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

ten-year near 309, as claims down again, and the the tweets about oil at 71. our road map begins with trade fears easing, stocks set to open sharply higher. >> plus amazon's next products, the e-commerce jean revealing it will have an event with big changes. and tilray set to rally again at the open after the wile session yesterday and overnight. and after the transports a cup the weeks ago we may get industrials playing along. >> there's a note by baird, which i think is a met a forfor what's happening barely mention iing u i wore pie

boeing tie because it could break out here, one out of four planes do go to and that could shift. so i think there's a sense, let's quantify these tariffs, and when we do that, they're not as bad as we think that's really the theme running for today. >> pnc had numbers yesterday even if you took 10% on 200 billion, 20 billion, even if that were all passed on to consumers, it's 15 base point of 14 trillion. >> that's right. i did -- i did some numbers, and i'm doing 25%. and it comes to $1,000 per person, if you -- per household. sorry. right now the tax cut gave people 1600 per household, so the net good 600 these numbers are obviously rough. what they do is try once again,

if everybody continues to buy from china we're going to talk amazon later it has a suitcase that they're unveiling which is less than 50 bucks. the same thing you can get from samsonite, but double the price. they're moving to make things other places, and then there's amazon the amazon factor does keep prices down. >> though there is another part to this. i was talking to the kreismt ohm. they sell into the home, fairly significant. they manufacture both here and in mexico. what is interesting is because what will be sent from china to mexico will not be under tariff this ceo is thinking about downsizing manufacturing in the u.s. to mexico because of the tariffs ufrts not to mention jack ma and his broken promise today illustrates a million jobs, he should have been

further along in the process >> of course he had kind of promised lop term was about empowering small businesses here in this country that smell through the alibaba, and that was a pretty long-term and ambitious goal, but it no longer exists. >> but david is right in terms of -- remember martin franklin, who used to run jarreden it was to make it mexico, i think a lot of factories have. >> the idea is to create jobs in the united states and/or keep them this is one anecdotal point, but not insignificant. it's not going to necessarily work also price increases, is another conversation that so many ceos are having now if you make something with components, whether it's plastic

or any number of things that need to be assembled, your price is going up potential 10%. >> i don't disagree >> how much do you take from your own margin and how much do you pass along >> this is why 232 is in vogue for steel worldwide, because the idea was the chinese -- we import very little steel from china, in part because china uses every sippingle market to dump steel in our country, including mexico, turkey, a lot of european companies, so that's why they put it on everywhere. china is so clever about dumping in our country i agree that you have to have a more aggressive plan if you're going to stop china, but i also think, david, you don't want to open new factories in china. you want to open new factories in mexico irs that's true illustrates i want to see the details of the new mexican nafta, because i think you would be a -- i've had david farr on tonight from emerson, he's the head of the council for these

manufacturers. by the way, he's got maybe one of the biggest presence in china, and he's long been in china, just opened a research center in hype president i've got to ask him i think what's happening is we have many ramifications, but i still keep saying more if the president gets a concession would be really amazing for our country. particularly on the things that we care about the joint ventures. >> intellectual properties itch there's a theory called the transfer tariff put, which argues if our markets were to swoon the way shanghai's have, the president would quickly moderate his position. do you think that's legitimate >> i think the president is listening to peter navarro, appeared peter's view has always been the same, the stock market will take a dip and that's okay, because the economy is so strong we can absorb it i find that -- as being -- i

think it's one view. i don't think that's the view of the hard line, and i think the president is very much listening to the hard line. >> interesting jim mentioned amazon we are going to talk about it today. aditi roy has news in seattle. >> reporter: hi there, carl. later on today amazon plans on holden an event related to amazon devices and alexa that's what we know officially earlier in the week cnbc did report that amazon plans on coming out with eight new alexa-powered devices by the end of the year ranging from a microwave oven to an in-car gadget what could such an expansion mean for starters, it mean many more users coming into the ecosystem. it's also about alexa moving into your kitchen or your car. jeff bezos has said he wants customers to use alexa wherever they are and bringing mower customers into the tent and connecting them increases

amazon's potential to disrupt google's search. they already have been do that, but the company is also under pressure in the smart speaker category we'll find out in just a few hours how amazon plans to meet that threat from google >> aditi, thank you very much. is just thinking what a week it's been. number three in digital ads. reports yesterday about 3,000 cashier-less stores? >> i do want to correct something, emerson did cancel yesterday, they will not be on tonight. my bad i think there's a good article that's something that david talked about.

>> they're just doing the early stage sort of survey of whether or not how amazon uses data on the platform to figure out what is selling, and then as you say, potentially replicate it it's worth taking that risk, because when you use amazon, you're going to basically be available to everybody in the world, or at least many of them. if you do really well, there's a chance that some believe will use the data to compete against you. >> i think your gross margins are under attack there really, though, another platform >> it's important to point out while this is the early stage survey work and there's no probe under way in the eu, they are doing the work and she's been the leader in terms of antitrust. >> why is she taking so long in

its these things take time this is something that gary kuhn talked about a couple years ago, how the digitization has kept prices lower, which is an interesting offset to what china does, and again why i think the consumers will feel a bump, as manufacturing leaves china, could be through mexico or other places that's where it's going. those are countries that are ready, but it's still heart to put up a factory you can't put up a factory overnight. we want to get to tilray in the a-block today. volatile today, a day after big swings fife times yesterday.

the ipo was 9 on days ago for i had brendan kennedy on tuesday, he's the ceo, the executive chairman of a privateer. the ---ed brand are from privateer, which is a private company, controlled by peter theel. >> i suggested it was -- i talked to a company at the green market report, and he didn't say that he said, listen, 150 billion, in other words i said 500 billion -- only 10 million shares are outstanding that can trade. there's 7 million total. he did not deny like in the prospectus that he needs to raise capital. remember they have, what, 200

million versus canopy with 6 billion form there's a lot of people who feel he is stoking it illustrates you could say theoretically -- >> what do you tell people, though, it's for those of us in the late '90s, it's somewhat reminisce president of a handful of those names that were just going up every day, in part because, of course, we had this huge moment of change that we knew was coming. >> you can't short it. you have a 22 billion company. they have a tie-in novartis, santos canada. that's a realistic tie-in, 9 million in revenues this quarter -- >> you think it's going to grow into this -- >> no, it's not. and it's now half of that under

the circumstances which is -- >> it's insane, by the way, october 17th, nobody in canada is even ready. it's important for people to recognize it's being trying i had by investors, stoke by no means what solve, by a piece that was wring on september 12th saying this thing is way overvalued vote it tripled, so blame the retail investors kennedy was not promotional on "mad money." i said three times are you going to raise money three times he said we do need money to compete that's not like the dot-comes, but the investors are trading it people can pile on to me, but boy, i egged this guy on, and he

wouldn't go there. when we come back, new developments on comcast/fog battle for sky the dow will get close, and then a lot of research on government e, viacom. stitchfix, micron, in a moment obvious. sometimes, they just drop in. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group - how the world advances. ♪

well, we're going to have an auction, whether it results from a higher price to sky than our remains unclear, but the uk making it clear that our time here tomorrow, they'll begin an aucti auction.

very important, remember that disney really controls what happens here this all started 1075 that fox had to buy the remains that it didn't over. now we are -- the question, will disney allow fox, which does want to, from what i understand, come with a higher offer i think it was the 13th of july, where disney added that last bit of a sentence that said they need debt financing and need our approval, and we might not give it for more or less that's what they want. and -- maybe they will elect to

provide it i have not gotten a good idea of it it did not seem likely that disney was interested in going higher, but my understanding is rupert murdoch has been working on it and working on bob iger to potentially think about going higher, and we will see many say house of representatives higher would our parent company comcast go 1550 as high as 16? some people say 16 is a crazy number people tell me we're already close to crazy-land. talking about mid single digits grower it doesn't mean there isn't a desire to own it remember, the 39% that fox owns will increase in value the

question is would they tend are into any offering, if they didn't comcast still has -- they would opt be dealing with 61% of the stock out there. saturday we should know the winner. >> disney balance sheet if they win? >> it has it, but you can make the argument they would benefit greatly once they close the fox deal at a significant premium. that's my point form it's a win-win. why would someone sacrifice a win out of, what, spite? >> comcast, our parent, made disney pay up how much more? so maybe a bit of retribution, i'll make them pay up a bit, at least something i want there's a

note out today about comcast and broadband, and how well broadband is doing, so i rei wait something that brian roberts said two weeks ago ed stogs hag goodsle have are going up very nicely i would be shocked if -- where comcast gets it. i can't be wrong i know -- i think you're in the camp that is the majority. comcast will find a way to own it, but of course they don't want to see it go to a crazy price. i know we've got to go to break, but the 5g threat is overblown, which is a principal objection why to own comcast we'll get the opening bell in a couple moments, a look at the premarket as the dow is up,

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or more on car insurance. six minutes before trading we missed the hump day darden is something you want to talk about in the mad dash >> this stock was all the way down to the 80s, but one of my absolute favorite ceos, remember it was a restructuring ordered by starboard really puts up fantastic numbers, and 5.3 growth, same store at olive garden.

the says. >> this is radio discretion year spend stock. she thinking it's cheesy, appeared the darn salad? david, endless salad bowl, and the pasta, the fettucine, to die for. >> that's darden for the day we also want to come back to tilray, some amazing stats on what it costs to even try to

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seconds. a lot working for the bulls today, as we look at a potential record high, the dow getting even closer. data looks good, philly fed and claims, as we had, 201,000 for the week, dollar lowest against the euro since july, a lot of bullish commentary including the cat upgrade. >> the dollar is very good news. oracle reported the order day, talking about how a strong dollar has hurt them if that dollars keeps the trajectory that you mentioned, it is going to be able to say, listen, you can raise numbers. >> the other element for the upgrade is a lot of businesses are not late cycle yell in their view. >> yes

that was a very bullish piece. the stock is cheap because the multiples have been compressed, because people believe that china will hurt them there's the opening bell at the big board today it is nasdaq, tlc honoring advocates who work to prevent bullying b you have a says they'll hang in there. >> if that happens, the stock will be much more. it sells for about 3 1/2 times

earnings there is going to be a gigantic buyba buyback. >> micron, the second biggest gainer behind darden, right along there with amd , and some other, too i think the people are reading through there five times earnings i don't want to stoke this thing. i think that track -- but i just think that while amd's numbers are very real, the stock is

parabolic. i really believe in the company. >> it's worth mentioning ipos, we also have a -- that's been off on lily. number three in cattle, and apparently 20 times over subscribed and many of them are also holding other for lily >> i've got to tell you, i have loved this area. if it goes at the price, it's going to go substantially higher the boutique that these are all competitors, even higher than that this is a gift by lily, a gift. >> a gift at where it's priced

first time since january 26, old record 26, 616, and just surpassed that by about 20 points, so now records for the transports in recent weeks, s&p again today, and now the dow. >> a lot of anticipation for some great earnings, a lot of it all about some tech stocks that are really moving, and yet the big value with jpmorgan, the val value. >> that's one of the -- those two groups are so far behind, and the caterpillar money is really that is the story for today's rally. >> caterpillar money is the story? >> machinery, into the stocks

that would. >> citi was so far behind record 119 and change, why the disparity. >> his bank can make a lot more money than just trading revenue, which is what -- make a lot more than morgan stanley, the number of cuts today, which is a fee-based business, that jpmorgan has made so much more money when they open the doors i would contend that bank of america is a close number two, but we're talking about next week's fed if you raise the rates and adopt raise how much you pay your depositors, it's a huge win. i was looking at how much i get on my cash balance

it's pathetic, frankly. >> a little pathetic it's more than a little pathetic it's motivation for not keeping your money there >> well, when you put your money if tilray and bitcoin? >> yeah. you spread your money around the world in the form of -- >> but it's in real estate that's done by my wife who is in real estate. that's her business. >> we all benefit from that. >> we rent out our places. >> we have places to go. >> the president just tweeted -- s&p 500 hits all-time high congratulations usa. he hit the button just before the dow hit it. >> i'm glad he's focussed on the s&p? >> as opposed to the dow >> thank you acr acronistic -- >> do you think he's going to recommend -- >> good job focusing on the s&p. >> did you hear what he just

did? total endorsement for the president of the united states second one in the same week. you have come around to whatever -- not my view, but the view. let's talk more about tilray, recreational marijuana, but perhaps you have to be smoking a lot of it to think about shorting this stock. >> you mean reefer madness >> by the way, yes, something points out, it's not heart to short it, but they're selling calls. what i'm talking about is borrows shares to actually short the stock in the traditional manner they're going to chart you 800%. something tell me you would have to have the stock fall by more that -- to even just break even. hence, very, very difficult to actually want to short this, jim, when the lenders are going

to charge you 800% to borrow the shares how much would they be down here >> 7 % -- >> so there's not a big flux. it's literally almost the size of what could be made this year. >> by the way, when oregon grew, when oregon went legal, prices fell through the floor they will do it again here >> oregon is a good case study

of what happens to profits >> it was cut in half. if you look at all pot stocks that are coming into america, and you look at how much is being -- no one in other thought when they were ripping up the pinot noir vines and planting pot -- but my daughter lives in oregon it smells just driving interstate 5 that's how much pot was planted. be careful the plethorale stocks coming public and the amount of cannabis being planted, look out, prices are going to go through the floor after some quality issues at power.

the power division is going to get hurt because of a blade failure. it's basically a disaster. there's 9 billion of contract assets sitting on the balance sheet, but they do great work. on what they argue i love how the title of the report is there's a first time

for everything i think it's worth more than cbs. i know that's a contrary view. if you haven't watched, i don't know what the heck you're doing, but i do thing what's happened is it's been revolutionized. a lot of friends of mine blown out there. i think people will have to recognize that viacom is -- >> stitchfix, we've talked about this basket of stocks that have been not toppled by amazon piper does cut it to neutral, as they argue competition from amazon will intensify. >> when you have a stock that red-hot, unlike roku, people

want to make valuation claims, and i just find that you can't sell on a value ways claim and necessarily think you're going to be right. stitchfix is incredibly well run, as well as roku if everything goes perfectly for stitchfix, it's not overvalued it's got to go perfectly. >> >> if there is a trade war, maybe not. >> well, work, i looked for tepper, love him dearly. he caught me a lot of lessons, but look, i've been following stitchfix and recommending it on "mad money." if you look at nvidia, that is priced for perfection. listen, be careful, but if you read the whole report, it's actually not that negative they're say priced for perfection if things are priced for

perfection, they will come under pressure, because a lot of analysts say i want to ring the register i don't mean tore equivocating, but these are not dot-comes, they're really well-run companies. why is the market rallies in the face of higher yields? >> the last group that led the rally were the financials. i think they can continue to -- ahead of what is beginning of reporting season i know wells fargo, obviously burdened by different issues involving their lawsuits, wells fargo having an excellent quarter. i know that jpmorgan is having an excellent quarter i do think this group has come on fire again after being hit by a downgrade of suntrust recently, which was really about, as we know, low growth

slowing. some of it is just because the economy is so strong, but day you have darden you have a tremendous belief, morgan stanley piece about apple sales in china very meaningful you have oil up. that group has lagged. so you do have value, value, value advancing. it matters >> all getting put together. >> you know what's viewed as a value stock, which is hysterical facebook. >> i kind of had a feeling you were going to say that i want it's on fire. >> we have a dow record once again. let's get to bertha coombs. >> been an interesting move higher, also interesting this morning, the president noting the record high in the s&p this morning. datatrek put out what a lot of investors have believed, the

market this some ways is the trump put on tariffs if the market responds positively, they will continue, but if the market starts to take a downturn that likely the administration will pull back on the rhetoric and pull back on pushing forward. jim talk about financials strong again. financials have really been what have been leading this let of the market higher of late. they felt into what was called the death cross, you saw it fall beloaned the 200-day moving average, and this week they're coming back around so a lot of folks bullish, and the financials now can push this

market to the next like higher, as some of the other leaders, like tech, have come back and fallen behind. among the areas that have also seen some changes and purring back are the short caps. the russell 2000 is on pace right now to snap a six-month winning streak it had been a bit of a safe -- as the receipt ricks had heated up, but now it's moving lower. that's part of the reason we are also seeing a drag on the nat dak. that has been where we have seen some weakness of late. >> that's contributed to some of the sectors. the nasdaq, small tech, iotech have been move the worth performers, even more so than -- that said, we do have a tech ipo

today. off 10 million shares at $23 a share. expect it to open later this morning, and also the ceo on later this morning on "squawk alley. rick san telle is at the cme i want lest we all forget that we most likely -- to the 75 basis points for the year. '08 included 3%. we've hit 309 twice. do remember that 311s are high

closing yield. obviously get close. i really enjoy watching it po 24, as you see on this chart, twice we have hit it in we note the short emis always thinking about it >> it probably won't get jay paul and company thinking they're going to hurt the -- if you look at what's going on in bund, there's obviously a big spread there if instead we go through 311, i would find it heart to believe we won't shoot think -- finally, the dollar index, it is really

taking it heart today, though it's bounced about a quarter percent off the lows what's interesting here is if we don't hold this 93 even area on a closing basis, that is huge in the grand scheme of if you're looking for lower dollar index prices back to you. >> rick, thank you very much fascinating day at work here, as we said earlier, first dow record since january 26th, though we have settled just below that level dow, dupont, mx and more, back in a minute.

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dow 30 heat map. almost every component is in the green led by caterpillar and dow dupont the only two that are red are largely domestic, home depot and walmart, although walmart to a lesser extent. >> the retail and the restaurant retail i think going down because people are saying you know what?

there's going to be someone who has to eat some of these tariffs and it will be the retailers at the same time, we got the jobless number today and that indicates, hey, look it remains incredibly easy to get a job in the country. obviously that's geographic. but that does matter you get a job, you spend more. >> claims number today if you missed it, 201 a 48-year low. the last time claims had a one handle, november of '69 at 197 so that's -- >> that's the guns-and-butter strategy that johnson put in place that nixon followed up on. very inflationary back then. this is not inflationary. >> all right, not inflationary 10 years at 3.08. >> well, look at the numbers now. >> we're on the cusp of a productivity boomlet than that changes everything. >> it's a pretty good time

i'd love to say don't buy stocks but i would like to say don't buy tilray, please don't bye it. you're going to make money short term. >> stop buying it. t hippocratic oath. nohypocritical. >> from stop buying to stop trading. we'll get that with jim after a we'll get that with jim after a break.st network that would eventually become verizon's. back then, the idea of a nationwide wireless network was completely unreasonable. but think about how important that first call was to our lives. it opened the door to the billions of mobile calls that we've all made in the last 34 years. sometimes being first means being unreasonable. i'm proud i was part of that first call, and i'm proud that i'm here now as we build america's first and only 5g ultra wideband network with unprecedented wireless capacity

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time for jim and stop trading. >> i've been saying value tech is moving up but growth tech, no red hat talked about one deal that did not renew is a legacy one premised provider based on pricing. so you on board the cloud and they're talking about price pressure so people are scared of tech because of that comment the company can come back but this was a series of gown grades we've got. jim whitehurst confirmed there was pricing pressure driving the stock lower. >> what's on "mad" tonight >> i've got corbus they have a cannabis drug. this is the problem with people buying tilray. competition. please, please, understand it's supply and demand. >> supply-and-demand stock not enough stock and too much cannabis coming. david, i know these things, i

know whereof i speak. >> you've been talking about it for a while. >> i've been positive until today. >> jim, see you tonight, "mad money," 6:00 p.m a lot more on a record-setting day for stocks when we continue. ♪

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. welcome back to "squawk on the street," i'm carl quintinilla with sara eisen and david faber. record highs for the s&p and the dow. but first, more data, let's get to rick santelli. >> we have our august read on leading economic indicators and, of course, it's not out yet -- there it is. up 0.4%, close to expectations we were expecting up 0.5%. keep in mind it follows up 0.6% that was not revised, the second best number of the year. january was the best number up 0.7% there's going to be a lot of talking about january think stocks sara, back to you. >> breaking out of the january highs on the dow thanks. existing home sales are out this hour. let's get to diana olick for that. >> existing home sales in august

unchanged in a seasonally adjusted annualized rate of 5. 34 million units and july's numbers were not revised that's a slight miss the street was looking for a gain to 5.38 million sales down 1.5% year over year but sales have been falling four straight month so to see it unchanged is good. home sales up 2.7% year over year to 1.92 million units available for sale at the end of august that's the first annual increase in supply in over three years. that's good news for prices, we need more supply prices up 4.6% year over year. the median price of an existing home, $264,800 but gains are decreasing we had seen price gains of 6%, 7%, 8%, now we're in the 4% range. that should make it easier for some buyers to get in at that price range.

we're seeing sales drop on the lower end of the market. homes priced above a million dollaring are soaring up 12%, but that's barely 3% of the market so sales unchanged in august but we are seeing a much-needed increase in supply back to you. >> diana, thank you. watching the market. dow up more than 200 points, setting its first record high since january. s&p 500 at a record this morning. the president just tweeting, s&p hits all time high, congratulations usa. let's bring in pimco executive vice president at post nine also with us the wells fargo global equity and technical strategist. how would you characterize the big driver behind the breakout that we are seeing in stocks >> well, markets claim to worry about something and this was the tariff story for some time markets worried about tariffs and the impact on

sentiment, particularly corporate sentiment but there doesn't seem to have been meaningful impact. last week small business owners reaching the highest level of positive sentiment in 40 years of surveying they said the amount of people they intend to higher is the most ever so market sentiment changed and it should have because tariffs amount to about 0.4% of world gdp. mine skul in the larger scheme of things so markets have been able to shrug it off because the u.s. economy is service oriented. >> the new round of $200 billion of chinese imports, you zemin mall impact? >> it's a 0.4% impact. growth potential, how fast kgb go without generating inflation somewhere in the high ones so it's okay to the investor that you might take a small hit because it could help prolong ax

panks. but growth is strong relative to potential, global gdp still looking good and not much in the way to stop it. >> i've heard two arguments when it comes to why the market has shrugged off the trade skirmish or war one is tony's, that it's a small amount of our gdp and it's growing nicely anyway. the argument i'm hearing and i'm wondering your take is that the market is backing up the president's trade strategy and is looking ahead to winning some of these trade fights and making an overall better economic environment and trading environment for u.s. companies. >> yeah. investors are doing their home work they will have an impact on certain industries, certain companies but when you step back and look at things from a macro standpoint, the economy is doing well you have fiscal spending, you have tax cuts making their way through the system you have companies doing a good job of maintaining margins so when you think about how to

allocate your assets looking at stocks versus bonds versus cash. it's an attractive environment to be in stocks. >> the u.s. dollar is falling pretty hard. that has to be a driver behind better sentiment that the strong dollar is becoming a pain point. >> maybe but when you say strong it's in the context of previous weakness when you look at the current level of the dollar using federal reserve data it's equal to its five-year average so it hasn't gone anywhere it's odd it isn't stronger given that the federal reserve is keeping policy rates near zero the european central bank and the bank of japan so the dollar probably not a major influence. >> where do you think it's headed >> well, we'd say we're more or less neutral it's possible if not probable the federal reserve will raise interest rates more than markets. in fact, the bond market will have a major decision point in the next year to figure out whether the believe it's had for

three years, that the fed will end policy rate hikes at 2.75% is correct if it's wrong, you should expect yields will be higher across the yield curve. probably stay in the low 3s or so depending on the where funds rate go. in 2006 they decided to keep in the the low fours. the market changed its mind and the fed raised its rates to 5.25%. something like that probably will happen again where the market reexamines what it thinks on the policy. what i'm saying is nothing frightening for credit equity investors. we're not looking at a meaningfully higher policy rate. the policy rate will probably go no higher than maybe three and a half but -- >> but you think the market will reckon with a higher rate than they expect now? >> there's a decision point

coming because we're getting there. the policy rate will be where the market has been expecting it to go in the next year, 2.75%. >> sameer, there's a fed meeting next week. what's your view as to how much is priced in this year and next year and how much the equity market can swallow when it comes to higher rates? >> september is baked in and december seems to be a tossup. we think they'll probably do one more for no other ran that that's what the expectations of the start of the year were they'll go three times next year so four times in the next 12 months and as long as growth stays on this trajectory, we don't think that's enough to derail the equity markets. >> do you expect growth to stay on this trajectory there is a big debate about whether we've seen the peak when it comes to the deregulation and front loading of the policy from washington. >> we think growth will peak globally but we've not talking

about a problem. global gdp was about 3.3% this year, 3.3% last year, u.s. growth high twos so whereas there was global synchronous growth last year but the u.s. will hold up because of tax cuts and deregulation but in 2020 is where there's a wile e. coyote moment where there's a fiscal cliff and also the lag effect of monetary policy collide in 2020. it will be a political debate whether to stop the fiscal cliff or not. >> finally, some meants at the yahoo summit saying the u.s. has decoupled from the rest of the world. we've been around the block on a couple times can that continue? for how long >> we would say we are at a peak

in terms of the divergence between the u.s. and the rest of the world and we would be as contrarians taking the other side not that the u.s. will slow but the rest of the world will catch up because the u.s. tends to lead so we like commodities, emerging market equities and debt in dollars. >> guys, thank you very much record highs on the dow and s&p. when we come back. fox and comcast, the $35 billion takeover battle for sky is coming to a head this weekend. we'll get details on what will be a one-day auction plus amazon's big reveal holding an event this afternoon related to its devices and alexa a look at what the speaker wars could mean for the future of that company dow hanging in at the levels we set in january round 26.16. "squawk on the street" is back in a moment. [ upbeat music playing ]

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tools, connections. high-speed connections. is the world ready for me? through internet essentials, comcast has connected more than six-million low-income people to low-cost, high-speed internet at home. i'm trying to do some homework here. so they're ready for anything. welcome back by the end of the weekend we will know who the winner 1 in that very competitive battle to own british broadcaster content and distribution company sky of course 39% of the company already owned by fox but remembered the a deal to acquire the 61% it didn't own for 1075 and then was bested by our parent company comcast at 1250 then fox going up and comcast at currently 14.75 so there's been a back-and-forth that will now

be concluded beginning tomorrow when the uk takeover panel overseeing this back and forth has made it official that it will make a decision based on an auction process they've set out for us 12:00 tomorrow our time. that's the deadline. if you want to meet -- conceivably either side could come out with a higher offer now butter wise they go to auction and it ends saturday evening we should have a winner fox will bid first given it's the lower bid, comcast will have an opportunity to come back and they go to a final round three rounds of bidding, you see it right there the question is how high will either side go you can see where shares of sky are right now. well above the current bid from comcast and many would say at a level maybe a bit higher than is likely but our parent company comcast

sees a great deal of opportunity strategically in the asset to create more of an international business and it's not a distributor. they own important content as well and for its part disney sees in the a similar way. important markets they will be able to access yes, the multiples are high but reason, what is it going to mean strategically? will there be a back and forth will it result in a far higher bid than the 1475? that seems unclear at this point. rupert murdoch and fox who are the ones making the bid but need permission from disney to do so so in many ways while they are making the bid it is bob iger's decision as to whether to do it. they've been pushing for it at fox, they like the asset at disney but i have no guidance for people when it comes to the price we may end up at and how

much higher if any it will be than where we are right now. >> hollywood reporter has a great interview with iger talking about budgeting for content versus netflix, his relationship with murdoch, the way he admits he overshot on the expansion of the "star wars" franchi franchise. >> listen, the transformation of disney to a direct-to-consumer company in many ways is going to be the most significant thing that occurs executing it properly will be the thing it's judged by from the investment perspective so it is an important time as they work to close the fox deal, integrate the assets and make their final decision on sky. >> we'll see what happens. >> if they have 3% of sky and it's valued at a higher level it's still a benefit

then there's the 30% of hulu that come cost owns and 1 there something they could do there as well so more to come but we'll at least have an answer saturday. >> news in your world, news in mine as well i'm watching nike and under armour today nike shareholders are meeting in beaverton. drama around the call to make colin kaepernick the voice and face of its just do it ad campaign and you have the internal corporate culture scandal that led to the departure of 11 executives in the past year, including the number two and widely believed successor to ceo mark parker bottom line, a lot of noise, neither issue likely to create shareholder uprising why? look at the stock price. up 37% outperforming under armour, most retailers and the rest of the dow jones industrial average. shareholders are happy and investors have shrugged off the changes as noise because the company has repeatedly put out

strong results globally and a recent turn around in its key market of north america. as for the kaepernick controversy, i can share new data sales online jumping 27% between sunday and wednesday of labor day weekend after the ad was released online. 5 huge increase from last year but since then sales have leveled off to the same pre-campaign rate. the jumps occurred in maryland, new jersey, alaska, delaware and massachusetts. most of them left-leaning states according to high-frequency data from edison trend. one issue this could show up today, there is a proposal for shareholders requiring more political spending disclosure there nike but it isn't expected to pass, the company advises against it and has been voted down five other times. under armour is leading the s&p 500. that company announced a restructuring, laying off 3% of the work force, raising the low

end of its profit guidance for the year investors like the cost cuts this is on top of a 2% reduction in work force under armour has announced so clearly they're thinking about coming out the other side both stocks have been winners on the idea that just when we thought the whole at leisure trend peaked it got a new resurgence on clothing, accessorys and footwear and nike and under armor have been be beefing up their game. that will be the theme. >> did you mention gap starting a national at leisure brand for men so everybody in the pool. >> following lululemon which has been one of the best performing stocks out there up almost 100% and men have been a huge growth driver there. >> sticking with retail. amazon is expected to unveil new devices related to alexa as it expands into the smart home space after yesterday's report that eu antitrust regulators are

investigating amazon's use of sales data from third-party sellers on the platform. joining us for a closer look, mark mahaney, tim wu at columbia law school good to see you both. >> pleasure. >> they keep changing the framework with which we view antitrust. where are you with amazon and regulation >> well, i think the eu has a concern. if you think about the future, all of commerce moves to online platforms like a-- amazon, what are the questions of competition. is amazon spying on you? so they're worried about amazon giving themselves an unfair advantage. it's a european concern but i can see it coming to america. >> sort of like a gdp -- >> not about privacy. >> i mean in terms of policy starting over there and migrating here >> the ftc in particular, federal trade commission, has been concerned about competition on platforms because if you think the whole economy is driven by flat forms you want it

to be something where a better product wins not that amazon gets to dominate everything it's like microsoft in the '90s how they would copy everything that came on their platform. you want to have more vibrancy and competition so it's something the ftc can get interested in. >> that's not good is it, mark do you agree with that and do you think today's giants have learned lessons from how microsoft acted back then? >> i think you had the eu that would consider itself successful having imposed a penalty against google so they're targeting amazon that's not too surprising. the two business i can business model points i'd make, we're talking about amazon's private label business and how they use day to to build that up. that's among amongst all retailers. they all use data to figure out what private label lines to go into the question is whether amazon is abusing that it's hard to make that argument. the second is an issue of market

dominance. the issue google had is that it accounted for 95% of all retail searches amazon is maybe 30% to 40% of all retail sales and 2%, 3% in europe it's hard to make the argument it's a dominant platform in you were or the u.s. >> i don't know. mardi gr these companies have been taken to task before what's the worst-case scenario does amazon have to totally change up its business in europe or is it a fine? >> it's probably we're talking three to five years down the road that there will be a fine looking at what the eu did with google twice that doesn't mean it's right or wrong. i don't have a strong opinion. the odds are as a stock picker you would see a fine what i've seen out of google is shares have worked through well.

we haven't seen a dramatic change in business practices and i doubt you'd see one at amazon because this is common industry practice when retailers build up private label businesses they use data that's maybe not amazon's fault they use data exceptionally well. >> tim, you had a thought? >> i don't think the fines are the question the questions are what europe orders them to do. amazon might not want to but if they're ordered to not spy on whoever they're carrying, the most extreme would be to wall them off from selling on their own platform it's happened in the past. it hasn't been common but complete structural separation in terms of hosting the platform that would be the worst-case scenar scenario that would be it. >> of the large players in fang that we talk about effort whom do you see is most vulnerable to changes? >> in the united states i think it's facebook.

i think the acquisition s whatsapp and instagram have vulnerable. >> do we have a motivated department >> they've had trouble in the courts but the president seems motivated to -- and people take their cues from the president so my view they're in the most risk because they're power, growing, they have so many enemies and when you have that many people start complaining they're taking over our business. >> but the consumer is not their enemy. the consumer like low prizes and prime shipping. >> that's the reason amazon has skated free. antitrust has been about lower pricing and -- amazon has not had trouble because consumers love it. >> how would you ladder regulatory risk on the big names you cover, mark? >> probably google first, facebook second and amazon third. i would agree with tim on that.

>> not too far apart guys, going to be fascinating to watch. tim wu, mark mahaney coming up, eli lilly's spinoff getting ready to go public at the new york stock exchange the ceo, jeff simmons, will be joining us to talk about pet health kcare dow surging to record highs. record highs for the s&p 500 and technology is a leader with the nasdaq up a peenrct. sweet will be right back "squawk on the street" will be right backdo you work with it? ask this farmer. he's using satellite data to help increase crop yields. that's smart for the food we eat. at this port, supply chains are becoming more transparent with blockchain. that's smart for millions of shipments. in this lab, researchers are working with watson

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time for our etf spotlight mike santoli on the floor with the look at the divergence we're seeing continue with american and chinese technology companies. >> so we've been talking about these global divergences for a while in general terms the u.s. market has tremendous outperformed all non-u.s. index indexes and the tech comparison is extreme it's apples to apples. it's been profound look at the chart of the qqq and

the chinese version which is the cqqq tremendous split starting in the spring but on the right side of this chart starting to see some bounces in the chinese stocks as the tariff fears either use themselves up or there was a sense that maybe they were easing up as the qqq, the u.s. stocks have backed off so the chinese portfolio is up 8% the u.s., nasdaq 100 is down about a percent and a half from its highs so a slight closing of the gap. the eem, the emerging markets etf, is heavily weighted in the same exact stocks that one the chinese stock. we have a chart of amazon versus alibaba. very similar chart and seeing tentative signs that the chinese counterpart is bottoming not sure they have to converge but it would be better for global market stability if you

didn't see these lines going in opposite direction at a steep angle for very long. >> definitely on point today mike thank you, mike santoli with the etf spotlight. dow is up 188. let's get a news update with sue herera good morning, sue. >> good morning, carl, good morning, everybody here's what's happening at 24 hour south korean president moon and north korean leader kim visiting a sacred volcano in north korea on the last day of their three day summit later moon said kim told him homes a second summit with president trump included as soon as possible. the co-founder of alibaba says people should make preparations for 20 years of a u.s./china trade war. jack ma making the comment at the world economic forum in china today. ukrainian parliament overwhelmingly supporting the president's bill to join nato and the european union that bill will be reviewed by its highest court which will decide on whether the ukrainian

constitution can be amended to allow parliament to hold a final vote back at home, a security breach at orlando melbourne international airport forcing a lock down of that facility an individual boarded an empty commercial jet parked near the maintenance facility the individual, believed to be an airline flight student, was removed from the plane and is under questioning. understandably so. that's the news update carl, i'll send it to you. >> when we come back, a cannabis roller coaster you know the name we're talking about, tilray. the pot stock captivating wall street with the wild ride. we'll talk about havec that focuses solely on investing in pot with the dow up 178.

welcome back to sweet. i'm sara eisen with carl quintinilla and david faber. about an hour into the trading session. it's a strong one. the dow is off its highs but still trading up 178 points 234 record territory same with the s&p 500. up half a percent. the nasdaq off that 1% gain but still up 0.8%. it's technology, also groups like materials and financials that are leading the charge today. consumer staples and health care going strong. >> taking a look at a few cannabis names tilray, kronos, canopy surging higher for the week. coca-cola announced they are considering a cbd infused beverage what can we expect next? the price action in tilray yesterday, is that helpful for your space or not?

>> i think it's always help. for our space. it shines considerable light on the cannabis industry that more and more people are talking about so ultimately i definitely welcome this at the same time i think there are questions about kind of the frothiness of some of these stocks in the multiples they're trading at i think a big function of that is probably driven by retail investor demand with lack of alternative investment options. >> walk us to what you think our reasonable valuations based on the projected revenue base for the industry, say in canada alone, over the next few years. >> what are the reasonable valuations i think realistically canada is not where we're going to be focusing our attention down the line they've had a great opportunity to kind of be a first mover advantage with nationalizing --

legalizing cannabis at the national level so that's been fantastic for these public companies to have access for the capital markets. at the same time, i think what we're going to see more and more is how our u.s. companies starting to try to access the capital markets be it in canada or elsewhere. >> i'm looking through your portfolio, i don't recognize these names. what companies are you looking into and why not these telerays and canobie growths that we talk about and that there's so much retail interest around right now. >> great question. for casa verde, we're based in los angeles and we focus on the ancillary investment opportunities so that's the legal scalable picks and shovels that support the industry. things like technology, like e-commerce, like recruiting financial services things of that nature. we feel these are considerably more scalable opportunities and

thus much more representative of kind of a true exposure to the cannabis theme as opposed to singular names like a till ray or canopy growth. >> we're looking at till ray which is trading but almost a thousand years worth of its current revenues they'll go up a lot, those revenues but give me a sense five years out as to how you sort of see this industry from some of the names you mentioned that are providers into the overall ecosystem to how many people are going to be using this both for medical and recreational purposes. >> i think in five years times and perhaps earlier this is going to be fairly ubiquitous. i presume that every single big alcohol company will be in the space. you already see big tobacco coming in. in fact recently imperial brands invested alongside us to a company called oxford can be mid

to technologies. gw pharma is one of the most well known in a company working on cannabinoid research >> does the underlying price of the krob go down -- crop go down with new producers >> absolutely. cannabis is a modty like anything else. in canada it's slow going and the market is just turning on but in the u.s. we've had quite a bit of history with this most recently you'd see in oregon where wholesale prices drop by almost half so there's definitely going to be serious compression in the near future and that's why the real question is how will these producers be

able to produce at marginal costs? and i think as it pertains to canada the question might be how realistic is that down the road for them to produce that marginal cost? >> at least in canada we have visibility on the law. in this country it's murky on what status they're going to take, at least on industrial hemp mcconnell has introduced this bill how much will it affect whether coke can do this in the states, for example? >> on the coke side, they're looking at it from a cbd point of view so that is a different angle versus big alcohol in terms of life-style interest coke is more looking at it from a health and wellness point of view so i think that's one element. two is that while in the u.s. there's still uncertainty for veb which you are funds such as ourselves, this is kind of the perfect opportunity to

capitalize on these uncertain regulations where companies like coke, etc., etc., might be reticent to be investing in the u.s. that's why these companies are exploring investment into canada because it's federally legal so i see this ambiguity in the u.s. as a tremendous opportunity for funds like ourselves. >> and if it turns south on you legislation wise in the state you always have canada to fall back on? is that what you mean? >> can you say that one more time >> i'm saying if legislation in the u.s. goes against your trade, is your point that well we at least know canada will be an open market >> canada will most definitely be an open market. you have other international markets opening up or already open colombia is open uruguay is open. israel is doing considerable research germany is the largest cannabis market in europe i don't think it's a one-trick

pony in terms of any country this is dependent on. >> fascinating space getting so much attention, especially now thank you, please come back. >> thank you very much for having me. >> who knew there was even a staffing firm that does cannabis industry when we come back, eli bllly's spinoff elanco set to go puic jeff simmons joining us. dow is up 200 points don't go away.

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the dow within striking distance of its all time high but a dozen blue chip stocks are stuck in correction territory. we'll llouhi neste y wcham could be primed for a comeback at tradingnation.cnbc.com

rick santelli with the santelli exchange hi, rick. >> hi, honestly, my favorite

guy, ira harris, we have so much to talk about. abe gets the nod once it's official it's going to be a three termer, nine years, the longest server premier of japan. the reason i mention it 1 the bank of japan, european central ba bank, they're not doing what they should be doing. >> they're stuck in this headline on reuters that abe was distancing themselves from the inflation discussion i talked to my in-house expert and he said it's a bad translation. so i'm not giving it that much and the market isn't reflecting. >> nor is norway's central bank raises for the first time years. what i want to talk about is what happens to these central banks and their economies that are fighting or can't pull away

the stimulus. >> we saw it last week draghi is caught here in a terrible trap. he's caught in a trap. he's going to see this through until the end of december with $15 billion but they've made a trap for themselves because how do you exit from this? the southern more indebted companies don't want them to exit and the northern tier germany wish they would have done so now we're seeing it playing out in discussion. who will get to be the next president? what's the tradeoff going to be? it's all politics but let's go to what draghi said and here's his trap he says he's not going to start shrinking the balance sheet but that runs into a situation where he says they'll sustain the capital key. the capital key says the ecb has to buy 18% german assets there's not german assets to

buy. >> which has been an ongoing discussion since it came out is the strategy. >> if they would honor that i would say the play to be in europe is to be long bones and short the french debt. that's the easiest play to make. the french have all types of debt the germans are running budget surpluses. this is a serious issue for draghi and this lays a trap for him of his own making. i don't know how they get out of it unless he violates the capital key. >> as an investor, this may not be something to be worried about in since months but in the long term investors will have to deal with this in a big way. >> and there's the spillover effect. >> which i'm worried about the most in terms of what comes over here. >> and the politics, everybody talks about the straw man of immigration in germany i would vehemently argue and push back that the afd started because of the financial repression of the german savers.

>> we're out of time real quickly interest rates moving up. are you shocked considering the economy and where stocks are >> no. >> i didn't think you were. >> i've got a bet that if the ten hits 3.4 before the end of december the yield on the ten, 3.4, i'll get a bottle of poppy van winkle and i'll be happy to drink it. >> ira harris. sara, back to you. >> let's send it over with a look at what's coming up on "squawk alley." >> oracle is up better than 2.5% but the action has been uncertain since earnings, especially when it comes to cloud kroegrowth, we have mark ceo of oracle coming up on "squawk alley. ♪

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welcome back to "squawk on the street." the best levels, health care stocks among the best performing groups that sector on ace to close at a new record high today. you have nectar they arapeuticsn cardinal health as well. and look at the etf that tracks

those names. that stock hit a new high today as well. david, back to you guys at the stock exchange >> thank you, dom. animal health care company elanco is raising well more than a billion in the initial public offering we're waiting for the first trade. that money goes to eli lilly joining us, jeff simmons nice to have you here. >> great to be here. >> looks like it will be a strong open up from the $24 pricing. what are you going to do differently as a public company that you might not have done as part of eli lilly? >> great question. i think the dedicated animal health motto is the way to serve our customers better it is about speed, right cost structure, using the capital in the right way against customer needs. we are in a position of strength

and the market is ready. the phenomenon interest in animals, a society never had more interest in animals, on the pet and livestock side great excitement today excitement with our employee base as well >> what do you do differently as a public company, anything or same thing, same play book. >> i think our needs continue to differ between farm and animal health in terms of serving farmers, veterinarians, what cost structure, how we utilize capital against our needs versus greater needs of eli lilly that's ability to unlock value will happen that way. >> animal only antibiotics up 9%, that's 24% of total revenues that's big numbers do you expect that kind of top line growth can continue in animal only products >> we're looking at the area of the livestock sector and have been for more than ten years as

stewards in this area with the industry it starts with the well-being of the animal we are innovating alternatives to antibiotics the animal only doesn't bring resistance concerns people have had. that focus, high quality meat, milk and eggs starts with a very healthy animal that's where we begin and focus mostly around that veterinarian that knows the condition of the animal as well as anybody. >> how much of your business is pet health care versus animal for food health care. >> it is about one-third, two-thirds one-third companion and pets a lot of growth on the pet side. leaders in pain, osteo arthritis, launching a new product, and we'll continue to see the pet business increase as percentage of our total business over time. >> how about r&d versus human health where does it rank. >> we are spending 8% of sales

on r&d that's consistent. we are launching as an ipo, launched three new products a year since 2015, doing it again this year. we come in as an ipo with a nice portfolio of products in livestock and and malimals. >> is it on certain conditions >> focused on the aging pet, we increased the pets' live about two years, chronic disease of pain, osteo arthritis, cancer. on the food side, alternatives to antibiotics >> hoping for diabetes my dog has diabetes. needs insulin shots. on the livestock side, it is facing tariffs and is caught in the cross hairs. does that effect business because your primary customers are hurting with exports >> we have a global business when you have a global business, dependency on trade for the way

our business makeup is is something we don't believe is significant concerns here in the short and medium term. >> eli lilly has the opportunity to sell stock over time, given they're still the largest single owner. do we have a plan for them, expectations in terms of distribution of what remains which is obviously a lot >> they have been clear with remaining shares they'll be exiting the ownership in 2019. >> you think it will cap your share price, given they're going to be hitting the market >> i'm going to stay away from, we're new on wall street today, but we're not new in the marketplace. i think elanco has the most noble customer base, farmers, veterinarians, innovative people, visionary, very much focused on how to take animal

care to the next place. >> that stock price will be doing well today to take it to current events, we are reading about what's going on in north carolina with the enormous amounts of hog waste, for example, that conceivably is a threat to some local communities and overflowing. is there an answer there that you might be involved in in terms of working with the farmers? >> we start with the crisis. everybody is focused there, our thoughts are with them it all comes back. you go to today's farm everywhere in the world, advancement of that farm continues. and with innovation, the farmer is more aware than ever of what the animal needs, what the land needs, and more importantly, what the consumer wants. we're going to come alongside with the farmers to innovate into that future, no question. today without question, big day. but i attribute a lot of it, over 5800 employees that have gotten us here, the most

dedicated, loyal, love this industry and the customers we serve. today it is more about them and the customers we served. >> formed in 1954 by eli lilly coming up, on closing bell, big earnings report. micron is down 21% in the past three months it is a big gainer, one of the top of the s & p now at 3% we will bring you the numbers as soon as it hits. see you then. "squawk alley" is next we talk to oracle's mark hurd. the dow nghas onto record highs. the dow nghas onto record highs. up now to 217.d to the spark ca. i earn unlimited 2% cash back on everything i buy. and last year, i earned $36,000 in cash back. that's right, $36,000. which i used to offer health insurance to my employees. my unlimited 2% cash back is more than just a perk, it's our healthcare.

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