it's 5:00 a.m. on the east coast. very far apart, that's how the u.s. ambassador to china describes the trade talks. seattle approving a big new tax on big business, including on the city's largest employers, starbucks and amazon. the driver of a tesla that crashed into a fire truck says the vehicle was on autopilot at the time of the collision. more evacuations ordered in hawaii. and sotheby's setting a new record for the most expensive painting ever sold we'll show that you big number

ahead on this tuesday, may 15th as "worldwide exchange" begins right now. ♪ good morning welcome from wherever in the world you may be watching. i'm brian sullivan do not look now, but we are in the middle of the longest winning streak for the dow jones in six months. if you're keeping score at home, we gained eight sessions in a row heading into this morning. nine may be tougher because futures indicating that we'll be down a bit very early we're down 59. an eight-day winning streak could be in jeopardy today what's not down is the yield on the ten-year, that's back slightly above 3%. 3.01%. oil remains a huge story brent crude, which is traded overseas, creeping back towards $80 a barrel we're at 78.47

oil traded here back above 71 a barrel gasoline on the rise, up nearly 40% in just one year more on oil all day tomorrow here on cnbc we'll tell you why in a bit. more on that and the overall check on your investments with sam stovall from cfra here's what's interesting, we're up eight days in a row on the dow. earnings have been nothing short of spectacular, yet year to date we're only flat on the equity markets. how do we read that? >> what investors are trying to do is find reasons to discount the move that we've seen most recently a lot of investors have become technicians recently trying to decide a continuation pattern after having broken above that descending triangle. i think investors are looking to interest rates, looking to earnings, saying it's a peak in

earnings, time to get out. looking at interest rates above 3% looking for reasons to worry >> why can't we just be optimistic you're paid to worry why are investors not reacting more positively to the positive news we've been in this bull market for nine plus years. give us a couple more years. it is the second most expensive since world war ii and so i think investors, i've always said, are no better than first graders playing musical chairs and trying to anticipate when the music will stop >> we're supposed to buy now or sell now for six to nine to 12 months down the road by doing this, are investors saying earnings growth is going to slow down the growth will slow down. estimates show a 20% gain for

all of 2018, an 800 basis point improvement from where we thought earnings would be at the start of 2018. heading into 2019 we're still looking for a 10% gain so going back to world war ii, when we have seen a peak in earnings, the market has continued to rise in the coming nine-month period on average >> the earnings growth outlook is still strong. investors are not reacting as they did 6 to 9 months ago when they were ostensibly buying for now. is it because other things maybe look more attractive maybe it's not a reflection of the stock market as it is other things look better >> there's not a lot of other things that look better. yes, we're seeing an improvement in commodities oil prices averaging above $70 a barrel, expectations continue to be ratcheted higher for this year and for next year so we are seeing an improvement in the commodity space in general in the basic material connector in particular.

when it comes to fixed income, not a lot of attractiveness yet. >> 3% is not attractive? 3% by itself is not interesting. 3% on the ten-year, when you made a lot of money in equities may look better. if you're greedy, you may take it behind the woodshed >> it may look better, but when you look to the normal relationship between inflation and rates, the yield on the note should be closer to 4.5% so the question is what is the direction of interest rates. as our economists are looking, the direction is higher. yet we're still in a stimulative environment. a net negative real rate environment because interest rates are below inflation which basically stimulates economic growth >> i know you love your history, i love that about you.

if the ten-year got to 4%. we could say we have gone up 400 basis points since the lows of zero percent, but 4% over 100 years is still low how do we read it? is 4% death for equities or is it okay? >> the line in the sand is 6%. >> that's the magic line >> it is beyond that the average monthly price change has been negative before that, it is positive but on a descending slope. so, essentially, y tshgs yes, tr we go in interest rates the more substitution rates take place. the greater pressure on corporate earnings really we don't go negative until we hit a number higher than where we are now. >> we wanted to be the first show to say 4% at "worldwide exchange," we want to be first with the 4%. sam stoval, fear not

thank you. tesla shares down again. the driver of a model s that rear-ended a fire truck over the weekend says the car was in autopilot mode at the time of the collision. utah police say the driver was looking down at her phone at the time of the crash. elon musk has not taken the publicity lightly. he said it is super messed up that a tesla crash that resulted in a broken ankle is front page news and the 40,000 people who died in the u.s. accidents in the past year get no coverage. he has a point investigators say they're working with tesla to gather data stored in the crashed vehicle. switch is a data center company, shares hit and it projects revenue this quarter to slightly beat estimates. since that ipo in october, switch down more than 30%. agilent, the lab equipment

company guidance falling short of estimates serl the stock is down more than 7%. completing the trifecta of trouble, vip shop, it's a china-based online retailer. shares slammed, down 15% now, nearly 16% first quarter earnings missed forecasts. we are following a developing story out of the middle east. the white house is blaming hamas for the death of dozens of palestinians along the gaza border yesterday israeli troops shot dead more than 50 palestinians in gaza as the u.s. opened its embassy in jerusalem. it was the single bloodiest day for palestinians since 2014. let's go to matt bradley live in gaza city. matt >> thanks, brian what we're seeing today is really recovery from yesterday it was more than 56 people who were killed. thousands were injured one of those dead was an

8-month-old girl who died from suffocation due to the tear gas fired by israeli troops on the other side of that border. what i saw was tens of thousands of mostly young palestinians trying to cross over the border, really with very few weapons or light weapons. mostly sling shots, burning tires. they were met with israeli sniper fire and later on artillery shells now today we're seeing recovery. we're seeing what looks like thousands of people seeking medical care that's a very difficult proposition in this very blockaded small palestinian enclave. this place has been under blockade for the past ten years, both by israel around the northern and eastern parts and egypt to the southwest we're still waiting to hear whether these people will be seeing medical attention it's too early today to see whether or not there will be massive protests again like yesterday. so far things along the border seem to be fairly quiet.

it seems hamas may be reaching some sort of deal with the israeli government to diminish those protests, to try to quell the more casualty and higher death toll today today is nakba day that means catastrophe. that's when palestinians and arabs throughout the world remember the 70th anniversary of the founding of the state of israel we can expect some protest, if not here in gaza then elsewhere throughout the west bank or the arab and muslim world. brian? >> matt, thank you. we're following a developing story out of iraq where an anti-u.s. militant cleric has won elections. hadley gamble has more on that good morning so this is a story that may have major implications for opec's second largest producer. in iraq you have a man who at one point was ordering his militias to fire on american troops, he is a shia cleric and

seems to have been picking up most of the votes in this election many thought this election would be handed over to the prime minister of iraq, a man who worked closely with america when it came to defeating the islamic state. iraq producing millions of barrels of oil a day so concerns over what this means for that area. he managed to convince international donors over the past several months to commit money to international infrastructure projects in iraq. a lot of questions over what will happen next and serious implications for the country >> hadley gamble, thank you. a lot of news, we are just getting started on "worldwide exchange." on deck, we are taxing tech. the big move seattle made that amazon calls disappointing.

and can you guess this stock? it's the single worst performer in the s&p 500 this year down nearly 45%. don't keep it a secret tweet us and we'll give you the answer in today's rbi as "wex" rolls on or discover magic when you hit the open road. with the free audible app, your stories go wherever you do. and for just $14.95 a month you get a credit, good for any audiobook. if you don't like it exchange it any time. no questions asked. you can also roll your credits to the next month if you don't use them. so take audible with you this summer... on the road... on the trail... or to the beach. start a 30-day trial and your first audiobook is free.

cancel anytime, and your books are yours to keep forever. no matter where you go this summer make it better with audible. text summer4 to 500500 to start listening today.

sure. mom,what's up son?alk? i can't be your it guy anymore. what? you guys have xfinity. you can do this. what's a good wifi password, mom? you still have to visit us. i will. no. make that the password: "you_stillóhave_toóvisit_us." that's a good one. [ chuckles ] download the xfinity my account app and set a password you can easily remember. one more way comcast is working to fit into your life, not the other way around. . big interview later today on cnbc verizon's ceo, lowell mcadam

sitting down to talk with cnbc to talk about 5g as well as the print merger there's a big new tax in the pacific northwest. seattle approving a tax for the biggest companies like amazon and starbucks. kate rogers joins us with more on this. good morning the city council approved the new tax yesterday to address a housing crisis partly attributed to a boom in the local economy which has driven up real estate prices the measure would apply to companies that gross more than $20 million a year imposing a tax of $500 per employee it's designed to raise $50 million a year, down from $75 million to support more affordable housing and services. supporters say the biggest earning companies such as amazon should bear some burden for easing the shortage in low income housing they helped to create amazon led opposition to the tax earlier this month saying it would freeze plans to expand in

seattle putting more than 7,000 jobs in question after the vote amazon said it would go ahead with plans for a major downtown office building but they say we're apprehensive about the future created by the council's hostile approach and rhetoric towards larger businesses, which forces us to question our growth here >> are there any questions on changing plans and leaving >> amazon said they may not build this downtown office complex, they are going ahead with it, but the article says there are nearly 12,000 homeless people in seattle. >> let's not forget, amazon is looking for hq2, a second headquarters >> they'll argue we create so many jobs down here. why should we be subject to

this you can see the argument on both sides. >> you wonder if seattle will be the leader in all of this. >> san francisco, right? >> yes joining us is the economic policy analyst at the american enterprise institute we wanted to bring you on, jimmy, to talk about apple, facebook and tim cook. i have to start off with this. what do you make of seattle's move >> is this their secret plan to turn hq2 into hq1. there was already talk that the new amazon headquarters would de facto become the main hq i think this makes that more likely if these cities, seattle and san francisco are worried about the impact on housing, to go about it by creating a tax on these companies, created more affordable housing, rather than letting more affordable housing be built with much loser land use regulation t seems like a

strange way to go about it >> it is it looks like they're try going about it in a back doorway, which is we'll tax you, which may stifle growth or force people to leave, then those leaving people will open up apartments, but if you're filling those apartments with people who cannot afford house ing, that does not match up unless rents dramatically drop that will not happen >> this is a problem a lot of cities have bid to have. again, if seattle thinks that amazon is stuck there and doesn't have other options when they're in realtime finding another place, i'm not sure they really understand the word leverage >> now let's get back to the issue of apple and facebook. over the weekend at duke university, tim cook coming out again, i would say duking it out and taking jabs at facebook and google talking about how his

company, apple, is not -- they're not going to sell your data, your data belongs to you companies effectively should not make money, if you will, off that data. i found the venue odd for that conversation what do you make of apple's privacy offensive against some of its silicon valley brethren >> apple is putting prooifr cpr there as a selling point they are constantly in a cat and mouse game with authorities about make the iphones tough for law enforcement to access. i think tim cook maybe more than any other big tech ceo understands his role as kind of a spokesman also for the industry with washington thinking more about regulation, having a high profile serious adult tech ceo

making it clear that i'm not cavalier about privacy there are tech companies that are not cavalier about privacy we care. that's pretty important for that political public aspect. >> is it smart will it work >> i think it's super helpful that people in washington don't get the idea that silicon valley, they don't care about privacy. remember, this is all happening against the backdrop of this emerging digital cold war with china where the biggest target perhaps is apple which sells billions of dollars of phone in china if that trade war heats up, apple could be a potential target and it will need washington to have its back. >> here's the bottom line, do you think people will go into an apple store and think i'm going to buy apple products because i believe in or admire their stance on privacy. will it help the company or is it just talk >> i think incrementally at the

margin it's good for the brand my baseline position is that people don't care that much about privacy as long as you're not accessing their bank account. i think it's an activist and politician issue than a general issue. >> a man with seven children, you look surprisingly awake at 5:00 in the morning. >> it's my special magic, thanks. on deck, contentious trade talks with china kicking off today in d.c could a middle ground be found and the situation in hawaii getting worse. another fissure found on mount kilauea. as we head to break, here is today's nash fall weather forecast good tuesday morning active weather at this hour. it's going to continue during the day. thunderstorms moving through oklahoma, through the southern great lakes, even around washington, d.c. we had some thunderstorms

overnight. the big story is this afternoon. cold front will come down, it's hot. it will be humid we will spark severe weather in areas of the northeast see that orange area that's an enhanced risk of severe weather so coverage will be greater there. 47 million people total at risk. even a few tornadoes are possible if we get tornadoes it would be from this scranton area through hartford and the hudson valley of new york state. the timing on this mess, we're okay during the early morning hours. storm s popping up in central pennsylvania, they roll through 95 between 4:00 and 7:00 p.m major ladeys today. that's your business travel forecast more "worldwide exchange" when we come back

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welcome back in. stock futures gaining a bit back here we're in the middle of an eight day winning streak for the dow down 54 for the impliy eied ope still early. we wonder if that eight-day win streak will end today. mixed trade in europe. the uk up fractionally the dax is down fractionally let's check on the other morning headlines outside of the world of money and business, frances rivera has more on that. melania trump is waking up at the hospital this morning recovering at walter reed after

undergoing a kidney procedure. the first lady's office called the operation successful while the white house is calling the condition benign t marks the first time the first lady has undergone a significant procedure while in office. hawaii's volcano has grown worse. 19 fissures have opened. nearly 2,000 people have been evacuated and dozens of homes have been destroyed. the largest eruption is perhaps imminent. and unexpected drama days before the royal wedding tmz is reporting that meghan markle's father may not attend after staged paparazzi photos of him getting ready for the trip to london. he was supposed to walk his daughter down the aisle on saturday the palace saying ms. merkel and prince harry ask for respect in

this difficult situation how is that for season 15 of "the crown?" >> i'm getting the sense there's some interest around this royal wedding thing? >> maybe just a bit with the dad not coming he has not met his future son-in-law >> as if weddings are not stressful enough already thank you very much. coming up, how much did this painting sell for last night you may not believe it as we mentioned, royal wedding fever is officially trending you won't believe what kfc just did to try to cash in on all the type that frances told you about. we'll put together royal weddings and eraxt crispy after this you're a life of unpredictable symptoms. crohn's, you've tried to own us. but now it's our turn to take control with stelara® stelara® works differently for adults

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eight is great, nine would be just fine the dow trying for its longest win streak of the year trade talks front and center as a top chinese official heads to d.c. and reaction pouring in after the skourtd opupreme cour the door for legalized gambling across america full details as "worldwide exchange" rolls on ♪ >> welcome back. thank you for being with us on

cnbc happy tuesday. i'm brian sullivan let's get you up to speed on what's happening out there seattle's city council approving a new tax for the state's biggest companies, amazon and starbucks. the driver of a tesla model s that rear-ended a fire truck over the weekend in utah says her car was in autopilot mode at the time of the crash and did not stop north and south korea announcing a new round of talks on denuclearization on the korean peninsula that meeting will take place next week ahead of president trump's meeting with kim jong-un in singapore in june stock futures indicating we could not maybe make it nine in a row for the dow. it's still early coming off an eight-day win streak the longest in six months. the benchmark ten-year yield

yielding just above 3% oil may be quick lit big story we'll have much more on oil and a big day tomorrow on cnbc we wanted to know what you thought would be the best way to make money for the rest of the year the choices were the s&p 500 index fund, buying single stocks, cash or other. guess what 44% of you said single stocks, not index funds would be the best way to make money the rest of the year. joining us is steven whiting with citi private bank what do you think about that i was surprised by the answers all we get beat over the head

with is don't try to beat the market do you think there's a renewed optimism that people will try to invest and beat the market >> dispersion would tend to pick up relative to an index if it goes up 3%, 4%, 5%, rather than zooming ahead 30%. this market does lay itself better off of single stock picks. for those that succeed if you want to think about something that would succeed generally, i think there's a good chance that the growth scare around the rest of the world and the fact that trade worries focused on the u.s. and china have been priced into stocks everywhere. you probably will have a good rebound in the markets >> there seems to be a huge gap and growing gap between what the professional traders that we talked to on cnbc every day and wall street think and feel and the retail investor.

the retail investor appears much more optimistic than the growingly worried wall streeter. >> you can call it the real term long money i investve investor d to trader types. looking at market correlation, you look at put and call volumes. very few people are taking position on the market back in january, people were selling volatility when it was at a record low level, trying to earn income on something absurdly low in terms of expected volatility level. now folks have gone the other way. >> in what way >> the idea this can't work. the stokck market, if it's not rebounding fast enough, sell it.

it's taking a speculative guess on the economy we have had worried over interest rates which are legitimate worries over trade which are an overprice across world markets looking at the earnings response earnings don't matter one bit. but if you have had massive earnings beats in the first quarter, if people underestimated how profitable the u.s. could be in the first quarter -- >> isn't that normal thinking? let's say you follow a sports team, your team wins eight, nine games in a row, even as a die - hard fan you have to know they can't keep winning. they have to lose a game the patriots even. isn't it normal psychology to think maybe i should put some cash out there this is why even expecting 20% earnings gain this year, much more modest returns, low single

digits, you have had half the return of u.s. equities in non-u.s. markets the last five years. earnings and margins are low and rising outside the united states we're below 2007 levels on earnings outside the united states so the idea that every equity in the world has to response to some u.s. peak -- >> so we should own more european stocks than u.s. stocks >> you should overweight asia. do you belief that sort of china ought to be 4% of the world indices and the u.s. 52% >> steven whiting, great discussion we could talk all morning, but you know how tv works. thanks for getting up early. the u.s. ambassador to china says the two nations are very far apart on resolving their trade issues his comments come as china's

vice premiere comes to the u.s. today for trade talks. eunice yoon has more. >> reporter: expectations are high that the negotiators will try to work out preliminary deals meant to boost confidence between the two sides. as part of the deal, the u.s. would ease its restrictions on chinese telecoms company, zte which has effectively ceased operations because of a u.s. ban. in exchange china would ditch tariffs on some american agriculture products like soybeans and scale back some non-tariff barriers, like quality control inspections. some companies in recent weeks have been complaining that u.s. imports have been held up at chinese ports. everything from soy, fruit, pork, metal scrap, as well as most recently whiskey. now, the deal could encourage the chinese commerce ministry to restart its review of the acquisition by qualcomm of nxp out of the netherlands

that deal has stalled because of the chinese. i was speaking with the chair of the american chamber of commerce here who said that there are a lot of people in the u.s. business community here worried about what he described as a missed opportunity he said there's a concern that this deal, though it might be good for the companies involved, could become a distraction for some of the larger structural issues that american companies face here. he said that they want fair and reciprocal treatment they want the market access, and they're worried about the whole combination of the emphases on the trade deficit, and the upcoming trump/kim visit with president trump wanting china to be on board that could lead the trump administration to rush a deal brian? >> eunice yoon, thank you. still to come, will it be a betting boost or a bust? why some are saying the supreme court's ruling may not just be a winning hand and another big cnbc exclusive interview tomorrow

we'll go to houston and sit down with vicki hollub, it's her first tv interview as ceo ever that's tomorrow at 10:00 a.m. eastern. "worldwide exchange" will be right back

given decades of relationships with the leads, with the teams, and in nevada that we will be a significant player if not the largest player in the market.

>> that was mgm ceo jim murren on the supreme court decision yesterday that opened the door to sports betting across the country. let's talk about this with eric chemi. everybody quant can't be a winnn they >> no. there's 1$150 billion of illega gambling, that's how much is wagered. even if all that money were to come into the legal market, all of the illegal money becoming legal, but the margins, the profits these casinos make, it's only about 5%. what's 5% of 1$150 billion 7$7.5 billion that's it. 7$7.5 billion is not a huge amount of money that all of a sudden if four different sports leagues, casinos, the tax collectors, that's not a lot to go around. 90% of the money goes back to the winners. you take the over, i take the under, one of us is getting most of that money back >> i was listening to our coverage on the network

yesterday. a lot of talk about who would win, draft king, fan duel, mark cubi cuban was on if you want to look at a winner, look at booze. all constellation brands wants to do is get chemi through the door so you can bet and drink. >> that 5% margin in vegas is a small margin, but what happens you're in there, sitting in front of tv screens. >> 12 dudes all dressed slightly the same >> you spend 100 bucks on the game and 500 bucks eating and drinking there's so much more money getting you in the door. that's why it's important for these casinos to make sure they set these rules state by state to force people to bet in the casino if it's just online, on your phone betting, where is the booze in that? >> we talked to tillman, who

own s a golden nugget chain as well they want to get people in the door what he needs and they need, their challenge is to get people to say the phone is not that interesting. the casino is fun. let's go >> if you're a technology better you want to say the phone is interesting. watch from your tv at home if you're a media company you want people to sit at home and bet while watching tv. so the casinos and media partners may have different incentives >> can you see a day soon when you're on your couch, watching the football game and placing realtime bets? >> day could happen depending on which state allows it. >> gambling in almost every state now. let's get more on your trending stories, kate rogers is back with what's trending. >> this morning we have quite a few good stories a controversial painting by

amedeo modigliani has become one of the most expensive works of art to ever be sold at auction the 1917 nude study sold for 157$157.2 million last night at sotheby's, the highest price in the auction house's history. biter was the only bidder. a scary moment yesterday at istanbul an aircraft was heading towards the runway when its wing clipped the tail of a turkish airplane passengers said it sounded like a bomb went off. no one was hurt. passengers were transferred to a different plane to complete their travel. they call him the man with the golden arm an 81-year-old australian man has been giving blood every two weeks for the past 60 years. the man's blood contains a rare type of antibody and his donations have saved over 2 million people over the years.

australian laws allow donors to give blood only until their 81st birthday so this man gave for the last time this week his milestone celebrated with balloons and hugs. the royal wedding just a few days away. when kfc heard that prince harry proposed to meghan markle over a roast chicken dinner, it knew what it had to do. the restaurant chain released a promotional photo of a regal bucket in honor of the upcoming nuptials they will only be available at the kfc windsor branch in england. only 50 of them will be released >> the golden bucket, if you get the right one, will you get a tour of the chicken factory where only one kid comes out alive? >> i think i heard that plot before >> are you going to watch the royal wedding? >> no. >> why not >> why would i this is the most epic love story. she used to hold the suitcases

on "deal or no deal" and now she's marrying prince harry. >> i'm not saying it's not a good story i don't know not a big wedding watcher. >> i'll be waking up early >> i know stacey widlitz who is coming up, that's all she wants to talk about. but she will talk about retail >> did you say the bidder on that painting we bidding on himself or herself $1, deal >> i'll fill you in on the royal wedding next week. >> thank you let's find out what's coming up on "squawk box. andrew ross sorkin -- will you watch the royal wedding? >> i'm watching. first of all, i'm definitely watching meghan markle went to college with my wife >> what? hold on. breaking news. >> i will be watching very closely. >> did they know each other? >> i think they did a little bit, but not a lot i think they called her meghan markle with the sparkle because she had a bit of a sparkle

yes. i'll be watching and by the way, deal or no deal returning to cnbc this fall. there's your real tease. you know about that, right >> is that like a new version? >> a new version howie mandel, they are bringing it back. coming on cnbc in prime time >> you were at the up fronts yesterday, weren't you >> i was >> breaking two pieces of news already before the show has begun. deal or no deal and your wife went to school with meghan markle the sparkle >> here's what's coming up we have a big squawk newsmaker we have dr. scott gottlieb to talk about the drug business, where this is all headed the commissioner always has some provocative views on where we are and where we are going you've been talking about sports gambling we will be talking about sports gambling legalized sports gambling.

we'll spend a lot of time talking about the redstone soap opera that is cbs and viacom at 6:00, we'll have some breaking news. not on that deal but something else >> that's three pieces of breaking news. my mind is breaking. too much breaking news can't handle it. too early. andrew ross sorkin, breaking all kinds of news. the sparkle. thank you. coming up on "worldwide exchange," the future of sears with the company's latest move and what it might mean for the retailer and shoppers. and today's mystery chart, today's rbi. an uy glchart but is it ready to turn around? now, i take metamucil every day. it naturally traps and removes the waste that weighs me down. so i feel... lighter. try metamucil and begin to feel what lighter feels like.

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and for just $14.95 a month you get a credit, good for any audiobook. if you don't like it exchange it any time. no questions asked. you can also roll your credits to the next month if you don't use them. so take audible with you this summer... on the road... on the trail... or to the beach. start a 30-day trial and your first audiobook is free. cancel anytime, and your books are yours to keep forever. no matter where you go this summer make it better with audible. text summer4 to 500500 to start listening today. it's a big week ahead for retail walmart, nordstrom, jcpenney all reporting later this week.

stacey widlitz, a c flshgsnbc contributor joins us are you pulling the legs off sears? >> i'm plucking them off as we speak. we talked about this years ago sears which is selling off its assets and plucking off the daddy long legs, and it continues to be that way the good news for retail is when eddie lampert is done plucking off the good pieces of sears, we don't really have a continuing retail concern here. that's good for the rest of retail >> the stock spiked on that amazon tire sale story now you have this deal does it bother you that the optics are effectively that sears are selling parts of

itself to the guy who controls sears? >> yes that seems to be a bit of a conflict clearly they own 30% it seems to be a conflict when the retailer is headed not in a good direction, that the majority owner is plucking out its remaining good assets. leaving the bad assets to flounder into oblivion the optics on that are not terrific >> driving past the mall, it was raining all weekend, of course, but driving past the mall, i don't think i've ever seen it so crowded. literally you had to walk about a mile to get in any signs that traditional brick-and-mortar retail is staying around holding its own? >> absolutely. we've gone through this wave of store closings we closed more than 10,000 stores last year

probably another 10,000 to go this year. what's going to be left is certainly viable now that we're getting right-sized, i think the traffic kind of bottoms out here again, there are great retailers out there driving traffic. lululemon, tommy hilfiger who you interviewed last week. they are doing fantastic things. there's the struggling, then the survivors, and we have walmart investing in e-commerce, driving growth there so retail is definitely not dead that story is certainly played now you have to look for the survivors and the long-term winners. >> who are the long-term winners going to be? that's why we have you on. >> i would say pbh, the tommy hilfiger calvin klein owner. that has been an outstanding turnaround never seen a company turn around a brand like calvin klein so quickly. lululemon continues to win

target is doing some smart things they'll have a bit of pressure with the liquidation of the toy business they continue to do smart collaborations and even cokohl's is doing smar things shortening lead times. so the retailers that we loved to hate in the past, you can kind of look at them now and say, well, there are winners out there. let's focus on them. >> i will do something odd right now and tick off my producers. i'll do our rbi right now and have you comment on it it relates to your industry. i will read something. >> okay. roll in the royal wedding, please >> all right let's do your morning rbi. the most random but interesting thing you've heard all day we look to our charts. there's a mystery chart. this is the worst performing stock in the s&p 500 this year the reason that we're keeping stacy around is this mystery chart, the worst name, your rbi is victoria's secret

effectively. l brands, it's down 45% in the year, 10% worse than the next worst stock. she's not doing well stacey widlitz, what's wrong it's one thing when you're the worst stock, somebody has to be. when you're the worst stock at a 500 by 10%, what's wrong with victoria's secret? >> remember, lb was like the poster child for retail a few years ago, almost reaching 100 bucks, now down in the 30s what's happened is victoria's secret in the past year failed to recognize the change in how women wear lingerie. there's been a major change towards bralets, they missed that trend and now going forward you're looking at the bath and body works business where margins have peaked. so the worst may not be over as they start using promotions there to drive the business. this has gone from largely a full priced business to a

promotional business we know how those things work out in the long-term >> you can comment on everything we'll get you back on soon appreciate it. thanks for watching "wex." "squawk box" starts right now. part of you... mt your brain. with an ingredient originally found in jellyfish, prevagen is now the number one selling brain-health supplement in drug stores nationwide. prevagen. the name to remember. mr. elliot, what's your wiwifi?ssword? wifi's ordinary. basic. do i look basic? nope! which is why i have xfinity xfi. it's super fast and you can control every device in the house. [ child offscreen ] hey! let's basement. and thanks to these xfi pods, the signal reaches down here, too. so sophie, i have an xfi password, and it's "daditude".

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the u.s. ambassador to china says the two countries are very far apart on trade details straight ahead. the supreme court paving the way for states to allow sports gambling we'll tell you which states could be the first to take wagers and what it means for the economy and the sporting industry home depot expected to report in the next couple of seconds. we'll bring you results and market reaction. it's tuesday, may 15, 2018 the ides of may. "squawk box" begins right now.

♪ live from new york where business never sleeps, this is "squawk box. good morning welcome to "squawk box" here on cnbc we're live at the nasdaq market site in times square i'm andrew ross sorkin along with joe kernen. melissa lee is hanging out with us today look at u.s. equity futures this tuesday morning. dow looks like it will open down about 21 points off. nasdaq off about 6 points. s&p 500 looking to open off as well down about 3 points. we have had now eight straight days, the winning streak for the dow. yesterday started strong got weaker as the day progressed nonetheless aiming for nine days at the moment we won't get that, but we'll see if things turn around overnight in asia. let's show you what has been going on you got the nikkei and the hang seng down. hang seng down 1%. shanghai