♪ ♪ happy thursday welcome to "squawk alley." i am jon fortt at post 9 with morgan brennan, sara eisen carl has the morning off going to get to a lot. we begin with ali baba earnings, posting a miss on earnings, seeing shares rise after reporting a surge in revenue and average mobile monthly users josh lipton is in san francisco with more. >> the largest player in china reporting surging growth and estimates driven by core business steals climbing 61% to 89 billion. the company earned 8.04 a share. did miss estimates, they took a one time charge laid to comps,

tied to valuation. revenues from the core unit rose 61%. cloud computing business growing very fast in the quarter revenue nearly doubling. sales from a digital media and entertainment division climbed 46% to 6 billion juan. ali baba is forming a new unit, including food delivery service which received more than 3 billion in new investment, including commitments from softbank switching gears on the call, talked about another hot button topic, trade tensions with the u.s. take a listen. >> i want to spend a few minutes on current trade tensions. first, what's the impact to our business wel well, we are less reliant on

chinese exports. we believe chinese policy will support imports to satisfy rising demand of chinese consumers. this coming november, china will have the world's largest import exhibition in shanghai that will showcase products from around the world. if u.s. goods are too expensive due to tariffs, chinese consumers can shift to domestic producers or imports from other parts of the world in terms of international expansion, the world is a big place. >> it is moving higher this morning, still 13% below recent high many big chinese tech names are in bear market jd.com, down 35% from its recent high no surprise given selloffs some professional investors have been coming on cnbc, they see it as opportunity to carve out stakes in the companies, capitalize on

the chinese consumer back to you. >> josh, for years we used to talk about the counterfeit issues, quality control with alibaba. that doesn't seem to be the discussion now have they clamped down on that >> certainly looking at the numbers for the core business, morgan as we mention, that core business up more than 60% here back out, for example, food delivery service, that core unit was up solid 47% year over year, driven by active buyer growth, healthy spend per buyer. i did think it was interesting what he had to say about comments regarding trade tensions scully is known hot off the presses known to agree with joe tsai on the trade issue, play on the rise of domestic consumption,

relatively small reliance on u.s. consumers, and in terms of u.s. based imports, scully says they have been expanding the source of imports like the country itself europe, australia, asia, guys. >> something you read stood out to me which is i mean, alibaba seems like a tell on the chinese consumer larry kudlow, president's chief economic adviser says the chinese economy is terrible. is that what you're getting from the alibaba report >> no. certainly if you look at the pressure, there would be two concerns that the street would flag what they think investors are reacting to. one is a potential trade war, one what they see as a soft thing. however, strong numbers from joe tsai's company this morning, sara >> thank you, josh goldman, sachs is out with a new

report, vc funding in asia surpassed north america the second quarter in a row, alibaba and ten cent and softbank leading the way as every major private company in china has one of those five companies as an investor for his take on alibaba and other tech stocks, bring in the managing director with ljh investment advisers as well as our own mike santoli good morning to you both larry, you look at alibaba's earnings report, yes, they are investing, that might have concerned some people, but there's attention to the top line here and expanding portfolio of businesses they've got. are you impressed? >> i think i am, carl. but my impression is really not internally with alibaba but it's external, what's going on in beijing. i think the message you get, and

i have been watching china many years, especially as the gaming developed, nothing happens in china except if the party wants it to happen there's a rule in the united states, don't fight the fed. i think the rule in china investing is don't fight the party. right now the party is involved in very active economic stimulation because i think as larry kudlow says, the economy currently is really pretty stinky let's assume larry is well informed because he has good access to data if a pretty stinky economy can allow the top line to grow 61%, let's have more of it. and the problems below the line in alibaba reflect tremendous increase in valuation in ant financial, which is another mirror on the chinese economy. price of alibaba is the third

thing. relative to the internal growth of alibaba, the price in my opinion is very reasonable and i would just cite an alternative mechanism to buy it on the cheap with a discount in the neighborhood of 25%. so i think the market has it right here this is really a very, very good report, especially for those who have some understanding of the rules of the playing field in china. china is not kansas. you have to understand the rules. >> yes, and we all miss carl when he is off mike, when you look at alibaba's performance up against some of the other chinese internet names that have been performing poorly, are investors getting it wrong if they have been making assumptions about the impact on china's economy? any signs this is turning it around or are they factoring in other things. >> seems like stocks are driven by entirely other things

it is not really about sensitivity to exactly what the cadence of the chinese economy is if i look at the chart of alibaba, it is trading like emerging markets we don't like trade wars, dollar going up, trade tensions with china, even though these companies as have been described don't export anything with a tariff, it is not a direct result it is a fund flow issue. you look to larry's point, alibaba trades at the same forward pe as alphabet with a lot faster top line and bottom line growth, if you get comfortable with their financial numbers. lot of people have never been able to. it is now a half trillion dollar company, say it is a black box, they make acquisitions, you don't know what's going on if you get comfortable with it, you say it is inexpensive an pressured by macro stuff. >> to expand that further, we have seen divergence between

faang stocks and baba, and back stocks in china. is now the time to buy those stocks above and beyond baba >> i think they're all different. baba has in my opinion a better business model than jd jd takes ownership of the goods, that lowers the return on invested capital jd in my opinion was like amazon's e-commerce business only it didn't have the amazon cloud. it's not in my opinion a particularly good business by due is facing perhaps competition from google which has decided maybe it can work with the minersin beijing. that's not good for their multiple they have a big external risk. ten cent, they have been restricting play on some games,

depriving them of revenue. all these companies are kir different. the computers that put them all together are giving an opportunity to humans that are smart enough to understand the differences in the companies i think the intelligent investor here will look at opportunity, and i think the opportunity is in alibaba i don't necessarily think it is in the other chinese companies at this point. but that's because of micro economics of those companies. >> so back to macro a second, mike, the other way these chinese internet names trade is with u.s. internet names and growth stock trade which was hot through the longest ever bull market the jury is out whether there's an opportunity for value and different type of leadership position that i assume would hit companies like alibaba growing revenues 60%. >> if there was global flight from mega cap technology growth, they would be hit again. right now, these chinese counter

parts to our faang have vastly underperformed, they're not getting the benefit of the same general long term secular growth premium we're getting here i feel as if you're looking for these to come back together and trade as one globally, if trade tensions cool, you get a deal, capitulation in emerging markets in general and bounce, chinese internet stocks even if they shouldn't trade as a block, probably will, and probably would snap back more. >> i want to ask, something you said about jd.com. interesting parallel between jd, versus alibaba, amazon versus i would say ebay back in the day what's your argument for why jd isn't going to be like amazon ten years from now when it develops the logistics network in china it is trying to build out? do you think e-commerce globally is too mature for that to be a

reasonable strategy at this point? >> i just don't see how they could build a business on the scale of amazon web services you take amazon, outside of amazon web services and whatever you think of jeff bezos and his management skill, numerically it is not an attractive business. has low margins, very low free cash flow generation i don't think there's room in the aws/cloud industry for jd to ever make enough money to justify the fact that owning the goods and doing the e-commerce is just not as good a model as joe tsai and jack ma have in alibaba. alibaba is a very, very good business now, you have to have a lot of faith. a few years ago a number of american investors spent weeks

writing reports how bad their accounting was and the stock has more than doubled since the ipo, so they have been proven wrong i believe go back to what i said originally if the chinese government wants something to happen, the odds are that it is going to happen because the chinese economy over the last 20, 30 years has grown very rapidly even if it is slowing, the numbers are so staggering. you look at this, they added 15 million users sequentially in the quarter. these are very, very large numbers. the market cap is very large the valuation is low and the opportunity is there as these cities, tier two and three cities continue to develop i think it can be skeptical. but it is not warranted.

>> investors who were watching, for example, walmart's investment in flip cart should take note of your point. thanks for being with us baba shares turned lower >> tech is outperforming in the market when we come back, more data issues for facebook. why apple asked the social network to remove its data security app from the app store. henry blodget and kevin d n delaney discuss what's nexwit th facebook what do you do with the trust issues dow down 37. this wi-fi is fast.

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in many cultures, young men would stay with their families until their 40's. welcome back to "squawk alley. apple asking facebook to remove the data security app after apple found it was in violation of the data collection policies. facebook continuing investigation into other apps' data use as well, suspending over 400 in the process, including a quiz app called my personality today. the social network is continuing to struggle with issues over data security, user trust. joining us at post 9 to discuss, henry blodget, ceo, editor in chief of "business insider" and

kevin delaney. thanks for joining us. it has been another busy week for facebook henry, we started the week with more fears around information manipulation had hundreds of pages tied to iran and russia pulled down, now we have more concerns around data, data usage, how it has been shared via facebook >> yes and the answer is facebook and lots of other silicon valley companies have to keep raising the bar for what's okay on the platform they don't want to do it they're libertarians at their core, want to build a platform, not have to take any responsibility for how it is used and what people say, but it is very clear they built the most powerful media and communications platforms in history, they need to take more responsibility for that. >> you look like you have something you want to say. >> one question i have we both covered the internet for years and years. one of the striking things is that consumers might say they're

concerned about data privacy, rarely alter usage patterns based on that. the question i would have based on what henry just said, will people's habits change if you look at facebook's most recent earnings, their monthly active users continue to climb you don't like facebook, you can go use instagram or what's app which facebook also owns and has similar data policies for. i'm not sure i'm convinced this will change things. >> you know who cares? tim cook cares, he seems to care quite a bit. interesting this gutsy move from facebook saying this app isn't facebook, it is onavo. we are watching everything you download on your phone, getting smarter because of that. henry, what do you think this reveals about the dynamic between apple and others versus android platform and what developers are going to be able to get away with. >> one, talk fake news

apple has gotten it right. you look at apple news they have a very wide group of contributors to apple news, but it is apple editors saying you are a news organization of appropriate diligence, fact based. we want you in our news app. we are making a choice, are taking responsibility for that c other platforms say who are we to judge there's now controversy that there's censorship of conservative views, companies are koicoiling in horror at tha. we need to draw a distinction between taking stuff not fact based, pure make stuff up that happens to be conservative views and banning that from platforms, saying no, here are journalism companies that are fact based and diligent but have a conservative point of view they have to make these decisions. i would say apple has gotten this right they set a high bar. >> i want to hear your thoughts

on this, but it feels like it is a broader, bigger animal over at facebook when it comes to misinformation, and that they're sort of trying to do what henry is talking about it is a personality app, do they have any idea what it is >> i don't think they still have it part of it, you look at fake news specifically, they don't have a developed, don't have the same conviction that henry has and that apple has, that there's such a thing as a credible news organization, whether on the right or left. facebook if you talk to mark zuckerberg, he sees every news organization as existing somewhere on a political spectrum from right to left and is comfortable putting organizations like "new york times" and other organizations that are promoting hate speech on the same spectrum, letting users make the choice. henry makes a point apple decided there are credible news organizations across the spectrum, we're going to provide a place for them

facebook has not gone that far i think that's a problem. >> they're moving in that direction to their credit, i just think they have to move farther. >> begs the question, given the flood gates opening on facebook with all of the disclosures and news coming out on a daily basis, is this facebook taking the right action to being more aggressive, including versus some of its competitors and rivals that's the reason we're getting all this bad news. or is it that facebook has been prone to more of it? >> stepping back, what you find in the history of silicon valley and disruption is companies that succeed are super aggressive in early years. they do what they have to do to get their products out to compete. microsoft went through this. eventually they reach a stage when successful that they're so powerful that a new issue emerges, they're too powerful. they have to grow up, think about society and value of goodness that they're bringing to the world, they have to change their behavior. that's what happened with

microsoft in the 1990s the doj attack on microsoft that didn't slow the company's profitability but did change the culture. that's what's happening with facebook. >> that's what i was trying to get to, underlying it, feels like this is a story about platform power we have been watching to see how the government will check that seems like these powers are checking each other. companies are complaining about the tools they have to pay to be in apple's app store, google's app store. now we have apple checking facebook's privacy decisions to what extent is this an important impact on consumers and do we have to throw our weight behind companies rather than governments to regulate some of these? >> i think it is an interesting observation. we have seen the governments are moving slowly, don't always have the grasp of technology behind the scenes what you're seeing with apple is they're a luxury consumer goods company. they've made beautiful phones,

computers, watches, air pods part of the luxury here is their business model, they pay a lot for this stuff, and don't throw advertising at you and you get privacy as part of the luxury proposition. what we have seen this week is you have a business model conflict between apple and facebook, and apple looks pretty good coming out of this, that part of the luxury proposition is they're not going to abuse you in the way they accuse facebook of abusing you. >> i want to go to a point, users don't seem to be effected or worried about data privacy. i realize that the number is still groove for facebook, but rate of growth has slowed down wa we've seen numbers drop for snap and twitter as well. you don't think folks are jumping ship, are not down with this >> i don't actually. i think that like i said, i think they might be dumping to what's app or instagram on the

margins, but i don't think it is a mass movement. people choose convenience. at the beginning of amazon, people were worried about amazon watching what books they were reading or g mail was spying on e-mail that hasn't stood in the way of the success of either of those companies or products. i don't know, just the last 20 years of internet usage suggests that consumers given a convenient choice won't shift away from service over this sort of thing, particularly if facebook is able to convince them it is more responsible. >> the real reason it is slowing down, saturated the market everybody in the u.s., first world, 2 billion people, have to get other folks online before they can grow. and the point on data, agreed. but i feel people when they feel they have been manipulated by bad actors, that's something you say wait a minute, i have to approach this from a distance a little bit >> good discussion thanks for joining us.

as we head to break, let's check on where we stand in the markets. all of the major indexes are down the dow down 90 points s & p off just a bit nasdaq as well next, have we reached peak fortnite what data shows aboutht e videogame phenomenon when we return stay with us to buy or sell? time with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today.

♪ ♪ welcome back to "squawk alley. have we reached a peak in the videogame phenomenon fortnite? that's what data is suggesting julia boorstin has more. >> the explosive revenue growth slowed dramatically. super data research says that data suggests the game's peak may be behind us fortnite's revenue grew 2% from june to july

that's down from over 32% revenue growth between march and april, down from 71% growth between february and march that continually declining growth, despite them releasing another battle path through july, a way to access challenges and rewards. the other bad news for fortnite, according to twitch metrics, fortnite lost the top spot of most watched games on twitch, based on data in august, fortnite which dominated the first half of the year has fallen to number two most watched game the question is whether there's fortnite fatigue or the market for this game is saturated, weather players are moving to other games such as pub g. we have to see if this is a bad sign for the game publisher's decision to embrace the multi player mode that fortnite popularized. on the heels of fortnite

success, ahave multi player mode similar to battle royale games rated for teens and everyone grew 22% year to date, according to npd research. that's attributed in part to fortnite bringing more kids into gaming guys >> julia, i think this continues on a theme we were just talking about, platform strength my question is do epic and fortnite now have enough power, strong enough brand to get around toll charges for apple's app store and google's, even if they're not the most popular, if they have an audience that loves them enough and is willing to pay, that could be powerful on the business side. >> i guess fortnite is not just relying on mobile platforms. i don't know if it has that

power. now peak fortnite is over. it is interesting when you look at game makers, how they show revenue with the app store >> interesting story especially for those mothers and boys out there like jon. >> and fathers let's get to don chu for the european close >> european markets finished modestly lower and higher as you can see across the board, despite manufacturing data from germany and france trading is relatively quiet as you see here macro economic story lines on currency markets are front and center for investors in europe today. first of off, the central bank released minutes from the last policy meeting comments didn't surprise investors. policy makers say the slowdown in the first quarter was temporary, emphasize solid growth in the eurozone lies ahead. warned the continued protectionism and trade tensions could lower confidence down the

line. brexit secretary is laying out what he called practical, proportion at guidance in the event the uk were to leave the european union without a deal. under the terms, britains in the eu could lose access to bank accounts while businesses on the continent could be cut off from investment banks in london saying all british citizens produce higher credit card charges in the eu when traveling abroad or shopping online. and finally, a big corporate story in europe. shares of ryan air jump more than 6% on word it reached agreement with the union representing irish pilots, the biggest low cost carrier endured the worst one day strike after walkout by pilots disrupted plans for 55,000 passengers. protests this summer resulted in hundreds of flight cancellations, jon back to you guys >> thank you, dom. let's go to sue herera for a news update. sue? >> good morning, jon, good morning, everybody here is what's happening at this hour the nation's largest grocery

chain is getting rid of plastic bags kroger says they will phase them out by 2025. the company currently orders about 6 billion bags a year. fiat chrysler is recalling minivans and suvs to fix brakes that may be too spongy, which makes the vehicle take longer to stop. ohio state suspended urban meyer without pay for the first three games of the season, and he will be docked six weeks of pay in response to his mishandling of domestic abuse allegations against a former assistant coach. athletic director gene smith will also serve unpaid suspension the board said neither man condoned or covered up abuse but failed to take sufficient management action. and george clooney tops forbes' list of the highest paid actors, but it wasn't a blockbuster movie franchise that put him over the top, it was sale of his tequila company that

helped push his earnings to $239 million last year. dwayne the rock johnson is the runner-up, bringing home $124 million. you're up to date. guys, cas amigos is the name of the tequila, not that i have had any. they sold the company, and got $700 million in cash up front and $300 million more if the company hits sales targets in the next decade. mr. clooney said we just like tequila. we started a company, we like tequila. apparently they do too >> exactly i'm sad, you don't have a bottle animal crackers we had box of the cpizza. you have to make up for this tomorrow >> i will bring it tomorrow. liquor stores weren't open that

early. can you imagine? buying tequila >> sue herera, thanks. coming up, u.s. and china continue trade talks in washington as both countries slap new tariffs on the other. we're going to discuss that. and look at the dow right now. it is down more than 100 points. stocks slipping after relatively quiet start to the day back after this. well, it's earnings season once again. >>yeah. lot of tech companies are reporting today. and, how's it looking? >>i don't know. there's so many opinions out there, it's hard to make sense of it all. well, victor, do you have something for him? >>check this out. td ameritrade aggregates thousands of earnings estimates into a single data point. that way you can keep your eyes on the big picture. >>huh. feel better? >>much better. yeah, me too. wow, you really did a number on this thing. >>sorry about that. that's alright. i got a box of 'em. thousands of opinions. one estimate. the earnings tool from td ameritrade.

♪ ♪ trade talks between the u.s. and chinese officials continue this morning in washington the goal, to negotiate an end to the trade war that's escalated since the beginning of the year. analysts saying a compromise will not come easy for more, bring in ben steele, and author of "the marshall plan", and also bruce andrews, former u.s. secretary of commerce good to see you both ben, today marks an escalation, more tariffs back and forth between the u.s. and china how likely is the next leg, $200 billion of imports to be taxed on china to go through >> up to 50 billion on both sides. the administration is going out of their way to dampen expectations two reasons. first, the chinese come up with major concessions, they want

credit from you and your colleagues, want to extract maximum media benefit out of this more importantly, there are hard liners within the president's economics team that want the tariffs in place for years as a means of repatriating global supply and manufacturing. >> you don't see a deal in sight? >> i don't see it anytime before fall at the earliest the chinese are very much looking forward to midterms. they think it could put pressure on the president i don't think the president is moving anytime soon. >> bruce, will it put pressure on the president into the midterms so far it doesn't look like it is having a major effect or any real effect on the economy and consumer prices. you can spot it in some specific cases, but is this a real issue for the president? >> look, i do think it will be a real issue, i think the cumulative impact of tariffs is

going to impact farmers, going to impact businesses, and ultimately will hurt competitiveness of a number of american companies that operate in global markets and compete with foreign companies in their same fields. with that said i agree with ben, i think the president is very committed to this and is willing to endure some degree of political pain the question is over the course of time, we see a real negative impact on american companies and american farmers, is the white house willing to stick with this, particularly when foreign competitors will benefit at the spen expense of americans. >> i want to go back to a point you made, ben, it is important in terms of how the administration is potentially thinking about this, the idea that there's a split within the administration how they're thinking about tariffs on one side, maximum pressure for a deal as quick as possible. the other side, keeping tariffs in place to incentivize more

businesses to do more stuff here in the u.s when you think of it from either of those perspectives, we have a lot of debates on air about why would you do this when there are other options you can take sounds to me like you're talking about an administration that sees tariffs either way as a win-win. >> that's right. if you look at the left of the administration, mnuchin, kudlow, they're willing to use trade tariffs as a stick to beat china but they want to get a deal done as quickly as possible mnuchin was willing to do it a few months ago one tool the administration amazingly hasn't used is wto they disparaged the wto, but they have allies in europe, latin america, asia, who would join them in trade action against china. there are nuclear options, so-called article 23, which encompasses a broad range of chinese off line actions against

foreign companies. but instead they're talking about potentially pulling out. i think it is a mistake. >> bruce, who can hold their breath longer in this situation. we see some signs of pressure on china. we see very few signs of pressure over here is there any sense, any detail you've seen the past few weeks indicating one side or the other is likely to flinch? >> i think both sides are actually underestimating the ability of the other side to endure pain. i think that the administration looks at the weakening of the chinese economy but doesn't recognize the fact that he can keep his folks unified but also that china has a number of tools at its disposal to deal with pain caused by the united states with that said, i think the chinese underestimated how frustrated and serious not only the united states but the entire global community is with their

practices that they need to change, and that they're at least thus far, the people who are most impacted by trump tariffs are core trump supporters i think over the course of time they're going to get frustrated as they see their business go to foreign competitors and there will be economic blow back but i think both sides are misreading the willingness of their opponent to really stick with this and endure a significant amount of political pain >> one other factor, ben, that i think mosey co mosey -- most ec, the strength of the consumer it is the best consumer environment he has seen. does that make the u.s. economy more able to absorb tariffs if they hit imported consumer everyday products like furniture and baseball gloves which are included. >> absolutely. the president is very aware of

this he pointed out that the stock market has been extremely buoyant, despite talk of escalating trade wars. he says we're, quote, unquote, playing with the bank's money. this is how a deal maker who has relied on taking leverage bets in his business practice sees trade policy broadly >> we'll leave it there, guys. thank you. coming up, why tariffs are serving up a win for restaurants. later, tune in to "closing bell" when dallas fed president rortbe kaplan joins them lot more to come on "squawk alley.

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is apple's run about to get sweeter, is the stock due for a cool down. the debate is on. and new note from goldman, sachs may provide you with a great buying opportunity and a part of the market more stock watchers say is the best place to be all that and more. halftime report, top of the hour morgan, over to you. >> looking forward to it. later, headlines are crossing for the president's meeting on foreign investment. president trump says u.s. net worth up 10 trillion since the election, touting a strong stock market, saying not enough focus is placed on china we'll take you there when we get

the video in a short while first, when we return, let's send it to aditi roy >> these corn tortillas and corn chips may be cheaper because of the tradwae r. how restaurants may benefit from trade tariffs coming up.

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you'll only pay $4.95. this wi-fi is fast. i know! i know! i know! i know! when did brian move back in? brian's back? he doesn't get my room. he's only going to be here for like a week. like a month, tops. oh boy. wi-fi fast enough for the whole family is simple, easy, awesome. in many cultures, young men would stay with their families until their 40's. continuing to watch stocks, we've seen stock lose a bit of steam here the dow down over 100 points a

few moments ago. down 92 points goldman sachs and caterpillar off the stocks right now we've waiting for the president. yields are lower that means pressure on financials, energy and materials, as commodities as weaker again we'll go to the defensive on today's trade. >> nasdaq lower as well. meanwhile, staying with trade and tariffs could restaurants be the surprise winner we've got aditi with the answer. >> hi there. the ceo of this local mexican food chain says he's benefitting from the trade war items like these tortillas with tacos and burritos and the corn tortilla chips that come free with every order are now cheaper. here's why, tariffs coming in from china to mexico are causing supplies of ports of potatoes

and corn to pile up.ceo of this company says his total costs are going down 1% to 2% because of the tariffs. >> we use that for reinvesting in the business. for me, the reinvestment really is in r & d, we do a lot of market research. we try to change up our products on a monthly basis we spend that on r & d >> how much are prices coming down, the data analytics for restaurants found the top six for decreases in tariffs the firm worked with $250 million worth and up to 3,000 restaurants. they predict over the year restaurants will save $19 million on pork, $9 million on potatoes, $4 million in corn and $2 million in cheese farmers are also hurting they're seeing a decrease in prices and that's lowering their profits. as a result of that, experts say

they may end up lowering production on many of those items which would cause those prices to go back up back to you. >> aditi, thank you. just want to check on the markets again, dow down 96 we're waiting the president, he's getting together with some of his key members administration like john kelly, steven mnuchin, larry kudlow is going throb as well. some of the members of congress, senator marco rubio, senator tom cotton and the topic of discussion is foreign invest review. this is the president's key change he made to the group within treasury. it's going to take a stronger approach to approving foreign investments and deals and joint ventures now it's something that secretary a mnuchin shared with us it looks to be taking effect we'll wait to hear from the

president when we get it >> and news out of alibaba, revenues are strong. stocks down more than 1% at points but now it's down by .75%. gd down nearly 3%. so there is some pressure on chinese stocks in this environment as we're talking about the trade war and investment >> and that pressure, as we do get these headlines from president tread that the u.s.' worth is up $10 trillion since election and president trump says not enough attention has been placed on china and that economy is down lately. comments we've heard from him and other advisers in recent days >> and that is the administration's posture it's that we've got the upper hand our market and economy look better than yours. whether it's true or not, certainly from a market uerspective, that appears to be

tr we'll bring you the president live as soon as we get that tape in more "squawk alley" after a break.

the president has been holding a round table discussion with senior members of the administration, also members of congress republican members of congress

to talk about foreign investment this comes after the administration had sought to expand the powers of sip pie si, it's one of the prongs toward the trade policy with china toward, frankly, blocking or having a little -- or putting a little more emphasis on the national security side on those chinese deals and that money that comes into this country >> yeah. it's not just the president. also congress has taken a much tougher stance all of those qualifications came out through the defense bill signed into law in the last couple of weeks. much tougher stance towards china that bill as well of course, we get the comments from the president around the roundtable signaling china >> and saying we tricked up trillion in worth that echoed something that he said in an

interview in the past days that china has gone $15 trillion in worth. not clear what he's calculating there or what the implications are. >> unclear that we're talking about the market or some sort of economic value of gdp. we'll wait for him to elaborate on that point. >> that's if for "squawk alley." let's get to "the halftime report" at headquarters. and welcome to "the halftime report." i'm melissa lee in today for scott wapner we start with apple's big run, 10.5%. could can get sweeter, or sliced here to debate, the cia of sand-held global advisers. we're awaiting the president to speak, about the risk of foreign investment we will go straigh