this is actually supposedly close to reality on this friday may 11, 2018 "squawk box" begins right now. good morning, everybody. welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. happy friday, everybody. let's look at u.s. equity futures. yesterday another strong day with the markets the dow up almost 200 points the dow in positive territory for the year to date now this morning you will see the dow is up by 22 points that's the early indication. s&p looks up, just barely. nasdaq down about 2 points a strong week. the dow has its first six-day winning streak since february.

you're talking about a gain of over 1200 points look at treasury yields. yesterday the ten-year was yielding just below 3% it stays there this morning at 2.951% then there are oil prices, which have spiked on the president pulling out of the iranian dukelar deaduk nuclear deal couple big stories we're watching let's get you through them president trump expected to lay out his plan to bring down drug prices senior white house officials say the proposal will require medicare part d plans to begin passing along the drug discounts they receive to patients and on the data front, a couple of numbers to watch today. u.s. import and export prices are due at 8:30 a.m. eastern time in corporate news, semantic shares are plunging today. the cybersecurity firm disclosing an internal investigation as part of its

fourth quarter earnings report the company is looking into unspecified financial issues raised by an employee and warned the filing of its annual report as a result of all of this may be delayed look at that arcelormittal reporting better than expected first quarter earnings they are giving an upbeat outlook for the year they would never get that on "wheel of fortune. if you bought ts, you could do that >> or an "a. >> demand appears strong, the spread between the price of steel and raw materials is healthy. shares of yelp lower today this despite the company

reporting a narrower than expect the revenue loss revenue beat forecasts as the restaurant and business review site added more paying ad accounts and tech in the last week, the nasdaq is almost back to new highs. i dare say -- i'm not going to say it, i think apple led the way, sorkin. we were talking about it not that it can -- you extrapolate apple's results to anything else. >> just the market itself. >> the leadership of technology. >> if you seen how close apple is to a trillion dollars >> then the other story today, sorkin you know, it's not all about the stock market we want wages to go up and

everything when you repatriate, you hope it does spread more fairly. the rap is buybacks is what it will be used for there are positive aspects none of us wanted the market to go down 40%, right >> the other question is who is propping it up >> steadying the market. is steadying the same as artificially propping? >> money is fungible and it flows downhill to where it will be treated best. >> the trickle down, that's what the democrats will counter with. >> this will not trickle down. >> it will trickle down to -- it will trickle it will trickle, not gush. that's what they will point to

it's the never-ending conversation going on for decades. >> but you're not just going to hire and raise wages it's all market forces hopefully it percolates up if demand is not there, you don't all of a sudden add capacity >> which is what we ran into with qe. >> that's what they do in china. >> that's because they're a state-controlled economy >> they will keep the furnaces running and dump it somewhere. >> not here anymore. among the top washington headlines. the "washington post" says that it has obtained documents that reportedly show at&t paid president trump's lawyer michael cohen $600,000 for advice on its merger with time warner. eamon javers is following this story from washington, d.c good morning >> new questions about what exactly at&t was paying the president's personal police officer for in the months after the president's election this is from the "washington

post" reporting last night that michael cohen got $600,000 from at&t, and specified that he would advise on that time warner merger according to internal company records. the "washington post" saying three days after president trump was sworn into office, the telecom giant, at&t, turned to his personal attorney, michael cohen, for help on a wide portfolio of issues, including the proposed merger with time warner remember, at&t put out a statement earlier in the week in which they confirmed that they had hired michael cohen, said this was not lobbying or legal work they say when we were contacted, we cooperated fully providing all information fully in november and december. a few weeks later our consulting contract with cohen expired. since then we have received no otherquestions from the specia

counsel's office and consider the matter closed. during the campaign the president was critical of a potential at&t/time warner deal. his department of justice looked into it, and did weigh in against the deal that court case is winding its way through the process now. we expect a decision maybe in june on that maybe even sooner. so the president came down against this deal. at&t had a reason to figure out michael cohen's state of mind on this issue we'll await more detail on how much they did pay him for that and how much they did ultimately pay him. also we will see automakers in washington as well, that event is at 11:45 at the white house, later this afternoon we'll see a rose garden ceremony at the

white house and a meeting with the drug companies ultimately they want to allow for more types of negotiation between the government and the drug companies we'll wait and see what the specifics on that are. the president has said the drug companies are getting away with murder he wants to lower those prices we'll see that announcement this afternoon at the rose garden >> eamon, thank you very much. we'll watch that we also have the health and human services secretary who will be joining us to talk through this later this morning. alex azar will join us at 8:00 a.m. >> eamon, before you go. one cohen question is there a way to factor this into a bigger legal problem for the president or are we just talking about cohen? >> i think we're just talking about cohen. i asked the white house if the president knew about these

payments at any time they won't answer that they refer it to the outside legal team the facts we have before us suggested michael cohen was doing this on his own and also suggest that michael cohen was doing what a lot of political figures do in washington, d.c., hang out a shingle after their guy gets elected and say you want advice on the new guy i'll give you insights companies typically pay for that it's general consulting. it's not considered lobbying in this case, i talked to a lot of people in the space yesterday, everyone tells me that because so few companies had any knowledge of trump's inner circle or knowledge of trump himself, they were desperate for information on him. also so few people were close to trump who could give that advice, that created a supply/demand imbalance in the political consulting word. that's why these prices that we see michael cohen was able to charge was so high michael cohen here was at

$100,000 a month on novartis he was making a lot of money, much more than other consulta consultants. >> at&t has not indicated that they think it's a mistake to have done so the reason i ask is the ceo of novartis said he thinks it was a mistake that they entered into an agreement with him. >> novartis said this was not a proud moment, this was a mistake to involve themselves with michael cohen. they also said they met with michael kcohen once and determined he couldn't provide any of the services they thought he could provide and they never met with him again they continued to pay him for a full year after that because they didn't want to break the contract the current ceo of novartis seems to be blaming the previous ceo of novartis for this

the current management can't put this on previous management. at&t is taking a different approach >> okay. thank you. appreciate it. a bit of other washington news today u.s. and chinese officials are expected to meet in d.c. to discuss trade disputes china's top economic official is scheduled to come to d.c. next week now let's get back to the markets. u.s. equity futures this morning are mixed. you can see -- well, they turned around nasdaq up by 1 dow up by 29 s&p up by 2 points joining us is julian emanuel from btig and peter boockvar gentlemen, this may be a true debate, the two of you have fairly opposing views on these things julian you're bullish on this,

peter you're concerned about a reveg recession. we have seen stocks pick up significantly. julian, lay out your case for why you are a pull at these levels >> we think that if you look at the nine years of rally, the bull market is climbing the wall of worry in january there was no wall of worry. that led to the correction here the wall of worry has been rebuilt and we're at a point where equity investors are more cautious than bond market investors. the bond market is telling you because treasury yields are pinned to 3% that the outlook for the economy remains strong the outlook for inflation is subdued. that's part of why the dollar rising is a good thing, not a bad thing for equities from our point of view, when you think about the fact this wall of worry is here, earnings are as good as they are, yes, we're concerned about the treasury curve flattening, but that has

not necessarily been a precursor of recession in the next 12, 24 months all the time. for us, valuation is right sentiment is now to the point where the market will climb that wall of worry. we think new highs are coming in the second half. >> peter you look at the same factors and take a different view why is that? >> to me, inflation now is above 2% and remaining sticky, which means the fed will continue on their path of more rate hikes this year and next year, and shrinking the balance sheet. typically monetary tightening leads to issues. we have credit cycles now. we're dependent and addicted to the cost of money and borrowing. when the fed is tightening credit, rising interest rate also have an economic impact we'll see this consistent butting of heads of tightening on the monetary side and on the fiscal side. this year we're seen a sharp rise in interest rates and

equities that traded well because they're little changed as we progress through the year, the fed will again raise interest rates a few more times. the balance sheet reduction will go from 90 billion a quarter in q2 to 120 billion in q3. by september, the ecb will end quantitative easing. and that liquidity drag will matter the 5s 30s spread yesterday got below 30 basis points. that's telling and should not be ignored. >> is that a situation where it takes time for this to catch up? i hear your point about how the fed raising rates too quickly is what always ends these cycles. but the market is expecting a few more rate hikes from the fed this year. >> the fed will be as transparent as it can be that doesn't change the fact that the cost of capital will go higher the russell 2000, 40% of the debt on russell 2000 companies is floating rate

libor continues to go up that will impact cash flow we'll get the benefit of lower taxes, but we're giving some of that back in higher interest expense. we have to some day rectify the ultimate question, whether it's an absolute level of interest rates or a relative level of interest rates for hundreds of years we know how corporations have deployed capital, what the cost of capital is, what the return on capital is typically corporations could do well if short-term rates were 5% or 6%. now i know that could be tripling from the lows, so that the inflection point has chan d changed, but i still can't believe -- like a mortgage would it kill me if i had a 5% mortgage when my parents had a 16% mortgage >> it wouldn't the question is what happens -- >> i know.

>> total business debt as a percent of gdp in an expansion is at a record high. the last time we were this high for q1 was '09 at the depths of the recession. >> i didn't realize that 40% of the russell is floating. you're a smart company if you took out debt right now. >> those who termed it out are properly prepared. >> but financial breaks are scary. the financial crisis was not a solvency thing, it was a liquidity thing. if it goes up quickly, and you can't cp -- >> the other day we saw declines in loans for commercial real estate, credit cards, autd tooss

that because the cost of money is going up? not sure, it's one quarter, but it's something to pay attention to people are sensitive to changes in interest rates when they were so long for so long. >> going back to absolute versus relative, we are at 3% in the ten-year yield we're going to grow earnings we won't grow by 20% in the next three quarters, but we'll do double digits. under 17 times 2018 earnings with the prospect for an economy that may actually surprise to the upside if you look at it, what investors have been missing is the dollar strength gives the fed more flexibility to not hike as much as the market may anticipate now we're not saying that will happen but they have the flexibility do it >> meaning you think they're watching the dollar, too with

all the other things they keep track of >> sure. there's a lot of people on staff in washington. no question. >> a lot of eyes to be watching things >> if you look at it, i bet you the white house is watching the dollar, too it's probably a bit more than coincidence that the dollar rallied and the president's approval ratings have moved up at the same time after that slippery slope looking the other way. >> though the president said in the past there are benefits to a weak dollar, too he said this as a candidate. >> i think they got rid of that poll, didn't they? reuters had a poll where trump was doing well, they said, you know what? we don't believe our -- >> did they? >> yeah. >> i saw it. >> they pulled the poll. we're rejecting the results of our own poll >> was an online poll. >> but it was huge

>> but the other polls, there are other polls that are turning -- >> there are polls that are improving. it was not -- >> that's such an insincere -- don't do the poll then if you think the methodology stinks, don't do the poll. >> the right went crazy. it came over my transom. >> i've been distracted the past week i've been in omaha >> beautiful lighting in omaha you remember >> good team >> were they out there for a while? >> they're there every year. a great team >> got it. >> guys, thank you very much we'll see what happens we can watch the next six, eight months and see which way the direction turns. >> the generic thing, andrew, i'm worried about, for you the generic democratic advantage down to 3 points

places that don't want to report that have to report that 3 is not enough to necessarily take back the house. >> what were they saying comfort levels below 5 >> i see you and nancy -- you are spackling -- putting the new wallpaper up in the speaker's office before you do that, before you do that, hold off. the signs. >> it's friday >> coming up -- >> what was it yesterday thursday it was thursday. >> there was something on thursday, too. coming up, an early investor in theranos doubling down on his support for elizabeth holmes interesting. >> more than interesting >> she doesn't have a lot of people coming to her side at this point it is a great vision to do it with a little drop of blood. >> it would be great if it worked. >> we'll hear more about that when "squawk box" comes back

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welcome back to "squawk box. tim draper is offering a staunch defense of theranos founder and ceo elizabeth holmes here's part of what he said on "closing bell. >> i feel we have taken down another great icon this woman came to me when she was 19 years old, she said i'm going to transform healthcare as we know it she got bullied into submission. this was a startup it was a great vision. it was a great technology. she's going up against some very powerful people in the drug companies, the ama, the fda, she's transforming healthcare. somebody goes in and tries to transform healthcare, they'll get attacked in a lot of different directions and she was. this is one of the cases where the entrepreneur was defeated. >> draper was an early investor

in theranos. he said the company could have been a big winner and he still feels great about backing holmes, though any of the reporting done on this primarily by the "wall street journal" shows a very different picture basically set up as a fraud. the technology never worked. then they lied about it. >> i read "bad blood." the fellow who exposed this in the "wall street journal." i hope we can get him on the show >> say what you said early if the story is to be believed, she is oneof the great fraudsters of all time forget about whether you think she had some vision for the future she was literally taking blood -- it wasn't that they were doing this in a beta form and experimenting in some kind of -- they were doing this at walgreen's out in the public. >> right >> the public was exposed.

>> they were outsourcing it to get the results. >> people were getting bad results. >> they were getting the wrong results. this is on real people the funding she got the entire time was based on the fact she was getting agreements with safe w wsafeway, with wall greegreens she was lying about what the machine was doing. >> very strange comments i could say i have a vision of curing cancer for everyone where no one -- and i have this thing that may or may not work but i will start using it. it has no effect doesn't cure cancer, but my vision was to cure cancer. that makes it okay >> like stealing money from people the most outrageous thing is they were doing this in the marketplace. people are getting the wrong results back on tests. >> if those articles were not

written, they would still be doing this >> the idea is great but it's bizarre what do you think -- >> for him, he's just seeing it in a -- he's seeing it as an investor trying to move the world forward. it's true. there are others trying to pursue what she was trying to pursue there are five, ten other companies now trying to build the kind of technology she was maybe they'll get there. hopefully they'll get there without having to lie along the way. it appears she needed to lie to continue to raise the money that she -- i think she thought if you want to be generous to her, i think she thought it was a fake it until you make it story. if she could keep raising the money and working on the science, she could ultimately get there. but the problem is it's a chicken and an egg thing >> is that a real expression,

fake it until you make it? it's a good expression in this case to me, it sounded funny. i had a vision, immortality for everyone i would like that to happen. >> if we give you money, you'll make it happen? don't have any r how to do it, it's a noble thing to aspire to would you commend me for that? >> i commend you for having that vision >> we'll move on he's not going up or down, this story is about going down. this is a different story. >> ae lelon musmusk, we said hea problem for solving l.a.'s traffic problem. >> and it's not boring >> the company is called the boring company >> it's not boring >> it's not boring company

>> this is the boring company, but not a boring story musk says he can solve the problem of l.a. traffic. check out this time lapse video posted on instagram last night it shows the first leg of the boring company's underground tunnel in l.a. musk writes the tunnel is almost done the boring company will offer free rides to the public in a few months >> that for real >> this is an experimental tunnel they built to see if it's possible >> what's the difference between this and a subway? they never had a decent subway system out there >> he's done two things. he figured out that the cost of very wide tunnels is high. so he tried to make a tunnel as narrowly as humanly possible your car gets on almost like a little trolley, and then because it can't veer off, you can have the sides as close as humanly possible

that reduces the cost of building the tunnel. it's still very expensive. >> like you drive your car down to this? you drive it on to a track >> you drive your car on to a track and it shoots it at a high speed. >> it does but not hyperloop. >> this is not hyperloop >> this is one you can drive on and off. >> right and your car is not a hyperloop car. maybe in the future your car could be put in -- that's a vacuum sealed situation. you would have to change -- >> unless this stuff happens really quickly, you will need more immortality idea. i think we should work on that first, shouldn't we? so we can see all this -- >> great progress? >> yeah. >> don't you think >> i just want a transporter that will solve immortality, the car issue. >> that will be a little -- >> the transporter >> it's possible to know your

entire makeup and be able to reproduce that somewhere -- in a discrete location. but would it be you? that's the thing >> is there a soul does it weigh 9 ounces or whatever 9 grams? >> i'm not signing up to test that out. >> we all saw jeff goldblum. >> what happened to him? he got it back he's okay. he wears some weird outfits. >> check out this video of vladimir putin taking to the ice to celebrate his most recent inauguration he does have a shirt on at least. putin scored five goals during the exhibition hockey game as goalie on the other end, he didn't allow any goals he's unbelievable.

no surprise his team did win >> can you imagine if you accidentally scored a goal >> football players used to be offense and defense. he is goalie and striker >> the goalie sees him coming -- >> you have to make it look good oh good shot, president i don't know >> we have a lot more coming up in just a minute >> the last goalie is still breaking rocks >> ehud barak will join us in studio in a bit. we'll get his take on the u.s. pulling out of the iran deal and talk about his new book. first as we head to break a look at yesterday's s&p 500 winners and losers

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welcome back you're watching "squawk box" live from the nasdaq market site in times square. good morning in our headlines today, dropbox reporting better-than-expected earnings and revenue in its first result since its ipo in march. they also added more paying new subscribers than analysts had expected the ceo says working with competitors helped grow -- helped dropbox grow. >> a lot of these competitors have become partners their customers have their information on dropbox, want to

organize it on dropbox and want that to be a good experience tying all the different cloud ecosystems together is a job that we do better than anyone else >> so you're saying this is not a winner takes all field >> that's right. >> shares of dropbox are up 8% since their debut, but down 4% in extended trading. nvidia beat forecast as demand jumped for its graphic chips. but sales from cloud services fell short of expectations that stock is down 1.2%. the world reacting to president trump's decision to pull out of the iran nuclear deal and restore full sanctions on that country. joining us now is former israeli prime minister ehud barak. he just released his memoir "my country my life: fighting for israel, searching for peace. when we look at it, you've been

there at all of these very important points for 40 years or so a lot of it is covered in the book this other stuff is front and center but in the book we're going back to prime minister rabin and all the tumult over the last 30, 40 years. does it feel now like there's anything positive happening or is it just difficulty the entire time, intractable almost >> in the middle east we never have a dull moment it's extremely intensive then. i started deep in the previous century and it will not be quiet now. i told the story from my early childhood in the remote areas to the top of the army, top of the state as prime minister, minister of defense. a lot of story there's we can cover in a few minutes >> it's hard

read the book. so let's talk about what is in front of us. i'll preface this with you see the political environment in the united states. i can't imagine that israel is, to the same extent in terms of tribalism, one side versus the other, but there's that component as well. you were labor party, i read your view on president trump's action, i think of netanyahu and the presentation he made and you don't -- that's not where you're coming from at all with mr. netanyahu >> yeah. the reality on the ground is complicated in the middle east, nothing like the west. but we are busy mainly with the real issues, with putting our hands on intelligence, being able to hit as we did just a day ago 50 different targets simultaneously, very effective looking at the political

landscape, i'm in no position to remark about the judgments of the americans. >> you think it's a mistake for president trump to pull out of the deal even though you think it's a horrible deal, but you think it's a mistake to pull out >> i thought it's a bad deal but president obama signed it. so once he signed it, it became a matter of fact i thought there were other ways to deal with the missiles, the deployment of them, whatever tales that he are spreading around the area. once the president pulls out, it does not help the deal, but it created a new reality. the iranians are extremely cautious within of the reasons that the north kor north koreans get warmer with south korea has do with the fact that the american president right now is totally unpredictable in the minds of

these players. >> is that a good thing? >> that's a positive aspect. >> maybe we can make a better deal, why stay in this awful deal -- and you say the iranians won't do anything because they're cautious and worried there may be a military answer to it. >> i see it as america is out of the deal, but the deal is still there. the point is that america doesn't consider the deal, it creates a new situation for european multinationals who understand it. the american final clout around the world makes the behavior of europeans and others trying to do business with iran more complicated, but some may find a way to do it that's not the real issue. the real issue is blocking iran from keeping developing missiles and doing other things we're doing our part we just hit significant factions

of iranians in syria the iranians, i should tell you, are suspicious with both sides the next step they might suspect is cautious waiting for the slightest mistake. they expect a strike on assets will worry them. more serious than what happens on the golan heights, that will lead them to become more cautious in the coming several months >> what do you think of some of the comments that prince mohammed bin salman has made with the united states he called the supreme leader as the equivalent of hitler and made some other comments that

might suggest -- >> i think hitler is unique enough to leave him aside. the iranians are bad enough without comparing them to hitler mbs impresses everyone with the scope of looking and vision, but he's only 31 years old, 32 years old. not highly experienced he's campaigning in yemen, and even the arrest of all the financial elite at the ritz carlton, it's something that looks like a great idea that evac rates over the next 30 days it doesn't seem that he still has the kind of controls i hope -- i'm encouraged by his attitude to israel, basically tells the emirates and others have a fresh look at the situation.

israel is not a part of the problem but a part of the solution but they cannot move forward without seeing israel moving forward on the palestinian issue. not bay they have a lot of favor with the palestinians, but because the public has, and they cannot feel safe in their own seats. >> he's a young man. things are happening there things are happening in saudi arabia he's a young man is it a fool's errand to hope the iranian regime, that the millennials in iran look around and there's an arab spring and this could force maybe the hand of that to happen more quickly or is that just errant to wait for things like that to happen >> if you look historically, however great the revolutions, they usually get more and more violent. usually the third generation, they collapse. it happened with the communist revolution -- >> is there hope for that?

>> the hope is for sure the ayatollah who won't be there in a generation from now, the question is whether it's three years or six years you cannot predict it. the society is very young. three generations there is shorter than in russia and that of france. >> mr. prime minister, thank you. good luck with the book. you saw it all, i'm sure it's a great read appreciate it. >> the disadvantage of age >> you look great. you look fantastic >> come back. when we return, why soybean farmers are worried about the fight between washington and beijing. stay tuned for that and more "squawk" returns in a moment

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all right. now let's get to global trade news a nightmare may be brewing for american soybean farmers eunice yoon reports on china's decision to change up some crops. these farms have gotten caught up in the trade war between the u.s. and china the chinese government is attempting to boost domestic

production of soybeans the authorities here in the country's northeast have been encouraging farmers to replace their corn crops with soybeans this corn farmer is being offered a subsidy of $162 per acre to make the switch. he has not taken it. soybeans are so cheap, he says you don't earn much growing them many farmers we spoke to here said the same thing. corn brings in double the profit of soybeans, and they don't have the right seeds and equipment to get good enough yields to compete with u.s. imports. if china increased the payout, farmers like lee said they would be keen to take up the trade fight. of course if we don't import u.s. soybeans, our beans in china can be sold at a higher price, he says we have fertile land here. how nice it would be if we could grow soybeans ourselves. a dream that could be seen as a nightmare for soybean farmers back in the u.s.

so even though the chinese government is throwing money at the problem, there are still limitations which will probably be good news for american soybean farmers who won't be so easily replaced. >> to watch all the -- because it's always volati volatile soybeans it's interesting to watch. and this is going to play in thank you. all right. coming up, oil prices rising this week on news that the u.s. is pulling out of the iran deal. the long-term implications for energy, that's next. at&t provides edge-to-edge intelligence, covering virtually every part of your retail business. so that if your customer needs shoes, & he's got wide feet. & with edge-to-edge intelligence you've got near real time inventory updates.

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welcome back to "squawk. oil prices rising after president trump's decision to get out of the iran deal joining us right now is tamar esner. >> morning >> tell us where oil prices will be two months from today >> higher. >> how much higher >> couple of dollars we think that what's driven oil up to $70 has largely been the fundamentals so i don't think we fully priced in the implications of the pulling out of the iran deal.

>> what are the implications in terms of price just a couple of dollars is that the premium? >> we have to see how the imposition plays out we don't think it'll be too much of an issue early. we don't think that china and europe will be fully cooperative. we're only expecting a reduction of about 200,000 barrels a day from the market. >> that's a best case scenario you're not factoring in any real sort of geopolitical risk. >> that's just in terms of the physical barrels of oil. then you have the geopolitical risk which is a separate topic in terms of chance for more direct conflict in the middle east and that can add, easily, a few dollars. >> do you think it is built into what's happened over the past couple months? >> i don't think so. i think in the last couple of months is the fundamental

backdrop is really constructive. demand around the world is going up and we've seen a decline in venezuelan production. so i don't think that the whole middle east is fully priced in yet. >> real quick for at least the last 12 if not 18 months there's been talk of aramco. they may not need to do it with these prices >> they need $88 to break even on their year. last year they got the number down to $70 a barrel so they're sitting pretty pretty right now. >> thank you for coming on this morning. >> thanks for having me. >> you bet when we come back, "squawk box" is in session senator toomey will talk tax, trade, drug prices, and more you're watching "squawk box" here on cnbc

the rally rolls on six straight days of gains and the market's looking to end the week on a positive note. we've got your portfolio covered. find out where you should be putting your money to work >> we are on washington watch. senator pat toomey joins us for the hour to talk trade, iran, north korea, and much more and don't forget mom >> mom mommy. mommy. momma. momma. momma. >> what! >> hi. >> find out what's back in stock this year as we get ready to celebrate moms everywhere as the second hour of "squawk box" begins right now ♪

live from the beating heart of business, this is "squawk box. >> good morning. welcome back to "squawk box" here on cnbc i'm andrew ross sorkin along with becky quick and joe kernen. take a look at equity futures on this friday morning. the dow would open up about 47.5 points higher. nasdaq 9 points and s&p up about 4 points the fed's going to be getting another measure of inflation they will issue figures at 8:30 eastern time this is seen as weaker than expected also barclays just daily has been fined $870,000 by british regulators

they say his actions fell short of what's expected for the ceo of a regulating company. shars of symantec is falling this morning after a report of unspecified issues i think what a lot of investors are concerned about is they suggest there could be a delay -- >> in some of their additional filings, existing filing based on some of these issues. down 24% for the stock right now. turning to washington, "the washington post" said it has obtained documents that show at&t paid michael cohen for advice on the merger with time warner >> good morning, becky the documents raise new questions about what exactly michael cohen was doing on behalf of at&t the documents include internal

at&t billing records and an invoice from michael cohen to the company. here's how "the washington post" is reporting it in their story which posted last night saying cohen's $600,000 agreement, three days after president trump was sworn into office the telecom giant at&t turned to his personal attorney michael cohen for help on a wide portfolio of issues including the proposed merger with time warner. according to those documents earlier in the week, at&t put out a memo to employees explaining all this. here's what at&t said about this in early 2017 we hired several consultants to help us understand how the president and his administration might approach a wide range of policy issues important to the company. so that's what he company says michael cohen was working on for

them still not entirely clear exactly how long this took place, exactly how much michael cohen was paid in total by the company. but we'll wait for further answers on that. meanwhile, the business of business in washington continues today with a couple of big events over at the white house later this morning, we're going to see automaker ceos meeting with the president at 11:45 at the white house and also at 2:00 in the afternoon the president's going to speak in the rose garden on his proposals to lower drug prices. our understanding of that is that we're going to see the president roll out a plan which would allow the government in some ways to negotiate more flexibly with drug companies but not allow medicare directly to negotiate with those drug companies. we'll wait on the details for that as well could be big nor pharmaceutical companies in the afternoon, guys >> thanks. just listening there, to see the details. the way sausage is made on k street to see the minutia of the

way it goes on only becomes interesting when it's a guy named michael cohen who in hindsight now has become a real interesting character. >> yeah. and at&t pointed that out in their statement. they said the headlines about him didn't surface until a year later. at the time of the president's election, they were struggling to understand this guy as he came in. very few people in washington or in new york expected trump to win. it was a surprise upset. so they weren't prepared for this and we should point out that previous administration officials have done this democrats and republicans who were afailuated with republicans to do consulting deals in the past it's not against any ethical standards or laws. we've seen it on both sides. >> the revolving door with government, you go through the

years -- i wonder where lobbying, if you rank it by industry it's got to be above pot it's one of the most lucrative -- >> they have lobbyists for lobbyists. >> are there lobbyists that lobby for lobby iss and lobby. >> yes >> we hear about the nra but everybody is paying for -- okay. >> here's the key thing to understand lobbying means it's having certain agendas in washington. consulting means i'm not necessarily contacting capitol hill and the white house i'm offering back advice to the company. i'm dealing with the company the consulting industry is unregulated. there's no disclosure forms for

that lobbyists have to file these reports. we can see who they're meeting with my guess is that industry is much bigger than the lobbying industry >> you've been around awhile i remember billy carter, i remember hugh rodham sets up these great companies down in, you know, in haiti. anyway, let's -- hence the name swamp. let's bring in -- thank you. and i wasn't referring to senator. >> hence the name swamp, let's bring in -- >> couldn't you at least say present company excluded, joe? >> present company excluded. senator pat toomey we're pleased and grateful you're here for an hour. whenever we have you on, you know, i try to get you to go places and you're very substantive and serious. we appreciate that because it's serious business. we're trying to help people that live in pennsylvania

at least that's what you're doing and live in the country. that's the point of all this why would you do it otherwise if. >> that's exactly right. one of the first things i learned when i was elected at congress is i'm pretty sure there is no human activity that does not have a trade association and a lobbying firm. >> that's probably right >> you know the lobbyists for the lobbies. >> i'm sure i have met them, yeah what about cable show anchor lobbying >> we don't have a -- >> come on you don't have an association? >> white house correspondents. that they've gotten such great press. >> i probably know some folks who'd like to work with you on that >> so nafta. this is just -- you know, on reading the newspapers every day. i thought because north korea is so important, the trump administration wants to do this nafta thing and quick. there's going to be a favorable outcome and lighthizer is going

to make it happen. you're writing editorials that leave out the possibility of us with this thing. >> my point today in "the wall street journal" piece is the administration does not have the unilateral authority to pull out. it's an agreement but it was made operative by legislation. 1993 congress passed the law, president signed it. that's what put nafta into effect the president doesn't have any more authority to repeal that law than he has the authority to repeal obamacare or change taxes. >> so how did we get to this point? where it looks like -- >> i'm hoping we don't get there, right what i'm hoping we get is negotiation of a better deal so there are things and i give a list of items where we could improve on nafta nafta was a pre-internet agreement. so we could have intellectual property the mexican threshold below which they don't imply -- apply

a tax on americans >> rules of origin >> so all of those things could change i'm not in favor of tightening rules of origin and making a domestic content requirements. that's contrary to nafta and having a free trade agreement. not in favor of a sunset provision. which has uncertainty about how long it's going to last. what i'm urging is don't negotiate a protectionist agreement and then threaten to pull out from the current agreement until republican pro-trade senators -- well, these are your choices this lesser nafta or nothing >> you're saying pulling out of nafta is basically illegal >> i think so. some are suggests they might try to do it anyway. i think they've got a fight on their hands if they try to do that without the consent of congress >> a fight from? >> congress. >> from congress >> right >> is that something you hear both from the house and senate or a small group of you talking about this >> on the senate side, it's become increasingly a topic of

discussion i have not discussed with my house colleagues again, i'm hoping it doesn't come to pass >> paul ryan is basically saying you've got to come up with something in the next week or -- >> we've got constraints based on the rules under which we operate on the timing of this. ideally we get the outline of a good construction agreement that doesn't move in a protectionist direction. and i think republican senators are pro-trade and pro-nafta. so the support would be there if it's a good agreement. >> have you spoken with the white house about this >> yeah. >> and their response has been >> they're thinking about it >> you won't get any democrats, will you >> very, very few. that's one of the other points i make any time our trade rep raises a protectionist idea and he has several of those, he'll get an attaboy from the anti-trade protectionist democrats. but they're not going to vote

for donald trump's nafta 2.0 they're just not i don't see it maybe a very few but ultimately this will rely on republicans in the house and the senate to pass this if they're going to do it and to do that, it ought to be an improvement on the existing deal not on the back track. >> when you talk to me in the white house, there's the sense there are two. how do you see that sort of playing out inside >> yeah, there is. there's a divide, right? at the white house, there are at least two camps on trade it's not always obvious which camp has the upper hand. i thought the steel and aluminum tariffs which is national security as the reason we had to impose taxes on the 20% of our consumers steel that we import it's a terrible idea but it was announced if you think about it the way i think about it, the bark was

worse than the bite. a lot of countries were excluded we're in a process taking too long i think that reflects that yin and yang going on. >> there's a lot of enemy of my enemy going on there just in terms of they're not going to support anything that trump does and i was thinking about the reason -- let's talk iran for a second the reason that president obama didn't go to congress was because there was bipartisan opposition to the bill bipartisan republicans and democrats both didn't want to do the iran treaty okay so now trump's trying to get out of it. and now there's bipartisan or at least on one side of the aisle there's -- they love -- even schumer suddenly loves the deal and wants to stay in because you can't possibly -- if you agree with trump, you can't go to your constituents and say i'm a

democrat with a straight face. >> it's become a real problem. because this is just playing out time and again in all different ways >> gina -- >> she was great they were all for brennan who almost certainly played some role in -- >> in the actual decisions to approve it >> and that's okay but gina haskell who was too junior at the time to have had that decision making power said she will comply with the law which now forbids those kind of techniques and she has no interest in changing the law yet they can't support her it's ridiculous. >> just on the point with the iran nuclear deal, we had ahou dba rack on. but now he doesn't want to see them pull out of it. that's his concern >> all right that raises the question, what's the effect, really, of the u.s. pulling out when the european

countries are staying in the fact is we're going to put much more economic pressure on iran than we would be if president trump had not made this decision. and i think that's a good thing. there's a lot of very, very bad behavior happening the iranian regime is still very dangerous, a serious threat to the region and the united states they are on a campaign in the middle east and i think we should be pushing back >> is that because of the other activities that they're doing outside of nuclear or is that because you think they are still continuing with nuclear and other terrorist activities >> it's both in the sense that with respect to the nuclear deal first of all it's the things that should have been in the deal and are not like the ability to test their missile technology that should have been covered. it was not that continues we don't know very much. what we learned from benjamin netanyahu without a shred of

doubt is they were systemically lying about their approach we knew that but now there's proof. we know they saved the documents that were the basis of their plans for nuclear weapons. we know there are military facilities we have not inspected and cannot inspect and then of course there's all the malign activity they're engaged in throughout the region >> senator, thanks for being here stick around we're going to talk a lot more after we -- i don't think there's lobbyists involved in our commercials. there's money. money makes the world go round i'm sorry. it's just a fact >> we're going to talk a little bit more of money with the senator in a bit coming up, futures indicated dow would be up about 38 points. s&p 500 up about three, nasdaq eight. we will talk markets and what's turning out to be a rally after the break. and the nation's automakers heading to the white house today. there's a live shot there for a

meeting with president trump we'll have a preview of what will be discussed. a bk 6sends. our phones are more than just phones.

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i don't think we even realized the rally is here. you're looking at me like i did. but it crept up on us. >> did on thursday >> fair way to describe it >> six straight days >> it has crept up on us if you look at the stock, i saw this morning it's up seven weeks in a row longest streak in over three years. our equivalent of the s&p 500. we have a couple things going on we have corporate results generally better than expected you say why isn't the market up 15% the reason is first quarter of 2019 earnings expected to gain only 6% to 7% a lot of this is going to be from a higher base as a result of the trump tax plan. we had a cpi report generally weaker than expected if you take out the energy, food, and the housing component on a month over month basis, cpi was actually down. that has dovish implications for the powell fed in their statement --

>> how much of this do you think is an interest rate move or lack of an interest rate move in terms of the move the market is making >> it's a combination of things. the interest rate move, the absolute absolute level is going to be different than the path that rates follow that is to say after we had the non-farm payroll report, the market was so emotional, rates spiked that's difficult for equity investors to hold onto but one that is more moderated and gradual can be a constructive one >> we talked about this last hour front page of "the wall street journal" buyback surge steadying market steady some people say artificially inflating. >> there's nothing artificial about it part of the trump tax plan, you've got increased corporate revenue. revenues are exceeding expectations 90% of the companies have reported in the s&p 500. they're exceeding expectations on the top line by about 75%

the bottom line as well by about 78%. we knew part of the trump tax plan where they reduce the corporate rate, that was a sale of the entire plan that you'll get increased buyback -- >> larry summers has been talking about there's a statute of limitations eventually on the call there's a 40% -- a 40% artificial -- i know, i know >> without the buybacks whether it's masking an economy that may not be as strong as the market would indicate >> and the fed inflating, moving its balance sheet to $4.5 trillion that the market was artificially inflated. and you'd be up to 2700. >> the senator has a question. >> there's a multiple. it's not the economy it's the multiple you assign to the earnings and to the economy.

>> i'm giving my time to the senator. >> thanks. my understanding is that the growth in buybacks and dividend increases has been swamped by the increases in capex at least among the big s&p companies. is that your understanding of the data and doesn't that suggest that we could have more sustained growth at elevated level? >> technology is about 25% of the s&p 500. in europe maybe it's a sector. it's about 5%. one of the things we learned from the 2000s tech boom bust is that technology companies are cyclical in nature and therefore they have a capex component. google and their earnings release talked about the capex component. investors were dismayed by it. i'd be heartened by it it's a bullish commentary on command. >> and the surge is capex is bigger than the surge in dividend increases and buybacks according to evs's data, anyway. >> even when corporate guys --

and they do buy back stock, but they do look at everything else they could be doing with the money. if they realize, you know -- and it's not artificial. it's got -- >> you've got an obligation to your shareholders. >> money flows downhill to where it's treated best. if it happens, it happens. >> i'm not saying all buybacks are terrible i'm suggesting one of the issues is there's an incentive, a personal motivation to buy back your own stock because you own the stock. you have to think about that >> okay. we got to go time now for today's aflac trivia question. what instruments did leo fender play the answer when cnbc "squawk box" continues thanks, dad! break a leg! aflac?! not that kind of break. oooh! that had to hurt.

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good morning and welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square among the stories front and center, wynn resorts continues to be at odds. that's good, right >> betting odds? >> yeah. the operator sent a letter to shareholders saying elaine wynn's campaign to remove board members is undercutting the effort -- wynn says they should be removed as the company tries to change out their culture. wynn herself is actually part of the old guard. >> she's not only the largest shareholder, she owns about 10% of the company so you're not talking about a one or two or three percent owner in this situation. >> she sat down with jim stewart in "the new york times" in vegas and goes through a whole litany of things wrong with the company and why she's doing what she's

doing. >> and it didn't stay in vegas >> it did not stay in vegas. it's worth a read because it gets right to the issue of what this whole fight is about. >> and to wrap this up, wynn's former ceo steve wynn shares something in common with ceos who received top pay in 2017 many of them are gone off the job. a study shows of last year's 20 highest paid ceos, 8 are no longer in the role that does include csx's hunter harrison who passedaway. while the others departed because of deteriorating financial performance or other issues martin one of those? sorrell? >> wpp >> i don't know. we said probably not or is it >> he was definitely one of the top paid >> yeah, he was. and shares of drop box, not lock box are lower in premarket

trading. it comes despite a beat on the top and bottom lines and dropbox's quarterly report had an ipo the stock has jumped about 10% this week ahead of that report >> president trump's decision to exit the iran deal sent shock waves through the international community. joining us right now to break out the fallout is director of the future of iran initiative at the atlantic council our guest today is pat toomey. barbara, thank you for joining us today >> thank you >> why don't you give us your assessment what it means with the united states pulling out of this deal. where does this leave with the european allies and in terms of what happens next? >> there's a lot of disastrous potential consequences one of the worst is this is really putting new strains on the transatlantic ie license if you look at the european newspapers this morning, there's

a lot of talk about repercussions in thoughts of trade wars, how europe should stand strong against the united states you may recall that britain, france, and germany made an earnest effort to try to keep the trump administration in the deal by offering new sanctions, new concessions. and it wasn't enough and president trump did what i think he always intended to do after basically toying with our european am lllies. >> look, this is something he campaigned on. if anything, it's taken him awhile to get to this. i don't know why it comes as a huge shock this is a deal that had very mixed review in america in the public and also with congress. this is not something congress ever voted on. i can't say it comes as a huge surprise >> the funny thing is the deal had gotten more popular over time a majority of americans when surveyed favored it. and said it was kbrt to have this than to have nothing. we're now in a situation where

once again the president of the united states has blown up an agreement without anything to replace it so iran could be unconstrained in terms of rebuilding its nuclear program. of course the economic implications are dire. we're already seeing the price of oil and gasoline go up. i think there are going to be major trade disputes now between the united states and europe >> senator toomey? >> barbara, pat toomey here. it doesn't strike me that economic consequences for the u.s. are going to be disastrous by any means not even clear that this has long-term implications for the price of oil if iranian oil finds it way to e the markets. and if it doesn't, probably a modest increase. my concern, the concern of many of my colleagues is the really dangerous behavior of iran before, during, and since the iran nuclear deal. we now have proof positive that they were, in fact, pursuing nuclear weapons. there are sites in iran that we

have no access to. they got a huge amount of money up front, why not put some pressure on their economy? >> i'm going to stop you there you know, i'm going to stop you there. we are going to lose the access we've had under this nuclear deal which has been extraordinary. >> i don't believe the aie has been to a military site since the agreement. >> they have been. there's never been a request they made that has been refused. netanyahu's report was not news to those of us who follow the issue. i think the inspection will go down, not up we're going to have more uncertainty. as we've already seen it's contributing to conflicts in the region, this is something that's going to get more frequent >> there was plenty of conflict in the region before this. >> i don't think it's going to change iran's posture. it may make them more aggressive >> i hope there will be pressure

on them to raise the rise of -- >> with all due respect -- >> -- in iran for the first time on the scale since 2009. and their currency is weakened dramatically -- >> so you think the regime's going to fall because of this? >> i don't know what's going to happen we're on a very bad path >> yes, we are and president trump has made it a lot rockier. >> i don't think so. >> senator, go ahead what was your point? >> i disagree, i'm sorry i disagree >> my point is we have to step up dramatically the pressure on this regime. and we don't have any good choices. it's a bad idea to release $100 billion to them on the promise they will behave well. they have not behaved well in fact, they've behaved worse and the deal allows them to have a short window for break up. >> let me ask you -- >> i disagree. >> there are people who have been very concerned with this along particularly what happens in ten years what goes back to that point also a lot of things that were included in this deal. the funding of terrorism around and beyond this.

i don't think anybody thought that this was a fantastic deal even the obama administration said the reason they were doing this deal which was not a great deal is they were worried the europeans would do it without them and they would be left behind >> i don't think that was the issue. look the point is we bought ourselves a lot of time and now we've thrown that time away. we bought ourselves an insurance policy and now president trump has shredded that insurance policy iran is going to continue to do all the things that we don't like in fact, this is going to strengthen more hard line elements in that country it's going to strengthen the military in that country and for what i mean, you know, the point is that president trump was actually winning because of the uncertainty he had put on this deal not that many european and other companies were going back into iran they weren't seeing huge benefits from it but now he's thrown away the leverage that the united states had to get anything more the europeans are not going to come back and talk to us about

more measures. the europeans are furious. yet this is another unnecessary crisis created by a reckless president. >> what do you think happens next >> i think the europeans are going to see what they can patch together how they can protect their investments and their trade with iran they're going to threaten to take the united states to the wto. they may threaten tariffs. reciprocal tariffs it's going to make our trade negotiations with them much harder and, you know, it's a time -- i mean, at some point the united states will need the good will of the rest of the world >> and korea is not what you're here to talk about but i'm dying to hear your take on north korea and, you know, whether you're going to call that reckless and somehow put a negative spin on what's happening in north korea. is that a land mine or a disaster waiting to happen as well in your view? >> i sincerely hope we're able to reach some sort of deal in north korea. north korea has 20 to 60 nuclear

weapons. iran has no nuclear weapons. or at least it didn't up until now. i hope that these talks go well, but, i have very little confidence, i have to say. i think the north koreans after seeing what has happened to this iran nuclear deal which may i remind you was blessed by the u.n. security council, unanimous support for this when north korea looks at what happened to the deal, they're going to demand a lot up front and perhaps a very slow process of denuclearization to make sure they can put their economy back on track before they really have to give up nuclear weapons >> i think this underscores if you're a fan of this deal which i am not, i never have been, you can see what a bad decision it was for president obama to ignore the bipartisan will of congress this wasn't an agreement between the united states and iran it was between president obama he knew that this should be a treaty brought to the senate,

chose not to do that because he knew it didn't have the support, and now he has to live with the consequences i actually think this is a constructive development because the behavior of iran -- we were just supposed to accept the status quo and continue to allow the aggression throughout that region the who knows -- >> aggression. who invaded iraq who invaded iraq who allowed iran to -- >> iran did that also. >> who invaded iraq? the united states overthrew a regime and gave -- >> and who's propping up a side and who is supporting hezbollah and arming them and who is importing all kinds of aggressive offensive technology to threaten israel and who is carrying on a proxy war against the saudis the iranians are on a track, their home is to have power in the region they hope to do it with nuclear weapons because they have preserved the infrastructure for that, this agreement allowed them to keep centrifuges

they've been attempting to buy equipment that is supposed to be precluded by this agreement. >> that's not true. >> yes, it is. >> look. we will have this conversation in a few months or years and we will see how well this decision worked out i can assure you that it's not going to improve iran's behavior as you call it it is a very, very reckless and ill considered move. >> barbara, thank you for your time today >> you're quite welcome. coming up when we return, the president is going to be meeting with automakers today at the white house. tax reform going to be dominating that conversation then on top of our 8:00 hour, the secretary of health and human services is going to join us to discuss the president's plan on drug pricing that conversation and a lot more when "squawk" returns. ♪ some moments can change everything. you can't always predict them, but you can game plan for them. for 150 years, generations of families

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auto company ceos are expected at the white house this morning. joining us now is paul ingrasia. there's a lot of interesting dynamics going on that you point out, paul. so we're going to talk all about these cafe standards it's just interestingly the

quandary that the automakers are in and you point out, why are we doing this we're exporting oil at this point. so the automakers should probably embrace the relaxation. but they can't do it because that means california is going to put in its own standards and they're worried about that so it's bizarre. the pickle that they're in >> well, exactly they really need -- the automakers really need consistency. and honestly, they would prefer to see the cafe standards roll back in their heart of hearts. although they don't want it to be portrayed that way. a larger issue, honestly as you just said, i think the case needs to be made at the public level by someone why we need cafe right now i mean, honestly we are exporting oil these days not importing oil anymore. and electric vehicles don't reduce co2 emissions, really what they do is change the

emissions to the source of the power plant. unless, of course, it's hydroelectric power or wind power. >> and then you got the diesel the green lobby loves deez seie. london's like l.a. with all the diesel cars. >> the european governments really pulled one over on their consumers and their people, honestly, by subsidizing on the interest of they get better gas mileage and you'll get less pollution and more conservation. what they forgot about is there's nox opposed to co2 co2 is global, nox is local. and there's tons of it in european cities. >> paul, can you speak to the issue -- because i think there has been even in the united states and maybe everyone has been sold a bill of goods when it comes to vehicles talking

about the teslas and everybody else building electric vehicles, this idea of lowering co2 in the at mor fear. that was part of the promise that musk and others made. you're suggesting that's a false promise. >> it's not entirely a false promise, it's just oversold. electricity has to be generated somewhere. unless it's generated by wind power or hydropower or steam power, in other words, if it is generated by fossil fuels, that still produces co2 emissions it might be less harmful to people if all that is done out in the desert, but the co2 problem is a global issue. it still goes into the atmosphere from the point of the power generation >> you feel good you feel a little better about it >> exactly >> and you convert the signal, drive around your neighborhood, wave you can have your carbon offset bumper sticker >> my understanding was there was an efficiency market

which is to say actually that putting it -- but taking wind and everything else aside that you're not driving big gasoline trucks around that's actually transporting the gasoline. that actually it is less i mean, that -- at least that's my understanding am i wrong about that? >> no. fuel efficiency is an issue for cafe, but again, the question is and i think someone needs to step forward and make the case for it in the modern day why do we need fuel efficiency when we're exporting oil other than we feel good about fuel efficiency. >> there are people who value that so they'll buy vehicles that have better miles and the folks that would rather have a big pickup truck, they'll buy it the late obama era rule that will just about triple the civil penalties on sales that are not compliant, that's outrageous punishment on people just exercising their choice in what kind of vehicle to drive

and i think congress ought to take a look at whether we can still undo that. i think there is a chance. >> well, you know, the honest -- the politically honest but politically unpalatable way to deal with this if you want to conserve petroleum -- and again, we are exporting petroleum right now. if you want to do that, use the timeline of economics and raise the gas tax. you know, people will respond to incentive. they'll consume less fuel. they'll switch to smaller cars but that's politically unpalatable. it just won't happen >> paul, you had a long career you were a journalist for a long time, weren't you? >> i still am, actually. >> that's what i thought but now you're able to speak you left your mainstream shackles behind. i've got toomey. i've got you i'm happy. anyway, paul ingrassia, your brother, we've got to work on

him too. >> no. he's one of the greats >> we got the good ingrassia today. >> he's a great brother, i'll put it that way. coming up we'll wrap up with senator toomey then later in the show, apple's march to $1 trillion after the stock touched highs. what will drive the stock to a trillion dollars and beyond? and do they get there before somebody else? we're going to find out. "squawk" returns in a moment xfinity x1 customers can vote, simply by saying,

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welcome back to "squawk box. we only have a couple of minutes here, final hang with senator pat toomey before you go, we got a couple of things. we want to talk about the midterms, what you think is going to happen? i've got to ask you about the michael cohen stuff. we've been talking about at&t all morning and lobbyists. what do you make of it >> i don't know what to make of it yet, honestly it's very surprising to me any big company would be paying a lot of money to a guy that's not obvious that he adds a lot of value to the discussion about the merger, for instance were they expecting to get some kind of entree what were they expecting i don't know we'll find out >> how often does that happen in your world did you ever have friends who then hung out a shingle after you got into a position of power? or people saying i'm trying to figure a way to get to pat

toomey, how do i do that >> you have staff members and work for certain firms they know people on the hill so that is part of the appeal. that's why they get hired. so that's not exactly the same thing, but that's close. >> what's going to happen in the midterms well, on the senate side >> there's mixed data on this. everybody focuses on the special elections which democrats have outperformed but some interesting anecdotes the ballots have tightened up. in ohio everybody thinks the democrats are all energized and not republicans. and we've got a lot of seat where is you have vulnerable incumbent democrats in states where donald trump is still popular. indiana, west virginia, north dakota, montana, missouri. and then we've got places where we've got great candidates running in florida you know, that's a real problem for the democrats to have rick

scott in this case pennsylvania could become competitive. in terms of vulnerable seats, dean hellerin is going to have a tough race he's doing everything right. he's been a good senator the open seat in arizona could be competitive, probably will be competitive. >> do you want to comment on what sounded like a terrible comment outside of the white house yesterday related to senator mccain >> i'm not aware of it >> it was on the news everywhere >> what's the comment? >> that there was a comment -- >> it was an unnamed white house person that said -- >> making fun of the senator saying he's dying so -- >> yeah. they're saying that his vote won't matter at some point it was a snickery, snide, horrific comment that was verbalized that you know that -- i mean, that's such a -- what do you mean all over the news >> it was all over the news. >> just the crazy stuff you come

up to ask that on the senator anyway -- >> great to see you. >> thanks for having me. >> thank you for joining us. when we come back, health and human services secretary alex azar on the plan for drug pricing. we'll hear more about that later. in the meantime, take a look at futures on this friday morning dow up about 38 points looking to seven straight positive days ts en ntinues.d we'll be right back.

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the market's winning streak. the dow on track for the longest stretch of gains in months 90 minutes to go until the opening bell on wall street. remember this? >> they're getting away with murder pharma pharma has a lot of lobbyists and a lot of power >> president trump set to lay out a plan to lower drug prices today in a speech hours away. ahs secretary alex azar will join us live as the final hour of "squawk box" starts now ♪ live from the most powerful

city in the world, new york, this is "squawk box. good morning and welcome back to "squawk box" here own cnbc live from the nasdaq market site in times square i'm joe kernen along with becky quick and andrew ross sorkin the futures now are up a little bit on the session after six straight days of gains up 43 on the dow nasdaq up 11, s&p up 4 10-year treasury back down this morning. the dollar is a little bit stronger little bit weaker, i'm sorry has been strengthening here's what's happening at this hour. in talk with investment banks about launching what's described as a bank check company. to pursue an acquisition

it is an attempt to diversify third point's revenue stream amazon making a deeper push into health care a document shows it created a team within its alexa health and wellness they may try to target aging and care and many new mothers and infan infants. apple has been spending a lot of money on health care as well, we think. "the washington post" says it has obtained documents from an anonymous source that showed they paid cohen $600,000 for its merger it's unclear what he provided to the telegram giant president trump's expected to lay out a plan to bring down drug prices this afternoon you're looking right now --

what's that big thing behind it? >> washington monument >> oh. thank you. bertha coombs joins us with more i knew that. i need to say that in this day and age, you need to say that. bertha, you have some stuff on the potential impact on pharma and especially, i think, on -- becky loves talking about pbms we've got to talk about them later. >> the middle men. >> yes it's got a bad connotation >> nobody wants to be called that the president's policy initiative is called american patients first and the aim to help medicare recipients like lilly dawson who takes multiple medications and sometimes has to choose between getting prescriptions and paying bills >> this month alone it's running

me close to $150 that's automatic everything has to be refilled. there's no getting around it >> so she's probably not going to pay her doctors this month and put that bill off. officials show four ways they'll target prices. to reduce the gaming of patents. also giving med tear plans more flexibility to negotiate prices. they didn't give many details on this, but they'll stop short of the government itself and will target list prices by limiting price increases to less than inflation for high cost drugs administered in physicians offices and cutting medicare part d cost sharing with out of pocket limits and requiring plans to pass on part of the rebates they get from drug makers a partial pass through is something pbms and the health insurers can manage.

they were spooked a week ago when there was rhetoric about perhaps eliminating those rebates all together calling them kickbacks so this is a much better scenario >> these are rebates that the drug companies give to the health care plan or pharmacy manager to say this is the real cost the list cost. you're paying below list cost. >> it's essentially the discount they give. they pass on 90% of those discounts to insurance companies. but these pbms when you look at cvs, scripps, and united health, they also have medicare part d plans. so they use some of that cash to offset and maintain low premiums larry merlo from cvs last week on the company's conference call

said what could happen here is cost shifting. it doesn't necessarily bring costs down for consumers it means you're going to pay from a different pocket. >> nefron research points out these guys, it does help their profits for cvs and express groups 601 16% of -- they look to shift that over to the premium pool again. >> nobody likes to be called the middle man but that's what you are. if you're taking 100% of a rebate and passing on 90% of it, you're sucking up that 10% is that the argument you negotiated that? >> they negotiated that and it's the thing the government can't do the negotiating the government wants to give more flexibility to get better outcomes the other thing to watch, though, is the whole issue about list prices.

in medicare part b, that is the part where if you get an infusion of chemotherapy, medicare there pays full list price plus a markup for the doctors. and that's where they want to try to get at the price increases. if you have to pay the full list price on ihleya, for example, which is to help with blindness. $2 billion was spent on that drug last year >> the hhs secretary is going to want to talk about this. >> it all has to be coordinated. it's like trying to shove a balloon into a box if you push on one side, it's going to come out of the other side you need to push gently to bring it smaller >> it's not a kidney biotech company. >> it is not >> nefron is all things kidney it's a research firm, the

function of the kidney separates waste from what is essential to life and they are separating waste from what is essential to -- >> they're trying to >> secretary azar is with us thank you, bertha. joins us now secretary alex azar i guess you heard most of that discussion. >> that was a pretty good discussion >> yeah. what are the salient point there is >> the president has promised he's going to put american patients first and drive down the -- what he's laying out this afternoon is going to be the most comprehensive plan to attack drug price affordability of any president in history. as you said, it's going to have four key elements. competition, negotiation, inc t incentives for lower list prices

and getting out of pocket prices and out of pocket costs for our senior citizens. over 50 different initiatives are part of this blueprint >> to either assign blame or to look at where to fix things, there's a lot to go around, i think. we pick on the pbms. you wonder why do you need middle men at all? what's the real role there then you worry about the pharmaceutical makers themselves with the way they sort of game the system to extend patent, you know, so they don't get generic competition. then you go to the foreign governments which basically, you know, they want us to import price controls and they don't develop any drugs on their own over there anymore there's problems all around. we have to deal with all these things >> we do it's a systemic problem of how all of the incentives are organized. every incentive is towards higher list prices, increasing list prices. and everybody benefits in this whole system except the patient

and the taxpayer and that's why we're going to be rolling out some really bold and creative ideas on how can we reverse those financial incentives for constant higher prices everybody is wetting their beak on a percent of list price, and we've got to change those dynami dynamics we've got examine and re-examine the roll of managers which have an important part but how do the -- and how are things structured in terms of that list price to net price dynamic those incentives are driving it. and the pharma companies, we're going to get after gaming and practices that harm the industry and keep us from establishing a similar competitive industry here this is going to be comprehensive, hard hitting, and across the board >> all of these sound like good ideas that are something where you can really get started on

trying to do something but none of it sounds like something that makes the system easier to navigate, easier to understand that offers a lot of transparency it still seems from the consumer's perspective, man, this is still a mess and you're not sure what you're going to be paying until after the fact >> so we're going to be addressing that. there are going to be elements of this to call for vastly greater transparency, information, and choice that put patients in the driver's seat so they're much more knowledgeable and armed to make smart choices along with their doctors and pharmacists and about the medicines they're going to get >> speak to that how do you do that in practice >> you're going to have to wait for 2:00 p.m. for that, but it's coming in the announcement a whole slate of plans on how we bring that kind of empowerment to patients, pharmacists, and doctors. >> hint at this. will we ever get to a point where we'll be, like, walking into a starbucks or a mcdonald's where you literally just look up at the board and you see the price? >> yes

>> that's great. >> it's not going to be tomorrow, but it's going to come the day is going to come when a doctor is sitting there -- here is what you'll pay out of pocket on your insurance plan for this drug, this drug, this drug all competitors and think about the relative merits, the clinical benefits but also what your out of pocket as the patient is under your precise drug plan >> one of the things you highlighted is one of the underlying causes in this country is other governments get a discount and we effectively underright the innovation of new drugs. how do you combat that >> so there are two ways we deal with that. the first is all of the initiatives that we're going to have on our side of the fence which is to negotiate, increase

competition, decrease list prices, reduce out of pocket we're overpaying pay less then on the foreign side, we need to throw our trade negotiations and agreements, pressure them so they pay more and so we should pay less, they should pay more. shouldn't be a one-way ratchet we all have some skin in this game >> it's weird because we can look around the world and see where market forces aren't at play we see the kind of economies and things that happen when it does occur. what happened in -- with drugs here it's got to be, you know, misplaced government policies that sort of dislocated the free market system. like everything else prior -- whatever you look at, things should be drimpb down. it's not what is holding back the market forces from all of health care and asserting down pressure on things >> i think you're absolutely

right. we should always first look to see if the government has gotten in the way of any of this. are we, for instance, are part d these retail drug programs when they were invented back 15 years ago, they were novel and cutting edge they were the best at controlling cost now the private sector has actually in the last sector gotten even better than we are in terms of negotiating. we need to unleash those part d drug plans with even more tools to keep them up-to-date with the private sector now, over abroad, the reason they're getting in some cases, not always, is their socialized systems. and their rationing care you know, god help you if you get cancer in some of these countries. so the president's plan is how do we bring affordability? but how do we do so with private sector competition and still

retain patient and the incentives for innovation for this golden age of new care and pharmaceuticals. it's a nuanced, sophisticated, balanced approach. it's what you'd expect from a ceo and businessman like donald tru trump. >> we should have an algorithm for the exact amount of time for a patent protection that maximizes the, you know, a company that takes and spends a lot of money they get to recoup their investment is 12 years, whatever it is, is it the right number we have right now? >> that's why we're going to get after this there's a deal in our statute. there's a deal in the biosimilar legislation. it says you get the exclusive right to practice this molecule and this patent up to this date. and at that point, it ought to be to the door, full

competition. stop the gamesmanship version. >> and spend all your money marketing that on "nightly news." >> that's right. >> although it takes most of the commercial to go over the site effects. i'm not taking any of those. what i have is not as bad as what you're telling me i'm going to get with all that stuff i mean -- anyway, mr. secretary thank you. >> thank you >> we mohope to see you again. bertha, did a lot of homework on this stuff, didn't you >> little bit. >> it's her beat she knows it well. >> there you go. that explains it >> thank you when we come back, another big event at the white house today president trump will be lining up -- faed faambassadoraa hills will be here we'll be right back.

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welcome back to "squawk box," everybody. as we've told you about one big event happening at the white house today, president trump's pharma speech. before that, though, president trump's going to be holding a summit with auto ceos today. they shall expected to talk

about planned fuel efficiency rule changes that's coming up at 11:45 a.m. eastern time concerns over u.s. auto proposals holding up nafta negotiations before the trump imposed deadline joining us now is carla hills. she is the former u.s. trade representative under george h.w. bush thank you for being here today >> pleasure to join you. >> yesterday paul ryan saying congress needs paperwork on this the paper work from the u.s. trade representative by next week, may 17th, in order for congress to vote on it in this session. how tight are we against this? what do you think the odds are something gets put together before then? >> a trade promotion authority requires that before the president signs an agreement, it must give the congress 90 days notice it must put the agreement out for publication on its web at 60

days the international trade commission must also put out a report so speaker ryan is accurate to say that if you want this congress to address the issue, the time is running out. >> and what do you think happens under these strict deadlines >> i didn't get your question. >> what do you think happens that's a very tight leddeadline do you think something can be pulled together with these talks? >> i'm not at the negotiating table. either they will be able to bridge their differences or they will continue to negotiate and perhaps deal with in 2019 with the new congress >> we were joined by senator pat toomey he's got an op-ed in "the wall street journal" this morning

that he thinks the idea of pulling out of nafta was not an option for the president he thinks it's illegal because of the way nafta was approved. your thoughts on this? >> we have a divided government. and the president has the vp power to negotiate with foreign leaders. and the power over taxes, tariffs, and commercial matters. and this is not a treaty this is an agreement legislation was passed to prove the agreement. and so there are factors in the agreement that the president doesn't have power over. there'll be an upset if we're not able to keep it. but more importantly, we ought to find a way to keep the agreement. the north american free trade agreement is responsible for 14 million jobs in the united states and we would be badly hurt if we

lost it. >> ambassador, want to thank you for your time today. ambassador hills >> thank you coming up in the next half hour, can you guess this chart take a look at this. here is a hint it is inching closer to a big milestone. you can tweet us your guess. >> i know what it is >> you can do it @squawkcnbc >> everybody knows what it is. >> don't say a word. >> everybody but you knows what it is. >> gave away a huge clue it's approaching a big milestone. >> it's trading at $185 and people know what it is >> we will have a live report when we return

coming up when we return, a live report from the cme trading floor. we'll check in with rick santelli plus why some farmers may be seeing e-i-e-i-robot >> good morning to you there's a big conference going on the tech front robots conference here one of the big themes, robots in agriculture. we'll see all the cool stuff from robots picking fruit off trees, even handling eggs. all that video coming up aturall, causing a lack of sharpness, or even trouble with recall. thankfully, the breakthrough in prevagen helps your brain

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from april figures for import and export prices. the futures right now as you can see are up 20 or so on the dow those aren't the best levels of the session now. but up a little. green across the board nasdaq up 3.70. rick standing by with the numbers. rick >> yes april import prices. up 0.3%-expetroleum up 0.1%. both of those cooler than expected we were looking for up 0.5%, up 0.2% on ex-petroleum. if we look at year over year import prices, they were 3.3% higher and export prices, month over month headline 0.6%, up 0.6%. almost double the expectations export prices year every yore another 3.8% let's look at those year over year they follow a revised 3.6% that

now is 3.3%. from that vantage point, it's a lateral move, but it was a downgrade. 3.8% follows an unrefiezed 3.4%. so from a wider perspective, prices seem to be a little bit more aggressive. markets don't seem to be moving much on it the dollar index has been slowly giving up some of its gains. settle above 93. we're now closer to 92.5 and if there's a retest, that's a level you want to pay close attention to rates? well, i couldn't have it an easier way to frame this we're at 296 last friday we were at a 296 close. unchanged on the day, on the week and the handle close we had still didn't surmount the 3.03% high yield close from february

and to many traders, that's the key if there's going to be more upside to rates. andrew, back to you. >> thank you, rick great to see you we're going to get to the other side of the country now. forget old macdonald had a farm. aditi roy is going to explain why old macdonald might have a robot. >> that's right. it's a whole new world between robots and agriculture and the use of automation on the farm. it's one of the big themes today at the robotics conference later on on campus one of the big companies in agriculture -- and they're testing out this robotic strawberry picker. it picks the fruit without bruising it which is critical to getting it into your home. that's where soft robots comes in as well that's a whole industry as well. the company is based in cambridge, massachusetts look at that it uses its robotic hands.

look at the blue hands there to pick tomatoes off trees, pack eggs into cartons and chicken breasts into packages. finally john deere is also investing heavily into technology its combines and tractors are highly automated the machines also have built-in sensors to track the conditions as they go over the field. that allows the machines to better put down herbicide or fertilizer they also opened up new offices in san francisco where they are hiring software engineers. that happened last year. and they also acquired blue river technology last year which is an ag tech start-up they're big on innovation. >> one of the things we were watching as you were talking about were robotic hands picking up peeps if you want to know how gentle these things, it's not breaking the peeps or pushing through anything one more question. with deere talking about how it can save farmers thousands, is

it using less in pesticides or something else goes into it? >> partly yes, they're using less product there's savings there. and they're optimizing everything certain terrain here is different than the field there in real time, they're opted the most out of their resources to make sure the yields are maximized in those cases >> okay. aditi, thank you for that. meantime, the light forum wrapped up in palo alto this week joinings us now is the roam ceo and sponsor of the event help us understand what the conversation was more specifically, what does roam do? >> it's an artificial

intelligence platform that looks at health care what we do is merge vast amounts of patient data out there to help you understand how to get the right drug to the right patient at the right time. is the idea is how do you bring it together to see how patients progress through a disease and make sure you're paying for a value and getting the right treatments to the right patient at the right time. >> where are you collecting this data from? >> one of the biggest misunderstanding about health care is there's a huge shortage of data. in truth, the data is widely available, it's just none of it talks to each other. for example, under obamacare, an enormous amount of data has become available from the federal government on top of that, every health care system has health records, has structured data from claims that happened from insurance payments and so forth. the problem is if you look at

any hospital system, even if it has an electronic health record system, none of which talk to each other how do you integrate and bring it together. on top of that as our clients say, the problem in health care what makes it unique is 80% of the value comes from the unstructured data, the notes about patient/doctor interactions nobody has figured out how to work with those to scale that we believe we have with a platform that does that >> how much of this is being built for the doctor and how much for the consumer? you know, apple has now teamed up with athena health and other to be able to see some of this on your phone. but we're not there yet. >> so there's two problems with consumer data. unfortunately collected data from those who need the help the least. if you are healthy and use a fitbit the problems are centered on people going to hospitals, have

chronic diseases, and so forth the problem with a lot of the things apple is trying to do and others is if i want to get my health records, i go to so many doctors in different facilities. it's hard to get a comprehensive view the people who have the interesting data are the individual providers that i visit as a patient and of course the big integrated insurance players like optimum and united health. >> and who do you want collecting all of that in one place? the consumer or the insurance company on behalf of the consumer or the hospital? >> so from our perspective -- that's a great question. from our perspective as roam, we're agnostic of where the data lies clearly the patient should own the data as the company we think about once we think of the particular patient and that patient wants to get healthier, how can we make that easier for that patient and the health care system treating him?

who owns the data is a debate that's larger than us. comes back to privacy concerns and so forth >> you know, becky and i were in omaha over the weekend one of the conversations that i kept hearing in the hallway was berkshire getting together with amazon, gotting together with jpmorgan in terms of what that ultimately would look like. oftentimes the conversation was if you could take big data and all the data of those employees, you could do something remarkable at least that's the promise. we haven't gotten a lot of detail about what that would look like. be if you were running it, what would you do >> what i would say is the things they're going to do is going to be interesting but non-transformative chances are they're going to think about what they can do for a large population of the people they employ to pay less for costs. one of e the things we discussed was about how artificial intelligence can actually transform and leapfrog where we're at and the consensus was that the two things that had to happen is number one, you obviously had to get access to the data i talked

about earlier. even more interesting was how can we leapfrog the system all together why are we not getting far more information about what the patient is actually feeling and experiencing without wasting hours of a doctor's time writing that into an electronic system why are we not using telemedicine more effectively which is probably the thing that's necessary for most doctor visits and using all of the data exhausted from that to make sure we understand how a patient should progress through a disease. so a lot of the things people talk about that are interesting and transformative tend to be marginal and things that can really change health care are really using that >> we got to run, but i have one major question and it's a privacy/motivation incentive question i've heard about this idea of literally recording audio and possibly video of a patient/doctor interaction meaning you go for your checkup or whatever appointment you have and it's recorded. the ai is then literally reading

the transport effectively of that entire session. as you said, structuring that data for later who wants that and who doesn't want it? because it creates all sorts of issues by the way, probably for the patient and also for the doctor. >> i think the person who really wants this is the patient. the other thing that if you record those conversations it's yaed to do the most logical thing from a logic perspective and give that data to the patient. then you can plug it into an app i own on my phone and the data is as i've seen fit. if we want to avoid going bankrupt, we need to do creative things to make sure patients particularly those with bad insurance policies or less income can afford what they need this gets us there >> alex, thank you

great to see you >> thank you for having me >> good luck in the last half hour we asked you to guess this chart. then one person said that's my blood pressure when we get one of those trademark got ya questions to some random republican about some low level staffer in the white house that's how my blood pressure goes up to that's my blood pressure that goes up. anyway, no it's apple here is the answer that's the shares of apple it's inching closer to $1 trillion for a market cap. josh lipton is tracking this story and josh, that's a nice chart. what do you have coming up that's a nice beard too. >> thank you, joe. so since may 1st, april stock is up 12%, joe. far out-pacing the s&p spds. it gets it to $1 trillion market cap and yobend we're going to talk about it when "squawk box" returns.

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welcome back, everybody. nvidia reporting quarterly profit of $2.05 a share. however, the chip maker's stock falling in the premarket trading today following lower than expected profit in the company's data center business that stock is down by about 2% maybe we can ask cramer about that also shares of verizon higher in the premarket. the stock was upgraded to overweight from neutral at jpmorgan jpmorgan says they have

opportunities involving 5g technology that will crystallize over the next few months then kohl's was downgraded to neutral at credit suisse it says the momentum may be stalled by the cold weather that impacted many retailers during the first quarter. that stock is off by 2%. apple stock price and market cap both touching new highs. josh lipton has more on what could drive apple to the $1 trillion market cap and beyond and also maybe what holds it back and that is every time you buy back $100 billion worth of stock, that comes up on the cap. >> that is right, joe. let's talk about this march toward a trillion dollars. apple needs to hit $203.45 to reach that milestone that's a jump of about 7% from these levels since apple reported on may 1st, the stock is up 12%. warren buffett told you guys just a few weeks back that

berkshire added more apple shares his confidence in the company providing support. so what is going to push apple to that milestone? in the near term, investors are focused on what ceo tim cook is going to unveil in the fall. gene munster is also counting on an iphone business becoming more stable albeit at a lower growth rate flat to up 5%, he says, giving investors greater visibility into the franchise off that base, we know apple can keep selling a lot of services remember, services revenue did jump a surprising 31% in q2 and outsize capital returned by munster's math apple can generate $50 billion in free cash flow. which will go back to shareholders through buybacks and dividends. not everyone is a fan. nearly 40% of analysts rate apple a hold right now one of his big worries,

skepticism that apple can keep raises prices. becky? >> josh, thank you very much the idea of buybacks going to make that harder to meet depending on when they engage in the supposed $100 billion of buybacks they might be taking. josh lipton, thank you when we come back this morning, we are counting down to the opening bell on wall street. we're going to find out what jim cramer is watching today by the way, futures this morning, looks like the dow is up about 18 points s&p futures up by one. the nasdaq off by m 5.5 we'll be right back because, when you really, really want to be there, but you can't. at cognizant,

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♪ get down to the new york stock exchange jim cramer joins us now this morning. weekend's coming, jim. kind of what i'm thinking about. you're always focused on the

issues of the day. what -- are there individual names we should be paying attention to that are at some crucial levels here? nvidia is that your dog's name or you always show your dog >> it is indeed my dog's name. nvidia was a great quarter, but unfortunately, i predicted that the cryptoids would color things they told you cryptocurrency would go down. they said it and everyone's freaking out some people saying the data center wasn't strong i got to tell you, data center, they sold everything they could sell i don't know how you make it stronger the next iteration chip is going to be -- more people are going to buy it. it was crypto that knocked it down i still tell people, look, they told it, it did, and if you're going to sell it down on that, give me a break. i think ultimately the stock will not finish up today and not finish up next week, but it is going hard

>> what are your odds on a trillion for apple they came down from 10/1 what are the odds now, 3/1 >> i know josh was talking about my good friend saying maybe the best days are behind it, but this is all service street they team up with goldman on a credit card, but the service stream is unbelievable it's like netflix, it's like spotify. it really does -- like costco card and prime you have to pay it you don't even look at your bill you say, oh, okay. you just pay it. i think apple, yes, is now once again favored to justifiably -- >> i didn't understand why go back? i thought you could use your phone as the credit card why do you need a credit card? seems like you're going backwards. like you're brick and mortar >> plastic will be gone within the next couple years. >> what i didn't understand about that was how much they're going to end up having to pay. >> how is it different than what

you do now with an apple pay >> well, no, no. but part of it there has to be a bank on the back end of it because there's also a credit card element. >> so what were they using here to for >> how much do you think goldman is going to have to pay for the privilege to have this card and to be in partnership with apple? that's a real issue. if you look at how so many of these banks have done these deals, oftentimes the early big deals to get into the marketplace, some of the early jpmorgan deals and others almost lost leaders >> you're totally right. look at the citi/costco. it was american express. then citi/costco cost citi a lot up front but turned out to be great. when i worked at goldman, you would have said, are you kidding me that's the most retail thing in the world. retail being something you didn't want to be. but this is one of the great

pieces of business out there worldwide piece of business. >> yeah, all right all right, jim i know you got another -- yeah, you're not done until later. >> no. ton to do. >> i'm going to say good-bye to you. see you in a couple minutes. up next, the boston dynamics robot atlas learned a new skill. we're going to show you. a robot. ne we'll be right back. oven themseg one of the most rigorous exams in the world. demand the best. demand a cfa charterholder. cfa institute. let's measure up. kevin, meet yourkeviner. kevin kevin kevin kevin kevin kevin kevin

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well, if you skipped the gym this week, this story will make you feel a little guiltier boston dynamics releasing video of its robot atlas going for a jog. the incomplete list of things boston dynamics' robots can do if it makes you feel like a slacker, sit up and pay attention. that's pretty good >> it's amazing. although, i think i might be a little better. >> think about what it's capable of doing it's just unbelievable it really is boston dynamics, by the way,

once previously owned by google. they sold the company. separately in tech news, do you remember the company klout it was a hot start-up that measured how important people are on social media. it's now shutting down klout was bought for $200 million in 2014. so maybe its own influence wasn't that influential. check out shares of facebook this morning the stock has now recovered all of its losses following the cambridge analytica scandal. it's about $185.20 also, we should tell you, i don't know if you saw this news, guys, some very harsh words from mark zuckerberg. the chief investment officer of the california state teachers retirement system says zuckerberg's control of facebook is like a dictatorship he made those comments on cnbc's "closing bell. >> and elon musk is at it again. this time he says he can solve the problem of l.a. traffic. that might be easier -- to get

to mars would be easier than that check out this time-lapse video posted on his instagram account last night it shows the first leg of the boring company's underground tunnel in los angeles. m musk writes, the tunnel is almost done and will be offering free rides >> think about how many of those you have to build. >> to make a difference. >> to make it actually work. >> a lot of them -- moving a lot of earth >> you have to do like thousands of those >> i am curious to see the results, like if people drive on to it, how it works, how you get down there >> we may have shown the video in the very futuristic world, you drive up on the sidewalk there would be almost an elevator that drops your car down on. then your car goes off like it's on a roller coaster. and you somehow have to program into it where you're going because it's going to go in different places

shoots you to the place. then your elevator would come back up. >> so still a while. >> much easier to go above and fly, except you'll likely die. down there, you got to drill a lot of tunnels, but you might live but i don't know >> there are also, by the way, issues about tunnels themselves. how many tunnels you have on top of each other. you'll have to have thousands of them >> think about fracking. >> maybe they know on "squawk on the street" because that's where we're going. make sure you join us on monday. here's "squawk on the street." ♪ good friday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber at the new york stock exchange. s&p is on track for the best weekly gain in a couple months a lot headed our way this morning. a white house meeting with