good morning, it is 8:00 a.m. in san francisco 11:00 a.m. on wall street. "squawk alley" is live ♪ i am carl quintanilla with jon fortt and courtney reagan. busy morning we'll get to the markets in a

moment first, live shots as students take turns walking out, answering a national call to leave class by the group empower. this is a call for elected officials to act on gun violence as well. seeing crowds outside the nyc today as well. keep our eye on that meanwhile, amidst white house shakeups, the president striking a harsher tone on china, signals of new trade tariffs and will this cause retaliatory measures from china or chinese investors. joining us, dean of the fletcher school of international relations, and former deputy assistant secretary at the treasury gentlemen, great to have you with us. thanks so much. >> you bet >> thanks for having me. >> admiral, the conversation now is about what direction the white house is pivoting in general. not so much clarity on where this all end what do you think the likelihood

is of substantive retaliation from china in particular >> i would say it is pretty high, and as i look at the turn of the wheel with secretary tillerson departing, who had kind of a softer approach diplomatically, bring in, cue up mike pompeo, west point graduate out of the cia, tough minded individual, i think that will feed the president's inclinations to be more confrontational. let's face it, there's plenty to confront china about, not just in trade but geo politically, preposterous claims for the south china sea. the real impact on north korea which could be the big show stopper in asia, i think there's good news there in the sense we're at least getting to the table. overall, look for a confront where we must, cooperate where we can attitude towards china. >> on the list of things you mention, trade deficit,

obviously a problem, protection of american ip, obviously a problem, but do you believe that eventual pressure on north korea through china is the true motivation here? >> i think it's part of it, and let's face it, in the end, all roads to pyeongchang lead through beijing. this summit between president trump and kim jong-un is potentially a good thing i think we should curb our enthusiasm about where it goes, but in the end, u.s. and north korea is not the answer, it is north korea, south korea, u.s., china. watch for how quickly we can get to a four party talk that's how this moves in the right direction on the korean peninsula. >> but there's a lot of concern if tariffs are instituted against countries like china or others, it encourages dumping which is already a problem in so many instances do we have strong enough allies in countries around the world to take our side over china's

what happens if these tariffs go into place on telecom, on tech and dumping? >> i think if tariffs go into effect, china is going to decide how it calibrates its retaliation, and that will depend on level of the tariffs and other measures applied however, i think it is an important time to look at the u.s., china relationship and look to reset it i think the actions that this administration is doing are meant to effectuate that change. in terms of allies we can turn to, there are a lot of nations that have seen how china behaves in terms of ip, intellectual property and i think they're going to join our cause in this effort. >> admiral, i am curious the likely reaction behind the scenes from our natoalit allies, especially the argument that steel tariffs are needed to protect national security, and yet our allies, some of them at

least, might end up being slapped with them. how is that likely to effect nato relationships >> it is going to damage our nato relationships clearly, just to pick up on nova's point, i agree we have a strong network of allies around the world, not only nato, but japan, australia, new zealand, but tariffs against steel and aluminum i think are going to weaken it and as i have said, these are not good economics but terrible geopolitics because they're going to really push our closest allies away from us, and therefore you see the administration in this delicate dance of trying to decide to whom to give exceptions. boy, that gets tough after awhile we have to place a value on alliances like nato, even above some economic concerns i think we can do both >> nova, lot of news out of prime minister may today,

expelling diplomats, limiting visits to the world cup. didn't go so far as to pull rt's license, did say that would be up to internal regulators. does the u.s. have to pick a side or is it not that clean >> well, i think it's a difficult position to be in when you deal with these kind of issues i think united states will obviously have to make a decision on what recourse it needs to take, but given the history of some of the actions by russia, i think it needs to consider whether additional sanctions are necessary and applicable in this instance. >> admiral, i want to go back to what you were saying about allies and the impact on them. the president partly tied tariffs to the idea nato allies ought to be paying more militarily is that likely to work we saw some stone faced reactions when he first brought this up several months ago with

many of our allies standing with him. how does the addition of tariffs into the equation, how is that likely to effect the military spending aspect of this? >> i think these will be two separate streams but we'll have to watch it is like a ghostbusters, you don't want the streams to cross of the military spending and the tariff situation hopefully those can be separated. you know, i spent four years as supreme allied kmanldcommander, banging on allies to get up to 2% of gdp. here's the good news they're increasing spending, they're on a track to do that. they'll get there in the early 2020s. it is progress let's hope that we can keep the economic piece of this somewhat separate from the security piece of it because they have gotten more serious and i give president trump some credit for banging on the allies and increasing their level of defense spending

>> what's the line, imagine every molecule in your body exploding at the speed of light? that's what happens when you cross the strings. thank you guys good to see you. >> thanks. >> thank you very much. as we go to break, another live look at some student walkouts staged across the country in response to recent gun violence seeing pictures on the east coast. this is washington seeing pictures out of the midwest. looks like this might be chicago. even crowds outside the big board today as the 17 minute walkout was intended to remember the 17 people killed at the high school on february 14th. dow down 105 on some pressure from boeing. and still ahead, tech taking center stage in potential trade war with china for apple ceo john scully that joins us to weigh in and google cracks down on crypto the new rule that has the price

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you know what's not awesome? gig-speed internet. when only certain people can get it. let's fix that. let's give this guy gig- really? and these kids, and these guys, him, ah. oh hello. that lady, these houses! yes, yes and yes. and don't forget about them. uh huh, sure. still yes! xfinity delivers gig speed to more homes than anyone. now you can get it, too. welcome to the party. drop box kicking off is ipo road show. leslie vicker is there with more hi, leslie >> reporter: hey, court. in 45 minutes, drop box will be commencing day three of its road show with a new york lunch expecting 200 hedge funds and long only investors at the palace hotel beginning around noon today

presenting will be drew houston, ajay vashi key questions they have about the company before they're willing to take the next step and buy shares key question, competition, how they plan to create that against big tech companies like microsoft and google also, their ability to up the number of paid users for their service. they're a consumer platform, offering their service for free. how do they get users to convert to becoming paid users and also there are plans to move to enterprise, getting more big businesses as customers as the competitor box has been able to do in terms of the ipo basics, this company is seeking to raise as much as $650 million in its ipo. at valuation of $7 billion, which as we have been discussing is a significant discount from the latest round in 2014 where

they were valued about $10 billion. after today's lunch, they head to boston tomorrow for more investor meetings before heading to the west coast and midwest next week. pricing is expected at the end of next week with trading hopefully friday at the latest, guys back to you. >> leslie picker, thank you very much it is a big deal for more on drop box's debut, we are joined by partner, and earn.com ceo, and jeff richards, managing partner at ggv capital. good morning to you guys jeff, it feels like some of the ipos, not to pick on drop box specifically, getting invited to your middle age's friend's bar mitzvah. couldn't you have done this awhile ago you argue unicorn ipos aren't necessarily the best growth vehicles >> well, john, in general, i

don't disagree with your logic companies could go ipo sooner in the life cycle it is interesting, people ask about the health of the ipo market, and they may set off union corns that go public the average tech ipo from tics is -- from 2016 is up this is a phenomenal asset class to invest in you look at octo, went out at 17 today is trading 39. square went out two years ago at $9, last round price alluded to, square is 53 investors that bet on companies that change the way consumers and businesses use technology in the cloud have done well i think it will be well received >> 2% roughly of drop box users actually pay for the service around 11 million out of 500

million users. cash flow number people are putting attention to is from a year when they spent surprisingly little on capital expense compared to other years. how much does drop box have to prove on the road show, especially when planning to ramp up spending on r&d and other items in coming years? >> yeah, that's a good question. i think there's always discontinuity between private market valuation and public market valuation and the reason is the last private market is set by a max process, where folks are bidding and you take the best price. public price is going to be different. i don't think they initially have that much to prove because they proved themselves the last almost ten years maybe a few years ago when google drive came out, dropbox, keep up with the competition they managed to do extremely well in the last several years

i focus on fundamentals, say it is a strong company, wonderful product, lot of consumer awareness, probably do well in years to come. apple is slightly lower, but nearly the $1 trillion valuation. is a trillion dollar market cap justified or more important, what does apple have to prove? what particular newer skill do they have to focus on to prove they're worthy of more investment beyond that trillion dollar valuation they're trying to be driven by the iphone ecosystem >> great question. they've put out some things like augmented reality api last year, apple watch is doing well. i am seeing startups use augmented reality. that could result in the next massive wave of innovation

things like the watch, they said tim cook couldn't innovate like steve jobs but that may change. they focus on the core business. and made up ground, everybody thought february 9th, the market will take a downturn all the stocks recovered since then we'll see what happens >> to what extent is apple driving the investment ecosystem for you? there are a few years everybody was looking for the next hit app, games or what have you. seems to be more attention paid to the android ecosystem, snap turning more attention there how does it look that they're in investing? >> great question. one of the things we look at is the fact that there is 7.3 billion in the world only 330 million in the u.s. the u.s. is an iphone centric universe but the rest of the world is

android centric. china, latin america, southeast asia, these are markets the majority of users buy an android or made by another provider. apple is seen as a lax rebrand interesting to see if they try to player the lower end of the market android is the technology to bet on in emerging markets the last few years. and google announcing they're cracking down on crypto related ads, no longer allowing them includes ads and trading advice. rules go into place in june. until then, seeing the ads all over the place, many of them served by google what do facebook and google know that perhaps the rest of us

don't? they're treating crypt oh currency ads like criminal enterprise solicitations is it people are too often scammed? why do you think they're cracking down so hard on these >> i think they're just cautious as really large public companies. they may not have sources to review each of those kind of ads. what it does, it opens the market for folks who can get out and review ads or formats. >> but google and facebook are pretty much, i mean, they're the big guys in the market overall if they don't have the resources, yet they say gray areas for pornography or gambling, they're willing to deal with those but not cryptos? >> they need to have manual reviewers for youtube videos and

facebook posts saying this market may be fast growing, but given all of the other manual review things we have to do, we don't have band width to review these ads. there may be regulatory or legal risks down the line. it will be a fast growing market i expect providers to spring up just dedicated to it. >> jeff, is this a yellow light for investors, maybe less experienced investors. i see it with high school friends, who wants to invest in cryptocurrency >> one thing we may want to think about, google and facebook, the rest of the world outside the u.s. is important to google and facebook. notably, there are countries in asia that said they have concerns over cryptocurrency this may be related to the u.s.

and companies and their desires to play important role like korea, japan, china, elsewhere i don't know, i don't have inside information on that, but it is a strong stance on an emerging category. obviously facebook has taken criticism for the way they held other categories interesting to watch how it plays out. >> both of you are bullish on cryptos overall. when you have two big forces in digital advertising banning ads from cryptos, does that signal something that encourages other investors to vet in a certain way. >> i think like if you think about late 2000s, google was conservative on social it had an experiment google buzz, and had negative press around it, and unwound that. that seeded a battlefield to facebook and other companies google tried to get in the game late with google plus.

one of the interesting things about withdrawal from doing ads on cryptos, may make it less likely google does anything with block change in the near term. that seeds the battlefield for startups it doesn't effect my or my friends and colleagues' bullishness on the space >> the market is efficient there are certain rules around what regular financial institutions, ipo, security offerings can do i think the same rules will apply. over time the market is efficient and great technology and great businesses will win out and attract plenty of interest >> gentlemen, we have to leave it there thanks for joining us. >> thanks, john. when we come back, united nations under fire after a dog dies on its flight the latest on the airline

industry and dow down 130 after being up 120 or so boeing, worst performing component down more than 3%. back after a break at fidelity, trades are now just $4.95. we cut the price of trades to give investors even more value. and at $4.95, you can trade with a clear advantage. fidelity, where smarter investors will always be.

there's a lot happening in the world of retail. sources tell lauren hirsch, toys r us is preparing for liquidation of u.s. business after it missed a payment to one of the vendors u.s. bankruptcy law gives companies 210 days to renegotiate all leases from date of the chapter 11 bankruptcy filing today is day 177 so when time runs out for negotiations, bankruptcy experts say it is rare liquidation isn't the result for retailers we're almost there separately, walmart has rollout of same day grocery delivery after testing in six cities. they plan to serve 40% of u.s. households by year end with

online grocery ordering and same day delivery they'll use uber and other methods to get it to you they'll add other partners on the way. the order needs to be at least $30. there's a $9.95 delivery fee but no membership. a thousand stores will be added by year end. a lot to talk about in the world of retail. when it comes to grocery delivery, that war is heating up, but it is a difficult game to play, especially here in the u.s. there's a number of issues, not the least of which we're less dense than other areas in europe that have done online ordering and delivery more successfully walmart is one of the companies that can leverage learning in the u.s. because they offer them successfully overseas. we talk about amazon, but they've struggled here amazon fresh got folded into prime. they're offering some delivery

from whole foods, andthey're trying to figure it out. >> retail sales number overall, on-going weakness in auto dealers and furniture and department stores. >> and this is interesting i want to look more into this on a grand scale over time. a lot of retail executives i talk to don't put a lot of credence into that monthly number home depot cfo says i don't look at it, numbers don't correlate when you see what's happening there. they're the biggest home improvement retailer something to consider as we look through it there's month to month numbers, and talk about retail, often talk about year over year. >> all right united airlines under fire after the death of a pet on one of its flights contessa brewer joins us with the latest. >> jon, this is getting a lot of attention. the family boarding flies from houston to new york. mom juggling two month old baby,

older daughter and the dog the family says the bulldog was in a pet carrier designed to be placed under the seat in front of you on the plane. >> we sat down, trying to put him under because he fits. the flight attendant says you can't put him there, he will block the path you have to put him in the baggage. she helped my mom put it up there and closed it like a bag >> they told the flight attendant the dog was in the carrier. other passengers report hearing the dog barking in the bin by the time the plane landed, the dog was dead >> it is horrible now, now i'm thinking about hearing that dog and not knowing that it was needing help >> united accepted full responsibility refunding cost of the ticket and fee paid for the dog to travel the airline says it was a tragic

accident that should never have occurred, pets should never be placed in the overhead bin other incidents put united in a negative spotlight remember the dragging of the kentucky doctor off an overbooked plane, for one. united renewed focus on customer service, sending employees to compassion training. but the history with pets is getting attention. they have 75% of the animal death on commercial flights in the last year, according to report by the dot. 18 of 24 animals died in and on flights were on united carl >> quite a story, contewe look forward to hearing more specifics of the case. pretty interesting normally at this time we bring you european close because of daylight saving time, it will happen during half time. here's how the major averages stand. keep your eye on the uk. prime minister may made some

remarkable comments regarding the russians. when we come back, former apple ceo john scully joinls us as te resqwk- inus mo "ua alley" straight ahead.

we just got married. we're all under one roof now. congratulations. thank you. how many kids? my two. his three. along with two dogs and jake, our new parrot. that is quite the family. quite a lot of colleges to pay for though. a lot of colleges. you get any financial advice? yeah, but i'm pretty sure it's the same plan they sold me before. well your situation's totally changed now. right, right. how 'bout a plan that works for 5 kids, 2 dogs and jake over here? that would be great. that would be great. that okay with you, jake? get a portfolio that works for you now and as your needs change from td ameritrade investment management. from td ameritrade and i am a senior public safety my namspecialist 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. good morning i am sue herrera here's your cnbc update. thousands of students across the nation walking out of school to demand action on gun violence.

outside the white house students carried signs and chanted. they were urged to leave class for 17 minutes one minute for each victim of the attacks at the marjory stoneman douglas high school in florida. ford is recalling nearly 1.4 million mid size cars in north america because the steering wheel can come loose. the recall covers ford fusion and lincoln mkz cars from the 2014 to 2018 model years. overseas, angela merkel sworn in for a fourth term as german chancellor, putting an end to six months of political uncertainty in europe's biggest economy. lawmakers voted 364-315 to reelect merkel, following long coalition building efforts. and residents began cleaning up and utilities started restoring power to thousands without electricity in new england, after the third nor'easter in 11 days slammed into the region with more than two feet of snow in some areas let's hope that's the last of

the snow that's the news update this hour back downtown to "squawk alley." carl, back to you. >> sue, thanks so much. the president eyeing a tariff up to $60 billion on chinese exports, john scully, chief marketing officer of rx advanced, former ceo of apple. john, good to have you back. >> thank you, carl. >> if you're in the international operation office, could be apple, skyworks, any of these companies that have a high percentage of revenue coming from china, what's being said today? >> i think you have to put it into the context that china has a debt to gnp ratio, we have half that, 71% i don't think it is in china's interest to get into a trade war with the u.s., so i would be skeptical whether we're going to have a trade war i think the steel issue is

relatively small when you look at it in the context of the importance of trade for china. >> so you think it ends here ends with steel and aluminum >> not necessarily i think that we shouldn't overkpak raove overexaggerate this is new territory. for the last several decades have been focused on globalism, now protectionism. doesn't mean we're going to see radical shift overnight between china and the u.s. >> to the degree we see change on the margin, john, do you think it is going to be based, going to be on trade, free flow of goods and hence shaving off earnings at the margin or is it more about due diligence and m and a getting complicated, lobbying efforts getting more intense? >> clearly m and a will get more

complicated. the national security rationale as to why kwaul calm, broadcom deal was turned down by the president, in the case there are issues other than economics involved, particularly with intellectual property, particularly with china, so it is a complex world out there i don't think we can oversimplify and say it will be one thing that will be the focus how we have to look at global trade. >> john, to what degree does it matter how much companies have invested on the ground in a country like china when it comes to these inflamed trade tensions i know you are invested in a smart phone company that was pushing into india, and india had concerns about being sure there was domestic production and domestic support behind that does that provide companies with a bit of a buffer or cushion to trade wars if they invested on the ground >> absolutely, and india

particularly wants to see investment on the ground they want to see jobs, capital investment, want to see things that are going to help increase infrastructure i think that's a very good example. but both india and china are having exceptionally good growth now. china reported it has 7.2% growth in gdp this year. i think the outlook for emerging markets, particularly the two largest, is positive, and i think they're definitely going to look for investments on the ground very much a part of what the game is. >> john, apple market cap is getting closer to a trillion dollars, talked about it earlier in the show. if you're tim cook, does that substantially raise the bar for what you need to do to bring forward growth after last quarter's fairly disappointing iphone shipment number do they deserve a trillion

dollar market cap? >> apple has done a beautiful job positioning themselves as a company that everyone knows what they stand for they're really a luxury, modern luxury brand, and they learned how to make money doing it and continue to grow i think apple is trying to expand on its iphone ecosystem so it isn't just the iphone sales. yes, iphone sales have been disappointing, particularly for iphone x, but apple was clear when they first introduced that they were introducing a suite of products and more are coming apple is trying to play a different strategy in terms of how they manage the iphone franchise. and we're early in the refresh cycle for the iphone >> john, thanks for that your point about it being a more complex world, every day, well taken. see you next time. john scully joining us today. dow, all markets have taken a spill.

dow is down 270. s & p down 16. boeing now down 4%, and the s & p has once again come back to its 50 day might see technical selling on that make more sense of this in a moment getting brneaking news out f washington >> senator rand paul coming out against mike pompeo for secretary of state and gina haskell for cia director the reason he says is both nominees supported water boarding as acceptable form of interrogation. rand paul instead called it torture. he said the state department is about diplomacy, not war and mike pompeo is unapologetic about the invasion of iraq senator paul sits on the foreign relations committee which will have to vote in favor of pompeo for secretary of state republicans only have a one seat

majority on that committee, so paul's opposition means pompeo will need democratic support to make it out of committee republicans also have a narrow margin on the senate floor right now they have 51 votes once ed cochran of mississippi resigns, then they have 49 unclear if republicans can pass it on party line vote. clearly the politics of this will be messy. back to you. >> never a dull moment for you in washington. thanks for keeping an eye on that important story. still ahead. netflix under fair for unfair y nfor stars of "the crown. stay with us your letting go thing. your sorry not sorry thing. your out with the old in with the new, onto bigger and better thing.

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coming up top of the hour, the latest on the selloff. why stocks accelerate to the down side. is the run in technology over or in danger of coming to an end. top fund manager tells us. and a look at morgan stanley fresh money favorites. the names the firm says deserve your dollars now all coming up top of the hour. see you in about 15. >> scott, thank you very much. let's get to santelli exchange good morning, rick >> good morning.

welcome peter bookfar. thanks for joining us. >> great to be here, rick. >> tell you what, i think i personally feel you can learn a lot by today's dual numbers, competing two directions pp sich ppi, we will get to specifics in a minute, it was lukewarm, certain parts maybe hotter than that, but retail sales was deplorable and look year to date, you can go into that in a second, flattening >> the ppi reflected price pressures with respect to commodities. certainly transportation, finding a truck to deliver goods has gotten more difficult. i think supply constraints that i see causing pressures. the question is when does it spill into consumer prices saw yesterday, cpi sticky at 2%. retail sales frustratingly

mediocre for the third straight month. retail sales below where they were in november at the core level. i don't know if that's consumers trying to save again after savings fall to ten year low or paying down debt after a debt binge at the end of last year, maybe didn't get a tax refund, waiting tosee the tax cuts filter in. i don't know, it was mind boggling to see retail sales numbers. i see inflationary pressures, and retail sales bringing down the long end, causing a flattening today. >> i love when we're in synch. this is important. the long end, everybody thought would for sure be the steep ening side of the curve that would accelerate over short rate because of the growth spurt and it is not happening that way then the shortened is paying more attention to wholesale inflation. we see the break evens that are proactive on the 10 side versus tip side

we dip down, show a chart of that do you think it is that simple, that retail sales being weak has given clues that flattening and long end not going to 3% has more to do with the weaker growth than the average to slightly above average pace of inflation? >> i think so. you look at economic growth, with all of the enthusiasm engendered by tax reform and leg tree relief, gdp may be 2% at the same time, inflation and wage pressure that i am seeing is forcing the fed to do the three times, everyone questioning whether they should go a fourth time shortened is acknowledging the fed is on a path that they're not going to walk away from, while the long end continues to struggle with yeah, we expect growth to pick up, but it's not. we have all of this supply, how do we digest it. that's where we're seeing a bout of flattening. some steepening, and now growth

not accelerating to the extent people wanted. >> i love that summary just about out of time for me, it speaks volumes about the notion that the long end would be driven solely by the inflation front. don't see that inflation forming. thank you, peter bookfar courtney, back to you. >> thank you very much when we come back, free ridesharing by 2021? that's a goal of the company stay with us

welcome back to "squawk alley. the dow jones industrial average is down about a percent, 257 points, falling just in the last several minutes or so. we want to draw your attention to that. but vugo is a startup looking to make ride-sharing free by 2021 with a recent court case win in new york, it's one step closer joining us is co-founder and ceo. for those of us who aren't necessarily familiar, give us your thesis. how are you going to make ride-sharing free by 2021? >> yeah, it is just a few years aw away it is a passenger centric info team and solution. we place digital media, interactive content, premium services and content, advertisements, things like that in ride-share vehicles and other vehicles

for us once we move away from ride-share to autonomous vehicles, the cost drops low enough that we can actually monetize above that threshold to operate those vehicles so we think we could actually make it free. >> so that assumes we'll have enough autonomous vehicles in three years to make this worth it too that's another big jump. >> correct. >> i understand that you think that retailers are some of those that will willingly pay for this content to cover the cost of a ride if you're in an uber, which could be the case in new york city, since you won that court battle why would retailers pay for my ride to macy's. >> if you're a retailer and can engage with a passenger while they're en route to a purchasing location, that is a really good time to engage with them about 75% of all vehicle-based trips today end at a point of sale today ride share is only 0.1 of 1% of all vehicle-based trips. with autonomous vehicles as we drive that up towards 50%, 60%, it becomes really enticing for

retailers. >> here's the problem. i don't want to watch ads sitting in the back of the car in order for this to be free won't i have to tell advertisers, who i am, where i'm leaving from, where i'm going to and maybe more information that i don't necessarily want to give up. >> yeah, that's certainly the caveat on the whole thing. we think that a lot of people would be willing to give up some information about where they're going and things like that in order to make the trip free or at least a lower cost. certainly there's people who are not going to want to do that but we think there will be enough to make it compelling. >> how adept will regulators be at keeping up with this kind of change >> well, so far in the u.s. market it's not a problem for us obviously we just won a big lawsuit against new york city. new york originally had a ban of in-vehicle advertising in ride-share vehicles. they basically said it's okay to do this in taxicabs but not in ride shares. as we challenge them on a first amendment basis saying it is okay, we've been pretty successful. >> uber had to do that city after city after city.

>> yeah. >> with a pretty intense culture. can you replicate that >> that's the plan so in new york we are launching here in the next couple weeks with about a thousand vehicles we are expecting to get to about 10,000 or so vehicles by the end of the year in new york city we are doing a similar challenge to chicago's ban they have a ban of in-vehicle advertising for ride shares but we're working in a lot of international 345urk9markets. we have partners in southeast asia, mexico >> but in order for this to work the drivers themselves have to purchase the technology. >> correct. >> and they're okay because they see a benefit? >> drivers make about $100 to $200 per month using our platform and that's for incremental work they're already doing. there's really nothing more they have to do other than install a tablet in the back of the car. it's only about $100 to $125 >> uber has services where

multiple people get into the car. how can the advertiser tell who the high value person or people are in the car they're actually targeting? >> yeah, for us obviously the more people in the car the more complicated it gets. we can't target ads specifically as we otherwise could have if it's an individual passenger in the car. but for shared models, the actual cost per mile goes down quite a bit also so that helps our mission to make transportation free. >> it's a very interesting concept. i'm sure we'll follow it along as we follow this industry isn't general very closely thanks for joining us. >> thank you. as we go to break, take a look at the dow, down a full percent. boeing shaving about 100 points off the index. boeing, by way, not only broke the 50-day this morning, on pace for its worst day in about a month, but boeing is down 10% for the month to date and that's causing some pain here back in a numite

netflix under fire as fans discover pay disparities on the hit show "the crown. claire foy took home a smaller salary than matt smith who plays her husband, philip. the show's producers pointed to smith's can the dr. who" fame but the creative director

suzanne mackey said going forward no one gets paid more than the queen they will recast foy's character as they move the show forward by decades. anybody who's seen the show, it's kind of like, what? >> it's mind blowing i just looked it up to make sure she did win the golden globe for best actress in a tv drama in 2017, naominated in 20 ape18 who looks at these someone has to have knowledge of both of their pay and thought, hmm, that makes sense. >> the only upside is that netflix copped to it publicly and said that it remedied in the forward. >> going forward. >> you'd think they would be ahead of something like this. can't ignore the market action today the dow now down 290, session lows a little more than a percent. s&p did get back to the 50-day which did raise some concerns.

you've got some gdp estimates getting trimmed. retail sales did worry some. trade worries intensify and then you've got additionally just concerns about the ten-year and 280. >> some industrial names pulling down boeing down almost 5% and johnson controls down almost 3% too. >> lets get to the judge all right, welcome to "the halftime report. i'm scott wapner we do begin with a sell-off in stocks as fears of a trade war with china continue to ripple through global markets with us for the hour today, jim laichb thaul, jon and pete najarian kevin o'leary, the chairman of otf. and we begin with stocks under pressure industrials, techs, financials pete, tell me what's going on. inflation a little hot, retail a bit weak real worries about a trade war and escalating one with chin