saw it in the "times" and someone lodid something and they looked into the organization >> at your apparel >> dangerous time. >> folks, thank you for being with us today. make sure you join us right back here tomorrow. right now we'll hand it over to "squawk on the street. ♪ good wednesday morning, welcome to "squawk on the street," i am carl quintanilla with david faber. jim cramer is in san francisco again attending dream force 18 it is fed day, we have a press conference, we'll watch that along with the potus at the u.n. and a lot more, futures is up about 18 oil is down after the bill on api last night we begin with nike posting double digit earnings growth

>> stock futures are pointing to higher opens this morning. investors seem to be trading off those trade tensions, looking ahead of the trade's decision this afternoon cbs taps parsons after the exit of les moonves. the company says growth was driven by acceleration in north america and strong momentum in international markets. gross margins missed the forecast and that's weighing on the stocks >> nike digitalis leading the way for differentiated retail of 36% for the quarter. we saw acceleration in both our sportswear and key performance >> they did talk a lot about

data and analytics, guys at one point, jim, they discussed a store in l.a. where the entire assortment is chosen through data data they drawn from consumer pretrial conferen preferences around the neighborhood >> this is about the personalization of the shoes, it will be able to break the commodity cycle. i thought the quarter was fine and the stock ran up it is supposed to be a blow out quarter. remember the stock was 79.80 during colin kaepernick when it started that controversy there is nothing that makes me want to sell the stock other than the fact that trader is flipping out i was on the k.b. home call last night, pretty good corner. what are they talking about? the google personalizing homes you can't put out a commodity of anything that's got to be personalize to the user. >> best performing dow name of

the year so far. they were asked, jim about that just do it campaign with kaepernick and how that decision came about, talked about maybe a bit of the market cap fallout a couple of days after that. take a listen after that >> we feel very good and very proud of the work that we are doing with just do it, just introducing just do it to the generation of consumers. we know it resonated quite strongly with consumers. obviously here in north america but also around the world. it is really transcended the north america market to touch people around the world. all right, jim, if you are not in the mood to sell it, how do you think of the potential for things like dollar head wings going into the last quarter of the year >> i think we'll hear a lot about the dollar when we start hearing a lot of the earning

reports. i don't want to be dismissive of these concerns there is only one shoe company that i think is near what nike is doing right now and it is not adidas and that's vans vans is the hot shoes right now. i think when i look at some of these retailers that have moved up a lot, people projecting tariffs or dollars that's going to hurt them i feel that tariffs are an issue and dollar were sensitive of the idea of where the dollar is trading. this is the best stock and it is time for other stocks to do some leading including ibm. >> ibm gets an upgrade they go to buy and they see upside 197 and they point out, service is not an ai and 4 x and mainframe head wings >> that's right, i was thinking

about that piece when you mentioned about the dollars. it is called the evidence slab that they have with ups. the evidence is that don't count on those two positives to impact the stock any time soon. i am out here. there is just a tremendous amount of people rooting for ibm and the ethics of ibm remaining the best in the industry contrast to what we keep on hearing of facebook. >> yeah, it was interesting and i know we'll listen to those comments and benoiff who talks about it we have been talking about for years now. these things do tend to take a long time. >> yeah, david, i will tell you, i think it is a battleship, we had it through the ten-year.

what i think is happening is that it is so hard to catch on i think ibm is doing many things right. at the same time you are up against these companies that for instance, ibm is a terrific encrypted cloud. it is hard to be able to crack and that's great if you work at cyber curve. you are dealing with amazon and google and apple and what happens is it is a little overwhelming to realize that every time you think you got some advantage against them, they come up with something new and something personal or something that's worldwide that attention is grabbing. i just think it is hard to be jenny and martin and not wake up every morning and say oh man, the posy, the posy, they're catching up to us. >> it is funny, innovated scales, some people pointed to amazon doing better than anyone.

not everyon a question >> look, i think martin has been groomed and he was the cfo before this. i think he's doing a terrific job. i do think if you read that piece, the overall meaning experience of the ubsb is come on, it is a still great company, it is getting it together. everything else move up so much. you ought to look at these stocks because it has not done anything i know that seems to be a reason to buy a stock boy, is that ever a true narrative. >> is everybody going to start saying that about ge >> i mention at the stock of $11.25 opening today thinking about it is a name that we know so well on american icon for all those years. i have spoken on a couple of fun managers who are finally to look at ge at this level. i found another 10 or 12% of the last few days on concerns of

turbine that produced power. it is one utility. the stock just runs for the hill of anything. >> yeah, they do because of balance sheet and the company just talk about quitting ibm. fabulous balance sheet the only issue that these companies have is are they the gre greatest ge sinks the whole ship. we talk about accounting divisions and weakness and order and turbine business is terrible and we are supposed to be well ahead. they're not in part because of renewable don't make that much money. everyone is waiting for ge to be able to say, we got assets and we got a balance sheet that's improving. i think it is the balance sheet that controls the story right now. i don't know if you have seen 20 years returns and now negative on ge, market cap below $100 billion >> don't forget they sell the

plans in terms of healthcare and dividing off the ownership of bak baker hughes >> that's the official name. >> there is going to be question about leadership there, you got some active people on the board of director. i mention it because of these recent new lows of ge and hearing you talk about that sort of activity. you wonder if anybody going to start looking the same at ge >> i think our larry kudlow knows better than anyone how much that healthcare division is worth. you start talking about $100 billion coming. i am not coming. given the evaluations we are getting -- that division can worth half of this company i think with oil up, you would expect baker use a ge company would have a little more

momentum they're like slumber jack. >> would you love that >> carl quintanilla. >> and rusty tacos >> oh, i love rusty tacos. >> it would be better if his name is fresh. >> it isactually a lot of interesting, we talk about successions and boards, a lot of interesting management news this week ken frazier is extending his ten years and dick parsons, cbs at the top of the show. >> yes, and as well as the departure of two directors including william cohn in that article he was quoted in a way that was not positive for him. mr. gordon who was seen as a

moonves' supporter >> he reported that line, i don't care if 30 women come forward. >> the board of cbs changed dramatically i am taking a look at it and parsons and redstones. you got independent director galore the question for cbs is what's going to happen with ianiella. >> okay, we'll go to president trump right now who's speaking

>> i just want to see venezuela straighten out i want the people to be safe we'll take care of venezuela we'll take care of venezuela what's happening in venezuela is a disgrace if he's here and he wants to meet -- i don't know, it was not on my mind and on my plate if i can help people, that's what i am here for >> are you going add to protect your allies in your region of the border of columbia >> our allies are in no trouble. we are with our allies we are with our allies 100%. they have no problem we met yesterday with columbia, they had a great meeting with columbia, we met with numerous with our allies and they are absolutely in no trouble

i look forward to meeting him again. we don't have anything set but i look forward to meeting him again. >> oconn north korea, what needo happen >> a lot of good things have happened we are denuclearizing north korea. we have a wonderful relationship going between our country and them we are being helped a lot by japan and very much by president moon of south korea. north korea is going along very well we really have made a tremendous amount of progress since this time last year >> all options are on the table. everyone, the strong ones and the lesser than strong ones. you know what i mean by strong

every option is on the table with respect to venezuela. we'll take care of the people of venezuela. we have many venezuelians living in the united states i gotten to know them very well. these are great, great people. we'll take care of those people, okay >> chairman kim wants good things to happen for north korea and good things are happening with respect to north korea. it is going to be great for chairman kim and the people of north korea. that's what we are all about a very good relationship with prime minister abe, he was in my apartment the other day in trump tower, we had a long couple of

hours discussions. he loves his country he had a tremendous victory and at the election as you know i was very happy about i don't know if you are supposed to endorse somebody or not but i endorsed him he's a great gentleman and man he's a great leader for japan. we have other things to discuss. more than anything else, we'll be discussing trade. i will be meeting with chairman kim in the very near uture it will be announced we'll are a press conference today and we'll start talking about that we'll announce where and when in the near future. >> thank you >> mr. president, you said yesterday the first lady -- >> yes, they're going to announce it in an hour you should be there. she's got a press conference in

about an hour. they're announcing -- she's going to four countries in africa they'll be announcing it in an hour she's going to be making the announcement which is much more exciting than when i am making the announcement she will be making a big trip to america and we love africa africa is so beautiful most beautiful part of the world in many ways just let me do say that she's having a news conference in a short period of time she will be announcing exactly where she's going. you will see about it. >> i think the senate and the republicans can not be nicer in the way they're handling it. they could push it through 2.5 weeks ago and you would not be talking about it now which is

what i refer but they did not do that the republicans could not be nicer and respectful to the process and the woman. i am okay with that. i think i might of pushed it forward a lot faster i will tell you what i know this particular man judge kavanaugh, he's outstanding, you don't find people like this he's a gem he's an absolute gem and he's been treated unfairly by the democrats who are playing a con game they know what they are doing. it is a con. they go in the back room and they talk with each other and they laugh at what they get away with it is a con game that's what they play. tha that's about the only thing they do well. thank you very much. >> that's the president, he has a busy day today, bilateral with

benjamin netanyahu later on this morning and the u.n. council meeting for the first time and making comments of venezuela after treasury sanctions closed in maduro's circle yesterday and discussing kavanaugh and north korea as well. eamon javers is monitoring those remarks and his busy agenda today. >> reporter: that's right, you heard him there talking about venezuela saying we'll take care of venezuela and options are on the table regarding h i venezue. he singles venezuela out yesterday, not clear what the options are that the president is considering in terms of venezuela. we'll wait to see if we can get clarity on that. you heard the president says he's gouing to be announcing where and when for another summit with north korea. looks like the president is committing now to meeting with

kim jong-un and we may get that as well. the president got a news conference at 5:00 p.m. today in manhattan. he hinted that they'll make that announcement later on today. more to watch for today. as you say bilaterals with benjamin netanyahu of israel and japan and with the u.k. today. those sort of face-to-face sessions are so important in international diplomacy. the president sharing security council today here at united nation >> a busy day in new york. we'll be talking to you eamon javers >> he did make one comment about trades it appears to be -- mostly some are saying it is imposed by friday >> we talk about autos and we talk about what's going on with mexico earlier this morning on "squawk box," we talk about how 30

states have canada as their trading partner. a lot of these states have a go in the midterm election, a lot of people feeling that's going to put pressure on the president. nothing has really stuck when it comes to the president's view on trade. i think canada is important. i am not saying the market is necessarily taking a hit because it is overlooked a lot i do say there are people who'll sell if canada does not come into the fold soon >> all right, jim, we'll talk to you in a moment. we'll get your "mad dash" after a short break. we'll talk more about the feds and what we may expect out of press conference today and keep an eye on the service monkey, futures are off the highs and off about 10 points in the dow back in a moment

we got about seven minutes before we start with our trading. starting to miss you already, jim. kb home, not necessarily a west coast company, when do you want to talk about the "mad dash. >> the company was denfensive of the idea of, main street is buying fabulous home sales throughout the country expensive homes selling well in

california, less expensive homes selling well across three other regions. what's important here is i think both the housing business and the autobusine business, we hava really good stock market kb home may be able to break it. nobody cares, we got a fed meeting today. i don't know if this kb home can hold >> that was going to be my question fed meeting and mortgage rates and concerns there are you concerned and is the market discounting that? >> yeah, i am concerned that what's happening when you have good news and homes, everyone just says don't worry. these stocks have been down and down homes uniquely domestic and nothing can do with china. gross margins for kb homes work

extraordinary good people don't want to hear. kb home is an interesting story. this segment is in bare market mode i don't know if when you have rates higher, if anyone is going to change their minds. >> we got opening bell five "ua othstet now, stay with us onsqwkn e re."

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u.s. bank -- the power of possible. you are watching "squawk on the street," just about two-minutes on this wednesday morning, a busy fed day as we watch the president at the u.n. as well. on twitter i see you notice that senate finance is going to have a hearing on the impact of tariffs and on the auto business. >> i think there is a kind of a concerted effort to say this is hurting the auto country we have carmax's numbers last night. carmax is used cars. new cars are coming down in

price and margins are being squeezed because they are not moving the stuff that's moving is the f series and that's uniquely to small or medium size business. i would be careful with this group, do not take carmax of how the auto business is doing last year when we had hurricane harbor -- >> yes, of course, we mentioned dime ler, the ceo succession over in europe and some reports on tesla and the measures there taking there and try to make the quarter on deliveries. bloomberg got the orders in them and listing volunteers to help get these volunteers to get out the door >> look, i got to tell you tesla is hopping around 300,000. the bears take the balance sheet.

>> let's get to the opening bell here s&p and cnbc realtime exchange at the big board is jp morgan, highlighting the veterans initiative it is online survey company, survey monkey, we'll watch that today, svmk, sales force venture by the way is buying $4 million at the offer >> you buy some of these sales companies. hundreds of ceos started in sales force. what that is regarded as -- i listen to survey monkey earlier this morning talking about, what do they do at info. they don't

betray you who betrays always comes back to darth vader. >> the actual darth vader? >> did i say darth vader >> i meant to say facebook >> did you see the credits did you see who's playing darth vader? mark zuckerberg. >> my memory is failing me >> david, i was able to leave an hour and a half for the new yorker piece, i am almost done >> it is a good piece. >> it is great i thought it was well-done not necessarily things you did not know if you have not been following things closely those kinds of pieces can put a lot of issues in perspective >> can i just say last year a

lot of people are talking about it amazon is not here and we have to find a way to defeat them this year i come out here, i hear facebook is not out here. the departure of the instagram people, by the way who are logged here, let's make a big distinction, he's regarded as being a hero that's saying something when you leave a company. a lot of people talk about the departures in facebook it is one of the reasons why you have to come out because households here are unknown there. >> you did talk to benioff last night. you also talked about regulating facebook let's listen to that >> we put a huge amount of our power to so many technology companies. that's why there is a discussion now in washington, d.c. about regulation should they be regulated not just facebook but every company. you know the world economic

forum, i call for the regulation of facebook. >> yes, you did. >> i said they lost my trusts because how they handle their privacy scandal. they are in a crisis of trust. you see those actions by customers and consumers and executives now they can change. every company can change they're not the only company that's going through a crisis of trust. our industry needs to wake up and realize that there is a tech lash happening and we all need to step up to a new level of ethical and humane use >> davos did use the big tobacco technology he did not appear to be backing off of that, jim >> no. i was watching andrew ross talking this morning about davos, he's talking about it of something needing to regulate it mark marc is making the point of technology of good or bad but it

is how it is used. it is used to make our lives better there is without a doubt, sympathy towards facebook. i come back to the fact that i am still not seeing in terms of wall street research of a dramatic drop off in advertisement s in facebook because of where consumers is. facebook is down trades with value stocks >> you don't necessarily expect there is that much downside? >> no. i do think when they guided down and david, you were spot on when you said look, this is a real, real story about cutting numbers. that's possible that they cut numbers to the point where they can make the numbers and therefore, the stock is cheap. just because the company is hated does not mean stocks have to go down amazon are so powerful, amazon is in your home.

last year their theme is they're in your home and they know more about you. kb home, what are they talking about? google is going to be in our home pch home that's a kind of a theme here. >> amazon did say this morning they had some issues with alexa and customer ability to interact with the service along with delta's technology glitch which grounded the domestic flight last night jim, i don't think a lot of people saw this coming the biggest gainer -- >> look, someone was coming to me this morning, this is really the break out moment for ibm that's being factitious and david does not care at all nike, i keep oncoming back to the fact that when you sooee the analysts report, there is no backing way. >> by the way, let's go back to

the shoe door. what was nike's edge it was phil nike making the best technological improvements in sneakers once again parker leapfrogged the industry, people love that and a lot of personalization, it does matter. >> yeah. that was as great book although i tend to love the early days when he was going to japan, back and forth to japan trying to get them to figure out the right way to make the shoes or the sneakers. this is some great stuff there >> yeah, it is just a great book what silicon valley is like now what it was like then. >> chinese production and trade does help, maybe >> potentially >> it was japan back in their early '60s it is not like they never had started the capacity necessarily here

>> new balance still does all their productions domestic >> they do >> go pro is up 12%. >> yeah, this thing has been creeping up for some time. it has been josh lipton has chronicle what's going on with the company. there are product cycles we know best buy is doing well, what are they selling? they're selling go pro retail stocks. i am not putting in the scale of tilray tilray is the bitcoin. it is kind of like that's t the -- i have seen best buy doing well when i think of gadgets. takes you back to the highs of the year all of a sudden and back to january level. sun trust. >> i did want to finish my thought on cbs, guys, it got cut-off when the president

started speaking about the u.n parsons takes over the company's chairman, bruce gordon and cohen exit the board of directors. you can see the stock is up interestingly and viacom is up a lot this morning on an upgrade many people made note of the fact that under this agreement of the global settlement when moonves exited the company and the litigation -- they'll not be allowed to bring up potential talks between viacom and cbs the next two years that does not mean those on the cbs board you are looking at right there. mr. gordon is out and cohen is out, would not be able to bring that up if they thought it is something that's worth engaging on and viacom as ell. what i was about to say we'll finish the thought on is advi r advisers to both camps, the

focus is right now is ianiella trying to get things together. there is a thought next year it is certainly not in con seveceie people on board of both companies believe it is worthwhile doing that particular levi co ly viacom has been having having -- they have the fully composed board now that investigation is still going on both moonves action and the culture of the company and potentially you got to remember that investigation may also include looking if the board had any culpability in behavior and what it knew and why it didn't do something we want to wait and see what we learn in that investigation when

it concludes >> guys. you did that terrific interview of bob backish with viacom i watched that stock this is a hot stock not necessarily of the group but with if two. i know $13 billion of viacom is smaller than cbs but you have to admit that viacom is doing well right now. and in terms of buzz, people won't own viacom because its got the amazon view of jack ryan can this be actually a possum that they are putting together i think it is potentially something you can view possibly. more time needs to go by before something you decide to engage on if they choose to do so but, jim, you are right, it is funny the conversation around viacom has changed over the last year certainly the resurgence of paramount to the point they are talking about it favorably of next year in

terms of what they're doing to do and new leadership they put in place of certain areas and lig slight rebound and advertisements, i don't want to over state it. they still got their challenges as you know but so as cbs. how much are they going to have to pay for the nfl when those reds come backup and typically they are renewed years before the contract expires carl carl, we talked about this last year, maybe if the nfl was peaked, one of the story lines, is there a renaissance in the football numbers and therefore a lot of people think maybe they should be thinking a little bit more of regular tv and what football can do. i know some people think it is a side show but it is still the biggest sport of the country carl, i got to tell you, there are a lot of people who thinks there is parody in the nfl and

people are talking about new teams. this is a theme to watch and typically because people think disney can do something interestingly espn here. >> now i guess the new complaints is penalties and roughing the past. the criticism does continue. we'll keep our eyes on that. i do want to ask you about the ipo market we had neo and today's survey monkey, we have a story up now out of reuters, jp morgan are in talks to be the lead under writer for lyft. they're all about 2019, what does that say? >> some people say -- it is a bubble where you can buy it with a cannabis stock >> revenues for three years flat, stock comes out of a 37 multiples which had consisting

growth that to me is ranking speculations i got to tell you if that's impleme implemactic of what's beginning on these are one of the things we don't want to see too much excitement we want these to be okay it was too hot let's be careful >> yeah, i didn't realize 37 times is where that thing basically is trading now >> yes >> they are not everyone in the congressman i don't know group that much. they do a lot of launch stock which does not have great numbers. they do salmon in terms of bind finding vaccine and health of animals. i like elanco and i like it if it was 24 or 26. >> we'll find out more about survey monkey, what it does today.

dow is up 37 let's get to bertha coombs on the floor. >> good morning carl translating into higher rates per savers for a change. the 30 mortgage rate is up, it is not a problem for kb home the company's third quarter earnings beat in part on a better tax rate and gross margins are up and despite sales prices are lower it is another potential head winds for consumers though energy is lagging today. take a look at crude it is still trading $81 a barrel and concerned of sanctions in iran and take effect in november or driving oiing oil to a 40-yer high and energy stock are catching up

take a look at some of these moves. apache up 9% today conoco and folks are starting to make a bet in that sector. health has been a sector that has been out performing throughout the quarter health this morning is higher after settling a doj billion fraud for $260 million that's a lawsuit that inherited when it acquired hma back in 2014 cvs and aetna remains on antitrust watch after competition concerns over their merger cvs spokesperson telling me the firm is fears and ierce and rem. we are still waiting for a decision at the doj. >> survey monkey and surveying products and softwares above the expected range, $12 a

share. prior price talks for 13.5 million shares at a range of 9 to 11 we should see that sometimes late morning at the nasdaq carl, back to you. >> thank you, bertha let's check in with rick santelli on this fed day, good morning, carl. you recall the last fed meeting did not result in a great increase the last day of july and august 1st, all the following charts are from august 1st, generically, rates are up and dollar index is some settle preo rates, the dollar index has a quarter inbound. highs all across, look at the ten-year note yield, we have not challenged that yet and it is

not unusual to be at extremes moving into a meeting, most likely results in a quarter point will be fascinating to see the long end in the curve responds if we go to 311 and if there is room for the steeping curve not only summer but next year. if we look at the short ending in europe, it will be roughly the same as the long m 2-yr note have moved to the upsi upside foreign exchange, dollar index, you have to remember the next three charts that it was about emerging markets and the dollar. it is kind of interesting to see that the dollar is lower going into this meeting but it had an upside volatility and early august right after the meeting you can see the euro is the exact opposite the emerging market took a dent

out of it as did the pound verses the dollar you see there. that has out performed considering all the issue of brexit carl, jim, and david, back to you. >> rick, we'll see you later on. coming up, interview with patrick soon-shiong, s&p is up five, a busy day, we'll be back aine. notebooks let your workforce go anywhere. it orchestration by cdw makes sure your data stays close at hand. with the hp elitebook x360, and its innovative security features, including multi-factor authentication, hp sure view integrated privacy screen, and sure start self healing bios, preconfigured by the experts at cdw, so your defenses go wherever you go.

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let's get to jim in stop trading. >> boy, carl, same pat we were this home builders everyone gets bulled up, they think this time it's different kay bee homes 26, 27 right down why is that? because we've got a fed meeting. when you're raising rates, the play book says sell home builders about that's what they're doing regardless of how well the company puts up a story. >> average 30-year now 4.97%,

just a shade below 5%, jim got to go back to 2011 for that. >> well, people, remember 5% was great at one time. but doesn't look so good versus where we were a year ago. >> jim, what do you have on mad tonight? >> i got united. look at this stock this is has been unbelievable. this is oscar munoz who's done such a good job running it vm wear is exciting because it's on boarding in the cloud box, the last couple quarters people say not so good let's find out from aaron levie. he's been a straight shooter the whole time. >> vm word has dell traid. >> they've got a relationship with amazon better than any

company on earth. >> and with airlines you've got fuel and labor this technology glitch and then these bag fees, i assume, jim, you've been watching the incremental additions to how much it costs you to take a bag on the plane. >> that's part of the gross margin improvement this is an on-time story you get planes running on time, people come back i think this is a story about management and how poorly the thing was run before oscar came in the stock has been up nothing but straight line ever since that incredible video. i'm not saying you pull someone off a plane and stock goes haier b -- higher, but holy cow didn't matt matter. >> jim cramer out west when we come back, the fed decision, trade, the economy we'll talk with former white house economic adviser jason furman dow is up 54

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pink that. dow is up 45 on a day that is chock full of news poe cus at the u.n., auto tariffs and consumer privacy. >> our road map for the hour will begin with day two for the united nations general assembly. the president is getting ready to host a national security -- a security council briefing, that is what we can expect to hear from the president straight ahead. >> investors bracing for a rate hike as the fed wraps up a two-day meeting. we'll look at how stocks and the k economy could respond. >> and shares of nike fall we'll tell you what is scaring investors and we'll hear from ceo mark parker from the conference call. >> earnings from kb home, now economic data regarding new homes. hey, rick. >> new home sales for the month of august expected to be up around $630, 000 up darn close, $629,000. that's seasonally adjusted annualized units and that's up

from 608 which was revised lower. that puts it up somewhere between 3% and 4%. we'll call it up 3.5%. remember last month standing at 6.08 makes last month the lightest month since august of '17. this firmer action how much more? let's ask diana olick. diana, what did you think of the new home sales data? >> they're good. they're solid. not the greatest we were expecting. you're up 1.9% in pricesing which a difficult thing because we're looking at people who are trying to get on having affordability issues you have mortgage rates in august we're 75 basis points higher than a year ago so to see prices up 1.9% median price of a new home sale, we were hoping to see that moderate. remember, these are signed contracts to buy newly built homes in august so it's people out shopping not the closing in existing home sales but also seeing

inventories of new homes up to a 6.1 month supply that's the highest of the year so you have a lot of available supply but the sales numbers okay they're okay not saying they're not but they could be stronger given the demand it's that affordability problem we continue to run into housing which is getting worse and worse. back to you guys. >> diana, good afternoon diana olick. we're a few moments from hearing from the president once again he e's chairing the u.n. security council, a briefing on counterproliferation eamon javers is there. we heard comments regarding venezuela, north korea, and the u.s./middle east peace plan. >> yeah, that's right, carl. we just saw the president sitting down with benjamin netanyahu of israel. the two talked about iran. netanyahu praising president trump for his tough words on iran yesterday but we also heard from the president on the middle east peace deal he said that the administration hopes to have something ready and what he said would be two, three, or four months. so something coming on middle east peace from this

administration the president said he hopes to have it done by the end of his first term a lot of presidents have felt that way in the past we'll see if this president can tackle that very significant problem. he said one thing working to his advantage, though, now, is that that embassy move in israel to jerusalem, he said the united states has done it, taken it off the table. it was a controversial step but the u.s. side feels now that having done that they now clear the table in effect for negotiations between the israelis and the palestinians. we'll see if palestinians agree with that sentiment. the united nations running the security council meeting, the u.s. now taking over the presidency of the security council. that happens on a rotating basis and now it's america's turn, carl >> what do you expect to be the topic of conversation at the security council which is, as you say, ae mono, a very important group in the u.n., the powerful group in the u.n.eamonn

group in the u.n., the powerful group in the u.n does he need to build a consensus around ooern >> this is the core. this will be about iran todayir? >> this is the core. this will be about iran today and the question is whether the president can get consensus with those big five powers to figure out if they all see the world the same way the president was just asked about european nations trying to get around sanctions on iran he says he thinks the europeans will behave nicely in the future on iran. just watch, he said. so maybe the president knows something that the rest of us don't know yet in terms of europe's attitudes on iran that's the challenge here is corralling those countries to come around to the same view on what to do about iran and the iranians themselves are here this week as well and they're making their own points. >> eamon javers, eamon, thank you. joining us to discuss this, eurasia group president, ian

bremmer and michael mcfaul ian, after that spifiery speech rejecting globalism from president trump, what are you watching ahead of the security council meeting? >> that will be mostly about iran they're talking broadly about non-proliferation but let's be clear, trump's toughest words yesterday were delivered against the iranian regime it sounded like what he was discussing against the north koreans a year ago at the united nations. now he's engaging with the north koreans, the europeans have already said they're going to try to find a way to engage in financing around the united states. >> is that going to work >> won't work. they won't get it together fast enough the americans are the elephant in the room not like north korea where the chinese were the elephant in the room he won't have consensus in the security council meeting. >> let's stop. why won't it work? yesterday you tweeted it won't work, the iran deal will be dead but give us more sense as to why that will fail. >> because the europeans themselves are incredibly divided in terms of how they

should engage with the iranians. it's not a big priority for them they don't have money actually at stake the concerns about being kept out of american banking systems and the rest is a challenge for them so they do want to say they're going to do this but when the german foreign minister said they were thinking about alternatives chancellor angela merkel within hours said that was dead on arrival. clearly there are disagreements inside the governments in europe they're all angry the americans have pulled out of the iranian deal, but that doesn't mean they'll do anything about it so the real problem is the iranians over the next couple months will lose a million barrels a day and their economy will be in deep recession next year. >> already getting slammed and their currency is collapsing ambassador mcfaul, how do you see this playing out for iran and do you think there's a chance of a sit down meeting between trump and rouhani any time soon? is. >> the president will be isolated on his position on

iran, especially at the u.n. security council the permanent members supported the iran deal and still support it that doesn't mean they can save it, as ian said, but on principle, on policy, they're not going to pivot to support president trump just because he gave a fiery speech yesterday. he's the master of being tough and then being soft. i think he said president rouhani, he's a very nice guy, an incredibly nice guy, something like that he tweeted his strategy is always to be tough, to provoke and then to try to cut a deal. so far i would say that strategy around the world hasn't worked very effectively but, you know, i wish him well because we need to have a deal. >> tough talk. now we're waiting for deal part before friday.

self-imposed deadline. but is that going to happen? >> i don't know if it will happen by friday we're talking about this system of supply management on dairy that is challenging for trudeau domestically, both the quebecois elections and also for him next year he wants to get to a deal. they don't want nafta to be a big international problem. i agree with mic on most things. let's be clear so far on trade trump hasn't gotten big deals but he has gotten incremental movement from the south koreans, brazilians and from the eu he hasn't from the chinese yet yesterday's speech, it's interesting he's been on china but was talking about xi jinping. the one thing we can say about china is that trump wants to make it clear that nobody can get the deal done except trump himself. so nothing will happen until those two men meet at the g20 in argentina at the end of november but i think trump is trying to

put out that he wants to show he can get something done there. >> you were saying the takeaway from yesterday's speech is he could have been tougher and harsher on china and you think it was an olive branch of sorts? >> i think the headlines are about how people laughed at him but the market takeaway, the thing that matters is china secondarily and iran on iran we have problems, on china the market take away is positive. >> ambassador mcfaul, as somebody who was once an ambassador to russia, are you surprised there's been no mention of putin or that country? >> not from president trump i'm not surprised anymore. but it's striking. this was supposed to be a speech about sovereignty, an ode to sovereignty, why sovereignty is so important in the world and yet russia's violation of sovereignty in ukraine in 2014, violation of american sovereignty in 2016 in our presidential election or violation of british sovereignty just in this year when the -- russia sent two gru officials to try to assassinate a former russian intelligence officer

not one word about those violations of sovereignty from russia >> what's so interesting to me is that this speech sounded like a chinese speech from years ago. it was monroe doctrine, state of our backyard, sovereignty. the chinese even though they have problems with trump personally, they really like his approach to foreign policy and it's very different from the american approach historically to the world of indispensability. >> before we let you, go i would like to come back to iran for just a moment. what do you think is going to happen to their economy? are they going to be shut off from the world oil market? and what will conceivably be the impact if you are correct and the other parties to the agreement are unable to really engineer any sort of work around. >> they won't be completely cut off but they've reduced their purchasing by 20%. that's different than what the chinese said they would do several months ago the chinese showing they want to get to a deal with the

americans. i think that overall the iranians will lose over a million barrels of crude a day after these sanctions snap back on november 6. the question is when the deal dies, no matter what all of american allies say about it and, again, mike mcfaul is right, all of them oppose the u.s. on this, are the iranians going to get more provocative on cyber attacks against the saudis what will they do in terms of military posture in supporting proxies on the ground, the houthis in yemen what will they do with the straits of hormuz which they've made rhetorical threat about all of these things are significant, open questions and will inject political risk into the oil price. one of the reasons people are talking about perhaps trump throwing oil from the strategic petroleum reserve on the market soon. >> that gets talked about seriously? >> it does. >> finally ambassador mcfaul, we focus on the trade side of the policies as we watch these world leaders, the new protectionist stance of

the united states against the world, do you see that having any real lasting impact on our diplomatic relationships >> well, on the one hand, you know, i think ian is right that trump's bluffing and tough talk leads to marginal better outcomes i think they're pretty marginal. to announce we have a brand new deal on south korea is a giant overstatement but he's firestone that rk -- prone to that. he said he's done more in two years than any other administration the long term is, will we be able to continue that kind of strategy for years and years to come it's all about zero sum transactions and winning in the short run, but does that lead to the long-term breakdown in trade and multilateral win-win outcomes i don't know the answer to that. i think it's a dangerous game, especially with the chinese, but i think it's too early to judge. >> we'll leave it there. ian bremmer, ambassador mike mcfaul, thank you both.

>> thanks for having me. when we come back, a busy day on wall street we'll continue to watch in anticipation of the fed decision this afternoon, talk to former chairman of council of economic advisers jason furman. plus, record engagement, nike beats the street but shares are down almost 3% we'll talk about what's spooking investors is the dow ilos st some early gains, "squawk on the street" is back in a moment. this isn't just any moving day.

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stocks are mostly higher off their highs of the session investors seem to be shaking off the simmering global trade tensions and looking ahead to the federal reserve interest rate decision. joining us now, jason furman, former chair of the economic council. and michelle meyer, congratulations on baby max. we'll start with you today is pretty much locked up as far as an interest rate hike. the question is, what clues will you be looking for as to the path of interest rate hikes from today on >> i think the dots will be front and center as well as comments from fed chair powell so for the dots, they're going stay with the four hike this is year if anything there will be a conversation around that medium so more and more fed officials will be convinced yes, they can execute one more hike after

today's hike. >> december. >> exactly the december hike. and i think next year will stick at three we'll get 2021 dots and the long-term dots are interesting. >> what does that mean this is the projections of the fed members of how many hike there is will be next year >> right and beyond so i think we're getting an interesting conversation as to what is the end game how high can rates go? what is that terminal rate increasingly, fed officials are signaling it's getting higher. they think they can see restrictive policy which means they'll bring rates above whatever they can stay at long run neutral to be. >> do you agree with the fact that the fed can stay on auto pilot raising rates with this economy looking strong and shaking off the impact so far of the tariffs? >> look, i agree with michelle we're going to see a rate hike today. we're going see a strong signal about one more thisseer. that's appropriate with the unemployment rate low. year.

that's appropriate with the unemployment rate low. interest rates will be accommodative even with two more hikes this year as they should be because i think we should push more. i'm less worked up over what the dots show for next year and theeer aftth year after the fed has no idea what it's doing because it will depend is some temporary or will it keep building? are we going to finally see the wage momentum we've been counting on? is the trade war going to get worse and start hurting the economy? what do we think our star is all of that is going to play out over the next year they don't know and their decisions will depend on all of those types of factors >> does that mean, jason, that you expect the word accommodated to remain? at least today >> i expect it to remain because they're below their estimative

neutral, they're below everyone's estimative neutral so we have a fiscal policy that's expansionary and a monetary policy that's expansionary fiscal policy will be less expansionary next year, so will monetary policy and it's possible we're executing a smooth landing of the type that historically we haven't been able to engineer but maybe this fed has been able to do it >> hang on, i think we have news, david on sky. >> you saw it at the bottom. we wanted to tell people that in a filing, and i've confirmed it as well because sometimes these things can be confusing, fox has decided it will, as many expected, sell its 39% stake in sky to comcast if you recall, of course, over the weekend a significant battle between comcast and fox took place in which comcast prevailed at a price of 1728 in british pounds give than price, fox is taking advantage of it to sell the 39% stake in sky that it has held

for quite some time. of course it came out on the losing end of trying to buy the 61% that it didn't already own originally had a deal to acquire that at 1075 and subsequently with the back-and-forth getting as high as 1728 a price at which it will sell that will be significant proceeds to fox and hence its inquirer of disney when this deal is completed, perhaps as much as $15 billion, given that 39% stake. but we wanted to share that with people again, fox will -- there had been some question, perhaps, that they might hold out for a higher price -- sell the 39% into the existing tender from comcast at 1728. as we're talking, we have a little shot of -- make it big there, president trump walking into the united nations this morning. he is there to chair the security council, the most powerful group of the u.n. u.s. holds the rotating presidency of this group and they are set to be talking about iran and non-proliferation

there you see him with ambassador nikki haley, his ambassador the united nations. his secretary of state mike pompeo, and we will continue to monitor this and bring you any headline wes get from the president at the u.n. this morning as soon as we get that let's get back to the economy and the fed. it's fede and t eefed day. where is the market tracking >> we think the fourth quarter could see something comparable part of that is that we have a pretty favorable backdrop for inventories. they were a drawdown in q-2 because we have strong consumer demand so we could see inventory rebuild in q-3 and into q-4. >> is consumer confidence has been amazing, jason. inflation is rising, home prices are increasing slower rate hang on, let's listen to president trump first. >> the security council is

called to order. the agenda is maintenance of international peace and security, non-proliferation of weapons of mass destruction, the agenda is hereby adopted i am honored to be here today to chair this meeting of the united nations security council it is also my privilege to welcome the distinguished heads of state, heads of government, ministers and other leaders and representatives here with us thank you. i wish to warmly welcome secretary general antonio guterres for joining us. thank you very much, mr. secretary general.

the security council will now consider item two of the agenda. i will make a statement in my capacity as president of the united states of america it is a great honor to be here today at this u.n. security council brief iing to discuss a matter of urgent importance concerning and counter iing the proliferation of chemical and biological deadly weapons and the means to deliver them. the nations of the world have long recognized that certain weapons are so dangerous and can inflict so much suffering that all of us have a vital interest in preventing their further development, spread and use.

since my inauguration the united states has taken bold action to confront the sinister threats. many of us are rightly focused on the dangers of nuclear weapons but we must never forget the risk posed by biological and chemical weapons the united states was one of the first nations to unilaterally renounce the use of biological weapons and since world war i we have led international efforts against the scourge of chemical warfare. most recently in syria, we have twice imposed severe consequences on the assad regime for using chemical weapons against innocent civilians. i want to thank prime minister may and president macron for

their countries' close partnership in those efforts last april the syrian regime's butchery is enabled by russia and iran the iranian regime exports violence terror and turmoil. it illicitly procures sensitive items to advance its ballistic missile program and proliferates these missiles all across the middle east. the regime is the world's leading sponsor of terror and fuels conflict across the region and far beyond a regime with this track record must never be allowed to possess a nuclear weapon for this reason, i announced earlier this year that the united states would withdraw from the iran nuclear deal this horrible one-sided deal allowed iran to continue its

path towards a bomb and gaive te regime a cash lifeline when they needed it the most they were in big, big trouble. they needed cash we gave it to them in the years since the deal was signed, iran's aggression only increased. the regime used new funds from the deal to support terrorism, build nuclear capable missiles and foment chaos following america's withdrawal, the united states began reimposing nuclear-related sanctions on iran. all u.s. nuclear-related sanctions will be in full force by early november. they will be in full force after that, theit the united sts will pursue additional sanctions tougher than ever before to counter the entire range of

iran's malign conduct. any individual who doesn't comply will face severe consequences i ask all members of the security council to work with the united states to ensure the iranian regime changes its behavior and never acquires a nuclear bomb with all of this said, i want to thank iran, russia and seyria for, at my very strong urging and request, substantially slowing down their request on idlib province and the three million people who live there in order to get 35, tloir000 targed terrorists get the terrorists, but i hope the restraint continues. the world is watching. aung also to turkey for helping

to negotiate restraint anything the usa can do to help resolve this problem in order to save perhaps even hundreds of thousands of lives, maybe more, we are willing and able. we are available to help in my remarks yesterday to the united nations general assembly i laid out my administration's commitment to building a more just and peaceful future regrettably, we found that china has been attempting to interfere in our upcoming 2018 election coming up in november, against my administration. they do not want me or us to win because i am the first president ever to challenge china on trade. and we are winning on trade.

we are winning at every level. we don't want them to meddle or interfere in our upcoming election as i also mentioned yesterday, we have seen the results of historic efforts to open new pathways to peace on north korean peninsula on the korean peninsula, and at that's something we are extremely proud of i am pleased to say that north korea has not conducted a missile test since last november it has not conducted a nuclear test since last september and the hostages have been returned to us and, very importantly, the remains of american heroes are now returning home in june, i held a historic summit with chairman kim jong-un in singapore where he reaffirmed his commitment to complete

denuclearization last week, chairman kim reiterated that commitment to president moon at their third summit and to me in a very strong letter form i think we will make a deal but unfortunately to ensure this progress continues, we must enforce existing u.n. council resolutions until denuclearization occurs. however, we have detected that some nations are already violating these u.n. sanctions this includes illegal ship-to-ship transfer which is must end immediately the safety of the korean peninsula, the region, and the world depends on full compliance with u.n. security council resolutions. very, very important

but most importantly, i believe that chairman kim jong-un, a man i have gotten to know and like, wants peace and prosperity for north korea. many things are happening behind the scenes away from the media which nobody knows but they're happening nevertheless and they are happening in a very positive way. so i think you will have some very good news coming from north korea in the coming months and years. i also very much appreciate what president moon of south korea had to say about me last night in television interviews working with president moon has been my great honor and like wise, working with president xi of china and p.m. abe of japan has been a pleasure and an

honor. each of us follows in the footsteps of countless world leaders diplomats and public servants who came here to the united nations with the same noble goal -- to build a future worthy of the waits, trpatriots true patriots who sacrificed their lives for our nature and for our future to be successful, we need a commitment of every nation represented in this chamber acting together. we can replace the horrors of war with the blessings of safety and the beautiful promise of peace. thank you very much. i now resume my function as president of the security council and give the floor to the president of france.

>> translator: thank you, mr. president. >> that is the president chairing the meeting of the u.n. security council the headline there obviously the president accusing china of, in his words air, tem his words, attempting to interfere in our upcoming 2018 election they don't want me to win because i'm the first president to ever challenge china on trade. went on to talk about kim jong-un of north korea, a man i've got on the know and like. eamon javers, this is a new development in the on going discussion of foreign policy and a new wrinkle in the trade dispute versus china. >> absolutely. it's a big claim by the president of the united states we'll see what proof the proof the administration puts out. but the president said china is attempting to interfere in the 2018 elections because they don't like him, they don't like his china and trade policies and

they don't want him or his party to win in november so the question is what is the president specifically referring t to the chinese have put in place tariffs in response to the president's tariffs that targets specific industries. the chinese are aware of specific regions of the country where those industries take place and they are aware of the politicians who represent those regions of the country and they're trying to put political pressure on those politicians to cause political pain in the midterms that will entice them to stand up to president trump on the tariff issue. that could be at least part of what the president is referring to the president also said kim jong-un of north korea is a man he has come to know and to like and he predicted good things coming on the korean peninsula the president has been talking about another big set piece meeting, a summit with kim jong-un. we'll see when that happens. some prediction at the u.n. that that could happen as early as

october and we'll see if we can get more details on that all of that pointing us to this afternoon's press conference in manhattan. we expect the president will get questions on these topics and perhaps be able to provide more clarity on where these things are headed, carl. >> eamon, i couldn't help but think of the axios report out sunday from jonathan swan saying the administration is planning a secret major administration wide broadside against china which is both going to be restore cal and substantive. it will be administration wide led by national security, treasury, commerce and defense is this what that is do we know anything else about that strategy? >> well, it's hard to say whether this is part of a broader strategy or not or whether this is a one off accusation there have been hints of this over the past 48 hours in washington but this is the biggest platform which the president has asserted anything like this so we will talk to the white house and get more

guidance on what they're claiming is this just to do with tariff retaliation or are they talking about something more specific and detailed we have to get more information from the white house before we can be sure where this fits in the broader piece. >> eamon thanks. eamon javers the markets not rattled too much by this rhetoric dow is hanging on to a moderate gain after the president's comments at the security council meeting just now of course we have the fed decision in just about three and a half hours we have the blackstone vice chairman of private wealth solutions, always a good person to try to get his take on. byron, good to talk to you, thanks for the time so we have the president accusing the chinese of attempting to interfere in the midterms. the chinese today are cutting tariffs on non-u.s. imports trying to make it easier on their own consumer base. there's a military dimension where they're complaining about our sale of arms to taiwan is this getting more serious or not? >> well, i think trump is right

to be tough on china it is getting more serious trump is determined to get a deal out of china that levels the playing field on trade and i think he's going to get it. >> as an investor, do you have to take certain precautions if this is going to get worse sounds like you're predicting it's going to get better >> i'm predicting it's going to get better and i think the market is anticipating that. it may get worse first but i think china's economy is slowing. i think it's in china's best interest to work out a deal with the united states and it's in our best interest to work out a deal with china. i think you can only fight a limited number of battles at any one time i don't think we should fight with canada or mexico or europe. china is the one where the

inequities are greatest and i think trump is right to concentrate on getting a better deal out of china. >> so you would prioritize china then canada then eu? i guess on the list of fires we have burning here, you want to see china put out first? >> right china is the only real fire. the others are glowing embers. >> very nice. >> do you think the market has this right, byron? it sounds like you're optimistic of how this is going to turn out. is the market right to shrug it off and make new highs despite the fact that we are seeing tariffs implemented on both sides and that could put pressure on consumer prices and drive them up. >> all those are negative bus the economy is in a very powerful position right now.s b the economy is in a very

powerful position right now. i said the market would reach 3,000 on the s&p 500 and it would do that in spite of four fed rate hikes we're going to get four fed rate looirks as your earlier guests have said and my belief is we'll still reach higher. >> byron, to sara's point, we've got the prospect of further tariffs raising prices. we've got a trillion dollar budget deficit, a huge tax deal that generated it, conceivably fiscal stimulus, we've also got a budget itself that's larger than it's ever been. at some point aren't we going to see signs of inflation that get people scared and start to send that ten-year even higher? >> i think the ten-year is going to go higher but only somewhat

i think inflation is going to go higher but again only somewhat higher i'm sort of on the cautious side or positive side of inflation. i think both inflation and interest rates are going to rise, but not much my own feeling is that next year growth in the u.s. will be somewhat off the current pace and earns will grow but not as much as they are this year so next year won't be as bully of a year as 2018 but it will still be a good year. >> i know consensus estimates on gross margins are going go from 11.9 this year to 12.5 this year, 13.2 the year after that, byron. so people are working through how much pricing pressures will affect at least margins of earnings then you have trim tabs saying insider selling in september at

its fastest pace in almost a decade can you blame those for who would want to get out of the market for doing so? >> those insiders know what the numbers are and you're right to pay attention. my view is that the pace of growth in the -- the pace of growth in the economy and the pace of earnings growth and margin pressure will be evident next year. >> byron, america first theme not just playing out at the u.n. but it's in the starock market the relative performance of the s&p 500 at the most extreme level since 1970 what do you do with a statistic like that? do you keep buying the u.s. or do you go around the world where valuations are much cheaper? >> well, i think the u.s. is still attractive the multiple is not swollen to anything like we saw in 2007 or

1999 we're still only at about 18 times earnings for next year my feeling is is that there are good values around the world but the economic situation around the world is not as favorable as it is in the u.s so europe is lowing. the emerging markets are slowing but i think a buying opportunity is developing in the emerging markets. >> really quickly before we let you go, byron. we've had brent at 82, draghi came out and says he sees relatively vigorous underlying inflation in the eurozone. i guess -- doze do those two trends continue? >> absolutely. at the beginning of thee year i said west texas would reach 80 >> is we got a sneak peek of

next year's forecast when we come back, shares of nike falling today despite a beat on earnings we'll tell you why "squawk on the street" will be right back with the overall dow up 35 points ♪

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welcome back to "squawk on the street." shares of dow member nike are falling despite delivering a 10% rise in sales, more than 20% growth in china, higher margins and second-quarter in a row of growth in north america. also for the first time, ceo and chairman mark parker addressed the impact of that controversial pick of colin kaepernick for the face and voice of the just do it ad campaign. listen. >> it's driving a real uptake, i think, in traffic and engagement both socially as well as commercially we've seen record engagement with the brand as part of the campaign. >> basically, guys, as far as the market reaction, which is now off its lows and now only

down 1.4%, it's nothing investors didn't know as far as the nike results and, frankly, the impact of colin kaepernick the stock had run up to a record high, best performer in the dow, it's now been bested by microsoft but still up 33% it had become a consensus trade. it also has had a historically very high valuation right now, trading at more than 31 times next year's earnings, the highest i've seen in the a long time but big picture, nike likes to talk about the fact that this can continue it will be driven by innovation, a lot of investment in their direct-to-consumer business, especially digital and what that equals, according to the analyst this is morning, is higher margins and that is something to get excited about. for now, looks like it was a case of high expectations. >> so establishing a relationship directly with the consumer for from their own platform, not others not necessarily from amazon but from a nike platform itself. >> yeah.

they're going at in the a number of different ways but, yes, the growth is in so-called dtc, direct to consumer but they talked a lot about relationships, jet.com, they talked a lot about china. >> walmart and alibaba. >> wholesale is a huge business for nike but the growth is happening else where and that will be interesting to watch the impact on foot lock cher which tends to move in sympathy with nike they have new stores opening in new york which they're teasing up the only other point i would mention as far as what could go wrong, nike mentioned the stronger dollar as a result of geopolitics and trade is going to start to flip into a head wind starting this quarter it's been a tail wind. so that hits with the lag. it's one reason they said they didn't raise guidance, they maintained their guidance because that will have an impact nike is such a global business. >> not a surprise dollar index highest today in about a week or so let's get to the cme group

in chicago and check in with rick santelli. good morning, rick. >> good morning. i'd like to welcome my guest this fede morning. chief economist vincent reinhart thanks for joining me. it seems a fait accompli we'll see a rate increase, third one this year for a range of 2.25% your thoughts? >> we're old enough to remember when fede was exciting it's not going to be on the funds rate, the quarter point is a lock how do they characterize policy accommodations they are raising the funds rate. what they do with the dots do we see the longer run estimate of the appropriate funds rate drift up a bit and how powell handles himself in a press conference because he'll get a whole lot of questions about president trump and trade. >> you mentioned two things and we're going to get to them in a very strange way there are some new faces

you mentioned dot plots. some people will be doing them, but from a different vantage point regarding what hat they wear, whether it's mary daley or john williams. tell us about the new faces and how they fit in with fit in with the powell philosophy. >> well, remember that rich in his role at pimco owns the idea that we're in a new normal and the appropriate funds rate is low. i don't think he's as low as some of his colleagues so i expect a little bit of drifting up the cost of that. now, mary daly was the director of research for john williams, and so she was overseeing the research that john -- and collaborating with williams, so i think that's just two dots that are the same, hers and williams we know john williams' record. he's done a lot of work on

estimating the equilibrium funds rate back when we both worked at the federal reserve board. i would expect a little drifting up of the dots importantly because we got a lot -- we're tracking 4.25% gdp growth in the third quarter. since the last time they did it, they revised the gdp all the way back to 1929, and that would suggest a little stronger number >> you know, vincent, i find something really interesting, and maybe we'll put a light on something. many pay overlehiy high attentin to the hyperbole of this president. it seems like the hyperbole of the fed is, hey, i'm a low interest kind of guy but on the action side it doesn't seem he's putting those in action. that's an important political distinction, isn't it? >> i think it's very important it applies to the fed but it's also administrationwide in terms of a lot of the first level

appointments got a lot of scrutiny, but the second level appointments and lower are really scoring high on competence for the fed -- >> excellent. >> -- the administration has been jay powell's best friend. >> excellent it's always interesting -- we're just about out of time but i liked your experience with the fed to be able to make that statement because nowadays it's really difficult to look at topics without being tainted by politics vincent, thank you david faber, back to you. >> thanks for having me. >> okay, thank you, mr. santelli now time to send it over to jon fortt. let's get a look at what's coming up on "squawk alley." >> well, he is owner of "the l.a. times" and part owner of the lakers he's got a new battery out that could compete with elon musk and tesla. we'll hear from him coming up. [ upbeat music ]

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afternoon. among the names leading the group to the upside, facebook, netflix and video game makers, activision and blizzard arts shares of viacom are higher by more than 3% after another analyst upgrade, citing momentum for media consolidation. the firm says viacom and cbs are next on deck for m & a i'll send it back down to you guys. >> leslie, thank you. coming up later today, agriculture secretary sonny perdue will be on talking tariffs, the farm bill, subsidies, that's on 3:30 p.m. we will also have some post fed analys analysis. when we come back, the billionaire entrepreneur owner of "the l.a. times" is with us the dow is up 51 "squawk alley" starts in a few

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it's 11:00 a.m. on wall street, and "squawk alley" is live ♪ good wednesday morning, welcome to "squawk alley." nasdaq is up well over 6% quarter to date. it's on pace for its best quarterly performance since the first three months of 2017, although its first negative month since march as we continue to watch the pressure build on big tech take a listen to mark talking to jim last night about facebook. >> we have given a hug