtually say this this morning on "swquaw box" -- on the staeroid function aren't we going to see other major economies have to pare down some of the regs? your thought >> i agree there's going to be an extraordinary amount of pressure but at least on the corporate income tax side, we're playing catchup to the rest of the world. it's us that lagged. >> let me stop you there, peter. i hate to be an interrupter. but okay, that may or may not be true we are playing catchup, but all of a sudden the game was arranged in a certain way where it became an equilibrium it became the global comfort

zone just because we're maybe catching up to them doesn't mean they don't want to regain an edge, does it? >> i completely agree. ireland was groundbreaking in cutting their corporate tax rate to 12.5 and everyone sort of followed them. it could be a race as to who's e so i agree >> excellent, because i'll tell you what, peter, i know there's a lot of naysayers, losers and winners with any legislation, but i think we're going to see a global growth spurt and i think that's a wonderful thing happy holidays, happy new year keep doing what you're doing we love to read your output. carl, back to you. quk t see iba you very much "sawonhetrt"s ck in a moment. don't go away. wall street guy.not really a what's the hesitation? eh, it just feels too complicated, you know? well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman? hey, ian. you know, at td ameritrade, we can walk you through your options trades step by step until you're comfortable. i could be up for that. that's taking options trading from wall st. to main st. hey guys, wanna play some pool?

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the volatility in bitcoin continues as futures grow. and nyse ice has filed for bitcoin etf. for more, sheila warren, head of block chain at the world economic forum good to have you here, sheila. >> hi, michelle, good to be here >> we've heard from a lot of the practitioners, but haven't heard from a lot of the big think organizations like the world

economic forum what do you think of bitcoin and block chain technology obviously, it's important enough they put somebody in charge of actually thinking about it >> true. we certainly are bullish on block chain for sure block chain, of course, being the underlying technology foundational to bitcoin currency our view is it's here to stay, whether it's bitcoin that wins the day and keeps its status as the grand daddy currency or something else comes in remains to be seen, but this phenomenon is something that we think has legs, longevity, and the underlying technology block chain really has the potential to revolutionize and transform sectors that could benefit all of society >> could you give me some real examples how is this going to change the world? >> yeah, well, i think it's important to understand what bl block chain really is, apart from bitcoin, and what it is is a creation of a decentralized database that is public, it

engenders trust because there's no centralized authority that's responsible for maintaining the ledger, as we call it, of transactions or records. so when you think about what that means in any sort of system where there inherently isn't trust in central authority, either because you've got let's say a corrupt government or institution that might be incentivized from the people of that society or institution, you have the opportunity now to create a peer-to-peer network where you're letting people really play with each other in a way that can't be changed. that the record of what they do with each other lasts forever, and there's a lot of positive benefits from that >> right does it need government in order for it to survive in a meaningful way >> that's a great question, and the theory is, no. block chain technology is not predicated on a central authority like a government. however, we know regulation has the impact of the technology to scale, and that applies to digital currency, as well.

regulation has the ability to cut that off at the knees altogether, so what we're seeing right now is the regulatory environment around the technology itself is greenfield, anything could happen. and there could be regulation that comes up in other areas that has an indirect consequence on this technology and not allowing it to flourish and thrive >> one application of the future you think might be exciting that we haven't thought of? >> yeah, well, i think when you think about -- here's kind of a random example, but when you think about supply chain integration and the inefficiencies and getting goods from one place all the way through a supply chain to the end state, so when you think about that and the inefficiencies there and how that affects everything from labor markets, to the shipping industry itself, customs and tariffs, putting the record of those goods on to a system like the block chain has the potential to really upend what we think about as the super inefficient transportation systems. so that's gone another one, a company called ever ledger is working on

diamonds and making sure the mining done for diamonds is done in a way that doesn't use child labor, that recognizes fair trade principles, so the labor market implications are significant. >> thank you so much >> my pleasure when we come back, battery gate what apple just admitted that has many conspiracy theorists saying i told you so, when we're back in a minute let's begin. yes or no? do you want the same tools and seamless experience across web and tablet? do you want $4.95 commissions for stocks, $0.50 options contracts? $1.50 futures contracts? what about a dedicated service team of trading specialists? did you say yes? good, then it's time for power e*trade. the platform, price and service that gives you the edge you need. looks like we have a couple seconds left.

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good morning, it is 8:00 a.m. at apple headquarters in cupertino, california. it's 11:00 a.m. on wall street, and "squawk alley" is live ♪ ♪ to "squawk alley. i'm carl quintanilla with john fortt, mike santoli at post 9 of the new york stock exchange. joining us this morning at post 9, busines