everyone is saying this could be a monster, guys. >> the calm before the storm, jackie and a beautiful where you are right now. thank you. we'll take one more quick look at the markets which are all in red all morning. you can see down 91 now on the dow. make sure you join us tomorrow "squawk on the street" is coming up next. good tuesday morning, welcome to "squawk on the street," i am carl quintanilla with jim cramer, david faber is off today. as we watch the 17th anniversary today and hurricane florence some elevations in yields of the highest yields in july our road map is going to begin with trade fears as the u.s. and canada resume talks in

washington and mandatory evacuations are underway as florence barrels down on the coast. dalio is speaking out on "squawk box" this morning saying now is the time for investors playing defense. >> right now whatever that's more defensive, i would be in a defensive posture, whatever your allegation is, you know what your strategic mix is, i would be less aggressive rather than more aggressive. >> pretty fascinating discussion with dalio today we are in the 7th inning and the next debt whatever is going to be harder to handle because these social and political problems will be severe. i think that it is hard for me to talk about what it might means for the fabric of our country and a lot of

conversations are heavy today. they're not in sync. they are in sync with 9/11 i could trump ray and say -- no one would criticize me because it went longer i am not by any means criticizing those who are skeptical. i am saying that it has been the 7th inning for maybe 50% move and i find that, hedge funds that made a lot of money advisers made a lot of money are always correctly wanting to bring the register because you only need to be rich once. i go to over stock and look, they should be down. i was going over some of the big industrials. the tariffs of 40 or 60

billions the tariffs are going up are they going up because the ma market is wrong. i have never made money that the market is all wrong. there is no percentage in saying that it is early >> yeah. >> interesting and these numbers today indicators, small business sentiment and a record high going back to '73. plans of inventories, best since '05. does it make you feel it is as good as it is going to get or not? >> there is an environmentment wh environmentment -- environment when you go out to the oil patch, what are they most worried about? flaring. you can go up in space and you can see flaring. if they are allow to flare then they make more money everyday this government does something so that somebody makes

more money it is a nice balancing act verses china no one is thinking, i think there is little talk by the 7th inning or let's call them 7th ending when there is a storm, people buy stocks of home depot i can tell you -- i felt like, you they're going to kill us it is a triple b, they're going to kill us well, yeah, one day but i am trying to help people make money. i am not trying to help people lose money or stay in place. i want people to be richer that's my goal and it has been my goal in my life let's make people richer i don't think and i did say get out when it was bad. i got a lot of trouble and got

out when it was bad. i even got reverse credits i don't see these things happen right now. i don't like sercertain things should the marianjuana stock go up >> no. >> do you think the market has priced in 200 billion of chinese goods? >> there is a mass exodus from china by companies making things there. but, china is going to be heard by companies that have more mobility than we thought thailand or vietnam or cambodia or other companies that can't move are the ones that's being hurt the apple accessoriey stores, a lot of people felt yesterday

that it is the day that really hits apple can absorb and the customers don't care the higher price. 7th inning, perpetual. we are not in philadelphia where we are blow torching the ground making it 1st inning look, i can get everybody out right now and feel great about it i like the market much slower. if you are trying to make people wealthy, it is really hard to put them in fixed income or be related to fixed income. is defensive clorox much higher than apple thas t is that the defense? america letting you power with rates going up what's defensive that there is a catch? >> there will be a point. >> two years today whethers the that or -- >> i think we had roving

declined that have been hazardous. there are areas of the markets that are elevated. i talked about the cloud king. a lot of people are excited because it goes up all the time. i am excited because it is turning their business should the stock be at 30? i have no idea i don't want to look at this till ray or whatever amg is going up a huge amount. is it the right price? i don't know that's a good sample maybe the hottest stock in the market is it the right price to buy it? >> maybe not it should not be snap either >> we'll talk more of both of those names and amd for sure of the biggest gainer of the year on the s&p surpassing netflix.

>> let me give you one that i thought is crazy i have been recommending innovative technology. they make certain charging platforms for apple. when the stocks got to 35, i got to be careful. it gets a big bid tonight. the chinese and the stocks this is a japanese bid that 7th inning, that turned out to be a home run and a grand slam and i don't care what any oaf it is. if i was thinking 7th inning, i got off the boat and okay, miss the rain >> we kacan't wait to hear what lisa su says to you tonight. >> this is a remarkable multi year term. dr. su refuses to take the bait. >> that's true >> i will insist that she takes

it >> jim mentions the hurricane today and mandatory evacuations are underway this morning for wa parts o f three east coast states the region is bracing for the most catastrophic storms to hit in decades it is expected to get stronger today and make land fall on thursday that was hurricane hazel back in 1954 jim, comparisons are being made to hugo in '89 some of these damaging estimates are 15 or 20 or $25 billion >> let's hope everybody evacuates. >> and the california fires, a lot of people, you know what, the other guys can get hurt. people are evacuating because it could be you when we talk about these kinds

of storms we know that insurance rates go up and again people just say the dollar sign represents -- these cat storms have not been one for a long time when you have one, the insurance companies do raise it. >> you can't ignore to what happened to home depot shares yet. although people are getting generators and home builder supplies and ensurers. >> these are the gender xr short term >> i think they're still there, travelers. should these trades happen home depot is a cheap stock with or without >> we'll get a live report from the hurricane site that we expect to see later on this week when we come back, tesla is getting a downgrade just hours after another tweet of elon musk

this time about paint colors we'll have live coverage of some of the remembrances of this 9/11 and including a moment of silence here this morning. more "squawk on the street" at post nine here in a moment need a change of scenery?

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long time bulls on tesla tesla is quote in need of a better leadership. nomura is quote moving to the sidelines. tesla announced this morning, moving two of seven tesla colors off menu on wednesday to simplify manufacturing >> the issue is the erratic behavior of ceo elon musk. this is best expressed of the number of tweets per day which increased 15 per day since may four per day previously.

>> put that in your model. >> tweets were day is a new one. jesus, what's the president's tweets per day just putting it out there. joe rogan's podcast. these are signs of a couple of interviews that jim stewart gave that perhaps there are something right. i know that this behavior and i like the word he chooses is erratic because erratic is not so damming erratic behavior of a man who head as company that's so uniquely to him is not something you want to have happen. >> you were even as recent as last week we are saying this is not the behavior of someone who should be running. >> medical leave is fine i think the board puts him on medical leave. that's not a sin it is just -- it could be a good

thing. i am worried about the guy i am really am this is behavior and self destructive behavior that he's exhibiting it is so obvious to the physiatrist community. no one cares because he's a gener genius but even genius should be protected. >> ideas for executives for this company. >> in terms of calming things down obviously a great beard would be good to have i think that -- honestly, it is no sin to admit that the erratic behavior should be cool or maybe some time off. forget the next three months for the model three. let's get this guy healthy a healthy elon musk gives a musk the clock is ticking as some of

their rivals starting to put products on the deck well, the germans are there. i think i have been in their bmw. >> geez, that's a fantastic car. >> when we come back, remembering of 9/11, don't go away see that's funny, i thought you traded options. i'm not really a wall street guy. what's the hesitation? eh, it just feels too complicated, you know? well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman? hey, ian. you know, at td ameritrade, we can walk you

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attacks. the president and the first lady have arrived jim, you have done some work on the event and the building that took place in 17 years ago >> a lot was good and a place that was sad >> here ace moment is a moment . here is a moment of silence.

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u.s. bank - the power of possible. you are watching "squawk on the street" live from the capital of the world just about six minutes on this busy tuesday of course, we remember the 9/11 attack and the hurricanes approaching the carolina coasts and evacuations for millions of americans today. nafta, trade talks resume and we'll see where we can get between the u.s. and canada. and reuters are asking the wto if they can pose sanctions on us relating to dumping duties >> canada is problematic

i know they'll keep on trying. china is not as problematic because that's a desperate act china should not be apart of it. it is one of the things where i think is a cripple thing that china still has a favorite nation status as being what we call a less developing country that's kind of silly if that's all that china can mu mu muster, maybe they're out of bullets. if you tax everything then i think people are going to buy things from other country and if we decide in power and toys and knickknacks or whatever, we don't want them made in china. those plays are just beloved we always hear it forever how strong the chinese are you read this weekend how the chinese are attacking the muslim

province as if it is revolution that it can happen in a minute that's not the majority obviously. the endless parade are smart people saying china is invincible is starting to lose its muster >> they're ready for the midterm and the president's focus on domestic politics to go up dalio think of china as family where they do what's right and we have electoral college focus here >> the socio logical nature and what we are doing is leaving me cold the fact is if we put the tariffs on what they bring in here, it could shift things that are made in other places it should be down. >> look at company stocks that were roaring yesterday they're the ones that's dealing with china >> what about apple?

apple is down four days. vfa says prices going up 20% of the iphones. what does it do to the replacement cycle? i think apple is subsidized. apple is a surprise to me. the fact that apple is not down 20 the air pods are so important and some of the watches are important and we have a new watch coming to ing tomorrow apple is not down enough because we get pieces like this morning of a very positive piece about apple that says hey, do not worry about a thing because one and six phones are apple three new phones are coming and new watch and air pods and 220 million phones were sold in 2018 none of these seem to add up when china goes after yum china.

there was a bid for yum china and they walk ed away. they're going to fedex, when is it happening it has not hit home yet? is it us whistling past the graveyard? we don't s muhave much that chia buys >> china is vulnerable you think the market will react better to a tariff agreement an auto in europe >> yes, we do need that. we would like to see something nailing down china is an issue of a game of chicken. >> yeah. >> i keep on thinking what happens if the midterms go trump's way. what's the president for life new plan remember when everyone was all

in and we had a really difficult period which the chinese stock market it could happen again. why are we talking about that? maybe they're in the 9th inning. i don't know >> at some point it is going to matter for us or the fact of the best per fformance european ind in this company. the money comes here i want to know what all the nay sayers are saying of the fact that our markets are up big and everyone else is doing badly europe is down and europe closes, we rally there is something going on in this country you talked about the small business and the level of really -- i would say the level of not complacency >> remember it will absolutely hurt us. it is used for cap ex. it is used to raise the wages.

that's the story that no one wants to tell because i think of ideology it reflects well on our argument >> the argument yesterday that this administration have unleash an investment boom we'll see if productivity is the real deal. >> if you are a democratic, it is not a boom and if you are a republican, it is a boom i don't know >> our guys voted all sorts of way. i would not say a boom -- a name is a boom. >> the opening bell, s&p is at the bottom of your screen. the big board this morning, glenn winnick and an organization day and remembering 9/11 it is tuesday children, helping those impacted by 9/11 it is an important day to keep charities in mind.

they lost 680 people that day and they take all of their profits on this day and give it to 150 charities we'll hear more from them. >> anybody does anything, i salute them. it should be like a public day of service like martin luther king some people are e-mailing me particularly affected this year. through 22 years younger, it is likely that you don't know >> of course >> i remember growing up my father would talk about how the rate on the radio, he volunteered on september 8th you want people to recognize that's a day that. it is hard to remember for younger people >> especially the older we get, the more we find ourselves explaining that day to others. >> yes that's it. let me tell you what happened

that day >> no. everyone has to know what happened that day. >> exactly >> getting back to what we normally do at this hour taking a look at some names. fascinating piece in the journal regarding nxp as they initiate in dividend programs and embarking on a strategy today. >> yes, nxp is very interesting. what are they really involved in auto that was their dominant theme. auto went from positive to negative they're pretty good at communications i know they can develop a policy for something for autonomous driving. you know what if it is autos, it is just bad. it is bad whether you like it or not and there is a long-term thesis that people don't buy cars the way they used to be i have a lot of friends who say

they're out west and the parking lots are empty the parking lots are empty >> they are to repurpose a lot of land, jim >> it is real because the millennials. now, millennials, pchlt o one of these that they point out. the millennials are buying homes and the millennials do these things that we forget what they do, they have capital and they're moving out of their parent places. they don't buy cars the way they used to. pick up truck is a sign of a small business that's what you do >> and hence the value it is placed on 150 over add ford. >> i think that's just -- there is a good example. boarding up places in south carolina and north carolina, go by home depot.

these are things that used to happen in the '80s it is how the market rs rally. common sense thing went up they got enthusiastic. that's why when i hear the 7th inning, what happens when it really happened before >> that's the thesis that kudlow has been trying to tell us >> larry and i went back and forth. he's a free trader and i was someone who favored heavy tariffs. the tariffs we are getting are not heavy yet. yet. >> good point. >> a lot of the action and winners are spunned by upgrades. nike which i know you have seen. dri and snap gets upped. >> snap is horrible of its timely nike, you look at the whole

divide kaepernick sign of strengths and nike asked in provacative way. nike is doing much better since kaepernick and maybe nike knows more than we do about selling sneakers people trying to figure out whether mark parker is dumb but he's a genius when it comes to shoes. i would argue that mike has more knowledge. there is a lot of upgrades and amazon note today talking about the pill packs and how big it is going to be. amazon acts terrible because it has been down for four days. we are really spoiled? >> it is off 120 bucks. >> we had a downgraded darden yesterday. where was everybody at 80 or 90

when olive garden were making turn that's something that's new. in this bull market, people say oh, i have not missed a thing and i am recommending its highs and i don't care or they'll say nike of this kaepernick break. what an opportunity. >> nike, nfl ratings >> yes, whether it is fox or sunday night football on nbc was one of the best primetime shows in several mathew knoonths. it is not down >> my theory is this is the year and helped by major markets that do well. did you notice that everybody in the city is a jets fare jets fa? >> yes >> the initial play was rough. >> kind of a wake up call but then everybody -- >> people are spelling the word jet. most of them cannot remember how

to spell it. >> getz. >> speaking of sports and media, it does take us to cbs they see uncertainty from the company's transition and management and limiting upside for an extended period they say after moonves resigned on sunday night as the ceo they have a big tick tock on january. >> so optimum of the way they handle that. >> i am not reading any more of this at one point i said something positive of les and how he dealt with this. that's great, you are a guy. by the way, she says i never want to hear another word about him in this house, ever. i want him to always be

disgraced. i want him to be the disgraced les moonves. okay okay >> and then we had discussions yesterday with faber on the phone of the take over target of what this truce between the two boards mean. >> i think viacom should buy them viacom is doing incredibly well. those of us who are gripped and binged on "jack ryan." the idea that the viacom people don't know what the heck they are doing, the number defines that viacom should buy cbs, it is a nice combo >> that's right. >> one of these is happening everything that people say about this that's never going to happen happens les moonves. >> you don't think the two-year

window is solid? >> they all write the rules and it is -- they can say whatever they want and suddenly they find something else is cbs attractive? it is such a small piece of paper. i am sure it is attractive to somebody >> compares to other assets that's been on the market >> the much revere/disgraced moonves did not create much value as people would like to think. there was a period where he created shows, "csi" and everything there is the kind of a sense that his time has come and gone, he was 68. wow. >> i will be curious to know jim tonight as you talked to lisa su of what you made of the overall action of semis which are having a tough day once again >> which was unbelievable. >> the problem has been whether anyone can have mergers now. there is a downgraded western

digital by rbc which talks about -- but, also talking about how d ramps are going to roll over this is not where lisa su and amd are. it is not where nvidia is. the index is rolling over big time look, this is the group that's most vulnerable because the biggest surprising for d ram and flash are indicators of what happens and people rather be in cyber security and rather be in companies that are selling to the cloud. and d ram and micron are not as cloud d. jesus, that's a good company nobody cares >> about 4% down >> micron is just -- western

digitals are $9. >> i notice that nvidia is unchanged. nvidia is part of the data center gaming has red hot as ever and artificial intelligence and machine learning these are areas that when we read a lot of virtue reality in the new apple phone. you got to think about how much of that is nvidia. a lot of people want to say i want to sell nvidia and buy micr micron i don't think lisa su will say that >> 20% declined today and below 17 on a quarter that relative to ex peck tags to-- expectations t

took people by surprise with sonos. >> one of the most inconsistent companies in a long time and they proved to be inconsistent >> it hurts them today dow is down. let's check in bob pisani. >> this tariff story is the larger movers of the mark. this is the dominance. take a look at the sector again today. everyday i put up chinese internet stocks are down again and metal stocks like the xme are down today industrials and your 3 m's and united technology are weak today. semiconductor jim was talking about is down here and amd had a story out how amd was gaining in certain sectors of the market.

amd is generally fwllat and micn is notably to the downside today. >> bob, forgive us we go to shanksville where the president and if first lady have just arrived they'll read names in 15 or 20 minutes and have remarks just be aware that the arrival have taken place bob, sorry, back to you. >> of course, we are watching president there. it is an important thing here that this trade war issue is heating up sanctions against officials because of possible abuses and human rights abuses in china they're asking chinese, the wto for permission to impose sanctions in washington. this is not going away thst n you can see autostocks in europe

and bank stocks and insurance stocks are all hitting new lows. we got some chinese stocks at 52 week lows like ten cents and alibaba and jd.com is there. put up some of the european financial stocks earlier some of the big private banks, these danish banks are all sitting at 52-week lows. this has been going on for several weeks and the market is eroding. metal stocks glenn core, the big metal company over in europe is at a 52 week lows today number one is china and tariffs of market movers the dollar has been an issue a month or so ago but it is

quieter. tech leadership let's say it is down but not yet out let's call that undecided right now and if fed and the rate hikes, it is not disrupt activity yivedisruptiveyet i want to show you the s&p 500 again. we do this all the time comparing the u.s. market this year and comparing to other markets. the orange line at the stock of 600. europe here is simple. u.s. is up 8% and europe is down about 5% that out performance started in may and june and that's when these tariff issues started to heat up. it is true and we have been out performing in terms of earnings all year over europe so there should be a small out performance. it really changed dramatically when the tariffs issue came in dow is down 75 points and it is most of those big industrial

names. we'll get to the bond report as well. >> good morning rick santelli. >> all maturity is up about two basis points we continue to stretch the activity that started with some good numbers on friday on the employment report. we settle at 293 and traded up closer to 2% and right now we are under 296. may 5th start to tens. we'll dabble with something that's allusive and we only had a dozen closes at 3% or higher for 2018 we know central bank meetings are coming up to european, two central bank meetings and the bank of england exactly at two weeks today. the short ends are heating up a little bit look at the european two years

i know that does not sound like high yield but you see the yield to date chart. the highest child all year is minus 49.5 basis point, we are getting very close have you look at what's going on in the u.k. the two-year starting in july in these are the highest yield hovering just under 80 basis points and everyone the ten-year is getting into the mix in the u.k. hovering around 160 basis points this is the loftiest closest since early may. 95 area seems to be where we are trading and we circumvent that area it does not seem that some of the short waves in europe ak accentuating any move movebig m. >> carl and jim. back to you.

>> micron is the biggest lagger and dow is down and the s&p at 28.73. we'll be back in just a moment i think that she's a very nice girl...

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welcome back jim has crm on his mind. why? >> you go after the digitals regarded as being commodity and go right back to the proprietary stocks that means they have, regardless of what's happening, you see sales force and adobe go up. these are what i call -- the companies that are on board to the cloud. and you do tend to see these when you see hardware go down. that's what's happening. it's a rotation. i keep emphasizing to the seventh inning-ers, that's what's going on. >> is this a split between

consumer enterprise? is that what's going on here >> perhaps at the same time we're seeing companies that are short because of chinese -- let's just say they thought they had a lot of chinese goods and there the emphasis -- you have to look at five below people are short that because these trinkets are made in china. that's been a terrible short and xpi has been a good short. qualcomm being a bit of a mix. i'm looking at the semis and trying not to generallyize because they have created great fallacies. the seventh inning is good for some and not for others. this whole market has been nonsweeping. workday allegedly reported a weak quarter last week that stock will take out a tie why? it wasn't a weak quarter. >> it is a rainbow even though we tend to talk about it -- >> i'm stuck trying to figure

out what to say tonight. you know, i think that the answer is you've xwot to commemorate but you have to help people make money. you just have to it's what i do for a living. it's just what i do. >> keep working on that. when we get trading with jim in a moment don't go away.

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this move into software, including gaming software. steep upgrade. talking about the overwatch league i think people should recognize there's a gaming business that is so strong and, by the way, from advanced muk rows right at the heart of it. and i think she's one of the most important people from tech. one of the most important people in tech. >> that's a show right there between su and toll. >> rick clemmer on his own and it's a very good company. >> jim, i'll be watching tonight. >> yeah, wow kind of a tough day. >> it always is. mad money, 6:00 p.m. eastern time tonight when we come bk,ac dow erasing its losses a bit down 32

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street." i'm carl quintanilla along with courtney reagan and mike santoli at the new york stock exchange it is the anniversary of the 9/11 attacks always a difficult day we'll keep an eye on remembra e remembrances at shanksville, here in new york city and at the pentagon we have data across the tape and with that, we go to rick santelli rick >> for july's final read up .6 that's darn close to expectations and replaces the mid month read up .7 on the wholesale trade sales number on chains, sequentially falling .2 as for jolts, yes, another 600 matter of fact, almost seven 6.935 million job openings 12 out of the last 14 jolt numbers have been over 6 million. seven in a row now over 6 million and prior to june of

last year, actually april of last year, we never had a 6 million number going back to the beginning of this series this particular number is another new high 6.8 million in april so, anything related to jobs just keeps going higher and higher and, finally, the market's response, getting ever so close to 3% now, 2.5 bases points away on the ten-year. carl, back to you. >> wow, rick, thank you very much rick santelli. our road maps begin with trade talks resuming in washington today. major averages are falling this morning. >> apple is getting ready for its big unveil look at the tech giant's product pipeline up next. millions up and down the east coast are getting ready to evk wait evacuate as category 4 storm florence heads there we'll take you live. dow still on pace for its third straight negative day.

ray dalio of bridgewater spoke about the markets, cautioning investors to be defensive. >> right now, whatever is more defensive, i would then be in a more defensive posture whatever your strategic asset allocation, you know what your strategic mix is i would be less aggressive rather than more aggressive. >> joining us this morning, jeff klein at charles schwab and director of macro at fidelity investments. good to see you. >> good morning. >> jeff, the jolts number we just got, new high on this quit rate ties right into what we got out of nfib today and maybe what yields are telling us. what do you make of this job market how tight can it get and dwindling numbers of available workers? >> well, it's an interesting question hopefully we'll see productivity

come back. the real key isn't what level of unemployment but where inflation is relative to unemployment. i've talked about this in the past what we've seen is when the unemployment rate and inflation rate are the same number, that shows an overheating economy and usually precedes a recession, peak in the stock market that was true for each of the three last recessions. it's different at which we hit that level each time which unemployment rate. but we're getting close. we're only 1% apart. it's something to keep an eye on. >> this idea that we're kind of on the lookout for peak conditions that perhaps were in the latter phase of a cycle, it seems, to some degree, reflected in the markets there's a bit more of a defensive tone auto markets look past peak. do you think they've figure this had out and, therefore, is the market modestly valued enough to see if we get more length or

strength in this expansion that we have another phase of good returns for stocks >> yes i would agree with that. we've been sort of transitioning between mid and late psycycle f some time and then we got the tax cuts that's labeled it somewhat immune if you will, running at 24% year over year earnings growth the rest of the world is in a different boat which is why the em area is lagging the s&p by 21 percentage points over the past seven months but it's interesting. the economy is running hot what we just found out a few weeks ago from a benchmark revision in the measures for our star or the natural rate of interest is that our star has been revised higher by some 80 bases points, which is about the equivalent of three rate hikes my sense is that the fed, which i thought was neutral at around 2%, is actually quite

accommodative. that feeds into the argument that the economy can continue to run but at the same time the fed probably has more wood to chop than maybe the markets are expecting, and that the entire yield curve needs to get repriced a little bit. >> speaking of that yield curve, jeff, look at the two-year note, currently sitting at highs of the day, kind of at a ten-year high here at these levels, getting ever closer to that yield curve inversion. something we need to see as a warning sign or are conditions different this time around >> no, i don't think they're different this time. i like to look at the ten-year minus the three-month, that g e gives a closer peak in this stock market what's interesting about the yield curve, people debate whether it's as effective as it's been in gauging u.s. economic conditions. it's amazing at how well its timed peaked in international stocks sometimes the exact same day that the emci index peaks ahead

of a 20, 30, 40, 50% bear market we're not there yet but need to pay attention to it. it's a measure of global economic conditions, very important to global companies. >> jurrien, people watching transports after yesterday, that record high, saying the ball is now in your court, mr. industrial how much does that matter? >> you know, it waxes and wanes over time. it's probably not as important as it used to be back in the day. you know, someone taking the contrary view could show a chart of housing stocks and showing like a big divergent so my sense is that we are in that twilight zone between midcycle, the goldilocks phase, and late cycle, which can still be an okay phase for the stock market it's when lick quidity tightens

five hikes it will probably be inverted it's a measure of tightening financial conditions, which is what the rest of the world is already feeling but the u.s. is immune from temporarily because of this huge tax boom. but 2019 will be a very interesting year because by then, earnings growth in the u.s. will be back to trend, at around 8%. the fed will either have to keep pushing higher or it can declare victory. and by then, china may have successfully reflated itself 2019 is shaping up to be a pivotal year but 2018 will be more of the same the u.s. valuation has come way down, about three points since january. but the earnings boom offsetting it has allowed the s&p price index to basically be unchanged on the year and i suspect that will continue. >> it is going to be a fascinating rest of the year and next year for sure jeff, jurrien, thank you guys.

appreciate the time. >> thank you. evacuation of more than 1.5 million people is under way as a category 4 hurricane gets ready to make landfall in the carolinas. jackie deangelis is there in north carolina with the latest. >> reporter: good morning, guys. it's hard to tell such a massive storm is coming here it's beautiful on the beach. some chairs are set up people are still milling around, even though they shouldn't be. the governors of north carolina and south carolina have declared a state of emergency and also evacuations have been issued for a lot of the coastal areas and the reason for that is because this storm is not just going to pack a very powerful punch with winds, but the ocean behind me, the waves, could come up as high into a storm surge of 10 to 20 feet. and so the concern is flooding and massive damage to the infrastructure in these parts of the two states what's interesting to note is that a lot of folks are taking this wait and see approach, even

though they've been advised not to do that at this point the models are showing that this storm is going to be what some are calling a monster. the governor of north carolina has said we are directly here in wilmington in the bulls eye of the storm. some folks making preparations to hunker down we saw a lot of people at the supermarkets, walmarts last night stocking up on supplies. there was very little water to be had pretty much anywhere in town and other people told me, you know, we're just going to get in our car and drive inland already some folkstold me traffic getting out of the coastal towns is starting to get extremely, extremely heavy now there's an impact here, of course, on the residents, on the local community, the businesses as well. i want to talk a little bit broader about some of the market impacts that we could potentially see from this storm. in terms of refineryies, they're really mostly down on the gulf coast. you have some on the east coast but they're a little bit farther north. this storm shouldn't impact

gasoline too much. there may be some delivery issues because of the bad weather but we're not looking at what we saw, for example, last year with hurricane harvey another issue is nuclear power plants about half a dozen of them are in the way of this storm so, that's one aspect that people are certainly watching. and when it comes to stocks, guys, you've been watching the insurance stocks they are moving around very strongly ahead of this as well the flooding damage, the wind damage, the potential for infrastructure damage and power outages is great there's a lot of things to watch over the next couple of days as this storm intensifies and makes its way toward north carolina. >> you're absolutely right, jackie the storm is not here yet but the action and a lot of the stocks that revolve around weather have already made their play in the past couple of days. we'll watch it closely jackie deangelis, covering hurricane florence today apple is getting ready for its next big product reveal

tomorrow a look at what we might expect for the tech giant the dow is up, gone green up 20 points and you're looking at a live shot of shanksville, pennsylvania the president getting ready to speak at the flight 93 9/11 memorial service we'll take you there live as he begins that's the beat of global markets, the rhythm of the world. but to us, it's the pace of tomorrow. with ingenuity, technologies, and markets expertise we create the possible. and when you do that, you don't chase the pace of tomorrow. you set it. nasdaq. rewrite tomorrow.

apple is set to unveil new products at its launch tomorrow morning. customers could expect up to three new iphone models.

an analyst at rbc capital markets and lauren, let's start with you big picture. what can we expect specifically with regards to updates to the iphone, watch and ear pods >> it is widely expected we'll see two new iphones, potentially three new iphones differentiated by price and size. it's widely expected we'll see an apple watch which would be called apple watch series 4, which could have a larger display and possibly more advanced health sensing. we may see a new ipad pro and the wild card is whether we'll see a new entry level mac book. >> i know it's probably a long shot to think that mr. cook will talk about the impact of tariffs on the cost of some of these new apple products, but it was outlined several days ago, so i guess it's a fair question at least to ask what about the profitability of some of these new products is the gross margin going to be lower because of what we

potentially are going to be seeing with the tariff costs >> yeah. i would say without the tariffs, standalone, these products should have higher gross margins. two things, lcd will have a lower so that helps the margin a little bit but memory cost broadly has come down a fair amount that's held gross margins as we go forward now when it comes to tariffs, if and when they do get implemented, apple's historical practice has always been to raise the price to the end consumer over time the question may be if tariffs get implemented, what's the demand that they'll end up having when prices go upso dramatically >> on the stock and how expectations fit into there, it's been common to say that people aren't building up high hopes for this round of product introductions yet the stock is up 30% year to date and

basically now is at a market multiple used to be at a discount for years. to what degree do you think that the stock is positioned to accept either disappointment or pleasant surprise here with these products >> yeah. you know, there's been a bit of dichotomy here where the expectations into an iphone product cycle. stocks working higher. i expect it reflects two things. one is value investors like warren buffett behind the name the second thing has been investors are starting to realize that this is a different apple story, different apple stock than what it used to be and today apple is more about revenues of 5%, 6% really services and other businesses are ramping up. so i think that's what you're seeing more and more credit given to apple surprising upside would be if they give you any more insight into services, monetization and

services growth, especially in the media platform. >> lauren, i wonder, we talk about services a lot sometimes these product launches come with sort of an ancillary partnership with another provider or tie in with disney i wonder if there's any talk about that. >> there has been some talk about that, especially on the entertainment side apple is playing a little bit of catch up there in terms of putting out content that draws people more into its services. at this point it's hard to say i think it's a really excellent point that services are a huge and growing part of apple's business especially at the high end of hardware, the high end of smart phones more and more of the features start to look alike across different smart phone manufacturers. the real differentiator is the kind of services you can offer and also how smart your software is, how you're utilizing ai to make those glass slabs act that much smarter and better. i think that all ties into

apple's broader strategy here. >> lauren there's a lot of focus on the hardware at this big september event, per usual services and software, ios 12 has at least been out in beta form do you think we'll get any more information about when that will be released and what can consumers expect from that >> that's a safe bet typically we hear a little bit about ios 12 and usually apple will release the final version of the software the week that iphone goes on sale. we could be looking at next week that software being released security updates in ios 12, a smarter siri we know siri has kind of a checkered history as it's been out in the market and improvements to things like photos, augmented reality and, once again, machine learning. >> thank you very much appreciate you both joining us to give us the forecast of what we'll see tomorrow amit and lauren, appreciate it. >> thank you. >> thank you. >> all right

when we come back, it's been ten years since the financial crisis inside look on cnbc's special documentary "crisis on wall street: the week that shook the world" is next. major averages, dow up 29 points and nasdaq up about .1% ♪ ♪ our new, hot, fresh breakfast will get you the readiest. (buzzer sound) holiday inn express. be the readiest.

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welcome back to "squawk on the street." tenth anniversary since the financial crisis a special documentary appears tomorrow night at 10:00 p.m., "crisis on wall street: the week that shook the world." andrew sorkin sat down with key players at the time. >> why do you think the lehman piece, though, is still -- people still think of it as a mystery? it still is misunderstood or confused. >> i think it's hard -- people do attribute vast powers to the government, powers we didn't have and most central banks have vastly more powers than the fed has. and most governments are

parliamentary systems where the head of state can legislate powers he doesn't have or she doesn't have in that moment. a lot of people around the world looked at us and said, uh, well, of course you had the authority to do it of course you had those tools and i think that's partly what contributed the expectation, to the trauma that happened afterwards at that point they had two different -- there's two different sources of uncertainty. one was how big were the losses and who was most exposed to those losses, who would not survive those losses that's hard for people to understand they ran from everybody because of that. they also couldn't figure out what could we do to protect them from that? it was hard since we didn't have a crisis like this since the great depression what was the extent of the limits in the fed's authority. >> andrew ross sorkin produced that piece and joins us from 30 rock it looks fantastic. >> thank you. >> i'm curious to know, in your mind, how the answers you got on this documentary differed from the reporting you were doing during the book.

>> you know what perspective. i think people have a sense of perspective about what worked and what didn't. when i was reporting the book, it was 2009. so we had no -- nobody had any idea whether the tarp money would ever get paid back, if qe1, let alone two, three and four, that didn't even exist at the time, were going to work the automobile industry was being bailed out i don't think anyone had any contemplation of where we would be frankly, i would say at that time if you had asked them then if we would be where we are today at 3.9% unemployment and the money paid back and the economy doing as well as it is, despite how uneven it is -- and i recognize that -- i think they wouldn't have believed you. >> and do you think that fact, andrew, means that everyone more or less says, look, history has kind of ratified all of our

responses? are there specific misgivings about how folks went about things >> there's a couple of things. it's to the point that time geitner was referring and we were discussing lehman brothers that remain, to some degree, a debate or mystery, if you will geitner, bernaske say why the fed did not bail out lehman and whether that exacerbated the crisis, by the way there are others in this documentary, by the way, including general counsel of lehman brothers. but another big name in finance. i will tease you with that you need to watch the documentary, who take issue directly with the view from geitner, bernanke and paulson. i think that issue remains for policymakers a big one and then the question is, do we have the tools today if, in

fact, there were another crisis to deal with it? dodd frank was supposed to i will tell you, the more you talk to a lot of people in the room then, they're worried, actually, that the tools make it harder, not easier and that if and when we get to another crisis -- and we will -- that ultimately we won't really roll the dice. we won't take a chance on the way the new rules are set up to let a bank fail. we, in fact, probably will try to step in so perhaps it continues. >> perspective is powerful, as you suggested there earlier, andrew perhaps that's changed a bit since the initial reporting on the crisis by and large, does everyone you spoke to think that we are safer now? you spoke a bit about some of the tools that have been in place in dodd/frank. >> safer, yes, in terms of the traditional run on the bank that we would think of as the financial crisis we had ten years ago.

there's more debt today than there was then the question is, who is holding the bag? are the banks safer? yes. where is it elsewhere in the shadow banking system. one thing we haven't really talked about is the impact on culture, the impact on politics, the impact on trade, this idea of populism. and it's a conversation i had with ray dalio on "squawk box," which are always a function of debt more than anything else, you go back to the great depression, look what happened afterwards and he would tell you, do you know where it ended? pearl harbor that people looked so inward, that trade became so complicated, that relationships broke down one thing he talked about was the relationship we have with china, for example, right now. we need to look, you know -- we need to look beyond, perhaps, wall street and maybe toward washington but maybe toward our allies and other partners.

>> yeah. kash kari has made similar remarks. baffling on anniversaries like this we allow the regulators, politicians, central bankers from that time and ask them for lessons that need to be learned. is that a legitimate gripe >> you know, i have to say there has been a lot of tomatoes and worse thrown at the people, quote, in the arena, if you will, at the time. it's very difficult to look at what took place the last ten years and not suggest it worked. you could say it didn't work as well as you might have wanted or it was slower. but i'm not sure the alternative -- by the way, the alternative is -- we had a natural experiment, the uk you saw what the uk did. they did all the populous things that you thought some people would have wanted, kicking the bankers out, onerous loans to the banks, restricted spending,

all of it. their economy is clearly no much the better you talk about populism, brexit is probably one of the greatest examples of that so it's not clear to me that we can look at this situation and look at it as a failure. i do think there are lessons and i think the history, ultimately, will look at those policies and policymakers at the time fondly. though, i know that's a very unpopular thing to say. >> yes but we're glad we have you with us to learn the lessons and in the end it does have to be learned in some way from the people who were actually there andrew, thank you for that tune in tomorrow at 10:00 p.m. eastern time and pacific it's called "crisis on wall street: the week that shook the world. you do not want to miss it. >> staying with the financial crisis and regulatory response, faced with another catastrophe today, would the central bank use the same tools and would they be able to?

steve liesman joins us with that story. >> ten years later, they say, they would mostly do it all over again. fed and treasury officials say faced with the same kind of facts, another lehman crisis, financial crisis, they largely say they would respond to the crisis as they did before we get on to some of the caveats of how they would do it differently, let's look what they did interest rates down to 0 they did quantitative easing, 1.75 trillion, with a t, in the first go round the economy still didn't respond. then they did the second round, qe2, another $600 billion in 2010 six years after the crisis, they got done, started 2012 qe3, finished six years later, bringing the balance sheet up to 4.4 trillion if you look here, very carefully, you can see just the beginning of the fed finally beginning to bring down its balance sheet and you would also

see them raising up interest rates. that was not all they did. there was much more. let's go down memory lane here 47 billion, maximum amounts. maiden lane, pdcf, primary dealer credits, all these other programs seems like they came out one day at a time, new program, commercial paper, taf. all these acronyms that were new at the time, innovated programs by the fed to backstop the financial system, half a trillion dollars in currency swaps and twists to trade short term for long-term securities. fed officials believe a much bigger part of their job, regulating the banking system and nonbanking system to make sure it doesn't happen again they mostlily feel that the banking system is better capitalized to withstand a crisis though some want banks to add more capital today if it does happen again, here

are some of the lessons they say they learned first, act early and forcefully. they take that from europe acting later and the u.s. was quicker to get out of it the famous dragi quote, whatever it takes they want greater fiscal policy, want congress to step up next time not everything is agreed ongoing debates ten years later that are still being discussed among economists here. one, negative rates versus qe. the fed decide not to do that. we'll see if europe was smarter to do that treasury only purchases. people say the fed should not have gotten involved in private credit allocations, getting out quicker or exit strategies and the whole big debate, hurting savors versus helping borrowers. overall framework of this debate, how much and how long should a central bank distort a market economy in order to save it back to you. >> steve, great reminder of, really, the almost

improvisational response the alphabet soup you went through right there. people think of it mostly as low rates in qe. >> should we do a quiz now do you remember what taf stands for? i didn't i had to go back and remind myself it was one after another it was a bit like a dyke that was leaking. tens of billions of dollars in a program. paper funding facility, the taf. they had to lend collateral out there, mike. the idea was this. the economy can go up or down as far as the fed is concerned but not because of a panic not because the market is acting irrationally and all that issue, mike, which you remember very well of moral hazard and how much has been created, how much remains to this day is a big question. >> yeah. very difficult to measure,

steve, and difficult to gauge exactly how behaviors changed but good stuff to bring us back there and bring it forward steve liesman, thank you very much >> time now for the etf spotlight. ongoing we canness in chinese internet names take a look at these charts year to date. really profound weakness in the cqqq chinese techstock, etf, chines version of our nasdaq etf. those are the lower two lines right there. pretty significant underperformance this year versus the overall chinese market what's interesting about that is, of course, it seems to be trade related. it seems to be about exports and tech names in china are not really direct hits on that front. however if you look back at a two-year version of this, those chinese internet stocks drove the market over there so much higher and drove all emerging market indexes so much higher. on the internet side they're

essentially giving back that outperformance of last year. over a two-year period they've also outperformed and have been holding up emerging markets. alibaba down 2% on jack ma moving away from the scene a little bit it seems much more about sentiment toward china and capital flows in china as opposed to anybody really saying, hey, this is directly about ten cent and alibaba. >> it's all wrapped up in a big soup although you go along with cramer's world view that it's hurting them more than it is us? >> it's hurting them on a stock market size. if you have any disruption at trade it matters there also happening at a time when you have the dollar going up and rates are going up and a lot of other stuff that's squeezing emerging marks plus the slowdown in china. >> good stuff, mike. live shot here, the

president set to speak at the 9/11 memorial in shanksville in 2017,

california had the worst wildfire season on record. scientists say, our weather is becoming more extreme and we all have to be better prepared. that's why pg&e is adopting new and additional safety precautions to help us monitor and respond to dangerous weather. hi, i'm allison bagley, a meteorologist with pg&e's community wildfire safety program. we're working now, to enhance our weather forecasting capabilities, building a network of new weather stations to identify when and where extreme wildfire conditions may occur, so we can respond faster and better. we're installing cutting edge technology to provide real-time mapping and tracking of weather patterns. and we use this information in partnership with first responders and california's emergency response systems. to learn more about

the community wildfire safety program and how you can help keep your home and community safe, visit pge.com/wildfiresafety good morning, everyone i'm sue herera here is your cnbc update at this hour iran's nuclear chief says he hopes the deal will survive but will the program be in a stronger position than ever if not? he spoke in an interview with the associated press. >> if we have to go back and we stop the nuclear -- we withdraw from the nuclear deal, we certainly do not go back to where we were before we will be standing on a much, much higher position. >> russian president putin

holding a news conference with chinese president xi after the two held talks in vladivostok. he said it's vital for peace on the korean peninsula and that u.s. and north korea normalize their troubled relationship. residents eager to get their hands on bob woodward's book on the trump presidency the store in d.c. opened its doors at midnight to start selling the book it is the number one seller on amazon you are up-to-date that's the news update this hour carl, i will send it back downtown to you. >> sue, thank you very much. let's bring in art cashin, operator of floor operations on this 17th anniversary of 9/11. art, you write a daily comment and say in today's comment that the comments that followed 9/11 are the ones people request the most. >> yeah. i'm very honored by it, a little emotional. it was a -- it was a disastrous day, followed by a series of bad

days, you know as i wrote, the only smiles in the area around wall street were in the photos on the missing posters that people put up, trying to find their family members that they couldn't recognize. you walked in the cold dampness afterward, came to a street corner, whether it be a checking point where the national guardsman or policeman nobody was combative they all said thank you and marched on it was with a heavy heart. we couldn't get reopened because the buildings coming down ruined the telephone lines. out of work for four straight days we opened some time later, not because anybody wanted to trade but the president and others said we need to get the economy moving again. >> you mentioned the president here is president trump, about to speak in shanksville,

pennsylvani pennsylvania. >> thank you very much thank you very much. so beautiful we're gathered together on these ha hallowed grounds to honor the memory of nearly 3,000 souls who were murdered on this day, 17 years ago. we're here to pay solemn tribute to the 40 passengers and crew members on flight 93 who rose up, defied the enemy, took control of their destiny and changed the course of history. today, we mourn their loss we share their story, and we commemorate their incredible valor. on september 11th, 2001, a band of brave patriots turned the tide on our nation's enemies and

joined the immortal ranks of american heroes. at this memorial, on this sacred earth, in the field beyond this wall and in the skies above our heads, we remember the moment when america fought back melania and i are grateful to be joined for today's ceremony by governor tom wolf and governor mark schweiker i also want to thank the members of congress in attendance. senator bob casey, congressman lou barletta, bill schuster, along with the president of the families of flight 93, gordon

felt we're also joined by members of the national parks service, along with firefighters, first responders and incredible people from law enforcement these are truly great people [ applause ] some of you here today answered the call and raced to this field 17 years ago you fill our hearts with pride and i want to thank you on behalf of our country. thank you very much. [ applause ] most importantly, to the family members of flight 93, today all of america wraps up and joins together we close our arms to help you

shoulder your pain and to carry your great, great sorrow your tears are not shed alone, for they are shared grief with an entire nation we grieve together for every mother and father, sister and brother, son and daughter who was stolen from us at the twin towers, the pentagon and here in this pennsylvania field. we honor their sacrifice by pledging to never flinch in the face of evil and to do whatever it takes to keep america safe. [ applause ] 17 years ago, your loved ones were among the 40 of flight 93,

the 40 passengers and crew members on board, the 8 a.m. united airlines flight from newark to san francisco. they were men and women from every background they were young people returning from visiting family, moms and dads on business trips and friends going and coming from birthdays and weddings they boarded the plane as strangers, and they entered eternity linked forever as true heroes [ applause ] soon after takeoff, flight 93 was high jack bid evil men bent terror passengers and crew members began using their phones to call home they learned that two planes had

already crashed into the world trade center in new york city. immediately, those on board flight 93 started planning a response sandy bradshaw, a flight attendant, called her husband and told them they were in the back of the plane preparing hot water to throw on to the hijackers. passenger jeremy glick explained the plan to his wife and said, stay on the line i'll be back the passengers and crew members came together, took a vote and they decided to act. at that moment, they took their fate and america's fate back into their own hands in the last 20 minutes, many placed their final calls home,

whispering those eternal words "i love you. some said the lord's prayer, and then they bravely charged the cockpit. they attacked the enemy. they fought until the very end and they stopped the forces of terror and defeated this wicked, horrible, evil plan. flight 93 crashed yards from where we stand, just 20 minutes flying time from the united states capital through their sacrifice, the 40 saved the lives of countless americans, and they saved our

capital from a devastating strike in the days after the attack, tens of thousands of firefighters, police officers and recovery workers travel to new york and arlington to crawl through the rubble in search for survivors. there were prayer vigils, memorials and charity drives all across our nation. here in shanksville, many of you raised up the first memorial, a wooden cross, a chain linked fence, mementos and tributes pouring in and dozens and dozens of american flags. a piece of america's heart is buried on these grounds, but in its place has grown a new

resolve to live our lives with the same grace and courage as the heroes of flight 93. this field is now a monument to american defiance. this memorial is now a message to the world america will never, ever submit to tyranny [ applause ] since september 11th, nearly 5.5 million young americans have enlisted in the united states armed forces nearly 7,000 service members have died, facing down the menace of radical, islamic

terrorism. [ applause ] today we also think of the more than 200,000 service members now serving overseas and we think of every citizen who protects our nation at home, including our state, local, and federal law enforcement. these are great americans. these are great heroes we honor and thank them all. as commander in chief i will always do everything in my power to prevent terrorists from striking american soil here with us today is dorothy laughlin her son was one of the

passengers on flight 93. on september 11, 2001 just over a month after their 32nd wedding anniversary, sonny was on his way back from a business meeting. he called dorothy who he loved so much, called her on the plane and uttered her name before the line went dead silent. in the days after the attack, dorothy told the investigators there was only one thing she wanted from this field her husband's wedding ring they would know it by the inscription etched inside. all my live, followed by 8-2-69, the date of their anniversary.

the officers, great people promised to try, but in this field of wreckage it seemed certainly impossible dorothy began to pray and she asked her friends to do the same days went by and months. still no ring. a week before christmas, she heard a knock at the door. two officers were standing with a really beautiful to her, she said it was so beautiful she knew what was happening. a beautiful small white box. inside it was a wallet, a luggage tag, a driver's license, a small bag with the wedding ring, inscribed with those three precious words all my love.

those words echo across this field. and those words tell the story of 40 men and women who gave all their love for their families, their country, and our freedom to dorothy and to every family here today, america will never forget what your loved ones did for all of us. [ applause ] earlier this week you dedicated the final part of this memorial, the tower of voices. standing at 93 feet tall, the tower of voices is now the first

structure visitors see when they come to this now sacred ground it will hold 40 beautiful chimes that ring throughout these fields each a unique note, but all in perfect harmony. each time we hear those chimes playing in the wind we will remember the 40. we will remember their faces, their voices, their stories, their courage, and their love. and we will remember that free people are never at the mercy of evil because our destiny is always in our hands. america's future is not written

by our enemies, america's future is written by our heroes as long as this monument stands, as long as this memorial endures, brave patriots will rise up in america's hours of need and they, too, will fight back 17 years ago 40 incredible men and women showed the whole world that no force on earth will ever conquer the american spirit. we treasure their memory we cherish their legacy. and we ask god to forever bless the immortal heroes of flight

93 thank you. god bless you. god bless the families and god bless the united states of america. thank you very much. >> thae >> that's the president recounting the flight 93, saying they entered eternity linked together as true heroes. added a piece of america's heart is buried on these grounds good morning, eamon.

>> the president called the field a monument to american defiance, saying americans will never, ever submit to tyranny. as this event recedes into history, what's remarkable is the memories of everybody effected by september 11 everybody remembers just where they were at the time. i have been talking to younger white house aides in the trump white house about it, so many of them were in grade school at the time of the september 11 attacks. gives you a sense how this moment is receding into history. you see with the president just how this moment continues to impact americans across the country, around the world, continues to define an era in american history the president is doing what has become something of a ritual for american presidents on september 11, memorializing the dead, praising in tribute those that were able to fight back on the last airplane that had some sense of what was happening to them, had some warning, were

able to resist that's a powerful message, carl. we're all feeling it today at the white house. >> truly is, especially regarding flight 93. who knows how different the story might have been had the passengers not acted and crew members not acted as heroically as they did. >> meantime, the vice president and defense secretary outside the pentagon today with remembrances of victims there. >> carl, still tell the story at the white house. the driveway behind me, when the attacks happened, people that were here said the secret service opened the gates, told everyone to run. they thought that last plane might be headed for the white house and they might have seconds or minutes before impact white house staff on september 11 streamed out of this complex, even though the president wasn't here the driveway behind me according to people that were here was littered with shoes, particularly high heels, staffers were running down the

driveway, shoes were simply -- they ditched the shoes and kept running. that's one of the images that sticks with people here at the time, how much worse the attacks could have been if the people who ended up in that field in pennsylvania hadn't taken action >> that's interesting. the reaction at the white house at the time. every september 11, i don't know about you, i am always haunted and struck by the power of ari fleischer's tweets in real time recounts his day with president bush in florida, and provides a real window into how information gets into the presidential bubble, and how difficult it is to move that bubble in an emergency and sort of the difficulties in communicating, rumors that were false, later shut down of information going in and out of the presidential department. >> it remienlnds you that the president is subject to the fog of war as are the rest of us the communication on air force one and the white house that

day, they've drawn a lot of lessons from that. presumably if something like that happened again, the president would have access to better real time information, but still it is a reminder that presidents react in real time as do the rest of us. carl, for me personally, remember the anger and frustration of the moment. a number of my roommates and i went down early that morning to the local hospital near the pentagon, trying to give blood, to do anything we thought could be useful that morning all the doctors and nurses i remember clearly were lined up on the street at the hospital waiting for casualties to come in from the pentagon in the end, they didn't get as many casualties or wounded as they thought they might because so many people were killed there. they turned us away, said we can't take your blood now, we're waiting for casualties can't be distracted as something as unimportant as that the frustration of wanting to do something and no