nasdaq down by 29 points we started off relatively flat. >> you get the wobble in apple and the relative 2.9 >> look, the markets -- >> nothing at 8:30 happened, right? >> the yield went up and now it look attractive relative to the yield on the s&p 500 make sure you join us tomorrow right now it's time for "squawk on the street. ♪ ♪ good thursday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber rising yield, inflation expectations and commodity costs are once again in focus along with earnings from mx and proctor. the uk is up a percent and attention is on the ten-year and cracking the 2-9 and that does match the highest levels since

february, and 100 million strong and that's the number of amazon prime members subscribing to the e-commerce giant globally. shares are up, pre-market. >> the president intensifying trade talks with japan and threatening to walk out on kim jong-un if north korean talks aren't fruitful. >> investors watching corporate ea earnings and amex. amazon prime service now has more than 100 million members. jeff bezos announced that milestone in the annual letter to shareholders. its publicly disclosed the shipping and $99 a year along with other benefits. depending on how you count, members and multiple members and families, more than costco has members at 100 million >> cutting your netflix. the letter was actually a thing

of beauty and it starts off about how to write a good memo and what it means to be rigorous and intense and it sneaks in prime, but it's remarkable and everyone should read it because it's really a triumph of ingenuity and it is -- look, this thing is so loved that literally, after i read this i said please raise it i want to preserve it. make sure you continue to get free delivery by charging me $120 for this. >> talks about how they don't do powerpoint at amazon and it has to be written in a narrative and you have to think more >> six pages how about when you said so far so good. does he just do an al capone thing when he just doesn't like the memo, you know, and the circle >> i remember the circle with the baseball bat. >> yeah. it speaks awfully like louis will have slugger. >> now the questions, jim about

whether or not this portends more transparency out of amazon. we've been looking for numbers like those analysts have been guessing for a long time >> one of the things >> today is such a negative day that the first thing i heard from two different people is a-ha now we know a number so they could disappoint now that they've given us some clarity we'll find out that it's not going to be able to grow >> he said about something about reed hastings and netflix when it was around 25. >> do you know why they would give us more clarity at one point i said to myself, there is a guy at, what? you have an address in washington, and big house, and it seems like his packages like mine are being stolen? >> you think there is a political aspect to it >> even though there is no mention of anything political. >> the washington post -- it makes me feel even more that it's just the washington post. these are potentially 100

million voters >> a lot of voters get this. this would be -- a lot of voters have amazon prime. i believe that's true. i don't know the overlap maybe they'll present that to us next time and how many amazon prime account holders vote that would be interesting. >> bezos' picture at the top of drudge today it is a comment on the overlay between -- i think there are enough people that say, you can take this away from the nra and pry it away from the cold, dead hands. people love crime. thanks for nothing remember, that was the best day ever, guys remember we got that this was one of those where we said he's so much smarter than i am and it drives me crazy and you may be smarter than b

benihoff thwart it, but don't tell anyone that he's smarter than i am because he is. >> what does that mean for fang, jim, and amazon, as we know back above 1500 the good thing about fang, we always knew it's not about china. so you have this group of stocks and netflix is not in china and it's a joint venture and cambridge analytica there, but still, google which was not in china by choice and amazon, what can i say? netflix, this fang is anti-china, it's immune versus what we will hear, no doubt from david, a substantial shot across the bow with nxp >> you can make an argument, jim, that the comments about the nxp potential approval are having an impact on the broader market because that's how significant it would be if, in

fact, they did choose to reject qualcomm's against nxp, giving you almost always approval from the antitrust authorities. we get cited for the reasons being down you can add that >> that and tsmc says cell phones are weak and this mizuho note which says it's not just the ten. it's the 88-plus the problem with that is when the stock was 157, and i was here all about the tending week. >> and i don't know anyone who has integrated the notion and this is one of those holds that is a slz, so to speak and there's foe, foe, foe. >> four, four, four.

that was moses malone. >> fang, fang, fang. what's priced less does amazon have at that $99 level i know you've talked about netflix and you said they could raise. do you think they could go higher, too? >> i really do when you deal with companies that are not amazon, this same day and one day and -- it's killing them they don't have the scale. so i think it's killing so many on not the bond toms and bye-bye and cnbc.com is great not active and they're closing. >> the number of square feet that have been shut so far this year matches all of 16 was almost like last year. >> i used to shop at doylestown. >> most street retailers don't have a cloud business. >> you could easily raise the price. amazon web services is the real grower here. amazon web services, and i know

that they went to the president and talked about how bad it would be, but the department of defense once i think this hard wired amazon services and they don't want the others. so i just think it's a situation and they talk about being a handstand and you can't learn it in two weeks and it takes six months and i was thinking the other guys are all trying to do hand stands and he's got the handstand down >> speaking of the president, mr. trump and japanese prime minister shinzo abe have intensified trade talks. last night the president reaffirmed his bilaterals aimed at trade imbalances with japan >> we are doing 232 on steel and aluminum, and if we can come to an arrangement on a new deal between the united states and japan that would certainly be something we would discuss, aluminum tariffs and steel

tariffs and i would like to at some point in the future take them off >> now we got to david's earlier point. you have technology in the crosshairs of some trade discussions. these sanctions, we know what it's doing to aluminum stockpiles are starting to pile up in russia. >> boy, i'll tell you, the alcoa conference call last night was just a ball of confusion they talked about where the prices are coming up for aluminum, but the main theme, by the way, was that china is cutting back on aluminum and not because of the restrictions and because of the quality there because aluminum is probably like having a coal plant right next to you because it is just so intensively pollution and that's what seems to be pulling it back, so it's funny to see the president saber rattling on aluminum and the countries that make aluminum. it had been china that was the enemy and they're self-inflicted and the russia, and the sanction, but when i say ball of

confusion and at no point does the management in alcoa say listen, it is the tariffs causing us to make a lot of money. >> it's interesting that you brought the chinese anti-mrugz efforts are figuring into this >> you die of respiratory. >> it's a huge issue we're moving in a different direction when it comes to the environment and they're finally taking up the case >> each channeled 500,000 patients each and they're seeing a lot of -- >> i've been there and if the air pollution is what everybody talks about when you get to the hotel. if you walk outside. >> very difficult to be outside all day. >> it's incredible >> you've been there a number of times. it's bad on tariffs,though. i think the times counted the number of references to tariffs in the beige book yesterday. 32 32 references to tariffs

worries about price increases, supply shortages and supply chains i mean, this isn't all of the survey data we've gotten over the last month or two. >> nucor just reported and they missed the earnings estimate and they did a pretty good job on the revenues and the stock's trading up in the pre-market they're the biggest beneficiary in the sense that the president's leveled the playing field, but when i sat down with one of the major auto company, you say it's just a couple hundred buck, but those guys are struggling to make everything. so you're going to hear this, and you're going to hear caterpillar. to some degree it's grousing because the price of steel has kept down art fshlificially by e chinese. the tariffs are wreaking havoc with this quarter's earnings >> when we come back, david's got the latest on disney and fox. what a day in the media news >> m & a overall, we have a lot of good stuff. >> christine lagarde at the

spring meeting in washington just made comments about how the corporate tax is one of the things that the white house has done correctly sarah eisen will sit down with you to discuss trade war risks and global trade and a lot more. s&p is shooting for the fourth day up and hasn't done that in a couple of months, but the futures are working against it we're back in a minute. >> the four tech names are fang. fang yeah, fang for short these exemplify the characteristics that the stocks are moving what's fang? facebook, amazon, netflix and google

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welcome back last night we got the long-awaited proxy detiling all of the goings on including the all-important background of the transaction between disney and fox that led to that deal that we covered so closely months ago in terms of disney buying so many of the fox assets that deal still under way, still some time until it closes and regulatory review under way and yet to conclude, certainly, but we got some interesting insight, frankly into things we have reported, but perhaps in the craziness of the days following the deal announcement. some people missed certain things we got confirmation of them. namely that our parent company, and our beloved parent company are competing for the fox assets

in question and having entered the fray once we reported on the talks with disney and fox november 6th of last year and as others had reported, as well, the comcast bid was above that of disney. however, to be fair, they were not apples to apples, and it was made clear, as well, guys in the background of the transaction. some of the key areas of difference and why the fox board, as i had reported on that very day they announced the deal was resistant to comcast a lot of it came down to deal protections and regulatory review for example, disney was willing to offer $2.5 million break fee. comcast no break fee whatsoever and more importantly, those regional sports networks, 22 of them that disney was buying. there's an anti-trust risk and there is belief for comcast and there would have been a need to

put those back to the new fox and there was a belief that there would have been a lot of them put back and so it's not really the $34 and change that they're talking about. it is less because the ebitda involved that would be going back to new fox, which by the way, they'd be paying taxes on receiving no premium on those assets and that takes the overall number down. so when you add up the putback provisions, their unwillingness to let them pay a dividend for a period before close, no reverse break fee, you get a sense, guys, as to why the board of fox, for any number of reasons and rupert murdoch, of course, did not feel that the comcast offer was sufficient to address that regulatory risk. >> interesting >> how much of it might have been between bob iger and murdoch? >> listen, that always is

important, but i will say this because why is this still important? well, we talk often about the at&t/time warner trial and it goes the way many people believe given the arguments that have been put forward in that court and the judge says no, government, you cannot stop this deal and it is certainly possible comcast will try to come up again to compete with the fox assets with a bid because it would feel like it has the regulatory clearance it would need, but if it does so, it would still need to meet these regulatory concerns. if they do, though, on an apples to apples basis come with the higher offer with the deal protection sought and then rupert murdoch may view it differently and the board may view it differently. it's possible. >> dave, i know you will talk about later about nxp and how important that is, there just seems to be around the world new nationalism when it comes to antitrust and i know there are issues with rupert in london is there a chance this could be

killed by anger and spite over in europe? >> i don't believe so. >> okay. good >> remember, comcast is competing to purchase 39% of sky that is not already owned by fox. they also have a bid out there that is lower. comcast has yet to make that an official bid from a 240 or the uk takeover law, but they will soon most likely early may is what i'm hearing. so you have all these different potential areas of competition, but that's the one where they are still competing and the question will be do they come back and will they improve on what we know everything about in terms of the last offer they made which was higher, and how can comcast stock go up in this environment? >> you tell me you tell me. the stocks started to go down when they made the bid for disney to go public. the stock continued to go down when they made the bid for sky when is it going to see some relief >> i don't know.

there's this tremendous and let's get it over with, please the relief will be if they lose, i guess and start buying back a lot of stock >> well, listen, if time warner and at&t goes the way many people think it will and we'll see what judge leon says maybe comcast can buy something else, too. they can buy another cable company. i've got a couple in mind. >> when we swing we tend to swing hard. >> we do when we come back, cramer's mad dash at the opening bell and we'll take a look at the market as they're lower and the ten-year, 2.91 the highest since march 21st when it hit 2.96. back in a minute imagine traveling hassle-free with your golf clubs.

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♪ ♪ all right. time for a mad dash on this thursday a lot going on with procter & gamble including earnings. >> yes let's call them mad dashes, all right. because on the earnings, organic only up one. david taylor says we delivered modest pop and bottom line growth in a challenging macro environment. remember when procter & gamble was immune to the environment. i just got my dollar shave club. it will be shipping today.

this shave care, organic decreased low single digits primarily due to pricing reductions david, this is the gillette promise. it's too expensive. >> and it has been, trying to get it out of the darn case when you have to have someone come over and unlock it for you. >> some person to open that case. >> not a good thing. >> overall, nelson peltz on the board. the first board meeting took place an hour ago. i don't know, do you think he makes a difference here? tell me about the german merck deal >> european's -- >> europe's merck. interesting because a few weeks ago i reported they were the lone surviving bidder although the price differential was enormous for pfizer's much larger consumer unit and pfizer wanting as much as $20 billion and p & g not near that price and that is not going to happen and i don't know what pfizer is going to do with that unit

all of the bidders are gone. >> i guess -- but p & g does that's a sizeable acquisition. >> unilever which a quarter of the people didn't like, but much better growth. >> the journal writes the story of nobody getting pricing power and everybody facing inability to raise prices. >> bad businesses in the supermarket and the drugstores bad. >> all right when we come back, we'll talk more about nxp and qualcomm. we will talk about takata's bid for shyer and if managing director christine lagarde >> am the guard.

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>> there's huge aims of money to be made by the stocks selling off bank of america. j.p. morgan and wells fargo, but i have to tell you, when you go over the american express conference call they're talking about initially being a headwind and that's important because american express had a terrific number talking about consumer spend. when you listened to that call rates should be higher and that's how good that call was. >> the other issue is why the transports have behaved okay in the face of crude that has cracked 69 today >> isn't that something? i know the rails led that move and they're not that sensitive and you get 400 miles to the gallon from those guys >> when you take capacity out or don't add as many planes as we thought, look at the package number for amazon. so great for fedex and so great for united parcel. >> interesting to watch southwest rally yesterday even in the wake of that accident. >> gary kelly did his best, but

salute that pilot. what a story we talked about her all night. what a great story >> unbelievable. front page of "the washington post," a profile of the southwest pilot. >> there is the s&p at the bottom of the screen at the big board, it was tech international celebrating its ipo and a maker of graphite electrodes used in steel production at the nasdaq it's morphosis, a biopharmaceutical company company. proctor and the pricing weakness, q1 sales is not as much as unilever put together. the outgoing ceo of unileaver and all of the lines there were very, very strong. no one likes them even though it seems that i was the fair-haired child because there was so much emerging market and the emerging market for unilever was

fabulous proctor, what can i say? they have lines down very big, versus every line at unilever. unilever has been a hot one and to go back to the rate hike thing, the bulls today need to see bank leadership because she's consumer product stories, clorox downgraded and people saying the valuation stretch there. clorox did not make the number last time, and it is so hard and campbell's soup just miserable, miserable, and i struggle other than conagra to find something in that supermarket aisle that is doing well. >> it's the first wave inflation they're facing and the pass-through is difficult to put through, right steel and aluminum. >> yeah, and by the way. i don't know, we stopped going to the drugstore and we do amazon prime, most for anything that is these kinds of soft goods and the diaper line for

proctor looked terrible. >> i get my cereal delivered by amazon and the giant boxes of sugared cereal and my kids love it it's great i didn't buy pop tarts >> i use the best granola in the world. >> carl's -- really? >> yes the best granola in the world. we're ready, by the way. i don't know what my prime is, but we're ready. >> thanks for letting me on. >> you like that captain crunch. >> amex is down 2.7% and it is having a broader impact, perhaps on the market. it's just another sign of increased tensions between china and our country and china when it comes to trade. if you are just hearing there was a spokesman for the antitrust authorities known as mofcom in china who said that there are problems with

qualcomm's potential acquisition of nxp that would be difficult to overcome and more importantly, this was news to qualcomm, i would add, raised the potential for conditions that they were not aware of. in other words -- remedies, i should say remedies that were not good enough as of yet that was new to qualcomm and the possibilities that the remedies they'd offered for this antitrust review might not be good enough. it's gotten wrapped up, of course, in the overall rhetoric between our two countries and in the increased tensions over technology in particular nxp and qualcomm have extended their merger agreement, not 60, 90 day, and it will be be paid at the end of that if there is no mofcom approval and that's what we've got, jim, this waiting game where qualcomm is

left wondering what remedies do we need to make beyond what we've done others say it is not a rational response from the chinese to do this why not allow them to get their pound of flesh, to allow this deal to occur? it sends a terrible message overall and would have a certainly significantly, negative effect on the ability to do large technology deals if, in fact, we were to say they won't approve any of them. yesterday i went over the october 27, 2016 conference call when the two companies announced the merger no issues whatsoever with antitrust. why? because there was no overlap and it was qualcomm's opportunity, a brilliant one to get into auto because nxp is the economist drive and it is also cruise control. you love this deal which qualcomm didn't really have. you love this deal because qualcomm is getting out of the clutches of apple and now

qualcomm goes lower and makes sense. by the way, it would have been enough just to have tsmc to have skyworks down today and not so much nvidia, but people turned on nvidia and it is a good day for the group. >> qualcomm shareholders may wonder about what might have been if cfius might not have intervened 127.50 >> nxp is a 127 -- >> oh, my god! you would have gotten north of 80, what was it? $27 million? what a disaster. they invited that cfius review guys, i want to move on to the other key m and a stories and one of shire and the large uk-based pharmaceutical company, very focused on -- on the rare disease franchise that they have there, somewhat similar to

biomarin takata had been outed as a potenti potential bidder and then you're force to go into the entire process. we got it, and it was rejected it was 1775 in cash and i am talking here, by the way, in pounds and that's 62% stock, 38% cash that was always thought to be one of the problems here is there are not a lot of shareholders in shire who want to hold a lot of thakeda shares and if you have more liquidity there might be a willingness to accept a large deal of stock, and they can't get enough to get there and so that's a problem. i want to add, there are at least one, if not two other bidders out there for shire. >> really? >> yes i don't know who they are, and i know, though, speaking to people

who represent them that they exist, one of them, at least, thought to be large, pharmaceutical companies they want dialogue quiet dialogue >> it may be up 5% >> we have two more things to do, but apparently, zee to get to sarah and i'll come back to cbs and via com in a little bit. >> we'll have time for that. the imf and the world bank are holding the meeting in d.c. and sarah is there with christine lagarde. hi, sarah. >> good morning. madam lagarde, nice to have you here >> lovely to have you. good morning. >> good morning. you put out a rosy picture this week of the global economy one question everyone is wondering, though, is this the peak is that how you're thinking about it >> we're thinking about an upswing and the upswing because we see good growth, solid 3.9% this year, and 3.9% forecast next year and what is interesting is that we're seeing

being fueled by more engines than we had before so we're seeing investment up in many corners of the world and we've seen trade picking up even more so than the 3.9%. so the upswing which needs to be sustained because we don't want to go back to these mediocre rates that we had a couple of years ago and to do that, clearly government and approximately see makers have to implement reforms. >> that's been the key message >> my key message has been sun is shining, we have growth >> don't miss the recovery in terms of reforms >> on the arkets, we've seen global stocks higher on the coordinated growth theme, but lately a little more volatility. how do you read that >> well, if i translate that into our own analysis, we're seeing looming clouds on the horizon and probably more so than we did six months ago and that has to do with first of all, the fact that some governments have been lagging

behind and not doing the reforms they should do now and we're seeing a big mountain of debt. 164 trillion debt. 229% of gdp is a big number. two-thirds of that is in the private sector and we see high leverage in many corners of the world. advanced economies and public debt is at its highest since the second world war and what is worrying also, although it's not a big number, but in terms of debt service, it is big. we're seeing low-income countries that are overburdened with debt and that's -- that's a big cloud. no one of the clouds that's been much talked about has been also the lack of international cooperation to address the trade issues, the trade concerns that governments have including in this country, but also in other places around the world. >> yeah. clearly, this is worrisome for the imf which stands for free trade and open trade and coordination so based on what you're hearing

from the administration and china and in the news, are you disturbed about what you hear and see? >> what i would certainly prefer is a very determined effort to address issues there we have protections on the rise for the last three years there are issues about intellectual property. there are issues about subsidies to state-owned enterprises, and those have to be debated they have to be discussed so that there is free trade, so that, you know, free market economies as well as others can operate according to the same rules. what i am concerned about is that this be debated in a multilateral setting with everybody involved because at the end of the day, you know, enterprises, companies, corporates, they operate on a cross-border basis they know no boundaries and they have a supply chain on a

completely multilateral basis and so all countries have to be at the table to address those issues we know from history that unilateral barriers, measures, tariffs decided unilaterally are not particularly effective. >> prime minister abe this morning, the news is that they'll work through a bilateral trade deal which is what president trump prefers versus tpp which it seems he was reconsidering, but not so much anymore. is that a mistake? >> you know, what promotes free trade, fair trade, two-way street trade is always good, but we know that the best way to optimize it in the interest of all, not in the interest of one, is to have a multilateral setting and that was the beauty of the post-world war institutions and framework within which so many countries developed around the world so many poor people were taken out of poverty so many of us benefited from

consumer goods at rock bottom prices >> but the administration would say that wto it not working for us china has had these barriers and previous administrations have tried and nothing has gotten done do you believe these tactics can work and the chinese goods >> i think there is an issue of trust that needs to be preserved and when operators and investors and companies are uncertain about terms and conditions under which to organize their supply and chain, terms and condition under which they're going to trade, types of tariffs that they're going have to pay. they step back and they don't invest they delay they wait. so to, you know, brutally change the course of things without having tried vehemently, directly, forcefully within the multilateral setting to improve the position, i think, is not the most conducive and effective

produce for activity. >> should they boycott american goods in china >> i am not sure this is high on their mind what is probably high on their mind is how do we organize our supply chain where do our parts come from where do we set up the assembly line and the intellectual property those are the questions they have in mind. >> do you expect the u.s. and china to work this out you were in china when this was going on and how do you see about how to have the deal with trump? >> on both sides g negotiations whether it's between two parties or with multilateral operators, everybody operates in their own interest, and they will try to optimize their position, but they have to take into account the current situation of the world, the supply chains that exist, the benefits for consumer and they have to take into account time, as well. what might seem leike a

short-term gain might be a loss. >> i remember in boston a few months ago you want to see tax reform that is not going to blow a hole in the deficit and what we've got is we will return to trillion dollar deficits as a result of this tax cut >> you know, we have supported, encouraged and strongly support of the corporate tax reform that has taken place. it's a major improvement and it's good. at the same time we are concerned about the deficit. we are concerned about the debt of the united states and we than because of aging, because of entitlement, these will come to haunt the american economy and the american people. so we're saying there is an upswing now. growth is up take the right growth-friendly, fiscal measure, measures that will help consolidate and leave

our rate. >> nobody's talking about conservatism and that is not en vogue with republicans these days >> i think it is worthy of consideration because we're not just short term. we have children grown children do we want to shift the burden on them and the higher burden than before? i don't think certainly that's not good economic proposals. >> all right you've certainly been warning about that i know you look at bank regulations. what about technology regulations? do you think we're about to see a wave of increased scrutiny, obviously we've seen scrutiny, but revelations when it comes to tech globally and revelations into their competitiveness, and companies like facebook, google and amazon >> as you said in the imf, we support free market. we support competition we support improved productivity we support innovation, and we know for a fact that when there is too much market concentration

in the hands of too few, weir not seeing competition we're not seeing innovation, and over time we are seeing, you know, gradual -- >> is that when facebook is? >> it depends how you define the market it depends who substitutes it's a very complicated debate. >> you're not going to call anyone out. >> actually, determine whether or not there is that level of access to market, and whether or not the accumulation of that data in the hands of a few is not going to be such a barrier that other entrepreneurs simply cannot access. so the situation is very different from what it was in the telecom age or in the gilded age. we need to really re-think the way in which that situation is addressed and competition is encouraged and if that requires a new set of rules taking into account the intangiblity of those assets it needs to be done look at tax, for instance. it's one in which all

policymakers around the world need to look at where is value located? where is value generated how should it be taxed and what revenue should be contributed by those players? >> i know that is one of the big themes of discussion here at the imworld bank meetings. thank you. for sitting down with us and a first with cnbc, christine lagarde, director of the imf i left it there because i know you're talking about this with amazon surpassing 100 million consumers and all sorts of other tech stories in the news we'll send it back to you. >> sarah, as always, thanks for bringing madam lagarde and we'll get your reflections on the interview in just a little bit >> watching the markets down 92 and starbucks is the other big story today. we've seen kevin johnson go on some of the morning shows and now the two gentlemen who were arrested at this philadelphia location were on "good morning america" this morning. take a listen. >> so when they do approach you, what do you say and how do you react? >> well, initially, as soon as they approached us they said we

have to leave. there was no question of, was there a problem here between you guys and the manager no what happened >> when you were arrested, did they tell you what you were being arrested for >> no. not at the time. he wasn't read any rights. double locked, handcuffs on our back and escort out and put into a squad car. >> so they were there for a real estate meeting that they thought would change their lives and jim stock wasn't necessarily buffetted by this episode. >> i think we have to see the quarter comes next week. i think they're doing everything right. it's really a question of this is a china story people don't expect that much out of the u.s. anymore and kevin and howard are very much involved in trying to explain, closing the store, but i've got to tell you that when christine lagarde, when sarah asked her

about china and apple, say, i've been worried about china and starbucks just because if they're worried about the nxp deal where there is no overlap geez come on! you could hit a company where it really hurts. >> you're right. it's worrisome on a number of fronts that the mofcom is holding things up certainly and they have 90 more days on qualcomm and nxp i do want to get to an update on cbs and via com. it's been over a week since we've had anything to say. the two companies continue to -- i don't know if you want to call it slowly try to move toward a deal here's what the latest is. cbs offered .55 of the shares and via com said we want .68 and they came back with an offer at a higher exchange ratio and has received a response from the special committee representing via com shareholders to that offer. is it progress

yes. it's being characterized by people close to the situation as slight progress though no one is saying they're anywhere near announcing a deal, and of course, as we pointed out many times it's not just about prices where there are synergiesof the combination. not to mention the desire to get an exchange ratio that mirrors what they say is the 40% contribution to the company don't have much to share the intractable situation under which they said i want my management team, i want to do it my way and they have made it clear she wants him involved as the number two unclear whether they made any real progress there. so some back and forth on economics. doesn't appear that much movement on social issues. as we get more, we'll bring it

to you in the days and weeks ahead. >> i'm hearing that allergen is one of the bidders >> if that's correct under uk takeover laws, they will be required to actually say something so let's wait and see. as i reported earlier, there were at least one or more bidders in addition seeking shire. you want to try to keep it quiet, which is one of the reasons i didn't know the name because they want a quiet dialogue once you get outed, you're forced to make a statement and put in all the names of advisers and everything else, which make it is great for reporters, but we'll see. it's a desired asset in speaking to the bankers around this potential situation, many believe including people close to shire, there will be something that occurs. shire will be sold, although

unlikely to taketa >> four executives at nike have left the company as the company tries to clear the way for more diverse leadership, i suppose. this time it's the vice president of footware. the fourth this week and the sixth total. >> we need to know more about how this is happening. you mentioned these are all very senior people. these are not people that don't matter to the future of nike we have not really had a clear the air moment about what's going on >> allergan? >> i had readvance they have a botox killer so if they are right, they have the meeting today. allergan is in a lot of trouble long-term. they need to diversify away from botox. everybody has to do something because people are worried about their businesses not doing well. >> they do also have shire

we'll see. developing story >> a lot moving today. biggest one-day drop for phillip morris on record dow is down 113. we'll get to other movers in a minute don't go away. [fbi agent] you're a brave man, mr. stevens. your testimony will save lives. mr. stevens? this is your new name. this is your new house. and a perfectly inconspicuous suv. you must become invisible. [hero] i'll take my chances.

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let's get to trading >> there's so much news today. i'm going to go with something positive mid-size businesses in the u.s. spend iing a lot. this is kind of if you're saying what's going on with tax reform, is it helping they got customers and it's real good so there's sol good news along with american express. consumers spending a lot of money. maybe that's driving the tenure. but there's some good news within some bad news today >> that's generally how it's supposed to work demand drives price. >> that stock selling down john is saying the quarter is going to be big because of the tariffs. and michael kneeland, they did not deliver and we have to find out why. >> those are two important names

tonight. we'll see you at 6:00 p.m. when we come back, we'll talk more about this market down about 89 watching yields as well. and bob wright on ge and trade don't ay.gowa feel that? that's the beat of global markets, the rhythm of the world. but to us, it's the pace of tomorrow. with ingenuity, technologies, and markets expertise we create the possible. and when you do that, you don't chase the pace of tomorrow. you set it. nasdaq. rewrite tomorrow.

welcome back to "squawk on the street." we just talked to madame lagarde. more coming up in the hour the dow trying to work its way out of a triple digit loss yields and inflation expectations and commodities we're going to start with trade intensifying talks the prime minister working to expand investment between the two countries and look at what it might mean for the economy, markets and more >> another top executive at nike is out it's the sixth departure in a month. we'll have a details >> plus are alpha males better at delivering alpha. linking to stock levels and investment performance but first up, let's get to more

on the president's announcement he's stepping up trade talks with japan >> good morning, carl. there were a couple key items on the agenda this week the prime minister of japan abe met with the president at mar-a-lago here in southern florida. the president suggested he wanted his top trade negotiators to look at getting ts united states back into the tpp this week they are putting the kibosh on that idea saying he would prefer a bilateral trade agreement. that's not the japanese government's preferred solution to the trade disputes between the two countries. the other item that was on the agenda here was the possibility of an exemption on those steel and aluminum tariffs that the president announced earlier in the year the japanese wanted some exemptions just like some of the other american allies were able to secure for themselves but the president said no.

here's how he explained his thinking yesterday >> we are doing 232 on steel and aluminum and if we can come to an arrangement on a new deal between the united states and japan, that would certainly be something we would discuss aluminum tariffs and steel tariffs. i would look forward to taking them off in the future >> so the president there saying at some point in the future he might take them off, but he link ed that to the trade deficit between the trade united states and japan. he doesn't seem inclined to move off those. the president is going to be moving to key west, florida, in a half hour's time we might see him on camera we'll see if we get further news on trade and north korea, which was the other big item here between the japanese leader and president of the united states

prepping for a possible meeting between the president and kim jong-un. at some point at the end of may and beginning of june, they are hork working on a location for that meeting and a specific time for that no details announced >> a lot to absorb there we'll talk to you later on this morning. for more on trade and the impact on markets, let's bring in the u.s. investment strategist and terry haynes, head of political analysis good morning to you both let me ask you, we're starting to see all the elements of business get caught in the cross hairs. whether it's trade conversations crept into the fed minutes, lumber and housing, business sentiment. are we at the beginning of something or more toward the end? >> i think where we are is frankly in the middle. where we are here is a world on u.s. and china specifically. no trade war but no trade peace. there will be volatility here

why the united states and china try to solve the technology transfer issues. we also have the steel and aluminum tariffs set up in part for national security purposes we're pursuing that against a broader backdrop of free trade and renegotiation of nafta it's proceeding well the president's announcement today that he and the japanese prime minister will pursue trade talks. there's a lot of free trade news going on here too. this is a generational reset in trade policy >> does that mean we have to start retrench iing to domestic-based companies how does an investor avoid >> i don't think we have to retrench here. what's going on is president trump has set this tone with a hard line approach and then pull it is back a little better we're potentially imposing $150 billion in tariffs that's about 1% of chinese gdp

so far there's been no implementation date. there's still time for negotiation. so it's not necessarily to say that we need to pull back on global investment thes it's interest iing that small companies have been doing well the domestic-oriented companies have outperformed, which is one way to play it but long-term some of these winners from disruption will be long-term technology, financials, et cetera. >> the macroeffect takes time. the stock price action takes place immediately. >> president trump's main goal is to, i believe, defend and support our intellectual property when you look at china, it's no longer a copy cat economy. they are innovating in their own right. so president trump's focus should be to continue to develop our innovative capabilities, r&d

and from that perspective it's not necessarily a trade war we're talking about. it's more erased for innovation. that's really where investors should be focused as well. >> the white house would argue innovation that they piggy backed on that we created and have to share in some cases or other areas where ownership is capped i wonder what you make of the chinese response, certainly the comments today that they have the wherewithal to sustain and survive any fallout from a more escalated trade war. >> i think there are two -- both the united states and china there are two levels of conversation going on. there's the one level that's the official response. and then underneath it, but also publicly, you get the signals that both sides are interested i think both the united states and china see this as a lose-lose opportunity. the trump administration is

trying to solve a specific problem with ip and tech transfer they are also trying to make sure on the 232 actions that for national security purposes they remain manufacturing capacity in a few specific core industries that doesn't really translate to a protectionist turn throughout the economy. so the vast majority here of sectors and industries are quite safe from all that >> sometimes the economics behind this, the president is very focused on the trade deficits with particular countries, but many economists will tell you with a budget deficit the likes of which we're going to run, it's impossible not to have large trade deficits given what we're going to do with the money we're borrowing is the focus incorrect does it lead to an incorrect conclusion >> to focus on a trade deficit does not make sense. the reason we have trade is each country is specializing at what

it's best at if china is the most efficient, they should be making that benefits the entire globe when it comes to trade. president trump needs to look at where can we become the most efficient producer of a given good for example, soy beans we're pretty strong in it should just look at areas of strength when you talk about budget deficit, the fiscal deficit we're about to accumulate is unprecedented at this point. >> does that figure it all into your view of the broader world at this point? allocations to fixed income versus equities? >> it crowds out productive investment governments tend to spend on interest rather than investing in the economy when you have large deficits but in the more medium term, we see rising interest rates bring us more late cycle from an investment perspective,

s&p returns can be quite healthy. fixed income we're more cautious on at some point that will reverse as we get closer to a recession nar environment, which we don't see over the next 12 to 18 months >> i wonder how you separate the issue of tariffs from sanctions. obviously, very different but sanctions themselves are now having an effect on aluminum the oil markets starting to wonder about what would happen if we saw more sanctions on russia and iran. >> sure, tariffs are a specific response to a specific issue in the limited presidential authority that congress has given to deal with those specific issues. sanctions, of course, are a tool of diplomacy and a tool of geopolitics. and i think you can look for the sanctions not to go away any time soon because many of the problems that they mean to address are both intractable as

they are in syria and may not be solved soon as in north korea. but as you see in north korea, the sanctions themselves have had an effect. so the white house will continue to use sanctions as a prominent tool >> certainly market reflects that for now oil near 69 today. thank you, good to see you both. let's get back to sara who is in washington at the imf spring meeting. just talked to lagarde >> the buzz here is all about not wasting the moment we have this growth. it's coordinated and it's global 3.9% according to the imf this year and next. but big warnings from lagarde on the rising debt levels and rising trade tensions. i'll share some of her comments, plus the treasury yield on the two-year you have been talking about it we have a live interview with the former treasury secretary jack lew later this morning.

>> thoughts? i thought certainly et hher ansr on facebook monopoly was interesting. you actually had to work it a little bit to direct her back to the focus of your question >> right, she's very careful not to call out companies and i think as you heard, politicians by name. the imf takes its role seriously to not be political. having said that, when it comes to these issues on rising trade tensions and debt levels, i think her positions are pretty clear. and the imf uses decades of analysis on things like debt crises and trade wars. what she's saying is that this is the wrong approach. multilateral trade negotiations are the right way. not bilateral olympic while she wouldn't say it's a mistake that prime minister abe and president trump are looking to do these

talks, this is an institution based on its history and framework would rather see countries coming together talking at the table she's worried about global supply chains chrks are completely interconnected. and on those debt levels, that's what she means by don't waste this moment. saying the deficit is becoming a problem and really putting it into terms that americans can relate to. we have children and don't want to saddle them with the burden of the debt, which she predicts will slow economic growth unless something is done about it even some rising regulations about anticompetitive companies. she wouldn't name any by name, but clearly that's part of the mix as well when it comes to her idea of global coordinated action >> good interview and we look forward to hearing you with secretary lew in a little bit. when we come back, general electric getting ready to report earnings later in the week bob wright will join us to talk about the road ahead for that company. another day, another

departure. it's the vp of footware at nike announcing he's leaving we have details on the executives that have left over the last week or two aonhetrt"s ck iba in minute. dow is down 65

general electric reporting first quarter earnings before the bell tomorrow. all eyes on the turn around and a possible breakup depending on what form that might take.

stock is the worst performing so far this year. joining us to talk about it is bob wright bob, it's good to have you back, good morning >> thank you, carl thank you very much. >> you have talked many times about what a painful trade this has been for you and anyone who has been in the shares any reason to think tomorrow could bring an operational turn? >> i don't know that it's going to make a major announcement i think we have to pay a lot of attention to cash now. accounting is so complicated in terms of the new accounting procedures they are going to have to go through for contracts. spending too much time on accounting i think isn't going to be profitable spending time on cash is, i think, where we're going to have to look. there's cash outside the united states i don't believe they have made a determination when they are going to bring that back in, but

it's certainly positive. they have to work that down on the debt they have $150 million of debt they have pension issues but that's probably more achievable right now, i think really the issue is getting cash flows and looking at the cash flows. because they are too thin right now. >> what options do you expect them to consider or talk more about in light of that focus on cash anything we haven't discussed so far? >> well, they have announced about $7 billion worth of transactions that they are either doing or considering to date i just including the one that was just recently announced i think they will probably have sol more about that. i'm not so sure they are going to do that on the earnings state. they may do that later on in the spring

john promised a major speech or meeting about the future then. it's probably going to take a little later i don't see how they can sell out these larger businesses because that's not going to really help the situation. i think they are going to have to tough it down >> why don't you think it will help the situation your instincts are right they are not going to announce anything tomorrow. they may be asked some questions and have prepared answers on the call but i think we're talking a month sort so from now to get more details in terms of the plan why do you think doing deals involving some of the big businesses, whether you want to call the sale or spin or some sort of a transaction is not necessarily going to help. >> i didn't mean it that way i meant a sale of those businesses that's really in liquidation i don't think that's a very

attractive if they want to do some joint ventures with either parts of those, that would be well receive received the cfm situation right now is just so unfortunate. it's unfortunate that it happened but it couldn't. happen at a worst time for ge. i want to make a plug. >> by that you mean the southwest engine for those who might wonder >> right, the cfm is the engine that was on that plane it's probably the world's most used commercial engine and it has incredibly great history i plug one in there. david joiyce is the head of the arrow space business for ge and he's an engineer's engineer. he's in the engineering hall of fame those people are so dedicated to

safety they are some of the finest engineers in the world i imagine they are just going to rip things left and right to find out why that particular piece of metal was weakened. it just comes at a tough time. >> it does 6700 planes this version is currently on we talk about the workhorse of economics, but the engine on the plane is an amazing machine. bob, david has done so much on media alone. i wonder what story you think is most intriguing right now and what pot is going to boil first? >> i think the president is is handling himself very well, by the way, in the discussions with japan and the discussions about north korea. i'm very proud of the way he's handling this. nobody else has ever wanted to

get close to try to do anything significant with korea so we'll see what happens but i think it's all upside from my standpoint. >> bob, while you're here, i'd love to get your insight on something. i have been reporting on cvs and viacom and whether they can reach a transaction. here's an area you have a lot of experience in. nfl rights, they are up in 22 for cbs. you have to start negotiating well ahead of time what's your sense there in terms of where they are going, how much people are going to pay, new competitors and the likes of whether it's amazon or others in the fray does it get tougher if you're cbs to keep a franchise like that >> cbs has long been a stall worth. they have paid up every single time to get as much access as they can i would get they will continue to do that it's really very expensive

in terms of new people coming in, the nfl seems to be encouraging that they are doing it themselves they are taking on a lot of games themselves amazon may be a bidder for more than a small piece of it i think they will be open to lots of different bids it will all be expensive >> any calls, my predictions from you on at&t and time warner taking the stand today and depending on the decision you think we get how does that color the future of media >> i have always believed this is a vertical integration and that should be allowed to go through. it's very difficult for me to see how that can be turned down. but it may be. so i think he's got the right hand in it now he has to get the assistance and the government side. but if he doesn't get it, i

think you'll see them changing their path i think they will probably sell directv and take another piece and go back to 5g. that seems to be something that they are very interested in. it will change if they don't get it i do want to say the news of the day. i wanted to give a plug for my harpa program for pancreatic cancer there's an announcement today. i saw it earlier today that the organization that rests inside of the defense department just made an announcement showing how it really can impact technology and it has to do with drones and the ability to tons of drones. if you read that, you'll understand what i'm trying to do inside of health and human services for an agency that is

called harpa, which is just health answered research programs and i've got a lot of support now in the senate. i have senator rubio on one side and senatorbooker on the other side helping to get this done. i've got technologists out there. dean kamen, the segue guy who is is one of the most creative innovation persons in the world and has ha place in manchester he bought up a series of buildings and has stuff going on there. he's well into this with us giving us a lot of support so i really hope i can get this across this has no financial interest on my part whatsoever. it's the government helping itself and moving much faster to avoid one more person unnecessarily dying from pancreatic cancer. they are up to 45,000 right now.

that's a terrible issue every single day dying we can fix that. >> anyone who has followed the work you have done on pancreatic cancer or diabetes knows not to underestimate your resolve we appreciate you coming on. we'll see you soon, i hope >> thank you very much >> bob wright. when we come back, departures at the top. another executive at nike announced he's leaving the company. "squawk on the street" is back right after this at fidelity, our online u.s. equity trades are just $4.95. so no matter what you trade, or where you trade, you'll only pay $4.95. fidelity. open an account today.

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play [music plays]his". when everything's connected, it's simple. easy. awesome. here's your cnbc news update the power is is mostly back on in puerto rico after the island suffered its second major blackout in seven months the first was caused by hurricane maria. yesterday's occurred after an excavator hit a transmission line they expect everything to be restored by noon it's the end of an era in cuba for the first time in 60 years, the island will not be ruled by someone with the last name castro senator cans now bring

babies to work the chamber unanimously voting to allow children up to the age of 1 on the floor. that rule change was inspired by tammie duckworth who became the first senator to give birth while in office. police in texas thought the danger was over after they arrived at a home hit by a truck. but the home then exploded the truck hit a gas line family inside is expected to recover. the video just unbelievable. that's the cnbc update back to you. >> thank you now it's time for our etf spotlight. we turn to bob who is on the floor with more on the big moves in commodities >> commodities have been underperforming until recently we have seen some real action. i want to show you a couple things if you want to own commodities, the big one here is the dbb. take a look here this is the power chairs commodities tracking fund.

14 different commodity etfs there tracking right now it's near a three-year high you also want to look at commodities in general if you want to own base metals if you want to own stocks, global metals, that's the bhp. that's also doing very well. if you want energy stocks, you can own oil futures. that's the uso that's up 6% in the last month and you're owning futures contracts. if you want to own the stocks, they too have been rallying. they have been underperforming all year this is quite noticeable in the stock market as these energy stocks have become market leaders. i want to point out what interest rates are doing here. because we're seeing some real moves in interest rates in the

last few days. we're seeing some moves up in some of the interest rate etfs out there. if you look at the agg, this is the big one that's out there this is the big basket of treasury and corporate that's sitting right near a four-year yield. this is prices under pressure. yields have been moving up right across the board in particular, short-term treasury yields have been moving we have seen some fairly heavy movement in volume in the short-term treasury. the symbol is shy. this owns a basket of one to three-year treasuries. we're going back a long way now. this is near an eight-year low these are the prices that are near eight-year lows this is reflecting the fact that recently short-term rates have been dramatically moving to the upside back to you. >> thank you some news to get to now out of nike let's go back to sara. this has become a tort rant of

executive departures >> absolutely. it seems like another day, another departure. this time we're talking about the vp of footware greg thompson, it does mark the sixth senior executive to leave the company just in the last month. the most senior came a month ago. it was trevor edwards, who is the company's number two he was the ceo's successor most of the other have been vps at the company this is a rare cleaning house that is playing out in the media. with the the company making major changes. it comes after hr complaints internally about inappropriate behavior, cultural problems, a bro culture and even questions about diversity in ranks the time is pretty unusual as we have been discussing, nike is doing relatively well the stock has held in there with the rest of the market this year revenue growth has been strong thanks to markets like china and western europe it's growing market share.

but certainly it does raise some questions about success session, the culture and really about the continuity in a company that's otherwise tlooiing how do you clean up and keep it going when you have so many high level executives out i will say nothing specific has been charged for any of these executives most of it has been reported by media outlets. but it does raise some question as to how much more there is to come and how they are going to if i can up pick up the slack. we have seen two executives promoted to take over trevor edwards' role. we'll see if anymore changes come at nike >> are we expecting to get a full articulation from the company as to what's going on here >> clearly, they are going to have to start talking. so far the analyst community has

been pretty quiet. as i said the business has been going strong but the more departures at such a high level, the more investors will start to question what's really going on. how big of a problem is this, how big of a distraction is this going to be. the company doesn't report again until june the scandal was in the early stages they didn't get any questions on the earnings call about this but clearly, i'm going to try to get them to talk about it. and i think they are going to have to be forced by investors to talk about it who are wondering who is in charge clearly, this is going to leave a mark and leave a big opening in terms of some of the senior leadership head of footware, this is their core business. we'll continue to watch this story. and here in washington, i'm going to continue to monitor the imf meetings the story about global growth. more from our interview from christine lagarde.

what she had to say about president trump, trade, tariffs and more plus later on,en don't miss the interview with jack lew. rising bond yields, trade tensions, so much to talk about here g ow coming up "squawk on the street" returns after this ♪ with this level of intelligence... it's a supercomputer.

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welcome back to "squawk on the street." let's get back to sa is sara in washington with more of her conversation with christine lagarde. >> there's a debate on wall street about whether we're in peak earnings. bob has been talking about it every day. there's a a debate about peak growth the global economy looks to be in good shape, but there's new risks and worries that this is as good as it gets >> we're seeing looming clouds on the horizon and probably more

so than we did six months ago. that has to do with, first of all, the fact that some governments have been lagging behind and not doing the reforms they should be doing now we are seeing a big mountain of debt $164 trillion in debt. that's a big number. two third of that is in the private sector we see high leverage the in many corners of the world advanced economies, public debt is is at its highest since the second world war >> and on this debt point, lagarde is specifically calling out the u.s. government and the trump administration take a look at this chart the imf tweeted out. the u.s., this is really interesting, is the only advanced economy where the debt ratio versus our economy is increasing rather than decreasing over the next five years. and this is where the conversation comes back to tax reform it's supportive of corporate tax

reform and helping u.s. corporations be more competitive, but there were a lot of warnings not to poke a hole in the deficit. it did the opposite with the new projections we're going to return to trillion dollar deficits by 2020 and it's something for lagarde and for a lot of leaders here who wonder what the future is going to hold with all this debt piling up in the u.s. >> and this remarkable -- actually they put it into a gif of the advanced economies. the only one that sees the debt ratio going higher is the united states >> yes, and i said to her, fiscal conservatism is not really envogue right now the trump administration has come in and increased spending certainly, the fiscal stimulus is welcome for people who look at the u.s. and global economy and we are to see a rise, but the question is at what cost why are there no plans right now to deal with the debt and the

deficit. and the answer is we're not quite seeing the urgency in the markets. but there are people here who are making a point of warning this will be a problem for growth for our children and their needs to be some plans to deal with it she has a relationship with the treasury secretary you can bet this is something they are going to talk about >> thank you, sara it can all end very badly one day. there are some frustrations at the fed. 5 of the 6 reserve governors have been appointed by president trump, but will a a new fed board have the marketings back for the next crisis? steve joins us now with more on that >> a wave of unprecedented change coming to the fed and the question is is this. the latest nominee richard clart is praised for expertise in knowledge of markets john williams has been named the

most important bank president of all. and the fed chair that typically is at the center of running fed policy but the markets are wondering does the fed have its back most say yes, but it's going to be different next time they have praised the response to the financial crisis and the nomination was clear that he would use the fed's tools in a crisis, but that doesn't mean it's going to be easy. the politics of intervening are horrendous and far worse than they were the last time around because of changes in the dodd-frank law and the background of the new fed heads, this is going to be a bit more reluctant to intervene overall and etspecially more reluctant t intervene in individual companies. vincent ryan heart was a top staffer. he said the fed is more likely to prefer interventions in markets rather than in firms

that makes another lehman brothers bankruptcy possible if the new regular will toir regime fails. so it will be more reluctant to pull the lever i will be talking about this issue and others exclusively tomorrow with minneapolis fed president at 1:30 eastern time >> steve, a lot of this dove tails with the ongoing discussion of just how this white house has reshaped the fed. >> it's true a lot of people talk about who wasn't chosen. the people who weren't chosen. and it could have been much more hands off types. it's interesting to think about the politics versus the economics. the economics say that if you get into a crisis, you get interest rates and use what you have early and often but the politics go against that there's a lot of anger that came from the financial crisis. some of that might have helped elect donald trump >> someone said yesterday that given expectations post election that the white house's choices

have been conventional do you agree >> i do. i think i haven't finished working this, but a lot of the folks in this thing in the current fed seem to come from one or two of the bush treasuries and they were described as somebody who was the more business republican side of things, which are much more in the center perhaps than some of the other normminees for other agencies out there a lot of people see this as continuation but a lot of debate about this it powell put and where the fed mooigt come in >> some really important implications long-term, that's for sure as we go to break, take a look at shares of amazon on the move as jeff bezos writes that letter and reveals tl there are more than 100 million prime members worldwide. more than most analysts had suspected. we'll talk about that and don't miss treasury secretary jack lew with sara at the imf meeting the dow is down 25 quk t see cties"sawonhetrt"onnu in a moment. i'm all-business when i travel...

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quietly small caps are near all-time highs find out more on trading nation. more "squawk on the street" coming up.

welcome back some developments involving the pursuit of uk company shire this morning. takeda made public its approach in which it was rejected, by the way. the bid was for 1775 in cash and these are in british pounds. so about a split of about 3268 not something necessarily us that a lot of the uk-based

shareholders of shire in many other markets would be interested in given the liquidity of the shares to a certain extent not to mention the balance sheet that would have need etted to have taken place. there's continued pursuit by others i had earlier reported on at least the interest of potentially as many two other large pharmaceutical companies in mounding a bid for shire than reuters reported allergan's name as one of them we got confirmation just a few moments ago saying it is in the process of evaluate iing a full range of potential strategic actions that will create value for shareholders and also is potentially at least early on in the stages of considering a possible offer for shire. no offer has been made there could be no certainty an offer will be made take a look at how shareholders are responding to the potential interest here in shire

that's not a great review. not necessarily what you want to see when you are considering mounting a bid it would be a large one. all allergan has a good deal of cash on hand due to the business sold a number of years ago. but right now the reviews there don't seem particularly positive shire, for its part, is up sharply. the idea that basically it may be in sale mode and people close to shire indicated their belief it is potentially or even more likely than not that shire may end up as sold when this all is said and done. >> quite a few big movers today. that's just one of them. let's see what's coming up on "squawk alley. >> take a look the earnings and the revenue were up. analysts ticking up their

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welcome back to "squawk on the street." i'm contessa brewer. one of the notable laggards has been staples philip morris and altria, down 14% on pace for its worst day, dating back to its spinoff from altria in 2008 carl >> contessa, thank you very much getting a tweet from the president a few minutes ago. great meeting with prime minister abe of japan, who has just left florida. talked in depth about north korea, military and trade. good things will happen. of course, meeting in florida, talk about potential bilaterals and the ongoing move, perhaps, to get some direct talks going if not between the south and

north koreans, between north koreans and the u.s. let's get to washington, meantime, with developing news on the nafta front kayla tautsche is there. >> between ambassador robert lightheiser, top u.s. trade official and counterparts from canada and mexico. they've been holding high-level talks a couple of times this month as they are trying to work toward a deal. just a few moments ago, we caught up with canada's foreign minister as she was on her way into the building. we asked her about the possibility that a deal could come in the next two to three weeks. we reported on cnbc yesterday that lightheiser had briefed congress to expect a deal in three weeks. she said she was optimistic but it would take time to work out the finer details of this agreement, which is 25 years old and is incredibly complex. one of the most complex parts of this deal is called rules of

origin it's the requirement for how much u.s. content is in any good, in this case vehicles, produced within the nafta countries. that is something that the u.s. has been holding a very hard line on but recently has shown some moves toward softening that proposal freeland said she was optimistic about what she called a creative proposal put forth by the u.s. about a month ago, but said rules of origin continues to be, in her words, fiendishly complex. we'll see what happens and if that proposal is something that all three sides find workable. she said she will leave the finer details of negotiations at the negotiating table. there will be talks throughout the day today and tomorrow we will see what comes out of these two days of meetings and whether we do see that deal in a couple of weeks' time. carl >> kayla tautsche in washington.

interesting conversations as we watch the nafta negotiations. >> wrapped up in trade negotiations going on are shares of qualcomm. authority in china came out and said it's going to take us longer and there are difficult things we're dealing with when it comes to qualcomm's acquisition of nxp, for which qualcomm has agreed to pay $127.50 in cash per share. and qauualcomm stocks are down n that will it be enough to overcome potential objections of mofcom and what had not been previously offer odd or previously discussed when they thought they had an agreement wrapped up in the larger issues between our two countries, china and the

u.s., said earlier, though, it would be a very chilling signal, were this deal to be held up. >> you're watching that closely. thank you for that, david. a lot more from sarah at the imf spring meeting we'll talk with former treasury secretary jack lew about the state of the economy, trade, tariffs and more dow down 350 experience lexus safety system plus standard

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good morning it's 8:00 a.m. at amazon headquarters in seattle. it's 11:00 a.m. on wall street and "squawk alley" is live ♪ can't touch this ♪ can't touch this ♪ break it down ♪ oh oh oh ♪ ♪ oh oh oh oh oh oh ♪ ♪ stop hammer time ♪ >> good thursday morning welcome to "squawk alley."