♪ live from new york where business never sleeps, this is "squawk box. good morning welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen our guest host is steve grasso last trading day of august what should we anticipate? >> the markets have been trending higher. trend is your friend how long have you heard that >> long time >> large cap tech seems to be in vogue again. don't get clouded by the noise stay straight on your path >> stay straight, keep the path. let's look at the futures. yesterday we did see a pullback. for the month of august you're talking about big gains.

we could be looking at the biggest gains for the nasdaq in about 18 years the biggest gain for an august percentage gain. also looking at the dow and s&p to be on track for the best august dow futures down by 32 points this morning s&p by 4 nasdaq down by 9 let's look at asia in japan, the nikkei closed flat it was down but only by 4 points the hang seng was off by a percentage point the shanghai was down by almost a half percent in europe, red arrows there. the dax down by 1% so is the cac in france. look at treasury yields. right now the ten-year -- even the 30-year is below 3%. 2.995. ten-year at 2.848.

today's big headlines concerns trade eamon javers joins us live from washington we know what's coming later today. we're still at work for now. let's stay on the straight and narrow >> wait for it what time does that happen >> i have my sail boat tie on getting ready for the weekend. >> all right there's still work to be done. >> we're waiting for an announcement here on whether or not they got a deal with canada to bring canada into that bilateral deal with the united states and mexico that was announced earlier this week. will the canadians join? won't they join? that's been the suspense through the week they have not been leaking or negotiating in public, so we don't have a good sense of what the specifics are. speaking last night in indiana president trump gave a bit of a last-minute threat to the canadians of what might happen if they don't come on board.

here's what he said. >> we'll see what happens. if it doesn't happen, we'll put tariffs on the cars coming in from canada, that will be even better but i think it's going to happen we've really developed a good relationship look, we love canada they have to treat us fairly they haven't treated us fairly >> so the president there saying we love canada, they have to treat us fairly, but if they don't come on board, new tariffs on canadian autos will be in the picture. that gives everybody more incentive to get this deal done. all the noise has been favorable but no specifics announceme announcement the president giving an interview yesterday to bloomberg. he touched a lot of different topics you can see what he talked about. he said the deal with canada may come friday or within a period of time. no specific time frame there from the president on that one on europe he says the european

offer for no auto tariffs is not good enough. he said the eu is almost as bad as china on trade. so the president making a number of comments and saying that he'll withdraw from the world trade organization if it doesn't shape up and he says china is not playing on a level playing field in terms of its currency he also commented on google and facebook the president has been critical all week he said many think there's an antitrust issue with google, facebook and amazon but declined to say if google, amazon and facebook should be broken up that's classic trumpian phraseology when he says many thing there's an antitrust issue. he doesn't say he himself thinks there is we'll see if the president wants to take further action on that >> you have to admit, eamon, i don't know how it all works out, but we've been around a long

time watching how politicians talk, diplomacy, can you imagine the poor europeans they read this stuff what he says it and it's petulant but it's so -- it's just so blunt sometimes i think it's deserved. everyone else is walking around with kid gloves. he says they're almost as bad as china. they have not seen anything like this before. >> no, they haven't. i was in brussels over the summer with the president, he was there for the nato summit. the european action, they were sort of bracing for impact when he came into town. a lot of the strategy now at the international gatherings is to p pre-bake everything before the president gets there have the european negotiators,

the american negotiators sign everything, deliver everything, and then he can't mess it up that's how they handle this diplomatically >> maybe it's effective. >> i'm not saying it's not effective. that's the thing, they have never seen anything like this. a couple of cases we've seen they finally said okay, whatever >> that's the upside the down side is you don't know about the unintended consequences down the road >> he's a business guy who did a bunch of deals if someone came at him with a deal that was not in the interest or taking advantage of you in a business, he's like i'll walk away from this >> lyndon johnson, when he was in the senate, when he then went to the presidency, he used to put his arms around guys and kick them in the shins with cowboy boots to say you'll do this deal.

this is a more public front, but we've seen tough negotiators in the past >> this week could ab clabe a cc example. there was a nafta renegotiation going on the president said i'll cut a side deal with mexico. that's it. canada, if you want to get in, get in otherwise we're moving on without you. that message seems to have resonated in canada. the canadians have come in hard to negotiate this week >> to your earlier point, just the idea that the negotiators try to set the table beforehand, you made the point yesterday that there were a lot of sweeteners that they put into the deal with mexico, sweeteners for canada to try to get them back to the table. so behind the scenes people are working to try to make concessions. >> the president's rhetoric operates on a different plane than the staff and diplomats operate on

you have to make sense of it >> eamon is like -- it's like an irish name >> it is >> are you a sailor? i think we got a shot of that tie. do you know how to -- ♪ >> i've been on a sailboat before let's put it that way. ♪ >> so you are not like -- >> my sailing is limited to listening to jimmy buffet songs on the weekend >> christopher cross, right on cue. >> you remember danny noonan, when he was going on smales boat dressing up with the ascot >> no. >> "caddyshack"? >> yeah. yeah i need one of those captain hats >> yeah. i can see you. you have that change of clothes right in -- >> i have the captain's has the. i'm ready to go. >> okay, eamon >> can i ask one more question >> about my tie? >> no back to nafta.

if the president last night is still talking tough with canada, it sounded like they're friends, but if they don't do that, that's fine, we'll slap tariffs on their cars, if he's still talking tough that makes me think there's not a done deal or there wasn't last night when this was taking place. >> there's been a lot of shots across the bow this week, that seems like another one last night. a cattle prod to the negotiators. when you talk to the negotiators who have been coming in and out of the u.s. trade representatives office on 17th street, they seem to say that things are going well. they're talking about progress, good commitments, good comments. all the sort of mood music around this is good. the process seems to be encouraging to everyone involved we'll see. >> nicely done that's a nautical phrase, shot across the bow >> i didn't even notice that >> that's the theme. ♪ >> there you go.

>> you brought this on yourself. no one would have noticed that tie. >> that's right. i should never say anything on television again >> not on this show. >> eamon, thank you. >> have a good weekend >> you, too. let's tell you about some of the top corporate stories. coca-cola is buying costa for 5$5.1 billion costa which was founded in london in 1971, is a rival to starbucks in the uk. coke is trying to get away from fizzy drinks and get into different options. james quincey says hot beverages is one of the few segments of the total landscape where coca-cola doesn't have a global brand. costa gives us access to this market pepsi last week made that deal with soda stream for 3$3.2

billion. trying to get away from sweet drinks, give alternatives. >> what's interesting is you see the beer companies going cannabis, you see the soda companies trying to get away from the fizz. you go back and forth. fizz, vitawater, seltzer >> they are all non-sweetened and trying to chase consumers changing tastes. buffett spoke about how brands today are strong, but you can't count on consumers to stand by brands like they used to >> i have four kids, my kids love soda. i grew up soda, then no fizz now the kids like soda again it's coming full circle. >> what do you mean no fizz? not even poland springs? >> seltzer >> now i'll do it. but -- what were you doing >> my mid life

30 years old >> mid crisis. >> just water. >> bourbon is not fizzy? >> it's good for you >> i do like bourbon pounding scotch. >> i had a bourbon on the way here >> good. good for you >> it's friday >> among the other stocks to watch -- before we talk to simien, i want to give you this to read. the market was down yesterday. so obviously the gains for 2018 are over is it only august 31st >> yeah. >> it's the best august for the nasdaq in 18 years reuters says the gains are over. >> how the hell -- you know what they're talking to 55 -- no offense, but 55 strategists,

many of the ones who are the same guys on this show you know how they usually do no offense how do they possibly know -- they have a year-end target below where the s&p closed isn't that a good sign always always the consensus is always -- who knows what will happen maybe we go down maybe we don't go up maybe it does close flat i don't know how they could possibly know that >> what is bearish is that everyone always says that everyone is bullish. more people that i talk to and to your point are a little more bearish than you would think as of late. this is always the most hated rally. this feels like the most hated rally i've seen. >> all right lululemon is one of the stocks we're watching today they reported earnings profit nearly doubled at the company, that was above expectations, ben frefiting from strong growth online same-store sales in asia grew.

i don't know whether they just discovered these stretch ji b e business pants >> you still wear those every day? >> i have four pair. >> and he wears one pair every day. >> shares -- that's not the only thing i wear >> too much. >> there's an schwarzenegger movie called commando, wasn't there? >> shares of ulta beauty coming under pressure they reported better than expected second quarter earnings -- it's the summer, it's the dog days of august. >> it's a long holiday weekend so who's watching. >> stay tuned.

anything is possible same-store sales grew i don't even know which company i'm talking about. ulta did they just miss spepell that? >> short for ultimate. >> i think you made that up. let's get back to the broader markets, joining us is simien highland, and our guest host, steve grasso we will talk about this. simien, what do you think, is this the most hated rally? >> i don't see where the bad news is coming from. this week, we have the highest consumer confidence number in 18 years. incredibly strong earnings growth >> what about the idea of the cross currents, things going

wrong with trade it looks like we could be on the cusp of a nafta deal, but it's not done yet that may be one headline hanging out there that people are still concerned about. >> the manifestation of emerging is to be expected. that's because of quantitative tightening in the first half of 2017 we had a trillion dollars of bonds bought by central banks. we only had 100 million the first half of 2018 we know that's going to put pain in emerging markets. >> when you look at the marketplace, when i go back five years, a year, three years, it's always the same top performers you always get tech, consumer discretionary. you get certain players. do you think that's going to be the same going forward >> the difference this time is there's a little more stability on that side for two reasons number one, there's real earnings on the tech side. earnings growth in technology has eclipsed the s&p 500

that's different than the last time we had a tech rally the other thing is the tax change the corporate tax cut is most meaningful for companies that have pricing power you don't have pricing tax cuts consumer that said, they're a little expensive. not as expensive as they look on a classic price to book basis, but still a little expensive >> let me throw one more at you. you do have all these headline risks for the potential for regulatory interference or anything that comes from a tweet these days if you're google, if you're twitter, if you're amazon, we talked about how they've been in the cross hairs of the president. some of those companies are coming next week before congress to sit down where they really dig in you have the right and the left coming after some of these companies, specifically google, twitter, facebook. they're concerned about interference from the elections,

concerned about not all voices being heard. is there a chance this would be the one bipartisan issue you would see in washington? >> i don't think you need more reasons to lighten up on technology if that's a catalyst for rebalancing portfolios it's been a strong run it's a wildcard. it could happen. but valuation in and of itself is reason enough from my perspective to lighten up on technology >> steve, what do you think about some of those names? >> when you look at tech growing 25%. i get you. there's a lot of depth to what you call tech. but tech is a different tech than we saw during the last cycle. amazon is tech amazon is retail amazon is cloud. that's a valuation people can't get their head around. then you go to an alibaba, which is the chinese amazon, you get your head around valuation, but you have a problem with trade. you have to stay sort of diversified among the tech space, but at 25% growth rate

you have to be there i don't think you can rotate out of it. >> i think about that with apple. if you get caught in a massive trade war with china extends over a long period of time, apple could pop up as a name that they punish it's already come up >> you have two people buying apple, warren buffett and apple themselves apple can buy more apple than anyone else. >> there are always buyers on dips it seems like we're always talking about apple, the trillion dollar mark, we've forgotten about that now there's $240 price targets on apple >> as soon as you mentioned alibaba, the tech rotation is a global one the big acquisition by coke in the uk today reminded me as another example, uk valuations they're on par with continental europe which is rare. they're usually price d at a

prooem peop premium. as you look at the impact of technology globally, it has important regional implications. >> simien, you think this is a good purchase for coca-cola? >> i'm not a huge expert on the beverage market, but it is a bit of endorsement of uk looking past brexit. >> thank you for joining us. >> appreciate your time. coming up, chances are you know at least someone who plays hq trivia. >> the entire "squawk" crew. >> they do >> yeah. i was thinking i don't know if i do >> now the popular game is turning to sports. that story is next as we head to break, a look at biggest premarket winners and losers in the dow.

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♪ a major match is set for flushing meadows tonight serena and venus williams face off at the u.s. open serena holds a 17-12 lead in they're all-time series including 8 of the last 10 as you recall, serena is younger. venus took the entire world by storm. then serena eventually -- i don't know whether you say eclipsed, both careers have been great. >> she's been dominant >> i think i'll be close to where serena's husband sits. >> alex. >> alex. do you cheer wildly? i don't know what to do. do you cheer wildly? >> follow his lead whatever he does >> i always wonder what the

parents do >> yeah, serena. you're killing it. he looks over at the mom i don't know i'll try to figure it out. brad gilbert will be on. >> you cheer for both sides. you clap every time someone makes a good point >> i told my son this all the time unforced errors, do not cheer loudly for the other person. >> where did he learn that from? from you at home >> i do. okay i do i do i do cheer wildly for that >> all right speaking of athletics, the wildly popular hq trivia game has branched off into sports eric chemi has that story. this is a hot topic around the office >> at 3:00 in the office i hear the "squawk box" production team, they stop working and they all start cheering hq trivia sports is the vert breakout vertical for the hq

trivia app which launched last august "time" magazine named hq trivia the app of the leeriayear last r >> we saw an opportunity to expand into sports for one reason, it's that sports fans are obsessed. they're deeply passionate about sports >> the founder years ago founded vine, the short video service which was later acquired by twitter. think of hq sports as the modern day game show, it just works on the internet instead of televisio television >> we're able to offer something new to advertisers it's live event sponsorship. our players are not passively engaging with hq trivia and at random parts throughout the day. they're tuned in at a certain time you can't dvr it

it's incredibly valuable for advertisers. >> the advertisers like the interactivity because audiences have to pay more attention than just watching a video. so they're more likely to listen to the in-game ads there are countless online competitors, and at some point it may come down to which game gives out the more prize money, so this may be a growing genre it's like "jeopardy" but it's on the phone. >> i know. >> all the producers stop at 3:00 >> my stance on it is -- so they're getting millennials, right? >> everyone wants to get millennials. >> so how far back do the sports questions go would they mention ali joe wants to know if he has a competitive edge i saw them land on the moon. >> they gave me some trivia questions when i was there i got three out of four right.

>> anything has happened after the year 2000? >> what is one of the two teams that lost the most super bowls in history and i went with the bills. >> that's who i would have said. >> the patriots, because they tied forev d for five brady lost three >> i would have said bills, too. there's good historical stuff. >> were the new england patriots always called the new england patriots >> i think they were called the boston patriots. >> yeah. they were the boston patriots. do you remember that horrible logo >> that guy was change >> the new one is more -- >> i think you would do well >> yeah. >> there are millennials on the phone, but the sports questions are throughout the genre >> there's only one thing about getting old, you might actually know something you won't be totally clueless.

>> it's interesting when i sit around people at work, you go, i'm 24 years old i'm like when you come in at that age, you think you know everything >> your coworkers will love you. >> they already hate me. >> can hq be corrupted you hear about the parallel where they're searching something or there's an algo searching these answers? >> that's part of the game >> they are only giving you a few seconds to do it if you're really good, you have to go fast if you're doing all this to win a few bucks in general, is this the best use of your time? everyone who gets it right, if you get all 10 or 12 right, you share the money. if it's $5,000 and 100 people get it right, you only get 50 bucks. it's more for the fun. the more people that want to play, the better it is for them.

even if you're spending time doing it would you do the regular trivia or the sports focus? >> regular >> i could see joe doing the sports focus >> i was around. i know trivia. i know things that happened. >> at any time, any country, any place. >> going back more than you. >> these 15, 10 commandments >> sign up today >> if we decide to sing a song together, you know what we would both know the words to star spangled banner >> she doesn't even know who aretha franklin is the queen of soul. >> i know who that is. >> i was of the backstreet boys generation >> you're making his point >> the what? you admit you know those songs

who's the famous guy who came out of them? was there one? >> justin timberlake >> he brought sexy back again. >> you're ready to go. >> when we come back, apple shares hitting record highs yesterday. find out why warren buffett says he is still a big believer in the technology giant "squawk box" will be right back.

welcome back you're watching "squawk box" live from the nasdaq market site in times square. good morning welcome back to "squawk box. let's look at the u.s. equity

futures on this last trading day of the month dow futures down by 29 points. the s&p futures are off by 3.5 nasdaq down by 7.5 this market is still looking at an incredibly strong run for august the nasdaq is on track to have its best august in 18 years. the dow and s&p are on track to have their best august since 2014 we'll watch this today there are some red arrows this morning. among the stories front and center, apple aplans to announce the new apple iphone at an event on september 12th. there are some supposed leaked pictures the marketing image shows a new gold-colored option. the pictures also show the two sizes that the old model will come in -- or the oled model will come in apple is expected to launch a third 6.1 inch lcd iphone which will share the design of the

oled models. what is that bump thing? >> i don't know. with aluminum frame. shares of apple are hitting record highs yesterday we asked warren buffett about his investment in the company. >> i bought just a little bit. i like to buy them cheaper very difficult we started buying -- or i started buying when the stock was maybe 100. i was buying it as fast as i could. then i ended up buying some a whole lot higher that's -- i would rather have it go down. if it goes down, apple will buy a lot of stock back. if it dose down 10%, it means i get to buy 10% more shares and my interest will go up 10%

more for spending that money if i were to talk my book, i would talk it down >> so that's what he said. he would buy more if it went down he did tell us he's been buying more even since that last s.e.c. filing which showed they picked up additional cities >> you didn't bring me -- >> a brick >> no. i didn't even bring you a slice of cake. >> not even a lollipop >> he likes carbonated drinks. and he's 88 and worth 70 billion. he drinks five of them a day how did that work for him? >> has to be genetics. >> i can't get enough moderation i just -- i totally go all out on moderation. >> you're the extreme moderator.

>> exactly >> there you go. >> i want to talk about this president trump gripes against google, it's getting pick up in the senate fibs commnance commi. orrin hatch looking at the competitiveness of pricing here's what president said at a rally last night >> you look at google, facebook, twitter other social media giants, and i have made it clear that we as a country cannot tolerate political censorship, blacklisting and rigged search results. >> joining us is ed lee, media reporter from the "new york times. just to start off, ed -- welcome. i saw a weird article that said trump's attack on companies -- his attacks on companies has not worked then they went -- the author went and looked at the stock prices of any of the --

>> the ones -- amazon in particular >> yeah. who is to say that's his intention to knock down the stock prices he likes higher stock prices >> i think he's talking to his base it's a nice sort of target -- >> you don't think there's truth to this? >> i think the thing is if you're looking at -- he's talking about these companies, how they're doing a bad job. >> you don't think that -- do you think twitter, facebook, you don't think there's bias in terms of -- >> here's the way i look at it if you have somebody programming an algorithm on a search algorithm and that person is way left, it has to come through in that algorithm >> i've seen it. >> i'll throw cold water on that politics doesn't translate into

code >> ed is at the "new york times" and sees no bias at the "new york times" either consider the source. >> i'm a reporter. i'm stating the facts. >> what i found curious is when they responded to it, they said we publish the most relevant -- who is deciding relevant >> so they're -- it's a great question google and facebook, twitter, they're opening themselves up to attack, not because they're biased, but because we don't know there may not be a black box that's the liability there so president trump can go on air and say look at the bias >> it is also -- if you're saying you're showing the most relevant searches, it's a self-fulfilling prophecy, it becomes more relevant because people click on it >> and you get the bubble effect you only know what you want to know you can argue the rise of social media lapped becauhappened beca twitter and google

>> they were given a voice >> than they otherwise would have if you want free speech to be the fulcrum of the debate, that's a red herring the real issue is regulation does he want to regulate it? i don't think so but at same point it's a great talking point for the left and the right. they don't like silicon valley, neither side >> there's 100 engineers and the like at facebook that now have a new organization trying to say please please drive this car more to the center than the way it's being driven now what about when mark zuckerberg said we hire people near our headquarters, and we can't find a conservative out here. >> i think -- going back to your point earlier. if an engineer happens to be left of center or right of

center, and he's in the coding, that's not always an apparent thing. >> eric schmit went to -- >> deciding what your relevant sources are, deciding the sources, it's probably more biased towards the establishment than anything else >> that's the point. the google search ail go rilibim is established they get a lot of links. >> were you uncomfortable with how cozy eric schmit was with the obama administration sheryl sandberg offered up her services >> yes >> maybe they don't write code, but you don't think that's representative of the people >> they don't write code, but they steer the ship. >> if you're a conservative voice or ally or a person bhowh conservative, does that change

how you use facebook no >> i'm not saying what i am. >> okay. it's so unclear. >> also i'm not saying i'm part of any type of base, but it resonates with me. i won't bring up the new york times again -- >> bring it up >> i'm not bringing it up. >> he just did >> cicero. >> genius. >> some people say >> ed, thank you >> when we come back, love them or bash them, we all know about millennials, but what about gen-z, the head of cultural strategy at ey will join us on why this generation could be the game changer for the country you're watching "squawk box" on cnbc life is , you must want two!

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welcome back millennials have been the focus of employer and brand changes, but what about gen-z our next guest argues generation z may be may be pushing

companies further than their predecessors did joining us is marcy merriman director of cultural strategy at ey thank you for coming in. >> thanks for having me. >> let's talk about gen-z who are they >> gen-z come after millennials. gen-z is 12 to 22. it's a framework, a lens to help us understand social changes >> they're not zombies >> they're not zombies >> okay. >> all right >> world war sz? >> completely different. >> you know what they are different than millennials. i can tell you that. >> how do you think they're different? >> i think they're different because they want to have a lot of things, and they know that maybe you actually need to work to get a lot of the things you

want they want to buy apps. they want to be -- they've had a taste at this point of things that cost money to buy so i don't know. i'm not sure how we lost a lot of the millennials maybe they're coming around. i hear the older millennials are finally moving out >> the millennials grew up with the financial crisis >> they grew up hearing america wasn't exceptional, you didn't build that everything else. it's a totally different mindset. i worry about -- when i hear 57 -- how many millennials want to try socialism again with venezuela playing out right in front of their eyes? i'm hoping that the next generation doesn't have a 60% approval rating for socialism. >> i think the next generation is aware and one of the reasons for that is because of both the economic crisis but also the technology so if you think about millennials and what they grew up with, they can still remember life before wifi

dial up. trying to program a vcr. gen-z has basically had the palm of the universe in their palm since birth. they are aware of the evils in the world but also the opportunities. this does not only motivate them because they've seen the challenges of millennials, but they're also more prepared to get out there and do something about it they want to create change what does that mean for employers? >> employers need to think about this group coming in they're very motivated they're ambitious. they want to get ahead for companies, they get that they're in a constant state of reinvention. this is the transformative age everything is changing nobody gets that more than gen-z. the more that employers can look at gen-z and understand how to leverage them, use them, make them part of the solution, it can really benefit them. >> thank you very much for joining us today appreciate it.

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we're going to talk currencies right now joining us on set, the head of

currency strategy at wells fargo. i want to fly much higher on the whole currency issue here, nick, because i'm talking long term now. there's two competing forces in terms of economies, the united states is leading the world. i mean china grows faster, obviously, but with our gdp at least at this point, i don't know, maybe it doesn't last, but we are doing well in reference to the rest of the world which would argue for a strong dollar but we do have big deficits with interest rates presumably headed higher is the dollar in a long-term uptrend or the beginning of what could be a downtrend based on deficit issues >> we think they're in the beginning of a long-term downtrend. i think it started 2017 so we're about a year and a half -- >> against which currencies. >> most currencies that you want to choose. >> is it intentional for the trade imbalance that they're doing? >> no. a little bit is the risk that

you talk about and the widening deficits but a lot is with the natural ebb and flows with the economic markets you pointed out we're doing extremely well eventually foreign economies will catch up and the fiscal stimulus will fade so that gap is going to close and foreign currencies will strengthen over time. >> so it's not dollar weakening, it's foreign currencies strengthening as they join the party? >> yes. >> how is the dollar get weak when the fed is in a tightening cycle? >> much of their tightening is already expected it's priced into the interest rate futures and the 2-year bond yield curve. >> 2.84? that's high? >> those dots are the fed is around the 3% level. so it's reasonably fully priced in where are we going to see the activity and action? we think we'll see it in places like canada, but the uk and eurozone. >> should we try to do anything about it, a declining dollar

should we be happy is it good for trade or bad for assets coming here >> as long as it goes down in a slow, orderly manner and it's not chaotic and it doesn't scare foreign investors off, i don't think there's a problem. for my opinion, i'm indifferent. currencies go up and down and i'm not worried about it. >> does it have anything to do with if rates go up and we're trying to domestically fund our bond retirements and new issues? there's going to be a lot of supply, isn't there? investors are going to demand higher rates eventually. >> there is that and there is some concern that just as the federal reserve has decided that it's not buying as many bonds or starting to allow some of the bonds to roll off its balance sheets, the treasury, the government is starting to want to issue more so there's a little change in the supply/demand balance. >> thank you we have to leave it there. when we come back, september has produced some of the worst

stock returns of any month, so should we be nervous or will this year be different we've got answers when "squawk box" comes right back.

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new this morning, coke buying uk coffee shop jane costa for $5.1 billion the company is trying to diversify away from soft drink roots. details straight ahead. the countdown to a trade deal is on ♪ it's the final countdown >> will canada come to the table? the latest from washington is straight ahead. plus we hit the rails with the ceo of kansas city southern, a major player when it comes to transporting commodities to and from mexico. the second hour of "squawk box"

g begins right now >> announcer: live from the beating heart of business, new york, this is "squawk box. >> all right, good morning, everybody. welcome back to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm becky quick along with joe kern en. andrew is off this week. our guest host is steve grasso he's also a fast money trader and cnbc market analyst. thank you for being here mike santoli is here too u.s. equity futures at this hour have been under a little pressure we're talking about some red arrows down 24 points for the dow, 3 points for the s&p, the nasdaq off by 5.5 it does come after declines from yesterday. we'll talk more about that in just a moment. let's get to our top headlines at this hour campbell's soup may be facing

increased pressure from activist investor dan lobes third point is stepping up its campaign to find new board nominees and isn't convinced they explored the option of selling the whole company. they are putting their international and fresh food units up for sale. it was under pressure yesterday too. funds run by blackrock voted for an independent chair for tesla. that proposal which would not have affected musk's role as ceo was defeated those who voted against the idea were funds run by vanguard and fidelity. president trump will sign an executive order calling for a government review of rules surrounding retirement funds one being reviewed is that retirees be required to take withdrawals at age 70 1/2.

coca-cola is buying uk coffee chain costa for $5.1 billion. it is a rival to starbucks over in the uk. for coke, the deal adds to its push to diversify away from fizzy drinks towards healthier options. the ceo james quincy said hot beverages is one of the few segments of the total landscape where coca-cola doesn't have a global brand this will give us access to this market with a strong coffee platform mike santoli joins us with reaction to the deal steve grasso is here with us as well so this is your thing today, an individual stock >> i am aware of this as of 12 seconds ago. but yes, i saw the deal. i'm completely up on what's happening with the deal. >> sell it, mike >> these guys have -- you said that they're diversifying away from fizzy drinks? >> yes. >> not ready

fizzy drinks is good it's sugar. >> it's not only that, i don't know costa, it's a uk brand but it's been compared to starbucks. if it's starbucks, you can't convince me it's healthier drinks either. do you know how many calories are in those drinks? >> and the sweeteners you put into the diet drinks are totally on the way out. >> look, $5 billion is not tremendous for coca-cola, it's completely manageable, maybe it does make a lot of sense. >> it does diversify the portfolio. >> and i think the ceo has the benefit of the doubt. >> i've heard great things about james quincy i think people will give him a lot of room to run on these issues it's interesting it's a uk company. he's british we had a strategist here last hour that pointed out that some of these overseas stocks, a company in the uk, have been under pressure so maybe it's a good time to buy. >> all that makes sense. unfortunately, mr. buffett didn't give you a little bit of a heads up.

>> right. >> you also have to say in the past coca-cola's efforts for diversification sake haven't been the best. you want to go back to columbia pictures, maybe that's not the no, but this does make sense i think it's good for the stock not just to have dividend cash cow. >> is it something where you see the beer companies going cannabis and now you see these guys going a different direction. are they just too big? do they all have to fragment off? >> their core products are under pressure so you've got to find new ways. >> package food companies, and i guess the traditional beverage companies. this doesn't seem like a brand they'll take global, just like pepsico said soda stream isn't going to be leveraging their existing brands. >> when we looked at the dow's biggest gainers this morning,

coca-cola was up by 1.1% so the knee-jerk reaction is they seem to like it. >> the market likes when huge companies turn cash earning very little into a business i think you had a positive reaction to pepsico. you go back further, microsoft buying linkedin. but it was cash and they said fine. >> look at the marketplace, both these companies, coke and pepsi, are down on the year so this is something where investors are not looking for growth at all in these segments. so they're trying to figure out growth but to becky's point, if the core is not growing, all this incremental growth isn't going to save the names or the stocks. this is a trading show. >> i thought the trading show was later in the day. >> this is not "fast money"? >> is that the '80s? >> yeah. remember when they had jeans >> whose idea was that coke and a movie studio?

why? >> just american brand i mean that was a conglomerate thinking. >> that was like an itt. you know, if we could roust him, we should have had our boss in here to talk about this. fat chance at 7:00 to get him in here all made up. >> nick, if you're watching, call in. >> he's either watching or listening, otherwise i wouldn't have said that. >> you're gonna hear. let's get to the real reason we brought mike in that's because the markets are about to enter the month of september. with him it be back to school or an endless summer for stocks mike has more on that and this is something he knew he was going to talk about. >> that's right. everybody knew at this time we talk about september is a weaker month for the markets. the history is pretty enclosucln that midterm election years are more down than up so history is

pretty clear but context matters too. one of the bits of context is why do we think september is a weak month usually when it is particularly weak, it's because it's an unusually tough month for downward earnings forecast revisions. in other words, over the course of july and august, you tend not to have a clear view and analysts aren't revising their estimates as much. sometimes the summer slows down more than people expect. >> everybody is on vacation, whether the companies or the analysts. >> so liquidity sometimes longer term, you can go back. years ago you had to have banks' help to fund the harvest so why matters. but i think what's more relevant is in strong years, september is not as scary so when the market has been up going into september, that's usually not when you get a major downside inflection point. one quick data item on this, when the market has been up at least 5% at labor day, which we're up almost 10%, it's

continued higher by year end by a significant amount. >> that's a lot to the with the chasing of the funds trying to pass the benchmarks. >> last year september was not even a hiccup. so in 2002, 2008, when september just buried you. you already had a little bit of a struggling tape. >> let me throw this out to both of you that's a good point that it's funds trying to catch up with the benchmark, you have only a few months left to make that happen what happens in january and february after that? >> january usually is weaker on average, but nothing is static you can't say that things are always going to happen, but you always see that little bit of a give-back in january and people start and reset for the year all over again. >> i also don't know how to make sense of the fact that seasonal stuff has become so well known like if you go back 20 and 30 years, it was a full people in dusty libraries who were looking

at this all the time in the business as opposed to everyone saying, well, september is here. or sell in may, that didn't work this year again. so it's tough to sort of say that it really is a driver it just presents the backdrop of broader tendencies. >> as we all get this information, the inefficiencies, the market gets squeezed out. >> we haven't been trading stocks that long in a measured way. the dow has a 120, 130-year history. that's a statistically significant sample when it comes to what a given month is going to bring worth considering. >> i used to think 120 was a long time. i don't anymore. i don't think that anymore. >> that's funny that you're saying that. i could apply that to something else but 150 years is not a long time, it's almost background it's almost statistically insignificant. >> right >> if you want to make predictions off it on a 4 billion-year-old planet

>> okay, never mind. never mind >> you said it so clearly and certainly there. >> don't misappropriate. >> people are willing to buy in anything let's bring in karen cavanaugh, senior market strategist at voya ♪ voya hi, karen. did you hear what mike was talking about? are you in the same camp >> the endless summer or we're going to have back-to-school blues? i think that the market will continue to move up because companies are continuing to move up i think that a year ago we were talking about the global synchronized expansion, but we had tax cuts, we had deregulation so the u.s. has moved to the head of the class and we're going to continue to go higher. sure, there will be trade tensions and a couple of steps forward, one step back, but the earnings are doing well, the

economy is doing well and so there's really not that much to worry about. if we didn't have trade, i'm not sure what we would be worried about because things have been so good. the data we get just keeps coming in very robust. consumer confidence. yesterday the pce numbers are finally at the fed's target. i'm not really sure what more investors could want. >> and trade, that's one of your concerns, but it could be -- trade could either be a negative, it could be neutral, but no one ever talks about that it could be a positive alarion was actually on -- that's a cool name it sounds like in some kind of movie or something he would be the protagonist. but he said his numbers were like 65% that trade stays basically the same and maybe is a little better because we improve it a little. 15% that this is a reagan moment

where you throw out the old model and it's really good or 25% it could be a bad outcome. so 65 plus 15 is -- how much is that so that's -- >> so overall things are going to be better. >> so to say trade is the only fl fly in the ointment, theoretically, we don't know if it's going to be positive or negative at this point now, is it just as simple as if i look at earnings per share growth, you know, year-to-year, can i just say that the market should move up that much, even if multiples stay where they are, i should get a starting that correlates with earnings gains? >> it should definitely correlate with earnings gains. what are you doing when you're buying a stock you're buying that earnings stream so that's the fundamental driver of the market. now, sentiment does play into it and at times investors are willing to pay more for earnings than at other times. one of the things that's keeping

us on track is investors have not been euphoric, they have been a little pessimistic. we haven't seen the euphoria in the market, which gives me more confidence that the market is going to go higher because twefr investors are being a little picky. so this is a market that doesn't so any signs of froth really that investors are being -- they're being particular about what they buy. they're looking for quality earnings and multiples are not off the charts, they're right in line. we are worried about trade we're worried about emerging markets. we're worried about the rest of the global economy not keeping up with the u.s. but right now the u.s. is the place to be and it just keeps coming in better and better. so i have high expectations for third-quarter gdp and i'm looking at earnings growth for the third quarter and it looks like it's really just -- in fact a lot of sectors are ticking up the automotive sector is the only one that had some revisions

down overall earnings continue to deliver and that's a great sign for the market. >> we've got to go why do we find you in charleston today? >> because i live in charleston and i split my time between charleston and new york. >> that's awesome. great restaurants, great spot. this weather near kiawah, a lot of something stuff down there. karyn, we appreciate it. mike santoli, thanks, mike i like that tie. >> have a good, long weekend. >> what's the protocol, i send it to you now, the tie >> do you like coming on i don't know, sometimes i think it's too early for you >> he never says no. >> before the knot gets dirty. >> from your makeup? >> too much playing with it. >> mike doesn't wear makeup.

>> gilding the lily. actually i need a knife. i need a scalpel, not makeup. coming up, the president's self-imposed trade deadline is here canada has yet to secure its place in a new nafta agreement the latest on what to expect today in washington is next. then later, the ceo on kansas city southern on how a new deal will affect business. the company is a major provider of rail service between canada and mexico stay tuned, you're watching "squawk box" on cnbc ♪

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simple to rent, easy to buy, awesome to go. today marks the deadline for a new trade deal between the u.s., mexico and canada. i thought we said good-bye, skyler >> you're just jealous of my tie, joe. >> that's it bring us up to speed again, eamon. >> look, we don't have any information about what's going on in these negotiations behind closed doors the president said last night that canada ought to come on board or else he'll slap some tariffs on the canadians, so that's an important warningto bear in mind as we go into the last day of this deadline here the president giving a

wide-ranging interview to bloomberg yesterday, fascinating conversation in which he said a number of things, including the deal with canada may come on friday or within a period of time, so not necessarily holding to today being the deadline, offering a little wiggle room there. he said the european offer for no auto tariffs is not good enough and he said the eu is almost as bad as china on trade. so i think the president is very much focused on this trade deadline today, as is all of official washington. no puff of white smoke from the u.s. trade representative's office yet but everyone has been making positive noises and sending positive signals about what's going on behind the scenes the expectation is for a deal. we'll see if expectation lives up to reality. the other deadline people are talking about here in washington today is what happens with the mueller investigation. remember, there was some speculation that bob mueller would be wanting to put out anything that he had before labor day because that would keep it out of the sort of

election season traditionally beginning after labor day. a lot of people focused on today as a day in which mueller might release something. i can tell you that we're hearing absolutely no footsteps on that at all but generally speaking with these mueller announcements, you don't hear anything in advance so some speculation that today might be a day to watch on the calendar as well we'll wait and see, it could be a big day. >> i saw those stories as well, eamon, in particular about -- the way the headline read, it seemed like here we are, we're in the weeds, but i thought somebody knew something. >> nobody knows anything. >> they didn't know anything they just said because tuesday is too close to the election, if anything from mueller is coming, it was kind of a weird article because it said obviously there's collusion because he would have ended it by now so if he's going to bring out the collusion, it's going to have to be today because next week is

too late it was weird -- that was a weird -- >> yeah, there's no basis to say that obviously there's collusion. we don't have evidence of that publicly and we don't know what mueller has discovered. >> that was implied in the piece, that it's gone on this long people around mueller know that he would have ended it by now if he didn't have something so that it's going to come today because next week is too late because it would be a comey situation. >> that is speculation by the transitive property of speculation. we just don't know that's the thing about mueller and his investigators, they haven't leaked at all. all of these indictments that mueller has announced so far have been surprises. i will say that roger stone, the former confidant of president trump, has been signaling that he expects to be indicted or arrested at any moment. >> that's what i think if there was something, he may -- i think it's the fervent wish of some people but if i

were to try to figure out where it could be, the guccifer stuff, whether he knew that something was coming, whether he told the president something was coming, he's a -- he's kind of a -- he's out there. i've seen some of the previous stuff surrounding him and just in general >> it's nothing in the chain that people are going to want to look at. >> they even interviewed his friend that ran for office, the madam of some brothel. it's some bizarre -- >> roger stone's career goes back to richard nixon. he's got a tattoo of richard nixon on his back. he's a legendary political dirty trickster. >> i thought it was just me with a nixon tattoo. >> you might be the only one, mike. >> there's other stuff too, in personal ads for some crazy -- >> there was something of a sex scandal during the dole campaign

back in '96 roger stone was involved with. >> was that true >> he stepped down from the campaign in '96 after some publicity surrounding that, but it was related to his personal life and not to anything in any official capacity. >> eamon, you are better than wikipedia. >> i try. >> that's good get him on that trivia game, i bet he knows all that stuff. >> i could see a reagan tattoo i don't know about nixon. >> i thought you had one. >> yeah, i do. >> eamon, thank you. we'll see you later. >> let's all keep our shirts on today. >> please, and every day. when we come back, the ceo of kansas city southern talks trade. they are a major transporter of goods and commodities between the united states and mexico we're going to find out what a new nafta deal might mean for them who said the tattoo was under your shirt "squawk" will be right back. time now for today's aflac trivia question.

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good morning, everybody. welcome back to "squawk box" here on cnbc we are live from the nasdaq market site in times square. here are the stories that are front and center this morning. shares of big lot's are under pressure after the company fell eight cents short of expectations with a quarterly profit of 59 cents a share comparable store sales did beat what the street was expecting but they gave weaker than expected guidance and that stock is off by 12%. two economic reports are on today's calendar the chicago purchasers management index is out. that will be followed by the

consumer sentiment index the s.e.c. wants to make it easier for individuals to invest in companies the commission is weighing an overhaul of rules that were put in place to protect individual investors. they have strict income and net worth requirements before investments like this are allowed. apple plans to announce the new iphone in an event taking place on september 12th. there are already some supposed leaked pictures. the marketing image shows a new gold color option. they had explored a gold iphone x last year. the picture also shows the two sizes that the model will come in apple is expected to launch a third 6.1 inch phone that will share the design but with an aluminum frame meantime check out shares of apple. new high yesterday, the day before and right now indicated up another 60 cents to $225.63

yesterday we asked warren buffett about his investment in the company. >> i bought just a little bit. i like to buy them cheaper we started buying or i started buying when the stock was maybe 100. i was buying it kind of as fast as i could and i ended up buying some at a whole lot higher i won't name the exact price but a whole lot higher i'd rather have it go down if it goes down, apple will buy a lot of stock back. they're already buying stock back if it goes 1down, i am benefited if i would talk buy book, i would talk it down. >> he said i bought just a little bit that's what he's talking about since the last s.e.c. filing in all berkshire hathaway owns 5% of apple's outstanding shares it's the biggest position for berkshire hathaway by a long

shot the next biggest position is wells fargo and it's less than half that amount. kansas city southern recently hitting a 52-week high after the u.s./mexico trade deal was announced earlier this week. the railway operator transports industrial, consumer and petroleum products between the two countries with half of its tracks in the u.s. and the other half in mexico with us to talk about all of this we have pat -- i can say it without it being all messed up like that. ottensmeyer, how's that? you should see what they put in the teleprompter for me. do you believe that, steve they think that's helpful. i want them to show it i guess they're not going to the president and ceo of kansas city southern. how closely have you been watching these negotiations? more than the average person, would you say? >> oh, yeah, more than the average person it's been a very high priority

for us and for me personally it's very important to us and to our customers. as you mentioned, half of our company any way you look at it is in mexico half of our employees, revenues, miles of track we are really a mexican company and u.s. company that happen to be combined at the top but mexico is very important to us >> the deal that has been proposed, since you're watching it so closely, do you think that it gives you 50% of what you want, 80%, 10% is it a good deal for kansas city southern? did it need to be addressed? >> it definitely needed to be addressed. i think it's a good deal for kansas city southern i think it's a good deal for the country. the details are to be

determined as you know, the agreement itself hasn't actually been publicized and we haven't had a chance to read the details, but certainly a modernized nafta, an updated nafta made a lot of sense for the country and certainly for our company and for our customers. generally i would say we're very optimistic, very hopeful that this is going to be a good outcome, but we haven't seen the actual agreement, the text of the agreement. the details are going to be very important. >> i don't want to leave nafta entirely and i'd like to ask you what you didn't get that you wish you did and there's the whole canada side of the equation but just in terms of business, i read we can't find enough guys to drive trucks. things are sizzling. is it the best time you've ever seen for the rail group? we move a lot of stuff on rails.

and the energy sector is hot i can't imagine you've ever seen any better times than you're seeing right now, or correct me if i'm wrong. >> it's a good time to be a railroad i think if we get a good outcome here on the nafta renegotiation, it's a good time to be in mexico >> would you think canada comes around what are you hearing there you probably have some -- pay some people to figure out the probability of these things. is this going to work today or in the near future >> you know, i think so. i certainly hope so. i think the canadians have been brought into the negotiations here recently and i think there's been ongoing dialogue with the canadians they haven't been completely shut out from what we've heard, but i think it's very important to keep the three countries together, to keep the agreement

tri-lateral. it makes tremendous sense to do that but as far as other things, did we get 50% of what we wanted, did we get 80%, the details are important. we haven't seen the agreement. i think it's probably closer to 75% or 80% or more maybe. there's some things that were important to us that given our investment in mexico, the investor state dispute settlement process was very important, and it seems like that ended up in a pretty good place for us we've invested $5 billion in mexico over the last 20 years, so that was certainly one of the top priorities. >> any concerns with the new leadership in mexico many people surprised that the populist president seems to be kind of a capitalist i think he wants the best for mexico's people, obviously

can you work with this guy any concerns at all about your investments in mexico? >> not at this point i think -- i had the opportunity two days ago to meet with a gentleman by the name of alfonso romo who is the chief of staff and by all reports one of the closest advisers to the president-elect. i liked what i heard he talked about their economic policy, their trade policy, their foreign policy the top priorities for the new administration seem to be corruption, security they understand the importance of the economic progress that mexico has made, the foreign direct investment, and i don't see really a desire to change any of those policies. so i like what we're hearing from the new administration. the outreach that has occurred between the u.s., the trump

administration and the lopez obrador administration has been very positive. the trip with secretary pompeo, mnuchin, and jared kushner a few weeks ago was viewed very positively in mexico, so it seems as though the desire to strengthen and improve the relationship with the u.s. on the part of the mexican administration should be very positive >> we -- i don't know. everybody loves trains i still love trains. think about it. >> why not >> it's an old way of doing things, but it's still so relevant and, i don't know, it's nostalgic and everything else. who doesn't like trains and choo-choos we hope to have you on before. buffett loves trains too.

>> i know. >> he just loves making money. >> he actually really likes trains too. >> who doesn't like trains >> well, if you think about the importance of critical infrastructure like rail, ports, highways, all of that, to a nation's economy, it's hard not to love trains. >> we've had 150 years to come up with something better and i don't think we have. barges are okay, trucks are okay. >> you need all of it to get goods moved across the country. >> you need all of it, that's right. >> all right, thank you. we appreciate you coming on today. >> thank you i'd be happy to come back. >> you'll hear from us, thanks kansas city southern. when we come back, ready to hit the road for the holiday weekend? we'll take a look at the recent spike in gas prices and whether or not they will remain at current levels that's our conversation next. plus, much more of the deal of the morning, coke buying uk starbucks rival costa for $5.1

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welcome back to "squawk box. the futures right now have been trading in the red most of the session, down about 35, nothing substantial. triple-digit losses yesterday after five straight gains and some new records on the s&p and the nasdaq but today a little bit of a pullback at least so far this morning. shares of ulta beauty coming under pressure the makeup retailer reporting better than expected second quarter earnings, but revenue was just in line while same-store sales and the company's third quarter outlook in fact did miss forecasts as you can see, that's a big, big loser, down almost 4%. millions of americans taking to the roads and the skies this weekend for one last summer trip our next guest says that it is the most expensive summer and labor day for gasoline in four years. joining us now is patrick dehan, the head of petroleum analysis at gas buddy patrick, what's going on what's happened?

>> becky, you know, as we go into the last major summer driving holiday of the year, we're talking about gas prices that are just a penny above the low point for the summer, so not all that bad but when you rewind to prior years, gas prices quite a bit higher the highest labor day gas prices we've seen since 2014. like i said, if you rewind back from 2011 to 2014 what we're seeing today would look really good with prices back then well over $3 a gallon so still not too bad of a time to hit the road. >> patrick, when you look at all the geopolitical stuff that's going on, are you shocked that these prices are actually still in the realm of reality? shouldn't they be off to the races with everything or has the market just become basically anesthetized to what's going on in the world >> that's right. i think the noise has just been so equal really on both sides of the price of oil you look at all the issues and oil prices have been range bound

much of the summer staying between $65 and $75 a barrel it seems for every good or bearish or bullish piece of news that would affect the price of oil, you would see an equaling factor a few days later and that's kept oil prices in a relatively tight range looking back at our data since gas buddy has started 18 years ago, it's been the second quietest summer at the pump. the national average only fluctuated 13 cents between the summer low and high, so remarkably quiet keep in mind all these geopolitical tensions could flare back up especially as sanctions are set to kick back in against iran. >> patrick, how much of this is demand side too? we have seen an incredible strong economy here in the united states and things are doing pretty well around the globe at this point. >> that's right. demand has been very strong this summer gasoline demand was up about a percent versus last year so far refineries have been able to meet that incredible demand they have been kicking out

gasoline, diesel, jet fuel at breakneck paces this summer. so at least at that moment this summer we have not had a problem at the nation's refineries keep in mind hurricane harvey a year ago shut down a third of the capacity of the country when it comes to refineries so we'll have to see if there's any impacts in the weeks ahead. >> we just had a story yesterday brian sullivan talked about with citgo. is that a big enough deal to have any impact on gas prices? >> it certainly could have some potential. what's going on in venezuela from not only the refined product standpoint but crude oil production there, that's been kind of the rising star, in fact the opposite of the rising star i suppose is that venezuela has been producing less and less crude oil. so watching citgo and watching what may happen there with venezuela's assets that they currently have being seized back

from them, of course hugo chavez nationalizing the oil industry there is certainly a potential source of pain watching what will happen this fall moving forward. >> all right, patrick, thank you for joining us. >> my pleasure. >> patrick dehaan from gas buddy. coming up, stock ideas and market predictions from guest host steve grasso. check out the futures which you just saw about a minute and a half ago but check them out again. we'll be right back. year, i am sorry about that. [music playing] (vo) progress is in the pursuit. audi will cover your first month's lease payment on select models during summer of audi sales event.

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who could dislike that song? >> joe. >> i feel happy when i hear it. >> every friday. anyway -- >> it's groundhog day. >> groundhog day get your booties because it's cold outside more trouble for tesla and elon musk. blackrock voting in favor of a recent shareholder proposal requiring tesla to replace elon musk with an independent chairman the proposal, which was defeated, would not have affected musk's standing as tesla's chief executive officer. i saw some more tweets from him. he's still tweeting. >> he tweeted last night. >> something about steve bannon.

>> he said it's the best pr he's ever gotten. >> that's like throwing -- i mean i do it too >> you do. >> i know, sometimes on twitter. but rise above that. it's childish. >> i think that's him, though. it's his personality so you talk about president trump, that's his personality. >> you know what, i didn't -- i've got to share this oh, i wish we had more time. i didn't realize how great that cuomo/cynthia nixon exchange was until i really thought about it. he says stop interrupting. she says stop lying. he says i'll stop lying when you stop lying. >> so they're both lying. >> so they're both lying hey, andrew, that's -- whoa. i didn't think it threw because what he's saying is you're lying too is what he meant to say. >> i'm not going to stop until you stop >> i love it >> let's look at -- don't put

too much stock, right, in what you see today. the action is we've had a mar marketplace on fire. we've had the u.s. markets outperform emerging markets, so you could see some profit taking today. to mike's point earlier, when september is a weak month historically for the market, you could see some profit taking, but you're going to see that chase at the year end. whatever you see with the pullback in the market, it's still a buying opportunity. >> just the idea that now you're going to have funds having to chase 10% gains and the benchmarks, otherwise they're going to look like they're underperforming the benchmark. >> they're facing alpha and have to create it sometimes on their own. >> steve, what else are you watching today >> if you look at technology, it's interesting, when we had the gentleman on for gas buddy, when i look at the energy sector, so i spoke about how discretionary has outperformed for five years, financials and most of all tech

you know what's underperformed for five years energy you could buy dips it's volatile. but for the long haul you want to be invested in technology that's where the growth is that's where you want to go. >> you want to be invested in technology because of the energy >> no, i think that these technology companies are different than what they used to be when you brought up is it a demand issue, i think it's a supply issue in the energy space. we're oversupplied and the market hasn't gotten their arms around it yet. >> technology names beyond some of the big headline names or are you talking the big headline names. >> i think you have to go with the big headline names the s&p is market cap weighted so they pull this market up and are in every aspect of technology. >> i hate to talk really short term but next week you are headed into these hearings where many of these ceos or top executives from these companies are going to get pulled in front of congress. does that matter

>> i think the headline risk was really pulled to the extreme with facebook. so all of these stocks, twitter, which i'm long, have already reacted to a lot of these things yes, they can react day-to-day but longer term i think it's already in the numbers. >> that's great. steve, i want to thank you so much for being here. we got two hours with you. >> i'm going to go do my day job now. >> we'll see you later on wapner. >> i love hosting that show. >> i messed up last time >> it's "closing bell. >> "fast money." we will see you soon have a great weekend. coming up, we're going to talk markets, trade, and the economy. then later, high times for marijuana stocks the ceo of canopy growth will join us to talk about the booming business of bud, tasty bud, i guess, could be the adjective.

we'll be right back.

breaking deal news coca-cola buying a uk coffee chain for more than $5 billion we'll hear from coke's ceo on the strategy straight ahead.

deal or no deal? the u.s. and canada racing to agree to a new nafta before a self-imposed deadline. plus pot stocks are flying high the ceo of the world's largest publicly traded marijuana company will join us live. the final hour of "squawk box" begins right now ♪ see you in september ♪ see you when the summer's through ♪ >> 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 becky quick. our guest host, sirat, a managing partner at douglas lane and associates the futures right now down at 49 that's a little worse than earlier. add it to yesterday and it's a couple of hundred points on the dow. the nasdaq, which had been up

significantly the previous five sessions to a series of new highs. it must be up 4% for the month, close to it for august, and the s&p was up as well a couple of days ago. >> the 30-year is below 3% for 30 years they can hold your money and you still can't get 3%. >> you don't need to hold it for 30 years, but you do have principal risk and people are still willing to buy it. i don't understand i don't know what it says. i think it's a global -- the bond market seems more global than the stock market obviously. i mean that's obvious, i think it still has to do with our -- >> it's primarily the negative rates across the world why pay somebody to hold your money when you can get 3% or now less than 3% but to the point that if and when rates move, the principal risk is something that, a, when you own the bond individually or if you own a bond fund, then you

basically lose the principal. >> but it wasn't that long ago when you were paying someone to get your money back in five years. >> that's still the case in europe. >> to get your principal back, you're actually paying. >> return of your principal. >> but paying for it i mean it's like -- you can't use a mattress for big money. >> there are certain institutions that have to own bonds and that explains part of this, but not all of it. >> and it's the hedge against the weakened emerging currencies if you are overseas and don't want to lose more and more money locally or hedging your working capital, you're buying u.s. which has this effect of how do our rates move because they're artificially being changed. >> we're going to continue this market conversation in just a little bit but let's get to today's top corporate story. coca-cola is buying uk coffee chain costa for $5.1 billion costa was founded in london in 1971 and is a rival to starbucks

in the uk. sara eisen joins us from the nyse she just spoke with coke's ceo sara, two big deals in the beverage industry just in the last week or so. this is a lot happening. >> and the common theme, becky, on those two deals, pepsico buying soda stream, coke buying costa coffee the beverage giants are diversifying away from colas, carbonated soft drinks, and moving to where the consumer is going. consumers are going into coffee. this is a market that's growing 6% globally. this really is a global play so i just talked to coca-cola's ceo james quincy about the strategy behind the deal one of the major questions i had for him was really retail operations? costa has about 4,000 stores across 30 countries, not in the u.s. but it is a different sort of business for coca-cola to be in. he told me clearly part of the coffee strategy is having stores because they build business and the brand.

we are buying a great management team, which importantly he's keeping in place, that knows what it's doing in retail, clearly not our core competence. along with roasting coffee, that's what they're bringing we're bringing the global scale. week introduce different formats as a total beverage provider in some places, you might see stores, beans and machines he really emphasized that this is not a retail strategy and not a food strategy because costa also sells pastries in its stores it is a beverage strategy. taking the brand of costa and bringing it to places like the u.s., not necessarily in terms of stores to compete with starbucks, but in beans, in vending machines, food service areas. here's the quote when i asked him what the plans are for the united states. if we come to the u.s., according to quincy, it's more likely to be in support of food service, not stores. there's a lot of stores in the u.s. there's more room for growth in europe and asia. food service, of course, they have mcdonald's, contracts with

burger king, some of the biggest restaurants in this country. clearly there's an opportunity to get more coffee vending machines and beans into those stores finally as it relates to the deal and what it means for coke shareholders, quincy tells me coca-cola shareholders got a good deal because we can take this global in a way that nobody else can different estimates as far as what they paid the financial times said it's a 20% premium off of the market value. the parent company based in the uk clearly coke shareholders are happy with this deal, which really speaks to two big trends in the beverage space. go to where the growth is and it's not happening in -- it's happening in coke a little bit more now and maybe starting to come back in diet coke, but it's really happening in places like sparkling water, hence the sodastream deal. in coffee, hence this deal, and very much overseas as well, which is a play for. >> big write-up in "forbes."

you are something. that was not me, was it, with the george bush 1992 alan greenspan -- who was that, sara? seriously, who was that? >> it doesn't matter who it was. i get those references all the time people think it's you, which is funny. >> i know, and it's not. you're from the -- >> no, you're right, that is a bond i don't share with many other people here. >> we'll always have montgomery in. >> how about montgomery. >> we could do that. it's not my favorite. >> my friend evan is not -- really, have you tried it? great sauce. i will defend -- >> i think i go to cincinnati a lot more these days than you do,

joe. >> you're right. my parents are gone now. but i did -- we go every once in a while. we're going to go back i do love it there. >> you won't recognize it. downtown has been totally revitalized. it's amazing >> anyway, all right, good work, sara. >> thank you, joe. >> and it wasn't me. i want that -- >> it wasn't you. >> on record it was not me. among the stocks to watch, and everybody can see this on "forbes" if they want to. >> i'm going to look this up right now. >> it's pretty good. >> fill me in on the back story. >> just talking about how successful she is. she's young and that she's had with some people that have said you couldn't know about something because you're young. >> we just had this conversation about -- >> that's why people think it's me she was talking about when trump was sort of trying to massage the fed about not raising rates, she said, well, that has

happened before with the first bush back in 1992 with alan greenspan. someone was like how could you possibly know about that. >> who was it if it wasn't you >> i want to know, that's why i asked. that's why i asked, because thought it was me. >> i'm messaging sara right now. i'm not going to tell you because i want to know the answer. >> i've got a few ideas. trade is once again the big story for the markets. china is responding to reports that president trump wants to impose tariffs on $200 billion on chinese goods as soon as next week china's foreign ministry says putting pressure on beijing over trade won't work it will be a major escalation of the trade war with china i just can't imagine where you get to 200 but more than 50% of chinese imports would be subject to tariffs. and that's -- that's not a skirmish, that's close to the "w" word, isn't it 200 billion would get everybody's attention.

>> i think it will hurt everybody. at that point nobody is going to back down because the first person who backs down loses. so -- >> a big game of chicken. >> right you can't blink at that point. china takes a much longer view than we do if they say we can stay through this and there's collateral damage there's all the unintended consequences of other countries that we do trade with, products get more expensive so it will be interesting to see how this plays out. >> so you don't buy the argument that's been posited that china's leadership, while they have a longer term view and have a longer game plan is also up against maybe a harder place when it comes to their economy. >> it will hurt them more than us. >> but i do think -- i'm not saying it won't happen but i think what will happen is they will probably let it happen but then negotiate pretty quickly to say, look, we didn't let it happen because if they do let it happen, then something comes

down the road next year. >> we're asking them to change the whole intellectual property -- the way that they do that it's not just tariffs. it's not as simple as just trade barriers >> but china as it's developed has more at risk in terms of intellectual property too so there may be a way to finesse something. >> how do you marry the reputational risk with the economic risk. that's where the negotiation comes in maybe there's hopefully in the last inning, hey, we're going to sit at the table now, put all these things to the side and come through with something. kind of like what's going on with nafta right now. >> it seems like the administration is moving towards this path that a lot of ambassadors from both sides have kind of suggested. a lot of the trade experts say you've got to get all your allies on your side first. >> get your ducks in order. >> wrap things up with canada and mexico, try to figure something out with the europeans and maybe it's the whole world versus china which maybe you have better odds in. >> you have a better chance.

and the stock market, our market really hasn't reacted that well -- i mean that badly. china has. so this will bow a very interesting next few days for sure. in europe, the trade fight is hitting shares of car makers this morning yesterday president trump rejected an offer from the european union to get rid of tariffs on cars if the u.s. does the same, calling it not good enough in an interview, trump said that the eu is almost as bad as china, just smaller. european commission president jean claude juncker said the eu will respond. >> and then there is canada. negotiators are in washington today trying to work out a new nafta deal today, before today's self-imposed deadline. joining us now, a former national foreign trade council president and former undersecretary of commerce in the clinton administration and he's now with csis the signals that we're getting

right now, bill, will it happen today, do you think? are we close enough or are we still far apart? i can't read the tea leaves between trudeau and what the president is saying. >> the canadians don't talk quite as much as the mexicans talk publicly, so it's harder to tell i would say 60/40 they make a deal tonight 80/20 they make it in the next month, which is the real deadline if they send the letter to congress today notifying their intention to enter an agreement, they have 30 days to send up the text if they don't nail everything down today, they still got four more weeks to finish it off. >> we've talked about all of our -- i'm not going to call them opponents, but our -- not even adversaries, but people on the other side of what we're trying to do here, whether it's mexico or china or the eu or canada no one wants to lose face in these things and we actually have to think about that because everybody has their own domestic

concerns about how it looks. is it possible to come to something where trudeau can say i got this for canada and trump can say i got this for the united states? it seems like a couple of those things, someone wins and someone loses. it doesn't seem like it's a win-win. >> that's a good point it will be difficult it's easier than with china. the canadians have entered into this phase of it with i think the right spirit, which is let's forget about the insults, let's forget about the pressure, let's focus on whether we can do something that's good for canada polling up there suggests that the public backs trudeau in that approach so they're being constructive i think everybody is talking yes, it's possible i think the administration in recent days, certainly with mexico, showed some willingness to compromise on some of the things they put out. there are some tough issues for canada, no question. some of the things that we're asking would force them to change some of their laws that have been in effect for a long

time but i think it's possible. people seem to have a good spirit about it. better than in the china/u.s. fight that's going on right now. >> as you've watched it play out, would you have -- i mean when you're watching this play out, and you worked for bill clinton, is there -- what would you say your reaction to watching it happen was were you ever saying, wow, that's pretty good, i wish we had done this, or wow, this is improving some things or were you like, wow, we would have never approached it this way is it maybe a little bit of both >> it's been really hard to separate the rhetoric from what's actually on the table i think that's what's complicating things in washington where people can't unpack those things. in the trade negotiating world, usually you look for win-win outcomes we get something, they get something. if you're a really good negotiator, you the the other guy to believe that he got more than you did, even if it's not true the trump approach to

negotiating always is win/lose i don't really win unless i humiliate you and you lose you have to have to kind of get beyond that. i think what ambassador lighthizer has shown is some degree of flexibility. we can have a longer discussion about whether their ideas are any good and also whether what they propose will achieve in terms of more jobs in the united states that they say they want to achieve i think what's going on behind closed doors is more traditional. if the president frankly would just stop talking and stop tweeting and let this proceed, i think it would be easier to get to a successful outcome. >> i can see both sides even to that i hear what you're saying and then there's times where i think -- i don't know whether you call it tough love or what we were talking about it earlier, that like the eu, they have never seen anything like this

where someone just says outright, they're our allies and he says you're as bad as china it's like they have never seen anything like that but suddenly they might take a look at some of the stuff we've done and, well, maybe we can't get away with some of this stuff like we used to anymore. >> it's put on the table issues that people have been able to avoid for a long time. >> right. >> at the same time, today it's incomplete there's only -- of all the things he started, there's only one that he's finished sort of and that's korea even that's in doubt because of the continued threat of automobile tariffs you can't really make a final judgment on what you're saying until you see the product. but he certainly teed up the discussion i guess he deserves some credit for that >> well, it's nothing if it's not -- i don't know, i think -- i think that your boss might be closer on some of this stuff than the current state of his party at this point.

he was a pretty economically savvy guy. i don't know where that party is right now. anyway, bill -- >> i'm not going to get into that. >> i know, i know, i know. i know you're with me. anyway, former national foreign trade council president, appreciate your time, thank you. >> thank you. when we come back, shares of canopy growth have been flying high this is the world's largest publicly traded pot company. canopy's ceo will join us live, next. first as we head to a break, take a look at yesterday's s&p 500 winners and losers

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on the go and want to rent a movie? showtime. or buy the hottest shows. even here? we've got you covered. now they are all yours. to take on the go. on any screen. bingo! alright! and watch whatever you buy. wherever you are. head to xfinity.com/stream to start watching. simple to rent, easy to buy, awesome to go. canadians are awaiting a decision on legalizing recreational marijuana this fall one of canada's cannabis companies has already hit the ground running joining us right now is bruce linton, canopy growth corporation's ceo, founder and chairman canopy, by the way, is the

largest publicly traded marijuana company by market capitalization in the world. it was also the first to list on the new york stock exchange. bruce, thanks for being here today. it's good to see you. >> thank you look at the scene behind me. this is actually ottawa. not a bad friday. >> not bad at all. the picture looks beautiful. i hope it's really that gorgeous in reality right now. >> it is. >> bruce, let's just talk about what's been happening. your stock along with several of the other publicly traded marijuana companies has just taken off as we get closer to legalization in canada just the idea that this is now an opportunity that some of the big players want to jump into. i know you've got constellation brands that took a stake in your company. diaggio is interested too. the stake that you have with constellation, would that prevent diaggio from doing a deal with you?

>> yes but october 17th in canada adults will be able to go to stores across the country and legally buy cannabis in anticipation of that, there's been a bit of a pack mentality so we're seeing a lot of retail investors feeling if they buy five, they'll be happy now we're starting to see many of the firms all come up together as we sort of rerate the sector, about two weeks ago constellation moved from a 16% position to proposing a 38% position for about $5 billion canadian that rerated my stock traded down for two days before that announcement came out because i wasn't on cnbc because there was no rumor. now, i think what it sponsored is it would be a pretty terrible job to be a ceo of a beer or spirits company and not have a cannabis strategy. it is a disruptive ingredient that either you're going to harness or succeed with and i

think what constellation has realized working with us, or you're going to have to react quite quickly which is what's happening now or you're going to miss it so it's going to be quite binary for the players. >> do you think there is room for a lot of cannabis companies, or do you think this is a situation where one or two really rise to the top and take control? >> i think it's like every sector when i need to find information, i tend to use google when i think about web services, i use amazon we're a cloud-first type company. there's going to be a dominant leading company and we are not that yet we are very dissatisfied and hard pressed trying to make things better every day but maybe that mentality has gotten us to a spot where we're getting a little ahead of the pack the constellation cash coming in is really like rocket fuel because we hear about in the prior episodes of your show nafta and think north american because we're neighbors, canopy operates in 11 countries we operate where it's federally lawful regrettably that's not currently the state yet in the u.s

but i think sometime maybe soon state rights will prevail or hemp acts will move in and then we can step into those opportunities having spent quite a few years building quite large-scale intellectual property platforms that are materially different than anything you're seeing anywhere else in the world. >> just to back that up, meaning you won't deal with the united states until it's legal in the country as a whole or until states' rights is made legal you don't want to get in the mess of individual states allowing it and others not >> we have a bunch of check boxes. do i like being on the new york stock exchange absolutely great governance in fact part of the thing that helps us exit prohibition are strong rules so what we would enter is if it became -- if it was either federally legal, which i think on a national basis is unlikely in the short term, or if it became state-by-state decriminalized so we could enter. but a key thing for us is we

have tried to lead the process of exiting prohibition so that we can be very disruptive to pharmaceutical, because there are a lot of ingredients that have not been harnessed under the last 95 years of prohibition, and very disruptive to beverage alcohol because this is another alternate to mood modification so the reason constellation and us have been working together for two years, i think they have been very entrepreneurial and forward looking. what they wanted to do was lead the segment rather than live in fear what we're observing is a lot of the other package goods guys, they're reacting pretty aggressive lly a little late. >> i asked another pot ceo the other day this question and it was kind of tongue in cheek but it's a serious question. which is your favorite one of your products? i ask this as somebody -- look, do you use your products do you use any of these things recreationally >> so in canada until october 17th it is a purely medical regime unfortunately, i'm in very good

health so i have not been a customer of my own product it's been a very important delineation. when i go to see the capital markets, i've done 14 rounds of finance, we have over a billion four of tangible assets. if i was representing any other kind of medical products company, if it was a pharmaceutical, if i said this stuff is great and you should try some, that would be reviewed and considered as very odd so what i've tried to do in the way we've operated is if you need it for medical, we should pursue that for you and we should pursue clinical trials to confirm it's medical but i'm not a patient. but october 17th when it's federally lawful, state lawful and i can buy it, i'm for sure at the front of the line because i think it is probably a more responsible option for mood modification for some people and i don't know if the camera shows it, but i have no problem finding enough calories every day and some of the beverages we're going to roll out are going to be calorie-free but create a sense of positive giddiness. today is my birthday at age 52.

>> i know, happy birthday! >> i would like to have a beverage that didn't get me a little fatter but is a bit of fun. i think canada will lead that. >> we know in colorado when pot was legalized there, taco bell sales went up. >> we occupy what used to be hershey factory. i think you're going to see there will be fun stuff but i think you'll see a format of regulation in canada that gets adopted globally for both medical. then as canada, we're like your boring northern neighbor can you imagine on a national basis we're organizing a method by which people can buy cannabis legally. the rest of the world comes here and watches and says i want to be more like canada. >> bruce, well played, good answers. happy birthday we appreciate your time today. bruce linton from canopy growth. >> i think bruce is wasted no, i'm kidding, bruce that was a joke. i know you didn't inhale

>> no, she asked if i ever bought the stuff. >> no, i asked what your favorite product was. >> i don't think i've exhaled, i don't know about inhaled thanks for playing along i'm glad he was still here to laugh at that because i was -- he was totally baked coming up, one of starbucks' most popular drinks is getting a makeover the details when "squawk box" comes righbat ck

♪ >> at least no former presidents ever -- well, good morning the other one was not important. welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square among the stories front and center, former enron ceo jeffrey skilling is back in the news he's been moved from an alabama prison to a halfway house. back in 2006 he was convicted on 19 counts of conspiracy and securities fraud and sentenced to 24 years in jail. the sentence was later reduced

to 14 years. european union jean claude juncker says if the u.s. imposes tariffs on imported vehicles, the eu will do the same. in an interview in germany this morning, he said that the eu would not let other countries determine its -- >> can we slow down on this. president trump said he would love to end all tariffs. the problem here is the issue with the trucks? i'm still not following exactly what happened. they offered to roll back on cars and not trucks? >> the eu is calling the president's bluff on this. >> is it that? i don't understand the details. >> we have a 25% tariffs on light trucks and we had them since the early 1960s, i believe, and it's helped create a dominant light truck business in america it's a big business for the autos. europe has a 10%, i believe, import tariff on u.s. cars. >> take them all down. >> yeah. >> make them that offer.

amazon shares are higher in premarket trading, been up for the past five trading days gaining 5.3% over that time. where's the trading -- definitely headed below 1,000. at any moment, definitely headed back down. you know what i'm talking about? amazon is moving closer to becoming the second company after apple to achieve a $1 trillion market value. that would happen if the stock price reaches $2,050.27. >> spitting distance. >> very close. making headlines, starbucks is revamping the recipe of its popular frappuccino. the main goal is to reduce the drink's high sugar level while keeping the sweet taste that fans expect. starbucks tested dozens of types of cream, 70 different flavorings and created a new bottle so the right amount of flavors make it into the drink. >> what does a new bottle have

to do? does that read smaller bottles >> anything called a frappuccino i can guarantee you, it's not on my list of acceptable -- i eat a lot of eggs. the weight watchers lady told me it was a zero. you tell me something is a zero -- >> you can have all you want eat all you want, we'll make more. >> although the thing that i have the most of that i just totally overdo, moderation >> too much moderation. >> no, there can't be too much you can totally overdo moderation. >> too much of everything is just enough. >> we play for -- >> we used to play for silver. you know your friend clive davis, they said we used to play for silver, now we play for clive. >> how many times have you been seen him >> over 100. >> we just had a pot guy on. so we'll exchange numbers. >> they have nothing to do with

me >> all right, that's your story and ayou're sticking to it. could the federal reserve be the source of new volatility next year? steve liesman -- >> oh, he's here. >> takes a look at the fed and how the market is already reacting. >> becky, this comes from something you said yesterday i will remind you in a second. jerome powell announced in june that the fed would go to press conferences every meeting instead of just quarterly beginning in 2019. that's already having an impact on the fed funds futures markets. take a look here look on the left side of your screen, four bars. you can tell on the left side which meetings have press conferences and which don't. the ones with the higher rates now look to the right. it was becky's remark about the may percentage that caused me to do this. >> i still don't remember what i said yesterday. >> you said it's so high relative to june part of the reason was because they're debating does it happen in may and june. before they wouldn't have thought about it because it would have to happen in june because that's when the quarterly -- you can see the

probabilities now are distributed throughout the months and that's going to be true as you head further into 2019 so every month now -- >> and that's actually surprising because the markets instant analysis when we heard from jay powell last week, it sounded more dovish than they had going into that. >> what all this means for investors, you have to be on your toes for a possible hike at every meeting instead of just quarterly. the fed has always said every meeting is live but they only raise at the quarterly meetings when they also change their forecasts. this is going to require greater scrutiny of every fed speech and interview and every piece of economic data and that's going to be especially true next year as they have a wide range of views over where to set rates. from 1.9 to 3.625. that's the range for just 2019 you have eight members above 3% and seven are below. there's the trajectory, you can see 2.1, 2.9, 3.4 and 2.9% in

the long run this won't mean higher or lower rates but could mean more probability in predicting the fed. investors will have to be on their toes and traders will be probably going to cheer because when i talked to them yesterday. they said will this remove volatility they said i hope so. >> what other tools could they use? it's not only on the front end it's also letting bonds run off. >> yeah, i don't think they're -- everybody keeps talking about the fed changing their balance sheet strategy i don't think they're going to change it. i remember when i asked i think it was powell, it could have been yellen. i sort of said, well, if the world blows up are you going to change the balance sheet they said not before we get down to zero on rates so i don't think they're going to change that unless they have a strategy on this i think powell, what he wants to do is be more transparent. i think that transparency could possibly pay a price with a little more volatility.

>> you know who's here >> who. >> super brad. a world known tennis coach he's also a big-time investor, so get your pen and paper out because he's going to give you some -- they're probably all four-letter stocks knowing this guy. he's in the house. he's in the house. you were coaching the last american to win a grand slam. >> that was back in the day. >> 13 years ago, wasn't it >> 15. >> 15 years ago. >> i aoslmt had hair. >> remember i was there? i was there the day before tonight i'm going. becaus re, you can choose any car in the aisle, even if it's a better car class than the one you reserved. so no matter what, you're guaranteed to have a perfect drive. [laughter] (vo) go national. go like a pro. see what i did there?

welcome back, everybody. we've got a lot to talk about today. brad gilbert on winning on the court and off. he's our special guest when "squawk box" comes right back. are you done yet?

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the u.s. open is in full swing this week. joining us now is brad gilbert, former pro tennis player and coach, now an espn analyst you had a pretty good career you got -- a better coach, i think. we will remember you as a coach. >> the older you get, the better you used to be i had a good run listen, i'm 57, so 38 straight years i've got to play, coach. now they pay me to talk about tennis i'd do it for free so it's been a good run. listen, i'm a lifer. >> andre was like 800th in the world. you've got him back to winning majors again do you remember that >> let's let the truth get in the way of a good story. when i started coaching him in '94 he was ranked 28 in the world. i was ranked 22. a year to the day he went to 1 and then i kind of laid my racket down. i never retired but i just

stopped. >> roddick won the last major. the last time an american won the grand slam -- >> 2003. yesterday was his 36th birthday. then i had murray afterwards my daughter says that i'm not capable of coaching somebody that doesn't have a first name that begins with "a. >> i was there roddick beat albandian. we were together for that. i got so nervous being next to you watching -- >> and what about me, was i nervous? >> i got nervous watching you. remember, you used to -- with andre you'd go, come on rock, come on rock, come on rock. >> when a player looks over you, you see a lot of coaches and they're going nuts i'm going to keep it together. you might be churning inside -- >> i could tell, though, because it was torture. >> i would tell you you need a little kit in your game. keep it together, keep it together, act like you belong. >> i try to do that here sometimes i'm successful so in all of sports i was saying

that serena and venus, while they're still playing, we need to make hay while the sun shines we need to appreciate what we're watching because it's not likely to be repeated ever. >> first of all, what's amazing is taulk about longevity they first played 20 years ago it's fairly amazing, they have only actually played 30 times. so tonight they're playing in the third round. you will be out there. >> i will. >> and hopefully it will be an amazing evening. it's always sometimes a little uncomfortable watching a sister versus a sister. >> who do you root for and what are their parents thinking i remember the first time they played. >> you just hope it's a great match. and it's one of those things the crowd is not sure who to root for, but you just hope that it's a really good match. obviously serena coming back after maternity leave, venus at 38 it's amazing where they are. still after all this time. i saw venus play for the first

time, believe it or not, when she turned pro when she was 14. >> wow. >> in 1994 that's how long she's been around for and it's incredible the run that they have had. so whether we'll finally -- it's broke. we've had some oppressively hot weather the first four days of the open we had a rule change in the men's on the fly because the women have a ten-minute heat rule so we complained, why don't the men have it? so we had a ten-minute heat rule. >> and joker came back with a vengeance. >> when he was dead in the water. we've had the controversy of a woman, alize cornet, she was so disheveled after her ten minute -- the heat time, comes back she had her top on backwards so she turns on the first point, turns around, takes her top off. she had a sports bra underneath. turns it around and then gets a code of conduct violation. >> that was ridiculous. >> we had yesterday, first time

i've ever seen anything like this, the umpire, mohammed lahani literally talked kyrgios off the cliff. he woke him up, turned him around and he ended up winning that match. >> set up for a great match against federer. >> so that was a huge controversy. umpire, could he call a coaching violation on himself >> right, right. that was something too what about someone got mad that andy murray got mad. do you know anything about that? >> of course i do. on the ten-minute heat time-out, you get to go in your locker room djokovic said he sat in the ice bath for five minutes, which is outrageous, i can't believe he did that so murray -- when you go in, there's no coaching and there's no contact with your team. so you're basically -- whether or not you shower or whatever you do, the official is supposed to be watching you at all times to make sure maybe you're not checking your cell phone

we've got modern technology now. so murray claims that when he comes on the court, i'm sitting courtside, he immediately went to the umpire and said that vernasco had made contact with his team i'm thinking to myself if that did happen, where was the official in the locker room not watching that's like you not having eyes. >> djokovic said that he was naked with the guy next to him naked the whole time too maybe the umps took their eyes off of them. >> that's a little too much information. djokovic saying he sat in the ice bath five minutes. my intel is maybe it was 15 seconds. five minutes >> you know, you always say you never get to talk because you're a huge trader. >> i'm a grinder i trade every day. >> cramer sometimes retweets some of your stuff. >> i get a little frustrated how political we get in the morning and i want us to focus much more on stocks. now we have so much going on in

news for the home gamers literally something can happen, especially from a tweet, something that can happen that massively affects us traders every day. >> you should out yourself a little bit more. you're not -- you're not in the normal mainstream media on what you think about think about pols nowadays don't pretend you're there. >> no, honest to god. >> my dad. >> there's some good things happening in the country right now economically. >> there are doesn't that affect what happens with the stocks. you think the new highs come out of thin air. 3% gdp comes out of thin air. >> what are your stocks. >> last year when i was here i was all about go daddy the thing has been absolute beast. it's a little engine that just keeps churning it's been an incredible run for three years. just reupping. the other stock i was really big on morgan stanley. had a great run on it. your guy told me to like on tv when i was in europe the only

bank stock not going to get hit of brexit, morgan stanley. i buy it had a great two year run with it in australia, morgan stanley ceo is in aussie comes out and makes a statement that like how down he is on the market the guidance and everything. i'm like, okay i'm investing in this thing. i immediately hit the sell button i have small positions in amazon and sales force. take everything i got. go into amazon, and, you know, what, i'm going to go even more. double down on amazon and sales force. so he saved me they're down about 15% from that point in january. and amazon is up about 70% sale force is up 50% i wish i would have gotten rid of every bank stock. the banks are in the -- i can't say the word. >> this should be your day job not that. >> i get so frustrated by okay you're the ceo you're telling me that like

yeah, you're out. >> who is going to win, nadal or joker. we've got five second. >> 87% chance of one of the big three in the mens. serena opened now. halep out in that section. the bottom out i think there's an opportunity for williams like wimbledon, women's draw blew up. expect it to blow up again hopefully one of the williams makes a run to the final week. it would be awesome. >> fusoc on stocks in the morning. less politics. hawaii is the first state in the u.s. to have 100% renewable energy goal. we're a very small electric utility. but, if we don't make this move

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synchrony. what are you working forward to? ♪ ♪ millennials love their pets so much so they are putting their furry friends needs at front when buying a home. >> saw it first in urban rental buildings. all catering to millennials. now buying homes and a shocking number of them making decisions based on their pets. >> sold her condo and bought a house for her dog lucy. >> i loved living downtown

it was great very convenient. the one thing missing was my dog's happiness. >> she is far from alone 73% of millennials currently own a pet according to american pet product association. that's more than any other demograph demographic. and whopping 89% of millennials who bought homes own a pet according to realtor.com that has millennials putting pet's needs front and center in front of real estate decisions 79% of pet owners said they would pass up otherwise perfect home if it didn't meet the needs of pet according to realtor.com survey. >> jessica sunk $12,000 into her new home for her dog and cat a new fence. pet door and renovated the basement bathroom for the dog. millennials want outdoor space or want to be close to a dog park and want to be near pet friendly restaurants and pet product

stores a lot of decisions going into the pets and the houses. guys >> all right. diana. thank you for that and thank to you for spending the hour with us and make sure, becky, i will see you. have a good weekend. everybody else >> good friday morning welcome to sidewalk on the street i'm here with david faber. final day of august, it's been a good month for the bulls futures had the losses today u.s. canada trade talks come down to the wire france down a full 10% get to chicago in an hour. begins this morning with stocks strapping amid trade