>> live from new york where business never sleeps, this is "squawk box." good morning welcome back to "squawk box" on cnbc hope you had a happy 4th i feel like there will be some hangovers this morning for people watching. i'm andrew ross sorkin along with joe kernen. melissa lee is with us becky quick is off today look at u.s. equity futures this hour the dow look like it will open up about 140 points higher the nasdaq opening up about 32 points higher. the s&p opening up about 14 points higher.asury yields at this hour the ten-year note, 2.862

the imf is cutting its forecast for german gdp growth to 2.2%. it argues rising protectionism and the threat of a hard brexit has exposed the economy to short-term risks markets in europe are a bit higher the dax is up by 1.25% the cac is up by a percent green arrows in italy, spain and the rest of europe checking the markets in asia it's been a tumultuous week for asia overall we are continuing to see red over there as the yuan tests 11-month lows. pobc coming out saying it will -- its pledge to stabilize the yuan, but still the shanghai composite down by almost a percent. president trump is calling on opec to reduce pricing now. this was from a tweet yesterday. the president said the opec monopoly must remember that gas prices are up. they're doing little to help if

anything they're driving prices higher as the united states defends many members for very little money. this must ab two-way street. reduce pricing now nice he didn't say nice this comes days after the u.s. and saudi arabia discussed the possibility of the kingdom releasing more crude to dampen rising prices. just now iran's opec boss says trump's tweets added $10 to oil prices tomorrow is another jobs friday. >> it happens, once a month. >> i know. but months feel like weeks, years feel like months days feel like weeks it feels like i have breakfast every hour my breakfast now is grapefruit and crappy toast >> my apologies. >> seems like ages when you lost

it on that last tweet on the jobs friday. >> right right. what if tomorrow he goes, really dreading this jobs report. wow, what happened you are expecting anything tomorrow >> i would think that's a problem, too >> you will stick to your guns that lasted -- >> that lasted >> austan goolsbee said they were headed to hsing-hsing because of that. going to jail because of that tweet. >> in a normal world, by the way. >> in the world of the left? did you see we got the lowest level ever of people proud to be meshes 96% -- >> what does that say? >> 96% of republicans were

extremely proud. who skewed it down to 47%? what does that say >> that democrats skewed it down to 47% the democrats are unhinged >> it's not about being unhinged >> how can you have such a high number of republicans extremely proud and it lowers the average to below 50% >> it would be like negative >> you can look at me all day long >> i withdraw the comment. >> thank you thank you. >> overwhelmed no, sustained. sustained. >> we do have other news to bring you. congressman steny hoyer, a long-time guest on this program has been hospitalized for pneumonia. he's being tweeted wi treated wh antibiotics and is resting he is 79 years old he is the second ranked democrat in the house behind nancy pelosi. the chairman of hna group

has died during a business trip in france. police say that he was posing for a photograph and fell about 50 feet from the wall. he was the architect of a $50 billion acquisition spree that saw hna buy stakes in deutsche bank, hilton under pressure from beijing, hna sold off many of those assets to slash debt this is one of those situations, i don't know if you read the details, he literally wanted to get this picture he's climbing closer and closer to the edge. >> he gets up on a wall, which is meant to keep tourists safe he gets up on the wall to get that picture and falls off >> i have learned, just from twitter, a week doesn't go by where someone doesn't die trying to get a selfie shot in a waterfall a few weeks ago selfies are -- it's not worth it

for the picture to get the shot, is it? >> no. no >> clearly not stay off your instagram account. in this case, i don't even think it was a selfie. >> you know what i mean. >> everybody wants the picture hasn't happened unless the picture exists >> "wall street journal" reports that zte has named a new ceo to comply with that deal that the u.s. struck. in april zte was forced to halt most operations after the u.s. banned the smartphonemaker with that ban saying it failed to disciplin executives who conspired to evade sanctions on iran and north korea. praxair agreed to sell the majority of its european gas business for $6 billion that deal will help praxair and

germany's linde move closer to completing their $83 billion merger creating a global leader in the distribution of the industrial gases. barnes and noble fired its ceo for violating some kind of company policies the decision was not tied to any potential fraud. the cfo and other executives will share the ceo duties until a replacement is found what was the first story i was doing? the zte story? >> that was it, but something else i was thinking about. >> praxair barnes & noble all right. let's look ahead to tomorrow's jobs report joining us for that is the founder and president of hayder capital management and edward

stringham, president of american institute for economic research. good to have you both here let's start with you, edward in terms of the jobs report, we have the jobs report but also the tariffs on $34 billion of goods. how do you sort of parse that out tomorrow >> i think the government can't get out of the way of the economy. so on the one hand we got a lot of deregulation, that's really fueling markets in a good way. at the same time these tariffs are hitting american corporations, half of the big dow jones companies sell more than half of their products abroad that's going to hammer these companies if you're saying, look, you have to face the prospect of trade barriers, of tariffs. that will hurt all of the large american corporations. >> you started off saying that you can't syink the economy, so you think economic growth will prevail still? >> yes it's like the corporations are going, running, running, then

the regulators, the tariffs, it's like wait, wait, we're dragging us down i don't think it's terrible, but it's not as good as it could be. this is one area that economists tend to all agree on don't drag these american corporations down. >> sayeed, what are you expecting in terms of markets and market volatility in the coming weeks we are going to fire the first salvo supposedly on friday with the tariffs. china has said already they don't want to be the first one out with this trade war, but they will retaliate. >> the tariff situation looks like it's getting worse. the fed today is going to come out with minutes at 2:00 i think they'll show no real concern yet about tariffs. we're likely to get good jobs

tomorrow i don't think -- you'll see bond markets rally a lot on this tariff stuff, but you may see a rally in the long end of the curve. the liquidity globally has been declining because of the fed draining the balance sheet the u.s. issuing a lot of t bills, tax repatriation, ecb ending its qe purchases. all these things happening over the summer period of low liquidity. i think we'll see that the tariff situation will be getting considerably worse >> does that mean the stock market gets worse? >> what's clear is so far the pressure has been on asian markets. both currencyies there. that will continue in the past, in 2015 when there was a sharp devaluation of the

renminbi, eventually u.s. markets suddenly started to underperform asian markets and catch up in 2015 we had a policy response the fed stopped raising -- there was a rate hike and the market rebounded and stuff like that. but this time around i don't think the fed is in position to delay rate hikes i don't know where the put will come from. i think the put has to come from china. you have to have a major stimulus program or something coming out of china eventually to turn this around. >> you're saying the put in the u.s. stock market right now won't come from the trump administration, it won't come from the federal reserve, you look to china in terms of -- in terms of stabilizing the yuan and stableizing the dolla idstae

rate >> the question is who will ease the fed is not going to stop raising rates right now. i don't think they can because they have inflation which is gradually ticking up unemployment rates are dropping. they have to continue on with rate hikes so who is left among the central banks? i think it's largely -- and the boj is out of bullets. it's the chinese what can they do they tried to eedz the othase ta with an rr cut, look at what happened to renminbi it sold off. it sold off really fast. they could have massive capital outflows out of their country. they will ease a bit on monetary policy they'll probably have to turn on infrastructure spending and stuff like that.

>> did you found the american institute of -- >> founded 85 years ago. >> you guys don't manage money, do you >> no, we are a not for profit research economic institute. >> is anyone any good at forecasting stuff? >> i can predict the future. >> i know it's dismal. it's tough to do what's your gdp forecast for next year? >> we would say you can't predict the future but we can look at policy >> how is it looking for gdp better or not? i would disagree with my friend over here -- >> are you guys friends? >> we are now. these tariff things, it will hammer, hammer, hammer >> how much does it cut off of gdp? >> it can go as big as possible. we know about the great depression, the tariff act

>> so you're taking it to a terminal point that most people don't think it will get to >> at the margin, at the smaller steps it will be a drag. we can look at harley. i feel bad for these motorcycle drivers. they can't buy their harleys anymore. they have to start producing them in thailand this is something that will affect will it half gdp tomorrow? no, but in today's world it will have an effect >> all right so you are non-profit, but you provide research thank you. >> thank you tomorrow the u.s. will impose those aforementioned tariffs, about $34 billion wort on chinese imports china expected to strike back. seema mody has a look at where these things stand give us more color on this >> yeah. it's important to know that it all started back in march when

the u.s. administration unveiled it's steel and aluminum tariffs on imports from key trade partners that invited a strong response from mexico, the european union, canada and china let's break it down. let's look at the numbers. starting with china. it has already unveiled $3 billion worth of tariffs on u.s. goods like aluminum, steel, fruit and pork hundreds of individual u.s. products will be subject to these tariffs. these are some of the major targets. mexico responding with $3 billion in har rif tariffs on p, steel. and the eu slapping tariffs on bourbon, motor bikes this resulted in harley davidson announcing its moving some production to europe and canada responding with $12 billion worth of tariffs against

the u.s. went into effect last sunday on steel, whiskey, and other things the next round of tariffs could spark a larger international response the trump administration will start imposing 25% duties on 818 items of chinese imports worth $34 billion. china warned it will strike back targeting a number of agricultural goods from politically important states, the other big tariff battle, the potential u.s./eu auto tariffs president trump threatened to impose a 20% tariff on all car imports from europe. we'll have to wait and see how it shakes out. >> it's july, but you're so busy on this beat we'll need you for -- there's a lot of other beats coming. >> perhaps cryptocurrencies? >> no the jobs report tomorrow pompeo is headed to north korea.

then this putin thing is coming back out >> july 16th. >> which putin thing >> i will tell you that's what i wanted to ask. the news cycle, it's getting shorter. it's july. >> it keeps the summer interesting. >> so be ready for the calls in the middle of the night. my question to you, sorkin, about the putin thing. >> i say which putin thing >> i will elude to that. >> there's more than one >> i know that >> he goes to meet putin do the democrats -- >> yes the democrats, like those. >> you people. >> how do you see it do you see it like he's got to meet with his puppet master because he agreed to do this before the election to win the presidency, or it's such a witch hunt that he doesn't care what

you think, he's just going to meet putin because it's good for the country to try to improve relations. which do democrats think they think he has got do it because he's in the pocket >> i understand the question depends on who you're talking to >> like whetheryou're proud of america or not same group of people there's a group of people who think he will meet with the puppet master, and others think he is doing this for the right reasons. >> i believe the u.s. should meet with russia >> so he do i at the beginning of the obama term, he was reaching out, doing all this now it's like, i don't know. the world is topsy-turvy >> you remember when he would criticize the previous president about who he was going to meet with >> yeah. >> or what they would do >> nobody is really set in

concrete on their positions, are they >> i like to think i'm set straight right down the middle >> yeah. yeah politics is a dirty business it's difficult i could never do it. could you? >> i think you could do it >> because i'm a sociopath let's get out of here. >> coming up, how many hot dogs can you eat in ten minutes we tried the doughnut thing on the show, but not as many as competitive eater joey chestnut. we'll tell you how many he ate next alerts -- wouldn't you like one from the market

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eating contest on coney island he ate a record 74 hot dogs in ten minutes breaking his record of 72 set last year. it was his 11th win. >> so gross. >> we play it straight every year and do this i immediately can't help but think of the repercussions i can't help it. >> i can't watch it. >> the fact you have to have a technique to down that many. >> you have to put the water mixed with the bread >> disgusting. but you don't -- you digest it, right? you are not allowed to -- >> you get disqualified. you have to keep it down >> but for how long? >> i don't think they follow them around after. >> what happens? what happens >> terrible things >> like a colonoscopy thing. >> this guy trains for it. he goes around eating lots of other things his stomach is used to it. >> is it okay? does his stomach go back to --

>> i don't know. i don't know >> is it a -- >> he does this every year >> you say golf is not a sport, right? is this a sport? >> yes >> it is a sport >> i don't know. it hurts to watch it >> it does >> i like hot dogs but not like that. >> i had a good hot dog yesterday. very -- i like them almost blackened. >> are you a yellow mustard or brown? >> actually, no mustard. >> what do you have on it? >> no condiment. >> just plain with the bun >> love it plain >> a little crispy >> really crispy >> you have to have the casing on the hot dog >> i like that but i like mustard ifshl >> i would do mustard if i can't get it crispy. >> onions? >> no. >> coleslaw? >> coleslaw on the side. >> all right got that out of the way.

travis air force base in california had a nontraditional intense day air show yesterday the fireworks were out of the question due to a wildfire lots of danger in the area so they got creative partnering with intel the base used drones to put on a light show in the sky. the technology was previously used at the olympics and super bowl it looks like its own fireworks show very, very impressive. all those drones, can you believe that >> wow that is kind of cool >> very cool >> they can do all sorts of designs. >> can you hear them >> you can't >> you can't hear the collective buzz >> nope. they're pretty high. >> yeah. it looks like amazon is taking a page out of toys "r" us's book. they are planning to mail a holiday toy catalog to millions

of homes they have produced a digital toy catalog for years, but now may be embarking on a mailer >> you don't want to figure out what your kids want. >> this will encourage more sales. >> more velocity in the economy, economy does better, toymakers do better. all good >> all good. >> extremely proud of all this coming up, a new round of tariffs set to take effect tomorrow on china. a live report from washington. axios executive editor mike allen will join us

he called it squawk square first. before we go to break, here's tuesday's s&p 500 winners and losers

welcome back you're watching "squawk box" live from the nasdaq market site in times square.

good morning we are up 133 on the dow the s&p indicated up by 13 the nasdaq indicated up 32 and change and i'm not convinced that this is the fourth straight down week in the dow it's too early to tell we only had two days we have two days to see if it's going to be the fourth straight down week. >> we have two straight full trading days you never know >> you don't >> president trump set to attend a rally today in great falls, montana. trade continuing to take center stage in washington. joining us is axios' mike allen. good morning, mike >> good morning. >> happy july 4th. nice to see you.

going through axios a.m. this morning. you have mueller at the top. i was surprised by that. you see something happening, advancing here >> mueller is getting new resources. using more justice department lawyers, more fbi agents, more u.s. attorneys offices so he's not adding to his staff of 17 prosecutors, no political appetite for that. the fact he's expanding shows he knows there's more fights to come and this report shows there is an indication he may be handing off to other jurisdictions. that fascinating "new york times" op-ed today says that by going after the trump foundation, that state or local prosecutors could very well wind

up putting the trump tax returns in the public domain >> don't know if you got to see the top of the show. joe was giving me a hard time about how -- >> shocked by that >> about how the public might think about this potential meeting between the president and putin. how is washington thinking about that >> well, i can tell you that people here know that allies are appalled by the idea just that it's taking place. let let alone the content of it. we know they're concerned about the fact that based on these letters that the president sent to allies at the time, that this may be a tense nato summit meeting in brussels. after that he goes to russia where he was supposed to raise with putin the meddling in u.s. elections. supposed to say that the u.s. cannot have a normal

noncombative relationship with russia until they stop interfering in our elections on the scale that they are. interfering beyond what china does, beyond what we do. now there's going to be pressure for him to bring up this nerve agent from britain, this second case of it so people in washington know that this is playing badly around the world and there's not a lot of confidence that the president will change that with the content ofa summit will he really go in there and take it to putin i can tell you even his aids are skeptical. >> i saw the second nerve agent. i immediately wanted to know who these people were. do they have connections to russia or is it lying around somewhere in the uk? is there a reason to think that they're enemies of putin or something? what's going on with this one, mike >> no connection has surfaced in

the reporting out of england what it may well be is a residual from before but this could show sloppiness by the russian agents who did it before, and so there's no reason to just dismiss this and say this was oh, it's just leftovers. this could inflame the relationship between uk and russia >> do we think there will be a round two on the president meeting with kim jong-un in new york now >> this shows the optimism of people in the administration there's plenty of evidence that north korea is back sliding, hiding or otherwise not exactly denuclearizing but there is hope that if north korea makes progress, that

perhaps when the u.n. general assembly comes to new york in september, that there could be that round two this would be amazing. the president meeting kim jong-un on his home turf and just having kim jong-un in new york would be astonishing. people in the administration say that they definitely would have to show progress to do that. but what you can see the president doing is holding this out as a carrot saying if you move we'll have this meeting then he could still pull it back with pomompeo, the second stairf state heading there the administration is giving him the benefit of the doubt even though reporting by nbc and others questions whether they are worthy of it >> mike, always good to see you. what did you do july 4th >> so axios hq is on the 13th floor of a cool building in arlington with a picture window view of the mall so we had our colleagues, their

kids watching fireworks with restrooms, with air conditioning, with snacks and with booze i know joe will be offended by that >> how many hot dogs did you eat? >> so hot dog is the most patriotic food among republicans. democrats in an axios survey, their favorite food was hamburgers not a lot we can agree on. >> meat from global warming? did you see the most patriotic state? you were in it virginia >> the most patriotic state is the commonwealth of virginia >> while we're talking about being a patriot what does mike think of the other survey we were talking about earlier, about people feeling proud to be an american? or not >> it's just weird that it was so right down party lines. it's what we know the world is like now

>> proud to be american is different from party lines i wrote about this yesterday >> if you conflate america with a particular party leader, they have won like a smart distinction that was made, there was a "usa today" poll that said are you proud to be american are you proud of america right now? those are two different questions. that impacted in a smarter way but if you look at america, our prosperity, if you look at our military, if you look at our volunteer service -- >> i didn't need qualifications to be extremely proud. never a better time to be alive. >> where else do you want to live where do you want your kids to grow up? >> i love visiting italy, but i don't want to live in rome i don't. >> come to virginia.

all right. maybe i'll come down virginia has some potential, but they have not shown it recently. thanks >> have a good one-day week. >> thank you >> good to see you coming up what is working in retail we'll talk about the shopping trends that could make you money in the second half of the year. and an early read on jobs friday we'll bring you the adp private payroll report at 8:15 a.m. eastern time stay tuned, you're watching "squawk box" on cnbc it brings your business up to speed, doing more with systems you have in place. it can bring all your apps to life and run them within your data center. it is... the ibm cloud private. the cloud that's built for all your apps. ai ready. secure to the core. the ibm cloud is the cloud for smarter business.

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welcome back to "squawk box. the dow looking to be higher by 139 points s&p looking to add about 13 1/2. we have the jobs report on friday as well as tariffs on chinese goods with a promised chinese retaliation on friday as well this will be a big week of trade here time for the executive edge. uber has restarted its ride

hailing business in finland after a one-year pause that country's transportation law came into effect july 1th. it removed a cap on the number of taxi licenses a local uber executive had said that more than 250,000 people in helsinki opened the uber app since august, even though the company had not been operating there at the time a couple other countries that ultimately should come online in the next couple of years that had similar issues. >> and some good news at the box office with the universal studio s. hollywood closing out a record quarter. more than 6 billion in ticket sales putting it on pace for the best summer since 2013 led by "jury rassic world.

the film's global take is expected to top $1 billion they should hit it by the end of this week. where were we? >> on which? >> nothing i'll come up with it >> where were we in our conversation >> no. i know where i was >> you were talking about uber so i immediately -- i think uber, i think tesla in respect >> you think uber and tesla? >> uber and tesla, the two hot-button issues. >> yes >> what does it mean, he didn't want to do the brake testing and what does it mean that engineer left at the same time they hit the number? >> the engineer guy left because he was on a leave of absence since may. net-net is it positive or negative news for tesla? >> completely neutral news the engineer, he leaves in may, originally the idea was that -- >> may, okay >> that elon would take over more of the day-to-day activity,

and he would take over this other piece of it. that clearly wasn't working out. then they were going to put him on a break he was going to spend time with family, now he's out there's that that's a negotiate sieve overall. >> it's not the first. >> the brake thing, i spent a lot of time on the braking thing. >> i thought everybody goes through those tests. >> here's the issue. the issue is that there's a brake test that they do on the line okay >> yeah. >> most car companies do the brake test on the line which they don't do, which test la do -- tesla does do, they take the car out and drive it around the track. when you drive it around the track, you are also doing the same test that you do on the line they were saying, look, doing the test on the line is completely redundant since we're already taking it out basically to actually drive the thing to figure out whether the brakes work there will become a time when their production is hopefully

good enough that they don't want to even take the cars around a track. >> it would be so time consuming. >> in which case they would go back to doing the test on the line the idea that they're not doing the test on the line, clearly that sent the stock down it's not clear to me that was the accurate take at that moment not a bad story to put out there. but the context around it when it first came out really sort of created a misunderstanding >> do you see how i set things up, i tee things up for you in. >> i do. >> you have ever done that for me, other than cutting me off and not getting me to say things this is a generosity anchor. >> generosity. >> i think about things you like to opine on. >> there's a couple things from the caller and drudge that i will tee up on >> thanks. >> in just a moment. breitbart. let me see what they have this

morning. >> you need the break to do that >> i found all these things in daily beast and mother jones coming up, how to profit from consumer spending trends a closer look at the retail stocks that are working now. here's a quick check of what's happening in european markets. they're green. they love independence day that we have over here. finally getting over it. >> good story here about how melania is showing off her patriotism at&t provides edge-to-edge intelligence, covering virtually every part of your manufacturing business. & so this won't happen. because you've made sure this sensor and this machine are integrated. & she can talk to him, & yes... atta, boy. some people assign genders to machines. and you can be sure you won't have any problems. except for the daily theft of your danish. not cool! at&t provides edge to edge intelligence. it can do so much for your business,

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♪ i will buy you a garden where your flowers can bloom ♪ ♪ i will buy you a new car, shiny and new ♪ generosity >> yeah. >> generosity of spirit. good morning, everybody. welcome back to "squawk box. this morning suspense building over president trump's next pick for the supreme court. the president says the nominee will be introduced on monday nbc's chris pallone is in washington with more details this morning good morning >> reporter: president trump and the first lady on the truman balcony celebrating independence day after welcoming military members and their families to the white house. >> thank you for keeping america safe, strong, proud, mighty and

free >> reporter: the president building suspense this past week, playing coy over who will be his next nominee for the supreme court. >> like justice gorsuch, we hit a home run there and we're going to hit a home run here >> reporter: the president narrowed his list to seven candidates with brett kavanaugh and amy comey barrett seen as leaders. >> he will look like justice gorsuch, a known commodity who can be counted on the ideological issues, hard core judicial conservatives and republicans can be enthusiastic about. >> reporter: both sides in t abortion battle are ramping up campaigns. >> roe v. wade is an extremely important issue to me. i consider it to be settled law. i want this nominee to say that it is settled law. >> reporter: four days before the pick the battle already

under way. >> president heads to montana today for a campaign rally joe? the vacancy rate for malls is at the highest level since 2012, but not all retailers are struggling joining us with what's working susharita godlai from forest research good morning, thanks for joining us what is working? we were talking about, it wasn't last week because it was wednesday, we were talking about it on tuesday, sucharita, a lot of the anchor tenants, jcpenney and sears almost antithetical, not working. what causes the individual components of the malls to work? >> what's really happening is that the indoor shopping malls the older malls that we were used to as in our childhood with

the ones that were anchored by the sears and the macy's, those are the ones that are the most challenged you have the newer neighborhood power centers that tend to be anchored from anything say a whole foods to sprouts to a bed, bath & beyond, michael's, best buy, the outdoor centers where the parking is, you know, not in an enclosed space and they have a lot of services. those are really the sectors that are doing better and that's really where the growth in physical retail is, and that's where consumers are spending their money. they often have restaurants, too, that's a huge, huge sector which is driving a lot of the spend in physical goods these days >> i know exactly what you're saying new jersey is like a microcosm places that have a best buy, a whole foods, and like a target and those are, you can't find a parking space, but they're

fundamentally different than the malls where you're walking along, you know, checking out the map before you go in to try to find the footlocker, it's down here to the left past the -- sucharita, the short hills mall is still the greatest place, why >> right there are a handful of malls that are still okay and probably if you look at maybe the top 15% to 20% of the indoor shopping malls, we'll call them the "a" malls they're doing okay and that's because their anchor, they have a nordstrom there, their higher end >> needless markup >> exactly, exactly. they'll have the luxury stores, the louis i havuitton, the tiffany's. 44% growth last year for gucci alone. short hills is doing okay. >> or a dick's and a bed, bath &

beyond in a big parking lot. so that is the way things have sort of diverged now sucharita, you can find out what stocks you can buy, you don't necessarily buy one of the malls anymore. maybe. thank you. we'll see you again soon hopefully. >> okay, thank you coming up, another two big hours right here on "squawk. tomorr tomorrow's job's report, predictions next and 8:15 eastern time an early read on the adp private payroll report "squawk box" returns in just a moment ♪ hold , oni'm coming ♪ i'm coming ♪ hold on, i'm coming running a small business is demanding. and that's why small business owners need more. like internet that's up to the challenge. the gig-speed network from comcast business gives you more.

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trade turmoil. the u.s. set to slap tariffs on chinese goods in less than 24 hours and beijing is fighting back oil shock, president trump calling on opec to reduce pricing now. plus the fortnight obsession, what was once child's play can bring big returns to your portfolio as the second hour of "squawk box" begins right now. ♪ this is gonna be the best day of my life, my life ♪ >> live from the beating heart of business, new york, this is "squawk box. >> good morning, welcome back to "squawk box" here on cnbc, live at the nasdaq market site in

times square look at u.s. equity futures at this hour, dow higher, 156 points and nasdaq up about 38 points higher, s&p 500 up about 15 points higher my man mr. lee is here, we'll show you bitcoin in a minute but hang on for a second couple stories making headlines. the first economic report of the day just coming in, in a little over an hour now adp set to report its june jobs report at 8:15 eastern time. consensus forecast says the u.s. economy added 185,000 new private sector jobs? june and important event for investors coming up at 2:00 p.m. eastern time this afternoon, the fed releasing minutes of its june meeting it decided to raise benchmark interest rates and shares of european carmakers are higher, reports the u.s. offered a solution to the ongoing trade dispute. the u.s. would stop threatening

tariffs on cars imported from the eu if the eu eliminated duties on u.s. cars. we're getting new data on the housing industry diana olick joins us now >> a slight dip in mortgage interest rates did nothing to entice mortgage owners to refinance. refi applications fell 2% for the week and 28% lower than a year ago when interest rates were lower according to the mortgage bankers association volume hit a 20-year low this as the average rate dropped to 4.79% to 4.84% the previous week, borrowers putting 20% down the rates were below 4% for so long that more than half of all the homeowners have rates below 4% according to core logic even the homeowners who might want to tap newfound equity for

renovations or something else are more likely to take out a second loan rather than to refinance their current loan at a higher interest rate home equity lines of credit are increasing as refinances decrease mortgage applications to buy a home were up 1% but lower than a year ago, that has more to do with the chronic housing shortage which is causing home prices to heat up again. prices jumped over 7% annually in may according to core logic, that was the biggest annual price jump in four years heating up again, guys >> all right, thank you very much, diana olick. i think we're going to phil lebeau with breaking news in it's row space sector. >> as many people have expected for a long time, it is finally done between boeing and the brazilian aircraft company embrayer by the way there's still some final details that need to be worked out but in principle

they've got it looked cked in, n owning 80% of the venture. it's valued at $4.75 billion boeing will put in $3.8 billion, its stake in this company and the joint venture basically working on the regional airline component of what embraer brings to the table it will not include business jets or executive jets, and it does not include the military side of the business from embraer. that was a sticking point for a long time. that is separate from this joint venture between boeing and embraer, and again, the deal is finalized. they still need to work out a few final little points, guys, but in essence, this is the deal that people have been expecting for some time. we now have valuation on the company with boeing owning 80% of it valued at $4.75 billion. remember, this is all in response, not all but largely in

response to the agreement between airbus and bombardier, when it comes to production of the c series, which is that smaller commercial airplane that seating between 100 to 140 passengers, the hot part of the market expected to grow rather quickly in the future. boeing with the deal with emb embraer will enter into the market >> is this joint venture considered a separate entity created by embraer and boeing or an actual company or agreement between them i ask you this because i wonder about the golden share by the brazilian government and what role they will have in this, if any. >> still unclear about the golden shares but this is a separate company boeing will own 80%, embraer will own 20% so it's not as though -- this is not a division of boeing, if that's what you're

getting at >> yes >> this is not a division of boeing still haven't named a ceo, likely there will be a name for the joint venture. boeing will have an 80% stak and embraer a 20% stake. >> okay, phil lebeau let's talk broader markets now. here is jeremy xerin, chief u.s. equity strategist for ubs wealth management and tom lee, managing partner. jeremy, it's trade, we're all talking trade. you are still over weight and plan to remain over weight in global u.s. equities as well i guess because your base case is that the trade tensions will be resolved through negotiation, then you say largely because the alternative is so frightening, and it's so disruptive which means if it's not, then we shouldn't be quite as over weight

you're counting on, that's a big assumption to make that this doesn't just keep getting worse with tit-for-tat coming from our trading partners and us. you're pretty sure that won't happen >> i wouldn't say that we're sure joe, what you need to consider there are cross currents are a strong fundamental back drop, are still going to be playing out in the markets with the trade tensions and the trade tensions doesn't mean it reaches an acute point in the next week or two this is likely to play out over an extended period of time with trade negotiations, and i think that this morning's, really illustrates the upside for markets, up more than half a% or the futures are and why? it's because the trade tensions eased a little bit and there's some discussion of negotiations around the auto tariffs. so the fundamental backdrop for stocks is still good earnings are up, should be up around 19%, 20% for the year the economy looks like it grew between 3% and 4%. valuations now are getting more interesting, right we've had almost 20% profit

growth this year and markets up, too, the price-to-earnings ratio for the market is down to 16 times earnings lower than the 2016 election. you put that all together and the risk reward looks good >> '16, sounds like a five-year average for the s&p 500, talking about a 16 forward pe? >> it is an attractive multiple in an interest under 3%. >> shouldn't there be embedded in that valuation a discount for the possibility of a trade war because you make the point that a trade war won't be resolved in two weeks. it almost would be better if there was some resolution bad or good in two weeks as opposed to being dragged on for an undetermined amount of time where the markets will face a lot of uncertainty, and businesses will face uncertainty in terms of making plans >> absolutely right. one of the risks is a bad outcome in trade and the other is business starts to sour, if the view from businesses is that

there will be a very negative outcome. keep in mind, though, all the tariffs we're talking about to date subtract less than one-tenth of a% in gdp even if we get the $30 billion in tariffs tomorrow, which is likely the real risk is significant escalation or the real risk, another secondary risk is the indirect effect of companies starting to rein in their investment spending given the sour sentiment >> at this point i'm almost glad we've highlighted some of the inequities in trade and glad in nato funding i didn't realize it, you see merkel finally conceded a little been she went to 1.5% by 2025. nato was set up to protect germany from the former soviet union and they aren't pitching in basically at all, andrew. places like poland are at 3%, other places at 2.5%

these are, there are some inequities that need to be pointed out. am i right or am i right do i need to withdraw the comment? okay >> no. the question is how do you get -- >> that's what everybody says, no, i saw a guy -- >> absolutely there's inequities that ultimately need to be solved, the question is how do you get there, can you do it gradually. >> i know, i know. >> herky jerky >> i saw your guy from "the washington post. >> who is my guy hold on, the guy last night basically saying, "but you know we want europe to pay more but we're putting all the tariffs on them and being mean to them" and we're not appeasing them the way we used to charles layman you know him anyway, i withdraw the comment i look at you and i think you were right for so long on u.s. equities you stayed long when other people weren't i look at you and all i see is a

bitcoin ball do you wish you hadn't treaded into that arena? you must get tons of mail one way or another on this what is your forecast, 100,000 >> 25,000. >> is that where you were going to go? i went there for you >> i was going right there that's where i wanted to go. i feel like we missed it remember when i said we should buy some when it was under 6,000. were you here for this >> you liked it at 10,000, you were most excited. you were most excited on 10,000. >> mohammad el erian was on and he said he was waiting for five. i said you're getting greedy, wait for six, and he got it. >> first of all, we still do equities >> do you regret you ever made any comments on this >> no, i don't, because to me, digital money and blockchain is a multidecade story. i think we're in the early

stages and this is not that different than -- >> 1970s though. >> it might be the '80s, and i did wireless in the '90s, so i saw, you know, 20 years of mobile and internet convergence. to me this is not that different. i think the reason bitcoin looks really good here is the cost of mining is around 7,000 fully loaded and the difficulty is rising by the end of the year it will be close to 9,000. bitcoin's historically traded at 2 1/2 times its mining cost so it's not out of the question it could be over 20,000 by the end of the year, at fair value, and in six months, bitcoin's made a lot of -- >> sounds like you're backing down from your forecast, could be over 20 grand by the end of the year before, it was 25 grand definitively >> let's just think about keeping it in perspective, from 6,000 to anything positive is a huge increase from where sentiment believes bitcoin is.

today, people think bitcoin's already broken it's working fine. there's billions of dollars a week of transactions on the chain, so -- >> one question about the mining story. this idea we're at $7,000 and one of the reasons we're at $7,000 is electricity costs and the cost to get the chips. >> it gets more difficult, too >> keeps getting more and more difficult. >> fewer bitcoin to find >> part of the issue people jumped into this at one time could there be a moment at which there's an oversupply of miners, if you will? >> yes, that's when you see, what you're seeing is a jump in hash power because there was a lot of mining coming in. >> could there ever be hash power taken out? >> yes and the difficulty would adjust, but today it's still profitable for someone who has an s9, the latest chip, to actually mine bitcoin because their all-in cost is 4,000 it's the legacy equipment that's

less profitable. >> how about stocks? >> we still like equities. >> that's all the time we have see? don't you wish you had some? unbelievable we'll be back and talk more about that bitcoin is a real buzzword and so is the 2020 election, with the entrance of this new candidate, michael avenatti is going to run you're on the band wagon right now for this, stormy daniels' attorney do you believe the world we're living in right now, sorkin? >> no, i can't believe the world right now. >> he's going to just walk away with that nomination i think actually jeremy, thank you. can you believe this >> i can't believe just about anything right now >> is there any news you'd read and say no, that's not possible. nothing would surprise me. nothing. nothing. >> like an alternative universe. coming up, trade wars, the

u.s. ready to launch new ptariff on chinese goods and china acpected to fire bk. you're watching "squawk box" here on cnbc we all want to know about the new thing.

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sitting down 25% tariff expected on u.s. so i bea soy beans. joining us is eric bransted, chief aide as secretary to wilbur ross. good morning to you. >> good morning. welcome. >> there's so much to talk about when it comes to trade i don't know if we want to go to directly to what's going on in europe, overnight the automobile industry, but let me ask you sort of broader topic question, which is, and joe and i were going back and forth on this there's clearly inequities that i think everybody agrees exist that do need to be fixed and the question is, i think, but maybe i'm wrong, is the issue the inequities themselves or is the issue how we go about fixing these inequities that you think has so many people up in arms >> well, certainly both.

first of all, you've got decades of issues, of problems with the trade. the trade deficit has grown to $375 billion this cannot go on any longer >> but in terms of how we go about it the question of why so many people seem to be frustrated how this is approached i guess the question is, is there a way to address the inequities without doing it, without upsetting our allies in the way that we seem to have done >> well, we have leadership from both sidesworking together, both the delegation from the united states, the delegation from china, the dialogue has been going on now for a long time, and it's been good dialogue, but they've got to come together and we've got to

find a way to fix these issues that's been going on for decades. $375 billion trade deficit is far too big. we must get to a place where we can shrink that deficit and fix some of the longstanding issues that the president has been talking about for years. >> let me ask you this on china, and the issue with farmers right now. is our biggest problem the inequity when it comes to farmers or intellectual property that is a fundamental issue in terms of thinking about the two disparate groups when it comes to employment in the united states >> the formers are the ones that the chinese are going after, the low hanging fruit they've seen as having a big impact to the united states. you have soy beans, you've got pork we have to figure out a way in

which we can work together and solve the big problems, the big issues the chinese are going after the pork and the soybeans. we're going to stay strong the president is strong on fixing these issues that have been going on for far too long >> eric, we appreciate your time this morning always appreciate your per spec tif perspective, wish you a happy fourth >> thank you very much, happy fourth to you. coming up, what just happened in kentucky that left 10,000 barrels of bourbon crashing to the ground pictures that you have to see to believe when we return ♪ one bourbon, one scotch, one beer ♪ time for today's aflac trivia question. what tech giant was founded on this day in 1994 the answer when cnbc "squawk box" continues break a leg!

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squawk business two weeks ago we showed you a picture of a bourbon warehouse that partially collapsed in kentucky. yesterday the other half of the distillery came crashing down. 9,000 barrels tumbled to the ground two weeks ago an estimated 10,000 fell yesterday. fish and wildlife officials are working to minimize the impact as the bourbon ran downhill from the distillery into local streams so you can make your own, i don't know, joke about that >> drunken fish. >> would you add some vermouth to the streams >> you see the drone shot? beautiful shot anyway coming up, president trump calling on opec to reduce oil prices, we'll talk with a top energy watcher, next

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♪ one foot in front of the other ♪ ♪ one foot in front of the other ♪

♪ one foot in front of the other ♪ good morning, welcome back to "squawk box" right here on cnbc, we're live at the nasdaq market site in times square. stories front and center, boeing and embraer finalized a joint venture deal after months of -- what did i do? >> i was bracing myself for a comment from joe actually. >> i don't comment you know those jets, right those are the ones that do all the short hauls, they're very, i like -- there's -- you wouldn't like it, they don't have, there's no front to ride in, but they board and deplane so quickly and you get out there quick, you get back. it's not the big process that you go through on the big jets, you know what i mean >> what kind of big jets are you talking about? >> you don't know any commercial --

>> teterboro >> this is all foreign to you. >> i don't know what you're talking about. are there other people in the plane? >> yeah, that point you mean besides the pilots that 0.1%, he can't get rid of the echo in his foyer. >> cavernous and marble. too much marble and way too big. when you have a 1500 square foot, what are you going to do >> were you watching >> yes >> 0.1%, great >> great sitcom, it really would be >> i'm usually not funny >> that's true you're funny when you don't try to be. >> effortlessly funny. >> let me tell you about the airplanes that i don't know anything about by the way, i'm getting on a jetblue plane tomorrow >> really? >> boeing owning 80% and embraer

owning 20%, the total value of the company $4.75 billion. i was wondering if i could pay extra for the extra leg room seat i'm going to california tomorrow the co-chairman of china's hna group died in what appears to be an accident. he fell, wang jian was on a business trip to france and fell from a wall while posing for a photograph he held a 15% stake and was in charge of strategy and day-to-day operations. lots of questions about what's going to happen to the future of that company and really just a sad, terrible story of how he was trying to get up on the edge of it was a church, right? >> it was a cliffside church in france >> trying to get the shot and then fell 50 feet. also a major deal struck by ride hailing service uber may have to be unwound earlier this year uber sold its southeast asian business to regional rival grab in exchange for a stake in the company

regulators say the deal substantially lessened competition there and proposing fines against the two companies and warning the deal may have to be undone. wimbledon is in full swing in england and cnbc's adam reed joins us from there. got to catch a little of it. it's shaping up to be a pretty good, a little rain yesterday but it's been really dry up to this point, but the courts seem like they're in great condition. adam >> reporter: yes, it's absolutely beautiful at wimbledon, at this time of year, despite what you may think about the rain coming down too often, the sun is beating down at the moment, and day four of the championships already under way. over my shoulder you can probably see fans still streaming in, even though play is already under way hundreds if not a thousand or so fans queueing overnight to get the last few remaining tickets for the centre court, number one courts, which will be featuring today amongst others novak joke vick and rafa nadal, former

champions as well as the top seed in the women's draw, ci sin halep. wimbledon with its bright green lawns and huge amount of tradition as well, just to let you know as well, the young american, francis tiafoe has his second round under way and looking to follow up the impressive first round victory over fernandoer ha verdasco. he is up against julian benetteau. roger federer looked in supreme form, even saying he was trying out some shots that he wouldn't normally play, i guess obviously to stop himself from getting a little bit bored exciting times here, half a million spectators expected through the gates during the two-week period, around about

that figure and a huge amount of strawberries consumed, 166,000 they're expected to serve as well >> thank you, adam it was that was a hardship assignment. sorry. >> exactly >> one of the great things to go to >> it is >> did you see the list of food, did you read that? more than 4,000 pounds of bananas. look, for the players, 4,800 pounds of bananas. >> federer is getting paid $300,000 to wear uniqlo clothes. >> federer has won 20 straight sets, he's 36 years old. hasn't lost a set. >> he's getting $300 million irrespective of whether he plays. he's given up nike who will he get a steeper contract with, that's a fascinating issue. the sneaker guys want the sneakers and the clothes if you only have the clothes and still wearing the nike sneakers, he wants his "rf" logo back.

does he get it does he have to change it? >> more interested whether he wins wimbledomeimbledon at 36 a, happily married and the baby venus started out slow but won handily. are you watching any of the actual -- you're watching the dollars? >> i'm watching the money and i have a suggestion for the uniqlo people i've been thinking about this all day. >> all day all day. >> it's so ugly the clothes he's hearing with the uniqlo logo every which way. >> i wish we had an example of it >> can we show it? there's a wonderful ceo who runs uniqlo most of the clothes have no logo i think they should do no logo and you look and go that looks so cool, what is he wearing, i will now go to uniqlo to find out. >> you think it's ugly or what is he wearing in a bad way >> what he's wearing in a good way. >> because you think the clothes --

>> go to the uniqlo website they don't advertise the clothes he's hearing. the whole thing makes no sense sorry. i was watching wimbledon yesterday and this is all i was thinking about it made me crazy >> he's wearing nike there >> $300 million doesn't include the sneakers >> no, the $300 million is just the clothes because they don't make sneakers and so he's wearing the nike sneakers for free, nike is not going to give him a deal, they're upset about this whole thing the question is whether adidas or somebody else would come in or prince would give him a deal for the sneakers separately. you can't advertise the whole ensemble, if you will. >> that's a racket >> that's a racket for tennis, b bingo. >> ba-dum-bum. i didn't know andrew was so passionate about this, really. >> i want them to make uniqlo tennis clothes without logos for roger. >> got it. >> there it is how ugly is that the ugliest thing i've seen. >> it's not that bad

i thought it would be way uglier >> patches on his arms, ridiculous apparently you can sell patches which is worse, like nascar on -- >> it's getting there. >> -- the tennis court >> you've seen the other styles of people that had careers like him. he's the most graceful sort of old -- he's not 6'8" with the serve and stuff like that. he's just, you know, he's a treasure >> he's a treasure >> you don't worry about that logo >> he'll make the clothes look good >> the one-handed backhand, who still does it that -- i mean he's -- treasure him >> i am treasure him i'd treasure him more if he took the logos off. you would think anna would be telling him what to do with the fashion. >> why she's got the big ugly glasses and the weird hairdo for the last 40 years. >> oh, okay. back to opec

let's bring in john. president trump calling to reduce pricing the opec monopoly must remember gas prices are up and they are driving prices higher as the united states defends many of their members for very little money. this must be a two-way street, reduce pricing now earlier this morning iran's opec governor said president trump's tweets have increased prices by at least $10, and is quoted as saying please stop this method joining us john kildoff, cnbc contributor. good to have you can us. >> good morning, melissa >> all things a racket >> that was a good one that was a good one. >> i try >> do you buy that, his tweets have increased prices by ten bucks a barrel >> i don't know if i do or don't but i love that president trump is rattling their cage so badly. i mean they are just reacting to all of this to a person over there, severely, and this latest protest about ten bucks a barrel, i think what has raised

prices ten bucks a barrel is more the administration's policy about getting their exports completely cut off to the rest of the world, which they seem intent on. i'll tell you there's a lot of folks who are reading the latest state department commentary about waivers i think too generously the trump administration in my view is hard core, and are on a path to try to limit those remaining exports to a trickle, if they can. >> it seems like a strange push/pull on the administration's part in terms of begging allies to reduce iranian purchases to zero, which takes barrels off the market and trump then saying to the saudis, you should increase production because you have spare capacity, because they're basically asking opec members to sort of support this iranian sanction move >> that's right, and it shows the schism within opec, shows the enmity between saudi arabia and iran

if there's a miscalculation on the administration's part with k saudi arabia fill the gap if we lose the iranian barrels if the price continues to rise by i unfortunately think it's going to, this market is tight already, getting tighter and we can't afford any more outages. this is hurricane season we get a storm stumbling into the gulf of mexico they'll shut down production for a time not that there will be lasting damage but they evacuate the platforms as a method of operation. >> what is your view on the impact of trade tensions on global oil morgan stanley last week said there could be impact. goldman sachs saying there should be no impact here and at the same time we're not seeing any reaction in oil except higher, but on other commodities like platinum, zinc, copper. >> soybeans. >> soybeans, we are seeing impact >> china has been one of our biggest buyer in terms of crude

oil exports. oil did take a hit when china first announced its list of retr retaliatory tariffs. we could see oil prices get depressed for a time on that front. if there's a worry for oil, it's a, the lack of buying from china but the hit to the global economy that could be under way. demand has been so strong and the outages so severe at this point, that it's still a tight setup for now. so i think it's going to be a rough, hot summer and potentially a rough ride come the fall and winter. >> how bad how high could we go >> 85 is certainly of ati and maybe as high as 90 for brent. at least for a time until we can get this fever to break, get this canadian situation resolved for example here, but unless we can get better clarity on how much iranian oil is coming off the market we're living on the edge >> john, thanks, john kilduff. >> living on the edge.

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welcome back to "squawk box. two-time cnbc disruptor, ginko bioworks partnering with the government good morning to you. >> good morning, thank you for having me on. >> happy fourth. >> thank you >> tell us what you're doing with the government. >> yeah, so if you remember ginko designs gmos by designing and printing more synthetic dna than anyone else on the planet, right down the street here in boston and as a result we have a really good idea what it looks like when you genetically engineer an organism two new projects totalling up to $64 million in government contracts with the defense industry and one is to detect if

you were to find a cell, like say anthrax in the capital building or something, and the question is, is it something that was engineered or is it something that just rose up in the wild, is it a pathogen that emerged from nature and the second project is sort of like an anti-virus detector when you get an email in gmail, you have an attachment, does this have a virus, similar idea if you were to submit a squeeequence of dna printer, is it dangerous, something that might make a toxin or pathogenic, you have an algorithm and if it's bad you don't print it those are two projects >> is this a testing business effectively, they'll bring you different things to test >> it's a little more, it will ultimately be a software algorithm. it's kind of a side effect of ginko being the largest designer of dna in the world.

we have a huge internal database of design dna so the database can be used to build an algorithm that says is this engineered or not, is this safe or not and so as a result, we can hand that off to partners. we're working with northrop grumman and battel who could build that into the defense department to do the screening they'd receive a sample, test it and determine if it was safe >> i hate to ask this next question because it will only give people ideas but what is the worst thing you've heard of out there in terms of people using this technology for bad, if you will? >> yes, i mean i think -- sort of there's a history sort of back in the early part of the last century, people were working with states were working on things like biological weapons. that got shut down there's an international bioweapons convention that prevents that now globally, and

i think we've been, that's been pretty well respected. i think people sort of feel like that's a place we don't really want to go, but i think what's happening is as the cost to do this work falls and the tools get better, i think there's a fair, i think a healthy concern that it's going to be harder to control that so we need new tools to keep an eye on, if people are developing things like that. and so i think in particular, you don't want to see people working on anything that's really a pathogenic organism >> in a perfect world, that would be great i think amy gutman, president of pen, headed up the whole symposium you're talking about, about safety on that but we had craig ventor here for one of our health care conferences, and he could definitely, if he was an evil scientist, if he was evil, if he was a sociopath, he could figure out how to do that

he'd need help but it just makes me a little bit worried, because if it's possible to do it, it just seems like it will be done by, you know, you can't assume that everyone is well-intentioned, and you know, has the best interests of humanity out there, taken woandt worries me the technology is there now to put something into a, you know, something pathogenic into something that's really easily transmittable, like i don't know, to modify a bird flu so it goes to humans or modify -- who knows, it's possible to do it now and that's frightening >> yes no, i think, so i think you're not wrong and that's why we need to build these tools out, and the national academy of science put out a study out about a month ago that said in the era of synthetic biology of these falling costs for biotech, what does that mean for biological weapons? they rank listed things they were concerned about, and you

know, like for example you can now because you can print dna could you bring back a virus we put in the freezer and got rid of >> smallpox, i know exactly, i mean -- >> well they've got it in the freezer. could somebody else now bring it back >> the samples but you have the dna blueprint you could synthesize it for a smaller amount it's frightening work hard, will you? why are you on tv? get back to -- >> he's doing the real ju passic park stuff scary. >> inspired by the original. he was inspired by the original to get into this, right? fascinating. >> what do you make of the latest i love liam malcolm is back. jurassic park is this for a genetic engineer the best and to me it's two reasons -- one, it creates wonder about biology we take biology for granted when

it's this unbelievably powerful technology and you see a bro brontosaur us rolling up, it makes you realize how important and powerful biology is and secondly this, "life will find a way. be humble. like when we're working with biology we have to understand its importance we should be humble about it thanks, guys >> you bet coming up, if you thought video games were nothing more than child's play, investors are crashing on the craze. the games you need to know, next you always pay your insurance on time. tap one little bumper and up go your rates. what good is your insurance if you get punished for using it? news flash: nobody's perfect. for drivers with accident forgiveness, liberty mutual won't raise your rates

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soapy might say it's leaving the video game console, but nintendo releases its retroconsole rush is founder of the website polygon. i know about fortnight but i don't know the other big trends happening right now. the portable era, what defined the portable era and why do you think it's less important now? >> sure. yes so for many years nintendo roomed the roost, sold gameboys by the ton, anyone tnintendo ds

well now they have a console/handheld >> it's not not portable but in conjunction with -- >> people realize if you have a dedicated hand held device it limits you nintendo has to make games for the portable and the console now they can pool resources into this one platform and it's easier >> what did we learn from fortnight? what is everybody trying to do now? >> fortnight tremendous success, i don't think there's question about that the big thing we've learned is that people do not like being locked into the platform that they are playing the game on example. you can play fortnight on your phone, on your console, on your pc, you name it, and your progress carries from platform to platform and people love this it's like how people use netf x netflix. they are not locked in to watching on their tv or their computer >> and you're also not done spending money when you get the original for it. there's always something more to

buy. >> they built this genius model. lootbox is a gambling mechanic where you can put money into a slot machine and maybe get something you want fo fortnite allows you to spend money and you know what you're getting but it's a steady stream of new things they're offering people, it's like a new line at uniqlo >> is there anybody else coming up with anything like this is this a model now you think could be replicated? >> people are trying there's a popular game pub g for short and they copied and pasted essentially this model into pub g. it has not been as successful for a number of reasons, but i think people are definitely trying to follow fortnite. >> what is a game good for them? >> minekrcraft is not bad for kd in moderation. you can learn some mechanical

largical things in minecraft fortnite does do, parents are like why are these kids playing? it basically allows communication and direction. >> socially responsible game we could have teaches kids about climate change and -- >> we could have it. >> reduce your emissions while you play >> my kids are playing road blocks, they're crazy about road blocks >> that's the middle ground between minecraft and fortnite they're building their way up there. coming up, when we return, is a trade war brewing we'll tell you there's 24 hours before us new tariffs and chinese odgos could go into effect back in a moment

breaking economic news a read on private sector numbers minutes away one day to go, u.s. tariffs on chinese goods go into effect tomorrow and china is ready to strike back. live report from beijing straight ahead plus it's back the big reveal of cnbc's top state for business is coming we'll tell you how states are pitching themselves to executive, the final hour of "squawk box" begins right now.

♪ thunder, feel the thunder ♪ lightning and the thunder >> live from the post powerful city in the world, new york, this is "squawk box. ♪ thunder >> good morning, and welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square i'm joe kernen along with andrew ross sorkin and melissa lee. becky is off and i think back tomorrow >> back tomorrow >> are you in tomorrow >> i'm in tomorrow >> but then you're leaving or something. >> yep, i'm sure you're gonna miss me. >> is it oscar weekend did that sneak up on me? >> no, no, no. take a look at the futures now >> i don't know why you're going out there. well, never mind, but i know you're out part of next week >> part of next week, too. on assignment. >> you can't tell me anything? it's personal? >> no. >> you'd have to kill me, all right.

futures up almost 200 on the dow jones. it's not oscar week? >> no. >> comicon >> no, zero. >> s&p is up 19.5. nasdaq strong up 52. treasury yields continue to sort of confound people are we really going to be at 3.25 by the end of the year? that's what everyone says. would you bet on that now, melissa? >> i'm not sure. i don't know the fed is going to raise, though, two more times >> but are they controlling when you're tethered in europe. you're tethered in germany basis points >> i agree with you. >> you do? >> yeah. >> there's another way of saying that >> you're right, joe >> yes >> over my dead body >> in the meantime, let's get you through the headlines. president trump calling on opec to reduce pricing now. sweeting "the opec monopoly must remember gas prices you were and they are doing little to help. if anything they're driving prices higher as the united states defends many of their

members for very little money. this must be a two-way street. reduce pricing now," exclamation point, it comes days after the u.s. and saudi arabia discuss the possibility of the kingdom releasing more of its own crude to dampen rising prices. wti crude at 74.61 and breaking the last hour, boeing and brazilian jetmaker embraer finalized a joint venture deal it will be a separate company with boeing owning 80% and embraer owning 20% the total value of the company will be $4.75 billion. the "wall street journal" reporting zte named a new ceo to get a supply ban lifted. in april they were forced to halt most operations after the u.s. hit the smartphone maker with the ban executives conspired to evade sanctions on iran and north korea. wilbur ross broke the news they

made a deal with zte and said for the first time they would be installing their own monitors, and this is part of that the u.s. will impose tariffs on $34 billion in chinese imports tomorrow and china says it will promptly strike back eunice yoon is in beijing. >> china doesn't want to be the one to fire the first shot in a trade war. it originally planned to impose its tariffs around midnight friday in china. however, in order to match the 12:01 start time that was discussed by the u.s however, because of the time difference, july 6th here comes ahead of july 6th inthe united states, the chinese government said they're going to now delay the tariffs until what they said immediately after the u.s. imposes theirs now that cabinet said that china absolutely won't fire the first shot, taken means that china is

going to end up imposing its tariffs around noontime in beijing. now, this is unusual for customs reasons, and it's also really shows just how sensitive beijing is to this idea that it could be perceived as the aggressor it wants to make sure that it's seen as the victim, as the hurt party, and that it's the good guy here, in a way to gain support in this fight with president trump. now, in just less than 16 hours, both countries are going to be imposing tariffs, up to 25% on $34 billion worth of goods the u.s. will punish chinese made high-tech among other products and the chinese are going to be striking back largely at farm goods, targeting president trump's political base, so what can the chinese do now in order to gird themselves from this tit-for-tat tariff spat lot of people have been saying we could see more the chinese actually devaluing its currency in order to try to support its

exports, that way it makes it much cheaper for exporters however, there are a lot of people saying that won't be the case the yuan did hit its weakest level in almost a year this week there's also talk the chinese could potentially loosen policy even further, and we've already seen that today. either way, investors here are worried about the impact of the trade war. we've already seen the stock market hit multiyear lows. guys >> yes, we're talking about this all day long, it's binary the whole trade discussion really binary. there's no in between. either going to be worked out, negotiated or going to be, you know, horrible, one or the other. that's what we decided and it makes a difference to people that invest money, i think, right? i wish you could tell us but you don't know, do you >> yes >> you do know >> no, i think nobody knows. nobody knows, and that's why a lot of companies especially here who are american companies based

in china are just bracing themselves for anything. so i've talked to a lot of people a lot of executives and they said they're expecting anything from getting squeezed even tougher on the ports, having their products inspected even more. there have been a lot of reports about how that's already been going on, and so they're thinking okay, am i going to have to then either once the tariffs are imposed am i going to be able to pass along this tariff and the cost to the consumer am i going to have to eat it myself or am i going to try to find another way to source my products there's a lot of conversations going on, just because it is so uncertain. >> i got a couple of guys here that think they know some stuff about this, eunice we'll see. thank you. you might leave your ifb and join us, stephen whiting, from city private bank, global chief investment strategist. big bank, and chris cordeiro, regent atlantic capital. chris i already read some of

your stuff, we'll get to it in a second you're like there's a lot of background noise, some of it is on the positive. ignore it and just adjust your portfolio and you need someone like him to help you that's why he's here let me say start with stephen. this plays right into what we were saying, the first bullet point here the scope of the administration's trade battle is widening beyond our original assumptions. i guess originally you thought it was going to be a negotiated settlement wasn't going to be a problem now the worst case scenario has become more possible in citigroup's mind or something? >> we think about it this way. look at the tax cuts there was a lot of drama for about a year ultimately passing corporate tax cuts so we have to be prepared for this to go on longer if, for example, we move to put tariffs on auto imports, the scope of the impact would roughly triple from the steel and aluminum tariffs

there's a lot of affiliated impact think about auto dialer e auto it stop there, continue? we're not in a sustainable situation if we're going to have escalating retaliation step by stepover the coming year, and could you see today how reactive markets are to this. you can't certainly say that german auto producers can negotiate for the eu this takes, can take a long time >> so you've broadened, it sounds like in broadening your expectations of what can happen, the downside expectations have become more pronounced >> certainly possible. and we have to follow right now the story very, very closely if the administration is going to go ahead with the auto tariffs for example, after dealing with the fallout from agriculture, then it's probably signaling it's willing to accept some sacrifice for domestic business in order to pursue this >> okay. chris, here's what i was talking

about. geopolitical risk from the white house, plays into the hands of the pessimist but earnings growth plays in the hands of the optimi optimist ignore them both and be a realist. great to take stock and let regent atlantic capital handle your money >> that sounds like a great deal >> you're saying ignore, readjust your portfolio in individual names that have their own stories? >> and overall asset classes i think you look at pessimist and the optimists and have to be a realist and look at what's cheap. >> what is cheap >> emerging markets overall asset class is extremely cheap >> that's counter intuitive. you think if there's trade wars you want to stay domestic. >> you would, but the emerging markets trade far more within each other than they do with us. >> the dollar, though? >> the dollar is going to hurt them but to think about the optimistics, we're going to win this trade more, i'm not completely sure of that. when constructing a portfolio, i

want to have both domestic stocks and foreign stocks. i look at foreign stocks, emerging markets the cheapest and they was strong earnings growth >> wow, you like ford, huh >> look at how cheap ford is again, you've got to look at some part of this trade stuff is way overblown. >> okay. you like google, you like alphabet, energy, too? >> yes so you've got alphabet just really strong tech stock for a tech stock, where you've got a lot of other tech stocks who unprofitable but still have rich prices >> all right just back to steven, we have to leave. so gdp, i don't know what your assumption is for this year, next year, and the year after. how much does trade and everything that's happening with the trade, what does it cut off what gdp would have been >> if it goes to some quick deals, right, the impact in the end is going to be 0.2% on the

united states. if we spend the next two years when we're already very, very deep into an expansion where we already have some domestic inflationary pressures and you spend two years doing this, you can really suppress a good deal more, and you can come in at numbers easily taken one to two percentage points. >> what? >> you could do that over a couple of years. globally and if you have an accelerating impact. >> thank you, chris, thank you coming up, adp breaking some news stay tuned introducing e*trade personalized investments professionally managed portfolios customized to help meet your financial goals. you'll know what you're invested in and how it's performing. so you can spend more time floating about on your inflatable swan. [ding]

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the u.s. economy added 1 7,000 new private sector jobs in june, that falls short of the consensus estimate of 185,000, but the main number revised higher to 189,000 from the originally reported 178,000. let's break down some of the components of the report, a goods producing industries added 29,000 jobs with 148,000 from service companies, all of this of course comes ahead of tomorrow's government employment report for june, consensus forecast for that report called

for 195,000 new non-farm jobs for the month, with the unemployment rate holding steady at 3.8%. some other data from the adp report small businesses adding 29,000 jobs during the month with 8 o,000 by medium sized companies, 69,000 by large businesses and breaking it down by industry, education and health services saw 46,000 new jobs during the month, leisure and hospitality added 33,000 24,000 new jobs meantime in trade and transport. 13,000 in construction, 12,000 in manufacturing joining us now more analysis on adp, mark zandi, moody's analytics. >> good morning. >> do you think it forecasts anything for the jobs report tomorrow >> it's all good lots of jobs, still job creation is close to a couple hundred thousand per month which is, you know, double the rate of the growth in the labor force so unemployment, which is 3.8% will continue to decline.

so you know, if all the trend lines continue and everything looks like they will for the foreseeable future we'll be into the low threes by late next year >> do you think we'll see any sort of pickup in wage growth in tomorrow's report? >> i don't know about tomorrow's report but wage growth has picked up. if you go back say three, four years ago. >> further pickup i should say >> three, four years ago wage growth look at the plethora of the day tax was 1.5% to 2%, on a per annum basis. year from now we'll be consistently over 3. one really interesting statistic coming out of the adp data is that the wage gains for new entrants into the workforce is accelerating very rapidly. in fact that's picked up quite a bit over the last 9, 12 months so i think that's a pretty good leading indicator for wage growth for other folks in the labor force so employers are

paying more for bringing new entrants into their companies, they have to start jacking uhm wages for everyone i think wage growth will pick up substantially >> as we go into the jobs report tomorrow, mark, we'll get the fomc minutes this afternoon. i'm curious what you'd be looking for out of the meeting in terms of any guidance on what to expect. i know we had a press conference the last meeting so maybe there aren't so many question marks but as soon as that crosses, mark, what are you looking for >> trade what do they think about all this trade stuff i mean, hard to disentangle. none of it is good nothing but downside in my view but key to what the policy makers think how much downside is there like a tax increase. you're raising the price of all the imported goods consumers are buying and as a result, you're weighing on growth and adding to inflation. it's really makes life difficult for the federal reserve. i'm reallycurious to see if we

learn any more about how they're think being thi thinking about this. >> if the fed doesn't show up in the economic data the impact from trade, would the fed hold back on a rate hike, do you think, this year, just as a precaution >> no. >> to raise no matter what >> well it's tough you're at 3.8 on the unemployment rate. it is going into the low 3s. there's only two other times in history we've been there, we've been in wars when that was gone on, world war ii and the korean war. i think the federal reserve really is going to look through most of everything and focus on that, because if they don't, this economy is going to overheat and we'll end up back in recession and the odds of that are already rising significantly. it's going to be tough for them to land this plane >> even with the impact or potential inflationary impact from a trade war you think we go ahead no matter what >> well, if they focus on the inflationary impact of the trade war that reinforces the need for them to normalize policy more

quickly. if they focus on the growth effects then maybe not so much, but i think when they add it up, they just got to get this interest rates up otherwise we're going to have an economy that is going to have wage price pressures and this economy is just going to overheat so they really have very little choice here, in my view >> mark, we'll leave it there, thank you. mark zandi, moody's. >> thank you coming up, it's that time of the year we're getting ready to roll out cnbc's top states for business scott cohn will tell us everything you need to know about the rankings and the number one state -- no, he's not going to tell us that. he's going to drag this out. we'll find out, what month is it june no, it's july. >> july. >> i think november, anyway he'll join us next

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well come back to "squawk box. futures solid all morning long we almost got to 200 last time we look. we are there now 204 on the dow. the s&p is indicated up 20.5 and the nasdaq indicated up almost 60 oil prices talking about that with john kilduff a little while ago, 74.42 and it's reflected at the pump, where i did put 93 in again. >> even though you were told by an expert that it was not necessary unless the manual

says >> what are you doing? you're incinerating the money. >> you can give me the money if you don't need it. >> a high performance car. and it's not an suv. >> the front page of the "wall street journal" a hedge fund star dims, and investors flee, outlining the hard time for david einhorn, greenlight's assets shrunk from a reported $12 billion back in 2014 they spoke to more than a dozen former investors and employees and other sources who are threatening to exit if the funds results don't rebound. they attribute einhorn's troubles to sticking to high value stocks over growth stocks. one investor raised concerns about his divorce and his sleeping habits. einhorn told investors earlier this year he had been shortening stocks like amazon and netflix,

all of them went up. we should say the story says he has a sleeping disorder, which keeps him, has him wake up at 3:00 in the morning. >> and naps in the middle of the afternoon, can't stay awake for meetings >> what is remarkable, they have people on the record saying my patience is wearing thin this is unbelievable others who say all sorts of things the $5.5 billion by the way and by the way we should say gregory zuckerman wrote this piece, we've had him on the show many times, really it sounds there's only $3.5 billion of outside money because it's about $1 billion of his own money and another billion from the reinsurance fund which he controls >> right >> so wait a minute. he wakes up at 3:00 in the morning. >> to work >> and naps in the afternoon >> you know somebody like that >> what does it say that it happens to a person who happens to do that >> i don't know.

>> performance goes down >> andrew, i remember when he was hot and this is like five years ago. >> yes >> i remember reading -- >> 58% at one point. >> some of so the stuff he was doing, he loved gold >> he loved sun edison which went into the ground >> i don't manage money. i used to, i was a broker for a while but some of his trades looked really stupid to me back then so i don't know >> so apparently the fund dropped 7.7% in june, down 18.7% for the year the s&p 500 -- >> up 2% >> we know where that is relative to what's going on. peter weiss, a boston investor says "he's stubborn. he'll never admit he's made a mistake, just makes me crazy." >> that's the reason why you shouldn't invest with him then >> einhorn when we make a mistake we recognize our position and exit. it's a lot of back-and-forth

it's rare where you get people on the record. >> who knows, maybe this is the bottom for this guy. >> this one was fascinating, another investor says "if someone usually goes through divorce i usually get out and i made an exception with david but i made a mistake he has to be distracted. i'm convinced that's 30% to 40% why the stock down." not the stock but the performance is down. but we should say david einhorn says he is completely and utterly focused. coming up, weekly jobless claims about to hit the table. we'll bring you the numbers when we return. you always pay your insurance on time.

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welcome back to "squawk box. breaking news, 231,000, up 3,000 from an upward revised 228 which was last week at 227 if we look a week in arrears, 1.739 million is continuing claims, and that is up a bit from just shy of 1.71 million. these numbers are moving up a smidge but keep in mind they are

historically on a small side, hovering 285 in yields the big number this morning in front of tomorrow's second big employment number 177,000, it was interesting, the second weakest number of the year, the weakest is 163,000 in april. we'll continue to monitor of course, equities looking strong and the dollar index giving back a big chunk here, looks to be down close to half a cent. joe, becky, the whole gang i'm not sure if becky is there joe, andrew, back to you >> she'll be back tomorrow, rick so you have a very good forecast there. predicted to be here tomorrow. days away from the cnbc's 12th annual america's top states for business rankings, and with the winning state to be revealed for the first time right here on "squawk box," but not today. scott cohn here, on live tv, do

you ever worry you might blurt it out, just lose control and just, have you ever come close to doing that? how do you know you'll be able to control -- you know what it is, you know all along and constantly trying to keep it from us. i think you might slip sometime. >> i might but chances are i might not. no, i've never been tempted to blurt it out many people do not know. we like it that way. here's what we do, we rate the states or try to rate the states on the qualities that they use that they use to sell themselves, so what we do is talk about workforce for example, that carries more weight and we do this across ten categories of competitiveness, and now we have more than 60 metrics across the categories, really no one puts the states through their paces the way that we do. 2500 possible points and the

state with the most points is where i will be, starting on monday it is america's top state for business now, we like to gut check our findings and our categories and how we weight the categories every year, so we turn to our cnbc global cfo council. 25 cfos from private and public companies a cross-section to look at what they're looking at when looking for a location and sure enough two-thirds say workforce is their top priority, cost of doing business is a distant second followed by access to capital and business friendliness we asked whether companies are having trouble finding skilled workers and this whole situation with the skills gap and work shortage, worker shortage, 83% say yes. workforce is one of the things we look at as we measure america's top businesses, ten categories of competitiveness. we will be live in the winning state starting on monday with top state revealed tuesday morning right around this time, right here on "squawk box," and

then you'll be able to see where your state stacks up and top states on cnbc.com so keep guessing >> you got anything for us at all? >> you try this every year for how long, joe? have you ever gotten a single little tip from scott cohn the man is like a vault. >> i'm working with him trying to play along with it. is it bigger than a bread basket >> yes, it's bigger than a bread basket it's a state, joe. >> okay, you can do this is it a red state or a blue state? >> it's a state, joe >> is it, uhm, landlocked? >> is it landlocked? no, see, that, i'm not going to say that >> see, that pause -- >> i'll tell what we're going to do >> almost land locked and he had to think about it for a second >> michigan, could be on the great lakes. wisconsin? >> i'm not taking anything from the pause.

>> no? >> that's probably wise, early in the morning >> does it start with an "n" there's a lot of states with the "n." >> this is monot wheel of fortue >> what do you think it is from your travels around, what do you think >> it's not new jersey i atell you that >> i'm thinking vermont. >> vermont >> they got one company i think. >> ben & jerry's it isn't based in vermont anymore. but owned by unilever. >> probably short list of an amazon headquarter of the list, one of those companies >> you can confirm that, scott >> well, there are 20, so there are 20 finalists for the amazon headquarters, could be one of them two of them are not in states, so that's washington, d.c., and toronto, ontario >> that's interesting. >> but otherwise it could be one of those 18. >> what do you think of massachusetts these days >> what's that

>> is he try igto guess? >> no, because everybody thinks boston could be hq2 and there's a whole thing going on with the health care -- what are you laughing about >> i don't know, i -- >> amazon and jpmorgan health care program >> good sports teams >> massachusetts always does well massachusetts has a great education system, has a really good workforce so is that where i'm going to be on monday? i don't know i do know, but you don't know. >> we'll find out on monday. >> you're going to find out on tuesday, but i'm going to be in the top state starting on monday we'll give our diabolical hints all day on monday. >> i got one more, how long is the flight you're in california right now how much travel time are you expecting to get to this place >> well, bear in mind, california is a big state, so i could be flying somewhere in california >> how do you know he's flying to the state, too? >> could be bicycling. >> that's true >> anyway -- >> i could be riding a horse >> i feel very bad for scott

having to endure this with us. thank you, scott, we look forward to hearing the number one state on tuesday >> i don't feel bad. he makes us endure this crazy wait to find out >> you guys are like give me an "n" does it start with an "n"? come on. >> i don't think it starts with an n it's been a solid year on wall street for ipos >> a lot that starts with "m"? >> geologic reporting the $35 billion raised by companies on u.s. exchange this is year is the fourth best year-to-date total on record. our next guest oversees the exchange that nabbed some of the biggest names to go public in 2018 joining us nasdaq stock exchange president nelson griggs. good to have you on set. >> great to be here. >> nice to talk to you about ipos and a great year, driven by tech and biotech what has it meant for nasdaq >> it's been great for us, 70% chose nasdaq tech about 35% of the total ipos

and biotech was almost 40% so the combination of the two drove the market >> the average ipo is up 22% on average. >> the average ipo about 22% but you separate out tech it's about 50% and biotech, the last few months has been strong, we've had a wealth of companies about to go public. >> how old are the companies typically and do they trade on the secondary market, a private market beforehand? >> the majority of the tech probably had market activity, probably ten years on average. biotech probably closer to three or four years. in both cases we expect that to continue in the second half. >> is it harder to convince companies to go public these days or easier >> i'd say companies if they're ready to go public they need capital and will look at that as a course to go but they'll wait on the technology side, until they're more mature and ready to go, ten years is pretty much the average. >> investors are demanding more

in terms of financials and track record, et cetera. >> just the size of the company to scale to get to be the billion-dollar company that does not happen overnight and companies want to make sure the business model is appropriate for going public and so they're waiting a bit longer >> from a timing perspective, there's always a question whether you want to buy on the day, wait two or three days. what does the math show you? >> this year it's definitely we've seen the average first day pop of 15%, pretty positive. most deals are pricing at the top in the range a dollar or so over i think the enthusiasm, the deals are being priced right >> are they holding though at 50%? >> the aftermarket >> there's a dip after a couple days and then it comes back. >> i would say right now, we're seeing the deals hold so that average 50% tech performance if you take 15%, 20% on day one, add another 30%, it may not be the next day but i think this year a lot of the stock charts are up and to the right. >> what are you seeing for the

pipeline >> real strong even with july losing two weeks we expect 20 deals on nasdaq alone. i think the third quarter. >> for the month >> for the month about 60 plus in the quarter >> wow >> then it gets murky as you think about q4 if the markets overall hold everything is working out with tech, china, et cetera, pretty active >> how is it going with uber >> i think a lot of those companies are starting to get some noise our worse thing to do is introduce ourselves in a meeting for a pitch. we work hard and talk to companies and working hard in all of them. >> thank you >> we get that question every time i'm on here >> uber, how are you do be with airbnb >> same thing, like in get in early. >> what state do you think it is >> i don't think vermont massachusetts though is interesting, because that activity you look at where the deals are coming from, it's off the charts great sports teams i'm from the boston area >> the weather is not great. >> this time of year is pretty nice >> it is but you don't have much

of a spring. we don't here. >> usually a surprise state, not one top of your mind >> it's called taxachussets. >> we'll be waited around with bated breath on tuesday. when we return, a rough ride for cryptos in the first half of the year bitcoin plunging more than 50% could cryptocurrency see relief in the second half of the year we'll debate that, when we come back

welcome back the u.s. economy added 177,000 new private sector jobs last month, according to the latest adp report the consensus was for 185,000. however, the prior month's number was revised higher by 11,000 to 189,000. we'll get a snapshot of the u.s. services economy later this morning. the institute for supply management will be out with its non-manufacturing index for june it's expected to drop by a half point to 58.3. barnes & noble looking to are a n -- for a new ceo. it fired demos paneros >> nobody knows why. >> one of those personal things. >> very shady. >> whenever you hear that, for

violating company policy but they didn't specify what it was but said it doesn't, you don't need to worry about cooking the books, so to speak, with barnes & noble. it will be run by a committee of current executives while the company searches for a replacement. i know you, you want to know whether it's like some tawdry -- >> i just want to know >> you want to know whether it's, you know -- >> a lot of ceos they've had >> is it a me too thing? >> i don't know. >> let's not speculate >> i'm not speculating i withdraw the question. >> okay, let's move on >> sustained bitcoin has plunged over 60% since its december 2017 highs but what does the rest of the year have in store seema mody joins us. >> tom lee sees it scoring 300% by the end of year but many wall

street veterans continue to sound the alarm. >> bitcoin is worthless artificial gold. >> second forecast expect more regulation, strong words from regulators may hurt sentiment with cryptocurrencies remaining a popular target for scam artists and hackers. expect the doj to intensify the crackdown. the sec is expected to pry more guidance on offerings, valerie szczepanik a new chief it more than doubled the amount raised last year will the sec classify all icos as securities, a move that could significantly slow down fund-raising third prediction wider adoption by wall street if the sec clearly communicates its rulings on cryptocurrencies and regulators show they're capable of taking out the bad actors, expect larger financial

institutions to enter the crypto world, not just goldman sachs unveiling crypto trading desk but asset managers like fidelity and bny melon becoming custodians that would add mobility and boost liquidity >> nolan barry joins us, director of research at coin desk, a blockchain and digital currency news site here is the question i've been trying to figure out all these people who jumped in to bitcoin in the fall of 2017 have been washed out >> oh yeah >> so the question is, who do you think is going to arrive on the scene -- if you were bullish about bitcoin who is supposed to arrive on the scene to get bullish and buy back in? do we think that that, those people are going to come back, the same people or you got to find a new crew? >> it's still going to be everybody in the world what happened in december was

just speculation going long on the asset. now it was shorted with all the future markets and the contracts that are out there, we saw a healthy change in the pricing. but the infrastructure was still not built. the whole infrastructure will be built from the failures and the mischief of people like facebook and google and these other huge companies that have come up and are pedaling all our own information. what last year might have been the slogan huddle with the misplaced dl, what everyone is talking about is biddle, building the infrastructure. lot of this is built off people using this stuff we haven't arrived at that point. it's all speculation that was great it was a really neat run much healthier that there was someone who could actually short it >> who do you think is using it now? >> really no one that's the problem we see a few markets going into place. the only real case besides the inherent qualities of bitcoin as a commodity, it's behaving like reserve currency for an

alternative financial system, not just one asset the other system that's out there is this one smart contract, this one use case being used which are the icos, the numbers you heard about earlier. it's disrupting this early stage liquidity and finance world where we see a blending of vc entering liquid markets and all kinds of stuff that didn'texis before what we have now is bitcoin behaving as a reserve currency in an alternative financial system which is only really affecting early stage fund-raising >> so before, maybe in the fall last year, the bull case invest in cryptocurrency, you're investing basically in the future of technology in blockchain can we separate those two? is that more tenable to believe that cryptocurrency is a store value but at the same time we're seeing all sorts of use case, all sorts of things being built on various platforms the development of the technology has not stopped, because bitcoin has gone down by 60%. can we separate those two now? can you say i'm a believer in

blockchain but not a believer in cryptocurren cryptocurrency >> they're with unin the same. the coins themselves are a way to enact this sort of cryptographic function >> you don't have to believe in bitcoin. >> you could believe in z cash and -- >> but the appreciation of those points you don't have to in th appreciation of those coins because that's separate from the development of the technology. >> sure. that's been there for a long time people have been able to separate them for a long time now but that doesn't erase the behavior of bitcoin in this system bitcoin is a unique element to this enitire ecosystem and none of it would be possible if it wasn't for what bitcoin did before that. >> thank you >> great to be here. >> totally clear to me >> you're going to go along? >> no. >> no! short? >> no. i want to know what one actually looks like you can't actually have one in your hand and put it in a safe, right? >> it is a cryptographic key >> what's it look like

>> a qr code, string of numbers. there's all kinds of new ways to imagine these. >> it's not shiny or anything. >> not that shiny, no. >> can't flip it >> have a president or anything? >> we can put all kinds of stuff on it. there's crypto kitties out there. >> put andrew on it. call it "the sork. >> the ross sork since both your names have to be pronounced. >> or mr. ross when we return, we are counting down to the opening bell on wall street. jim cramer's here. we'll do it live bill o'reilly. next a little bit of water, it really- it rocked our world. i had no idea the amount of damage that water could do. we called usaa. and they greeted me as they always do. sergeant baker, how are you? they were on it. it was unbelievable. having insurance is something everyone needs, but having usaa-

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let's get down to the new york stock exchange. jim cramer joins us now. did you compile a list of negative things to worry about, jim? that was your latest -- >> oh, absolutely. i mean, look i'm worried about tariffs. i'm worried about krcommodity pricing. i'm worried about italy -- no, actually, i kind of like things but i do know tariffs are tomorrow and i got to tell you, joe, i was on the conference calls that i missed while i was

away analysts keep saying it's got to end. it's horrible. but the companies won't roll over and play dead i don't know what to say joe? what is it with these people being optimistic what happened to these business people >> i don't know. that's a good point. >> they don't watch. they don't read. they just work that's the problem >> there's good worrying and bad worrying we like walls of worry, but then when it gets -- i don't know -- when it starts influencing your behavior, maybe it is not -- that's not the positive -- >> look, there is good worry we want to be skeptical. taum at all times because the market's had a big move. tech stocks while i was away, almost every one of them rolled over but businesses didn't we're not worried about europe, we're so worried about asia. i'm trying to process the worry every minute i'm trying it is not as easy as you think

>> did you say where you were on your tweets? i saw some of the pictures that you were in wine country somewhere. >> 35 miles southwest of florence >> i was very close to you did you go to monticino? is i was there last week >> we did chicatara. we did the five-town thing i was worried the whole time about tariffs. >> there's nothing available in tuscany. didn't you see that on "seinfeld" you found a place? how did you find a place you found a place. >> my wife bought one. >> do you think you could find a bad meal -- >> no. you really have to look for it i was worried about that i forgot to throw in i'm worried about the meal i was worried about the wine and meal situation >> so, yeah. all right. i bet you did that have to yeah, it is beautiful there. we were almost overlapping there. >> darn! we could have gone to the david!

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up 167 now on the dow. still sharply higher s&p indicated up 17 points or so nasdaq indicated up 49.70. we did see an employment report from adp it was a little bit light but the big number comes tomorrow. see what the president tweets. looking forward to that. becky will be back "squawk on the street" is next ♪ welcome back ♪ your dreams were your ticket out ♪ ♪ welcome back to that same old place ♪ >> good morning and welcome to "squawk on the street. i'm scott wapner with jim cramer live from the new york stock exchange futures up for this day in the markets. looks like a good one off the open, as well. dow opened higher by just about 170 points s&p would be up by 17. nasdaq by 50 so a good day shaping up on wall street take a look at what's taking place over in europeanar