good morning it's 11:00 a.m. on wall street it's 8:00 a.m. here at the conference ♪

♪ good thursday morning. welcome to "squawk alley." i'm carl quintanilla with julia boorstin and jon fortt here in rancho palos verdes. news that warren buffett had expressed interest in investing in the giant i talked to ceo of uber yesterday, who talked about his talks with buffett earlier in the year and even more. >> it's always possible that talks resume i think there has to be a match. we are a company that has, as you know, an enormous growth

trajectory it comes with a certain amount of risk. i don't think that we fit in with the typical warren buffett investment maybe we can be a portfolio diversification for him. you never know what happen and i would always welcome dialogue with him. >> uber's cash position is good. >> yes. >> new term loans coming online, investment from the softbank consortium you're not hungry for liquidity at this point? >> not at this moment. we're in a good position in terms of the company's profile margins continue to get better we have a very strong balance sheet and i do think that we are on track and have a reasonable buffer as well i think we're in a pretty good spot that said, we would welcome

strategic investment it's not first priority for me right now. first priority is to continue to invest in a brand and get us in a position where we can build a big business and along the way go public. >> what do the conditions need to be for an ipo to happen next year certain boxes need to be checked? >> i think the management team has to be filled out i am looking for a cfo that is a pretty important person we are in the process of rebuilding the brand and i think we're making terrific progress there. >> if market conditions continue as they are now, you would feel comfortable for '19? >> yes we're on track. >> at the conference, the balance between regulation innovation and whether

governments that lean heavily on one end give up something else in exchange. we've seen examples of this. >> yes. >> how much of that do you think governments recognize and are they, in some cases, self defeating or destructive >> there's no such thing as a free lunch i think government regulation is going to increasingly have to play a part in the technology space. >> because >> we're becoming a bigger and bigger part of people's lives, because we're becoming a part of every day life, for example, where we play in the transportation space this is fundamental to how people are going to move. elon musk wants to go underground. we're going to hopefully make overgroundwork and see which one work works. >> there's a lot to unpack here.

i wonder if you feel, guys, that transportation or autonomy specifically today is becoming the big bang to watch. >> i think we're between bangs right now. and that's been a lot of the conversation here. dara, it's interesting how quickly he has been embraced in this role and how many calls there are for diplomacy in big tech and start-up tech, airbnb, uber how are they going to be able to compromise and deal with regulation while at the same time the administration that's being very aggressive, kind of in the mode that silicon valley used to be in? there's a principle, dathere's n idea here, we're going to fight for it, no matter what the cost. in tech i think we're maybe between. >> i think in terms of autonomous vehicles, dara was adamant about the fact that it's

very important they maintain the relationship with their drivers and that driver relationship is not going away they're not going to replace their drivers with self-driving vehicles so fast and he wanted to make it clear that that kind of technology can move very slowly we are sort of in between, master that relationship with the drivers, protect their drivers. meantime they'll try to figure out the self-driving technology. although we're not there yet. >> gm news, does that suggest happening slowly when mary barra is talking about public roads at scale, not in three years, not in five years, next year. right? that's sooner than some people might have expected. >> you have to remember, when have you an accident and a tragedy like we did, people will be very careful. i think trying to reassure the tech folks that he's pushing into the future and he's going to bring us there. but also reassure consumers that he's not going to put anyone at risk and also reassure drivers that this is going to be a good company for them to work with. he's trying to reassure

everyone i think that's a reason why he has been received so well. he seems thoughtful and cautious but also enthusiastic about the technology. >> i don't envy whoever will have to ride out the risk factors for that, from self-driving cars to regulation, to travis. lot of risk factors. >> meanwhile the markets are down big news on that front morgan brennan and mike santoli are back at post nine. morning, guys. >> morning, carl the markets are definitely backing off, giving up a little less than half of yesterday's rebound. look at the s&p 500. it's not all even. obviously you see the dow down 236. the heavy industrials, the big exporters, boeings, capital exporters are really getting hit. steel stocks up a little bit, aluminum a little more mixed banks also weak.

that's not seemingly a trade issue. that seems to be this news on deutsch bank under scrutiny for the past year. jp morgan down more than 1%. a lot of things going on the market seems to be trying to separate out potential winners and losers in this whole tariff situation. >> tech is up. we get these really great headlines from our colleagues out at code on the west coast right now, in general, despite the fact we're near lows on the dow we're still on pace for our best month for stocks since january. it's worth noting it's been quite a month. >> it is also hard to separate out what month and effects we might be seeing here in the markets. also just for context, if you look at u.s. steel up a few points today, this was a stock in the mid 40s in the first rush of excitement early this year about steel tariffs where everyone thought it would be a savior here we are up but under 38. the market's reaction to every kind of tactic and maneuver in

the trade discussions maybe is diminished but obviously a net negative today. >> building toward that. we'll be watching it here as it develops carl >> carl, what's coming up on the show >> i've got a lot more with uber, of course. plus when we come back, ceo of vox, jim bankoff, will talk about media and tech and more on softbank's investment in gm cruz. we'll talk to former treasury secretary larry summers, who will way in on those new tariffs on the eu, canada and mexico. this is a story about mail and packages.

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media has been in the spotlight from facebook, netflix and youtube. just announced new partnerships with publish ers like rolling stone and pop sugar. jim bankoff is the ceo of vox media. we alwayslove checking in with him at the conference. >> thanks for coming. >> it's beautiful. safety is what legacy media companies always brag about and say digital doesn't have a solution is this it >> we think so, for sure

great new premium publishers, new york magazine, rolling stone, pop sugar, others, to a list that's impressive including quartz and many others now hitting 99% of millennials, 90% of the whole internet with premium quality video at scale, safe, viewable, performing, all that stuff is another way for marketers to go. marketers who don't want to sacrifice scale but need brand safe environments that perform. >> it seems it's all about competing with facebook and google what kind of progress have you seen or have you seen any progress in the past several months in the wake of the privacy scandal and google's brand safety issues? >> marketers are looking for another viable solution. they need scale. we've grown to be the largest independent publisher in the u.s. even that kind of scale won't be enough through leveraging our premium ad tech to these other

publishers, we can have something that's different i think we'll never have the level of data that facebook will have we're not necessarily looking to compete but are looking to complement and i think we can do that in a meaningful way. >> you did some layoffs, cuts, put out an employee memo that, for me, was a watershed moment in digital media where you talked about social, facebook in particular, not monetizing the way a lot of people hoped or expected and there's this move toward premium even more aggressively, because you're hiring at the same time. explain what it is dynamic wise that's happening how gdpr might affect that. >> there's a lot of things happening in the memo you're referring to facebook is a great platform to get attention to what we do. what it hasn't been is a programming platform

it's not like cnbc where people tune in. they're working on that. but you have to know the difference between programming or promotional platform. we're focused on making sure we produce the best possible programming. vox media does brands, vox, verge, and polygon we go deep in a lot of different big verticals and want to make sure our content is not just seen on a quick scroll but consumed and engaged. >> are you going to stop doing that they're going to keep trying. >> when i hit send on this memo and we made it public, i was concerned about what facebook people would say they said you nailed it. we want quality program and news on our platform but publishers shouldn't look at us as a

savior and we're not. partnerships we're working on with them and we'll continue to. it will be different in nature it won't just be empty views for the sake of -- i used to sit on these panels and everyone would brag i got billions of views on facebook what did it amount to? not much. >> they say they want to do more on the personal feed rather than the news so can you even rely on it as a promotional platform or is that value going away >> with billions of people around the world there will always be a critical platform. we have great relationships with them what we're not doing and have never done is become too dependent on any particular platform it's about building strong, loyal brands ultimately. we're doing that in a lot of different ways the strength we've created with our digital content has led us to produce great television shows, great podcasts. >> you have a netflix show now.

>> called "explained" with our vox brand. it's killing it. and people love it we have so much stuff hitting us every day. we don't take time to really understand what's going on. >> a big highlight of the conference here, some of the stuff that vox did speaking of which, kara was on yesterday. we asked what the theme was in her view sheechlt said tech responsibility is that, for you, the answer what's this year about >> it's interesting. you all have been here as long as i have. you see a few years ago these were all companies struggling for viability. we all woke up and said we've achieved scale and we've achieved, in some cases of these platforms, dominance and whether you're talking about regulation or humanity and tech, a big theme here as well, the company

is all -- that was a consistent theme, whether you're brian chetsky who did a great job, cheryl and mike. everyone is grappling with their responsibility to society, which is important we woke up and we're grown ups and we have responsibility. >> good stuff. we always love to have you. >> thanks for having me on the code amid fears of an all-out trade war, the trump administration is unveiling new tariffs on eu, canada and mexico eamon javers joins us from washington. >> reporter: canada, mexico and the eu wilbur ross, commerce secretary, announced the tariffs this morning. hopped on television to explain and minimized the damage that these tariffs could do to relations with important u.s. allies here is what he said just within

the past hour. >> these are blips in the radar screen i don't think they change the fundamentals of relationship everybody has spats every now and again. every family does. every country does, with others. there's nothing weird about that i think everybody will get over this in due course. >> some reaction coming in from the europeans and the mexicans here is the eu response this morning. within moments of the announcement going out saying the eu believes these unilateral u.s. tariffs are unjustified and at odds with world trade organization rules this is protectionism, pure and simple reaction from mexico, similarly, mexico will impose equivalent measures to various products in the face of u.s. protectionist measures one of the questions is whether or not we will see the president talking about this throughout

the course of the day today. he is traveling to texas today we may not get a direct statement from him for hours to come, guys back over to you. >> the plot thickens we'll be watching for that thank you, eamon javers. we'll have more on new tariffs former u.s. treasury secretary larry summers is with us wl igk alley"ilbe rht back don't go away. om the market when it might be time to buy or sell? with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today. approaching medicare eligibility? you may think you can put off checking out your

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welcome back to "squawk alley. rick santelli with the santelli exchange rick, good morning. >> good morning. thank you, morgan. i would like to welcome my guest, bill isaac. thanks for joining me this morning, bill. >> thanks, rick. it's always good to be with you. >> wearing your former hat, it seems as though the fed is changing the rules with regard to dodd/frank. four regulators, the office that

controls the currency and the fdic after the fdic announced last week record bank products q1, $68 billion. is this something we need to see? why is it being done now do you agree or disagree with easing back these rules, bill? >> i think dodd/frank really overdid things in some ways. and i think the regulators were overly reaching. i don't agree with everything they might do. for example, they eased big bank capital standards a couple of weeks ago or three weeks i was concerned about that governors brainard of the fed and chairman grunberg of the fdic did not follow seat

they descented against that. s i don't think there's a big movement in hand to change all these regulations or wipe them out. i think they're trying to make them easier to apply and oversee and for the banks to continue to do their business effectively. so, that's what this is about. >> so you agree with the notion that it's not about undermining the intent and spirit of the original legislation that seemed to fit your comments >> i agree with that i think paul volker agrees with that he's not troubled by what they're doing. i know paul well he was chairman of the fed when i was chairman of the fdic we continue to talk. and i believe he thought what they did to the volker rule made it almost impossible for banks to understand it and comply with it and even the regulators couldn't figure out how to deal

with it. so this is a much-needed simplification of the rules. >> we're just about out of time. real quick answer to the following, a lot of dismay regarding this administration trying to tackle the issues of fair trade i know markets are important and we need to be cognizant of investors but sometimes there's bigger fish to fry do you agree or disagree >> i agree with you, rick. what we're doing with trade with respect to various countries, it's a very, very complicated chess game and you need a stick and you need an olive branch. >> we're out of time i'm glad you weighed in on trade. it will be a big topic today thank you for joining us carl quintanilla, back to you in nice, sunny california. >> thank you very much, rick

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good morning, everyone i'm sue herera here is your cnbc news update at this hour, president trump

escalating a feud with abc in the wake of the "roseanne" cancellation tweeting this morning, quote, iger, where is my call of apology? you and abc have offended millions of people and they demand a response, end quote the president says he will give a full pardon to dinesh d'souza who pled guilty to finance fraud, who says he was treated very unfairly by our government. he was sentenced in 2015 to five years probation. sears says it will close an additional 72 stores as sales continue to plunge last time they saw an increase in sales was the third quarter of 2011. and some new data in from the blue cross/blue shield insurance company shows cases of melanoma have increased 7% over the past four years. indoor tanning beds, that's the main culprit people who first used the

tanning bed before the age of 35 increased their risk by 75%. something to think about back down to "squawk alley." mike i'll send it back down to you. >> pretty stark numbers there. thanks very much, sue herera. >> morning, seema. negative month of may for most european markets, dragged down by this ongoing political uncertainty. london ftse bucking a trend. but today's declines coming after the trump administration announced it will impose tariffs on steel and aluminum imports from mexico, canada. you saw strong comments, calling the move unacceptable, adding that the block will announce counter balancing measures in the coming hours meantime an update on european politics, which, of course, has been the center of action. media reports out of spain say that the bask nationalist party

will vote against prime minister keep a close eye on spain. meantime italy, its president is giving the populous five-star parties more time to form a coalition government and avoid that fresh election italian ten-year yield continues to dip lower. we finish on deutsche bank that stock down sharply. wall street journal reporting that the u.s. federal reserve has designated the bank's american business to be in troubled condition, downgrade being issued today stock down 7%. >> thank you, seema. as we've been talking about all morning, the trump administration hitting canada, mexico and the eu with new steel and aluminum tariffs that threat of a trade war taking center stage here at code

>> we already have a little bit of a preview when trump was on the campaign trail he talked about being unpredictable. we're seeing this on again, off again unpredictability a week ago they came out after the summit meeting to say that the trade war is on hold but now there's tariffs on $15 billion goods. i think we are -- in a way, we kind of predicted unpredictability there's always going to be volatility we're focused on the long term. >> with us, aventure partner and capital managing partner great to have both of you here hans, how does this unpredictability that joe tsai talked about effects investors

trying to do business in china or compete with chinese start-ups? >> if you look at the landscape, apple, starbucks, gm have done very well in china more of a localization approach. look at companies such as alibaba, they're trying to expand to come to the u.s. and elsewhere as well. chinese company realize that it's more unpredictable and therefore more likely to expand to other emerging markets in india, middle east and eastern europe we actively invest in both geographies. as early investor in alibaba, we agree we should help more. >> tsai talked about how they're open for business and want to partner with american companies who want to reach the chinese market how do you think about that when you're looking at portfolio companies and their opportunity to move into china

>> it's a ridiculously awesome market we probably think about investing in china i'm envious of the alibaba position incredibly accelerated place, you can see them go to places relatively wise. but we are also looking at how can we help our companies do business in china? carmen chang, first female general partner in 40 years. very well networked there, spends a lot of time on the ground look at joint ventures and partnerships as a way to help. when you can do that with the best american companies you can create great outcomes for everybody. >> there was a great moment where tsai basically says we're spoiled in china because we have automatic scale and even pilot programs will automatically get tens of millions of users. >> that wasn't the case years ago. >> right. >> but he said we saw the trade

volatility coming. we saw the anti-trust stance coming how do you think their attitude changes now that it's actually here >> you do what makes sense for your company, do the right thing. ethical, moral leader of your business and focus on growing as fast as you can without being dangerous to yourself. >> when they were talking about health insurance reform. and you have to run your business as best you can. >> randall stevenson, we heard it with facebook, rupert murdoch talking about their deal do you feel like regulatory risk is a bigger concern for the companies that you're working with and is a barrier to deciding to invest in different industries >> absolutely not.

i think with regulation, their impact on real world economy gets larger as well. there has to be some kind of compromise what's lost in all this discussion is the world has gone from 2 billion internet users to 3 billion to higher. both u.s. companies and chinese companies have plenty of insights, innovations that have to be exported that's what's missing in the u.s. versus china. >> this one could be for either one of you is there some kind of a tpp effect to the trump administration's approach here they're saying this is about fair trade china needs to open up but we see some chinese companies, including didi, forming these coalitions that stretch outside of china across south asia, southeast asia and then we see companies like uber reacting to that are chinese companies going to be in more of a partner in global alliance position and do u.s. companies and start-ups

risk getting isolated? >> i think uber, obviously, is investor as well. >> they are now. >> put 2 billion to china and dd is now worth 10 billion. profitability to get to a clear path ipo, they will be trading in markets they don't want to be so there will be some markets that will be give and take that lets the chinese company expand and some markets that the u.s. company will take a stock hold in and that's totally fine. >> ipos and the slowdown of private silicon valley companies going public, both uber ceo and brian chetsky talked about that. take a listen. >> we are in a good position in terms of the company's profile in terms of profitability. margins continue to get better we have a very strong balance sheet and i do think that we are

on track lots of things can happen but we have a reasonable buffer as well i think we're in a pretty good spot that said we would welcome strategic investment it's just not first priority for me right now. >> we'll be ready to ipo next year but i don't know if we wil will. >> i want to make sure it's a major benefit to the company when we do it. >> patients can be painful, ben. the equivalent of a second mortgage, trying to do a secondary and cash out what's the situation here with investors who are perhaps trying to be patient but really want these companies to go public what's happening >> a lot of different things are happening. that's been reported but we've not commented on it, by the way. there's a lot more sources of capital that are robust. sovereign nations putting capital and all kinds of

oversized corporate entities companies that are really exceptional are being provided and this can be tempting personally i took a company public when i was young. i believe there's a lot of rigor that requires. you're put in a public spotlight that can be very healthy, create a currency you can use my personal view is that it's always a positive when the company is ready the challenge is, is it ready? one thing that's changed over the last, call it, decade to 15 years is a lot of first-time founders coming out, learning lessons along the way but growing at incredibly accelerated paces. from zero to tens of billions of revenue in six years, there's a lot of learnings there you want to learn those things in a careful way. >> we heard from spotif i's daniel ek. even brian chetsky said they're not necessarily going to go

public even if they're ready how much of a problem is it in terms of the pressure you're getting? >> i think along the way different kinds of capital will come in. you have softbank raising $10 billion fund all that makes it easier for early investor to cash n at the same time, later investors come in that could be with the company three to five years. i think that's the new normal we're dealing with today even facebook the first year or two was rocky as a trading company. all the ceos talk to each other and realize that you have companies that started in 2008, 2009, 2010, so the next two years, '19 and '20, will be very interesting. >> this has been happening for years and years and years. bigger, higher quality companies getting public this is not prior

era where some velocity and no path to profitability will get you there. you're just seeing companies so much more substance and those early times can be -- no ceo i've ever met has enjoyed -- they love the spotlight of going on the floor and then it just gets miserable for a while. >> good spot no more yos. remember that start-up thank you for joining us. >> thank you, guy. >> great having you. former u.s. treasury secretary larry summers will join us, weigh in on the white house's new tariffs when "squawk alley" comes back.

i'm scott wapner top of the hour on "the half time report," trade war and takedown of stocks what it all means for your money. plus the analyst call that jim cramer said was heresy is it time to get out of micron? athena health, revelations of domestic violence and what the company should do about it, if anything. we'll discuss with leadership expert suzy welch all at noon on "the half time report. we'll see you in 15. >> thank you looking forward to it. steel and aluminum import tariffs begins at midnight

tonight against eu, canada and mexico jean-claude juncker, calling it protectionism, pure and simple, adding that the eu will not negotiate under threat we will defend the union's interests. something that wilbur ross downplayed with us last hour take a listen. >> these are blips in the radar screen i don't think they change the fundamentals of relationship everybody has spats every now and again. every family does, every country does with others there's nothing weird about that i think everybody will get over this in due course. >> joining us now for reaction, former u.s. treasury secretary larry summers. mr. secretary, thank you for joining us today. >> good to be with you. >> so, given the comments from commerce secretary ross that everybody will get over this in due course, do you agree

>> i think the policy is ludicrous. 50 years from now, people will not remember this episode. but the truth is, we shot the economy in our foot today by raising the price of key input for industries that employ 6 million people in order to protect industries that employ less than 100,000 people we damage relations with our closest allyies we undermine the system that allows our labor force to prosper and threaten our national security by driving a wedge between our allies at a moment when we've got real challenges with respect to china to face. so, yes, all mistakes are corrected in the fullness of time but to defend a wanton act of

economic aggression that hurts our economy by saying that all things work out in time is absurd i'm appalled by the action today. >> commerce secretary ross said when it comes to additional input costs be it soup, beer or soda cans that you're talking about fractions of pennies on the dollar in terms of additional costs he also said when you're talking about the impact to tariffs and even retaliatory tariffs that it's still less than 1% of gdp when he uses terms like shoot ourselves in the foot, do you disagree >> first of all, 1% of gdp is $160 billion where i come from, that's a huge amount of money. so yes, compares things to the

whole economy. but $160 billion is a lot of money. i assure you that raising the price of steel by 25% adds a lot more than fractions of a penny to the price of domestically produced automobiles yes, it may not add that much to the price of a soda can. why is that the question we're asking shouldn't we be asking about the major manufactured goods on which our future prosperity may importantly depend of course, his calculation takes no account of the impact of the retaliation that will operate to limit our exports. his calculation takes no account of the uncertainty that will deter investor for anyone who is using inputs his announcement takes no impact of the reduced efficacy we'll have in opening the chinese market when we're squabbling with our traditional allies like

europe and canada. his calculation takes no account of the damage we've done to nafta by, in the midst of a negotiation, where we're trying to renew and repair it suddenly imposing what areit, suddenl imposing what are probably wto illegal tariffs on our closest north american neighbors so, i actually think it's affront to common sense. >> i want to dig into this idea of calculations some more. i assume you did some of your own calculations looking at the latest reading of consumer spending has jumped manufacturing has been robust. got that new reading on first quarter gdp, down 2.2% how do you see this playing out, at what point, whether it's this or tit for tat tariffs going back and forth to china, at what point does this actually seem to affect that economic growth

because it seems pretty strong right now. >> economic growth is pretty strong that's the legacy of many years of low-interest rates. it's the legacy of sugar high, from unsustainable tax cuts that have been put in place but, yes, the growth, the legacy of unsustainable increases in asset prices and extensions of credit no question. that economic growth, right now, is strong. but that doesn't justify taking policy actions that damage our alliances that push up inflagtin by imposing tariffs on imported goods. the argument here is that we're taking an action, making us poorer, and is doing real damage to the global economic system. and is weakening us vis-a-vis

china. and more the broad forces that drive the business cycle are running well, or running poorly, really got nothing to do with whether this was a prudent action, that was taken today there are people who are on my side of the argument who like to be hysterical and who say this will drive us into recession i wouldn't make that claim i'd settle for the claims that i've made about how damaging the action is. >> well, secretary summers, we're going to leave it there. we appreciate you coming on and giving us your reaction, larry summers, the former treasury secretary. thank you. >> thank you we have much more ahead. take a look at the major averages at this hour. stocks are up pretty significantly after the lows you see the nasdaq and positive territories. some reports that italy has made some steps to forming a

coalition government and that perhaps is what put a bid into this market. the banks bouncing back hard "squawk alley" will be back. don't go away. here. we perform over 50,000 operations a year in places like this. for the past 15 years, chubb has identified ways that we can strengthen our safety measures. and today, our hospitals have some of the best patient safety records in the country. now, we're constructing new buildings that will define the future of piedmont and chubb is here, insuring our expansion.

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stocks off the lows in the morning. when we come back a lot more ahead on what's moving the markets street plus, it is not the trump/kim meeting were you expecting. we'll tell you who the president met with, when "squawk" hour is back in two.

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it's been a great couple of days here at the code conference here at rancho palos verdes. my thanks, if the theme was about tech taking responsibility, we talked about antitrust structure.

regulatory structure there was a whole panel on women in technology in d.c would you guys agree with that >> yeah, we heard a lot about how tech is growing up and i think these are the themes we're going to be talking about over the past year. a lot of big surprises as you look at what happened with facebook but these are the themes we're talking about in the foreseeable future >> i don't know if i'd go as far as to say tech is taking responsibility it's a woodshed year like big tech, yeah, we're not a monopoly, we're sorry, we're sorry, by the way, did we mention we're sorry? by the way, there's tons of competition and we're very sorry. >> as we got a look at self-driving cars. tesla had models out we did get drone video >> it was a cool show last night with the drone show. flying out of the sky. all of a sudden, they started doing this amazing dance similar to what we saw at the olympics,

and it was pretty spectacular. >> they did different takes on the code, and recode that's intel doing good things >> we'll see how that disrupts the fireworks. >> more disruption in the fireworks industry let's get to the judge and the "half. and welcome to "the halftime report." i'm scott wapner our top trade this hour, the trade war and your money stocks selling off today as the trump administration slaps tariffs on canada, mexico and europe what all of it means to the markets on this, the final trading day of hour. with us for the hour, joe terranova, pete and jon, and we'll begin with the markets stocks are lower on the news of the new tariff