bubble it's thursday, september 20, 2018, and "squawk box" begins right now. ♪ live from new york where business never sleeps, this is "squawk box. good morning, everybody. welcome to "squawk box" on cnbc. we are live from the nasdaq n market site in times square. i'm becky quick along with joe kernen and mike santoli. andrew ross sorkin is off today. the dow closed yesterday at the third highest close ever up another 49 points this morning. the s&p is indicated up by 3 1/2 points the nasdaq was the one index that performed lower yesterday only down by 6 points. this morning the nasdaq

indicated up by almost 15 points the nasdaq is down about 2% for september despite the gains we've seen in some other areas, especially with the dow. looking at what happened overnight in asia, the nikkei ended flat hang seng up by a quarter percentage point the shanghai down slightly look at the early trading as we watch things in europe green arrows across the board there. some of the biggest gains coming in france with the cac up by 0.6% stocks also higher in italy and spain by even more than that look at treasury yields, you will see treasuries for the ten-year around the highest levels since may 3.072% >> trying hard every day to get to a grand total of 3.1. the nasdaq was doing so much better than the others it's up like 55% or something from the election. the s&p was hitting a series of

new highs much the dow may hit a new high are you going to do anything today? you're here. you are going to read the teleprompter >> a long way to go. >> you're here we might as well use you >> i'm at your service we'll see what happens >> i don't see any mss on these reads. >> i bet he's doing 7:00 >> you have to warm up. >> don't we all? >> i want to do this one it has to do with comcast, our parent company do you mind? >> have at it. >> all right breaking news on the battle for sky. the fight between comcast and fox is going to auction. very weird you following this >> it's odd. >> you know, comcast has a higher bid, they got like 0.23% of the shares, so everybody is

waiting. >> this is a way to speed things up just give us your best offer >> they have to figure out -- you don't just put one offer in. >> it's over in a day. >> yeah. the uk auction will start tomorrow and end on saturday there will be a maximum of three rounds do we know -- disney at this point is going to get the other stuff. is there some unspoken -- it would be illegal, but you could sort of move your body in a certain way. okay fine. you take sky we didn't want it that much. we want this other stuff we both don't need to way overspend for these things

>> after the first round you would know that. how aggressive the other guy would be >> if you were reading into body language or language -- >> sky is a better fit for comcast. >> yes >> unfortunately iger called it the crown jewels of that deal. >> yeah, well tough. >> still going to have 39% of it for now. >> they'll not keep that, i don't think. they'll lick their wounds from those hulu losses. >> or it gets swapped in for hulu >> see you have to drag it out of im. >> the whole uk takeover law, transparent, get the cards on the table. >> yeah. all right. >> maybe it will be televised. >> you're here, we'll use you,

okay >> i thought that's what i was here for, to be used >> let's talk about jamie dimon sitting down with an exclusive interview with cnbc overnight in india. the headline from the jpmorgan chief, don't call it a trade war. >> it's not a trade war. i call it a trade skirmish the american government, our president, is right to raise issues about china we would like to see a nafta deal done. the strategy about fixing it is different. it's unclear where we will get to if you look at tariffs on 200 billion, just make believe this all got passed to american consumers, they have to pay another $20 billion, it's a $20 trillion economy so the economic effect is not dramatic there is an effect on the psyche, the mind, it could become a trade war right now it's trade tit-for-tat. hopefully we'll get to resolution >> dimon also spoke about global growth and said for the most part central banks are handling

it the right way >> we're growing strong, raising rates, reversing qe, that's going to be fine if it has to be reversed in a much faster way, if america has inflation, then you can see central banks doing things we won't like, and people will get concerned about it in and of itself the world is growing. reversing qe is the right thing to do. >> he spoke about the rout in emerging markets saying it could present a big opportunity. >> i'm not concerned put turkey and argentina aside where you have serious issues, the rest of the emerging markets are doing well america's gotten stronger. the dollar has gotten stronger that's good for the world. the world is growing so the emerging markets, it's more like teething pain. they're not all the same i don't think they should be called emerging markets anymore to tell you the truth. >> you can see more of dimon's interview with cnbc on cnbc.com. what do you call the emerging markets if not emerging markets?

>> people tried to call them developing markets >> i guess differentiating, not grouping them all together >> they tried with the bricks. >> frontier markets. nigeria. >> further than that >> tiny ones dimon is not the only ceo talking trade. jack ma also speaking out on the issue. and the chinese billionaire is walking back his pledge to create 1 million u.s. jobs he's blaming the trade fight ma initially made the pledge to create more jobs in the states after meeting president trump, who was actually president-elect at time. ma said this was on the basis of friendly u.s./china cooperation, but the current situation has

december pie estroyed that basis i guess the last 20 years he thought we had reasonable trade with china he said this promise can't be completed. at 7:00 a.m. i understand you're fully part of the team. >> you got the formal word >> if you're tweeting, there's a #lethimread. i've seen it it's trending. not quite top ten, bu but #lethimread. it will catch on let him read let him read let him read >> you are reading along, practicing as we go. >> exactly >> just imitate me >> don't do that watch out. new this morning president trump nominating former federal reserve economist nellie liang to the central bank's board of governors. liang's nomination is the last

needed to fill three openings on the fed board. the other two nominees have yet to be confirmed by the senate. let's talk about the fixed income and equity markets now. joining us is kevin gittis from raymond james, and erica knudson. remember new math? you might be able to talk about both you're multi asset you're only good -- can either one of you guys read teleprompters? >> yeah. >> i don't know if i can read as well as mike >> you can >> look. they think andrew is in today. they have the dash marks the pronunciations 3.07 is where we are on the ten-year >> yeah. >> more interesting to you maybe? is it corporates high yields?

people are chasing yields and they're finally around on the short end. are you feeling better about your chosen profession do you wish you had gone into equities >> after 35 years of doing this, i either made my parents proud or i'm the biggest disappointment >> what about pot stocks think about making that move there's a lot happening there. >> the problem with that is it's still requiring federal law approval states are one thing >> did the person who arranged your interview mention you might have to comment on pot stocks? >> no. i'm trying to figure out what to talk about next. let's talk about the bond market we didn't see this move from, say, 2.95 to 3.10 coming with an average hourly earnings number as high as it was, that was a market surprise. that brings into the fed maybe a second cut after next week maybe december comes in.

that is where maybe some longs threw in the towel we have seen this before mid-may we hit 3.11, then a few weeks later 2.85 this could be part of the range. it could be part of a new move to 3.25 prior to year end. but it will take a pc core above 3.10 >> everything you're describing, all the good things would mean higher rates when we go back down to 2.80, it's like, i don't know, constitutional crisis. possible trade war it causes people to rush to unload some risk and rush to safety it's okay. it's good it's going up, no, i didn't it? >> yeah.

>> higher wages? >> we like long lines for cheese >> is that an expression that's nice. soup lines are good for you. that's awesome >> this is not going to be harmful to anyone in terms of the bond holdings because we don't see -- i think we'll end up below 3% before the end of the year i'm not sure the fed will get that december raise in if so you go into the next year thinking two raises for the fed. we're in a tight range but it's not harmful to go from 2.90 to 3.15, 3.20 as long as it's in an orderly way. >> i don't think a day goes by where i don't see something that hasn't been this good in 50 years, right you can find all these different pockets of -- whether it's unemployment -- >> lowest unemployment since 2000, wage growth picking up

corporate earnings >> is that good or bad if it's so good, are you worried we can only go down from here? or are you gratified that so many people still say -- i read in the papers here that we'll get through these challenging times. i'm like, what are they talking about? those mean tweets? >> we don't think we've seen the peak in u.s. economic growth we've seen some robust economic growth but we think the cycle is continuing the biggest question we have is not whether the u.s. will continue to go well, we think it will but it's whether the rest of the world starts to catch up >> but to joe's point there was a statistic in the "wall street journal" that showed that investors have 5.1% of their holdings in cash the highest level in 18 months people are nervous, why? >> i think there's reason for short-term caution that 5.1% in cash shows

investors are not engaged in excesses i think that reflects the broader global picture the u.s. market may be up 9%, 10%, em is down as much. you've seen a statistically incredibly improbable divergence between the u.s. and the rest of the world. that's driven by great economics, great growth in the united states without inflation. that has not played through to the rest of the world. our biggest concern around the current situation is not that the u.s. economy continues to do well we think it will our target on the ten-year treasury is 3.13 we think there's upside to 3.25. if the rest of the world never starts pitching in and the fed starts having to move to manage growth and inflation in the united states when europe, japan have not come back, you've seen some more bodies float to the surface in the emerging markets, that could bring forward the

cycle. >> you say if, is it your call that the rest of the world firms up >> absolutely. our call is convergence after this demarkabs remarkable divere we're barbelling the environment. we want exposure to the u.s., the best rapidly growing, dynamic economy in the word. then exposure to valued areas of the world. with the exception of argentina, turkey, and now maybe south africa, the rest of the emerging world is in good shape fundamentally. >> well, we shall see pot stocks -- what do you think? >> is this the time to say they're at new highs >> did you hear that got a comedian >> or are they blowing smoke >> not bad all right. thanks to you both

>> forget it >> i'll all over it. >> one of the pleasures of being here >> i can see that. mike is experiencing it as well. >> the fire hose when we come back, the pick is in we'll tell who will be performing at the super bowl half time show. and later, tariffs in toyland. the impact of the trade war or trade skirmish as jamie dimon would call it. right now a look at premarket winners and losers in the dow. caterpillar leading the way. stick around, "squawk box" will be right back.

welcome back

an investigation into mark cuban's dallas mavericks uncovered a two decade long culture of misogyny and harassment the investigation found no evidence that cuban participated in wrongdoing or even knew about it he spoke to cnbc yesterday >> first an apology to the women involved a couple women were assaulted. not just to them but to their families because this is not something that just is an incident and then it's over it stays with people it stays with families and i'm just sorry i didn't see it i'm sorry i didn't recognize it. i hope that out of this, you know, we'll be better.

>> adam silver calling the findings of the investigation disturbing and heartbreaking >> if you ever had an embarrassing typo in a work e-mail or even worse, if you get a tattoo -- >> i've seen them. you think would notice but employees of cathay park airlines knows the feeling one of the planes made it to the runway with it spelled like that i don't know how to say that >> paciic. >> it was three feet tall. the guy doing that -- i guess, you can't see the forest through the trees. you're that close. you get done, where is the "f" >> somebody said get the "f" out. >> hey, you are -- wow you said you don't wake up until -- >> that was obvious. what does that "f" stand for you didn't wake up until 7:00 you thought.

>> really. >> you're on. >> >> once tonce the mistake wad out, the company said, oops, she's going back to the shop. the super bowl half time show is one of the biggest music events of the year, and this year the event is in atlanta and the headline performer is maroon 5. the maroon 5 stuff, i like it. >> god >> i do. on the radio all the time. >> the target audience for the super bowl is literally everybody. it's broad, it's not going to offend anybody >> it's offending me >> they've been on the radio for 15 years >> they have it's funny people in atlanta acting like -- who is on "the voice?"

is he the guy on "the voice? okay i like him all right. university of colorado's mascot had to be carted off the field due to an unusual injury wait what university this is. i thought they would say the actual buffalo himself but this was the mascot. i thought something happened to ralphie. while trying to shoot a souvenir into the stands, the t-shirt gun misfired hitting him in the groin. the mascot was brought off the field by the training staff. >> he must be okay >> he's a gelding now. >> but according to the team's twitter account, he'll make a full recovery. but he talks like this now go buffs love that place.

beautiful. from there, sitting on that side, you can look up into the flatirons. whoa whoa wow. he went down down goes frazier! whoa coming up, pot stocks flying high that didn't sound like it. we'll talk about the rapid rise of cannabis companies. and in case you missed t a look at the wild ride from one pot stock yesterday. tilray >> shares were up 50%. >> we have to talk cannabis this morning. tilray continues to soar ahead of full legalization of marijuana in canada next month >> tilray have built that thing the right way. you look at the market enthusiasm right now the problem is there's not enough supply. >> the pot stock is soaring. tilray up 1,186%

>> want to draw your attention to shares of tilray. they've halted for volatility to the down side. it was up by 94% before dropping sharply. >> tilray in our opinion is a weaker stock >> shares of tilray briefly reopened moments ago before being halted again that's the fourth time now >> i think so. >> tilray practically broke the ticker, halted not once, not twice,othr tesnofo n teeim, t ur times, but five times, going negative before finishing higher [ upbeat music playing ]

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♪ good morning welcome back to "squawk box. among the stories front and center, the fight between comcast and fox for sky is going to auction a uk takeover panel will use a rarely used auction procedure starting tomorrow and end on saturday the action will consist of a maximum of three rounds. shares of red hat are coming in weaker than expected revenues for the latest quarter. shines also coming in light. shares down about 6% in the premarket. and jamie dimon talking about trade, saying there is not a trade war but a trade skirmish right now dow futures are up by 41 points, nasdaq up by 10, the

s&p up by 2 1/2. the world's largest corporations are expecting to get smacked by trade that's according to the latest cnbc cfo survey. 75% of those asked feel trade will have a negative impact on their business more than half have said they developed a contingency plan and close to 40% say they experienced higher input costs the survey was conducted before the trade escalation between the united states and china. however trade is not the council's top worry. 46% said the biggest risk factor is consumer demand which has been a growing concern for the group since the first quarter of the year for full survey results head over to cnbc.com marijuana stocks catching fire yesterday getting high lighting up the markets.

all the other bad puns that are written out for me the sector is gaining more and more attention from investors. dominic chu has a look at volatile action. >> do you always read what's in the prompter >> probably not. >> i'm part of this mikesanto santoli #lethimread. >> should be make him read >> i would be hard pressed to remember a time when i saw one stock go the way this did yesterday. >> in the late '90s maybe. >> i started back in '99, so in the dotcom days i remember seeing this kind of stuff. like internet capital group. >> the stupid things on airplanes, before the internet >> sky mall? >> yeah. >> crazy stuff

>> pets.com. so what this comes down to is a move that almost doubled the value of a stock, a multibillion dollar company to begin with looking at the stock from a two-day perspective, at one point 90% gains intraday, only to see it halted throughout the down side. five times it was halted by the nasdaq for trading volatility. at one point it was bigger than almost 60% of the entire s&p 500. it is currently now, if it was in the s&p 500, greater than 45% of the stocks in the s&p 500 this is a company that made around $9 million of revenue last quarter when we talk about perspectives of valuation, these are trading dynamics even if you believe from a fundamental standpoint that cannabis stocks, marijuana will have a bright future like the internet did, these types of trading moves don't often happen if you look at a price to sales

perspective for some of these stocks, trading valuations for entire industry over the last couple of days has been insane if you look at the tilray, 980 times earnings -- something funny just happened here >> funny for you >> 120 times sales, tilray 970 times. crow cronos 512. canopy growth, they make product, good revenues, but still considered a cannabis stock. now, i would say this, a lot of the trading was technically driven it's not fundamental because this was a low -- >> even after the pe -- >> that was price to sales these guys don't really make a lot of money now if you look at the way these

things trade, tilray's ipo in july was a low-float ipo only just around 20, 21 million shares out there that you can trade. yesterday's trading volume was 30 million shares. it turned over 1 1/2 times of the total out there. short sellers have a big part in this thing getting squeezed. i remember looking just throughout the course of the day to figure out whether or not this was a stock that was going to be driven by technicals i looked at a broker platform to see what it would cost to borrow thisstock and short it, it sai htb which means hard to borrow when you see hard to borrow, so not a lot of stock out there can't do a lot of stuff there. that's why those stocks moved the way they did joe, did you get wet

>> everything i own did, i think. >> i think dom's pants took most of the water >> the mug that was right here >> yes >> just the extreme scarcity of the stock relative to the perceived ultimate value of this entire sector, all the enthusiasm behind it, you would say this company should do a secondary, hit the markets big, the price is so high, if you want to go out to institutional investorses a es and say we'll this thing, most will say you're crazy. >> because it's listed in the u.s., there's regulations in the u.s. and canada, this stock only went public back in july there are lock-up windows. all kinds of things at play which prevent it from saying let's sell a whole bunch of stock now. we heard on jim cramer's interview they will have to raise capital. i don't know if this is the time they can from a regulatory

standpoint say let's sell x million shares of stock while we're worth $20 billion as a company. >> stay right here let's bring in another voice on this steve ottoway from jmp they back cannabis companies we heard a lot of people talk about this dominic laid out the numbers, how difficult things are jon john najarian said this is stupid territory others are short the stock what do you think from somebody who is watching this and backing this is this good or bad to have this volatility around the stock? >> it's not good it doesn't help the sector this sort of volatility, it spooks institutional investors they look at this sort of

movement it's difficult for them to pin and say where is the value hard to borrow -- i know the trading numbers for getting to borrow has gone from 300 to as high as 800% in the last week on the stock. i've had a long career i've not seen those sorts of numbers before the challenge is this is a new sector the world is already using these products we are just moving people from the legal marketplace. the u.s. alone is probably a 70 billion there market that needs to be converted. a lot of people are looking at it it gets people excited tilray stands out because it's

canadian so it is available for people to buy, and there's not many more options to go to >> what would you like to see happen right now people are talking about the money coming in from the beverage industry, using this as a hedge as tilray's ceo said to jim cramer the other day. but all that speculation is why there's a frenzy around this now. >> yeah. it's a good point. the beverage folks are all circling they would prefer this goes a y away cannabis will eat into the alcohol side if you assume that someone could use cannabis and drink beer at the same time, maybe they're drinking half as much beer so you'll see potential pullback if you can infuse drinks and sell them in a bar setting or something like that, maybe that helps sure it up

>> more beer >> maybe maybe. >> less beer >> it seems to be the most vulnerable in the equation >> really? you might stay with as much scotch as before but you see that in constellation's move they decided to lay down the line what do you do with $5 billion if you're canopy/constellation, there's only one place in the world to spend that, that's in the united states. >> it's not legal in the united states the legalization is coming next month in canada. if things go the other way and the trump administration starts cracking down on some of these states that have legalized it here or if there's not a movement to nationalize it, we've seen some stocks trade down violently when you talk about employees who are going across the border into the

united states being held up by customs. if it's not legalized in the united states, do the valuations make sense >> very good question. you know, the question i think really comesdown to when i think the canadian experiment which has been unfolding and we're about to go legally federally on an adult basis next month will have the entire world watching if people go across the rubicon to get medicinal and the pathway has effects that have not been researched, it's a simple walk across the street to determine the direct marketplace instead of allowing this to be run by people who may not be good people and missing those tax dollars, it doesn't make sense that you wouldn't want to get in and regulate that. so it's just a question of timing, administration, interest in doing so. >> probably depends on the

administration, too. >> absolutely. >> this battle is still raging >> sure is so the canadian experiment is going to be a fascinating one to watch unfold here. >> steve, thank you for your time appreciate you joining us today. dom, good to see you >> always good to see you. i'll try to keep the set drier >> you love your stories >> i do love my stories. you love this pot story. >> i get assigned these stories. >> you volunteered for this one. >> no, i got handed an assignment sheet that said we want you to cover pot. >> joe, you are the only one who outed your own personal experience you would drink more beer. >> yeah. >> you would visit taco bell >> taco bell sales went up in colorado after pot was legalized. >> not chipotle?

>> taco bell is open late. >> i'm a california guy who likes taco bell. tomorrow on "squawk box," the ceo of canopy growth will join us to talk about the booming marijuana industry and whether this volatility and upside is a good thing now >> why not drake >> for super bowl? >> yeah. >> imagine dragons >> i would be in for them. >> i thought they would go mort country route. >> post malone that might be hard a lot of bleeps. taylor swift >> i actually had heard some rumors >> the swifties. >> kenny chesney dierks bentlererkr dirks bentley. >> death cab >> death cab for cutie >> maybe they're coming >> i like them i don't know they have the wide --

>> no it's kind of -- not quite upde upbeat enough. coming up, fighting the effects of aging we'll talk to dr. james kirkland from the mayo clinic get your iphone out and get it on google. i know this. we'll get very specific. at the top of the hour, our -fnd khost will be home depot cooueren langone andrew is not here, that means ken is here. really want to be there,

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gary cohn and wells fargo are denying a "new york post" report that wells fargo approached cohn to be its next ceo. the report says wells fargo board members were looking for options to replace tim sloan betsy duke says rumors that wells fargo board of dreshgts reached o directors reached out to potential ceo candidates is

false. tim has driven significant transformational change at wells fargo, which is benefiting all stakeholders >> i heard, you know, cohn could be a cnbc contributor if he played his cards right not guaranteeing we would be interest interested he was there for some interesting things >> has a lot to say. >> might put a good word in for him. you know when a sports team wins, people head out to the streets and immediately start demonstrating? i didn't expect that to happen this quickly but apparently there are demonstrations i have a picture of some demonstrations already >> let him read. let him read >> i shouldn't say this, when they ask me to do this, they say

just sit there for three hours, take some abuse from joe, chime in once in a while this will be a much heavier lift are you up for the challenge >> next hour >> don't know why this is tickling me. >> because we're infantile coming up, a new drug cocktail shows promise in extending human health span. it's about cells and anti-aging. we'll talk to dr. james kirkland about fighting the effects of aging. that's next. at&t provides edge-to-edge intelligence, covering virtually every part of your manufacturing business. & so this won't happen. because you've made sure this sensor

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♪ i want to be forever young some are calling senelytic drugs a fountain of youth. our next guest conducted the study of a drug cocktail that extended the lives of -- in this case it was mice it would be great if it worked

on humans. dr. james kirkman from the mayo kline ec it'so clinic week. one of the greatest institutions in the world the proof of concept is that they cells, not cancer cells, but they're similar, because they don't die, they build up, they're called senescent cells, if there's too many, they cause the chronic diseases of aging, diabetes, dementia, inflammation, so if there was a -- this has nothing to do with cancer or the telemeres or -- it's not keeping cells dies. >> senescent cells kill cells

around them and cause problems at a distance. they spread senescence from cells to cells yet they don't die. >> why don't young people have anything or not as many? >> they don't have as many they can develop them during the course of wound healing, or in other situation, or if they develop an age-related disease. >> is there some role or positive reason why these cells develop? >> in small numbers they act as a defense against cancer if there's cancer mutation, they -- it kills the cancer cells around them. >> if you're a really young 85-year-old, or if you're a really 60-year-old, does it have something to do with that? >> yes we found when we studied 75 to 0 years olds appeared one group was frail and the other wasn't,

the frail group had many more senescence cells the drug is a monoclonal oh, ibb, so spry cell is the name -- much that's a trade name. >> so it's used for a type of leukemia. >> right, and certainly other cancers. >> but it also seems to selectively kill these senescent cells without a lot of collateral damage? >> particularly if it's combined with other compounds it disables the pathways that senescent cells use to stop them from dying from the factors -- >> so they die and it seems -- >> they commit suicide >> and the other thing in the cocktail is a flavonoid that you go ahead in broccoli >> apple peels. >> blueberries

>> correct. >> an antioxidant that seems to work sinner -- synergistically. >> so there's a natural way to not build it up? >> did you bring any >> no. at this point we want to study these things in trials. >> all right, all right. >> i advise people not to take them until the trials are complete trials are under way now by us. >> i wish we had more time i wish you would come back it's fascinating and seems new to me. i didn't know of this whoa endeavor their you very much, doctor. our guest host for the rest of the show will be meepho dot of the show will be meepho dot founder ken langone.

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new this morning, the bidding war for sky will enter an auction. jamie dimon sis it's not a trade war, it's a skirmish and home depot owner ken langone. what is moving this market higher we'll ask pros, as the second hour of "squawk box" begins right now. >> announcer: live from the beating heart of business, new york this is "squawk box. good morning, everybody. welcome back to "squawk box"

here on cnbc we are live. i'm becky quick along with joe kernen, mike santoli, and in the studio for the remainder of the show is ken langone. it's great to see you. >> thank you for having me. >> thank you so much for coming in >> it's like christmas every morning. >> where is andrew >> he's ducking. they're on the run >> he doesn't want to be in a room with you. >> going into deep retreat >> he doesn't want to be in a room with you right now. >> i don't think so. >> we need to change the whole gdp numbers. that's what andrew's friend -- we have tots it back under two >> james leonheart says the things we rely on -- >> change it's too good. >> do not reflect american life for the reality. >> let's change it why didn't we change it to get it up to four? illustrates need an answer to

that question? let me say this right now. >> really? now? you want to start? >> this economy is booming home depot is doing great. all the transportation companies is an early sigh, and like at the railroad stocks yesterday. >> deregulation and taxes? >> mea truck leasing business we can't get delivery of new trucks until next spring. >> drivers >> we're able to get drivers it's tougher and tougher you pay they more and they don't want to do long haul i don't blame them, but the important thing is every indicator that i see tells me for the moment -- now, six months from now, a year from now, and like it or not, i would rather be lucky than smart so assume trump was just lucky he's lucky to be president then when these numbers are happening. you want to say he's worthy of it that's fine. but the point is it's happening.

he's made a lot of moves that are constructiveto the economy the tax change -- none of that deregulation is having a profound impact of the mindset on business people you walk in and you feel good. you say, you know what i want to invest some money today. i want to do things. hey, by the way, i brought you some stuff >> really? i have some flavonoid. >> this is my contribution to the environment. >> thank you. >> becky, what size? >> joe, that's yours >> i think this is becky's that is yours, an nyu color for you, this is for the commie tell him when he comes back, i didn't forget him. >> they're made out of recycled water bottles. >> you have brought stuff like this before. >> it's warm. >> pretty actually you're going to want those in

davos. >> you'll be in style. i have something else here hold on, hold on >> this is made from one bolttle >> empty bottle a bottle of water has water in a bottle a big dinners. >> kenny told us we have to do headlines. we're going to get to ken and drag some opinions out of him. >> and mike is going to read. >> my last appearance, my shrink said you're finally coming out of your shell. we're making progress. >> yes, the retiring, very shy ken langone. we'll get more from him quickly. the bidding contest for british sky broadcaster -- british broadcaster sky will be decided by auction that's coming from the takeover panel this morning the auction will begin tomorrow.

comcast currently has the highest bid on the table 21st century fox currently owns about 36% of sky we have a busy morning in just about 90 minutes' time we'll get the weekly report on initial jobless claims from the labor department later this morning, the national association of realtors will report and jack ma has pulled back on a promise to create u.s. jobs he cited the ongoing trade dispute. he originally made his promise in 2017, saying the jobs would be created through more sales by u.s. businesses on alibaba's e-commerce platforms. all right. all right. here we go, seg mike. >> a few stocks on the move. tilray, of course, the canadian cannabis company, in yesterday's trading session, stock jumped

38%, though it was after being up almost 100% intraday. it's up 90% or so this week. still indicated, right now at 4.5%, $224 is where they'll open. and red hat until pressure after the close for the eightest quarter, guidance coming in light. shares of red hat in the premarket indicated open down about 6% this stock has been strong over two years. >> wow wow. >> that's -- i mean, that's -- >> well done >> there's a groundswell groundswell, #lethimread. >> good start. good start i'd rather have two than none, right? >> did you see this? responsible takeniusly it sprung up. >> it does actually. we didn't do that. >> yeah, we didn't

you know what bothers me about this whole pot thing >> what? >> go ask anybody involved in addiction treatment. >> gateway. >> the entry drug is marijuana that's the beginning of the process. now, this is brand new if we were just starting the tobacco industry, you have it at $15 a pack, put $so into a fund to take care of these people when they're dying of cancer, m emphysema, and inevitably there would be some of these people that sought out using legal marijuana that will end up being addicted who will pay for the treatment forget about the any wish appeared the pain of dealing with an an addiction think about the cost, why not charge enough money and say you want to get stoned that's fine. >> you're preaching to the choir. i'm concerned about what it does

to the brains of younger people. >> it's already everywhere, and is it worse than alcohol i don't know we went true p-- through prohibition. >> they keep mentioning it as a way to raise revenue colorado is doing just that, using the money for addiction issues >> it sounds crazy -- >> auto accidents in colorado have gone up. >> if you tax it, you can pay for rehab. >> creating more people who need it -- >> are you creating it, because it's already -- >> don't misunderstand me. when people wanted to get drunk, even though you had prohibition, they found a place to get booze, but you're making it easier. all i'm saying is you brought it out of the closet, price it, set up a fund dedicated actuarily

sound fund programs, where kids -- particularly now if it's considered to be benign and legal. >> although a lot -- a lot of this is an additive -- >> i don't have any problem with medicinal. >> and you can take off the stuff. >> opiates start as a medicinal. they start out as a medicinal. okay, this is no different, but you've got to think about what we're doing to kids. >> well, the fda commissioner has joined us and always questioned of idea of using a lung as a deliver counter system he would never recommend smoking to do it >> the lungs have one fundamental purpose, to get oxygen to the blood. that's a whole psychological and

biological care and treatment. jamie dimon sitting down with cnbc overnight in india the headline -- don't call it a trade war. >> i called it a trade skirmish. >> a skirmish? >> the american government, or president is right to raise the issues particularly about china. you know, the strategy is a bit different. i may have used a different strategy it's unclear where we're going to get to, but if you look at tariffs on $200 billion, okay? just basically it all got passed on to american consumers, they have to pay another $20 billion -- are a $20 trillion economy. there is an effect on the psyche, the mind, if it becomes a trade war. right now it's trade tit for t tat, and hopefully we get to a resolution our guest today is ken

langone, what do you think >> i think it's a skirmish i think it's a tactic. by the way, hooray our leaders for the last 20, 25 years have had their knickers taken off by our trading partners if you want proof, why is the other side i fighting not to change it? because it's good for them 30 years ago there was a rationalization for helping china, because it wasn't developed. china today is the second largest economy in the world and more importantly within ten years, just by sheer numbers alone will be the number one economy in the world but here's where not liking a guy gets into play give the guy credit. first he's doing what he said he was going to do in the campaign. he's doing it. that's unusual for a politician.

read my lips, no new taxes, that's only a campaign promise he raised tax and then got kicked out of office what i'm saying is we need our traded partners. we did it for germany. germany wasdevastated. we did it for europe we're a wonderful country. we help them get on their feet we didn't do what we did after world war i, where we stripped germany of its industrial capacity leading to an incredible inflationary period of time, leading to misery, leading to hitler coming into power. the make it miserable enough, bad things happen. like at venezuela. whatever jamie says, i agree with, he's so smart and he thinking, something i don't do sometimes. but he's right it's a skirmish, a tactic, in both mutual interests to if fix it china is better off with a revised deal than no deal. so that would happen >> having said that, you start

hearing from the other side. obviously they're going to push back jack ma has said some continues that have been concerns, not just what we just mentioned, but him thinking that this is going to be a problem that lasts five appeared potentially 20 years in terms of our relationship. >> guess what? you can't put pressure on china. you might not see them again so he comes over here, and he n ingratates himself, but jack ma is doing what he should be doing for his shareholders and his business. >> what's best for home depot? >> free trade is best for everybody, but it's got to be fair >> no argument, but the path to getting to that, farmers are paying a bit of a price right now. we have seen some price increases in places like

aluminum will we see some disruption >> yes unfortunately it's uneven. it's not going to affect everybody evenly that's okay, as long as we're moving -- i haven't talked to one person yet who has not said we've got to have china modify their relationship with us so we know the overall goal is the right goal it's like watching sausage being made it isn't pretty. this is where we are, but god bless us, we're starting the process. we're not kicking it to the next administration or the next administration >> we're changing the relationship long term makes a lot of sense to everybody, i think, with china, but it doesn't mean fixating on this yeex or next years's trade deficits with china is not part of the equation, right i think that's the mismatch there it started out as we want to sell more stuff, we want to

reduce the trade deficit, but as opposed to the temperatures are bad -- >> but one leads to the other. >> well, we'll see. >> hold it >> if we look 15 years from now. >> look at the arbitrary rules that china have put in place intellectual property, we say if you have the mind to create something that's different respect that's original, you're going to have 17 years or whatever the number of years is now to exploit your technology, your invention they routinely pirate -- go over there and look at the number of products like this that have logos on them, american logos, and never -- don't make a nickel. >> you can see it where there are these global viruses that roll through windows was one of the ones hit so hard. it didn't affect a lot of people in the united states and europe,

because microsoft had put out fixes. it was devastating in asia, because it was all pirated stuff, because they couldn't get the fixes on it. >> look at the bizarre behavior. consider this -- the former head of the cia is encouraging two senior officials of the united states government to disobey their boss brennan the other say says to wray and the other guy, don't do it, make them fire you if you did that in the army, you would get shot it's called treason. this is how bizarre this thing has gotten look, trump was not supposed to be president 7:00 on election night they had the champagne open over here at the center to celebrate the arriving of the queen. guess what thank god she's not a queen. thank god she didn't get

elected. thank god we have a guy in the white house that at least understands business and look at the results. we're all better off, like it or not. >> 1976, i've been my own -- i have my own cross to bear there. i voted for jimmy carter, but brennan voted for the communist candidate in -- i don't even know -- i was looking up to see who it was but in 1980 when he entered the cia, he said i'm worried -- gus hall, back in 1976 i've never -- i feel like -- i feel bad that was the -- we don't need to get into that. >> jimmy carter was well intentioned. >> right we've seen that happen again >> he was preaching things we needed to hear. >> that was only four years. think if he won eight. >> thank god he didn't but we're coming through a

horrible period. i remember the paralysis in this country around the watergate hearings i was riveted to the television to watch it. we were coming through a war that was so unjust by the way, that war was strictly by our leaders. we now say my god -- read ken burns' piece -- they had it on pbs, an eight-part series. my god, what were we doing >> my son bruce ace wife, they're vietnamese, they come over, they loved americans this was just nonsense there's a trump tweet, and there's no reason to think he was listening to the discuss, but he did say -- financial and job numbers are fantastic, plenty of new high-paying jobs available in our great and very vibrant economy.

if you're not happy where you are, start looking, but also remember, our economy is only getting better vote in the mid terms. >> one more tweet. >> about the middle east. >> they would not be safe for very long without us, yet they continue to push for higher and higher oil prices. we will remember the monopoly must get prices now. every time you see the wti pick up, this has been a familiar refrain. it's definitely a factor in oil prices. >> of course it is. >> the saudis know they're watching. >> and look at the oil we're pumping out. i was in washington the other nice, the secretary of state had a small dinner one of the people was a the prime minister of poland he's excited as all get out about our relationship he's saying, guess what? we feel safe now we were over there next to russia we didn't feel safe. this guy here, our president, i

feel safe tonight. i know god forbid if somebody does something untoward, he'll bet with us. >> wait under we have -- did you see that >> that was their company. >> they said they'll pay for it. ken langone is our guest host when we come back, autosubscriptions are gaining speed. phil lebeau has a preview. >> it may seem odd to some people you would sign up for a new car loan or lease for three or five years. why not do it month to month why more people are looking at that option, coming up on "squawk box. your muscles look good, but we should be seeing

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in a two-hour window so you're up and running in no time. show me decorating shows. this is staying connected with xfinity to make moving... simple. easy. awesome. stay connected while you move with the best wifi experience and two-hour appointment windows. click, call or visit a store today. want a new car, but not sure whether to buy or lease? you may want to consider an auto subscription hey, phil. >> there have been a number of auto makers with limited trial programs, but on a very limited basis, and for quite a bit every month. the expectations is 10% of the auto sales will be part of a monthly subscription plan.

one service getting more attention is fare. they've been in operation alternates over a year and will already amassed 18,000 the average subscription is 18 to 24 months they then use a vehicle to be an uber or lyft driver. we called up with a people who are a subscriber of fair a business woman uses this service for her poach boxster, who says, look i won't always be here, maybe on the road for a three to four to five months, that's why i like the idea i have the car when i need it. when i don't need it, i can turn it back in i if i take on a special project that has me in another city for six months or so, i like to give it back and maybe get something in whatever city i'm in, appeared just not need to kip of be tied to

something for three years or five years i leek being ability to operate month to month >> guys, the growth and success of fair is certainly getting attention from other used operations that are saying, way, this is a good way to use the inventory to bring in po templeal buyers if you will. don't be surprised if you see pour appeared more of these type of services starting up. thank you, phil. you're a big fan, too? >> yeah, but i don't get any swag have them send something to the chicago bureau >> okay. we can -- >> by the way, this subscription nonsense -- >> how about these, phil these are yours. >> they're in cars, by the way the fabric of ford cars are made out of that material.

>> now you're talking lebeau's language. >> yes, i am. >> were you going somewhere? >> subscriptions this is how subprime debt started. okay look if it's a modest percentage of total leasing or financing, you can handle it, but let this thing become a significant part, you're right back -- it's simple make sure people who goro money from you can pay you back. >> but the standards have gotten significantly improved across the board. >> i agree, but if you have 90% of the debt in america on subprime basis, you're head interesting a problem. just the odds. that's all coming up, we've got some breaking news from earlier this morning. the fox/comcast bidding war for sky is head fog an auction, to settle the takeover ballots the. details are straight ahead

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>> announcer: now the answer to today's aflac trivia question. after macy's, what was the second largest department store in the '60s? the answer -- hudson's good morning, everybody, welcome back morning the stories that are front and junior, jamie dimon is not worried about higher interest rates, at least not yet. in an enter with cnbc, he says the ohm concern would be if the fed is forced to raise rate hikes. >> if it has to be reversed, if america has inflation, we'll see central banks doing things we don't like, but the world is

growing, and reversing qe is the right thing to do >> he also said the relationship with china is trade skirmish, not a trade war. stock up after darden earned 1.34 a share the company also increased the full-year outlook. comparable sales triple what the street was expecting. accounting changes are also contributing to amazon's advance. it was a strong session on wall street yet. savita, and mike thompson of s&p

will both join us after this break. gh> equity futures have been > d uo scobey will be right back

let's get to our great resource of the day, ken langone is ready to talk about anything one of the founders of home depot, you live in florida parts of the year. >> new york resident illustrates okay, but live in florida. there's some interesting things happening down there which you can paint with a broader stroke, but i think this mayor is backed by bernie sanders, and desantis backed by president trump. gill many is up six or seven points over desantis is florida ready to vote for

someone who is backed by a socialist? can you imagine that in florida? you don't even have an income t tax. >> what were the poll numbers at 7:00 on election night >> the bugger story is that ocasio cortez is one of the darlings, elizabeth warren will get reelected in a landslide what will happen is that the geographic center of the democratic party they're saying socialism is not a dirty word anymore. >> it's enticing to say you'll have free health care, free education, free this appeared that i think those are the words heard by the people of venezuela 10, 15 years ago guess what it doesn't work. if people are going to go in

that direction, if they're going to go -- i don't believe they will, but if they're going in that direction, that's their call >> we've been talking about all the figures you are singing, why is it possible that the republicans could lose both the house appeared the senate theoretically -- that's the old expression, why does it not take precedent? because of the personality >> they ted it's the economy stupid, and stupid it. >> not the not the founder of the ice cream chain >> carville, the adage is people vote with their wall either. the biggest problems you've got when you embrace or advocate a

position, you allow your opinion to infiltrate user position on things that are beneficial to your point of view so it's natural for me to say we're going to be okay in the mid terms. wide because that's what i want i think the democrats are going to gain seats. i think at best, at best if they gain in seats it would be marginal. >> less than average >> nancy pelosi can get back up on this podium and do the stupid thing she did when she was -- >> do you think she'll by majority leader. >> she thinking she will be. >> speaker i'm sorry. we have chum as majority -- >> i think we'll keep the senate, okay i think by 2020 it would be different it would be back to where i think, first of all, if things stay the way they are, and

improvements, i'm convinced we'll have a settlement in hype. for canada to have this absurd tariff on dairy is nuts, and wisconsin is right next to canada what i want is one thing what will happen may be totally different. i believe we may lose the house by a few seats the its what would that do to the stock market, if you don't -- you don't think that's a time to lighten up illustrates look, obama administered with executive orders why? because he couldn't get anything through the house, through the senate if trump has to do that, he'll do the same thing. i don't think that's a way to govern the i think you send people to washington to represent all of us. their voices should be herd and their involvement is mandatory, but i'm one person

i believe the military is doing better, thank god our economy, like it or not, is hopping big time we still have a major problem in america, and i pray to goed this president tackles it -- public education. considering us as a society, we are a disagree this is where i think obama blew it he should have said i'm going to be remembered as the education president. measure me by how much i help improve poor kids get a decent education in public schools. what a disgrace. what are we doing? we're screaming about bringing kids over here from other countries, because it's a cruel thing to do the we've got millions of kids who are here legitimately and nobody's doing a thing about thinks poor kids getting a good education you want to close the income

appeared equality gap in part? equip the kid better with knowledge, equip them with things he can be competitive with it's not happening so i'm praying to god the president hears, and i'm praying to god he says, okay, now this is the next -- i think it's the biggest thing confronting us as a society. >> use a businessman's lens to try to fix that. >> i believe he'll get things done i want we'll see. we have much more from ken langone. coming up, we'll talk markets as we head to a break we've look at the premarket movers movers we will be right back. so, the whole world is talking about ai. big, bold promises like... it'll transformace! it's gonna solve unsolvable problems!

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. the stock market, bond markets at this hours, savita subramonian is here, and mike thompson are here, given we're seeing a lot of good economic

numbers, it's just natural i looked at what our people talk to you about, and china is right at the top of both savita, you say the best-case scenario is a minor win for both sides. worst-case scenario is a bad trade war. elairian thinking it probably will be settled with a small win, but he says, what is it a 15% chance, i think, of something major, a sea change in u.s./china relations you don't think at beth it's against. >> for the last 20 years we've had globalization and half the margin expansion you have seen has attributable to open

borders, tax arbitrage, labor arbitrage, just sort of taking advantage of global price dynamics i think that value proposition comes to an end if we reverse that trend. >> with elairian he's leaving the possibility that the up side could be significant, with the trade skirmish with compliance could end up ending 20 or 30 years of really getting the short end of the stick on sblel cricket property and everything else in your view it sounds like it could be really bad, but not that good if we settle for minor -- >> i think at some levels it's a positive. >> it couldn't be a great positive >> i think that one of the risks to u.s. stocks is we have become a global benchmark the s&p 500 is the most global

benchmark in the world, and it's more of a proxy for -- >> what if all tariffs went down, to zero everywhere, that wouldn't be a huge positive? that would be even better for your thesis. >> it would be, but i think that's a pretty unlikely scenario never say never, but i think where we are going now is just -- the motivation for this is really protecting u.s. jobs, i don't know if the way to do that is through, you know, kind of forcing companies to manufacture within the u.s. and charging them more. >> we need to -- i don't know if we'll get away from that thompson, i still think of you as an earnings guy that gives us your projection of earnings growth every quarter, so i want to ask whether things are so good now that we start to worry about costs, margins, things like that, or still just let the good times roll? >> it's the law of numbers,

right? 21% growth -- >> you're going to give me the numbers? >> i guess i should break the habit, and your name is build differently, and i don't even work for that company, but thanks for the brandon you'll see earnings start to get -- just basically the comps will get more difficult. look it's more than that, though. revenue growth is strong as long as you have a good macro economic backdrop which we expect, a measured ten-year rise, you know, there's a lot of good news. i don't know in like 25 years that we've had this kind of environment. look, if you want to talk back to the trade war the market is getting cal louse -- not cal louse, but like everything else it's starting to rationalize this i don't think it'sgoing to be determined any time soon i think the market will do what

it's done for brexit it's going to basically digest it as it goes. this could be years and years in the making the fact is that it plays a bit to the u.s., yeah, u.s. companies could take a hit to margin, because they benefit u.s. companies benefit, but one of the great things, it's really adaptive if they can't get the cost advantage in hype, maybe it makes sense to have more jobs or maybe they go to places like vietnam or other places. that's the beauty of it. the u.s. company is kind of built that way so i think the market is taking it more and more in stride we're trading at 18 -- times next year's earnings, the market gets more edgy once it gets nor of 17.5, and any kind of news can send it in a bit of a tizzy. i think it's hard to call a top

to this market >> it's not overly loved, either. >> once we look at is how we, "wall street journal" strategists, allocating to equities, and strategists are recommending just a builts more than half of the portfolios. despite the fact that we no that interest rates will go up and bonds will do badly, it's really the most tepid allocation we have seen after such a strong run in equities. >> so sad that all the professionals, the only time you use their sentiment is do the opposite the best you can get on wall street and you use them to do the opposite it's terrible. in aggregate >> if all the individuals add up to bearish when they should by bullish whacks does that say >> depressing. >> look at the quality of

earnings, corporate balance sheets we're not going to have the kind of growth we've had the last two years for the next five years, but we'll have good growth for one good reason -- we're solid i think we're in much better shape financially, but i don't see any excesses in balance sheets on the other hand, look at the amount of money that continues to be poured into these alternative investments, private equities this is the late stage, you know, when lbos -- that's what they used to be called when they started out 30 years ago, that was one thing. the market has pretty well picked over, yet money is pouring into it. why? because there's a lot of money around looking for a home, looking for decent rate of return you look at stocks, 2, 2.5%, they're pretty happy, particu r particularly if i can see 6, 7, 9% growth.

that doubles my dividend every eight years, nine years? i think this is what we need to focus on with investors. i assume in both your cases, that's what you got to look at what's the alternative >> savita and mike, thank you langone will be here until 9:00. when we come back, some stocks to watch, including tilray yet thosstks we ocere on fire. we'll see how they are this morning. "squawk box" will be back after "squawk box" will be back after a quick break. make things that think and do automatically. imagine that, a world of new digital products and services all working together for you. can i borrow the car when it's back?

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so they're ready for anything. let's look at a couple stocks shares of thor get hammered -- i get it revenue that it did beat forecasts, about higher costs impacted thor's bottom line. let's get a check on can abyss producer tilray, whose stock was halted for volatility five times

yesterday. up 38% for the dame after jumping 29% on tuesday expected to complete the cuts by march. when we come back, much more from ken langone the toy makers are in trouble following the latest round of tariffs, higher costs on dozens of goods, with little flex abitily, could hurt the sector ahead of the holiday season we have the details straight ahead.

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as investors are calling for change, and one weed company, he will join us live, as the final

hour of "squawk box" begins right now. live from the most powerful city in the world, this is "squawk box." we've had two straight triple-digit days? >> yeah, we did, yes the dow is close to an all-time high, i think. >> treasury yields, 3.06 earlier, let's see where the ten-year is now. the world might stop revolving on its access. we'll keep an eye on it, though.

it could almost feel okay about cash at 280, couldn't you? 280 is a lot better than 30 basis points, and it's manageable. >> but it's not horrible for business people, but tax receipts will go through the roof i understand it's already happening. you get this kind of economy, with these kinds of earnings, i would real have 20% of a billion dollars that so% of 100 million. >> corporate tax receipts are way down, which was the design of the tax cut >> that's only about 11% overall. you've got to do the trajectory. >> i think it's working for itself already. >> was surprised, i expected him to say the opposite. i was surprised to hear him say that >> you know what i would love to see happen right now the republicans to do this

take benefits away from me take benefits away from people like me. >> you've said this for a while. >> a means test. >> however you want you want to do it, you did well, you won big time, you're writing big checks to charities, you're going to have one more charity, the u.s. government and you're giving your share to me it would be a wonderful step forward to addressing the biggest problem of all the, entitlements we cannot deal with deficits. >> every time you says this if ken langone wants to -- but that's not your point. your point is if it happens, it needs to happen en masse the greater good dictates we have to be the first people online to say i won big, what

the hell am i got a check for almost $3,000 a month for? >> when fdr was looking at this, they said you can call it an insurance policy, a forced insurance policy and get away with it, but you can't force an entitlement. something along those lines. >> that was then those are words. the fact of the matter is i'm living far longer -- i'm 83 now. >> 65 was the age people would. >> where 65 came in was when they started with pensions in yurt, in england you didn't live to be 65 they knew they weren't going to have to pay it we're living today -- god bless him, my dad passed away, 99 3/4. sharp to the end we're doing better new deal.

the bidding contest for sky will be decided by auction the uk's takeover panel says the bidding will begin tomorrow with the winner being announced on saturday comcast currently has the highest bit on the table 21st severalry fox is in there jamie dimon speaking out, sitting down for a cnbc exclusive early this morning. >> it's not a trade war. i call it a trade skirmish. >> is it still a skirmish? >> yes, the american government, our president, is right to raise the shy us about china the strategy, i may have used a different strategy, it's unclear where we'll get to, but tariffs on $200 billion, all got passed on to american consumers, they

have to pay another $20 billion. it's a there are 20 trillion economy, so the actual effect is not dramatic there is an effect on the psyche, the mind, if a trade skirmish becomes a war hopefully wee get to resolution its for more of the interview go to cnbc.com. alibaba's jack ma is pulling bund to creating u.s. jobs he blames the ongoing dispute between the u.s. and china he said those jobs would be created for more sales by u.s. businesses on alibaba's eh commerce platforms ylan mui joins us with more on the toys >> i'm hear at crazy aaron's putty world where they make putty. this factory opened just a few minutes ago.

there are about 85 employees at this company, so it's a small business, but its feeling the squeeze from the new tariffs on chinese goods. crazy airplane's has already been hit three times silicone is the main ingredient. the steel and aluminum tariffs, those increased the material they use to package the putty, and now the pigments to turn it into the dinosaur poop and others, it just shows how difficult it is for companies to avoid the trade war when prices are going up across the globe. how much have you seen prices increase >> we've seen a price increase first on steel used in our distinctive metal containers, it will cost u.s. into the six

figures of extra cost, because the amount of domestic supply is not enough to meet demand. they put pressure on other people who may be sourcing internationally. now they all want that u.s. supply you're seeing the same thing with siliciconsilicone >> that started a few weeks ago. it's not going to help. >> reporter: what are you doing some response? >> one of the things we did is looked at the chaos and said we need to stock up, we need to buy material now at a known price waiting for the normal supply chain purchasing times that ties up a lot of capital. >> christmas is coming up. biggest season of the year are you guys going to make it through? illustrates we'll make it through because of those plans in terms of stocking up. that has a cost, but i think we'll do it. i'm very concerned about next year eventually that runs out and we'll have to look at new

prices we have already locked in prices for retailers next year on many of our products. large retailers need to know many months in advance the manualens keep getting tighter and tighter. >> reporter: thank you very much it goes to show how difficult it is for businesses to hide from the pain in this trade war. let's get become to our guest host, ken langone from invedmed and focofounder of hom depot. you are still trying to fund thing in philanthropy. you've involved with education as well. what are you, 50-50? illustrates no, i think about -- i love my portfolio.

>> in invemed? >> home depot, jpmorgan, lily, yum brands i love what they're doing, i like where they're positioned. about 70, 75% of my time is philanthropy the dean and i talk two, three, four times a day. >> in a momenyu? >> did you say three, four, times? >> he and i talk on weekends he's fabless thank god. we were blessed, and then frank and now you've got this guy running this place, you know, i get the bows, but believe me, they do the work i'm at a opponent in my life where frankly, the other

morning, tuesday morning -- and by the way, you want proof that these kids can do good come up to our school in harlem. the woman who runs or program, and jeff, come up. these kids are flying. these kids are home run hitters. it's happening, but you have to spend time, you have to have inspiring teachers big time in the animal medical center, which is a wonderful place, by the way, and i'm having fun doing it, but i still like to mess around with investments. every once in a while i like one of the invest startups to get in trouble so i have something to do this is what i do, and it's okay by the way, frankly, i was terrified my book -- i'm touting

my book, so be warned. i was terrified the book would be a bomb. who would have thunk it? so i gave a tack last night at the italian gun club, and speaking atia h at yahoo, and it read i read a lot we love to watch these -- right now we're in the sixth season of something called "a place call home." so we binge on weekends. we do what every other american does, and i just -- i thank the good lord i've had this life. >> i wish we could figure out charter versus public schools. >> the figuring has been done. >> i know. i hate to admit it, but there's

something to be said that you can't do it all with charters. you've got to fix -- so how do you fix the public school system >> if you're doing something better than me, it's called best practices, right we would love to have the people in public education -- i got to tell you, i'm think that betsy devos is making an incredible effort to try to fix it. whether she's able to do it or not, i don't know, but i can guarantee if they don't get these kids ready for a competitive world, it's going to be very tough. >> i guess that the people that are really anti-charter schools think that the more time that you spend on charter, you're thinking there's a different way than fixing the public schools, so they think it takes your eye off the ball >> why not instead of using a different way, use a better way. look at the city here, look at the results.

what a cruel thing to give a kid a high school diploma appeared say you're a graduate of high school that says you have qualified with all the requirements to be a high school graduate, and the poor kid is struggling to do fifth or sixth grade math or reading. stanley and jeff really got this thing moving they knew the challenges and they knew the ricks, but they also saw the potential and the promise. come up and see our kids see what we're doing look at the number of kids who have graduated and are now in college. >> how many years now? >> i've been involved, i can't remember when i started, but i think the charter school is 15 years old? something like that? we have kids now they're in college, they're completing their college studies. it will work but we all have to have skin in

the game, including -- look it schools should be run for the children not the adults. that's a good start. i'm not going to stay anything more than that, because it's a highly political issue. >> it is >> how do i spend my life? doing what i want and having fun. >> and this is probably the highlight of it, coming on "squawk box," would you say? >> a very important part i love coming here unfortunately nigh nemesis won't show up anymore. he's a no-show, and by the way he's a good guy. that breaks my heart. >> mike? >> no, mike is okay. i'm talking about andrew >> yeah, yeah. >> can i just point out? i lovett capitalism, "new york times" best-seller >> you had a book party? >> yeah. >> i would have liked to be there. >> however you got in, you

busted in -- >> no, no, i don't want to you say it. more from ken langone. >> you got one stop it. when we come back, this morning's big stock movers, including underarmour, let's look at the premarket biggest losers and winners stay tuned you are watching "squawk box" you are watching "squawk box" here on cnbc so they say that ai will put the future in the palm of our hands. that's great. but rig've got your hands full with your global supply chain. okay, france wants 50,000 front fenders by friday. that's why you work with watson. i analyzed thousands of contracts and detected a discrepancy. it works with procurement systems you already use to help speed up distribution without slowing down your team. frank, tell fred full force on those french fenders. fine. fine. fantastic. for ai that knows your industry, choose watson.

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they do. >> it's up way off the lows. now it's kind of regained about half of that you know, obviously one of the big victims. >> despite all the headlines we heard. in cold news, underarmour shares are higher. the apparel maker is cutting about po% of its workforce that is about 400 jobs you see the shares higher in the premarket. coming up millions of chickens killed in hurricane florence, as farmers continue to survey the damage. we'll talk to joe sanderson, ceo of sanderson fmsar, america's third largest poultry producer third largest poultry producer "squawk box" will be right back. i don't know. is she okay? ♪

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the cleanup from hurricane florence is just beginning among the destruction millions of chickens, thousands of pigs died in the storm. joining us is joe sanderson, ceo of the third largest poultry producer has enough time passed that you have a decent idea of the damage or are you still assessing illustrates we are still

assessing, but we have a pretty good grasp of the damage in north carolina we've lost flocks from 74 broiler houses out of 880 total houses in north carolina, appeared that represents about 2.1 million head of chickens normally we'll have about 20 million head on the ground in north carolina at one time >> how many of the 880 -- is that sanderson farms or the total in north carolina >> that's sanderson farms' houses the assessing of the damage, could it get worse from here there's still some recovery efforts that are still only

halfway done are you confident that the worst is behind us now >> i believe so. we've been able to get service trucks and service tanks to almost all the other houses imi'm certain this is the vast majority of our flocks that we've lost we also lost eight breeder houses in addition to the broiler houses, which represents about 10% of our breeder flocks. it was a substantial loss, but it's something that we'll be able to get back joe, ken langone, how are you >> good. how are you? >> how's your golf >> i haven't seen the golf course this summer, i'm sorry to

say. >> joe, how long do you think it will take back to get to normal? assuming you have the receding of the water three, four months >> it will take us probably 90 days we'll be back to normal by january 1. we place chickens every 49 to 60 days on these farms. roads need to dry out. the farms that lost broilers need -- the birds will be composted and the farms will be cleaned out. so by january we'll be back to normal. >> do you think you'll see a spike in any kind because of retail prices? >> we don't know -- it won't be because of the numbers that sanderson lost we do not know the extent of the damage in the rest of north carolina, but i wouldn't think

so we're heading into the time of the year where demand drops anyway people start thinking about turkeys and hams i wouldn't think you would see a big spike in price because of this is hopefully all your employees, not too many are displaced or lost property obviously there's a lot of people that are manning all these chicken farms. are they doing all right, joe? >> thank you for asking about that we know of 25 employees that lived in new bern that have relocated. we're in touch with them fema and the red cross are helping them we're in touch with all of our employees. we have a nurse whose home, the room on her home, we're helping her as well.

so we're in touch with all of those people trying to help them get their lives back together. we have experience with this, with katrina in mississippi back in 2005. >> that's good news. we wish everybody well, joe. thanks for -- >> all thinking of each other. >> thank you. coming up,ome ea sbrking economic news. we'll try to fix it when we return, you're watching "squawk box" on cnbc really want to be there,

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visit pge.com/wildfiresafety welcome back to "squawk box. rick santelli here live on the floor at the cme philly fed index, 22.9, a bit better than expected sequentially double in the mirror, which was 11.9 claims, 201,000, which means down 3,000 boy, welcome back to the 1960s with regard to these really low numbers, and continuing claims 1.645 million. these are really low numbers the market already having a big day. the dollar index down close at

one point. lost the 94 handle, and in the strange world we live in, that's accompanied by pretty strong equity marks, cheaper dollars, emerging markets, maybe the counterbalance to what happen in august on the volatility front it's just ironic how all the other markets look, including interest rates the 3.09 the high intraday right now i have a feeling we're going to test it at some point today. 3.11 is the high-yield close of the year, becky. could be a big day >> just more about what we're watching with the treasury yields pushing higher and higher i think the highest -- you know, what do you think? what happens next? i remember you know, if rates weren't going up, i would be shocked. they need to go up things are looking better, yes, we can always pluck the issues

of the day don't you remember when we had a big magnifying glass looking for green chutes now they're everything it's like jan and the beanstalk. >> you have your boots on again? >> of course i have my boots on, you know what? they're right here. >> will you do that again? put your boot on the neck of the private sector again steve always loves that. that's exactly what happened. >> he loves that you should see the look okay his face when you do that. >> the point is it doesn't matter to me, who is in office, who takes credit for what. all i know at this point in time is there's always going to be global issue, but the u.s. economy is doing pretty well divergence is what we need think about more. go back two years, she was a home run, a winner, our next

president. she woke up and my god, it isn't supposed to be this way. and they're like drug addicts that could get off the drug. this is what's wrong give this president some credit. maybe not as much as he said he's worth it's better, and you can't argue that >> ken, i've said it several times. >> steve liesman is here >> i'm optimistic. >> the president deserves a victory lap. he just goes around the track too many times that's my story. >> i have one observation. he's behaving exactly as he did during the campaign. no different, and he won what does that tell you? >> which is maybe why a majority of americans didn't vote for him. >> oh. >> remember that >> he won. he won, but don't talk about the will of the people here. >> this is good the so he won michigan -- romney didn't win that fla or ohio

this guy won florida, ohio, pennsylvan pennsylvania let new york city and california elect the next president. that's great, steve. >> when you people stop sucking your thumb, come out of the corner -- >> i don't know what you mean by "you people," ken. what does that mean? people on the left liberals big government people? redistrict bugs people >> directly in the center who -- >> he's a centrist -- i supported before anybody was talking about it, i supported cutting the corporate tax rate what i didn't support is the way it raise d and boosting the deficit as much as it did illustrates my taxes went up

that's what centerism is. >> my taxes should go up more. >> you're a centrist, everybody knows that. >> but it's being cast that the little people, of which i consider myself one -- >> one of the little people? >> because that's my beginnings. i will always think of that way. i was one of them. guess what they're better off and we're all better off with a thriving economy. >> i agree with that i think the economy is doing better under trump i've said that 100 times >> history is always clearer when you look back so in a couple years -- >> can i talk about some other news, which is the federal reserve? the president nominating nellie

liang. she's the brookings fellow, also director of the fed board's division of financial stability created by bernanke in 2010, the president once again reaching for the center here when it comes to the federal reserve. >> that's great >> absolutely. guys, skip these probability score, let's got to the wall here i talked to a senior administration official last night. >> the anonymous one >> this person will remain anonymous. whether or not it's the anonymous one -- they're designing this in a pretty well thought out way. powell has a lot of business experience, street experience. rich clarida should take his seat this week, he's what

monetary expert. randy quarles, excellent experience, and then lang, who brings, michelle bouman, a nominee, and marvin is also a macro economic and policy expert, so there's this design around the federal reserve board, which if all these people come, we'll have the full board in a long time one more thing it seems like everybody is happy. maybe not some of the more outspoken fed critics, not what you might call the stanford crowd. but very quickly, i'm impressed with the market for the following reasons. i don't anything about the market -- three things one is that this trade stuff which the market has always

hated. two, rates of higher and three, the other full screen i wanted to bring up, which is the probabilities. if you look at the fed outlook, 100% chance for september, 56% for the first of 2019 and then we're looking at the possibility of a second rate hike, which is now july >> that's pretty steady. >> it's a bit higher i think march is now at or near the contract i'm just looking at the market, spitting in the face, whatever the right metaphor is of these particular headwinds saying, we want to go higher despite this stuff. >> i think it's making its peace, both on the stock markets are making peace with that i think the bulls still want to pause next year. >> i think it's good get those rates up we have to start fixing something that's impacting all of us. look at the pension funds. they need some relief or the

actuarial numbers -- chicago, for instance, is in tough, tough shape because of its pensions. >> it's not just chicago this is a problem that is -- >> look, they can handle another 25, 25 and 25. >> i think that the economy is tra strong, and i think it's strong with the underlying growth, but there will be adjustment and there will be pain there are guys who have had their head in the sand eamericaning markets one of them. >> or their thumbs in the mouth. >> you want to get rid of the electoral college? >> i don't, joe. i want a president who won the way he did should govern more from the center. even in fact those margins in some of those red states are extreme, and -- >> so he should be more like

president obama, bringing in the right and -- >> no, it makes no sense. >> a guy who runs -- >> go ahead, ken. >> the way he did -- >> you pray at the feet of facts, right >> i think that's right. >> i think you're right. look at a map of the counties in america that are red and that are blue. >> democrats like water. i know that. >> the biggest mistake is we're not making, trump is the fever the disease is the apriler and frustration and disappointment of the american people in their leaders. this is what's wrong we've got to fix it. we've got to get people with new faith in their elected officials and electioned officials have to have the guts to make decisions. china has been a problem for 25 or 30 years, and what do we do democrats appeared republicans alike, kick it down the road. >> i give you the last word, ken.

i love talking to you, ken >> thank you >> i think you're more in the middle than i give you credit for >> i don't think so. >> how can you bring up it wasn't a legitimate election -- >> that's not what i said at all. we'll continue this conversation coming back we'll have an activist investor llcaing on one pot company to make a deal or face a competitive disadvantage. face a competitive disadvantage. "squawk box" will be right back. these pursuits may seem unnecessary. but the scariest thing i can imagine is a world where this, doesn't exist.

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pot stocks might be on fire recently, but our nest guest says one canadian stock isn't going high enough. they says that hexo needs to explore strategic options. it's great to see you. >> thanks for having me on. >> >> we've been talking about some specifically on fire yesterday. people are say this is too much too soon why do you think that hexo is different is because of the valuation gap. when we wrote the her about two weeks ago. hexo was trading on about eight times ebitda today it's on 12 times, but the sector is on 40 times, so the gap has widened.

>> why was the gap there to begin with i want a couple things one, there's no u.s. listing secondly they have done a poor effort at investor relation, where is a lot of the stuff you see today is a lot. >> i would argue that's definitely the case. i'm not sure that's a good thing, though. why do you think that hexo should be part of it. >> what we're saying is you have a company trading at half the multiple and it's an industry that will need capital it's at a huge disadvantage for investors today like ourselves if hexo issues capital at 12

times ebitda it's in their best interesting to pursue a sale or a merger with one of their competitors. that way you can monetize right away. >> have the stocks that you're benchmarking got to such a height that a strategic investor would not buy them at that left? in other words, do they have capital at those levels? so someone can afford to pay 100% premium and still have it be accretive from year one in my career, i have rarely seen that hexo has about 400 million of cash sitting on its balance sheet today. they gets the hands on that

cash that might be way more powerful than raising equity. >> i think in november we should get a u.s. listing they need to be way more proactive. >> what does that mean just the ceo being out there in you look at these other companies, you know, they're waving the flag every single day in the market, so we have given them four options. but they have to do something. they cannot stand alone today and not do anything. >> how much do you own >> we are the second larger share in the company we don't disclose the exact. >> it's not 5%. >> not 5%, no, you need a% to basically force a proxy or agm, but we're confident that other shareholders are thinking alike.

it's mathematics, not more than that. >> is there anything proprietary in a lot of these businesses is it basically a commodity business >> it's a brand. it's not production. so who is able to build a brand? hexo, apart from canopy, is the only company that has a partner. canopy has constellation brands. so there's way too big of a gap there to explain. >> ken >> it's only 10, 15 years ago there was a massive wave by state pension funds, for example that you had to get out of any stock that was involved in to bako, right? i'm thinking as a very long-term investor, where does this wave hit where people wake up appeared say, wait a minute, what is the difference in this business verse the tobacco

difference tell me the difference and i think reason eventually does over the long term prevail. i can't participate in this discussion, because i wouldn't own any of them. in fact if i had a wish like i felt about the tobacco stocks, i wish they would all go broke when you go to a hospital and see something dying of lung cancer, who you knew was a three packs a day smoker there are drawbacks, which i think you would agree with >> i don't disagree, but we're just focused on this particular company. >> i know. people invest with you >> or identify a situation like this, which we think is incredibly unique. i haven't seen this type of diverse evaluation gap before. >> take the business aspect out of it. it's numbers you are looking at.

>> all i'm saying is at what point does reason and history kick in to make us ask ourselves a question, what the hell are we doing? khalel, thank you for joining us today. >> thank you. the ceo of cap pit grown will join us tomorrow. when we jim cramer, you're watching "squawk box" on cnbc.

jim cramer joins us now. another triple-digit day you haven't been behind the curve on this, my friend. >> i have liked the market, and look, jamie said a lot of important things one of the things he talked about was the $20 trillion economy and how we should recognize this is really not that bad, they tariffs you have been obviously it goes to 25%, still it's $1,000 per person >> i think the fear is

diminishes, you put a number on things, and there aren't that many, because they've got so vicious, that you come down and say it will be okay. and then lower i think that's part of what people are quantifies. >> right >> i agree. >> jim, how are you, my friend >> ken, i'm great. >> its couldn't be better. it's a good life. >> what book do you think is on my wife's bedstand >> you're kidding? >> a lot of it is because -- >> assure her everything we make goes including my scholarship program at bucknell. >> i can't wait to tell her. she works on it every day. she work on bucknell every day,

one of the very important committees, and we're grateful for her work. >> thank you appreciate it. >> big win and i was watching it streaming. it was pretty good. thanks, jim. see you in a couple minutes, and see you in a couple minutes, and then on "mad money",t this. david farr >> good guy. >> good guy. stay tuned well, you're asking the right questions. i just want to know, am i gonna be okay? i know people who specialize in "am i going to be okay."

i like that.

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grandpa duck! woah! ha! there you go grandpa. keep doing that. get ready, because we're helping leading companies lead with digital. time for your stat of the day. amazon haus fallen after similar drops, it tends to bounce back, outperforming two weeks later. ken, we have about a minute and a half before we leave what do you think about the markets? >> first of all, i disagree with the president? one respect -- america was, is and always will be great okay that's a good start. i think we all in the next 25 years, notwithstanding all the noise with tariffs, i think or market's in good shape

i worry about the deficit, we have to address it at some point. we have big issues to deal with, entitlements, guys like me, start with us. still i can't think of a pace where i would want more exposure than the united states of america. >> you disagree with andrew cuomo? >> i like andrew why did his grandparents come to america? we were great. >> i like when you say i'll stop lying when you stop. i remember we are the greatest nation on the earth. we will deal with our problems in the future as we have in the past we have some issues, the immigration issues are serious, and it's got to be dealt with. somewhere in the middle you'll have a solution. overall i am excited

i'm terribly, terribly disappointed at the horrible treatment that this fine man kav amount naugh has been treated. >> love being with you. next time andrew might be here ♪ good thursday morning. we're 211 points from a record futures indicate we could get almost in the ballpark plenty to watch, including new comments on trade out of china the cannabis craze continues europe is green, and the