report about corporate cards and strip club visits. we have the details and the company's response it's tuesday, november 6, 2018 feel like i'm out on the green just reading this. "squawk box" begins now. ♪ live from new york where business never sleeps, this is "squawk box." good morning welcome to "squawk box" on cnbc. i'm becky quick along with joe kernen and andrew ross sorkin. let's look at u.s. equity futures. right now things are in the red. dow indicated down by 44 points. s&p off by 6 the dow and s&p turned in positive sessions yesterday. the nasdaq was down as apple was down again this morning it's indicated down by another 25 points

we've had 18 midterms since world war ii one-year later every single time stocks have been higher, on average by 17% if you look from the yearly low the year earlier, they are up averaging about 32%. we'll see what happens today and then over the next 12 months let's look at what happened overnight in asia. the nikkei ended up by 1.1%. hang seng was higher shanghai was down by a quarter of a percentage point. if you look at what's happening now in europe, right now red arrows across the board. mostly fairly modest declines. italy and spain both down. spain is down by close to 1% treasury yields, look and you'll see the ten-year now is yielding

3.193% crude oil prices, which settled down barely yesterday, settled at 63.10, the lowest settlement in seven months. this morning down 22 cents to 62.88 even as those actions on iran were imposed. something is happening today, a little thing called the midterms we don't need to introduce him he needs no introduction eamon javers is in the house on the set. >> i'm wearing my jar kcket agan >> understood. >> if we talk, you want to ask me a question, can you scream it at me rudely >> sure. >> and i'll ignore you midterm elections, this will be fascinating first midterm election of the trump era. we'll watch the house and senate races. look at the house of

representatives, the democrats are feeling momentum they think they might have an opportunity to take back the house of representatives they need a net of 23 seats here watch for races all afternoon and into the evening tonight in terms of the suburban area where you get a lot of swing voters, maybe some republicans frustrated with the performance of president trump, that's where the democrats think their sweet spot is in the house look at the senate, current balance of control, there are two independents in the united states senate. so the democrats need a net pick up of two seats here you think only two seats, that's easier than the house, actually it's thought too be to be harder because red state democrats will be the key there if democrats can pick up the senate, that's going to be a bit

of an uphill climb ultimately there are expectations built in, but we should start the day with a big dose of humility, where a lot of people thought they knew what was going to happen, they had no idea we have no idea what will happen tonight. >> we did have the conversation in makeup. you always want to try to say something definitive, so you can say you called it. >> are you making your call? >> i don't have a definitive feeling for it i said to you knowing what happened in 2016, if it was just donald trump i would think he could be underestimated. knowing all politics are local, all of these house races, there's so many local things that go into it -- >> when i was a young reporter

on capitol hill, all politics are local. each district is different that's been turned on its head this year. i think all politics are trump >> the president also said he virtually fools like he's running on the ticket. >> look at the governor's races in georgia, florida the senate race in texas, in missouri, mccaskill, north dakota. >> i think the gubernatorial races will be important to watch. republicans control about two-thirds of that >> they're all compelling. >> to me the gubernatorial races may be different that might be a truly local issue. >> it's about medicaid >> absolutely. gubernatorial for our purposes, following financial markets and the fates of companies that i be

less important house and senate you will deal with tax policy, trade the governors don't have as much say. in terms of corporate performance you're looking at thehouse and senate here >> gubernatorial and state houses will be able to determine redistri redistricting after the next census >> after september 11th, during that midterm, there are cases where a president can do okay in a midterm. after the monica lewinsky candle, bill clinton did well in the midterms >> if the house goes, which everybody seems to think it's going to, i don't know how adam

schiff can be on tv more than he already is on. i don't see how the magnifying glass on trump can get more powerful but it will. >> they have the power of subpoena maxine will be head of the finance committee. if they're looking for things to get better -- >> will the democrats be able to get the president's tax returns? they'll have subpoena power but need a trigger in order to do that will they go for that? >> they'll be in court the whole tim time this is like the comment that newt gingrich said, whether

kavanaugh is worth it or not >> yeah. >> if the senate stays, that's where the judges come from and that's where the ultimate decision on any of the -- if there was an impeachment, if the senate stays, the parties overplay their hands, and if the democrats overplay it in terms of that's all we hear about, if it doesn't do anywhere because of the senate, who knows if it plays into his hand in 2020. >> starting this time tomorrow morning the thick ng to watch is the mueller investigation. there's been a pressure on mueller not to do anything dramatic before the elections. >> you saw the subpoena story in politico, which i believed until they denied it they're now saying roger stone,

donald junior. >> you could see indictments of people like roger stone. that's possible to put into the mix. >> they have to say no >> his attorneys have said no. politico did a fascinating piece laying out the case for it may have already happened. >> will you stick around i'll be at englewood -- >> no, no, for this other story. you'll stick around for that >> yeah. >> joe would like you to read prompter for him for that. >> everything. any way, let's talk about the markets. chris retzelr joins us now also joining us is andrea

cramer welcome. chris, one thing that i mentioned to eamon in makeup was that i guess i figure consensus could be right in this i read your market analysis. it's pretty close to consensus, which means it's not going to be right but it's certainly what people think earnings growth will slow paw of comparisons when it was growing at 23% can't do that. even 10% is not bad, right a split congress would be gridlock and as becky pointed out year after midterm is almost always positive >> always. for the last 18 time since world war ii >> we'll look for consumer confidence impacted. are they going to roll back a

lot of benefits we've gotten in the last two years we've gotten mostly through the earnings season, but we are talking about china and the tariffs. november seasonably and into the new year, it's generally a good time for small cap companies we've been watching the high yield market it's holding in there. if it continues to deteriorate, that would show a caution. what comes out of this election, they could turn. a resolution comes out of it, which in your view is something. then uncertainty has been removed. that's all you need. >> it's a positive for the markets. we are trying to gauge that. what we know tomorrow is we'll start the 2020 election all over again and start that going

forward. >> boy >> again, how does the confidence get impacted. do they move to subpoenas, cause a headline, change the discussion >> what is the discussion -- or what are the changes you're hoping for that you thought would happen in the next two years that somehow aren't? >> we want to continue to see a pro business environment people know what they invest in they can get a return on they will not be overly taxed. so they have some certainty to make larger vinvestments in capital equipment, industries or other investments on confidence. >> but the taxes -- what are you arguing will happen? i understand the noise factor of all these other pieces to it but i don't understand the actual things you think will happen >> businesses make investments based upon multi-year plans.

we're not talking about the next couple of quarters where they might be worried about taxes if you have a roll back two, three, four years out, that might change how they're investing. >> he's a small cap guy. let's get to andrea. you're a vix person. we're in the middle of a range that you think might determine the eventual outcome on the high side, exactly 2515, and on the low side what is it >> on the low side below 1866, which is half of this year's closing high that could determine which way we swing considering the commitments of traders, data indicates that large speculators are long vix

futures. this group has been notoriously wrong at extremes. it wouldn't be bad bet to bet on declining volatility in the short-term >> so volatility continues but you can't determine whether we made a decent bottom >> yeah, the jury is out on whether we found a bottom. but seasonality favors the bulls, not only is the november through april period strong for the stock market, but looking at data since 1950, the s park x has been higher 100% of the time six months after midterms which is way stronger than off years or after presidential elections. we have that working for us. another thing under the radar this week at least with the midterms dominating headlines is

the fed meeting. probably because the fed is not expected to do anything. that also has bp bueen bullish stocks what's the vix telling you about whether it's dewine or -- do you know who is running in ohio? cordray? are you going to elect that guy governor he was an ambulance chasing attorney general in ohio are you going to elect that guy? will ohio do that? >> i think we learned our lesson in 2016 about not to speculate what does the vix tell you you're in ten ten any way, why

am i asking you. >> thank you >> you like small caps, that's the bottom line. that's what you cover. >> good time to be in them >> thank you. when we come back, fallout from the trade war we'll take you live to china where eunice yoon spoke to the ceo of starbucks right now a look at premarket winners and losers in the dow. intel leading the way up by 0.8% cal: we saved our money and now, we get to spend it - our way.

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welcome back to "squawk box. amazon will reportedly split its new head quarters between two cities this time the retail giant is nearing deals with crystal city,

virginia, and the long island city neighborhood of new york city other reports say splitting the new hq between two cities is appearing more likely but the cities have not been chosen. now that we're down to potentially two and naming names -- we thought crystal city might be that the crystal city people were giving away more information. >> the note from an amazon executive yesterday said whoever is taking, you may mick us go away >> interesting they would do long island city >> and then the question is this really an hq2 or just satellite offices. >> if you break it up, it's no longer that. >> i'm not on the l.i.e. much, but when i am i wish i wasn't. i can't imagine -- >> extra traffic

>> you go out there sometimes, to the hamptons. helicopter yes. i'm thinking that ride won't be pleasant >> the l.i.e., when i'm on it, i wish i wasn't. >> i can say that about a lot of roads. 495. >> the weather and the traffic almost -- >> cancel each other out >> almost do not kidding. watching shares of apple suppliers falling sharply in asia overnight after reports said that apple told them to can s cancel plans for the new apple xr production line a report sparked concerns that the iphone xr is facing weak demand >> which one is the xr >> the cheaper version that i thought would have a lot of volume on it

multiple colors, but almost as good as the higher end verg of the phone. >> i would have saved five years of my life in l.a. if i had google hams maps or waze >> do you know how much that has changed neighborhoods that used to be quiet and how people are flying through there >> but now with elon musk -- >> with the xwoeriboring compan under armour is under fire for new details about its corporate culture. the "wall street journal" reported that the company stopped letting employees use corporate credit cards for paying for visits to stru strip

clubs. the "journal" says several female employees are accusing several top male executives for inviting women to things based on their appearances kevin plank said the story is tough to read and that the company will own its truth he said we can and will do better inappropriate behavior that challenges our values or violates our policies is unacceptable and will not be tolerated. shares of under armour have been up, they were upgraded they were upgraded by one house in the last week or so right now 24.30. what's surprising is not the

news this was happening but just that a letter went out this year >> about ten years two late, maybe 20 years too late. >> within the sporting world, we saw this happening with nike nike's culture, they went through their own roller coaster ride not over strip clubs, but over -- >> difficult environment for females to be working in >> still some things around. whenever i see hooter's advertised -- >> i can't belief thove those p still exist. >> remember entourage? >> yeah. >> and sex and the city.

they don't age well. remember, we had dick parsons on one time talking about how the line moved and moved quickly >> this goes back to the debate this year about cheerleaders in the nfl. where is the world moving? five years from now i imagine there won't be cheerleaders. we have to go to china it'shosting a massive import expo hoping to demonstrate to foreign companies it's open for business despite the trade war eunice yoon is in shanghai an spoke to kevin johnson, the ceo of starbucks >> this is the same starbucks roastery you were at less than a year ago this store sees 8,000 visitors every single day compare that to a typical store in the united states of 400.

it's no surprise that the biggest starbucks is here in shanghai this is the market starbucks is focussing on for the future. there is an ongoing trade dispute between the u.s. and china. i asked kevin johnson if he's seeing impact on the business here >> there's always something going on in geopolitical relationships, and the geopolitical situation we learned to navigate those things what's happening now in the geopolitical situation, we're not immune to it but we're not seeing it impact our business. and we're staying focused on things that we do well >> johnson said despite the trade dispute there's no reassessment of starbucks commitment to this market. their focus these days is on delivery food delivery is huge in china back in august the company talked about an initiative with

alibaba, where customers can now go into a starbucks app and they can have starbucks coffee delivered to the home within 30 minutes. >> we reengineered the packages to separate hot from cold, and we worked to make sure when the customer delivers that food or beverage, it is the same temperature as if the bar rest ta just hand barista just handed it to them >> about a third of the stores here offer delivery. they plan to increase that to 2,000 by the end of the year johnson also said the innovation he's seeing in china and this technology is so interesting they could leverage that and use

it for digital strategies in other countries like the united states >> eunice, any sense from kevin johnson in terms of the relationship -- starbucks always had a remarkable relationship with the chinese government. it's one of the few american country that no longer has a joint venture with a local partner. given the trade dispute do they have anxiety that the trade relationship could change or that growth plans would be slowed down? any obstacle coming as a result of this fak aback and forth tha been taking place? >> johnson didn't say that to me today there are several government officials who have been coming into this store. earlier today i saw him walking around he was talking to didn't officials from various places.

that relationship with the government is important to starbucks. you mentioned the potential risk to starbucks or any company in this trade war the chinese government in the past several years that had incidents where they get into a dispute with another country and then there's a business problem with -- there's a problem with some businesses from that country. we've seen that with south korea, in japan. because of that, that's still a tail risk for any company operating in china at the same time johnson reiterated that even though this company is not immune to these problems he doesn't think it's going to have any effect on their overall business here. >> okay. eunice yoon, thank you by the way, behind you they serve tea.

>> i'm in front of the longest coffee bar in the world. over there, there's a massive tea bar. after this conversation i'll have yet another coffee, because i don't have enough energy as it is i also will get some tea >> then go downstairs and get the pizza. >> i already ate the pizza i already had two. >> okay. good eli lilly out with quarterly numbers. the drugmaker earning $1.39 a share. the street was looking for 1.35. the company coming in with revenue better than expected probably more important is that the company is raising its guidance for the full-year adjusted earnings per share, now looking for $5.55 to $5.65 a

share. also looking for slightly higher revenue for the full-year. now saying that it sees 24.3 billion to 24.5 billion, versus the 24.39 billion they expected th >> the sales were up 7% that was on a 12% rise in volume. so they'll make the point it's not from li higher prices the oldest mate for the year was 5.48 now this 5.55 -- they raised the lower end of the guidance by 15 cents, the higher end by 10 cents. >> after beating by 4 cents today. >> they introduced ten new drugs

since 2014 david ricks will join us and talk about the prices on the drugs being down and it being a volume increase. he doesn't like the new proposals. >> not many do >> we'll see about that. coming up, mark grant will join us with a closer look at the reactions to the midterm as we head to break, a look at yesterday's s&p 500 winners and losers every investor should ask questions. is our money in the right place? what am i really being charged? and is it eating into my returns?

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♪ welcome back you're watching "squawk box" live from the nasdaq market site in times square. welcome back stocks to watch, toyota raising its full-year profit forecast. in this case citing a weaker yen. quarterly earnings rose 11%. marriott cutting its current quarter forecast for rev par, in plain english, revenue per available room

there's so many different rooms. if you don't know, it could be one of those tiny rooms. >> or a big suite. >> like when we go to davos. your feet hit the -- at the end of the headboard it's not that they're off the bed, they're touching the wall >> i'm not quite as tall as you. >> as i'm watching law & order in german. ♪ any way, per available room. marriott blames weak demand. >>and mylan -- it's coming again. >> davos >> yeah. and mylan shares are rising after posting better than expected results in the latest quarter. the company telling investors it has no timeline for evaluating strategic alternatives in august, mylan set up a committee to look at options citing a tough u.s. environment for drugmakers

you know what yesterday was? >> november 5th. >> my son has these crazy metrics. exactly halfway through trump's first term >> and yesterday was also -- i heard this on the way in, ten years to the day since barack obama was elected. >> you're through two years andrew >> yeah. >> time flies when you're having fun. it's going fast, right each day from here -- the second half of things go faster you know how you go on a trip, you drive there, you go we're never getting there. you drive back, oh, we're back i'm worried about 2020 for you >> we haven't even made it through the midterms >> i've moved on to 2020 at least they'll give us a break on the ads have you seen enough of those ads? >> yeah. >> sometimes they run the one

guy's, and then right after the other. i like the one in new jersey one guy claiming he was -- the other guy was with 14-year-old prostitutes. the other side says your guy ran a pharmaceutical company for a profit people at home don't know which to choose. >> the ads are nastier than that they say he jacked up prices -- 1$100 million on the back of cancer >> 14-year-old prostitute or a guy who had a company running it for a profit >> it's new jersey >> oh, joseph. >> let's look at the markets >> which do i choose >> dows are down by 34 points. mark grant says it is dangerous to write about politics but he did it any way the managing director at b. riley fbr discusses the election

on the bond and equity markets we discussed it's good to be a divided house between democrats controlling the house if the presidency is controlled by the republicans. they figure that is gridlock and nothing will happen. you say in this situation it might be a bad thing why don't you explain. >> certainly i don't want e-mails saying resist grant either. but i will explain this. there's three potential major risks if the democrats get control of the house or the senate the risks are impeachment of u judge kavanaugh or president trump, and then rolling back regulations imposed by president trump, and from a market perspective i'm hopeful that the republicans take control of the house and senate what we heard from others is

that it's not a big deal if if the house goes to the democrats. you won't be seeing huge shifts no matter what happens, that the regulatory issues can't got rolled back, they can't overturn taxes, and the democrats may be reluctant to use some of those subpoena powers because it may come back to haunt them in 2020. >> they're reasonable arguments, i'm just more fearful than those arguments make their case. you know, i think by any metrics you want to put in here, this is an economy comment, by any metrics you use, our economy is doing incredibly well. the stock market and the bond markets have benefited from that i hope that we remain in some kind of status quo and the other thing that i hope will change, which is not with these elections, that the fed will

listen to some of our politicians and slow down these rises in rates which i think are totally unnecessary. >> mark, sometimes we get you, you actually make predictions. sometimes you willingly do i wouldn't recommend it this time i don't hear you doing it. you are giving both sides of the slate on what could happen >> right >> would you agree if it was trump running it's easier to figure out, i think, if it was just him it might be easier to figure out the trum p effect because it's only him. to figure out the trump effect on local races, i don't know if you could have a high degree of what it means. if this was trump's election, you could say, yeah, he's getting re-elected because of

the election, but with this, you have no idea nothing would surprise me tomorrow when we wake up do you feel that way do you have a high degree of confidence of what will happen do you want to share that with us >> my honest feeling is that the economy -- i've been on wall street 44 years. the economy continually drives elections. both the midterm elections and presidential elections i think the republicans will maintain control of both houses of congress. the reason is that there are a tremendous amount of people who have been helped by this economy, they have jobs, wages are going up, they're living better, they don't want to j jeopardize it. >> that is a call then but you wouldn't bet your life

on it, i don't think >> no, i would not >> mark, thanks for joining us >> thank you any time coming up, eli lilly out with earnings. we'll show you the stock right now. it's up about 2.5% we'll talk to the company's ceo, david ricks, at 7:15 eastern time coming up, we will talk to thomas peterffy, the richest 'lgehi in florida. wel t s take on the midterm election ♪ ♪ ♪ ♪ comfort.

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. alibaba says it will help global businesses sell 20$200 billion of goods to china in the next few years the company's ceo said he wants to use globalization to bring the world's goods to china samsung is hinting at a big change to its smartphone technology the company has teased fans for years about the possibility of a

smartphone but -- >> like a flip phone >> no, literally the screen folds. >> so like a flip phone. >> sort of >> we may see the first verg sin of one samsung with a folded image of its logo the idea that you can have a glass screen or a plastic screen that folds in half would be an accomplishment and be a change in what the form factors of these phones look like >> they get thinner and thinner, then you fold it in half and it fits in your pocket better >> yeah. >> lego won a lawsuit in china a court ruled that the companies around there had copied the building blocks and miniature figures. >> is this a precursor of a

potential deal, china cracking down on ip theft in his country? saying this gets us back to the bargaining table, here's something we can say we're doing. >> i spoke to someone who does business there, it blows your mind about how it works over there. it's just the way it is. is that fair >> you read a somethiignal like, that's important if the chinese are willing to crack down and say you owe lego 6$650 million what was i goes to talk about? >> we talked right through it. >> was it an nfl thing >> we'll find it later. up next, the governor's race in connecticut has implications for the hedge fund industry. >> that's right. prominent hedge fund managers have been leaving the state in droves saying the taxethe s er

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welcome back to "squawk

box. our analysis to today's midterm elections continues with a look at the gubernatorial race in connecticut. leslie picker is here with the story. >> that's right. the polls in connecticut are already open today as voters seek to elect a new governor 750 hedge fund managers call connecticut home but several prominent names have left in recent years amid two bouts of tax hikes which still didn't close the gaping hole in connecticut's budget and thousands of other residents have left taking just over $6 billion with them. only about half of that has been replenished by people moving into the state now, two businessmen are seeking to reverse that trend, but in different ways democrat ned lamont is focused on trimming small business and property taxes while republican bob stefanowski wants to eliminate state income tax in

the next eight years that's right, eliminate it the president of the hedge fund association bruce maguire says the financial services industry does not typically vote as one block in connecticut, but most of the hedge funds there are hoping for relief from taxes >> maybe the new regime will take a closer look at the tax base and a closer look at the personal income tax rates that have been applied here and maybe if we're lucky we'll have an opportunity to start to roll that back i think it's unrealistic that we'll eliminate the state income tax entirely, but hopefully it'll start a new conversation about that >> now the polls suggest the race will be tight next week andrew and i will be back in connecticut speaking with some of the most prominent hedge fund managers and the new governor elect about how to tackle the state's economic issues, guys >> we got a big list on tap. we're going to talk to ray dalio. we've got jones. >> a good lineup up in

connecticut. but obviously these issues will be, you know, front and center. >> what kind of face is that, joseph >> i just -- you know thoetz sey got a lot of money hit them where it hurts. nobody needs that much money boom, it'll work. >> they tried that then people left the state >> oh, that's right! there's somewhere else they can go where they don't do that! >> florida massachusetts. >> damn. >> why aren't you on the campaign trail right now >> i just watch this to me it's -- >> you should be behind the podium like another -- >> you know what if someone -- if asked to serve -- >> i think even when you're not asked to serve >> all right so you can move? man. coming up, the election effect on the markets you're looking at a live shot of a polling place in wilmington,

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it's election day. >> i do not want to live in rainbow land and you can't make me live in rainbow land! this is america! >> you do not have to live in rainbow land >> you can go to rainbow land! >> we'll talk polling predictions and the market reaction eli lilly reports. the drug maker ceo joins us to discuss quarterly results, drug pricing, and the state of the industry under president trump plus getting defensive a look at the sector that's normally a post-election play and the stocks you need to watch. as the second hour of "squawk box" begins right now. ♪

live from the beating heart of business, new york, this is "squawk box. >> good morning. welcome back to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. let's look at u.s. equity futures. this morning you are seeing the futures down but just barely on an election day, nobody wants to get out ahead of this because nobody knows what's going to happen this time tomorrow. s&p futures down by four both the dow and s&p closed higher yesterday the nasdaq closed down yesterday and it's indicated down another 11 points this morning of course we are watching three big stories today. one, the midterms and your money. the polls are opening up across the country as markets take a wait and see mode for the outcome. we'll talk political scenarios and what you should be doing with your money. under armour under pressure. a bombshell report about the

sportswear maker and number three is amazon considering an hq2 split multiple reports say the company is planning a second headquarters the company has declined to comment. we'll have the details in just a bit. here's what's making other headlines this morning the strong job market will be highlighted once again today with the release of the labor department jolt report it's expected to show job levels remaining. take a look at shares of eli lilly. that coming after the latest earnings beat. also raised its full year earnings forecast. chairman and ceo david ricks is going to join us in just a couple minutes to discuss the latest quarter and outlook and one of wall street's highest stock -- however, the company issued better than expected earnings and revenue guidance for the current quarter.

all right. a few stocks are on the move as well marriott is reporting and results were above consensus $1.70. the consensus was $1.31. however the revenue was below forecast it also cut the current quarter metric due to weak demand in north america. and avis budget missed estimates by 21 cents. the car rental company's revenue came in slightly below forecast. avis budget also narrowed its full year revenue and earnings guidance and we're just seeing earnings from cvs health. the company beating by 2 cents at $1.73 helped by a 6.7% jump in same store sales 37. want to check on the market right now.

joining us now is brian levitt from oppenheimer mike ryan is also here from ubs. we've been having a debate about what's going to happen but also what you're supposed to do with your money as it happens. where do you stand right now >> so i'm not shurp you'ure youe supposed to do anything with your money with the election we are in an elongated bull market they did well under single party rule and barack obama from '09 and '10. we did well with divided government through 2016. to me what's more important is what trade policy looks like this cycle will end when inflation gets too hot and the fed tightens policy. >> so mark grant was on in the last hour. he made an argument that if the republicans lose the house, that is bad for the markets that is bad for the economy.

>> no, i don't think that's the case look like i said before, this market, this recovery started during single party rule under the democrats. and it did well during a mixed government. >> it came back from 50% down. it got back to where it was before the financial crisis. >> i mean, it was -- >> didn't make any headway >> right but a full recory with a divided government so joe -- >> jeff immelt brought ge back from 5 to 15 it was down from 60. he got a 200% increase >> so the point is, look we've had a couple of percent growth, couple percent inflation for a number of years. no fed tightening. the markets did just fine. >> yeah. zero on the fed. $10 trillion in debt added and we never got bo 12% growth for a year >> so joe, what we've done is we accelerated growth here. you're starting to see the growth moderate. you're seeing lead indicators peak in the united states. >> to compare where we are now to single party rule under

obama, the economy we have right now is just like you're smoking something. >> possibly -- >> the reason the deficit is so bad is because it got tripled in eight years, sorkin. obviously we don't need it to go up more. but now it's a spending problem. >> that's what you're calling it i think it's a more balanced way to think about that. >> this isn't a political -- for me -- >> it kind of is for you >> i adhere to the advice of michael jordan he asks why he doesn't take up liberal causes, he said because republicans buy sneakers too it's not a point of whether you're in favor of the political party. the reality is where are stocks trading? how are company earnings doing in my mind with a benign inflation environment, this cycle goes on. and market leadership even in the aftermath of trump's victory was still the high flying growth names in the technology sector >> mike ryan, you believe this >> i tend to agree with ryan

do elections matter? of course they matter. they're not the only thing that matters. but i also say that midterms tend to matter less. there's a lot at stake in this midterm election but when you think about it, what we're likely to see is pretty much what's in line with historical norms the republicans are likely to lose control of the house. but they're likely to maintain control of the senate. we're likely to get this ongoing split. this divided government where you basically have two parties splitting the legislative branch when you go back, how have markets performed during those periods? they've done fine. at the end of the day, i think there are things that matter more the earnings cycle is important. what we're going to see in terms of the regulatory front. which i'll disagree with what mark said earlier. >> mark grant. >> yeah. the regulatory momentum will turn back if we see democratic control. remember a lot of these are controlled through agencies. a lot of this comes through the executive branch so i think it may get slowed a bit. and one place where you could

seed a slowing, for example, is efforts to repeal or revise dodd/frank that could be an area where you see -- >> but both of you are -- you're both kind of saying as long as it's gridlock and none of the positive things that were enacted recently in terms of regulation or deregulation and tax reform, we'll be fine. what if the senate went? the senate and the house went? you'll say that's going to be fine because elections don't matter you're assuming it's an election that doesn't -- >> you'll argue the president is going to be in the white house and still -- >> how do you know he'll be in the white house? >> you could live in another gridlock that's still another gridlocked world. >> the notion is suppose the senate goes. remember there are right now 35 seats up if democrats take every single seat -- >> i don't think it's likely, but i'm saying to say that elections don't matter because they're going to turn out with gridlock doesn't mean they don't matter >> even if they took every seat,

what if they have an impeachment from office, you still need another 12 to 13 republican senators to go along it's unlikely. and if you think about what's likely to happen in terms of tax reform bill that was passed, even if the house and the senate were to vote, i suspect what you'll see is the president would veto any tax reform. >> what we're talking about here is what we've enacted since the trump victory. does it lead to a new high or sustained level of growth? if it does lead to a new high or sustained level of growth. then we'll be in a prolonged period of stronger dollar. we'll unlock some value out of the stronger markets what i'm saying is my expectation is given tightening, given a stronger dollar, the u.s. economy is likely to come back closer to strong growth to me that continues to be a growth market wherever you can find it. i think investors are going to pay up for growth. >> are you of the view that there's any chance the fed lightens up.

>> look, i wouldn't say the recent bout of volatility is going to give the fed pause, but i think it's a conditional response they're not pre-programmed even though they've been going every quarter in terms of the cycle. i do think they are moderating conditions >> political question. do you think it's harder for mr. powell or chairman powell not to continue on because of the political comments made by the president? >> no. i think the federal reserve is going to be independent in all of this. >> but what i'm suggesting is that to prove independence, that -- >> no, i think that they're going to go out based on the data and what they think is appropriate given the state of the economy. >> i tend to agree with brian. if they do pause in december and they do it for good reason, there will be immediately second guessing about why they did it there will be some that say it's political pressure and the last thing you want to see a central bank come under pressure on, is the political process. >> thank you

coming up when we return, the ceo of eli lilly david ricks is going to join us to discuss drug pricing and the state of big pharma then chairman and ceo thomas peterffy is going to be our guest. we'll talk about what the midterms could mean for the market stay tuned you're watching "squawk" right he ocn ren bc

eli lilly out with third quarter earnings the drug maker earned $1.39 for the quarter. revenue also beat forecasts. eli lilly raised the outlook joining us now is david ricks. lilly chairman and ceo it's good to see you >> good morning, joe >> the stock's unlike some of your peers is near an all-time high i think it has to do with hearing the elections and the economy. with drug companies, it's new drugs, new drugs, new drugs. lilly has bragging right there is in the past three or four years. >> that's right. the last three or four years we've launched ten new medicines in the u.s. and around the world. that's driving our growth this quarter. a enin the past quarters as

well, revenue up 7%. good cost control in the income statements eps growth of 32%. and we're excited about the next wave of growth as well we're investing in r&d we unveiled a mid-stage study for a drug called trizipitide. >> who came up with that can't you hire someone not all the words in the english language are taken -- >> that's the generic name we'll give it a brand that is easier to talk about on tv it works with your body to use glucose and insulin better dramatic weight loss in that mid-stage study. that is fueling excitement about lilly as well. >> you had volume growth on the side so you can point to you're not -- you're trying to do what

politically is the right thing to do in terms of pricing. you have some bragging rights there. that that's not how you're getting the increase in revenues from raising prices? >> it's certainly not. in fact, pricing was a bit of a drag this quarter. a piece of that is u.s. list price. probably a small piece, but as you know from -- we've talked before the biggest driver for us is often the use of medicines in lower priced channels. that was the biggest driver for us in the u.s. one of our products was adopted into these medicare part d program for seniors. those prices are lower because the government gets a better deal and we also a saw more free goods to patients to start on products like staltz of course if we had raised prices, that could have offset some of that but overall it's a volume growth story. 17% volume growth in the u.s that's a strong performance for us >> so the new initiatives that

the administration has put forward, you're not a huge fan we've had the gentleman that, you know, are behind that push we had both of them on we had scott gottlieb who made a case for it, i was surprised because he was a big free market guy. and azar also more or less says this is not that outlandish to think there could be some negotiating power to use the heft of how many patients we have maybe you should be subject to more competition i thought importing price controls from abroad doesn't make sense, but they explained it in a different way. why don't you like it? >> well, we don't like it. just to step back, there are some things we like and some things that we can work with the administration to shape to support free market principles as you say and pro-innovation. and at the same time reduce prices for patients.

then there's some ideas we didn't like. and amongst those that we don't like, importing price controls from europe is high on that list >> is that really what it is though >> that is what it is. >> an average list price >> that is what they announced which is to reference a dozen or so european markets. by the way, including markets like greece and slovakia which have much lower gdp per capita we think that's a race to the bottom here in the u.s. for innovation and could really stifle what are some of the most exciting breakthroughs we see today like cell therapy. all of those products will be directed into the part b program. so we don't like that idea at all. we'd rather see them focus on creating a robust biosimilar market a number of those top sellers they reference wanting to save money on are already subjected to biosimilar competition abroad i'd like to see them step up

biosimilar policies in the u.s >> scott gottlieb was here with us talking about these plans he's a republican. he's been with the fda a long time he's also a doctor he tends to be a pretty straight shooter. he says he's in favor of these rules which surprised me at first until he explained why he also said that the drug companies were all in favor of these rules when it locked in higher prices. it was when it locked in lower prices that drug companies turned against it. is there a way -- it sounds, also, that this is a move to negotiate from the administration what would be a negotiation that you would find appropriate maybe some moves you could give the administration that would be less than this >> right, well, in late october when they rolled this out there were three ideas two of them we can work with the administration on. they've been around before and we have ideas on how to shape them to, again, embrace innovation lower cost for patients but a o also -- i didn't hear what dr.

gottlieb said on your show, but certainly the idea of foreign reference pricing is a bad one we would be supportive of piloting this competitive acquisition program, looking at models like we have in medicare part d that's the pharmacy delivered medicines and using similar mechanisms for physician administered drugs that's something i think the industry certainly lilly would be constructive on as an example. but foreign reference pricing, we don't like. >> all right the most positive drug you have in phase three trials right now or in advanced trials, what are you most excited about we've been working on some of these chronic diseases for so long a lot of times we get frustrated that, you know, the innovation just doesn't seem to come quickly enough where are you making real headway? >> i think three new medicines this year which we've advanced into the last stage of testing, one i mentioned.

the trizipitide. you lose a dramatic amount of weight, a level we haven't seen before and control your glucose. this could break the cycle of progression in diabetes. we're looking at studies to demonstrate that if this works out, this could be an important drug to help with this epidemic. we have another medicine that blocks a protein we're studying this in crohn's and colitis. that's an autoimmune disorder in the gi tract that really people don't have good solutions for. they need a breakthrough that can really force this disease into remission and this drug is something we're studying for that. and finally we acquired armobiosciences which has a product that uses the body's own immune system to fight cancer in a new way. we're excited to see data next year on that program as well

>> david ricks, chairman and ceo of eli lilly, thank you. appreciate you coming on after your report. when we come back, we have more on today's midterm elections and what it means for your investments and later, a classic post-election play defense stocks we'll find out how you should position your portfolio straight ahead. "squawk box" will be right back. broke my personal record. aflac!? no-good break. gooood break. i'm so sorry we can't make your barbecue. i'm just sick about it. aflac!? different kind of sick. if i can't work after surgery, how am i gonna pay my rent? all these bills? aflac! oh, aflac! and they pay you cash in just one day. see how aflac helps cover everyday expenses at aflac.com. you're still here?

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it is perhaps the story of the morning outside of the midterms under armour under fire for some details about corporate culture. "the wall street journal" reporting company has stopped letting employees use company credit cards for visits to strip clubs. you heard me right under armour ceo used to take clients to strip clubs and the company footed the bill. the practice was no longer allowed in this statement. clearly the practice was allowed before that. the journal said that several female employees are accusing top male executives of inviting women to a company event based

on their attractiveness. kevin plavrnk saying inapproprit behavior will not be tolerated he sent out a letter yesterday he called the journal story, quote, tough to read quote, we can and will do better we deserve to work in a respectful and empowering environment. inappropriate behavior that challenges our values or violates our policies is unacceptable and will not be tolerated. take a quick look at shares of under armour they're up marginally this morning. but this is an issue that not necessarily the strip club issue, but the issue of culture inside these firms we were talking about nike earlier. went through its own gauntlet of sorts earlier this year. >> we've watched the tide change pretty rapidly over the last several years. >> we have, we have. when we come back, more on your money in the midterms you are looking at a live shot of forest grove, pennsylvania, where the polls are open

eamon javers joins us after the break. as we head to break, take a look at the u.s. equity futures right now down across the board. but again, not by much dow futures down by 38 s&p down just under five points pple aseoawait what happens in these midterm elections. we'll be right back. at&t provides edge-to-edge intelligence, covering virtually every part of your finance business. and so if someone tries to breach your firewall in london

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good morning welcome back to "squawk box" here on cnbc among the stories front and center tapestry ceo is seeking another opportunity. he will stay until february to ensure a good switch ge is selling their lighting unit known as current. and america automaker toyota

is boosting its full year of profit the increase is attributed to a weak eer yen which toyota thinks will boost the bottom line it's election day and folks, let's take a look. you are taking a look at a live shot of cleveland, ohio, where the polls are open eamon javers joins us right now with more on how the midterms are going. what can you tell us at this point? >> good morning. big day. house and senate hang in the balance today as we look at that voting place in cleveland. a lot of the people are going to be standing in some seriously long lines today we are expecting monster turnout, enormous interest in this 2018 midterm campaign and the old expression is it's the economy stupid take a look at this stat from the most recent nbc poll this is as of november 2018 how people feel about their finances personally and these are good numbers if you're the president's party very satisfied with your finances, 28%. nobody really says that they're

very satisfied but that somewhat satisfied number is a very good number as well 46% of respondents saying they are somewhat satisfied with their finances dissatisfied, 15%. 2% there at the bottom of the list not sure. but that is a good number if you're the president's party of course these midterm elections are so difficult traditionally for the president's party. so you've got to think that the economy is a good tail wind here for republicans going into today. but there are a lot of expectations out there, becky, as you guys have been talking about one possible scenario is the democrats do stand a chance of taking over the house of representatives today. we'll wait and see how that plays out. i think the thing to start the day with is just a big dose of humility here. i think a lot of the pundits and prognosticators today need to

step back and have a sense of uncertainty, i guess, is the way to put it about what's going to happen today we really don't know it's up to the voters in places like cleveland as you're seeing there and place ace cross the country. schools, churches, public places everywhere where people are going to be deciding the fate of the house and senate and a lot of governors races today. >> it's turnout, right if there was a way that in the future when we could read everybody's minds, if we could just poll every single person on how they felt about something, that might be a totally different outcome than who actually takes the time to go and vote >> we can. it's called google >> that's a scary scenario >> it's all about who gets their people out and midterms in the past haven't been the time. this will be -- >> when you have this massive turnout we're expecting today, it can be a challenge for the pollsters. you're not talking about likely voters anymore you're talking about people who

potentially have never voted before who are caught up in the excitement today and it's hard to tell who those people are going to vote for because they're not polled over the years. >> we've talked about this in the last couple of weeks, but i don't know if i believe any poll if you're doing it by landline which was the most effective way of knowing you're getting good results, i don't pick up a landline a lot of people don't even have them >> we don't have one in my house. >> right a lot of people don't have them anymore. then you get to exit polls when you have so many people who have been voting in advance, it's hard to know. >> it's been tricky for the president. we saw this moment last week when president trump was out campaigning, been going across the country, from the stage he said how many of you have already voted in early voting? and almost everyone in the stadium raised their hands and the president said what the hell am i doing here because so many people have already voted, it's hard for him to find a crowd of undecided or not yet voted people to talk to because so many people are so

fired up by this campaign. they're ready to go out there and do it early. >> all right, eamon. thanks >> you bet >> see who's here, eamon we haven't taken a shot of him yet. but he needs no introduction >> hey how you doing? >> eamon, how are you? >> joining us now sky bridge capital founder anthony scaramucci he's the author of "trump: the blue collar president. what immediately comes to mind for me, anthony, and we've been around we've known each other a long time the never trumpers you know who they are. they ran their perfect candidate mitt romney. had had it all had it all perfect. businessman. good looking great speaker. didn't win ohio or florida much less pennsylvania or -- you needed to elect a republican with demographics or you needed a blue collar republican

>> there was a rising economy and a sitting incumbent. it's hard to unseat an incumbent in a rising economy. >> there are plenty of reasons 1.9% isn't rising. 3% >> here's the message of my book though he hijacked the republican party from the establishment the president did not have a party. he's less ideologically minded than these guys. then reached over to the democratic party and he moved their blue collar working class over so calling him the blue collar president has nothing to do with his background but it has to do with the gravitational pull that blue collar families around the country particularly in michigan, places like ohio, places like wisconsin where secretary clinton didn't go to one event in wisconsin after the convention and obviously he won pennsylvania's 32-year drought for the republicans.

he is a human wrecking ball when it comes to knocking out -- >> does the trump charm or whatever it is that he has for these people obviously it's not charming to aemp everyon-- everyone. >> i promised this guy i wouldn't mention his name, but i have an agnostic hedge fund macromanagerer one of my best friends who called me a day before the november election in 2016 and said he's going to win he's going to lose the popular vote, but he will win the presidency because of what's going on in these different states and he won the presidency. this very same person is saying that there are 40 seats right now that are inside the margin of error and wouldn't be but for the president being an nfl impact player >> meaning they could lose -- >> meaning they're in play

they could break either way. >> and if they do, would the republicans keep the house >> yeah. there's an anti-bradley effect going on with president trump. the question is and joe is right he's not on the ballot his name is not on the ballot. so will it transfer over >> we've had a number of guests come on and say if the democrats win the house, it's fine for the markets. it's fine for the economy. we've had a number of people come on and say it's terrible for the economy. what's your honest answer in the apolitical version of it if you can give one >> i want to be observational and not political. for me, i wouldn't like the fact that the democrats win not because i'm a republican but because i think they'll start doing things to the president that will be sclerosis for everybody. we need to get an infrastructure deal done. so hopefully if the democrats win, the president will cross the aisle and cut a deal with them and then be able to frame his narrative for 2020 if he's not capable of doing that and they start this

nonsense with the impeachment, i'm not one of these that believe the poll numbers will go up and it's fantastic. it isn't it's very distracting. it's bad for the nation to go through this sort of polemics, if you will. i'm not a big fan of them winning the house because it'll be distracting >> i have a question do you think politics have been forever changed by president trump in that future candidates, future presidents, future politicians are going to have to be much louder, much more dare i say uncouth. sort of this approach that has been -- and there are a lot of people, you know, joe said who don't find it charming but do you think that changed the dynamic forever? or do you think this was a moment in time >> i think it's a moment in personality more than anything else i do not think it's changed forever. but i also think that we're never going back to what we had where you have these political

consultants homogenizing and measuring everybody's words saying you can't say this and can't say that i think the american people are t tired of all of that spin. i think they want more authenticity and spin from their candidates but i don't think you're ever going to get a beast like donald trump. the guy is just steam rolling people also, if you're going to play on his playing field, he's going to demolish you he'll get you taking dna tests on yourself. and whoever runs against him is going to have an internationally recognized nickname for theres of their lives that's just who he is. >> anthony, let me ask you from the position of running money on this, what do you do at this point? if you're taking a step back and calmly, coolly, collected look at all of this, what are you doing? >> the rates are going up. they're probably not going to go up as fast as we thought six months ago because of the sensitive rates of the economy

are coming down a touch. they are going to emphasize data dependency but i think once they go towards that rhetoric, they will rally i think the bull market is very much intact. but i am worried about it. about 45% of our portfolio is in adjustable security. as rates are going up, we're clicking off incremental cash flow >> philosophically, does it bother you the president's been as vocal as he has about the fed and what they may or may not do with the optics around that? >> again, it's personality driven by him. if it was somebody else, i would say yes. but this is a guy that's tweeting about pitching changes in game four of the world series this is a guy that's going to share his opinion. this is a guy that i'm on bill maher and the next day the white house operator is calling and the media coach and chief is critiquing my performance on bill maher that's who he is i think he's leaving the fed

alone as it relates to its independence, but he sees himself as a pundit as much as he sees himself as anything else in the game. so he's going to say what he wants to say whether people like it or not. i don't think it's going to have a long-term effect on how the fed is managed, by the way >> so how many people are gone you know everyone there. what happens after starting next week >> listen, it's a hard job so you can't expect people not to burn and grind out. that'll be up to the president and attorney general sessions. the president seemed to indicate on the "60 minutes" situation that maybe general mattis is leaving. i think he's a very gifted, very accomplished guy i have a lot of respect for the general. i hope he stays, frankly i think he's done a great job. >> where -- if the economy stays basically, let's say it grows at -- i don't know you watch everyone with the sugar high and the front end loaded and all that. let's say it stays at 2.5% --

>> it should do that, joe. >> i agree but no one wants it to that's in opposition does he get re-elected in 2020 and how hard or difficult -- >> this guy gets resoundingly re-elected this guy is a human swiss army knife. he's now pulling out the next utility piece from the swiss army knife to figure out what the narrative is going to be he indicated last night that he's got to tone it down a little bit you saw that interview >> what'd you think of that? >> i think it's honest i'll say it here on your air there's a 5% to 7% head wind as a result of the bellicosity of that rhetoric. i believe if he tones it down a little bit -- let me just point it out to you. three weeks of the kavanaugh justice in the media, the poll went to 47% on the president so the media off the president,

his poll numbers rise because of that data you guys are showing people are happy the economy's boom ing. when he asks people at rallies if he should tone it down, they say no do you think he has thoughts about that >> i think those are entertainment speeches those are speeches to rile up that base. of course there's a group of red meat eating people that don't want him to dial it down but he's got to go after the independents to win the american presidency again so he'll find his home >> the crowds in 2016 were not just base. that's not enough people to get him elected. and we now know that the excitement really was different in 2016. does it matter now for local races that he still gets those crowds at his rallies? is that a reflection of republican excitement? >> i don't know. you've got to invite me back tomorrow and then we'll analyze the thing. let me say this to you though. i think that was the best strategy like, if you look at options analysis of what the president's doing or a game theory analysis,

the strategy of narrow casting to his base to get the voter turnout up, there was no downside for him if he doesn't win the house, he goes out there and says, well, obama didn't win it. reagan didn't win it bush didn't win it it's tough to win it but that was his best strategy >> what do you think it means to be a republican today? >> it means different things to different people you know, to the establishment republicans, they're crying in their soup >> although they got everything they wanted. >> but they don't like the guy because he's not one of them >> but their point is what in 2020 the classic conservative republican who looks at this and thinks it's a circus does what still votes for it >> well, i think they're reticent but i think they still vote for it and they snicker behind his back in these washington salons and they write these nefarious anonymous e-mails. these very cowardly anonymous

things in "the new york times. they'll do nonsense like that. but at the end of the day, he descended on washington with a mission. half the united states as i write in my book feels like they've been left out of the globalized system. they've been left out of the globalized economy and, you know, as you know, joe, i grew up in an aspirational middle class family. my father is a blue collar laborer. my parents never went to college. b but today they have moved into economic desperation i went on 26 campaign stops with the president. i saw that throughout the country. i spent too much time at davos and goldman sachs and working with hedge fund people, i didn't see it myself. i was in my own tunnel of confirmed biases so what i write in the book, wake up. if you're a democrat you should buy the book and wake up and understand how he stole your base stop calling the people deplorable and racist and go after them and try to reclaim them for 2020. >> do you have a transcript of

the peter thiel dealbook >> yeah. >> did you see the peter thiel interview that andrew did? >> i didn't see it >> you've got to get it to him because just in terms of calming things down about the lies, about this, about that about all the sort of -- >> he was on the talking point i mean -- >> i know he was, but he's right. he's right about a lot of it it's just a calm reasoned way of looking at what's happening without the hysteria i mean, there are people -- i'm reading it every day this election is about the potential for democracy to end if it doesn't go the right way >> i think that's a mistake. >> they don't know what they're looking at in the country. they're looking at the tone of -- so go back and look at grant or lbj you think hillary's tone you think her character is higher than trump's? look at the results. >> they're looking at the caravan. that's what they're looking at

>> go read one of those new boox and realize there's a divide out there. get out of that intellectual elitist concentric bias. it's not you but you'll understand why he's going to win again >> give us a couple epithets before you leave >> like a bad sound bite the good news is i can't get fired again, right i own my own company i'm like mayhem from the all state commercial >> with the highest queue rating >> that's why you invited me back it wasn't my hair. >> the hair didn't stop you. >> hair's not bad though, right? >> unbelievable. it's real human hair thanks to anthony scaramucci, author of "trump: the blue collar president." great to have you on >> great to be back. coming up, this morning's top stories and a check on the markets. later, the united states unleashing sanctions on iran

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the president has directed even the defense department to cut back some spending what happens if the republicans or the democrats can't control of the house >> the budget is to be back at $17 billion. but it's still well above the levels of 2016 it's a cutback but still modest. >> if the democrats take the house and you have democrats heading up the ways and means committee, all sorts of budget committees, what happens to defense spending >> the most comparable example is the 2006 midterms where we looked at it and you had a republican president in the administration you had republicans lose seats lose control of the house. democrats won the following year in 2007. the s&p was up 3% to 4%. in 2010 and 2014 midterms, you had a democrat president and the republicans had control of the

house. and performed in both. >> what happens if republicans manage to keep control of the house? >> i think that will be perceived positively because folks think they're good for defense spending but if you look at the data the last four or three midterms, it points to a positive direction for defense regardless >> you've got a buy on most of the names you follow in this sector how much of that is related to this and where valuations are right now? >> we've seen a pullback in valuation, 25% on multiples when you look at the defense. the name i like the most is boeing it's because it has an amazon-esque feature to it 700 billion is a lot of billions, but it's not capped at that $700 billion market it has a commercial space element and service element. >> sheila, i want to thank you for joining us today appreciate your time >> thank you when we come back, thomas peterffy is a big trump supporter. we will get his take on the

midterm eltis.econ you are watching "squawk box" right here on cnbc only half the story? at t. rowe price our experts go beyond the numbers to examine investment opportunities firsthand. like e-commerce spurring cardboard demand.

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it all leads up to this. it's time for america to vote in the midterms what that means for your money and more new this morning, under

armour responding to a bombshell report that it let employees expense vits to strip clubs. athe final hour of "squawk box" begins right now. live from the most powerful city in the world, new york, this is "squawk box. >> good morning and welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square. i'm joe kernen along with becky quick and andrew ross sorkin the futures have been in the red for most of the session, but barely down three now on the s&p. the dow jones called down about 16 and the nasdaq about 10 treasury yields. we got the worst of it about a month and a half ago, i guess, and we're still in the new reality. 3.19% on the 10-year today

we're watching three big stories this morning one, your money, your vote after a brutal and bruising campaign, americans heading to the polls today. for local, state, and federal elections, we will tell you what each win could mean for the party and what those could mean for your portfolio two, seeing double amazon reportedly planning to split the locations of its second headquarters between two cities and three, under armour under fire new reporting that the company executives used to take colleagues and athletes to strip clubs and the company often footed the bill. in other corporate stories, eli lilly beating both the top and bottom lines the ceo david ricks joined us in the last hour. >> in the last three or four years, we've launched ten new medicines in the u.s. and around the world. that's really driving our growth for this quarter and in the past

quarters as well revenue up 7%. good cost control in the income statements eps growth of 32%. and we're excited about the next wave of growth as well >> take a look at lilly shares this morning right now they're unchanged. beating on the bottom and top line and raising guidance for the year cvs health reporting adjusted earnings 2 cents better than expected. revenue also better than expected shares up now by 3.4%. mallinckrodt saw strength in sales of hospital products and their shares are up by more than 11% polls tell us democrats are expected to capture the house tonight. what does that mean for the markets? steve liesman joins us now with some ideas and maybe a bit of an asterisk to this that's what the polls say, but

we'll see. >> exactly i want to give you one more poll which is the cnbc fed survey midterm election edition whoa what we did is we asked a couple election questions on our fed survey that will give you the results on what the expectations are for the fed tomorrow but right now i'm going to tell you what our panel of 30 economists, fund managers and strategists say. 79% say the dems taking the house and the gop the senate pretty much what you've seen but i have prettier graphics than other people have if you look at the split there. the all red congress there, that would be 14% say the gop is expected to keep both houses 79% say the dems the house, gop the senate and 7% say the democrats take both houses. and looking at what issues may be out there, 79% possibility there. infrastructure almost, you know, about half of our folks mentioned infrastructure gridlock, none and the possibility that maybe

the democrats and the president could get together on reforming immigration. all right. which outcome is better for the stock market a majority saying gop keeping both houses. and nobody says it's best for the stock market if the dems take both houses and which is best for the -- >> you get zeros >> we get zeros. >> huh >> joe, this group is always sort of skewed a little bit toward the republican side they're economists and wall street folks 31% say the split is best. and 10% say the democrats taking both houses. i want to talk about some other polls that you guys have alluded to economic versus political polls. take a look here we've got the low trump approval rating but also this high consumer confidence the all america poll is at an

all-time high. so are some of the michigan polls. and then there's the history of the midterms which is the republicans taking the -- sorry, the opposite opposition party taking the congress the unemployment rate is also a poll, you know it's a survey of 60,000 households and they're reporting a 3.7% unemployment rate and the payroll number is a poll of 149,000 or so establishments. they're reporting 250,000 jobs every -- or in the last month. i think those polls come up against the political polls. we'll see how that all shakes out. what this -- what our poll, our fed survey is telling you is the market is poised for the democrats to take the house. the money to be made is on the other side of that i'm not sure how it might be an interest rate play it could be a stock market play. we thought we knew how the market would react in a trump election and that -- >> we don't. >> is that panned out for one

hour on the evening of election. >> who's we? >> the collective wisdom >> the collective wisdom all the -- >> i got called a jack ass by someone when i called them on their collective wisdom. >> who >> what i'm pointing out, joe, is that there was a collective wisdom as to how the market would react. >> i know. i remember it well that's why anything better than minus 10% would be a huge win. and up 30% is just -- >> i think that's right. the problem is, look 2016 we were solving for a binary question. trump or clinton now we're solving for i don't know do you know what the exponential number of questions to solve for. >> all politics are local. i have noidea how to gauge a house race people have all these different concerns all i'll say is that you could -- i can name 20 races i'm totally interested in.

that are so compelling whether it's governor, whether it's senator. whether it's, you know, heidi heitkamp whether it's, you know, there's just a lot governor races, i'm from ohio but then there's florida and georgia. there's just a lot of things. >> there's different ways to get to the solution, right >> each one of them would be interesting. >> if you had 20 races decided by a percentage point in one way, that would equate to a sweep. if you had them go the other way, that would be an historic keeping of the house by the republican party you mentioned some interesting things earlier which is the early voting >> how did that skew any of this people say it would change things in the coming weeks up to the election but not if you voted already. >> they wanted to vote at that moment on that information that's one of the things wrong

with the polling before 2016 and with the exit polling after. we don't really know how and why the people voted or the percentages in which they voted. and as a person who's conducted a poll for the last ten years, you can never solve for turnout or enthusiasm. >> i don't know anyone that hasn't been sort of taken over by it. whether it's not just the election now but just politics over the past couple years it's split up families people are eating pancakes and gaining weight from the politics >> there's a show on npr covering the elections today but only the post-election stress syndrome and what your reaction is whatever the results may be. >> it's split families it has some people are -- someone said that they asked this lady, you know, what should we bring for thanksgiving this weekend. she said i'm not really sure it depends on the turnout. i mean, everybody's talking about -- >> i would argue all this goes back to -- i talked about it two months ago i it all goes back to the

financial crisis in terms of looking at the anger in this country and how polarizing it got. it wasn't necessarily trump. i think trump was a function of it >> can we bring it back real quick to the markets >> please. >> which i'm wondering how you game this out. one of the things i think we're discussing, and i don't know if this is true but knowing the outcomes of elections is more difficult now, perhaps. and i think donald trump introduced this idea that is both on the one hand more polarizing but more engaging so you bring more people back into the process which creates another given uncertainty. this idea that gridlock is good. it may be true if you like the status quo and the markets don't like change. but in a world where there may be real things to legislate. then gridlock matters in a negative way >> well, except for that i don't

feel like either party really has a plan for tackling any of those issues so even if either party were to sweep and hold all three branches of government, i don't know that you're going to see. i mean donald trump himself said he's not interested in entitlement reform >> here's a good place to leave it we had two or three ridiculous optimists in our survey say that the result of the election and the democrats taking the house would be more negotiation and compromise and i think that's both ridiculous and optimistic. no party by itself can do anything and the idea that there are real issues to legislate -- >> nobody wants to own that. you're either going to find a bipartisan solution or no solution >> i think you're right. let's find out what the markets are expecting today and tomorrow from what we find out from the midterms. joining us now, jim iuorio of tgm. he's also a cnbc contributor

jim, obviously i'm not always in the mainstream around here, but i think that when the gridlock would mean maintaining two years of some really positive stuff like deregulation or tax reform, i don't care whether we do that much more at this point. if we aren't done that and we had gridlock, i think it'd be much different but if we can just hold on and, you know, keep what we have so far, i think it's going to end up being better. >> and that's a fine take. i think that's -- let's start with from the worst case scenario if the democrats take both houses for me to say the markets like this experiment with supply side economics we've tried over the last two years that is defensible i don't think that's going to get anybody on my case here. so if that happens -- it always does particularly on twitter. i get hate mail all the time so if that happens, i would

immediately look for is is there going to be rate expectation adjustments. stock markets did just fine when we were trying demand side economics as hard as we could for eight years. most of that was a function over the entire curve it's provable that the markets want supply side economics the fact that on the day of the election two years ago, it was trading at 2.78% that's amazing to me and that's a vote for supply side and i believe this walk down the supply side path is very, very small. and if it surprises and both houses are taken by the current administration, i think the market would like that quite a bit. i don't think conservatives poll well we've seen that a couple times before a lot of the people i talk to keep their politics quiet in this somewhat volatile time. >> yeah. you live in new york city. >> i live in chicago >> i'm sorry >> same thing. >> yeah. that's what i mean

and you want to be able to eat in a restaurant without, you know, getting thrown out or something dumped on your head. >> amen. >> i understand. >> keep in mind, when i spout these things for you twitter people too, this is presented without judgment i'm trying to make a buck here on what the markets are going to do i'm not talking to you about any of the other issues you come after me for this is what i think the market wants. i'm actually relatively sure the market wants more supply side. >> jimmy, if you were going to say i got a feeling that the republicans are going to hold onto congress, where would you position your portfolio? what's the play on that? >> i think it's probably banks think about it if it goes the other way, the one thing we know for certain is that people like elizabeth warren want to regulate the hell out of banks and that's fine i'm not even saying that might not be the way we should do it again, i keep couching this. but i think that's probably pretty good. i think the overall market would do better in that situation. the only wild card again is that might embolden the fed to talk about rates. >> yeah. would you shorten the interest

rate complex >> probably i would. particularly i'd want to short the long end >> all right i mean, none of us know when we're even going to know i guess we'll have a pretty good idea by tomorrow >> there's some problem with one of the states not counting the early votes until thursday >> what? >> and then dribbling them out over -- i can't remember which state i heard. >> they've had them for weeks. >> right >> there's a couple of key places where you should be able to -- i don't know whether that's true either i figure you can have some surprises one way in some places, surprises the other way in other places. >> all politics is local yeah >> what state is that you think? >> i heard it last night on the radio. >> if it's really skewed either blue or red, maybe you would know early i mean, if crazy stuff is going on >> well, we'll be on at 5:00 a.m. tomorrow. i think it's possible we will not know a number of states. >> i want to say arizona that they have some issue they're going to be counting

votes for a long time. >> that's why i never wanted to vote early or send in an absentee ballot. does your vote count >> your vote counts, becky >> it counts more if you show up on election day. >> that's right. >> you know, on the new york exchanges, i don't think that ugly jacket would fly. i keep forgetting you're in chicago. >> this is good jacket remember down here we try to have wild colors >> lapel should be the same color as the rest of the jacket. >> yeah. some day some day i'll move towards you >> who used to wear the cow jacket >> scott schelati. >> then you can be identified by your jacket. >> exactly >> jim, thank you. coming up when we return, the u.s. hitting iran with sanctions but not everyone is barred from buying the country's oil. we'll talk about that. energy expert dan yergin joins

us after the break stay tuned here on cnbc. and seamless experience across web and tablet? do you want $4.95 commissions for stocks, $0.50 options contracts? $1.50 futures contracts? what about a dedicated service team of trading specialists? did you say yes? good, then it's time for power e*trade. the platform, price and service that gives you the edge you need. looks like we have a couple seconds left. let's do some card twirling twirling cards e*trade. the original place to invest online.

welcome back to "squawk box" this morning want to take a quick check on the reaction and the energy markets.

joining us is dan yergin good morning to you, dan >> good morning. >> i want to talk about the midterms, what you think that means in terms of lots of things but in particular the situation in iran. the sanctionsand how that's going to affect the energy market before we start, what's your take on to the extent that energy you think is connected to politics right now >> well, i think that the president made it clear yesterday when he said he didn't want to cause a big shock to the oil market and send gasoline prices up and that's part of the reason that we're now seeing this kind of compromise with the main importers of iranian oil to give them exemptions that allow them to continue to import some of their oil you can see that in the oil price which is down from around $86 a month ago to the low $70s >> this is an exemption for eight importers. china, india, south korea,

japan, italy, greece, taiwan, turkey what do you think could happen in the next 180 days >> i think the pressure will continue on them to reduce their supply when i was in india about two weeks ago, they said bluntly we're not going to zero. i think the administration is going to push them to do that or to try and get them lower. right now it still looks like iran will be exporting about 1.2 million barrels a day. it was doing 2.6 million and they put a lot of oil into storage on tankers but i think this is going to be more of a slow motion rather than a cold turkey a couple weeks ago which was really agitating the market, they were saying we want zero exports from iran. that was not feasible. >> and will that be feasible after 180 days so 180 days out from today where would you predict wti to be? >> i think we'll see some

further reductions on imports from those countries i think it's hard to see getting down to zero this is part of a larger program in terms of banks and all the other sanctions really trying to put this pressure on iran. what's different about it this time was a unified country working on the nuclear program now it's really the power of the dollar and the u.s. government pushing this i think a big question, andrew, is what is the objective here? it changes in terms of what iran does that is on its missile program or is it regime change and i think that kind of ambiguity is going to kind of be the foundation going forward >> if you had to handicap it, what's your answer to that going forward? >> well, i think regime changes are going to happen. i think we're looking next year expecting iran to lose about 2.5% in terms of gdp i think the pressure will be there. the difficulty is, andrew, with north korea, there was one guy to talk to in iran, there are a lot of guys

to talk to it's a much more sided situation. it's got a rancorous political system so the question is who do you sit down and make a deal with. that's something we'll have to see in the next 180 days and beyond that. you'll see the bottle necks in the permian which is restricting the growth of production, you see the infrastructure constraints being lifted and more u.s. oil coming into the market that probably is something that would strengthen the administration's hand. >> okay. so if you are an airline today or fedex today or an investor today an you're thinking about where the price of oil is headed, 180 days from now it will be where? >> well, i think, you know, you have to tell me what happens to the chinese economy. but i think sort of figuring in the low 70s into the low 80s is a reasonable range but you're watching closely china and the global economy

because those will be determinants in these factors. >> any chance we go lower from where we are now >> if you get a slowing economy, yes. you'll get pressure particularly -- you know, we think next year from september in particular, we'll see a big surge of oil coming out of the permian basin. at this point demand is holding up as strong but if the kind of predictions from 2020 weakening economy, then that would put renewed pressure on oil. >> okay. dan yergin, we appreciate your time thanks all right. coming up, the guy who's been called florida's richest man we'll be joined by the ceo of interactive brokers thomas peterffy we'll talk about what happens if republicans hold the line or democrats win the house. or whahet thinks. stay tuned you're watching "squawk box" on

cnbc

a o o o o o a o ae . welcome back to "squawk box" this morning take a look at futures on this midterm voting day go out and vote if you haven't already this morning dow jones looks like it would open off about 34 points down. s&p 500 off about 4.5 points and the nasdaq off about 15 points when we come back, shares of apple suppliers under pressure after reports sheds doubt on

iphone manufacturing we'll tell you what's up when "squawk box" comes right back. 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.

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good morning, everyone welcome back to "squawk box" here on cnbc we are live from the nasdaq market site in times square. among the stories front and center this morning, earnings out from ralph lauren. $2.26 a share reported however, same store sales were flat that stock right now down by 3.4% the labor department will be out with its september jolts report at 10:00 eastern time. similar results are expect eed this time around and under armour will no longer allow employees expense trips to strip clubs. this came from a "wall street journal" article which characterized it as a long standing company practice. the employees received an e-mail

this year prohibiting it ceo kevin plank called the story tough to read and said the company can and will do better one thing we should point out, though, is it's not sure how widespread this practice actually was the company did send out a letter earlier this year saying it was not allowed when it came to their attention there had been some reports of this. the company also says, though, that the company does not condone use of adult entertainment for business mr. plank has never conducted business nor used company funds at such venues he doesn't even have a company card so maybe that clears that up on his behavior >> i mean, world's changed it's not living in "mad men" world anymore. >> no. >> we haven't been living in -- >> i know. i know >> this is 30 years old. >> i've had a morality clause in my contract for 25 years so it's not something that's been on the radar screen >> i would say even wall street,

look i haven't heard stories about this on wall street in a decade. >> doesn't mean it's not happening. i still would like to know at these places what percentages his it is. i bet there's an amount that is -- >> i think the entertainment might be different -- >> it's not under armour publicly held profile company. there i think you -- >> oh, you mean -- >> it's a business expense at the place. yeah what'd you think i meant >> i imagine if it is, it's unfortunately fraudulently expensed as something else that's the distinction >> like when you rent that movie that doesn't have a title. it just comes and says movie and you say, no, it was "incredibles 2," i swear, honey. >> is that what you do >> i'm surprised you can still expense drinks >> there was one recently it was like $100,000. remember that one?

we're watchingshares of apple suppliers falling sharply in asia overnight after a report said that apple told them to cancel plans for additional production lines for its new iphone xr. apple shares fell nearly 4% yesterday following a report sparking concerns that the iphone xr is actually facing weak demand. and speaking of apple suppliers, a new wall street journal report saying this morning that foxconn considering bringing in personnel from china to help staff a facility in wisconsin. struggling to find engineers and other workers in the tight market foxconn pledged incentives to help lure local authorities added $764 million foxconn says its wisconsin first commitment remains unchanged it still plans to hire 13,000

people to work at that facility but there's still been a lot of controversy over that decision and whether, frankly, they'll be able to make the money back that has been offered stocks in watch and wait mode ahead of the election results. as investors weigh the odds of a traditional year-end rally mike santoli joins us now with more what are we thinking >> i think what's important is what the consensus is thinking it seems as if it's really become a solid majority view that all these seasonal -- magical seasonal factors we know about midterm elections are about to be freed up here. the s&p 500 is up about 5% from last monday's low. in a week you're up 5% from the low but you're in this zone where people aren't clear if last week was a bounce or something better i don't argue with any of the seasonal factors saying after every one of the midterm election years we've had the s&p up in the subsequent year. >> you're talking the first -- the next month and a half. >> well, the next month and a

half to me is a little more clear than not but if you look back to the last two midterm election years, okay in 2014 you went up 5.6% in the top. it isn't as if it unleashes a great renaissance for the market >> though i read in the averages -- and this goes back to world war ii. but i read on average the market is up 17% in the next 12 months. and if you just look from the lows, up more than 35%, i think. >> my problem is 18 years almost random -- >> 18 elections. >> the first year of the presidential election is supposed to be awful dpp that work >> true. >> so it's not so much you don't want to know about these, but don't feel they're decisive. specifically i think the midterm election effect, it's getting it out of the way and seeing if the market is primed for a rally it's not about a policy play >> we're up 5% from last week. how much are we down >> 7%. >> for the s&p. >> so it would be a 7% move from here to get back to the

september 20th high. which is not out of the ordinary i think the one thing that makes me uncomfortable, eight months ago i started talking about 2014 as a year to this one. i think everyone is now all over that >> maybe it's been too telegraphed. >> i don't think it invalidates it but you have to wonder if people are leaning that way the good news is they did get a lot of fear built up in october. it's not as if everybody is taking a lot of risk right now going into the final seven weeks of the year or whatever. >> we're going to have thomas peterffy on with us in a little bit. he says in his exchange interactive brokers, he's seen a lot of cash on the sidelines ready to come back in. what do you think of that? >> i think there has been a buildup in cash. there's a sense also that dip buying has not worked as well in this year. there's been studies on that

if a week was down during this bull market, it almost always paid to buy it and bet the next week that has not worked this year. >> if we had a reversion to the mean on election surprises, such a big surprise in 2016 that this could be -- come out and it wouldn't surprise the if it was exactly what people are thinking. >> right >> a difference if they win by five or ten seats in the house maybe the republicans add two in the senate or something like that >> i think the thing to remember is the first reflex move of the market in response to even as expected like that is not decisive >> we're going to talk to thomas peterffy he thinks the market is already down in the last couple of weeks because of the house he thinks when it becomes a fact that it goes down another 2% to 4% but if it was the senate, it'd be down another 10%.

>> see, the kind of excess precision on all of this bothers me >> it's one of the richest men >> exactly brilliant trading guy. >> probably shouldn't have opinions only based on money >> i'm glad it doesn't work that way. expect in politics, apparently >> mike, thank you good to see you. > >> in florida. you see the votes? he's the richest man in florida. thomas peterffy joins us with his prediction on what's in store with the markets with what happens tonight. today. by tomorrow, by some time. we'll be right back. if we're gonna steal christmas,

we're gonna need the element of surprise.

go team. [ snow crunching ] [ load crunching ] [ whispers ] this is the loudest snow ever. >> welcome back to "squawk box." take a look at the futures on this voting midterm day. dow looks like it would open off about 21 points. nasdaq off 10 points s&p 500 off about three points the billionaire founder and ceo of interactive brokers is worried about a possible blue wave on capitol hill thomas peterffy is here to tell us why thinks it would be negative for the markets he joins us now from palm beach, florida. thank you for being with us today. >> thank you for having me >> we've been teasing you as the richest person in florida. but you're in the top 50 people in the world because of the hard

work you've done building the exchange and beyond. we're telling people to listen up to what you have to say let's talk first of all about your overall call on the markets. i know that you went negative on the markets back in june but earlier in october, you said you were closer to going positive on the markets. have you decided that you're bullish on the markets at this point? >> well, i think it all depends on tonight i am waiting to see what happens. i think people should be aware that the futures options are trading all evening long and most electronic brokers such as interactive brokers or others enable their customers to trade

on their smartphone throughout the evening and night. as the results are starting to trickle in, people who have analyzed the various races and followed the elections closely can take a favorable opposition. >> so let's get your baseline analysis let's assume the consensus at this point that the republicans lose the house but hold the senate is what happens 37 what would that make you feel about what you -- how would that make you feel about your call for stocks at this point >> well, that is probably true, but i think the -- on the short run that we will have a negative impact on the market i expect it would drop about 2% to 3% if that's the outcome. if the senate also goes democrat, i think we could expect a 10% to 15% drop however, if both houses of congress are retained by the

republicans, then i think we'll go back to the highs >> and you would be a buyer if either the consensus estimate or the republicans hold both the house or the senate? or would you be a buyer if the market dropped 10% or 15% if the house was able -- house and the senate both went to the democrats? >> i will be a buyer after the market drops either if the house goes democrat by 3% or both houses of congress go democrat by, say, 12% to 14%. then i would be a buyer. and i would also be a buyer if, of course, if the republicans retain both. >> wait a second just to be clear, you'd buy essentially in any scenario after the midterms >> after the market does move as i expect it to >> okay. >> thomas, i wanted to ask you since you're based in florida whether you think that -- people talk about the gubernatorial

race in your state as being a referendum or a proxy potentially for 2020 do you see it that way >> so i do not but this happening here is andrew gillam is a declared socialist. if he gets elected as governor, he's going to start instituting income tax in florida which there is no income tax currently. so we're looking at socialism if that happens i think it's a tragic outcome. >> thomas, maybe you can expand your views on socialism a bit for people who don't know your background >> so, you know, i was born and raised in hungary. i lived there for the first 21 years of my life and i know that most of these people who want socialism basically don't understand what

they are talking about i don't know if they have really studied the issue. i think that people are -- have to be motivated. they have to be incentivized in order to produce more goods and services or better goods and services products like an iphone, for example, could never happen in a socialist country. i don't think these people know what the impact could be it's a disaster. >> thomas, i haven't spoken to you since i visited hungary. it was recently. what a great place but still to this day digging itself out of that -- of what happened and you can see it everywhere you go in budapest and everywhere else. digging their way out. and an absolute love of western value in america and everything

else so it opened my eyes to what you've attend before on this show >> and it's not only in hungary. it's all over eastern europe countries that used to be controlled by russia they've really suffered. >> thomas, what -- >> i wish that all this -- i wish that all these socialists would take a vacation in venezuela or cuba or north korea. >> bernie sanders did take a vacation but it didn't work for him. i don't know >> thomas, what do you make of the -- both the personal attacks, the bomb that was sent to his home? he was also born in hungary, george soros >> yes so i don't think that people should do things like that it's a terrible thing. you know, that person should be put in jail or even worse.

we should be civil to each other number one number two, we should have a debate instead of screaming and yelling at each other. >> why do you think given both of your backgrounds, how would you explain where you ended up in terms of how you think about the world and where perhaps he thinks about the world >> well, you know, george soros is an enigma he's a very bright man and i absolutely do not understand why he behaves the way he does i think he's basically an anarchist. >> you think he's an anarchist >> yes he goes against communism in the '70s and he's against free market capitalism today and i don't know what is in between. so i don't understand it >> do you think that's a fair assessment and the reason i say that is i'm

not so sure "a," that he's an anarchist. and the second piece of it is, i'm not so sure that he doesn't believe in markets at all. i think there might be -- this might be an extreme version. i mean, the suggestion you're making, of the way he thinks about it i'd also make the argument that potentially, talk about socialism or socialism in florida even i'm not so sure that's even what is really on offer so much as it's a bit about the pendulum swinging -- maybe the pendulum has swung too far in one direction. >> yeah. well, look you go to any socialist country. you can't find any country where socialism has been tried and where people are happy and it usually fails after some bloody interlude it swings back to capitalism and starting with the french

revolution, that has been all throughout history so ask yourself why is that. why isn't there a socialist country today where people are happy? >> it ends in tyranny and it's all spelled out. it all spelled out it is clear how it happened. unfortunately, usually tens of millions >> people end up dead as well. >> capitalism has gone too far >> we move to a winner take all society. there is no question of that becoming an issue. there is a real question whether capitalism being pursued today is working in your mind. >> no. not in my mind not at all >> we are never going to settle though >> remarkably uneven sense of

how capitalism has worked since 1980 >> it is not capitalism. >> guys, you have the great debate, thank you for including me >> thomas, thank you, can i ask you a question, that's why you were thinking turning positive at that point. have you seen the money deploy since the market came down significantly the last several weeks? >> no, we have not demand have increased slightly and i think it would be ready to come back if both houses of congress remain in the republican hands today the market that i said would go up to recent highs >> you said that early october was about $50 billion, if it is more now, what are we talking

about? 51 and a half. you said that's the highest that we have seen and how long. >> all right, thomas >> that's only the amount of money our customers have with us >> sure, thomas, i want to thank you very much for your time today, we appreciate you being here >> thank you, thomas peterfyy. >> the future right now not a lot of movement. a little bit worse than they were before. 41 on the dow. s&p down and nasdaq is down. we'll be right back.

jim cramer is joining us now. it is not great to talk about politics it is tough to avoid it today. >> that's aciddictat dictator s. >> that's who our enemy is >> i don't know how many lives

you are talking about there, jim. >> the prc it is the communist. i like the people, it had nothing to do with the people. >> i don't know. i get frustrated and tired of talking about our different like there is any questions r reagan says you are only one generation away from not even realizing the capital. it has to be flop but it gets tiring, does it? >> it is not politics. >> so what -- >> it is just enemy. >> do you think you can tell anything from the market the market don't know what's happening either >> thank you for saying that people are going to come on. it is going to happen like this or that. >> if they knew, you are hearing someone saying i am going all in or putting all the money in the s&p.

it is like going to the casino i am going all in red or black the only thing i think republicans take the house, the defense stock goes up because they have been going down and down because of the bleep that the democrats take the house joe, we are guessing let's not forget that the communists run china that's not a democracy over there. >> all right, jim, that's a good point. thksan, we'll see you in a couple of minutes. >> okay. omes risk. and to manage this risk, the world turns to cme group. we help farmers lock in future prices, banks manage interest rate changes and airlines hedge fuel costs. all so they can manage their risks and move forward. it's simply a matter of following the signs. they all lead here. cme group - how the world advances. what do advisors look for don't just track an index, help me meet a client's need.

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go out and vote everybody, make sure you join us tomorrow we'll be talking about that. "squawk on the street" begins right now. ♪ >> good tuesday morning, welcome to "squawk on the street," i am carl quintanilla with jim cramer and david faber. jim has voted. europe is uniformly red and the 10-y