♪ good morning i am carl quintanilla with morgan brennan, jon fortt back at post 9 of the new york stock exchange amazon is up almost 4% this morning, nasdaq is higher for the year, once again trying to recover from losses the last couple of months that saw the index drop more than 10% bru in anthony declemente and phil smeed good to see you both anthony, we obviously talked to

death what happened to some faang names over a couple of months are they at attractive levels for you, and if so, which ones >> absolutely. what we've seen in october and november has been a big unwind in hedge fund positioning in these names. hedge funds had to take down long exposure, levered long exposure that's a technical factor that's impacting the stocks as a result, you've got companies that as a tech nvestor you own many year that are on sale for us, if this is going to risk on environment heading to 2019, amazon would be one we go back to jon was talking about early tea leaves on thanksgiving and black friday you know, results have been substantially above expectations that's a good sign we think fourth quarter revenue guidance for amazon should be

conservative we think alphabet is a compelling value and more defensive if you think the hedge fund unwind continues to year end. bottom line, carl, macro fears like the fed and tariffs have been driving the market and that's been driving down the faang names as a result of the market unwind, and we think those are largely bigger picture, external factors and that the company fundamentals for a name like say amazon oral fa bet are intact. >> it is interesting if you look at market caps, microsoft is bigger than amazon and google and nipping at apple's heels, 15 billion away interesting rebalancing effect within tech. what do you make of that, that names like microsoft, oracle,

cisco, older tech heavyweights that are having new life, that they can perform decently well into next quarter? >> i don't know, i'm so glad you brought up microsoft and cisco our other guests, it could be well right, but people are saying what he said about microsoft, cisco, intel, three to six months into the decline through 2002 what you have to realize is we reached a four standard deviation event two months ago where growth outperformed value by 50% over the prior seven or eight years. same 50% it outperformed from middle of '96 through the early 2000 point the problem is when the hedge fund guys bail on levered trade, that's fine and dandy. the problem is where does a

stock bottom that starts at 120 times earnings in the case of microsoft, it was a 65% peak decline from 2000 to 2003 cisco, 90% sun, micro systems and others are nowhere to be found. they're in the rubble pile somewhere, so the question isn't who is going to survive and prosper because microsoft and cisco and intel did survive and prosper, but they went 15 years in microsoft's case or 18 years plus in cisco and intel without making a new high. that's the trap people are in now with faang stocks. >> bill, if this is indeed a trap, if faang names are indeed going to drop even more from here, can the market rally more broadly without them >> we don't have the answer to that that's a great question. it would be wonderful to know

that but i will say this, that per where interest rates are now, there are spectacular opportunities in things that have been left for dead under the assumption that the only thing that matters is condo prices in new york or the only thing that matters is condo prices in san francisco. the other 85% of the united states economy is doing great without them and it wouldn't be any tragedy to have tech, palo alto and seattle go in the dumper three or four years and the rest of the country to flourish because everywhere i go, we're seeing families formed and houses are going to get bought that's the most interesting trade right now. >> anthony, among the faang names you seem to like everything decently except netflix. granted, netflix has had quite a run. still by a lot of measures

richly valued. why in particular are you skeptical of that name >> i think that for us the concern on netflix has been valuation and in an environment of rising interest rates, free cash flow deficit for me in '19 and '20 at 18 and 19 had been a concern. with higher rates pushing down terminal value of netflix. the reality is that stock is down 100 points. for the most part with exception of the second quarter this year, results have been awesome and subs have beaten, and i think netflix being the future and the market leader of media distribution, that that fundamental thesis is intact i have been waiting for the market to give this opportunity, waiting for positioning noise to clear and maybe stock trades a little lower, but basically i think that with free cash flow trends improving into 2020,

netflix, entry point provides investors with a good opportunity here >> interesting, remarkable turn even today was lagging badly, rest of the names earlier in the session thank you both >> thank you big news out of gm, announcing it will close three assembly plants by end of next year, cutting 15,000 jobs in north america alone. phil lebeau has the latest from chicago. >> not surprised that general motors wants to improve capital utilization of plants because these plants are not running at full capacity, result, the company making dramatic announcements in terms of what it is doing with final assembly plants they use the term unallocated in terms of new product going there. let's be clear they're shuttering these, they'll probably ultimately be closed three plants in north america, two propulsion plants, cutting salary staff by 15% here in

north america. in terms of job cuts at those plants, here is how it breaks down lour lourdstown, ohio, 1435 workers there. detroit, tramaine gibshamtramck down to one plant. and orbawa, ontario, 2200 jobs here's a union leader in canada talking earlier today about this move from general motors and how it sits with the gm workers. >> general motors is announcing plants closing in the united states and canada, but guess what, none are closing in mexico this is another way of general motors saying thanks for nothing, and this is what they do and they do it best. they should be ashamed >> as you can imagine, a lot of bitter employees not only there.

when you look at shares of general motors, this is the reason the stock is moving higher, guys i know it is not what people want to hear about on a day thousands of workers are being cut. they're going to be improving free cash flow by $6 billion by the end of 2020. that is a rapid payback in terms of how quickly it will filter to the bottom line. it will be taking charges between 3000000003.8 billion shares of general motors are now up almost 7% on the day. >> phil, this is a lot of jobs in purple states ohio and michigan. how does this square with the administration's economic message about all these companies trying to move jobs to the united states, revival in manufacturing, doesn't seem to square >> doesn't square with what the administration was expecting in terms of more jobs being added in the united states separate from that, jon, the

bottom line is these are plants that were building primarily cars, sedans, small cars the market is moving away from that so if you're general motors, you sit there and say what do we do. keep these plants open even though nobody is buying the chevy cruz or chevy impala or cut down plants and say what existing plants we have which are focused on pickups, suvs, crossovers, do we increase production there gets to the sound you heard from the union leader in canada, who was none too pleased about the move, general motors continues to increase production and exports from its plant in mexico, pickup trucks, here to the united states. that's what's bothering workers not only in canada but also at the hamtramck plant and lourdstown, ohio >> we're getting word that trudeau has already spoken with mary barra, talked to her

sunday. >> i wouldn'tbe surprised, carl we haven't got confirmation on this, wouldn't be surprised if she had a conversation with the president saying this is the move we're making. end of the day, her argument is i have to do what's best for shareholders and my company. if we can reinvest more in things like electric vehicles and autonomous drive vehicles while also getting rid of inefficient plants, painful as that may be, that's the move she's making here. >> yep we'll see what the president's reaction is. we know how he reacted to harley a few months ago we'll see if he has word on this one. phil, we'll be coming back to you. and we'll talk to bob lutz in less than a half hour about this very story. new data from adobe saying today will be the biggest online shopping day in u.s. history contessa brewer is live at an aem amazon fulfillment center in new jersey and has more. >> reporter: hi there, morgan.

all 14 miles of conveyer inside this million square foot facility are dedicated today to fulfilling cyber monday orders, coming in fast and furious amazon has some competition ahead of it. it is trying to best its own record set last cyber monday in 2017, when it was the biggest day ever, selling 83 million items if you do the math, comes out to 3.5 million items an hour significant. all these items go out, sent to homes from here around the country. here at this fulfillment center, one of 110 nationwide, and one of 25 robotic centers globally, they can process these very quickly and efficiently. they still need human beings, some 2500 people work here talk about numbers for cyber monday you mentioned adobe, saying it could be the biggest online shopping day in american history. we're on track for 18% year over

year growth. there's a lot of competitors that want to take a piece of the pie, walmart, target, kohl's, best buy, all would like to take a piece of this from amazon. amazon thinks they can fend off the competition and keep growing by offering steeper discounts on more items and free shipping for everyone you don't have to be a prime member that's one way they distinguish against competitors. last quarter before we hit this holiday retail shipping offer, amazon said it spent $6.6 billion on shipping but nearly doubled operating income something to consider. they think they can grow the profit margin owning a bigger part of the distribution chain, buying plaenls, trucks, delivery chains have to see if it works out for them for the moment, you're seeing workers here busy making sure items, echo dot at half off, the fire sticks, the tablets all are

put into boxes and shipped out today. morgan, carl >> all right thank you. i will take it when we return, lean out sheryl sandberg or mark zuckerberg kara swisher is next on who is to blame for the facebook fiasco. the dow is up 356 points strong bounce this morning a lot more "squawk alley" coming up nasdaq doing best of all up 1.7% with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today. fidelity. hey, what are you guys doing here? we've been helping you prepare and invest for retirement since day one. why would we leave now? because i'm retired now. so? we're voya. we stay with you to and through retirement... with solutions to help provide income throughout.

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facebook up 3%, remaining under fire after uk parliament seized internal documents related to the privacy issues earlier this year. coo sheryl sandberg getting plenty of the blame for the crisis management. our next guest asks why is everyone ready to forgive the man that runs neighbor kara joins us this morning >> hi, how are you doing >> i had some of the same issues that you mentioned in this column seems to me if mark zuckerberg had been asking questions about the way they were managing the reputational crisis, sheryl sandberg wouldn't be able to forget there might have been more attention to it. he likes to focus on making

facebook, not so much on explaining facebook. he views it as a chore. >> i don't know, if he is the ceo, he has to run the company my issue wasn't with sheryl's management which has myriad of problems and deserves a lot of blame for what happened, the two of them are together as a team, you know, but i think what the issue is the way she attacked it is different from him. people tend to give him a pass he is busy making product. he doesn't understand this oh, this and that. she's the adult in the room. i find that offensive. he is the ceo, the controlling shareholder, the founder, and he made the products that were the problem. so it seems like it is interesting to watch that. again, doesn't take blame from her or top management at facebook, it is just really interesting that he is unfireable because of these issues people tend to go easier on him and i find it odd. >> seems like the biggest miss of his goals for the year.

this one was fix facebook. all these issues from the past seem to be underscoring the fact that they haven't gotten ahead of the issues, not necessarily with product but also with reputation where facebook is concerned. >> i think so. i think there was a "new york times" story about what happened with more e-mails, what they said, didn't say believe me, this has been an issue before sandberg got there. i have been covering it since the very beginning it is the same thing to me, companies are the dna of their founders this kind of constant slow roll, not using the term coverup, i think that's not what "new york times" reported or others are saying, it is a slow roll of information after making a shoddy choice. that's my only thing who is responsible it should be the ceo just because he is wearing a hoodie doesn't mean he is not capable of being forthright. because of the way it is

structured, you can't get rid of the founders, can't chastise them the board has almost no power. that's to me an interesting thing to bring up, who gets the power, who has the power, who gets blamed for things >> kara, i want to bring up one of the paragraphs. everyone expects so little from male leaders often seen as the full krom of the digital worlds they create, and females are held to a tougher line have we seen other examples of this >> you see it all the time in many ways. it took forever to get travis kalanick out of uber it was fascinating to watch they wouldn't do something when someone was not managing the company the way it needed to be managed. now dara is doing a much better job there. it was interesting that it took a lot, a lot of miss behavior to get that to -- misbehavior to get that to happen i find that fascinating. other people do not get that, especially in the middle levels

of companies it is linked with the google walkout podcast i did earlier this week with the organizers. they have the same issues, who gets in the case of google, there were big payoffs to men with big problems, $90 million in one case, got to walk out the door this is money from these people who worked really hard i wanted to make that connection between the two of them. >> so how does this change is it more female founders or do we end up with the same issues with that founder perhaps being seen as untouchable as long as she has voting control, and some number two maybe also a woman, maybe a man, seen as expendable. >> it might. it might be the case that might happen. it has happened. obviously she did not have control of that company in the same way, but are these structures the right way to operate when you get to serious issues like this

now the only remedy is regulation it is going to be -- it is not the board doing its job, because the board can't do its job really i know there are critics on the board giving mark a tough time, but they can't do anything so to me it is interesting to look at structures which i doubt anybody in silicon valley wants to change, but they like the founders having immense control of things. when things go wrong, there's no way to fix it. that was my point. >> that sounds weird, kara the board giving the ceo a hard time i mean, the board is there for the ceo to be accountable to them, but that's not how it works here >> no, it doesn't. they can say they have power, but they don't they really don't. what can they do, they can speak to him strongly. it was interesting, they talked about the board room dynamic irskin bowls was tough on them both, but there's no result. what is the result what is the thing you can get

someone to do? it is like having an out of control toddler who runs the show like the bad seed. remember that movie? like you can't do anything not to say mark zuckerberg hasn't done amazing things with the company, but there's a point just like any board, you need to be held to account and in this case it is not going to happen on this planet >> always a sharp perspective. thanks for being with us look at shares of gm today, up better than 6%. best day since the last day of october on news of layoffs, shuttered plants, some models discontinued more on that with bob lutz in a few moments. look at major averages stocks off the worst black friday performance in years, and dow holding on to gains of better than 300 points

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european markets are closing and wilfred frost joins us >> a positive day in europe. stock is up a percent and a quarter. got a boost as wall street opened here's the two year yield. lowered the spread between germany and italy, that's good for italian stocks ftse leading relative to the rest of europe markets banks up significantly as well even deutsche bank and others across the region up sharply, up now 5% interesting move there why? because the leader of the movement talking about the budget, saying as long as it contains the gold they established, if negotiation means the deficit target comes down a bit, that's not important. made that on a radio interview,

that comment two year yield over the course of six months highlights risks are still elevated that's the pound not to worry mentioning development on brexit, theresa may did get agreement from the eu counsel over the weekend next crucial vote to uk parliament december 14 still looks difficult. if we look at the british pound, it remains still near lows of the six month range, and lost the gains it had this morning as we approached european close carl, back to you. >> what a weekend in europe. let's get to sue herera for a news update. >> good morning, carl, good morning, everyone. here's what's happening. police searching a mansion in northwestern turkey belonging to a saudi citizen, after investigators determined that man had been in contact with one of the suspects in the slaying

of journalist jamal khashoggi. authorities say they were searching the villa for khashoggi's remains. mike pompeo welcoming the foreign minister to the state department, follows by a visit by pence to ecuador and the two sides agreed to resume military operations. search crews look for human remains in and around paradise, california the camp fire blaze, 100% contained, claimed the lives of at least 85 people alec baldwin appearing in a new york courtroom after being accruesed of striking a man in the face over a parking space. he departed after being arraigned on misdemeanor charges. you're up to date. that's the news update this hour back downtown to you guys. morgan, back to you. >> keep your hands to yourself sue herera, thank you. as we head to break, take a look at faang stocks in the green. tech tries to rebound, following

the worst week since mchar more "squawk alley" next don't go anywhere.

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from around the world. ( ♪ ) we even have live sports and news channels. ( ♪ ) and your free wi-fi will start shortly. enjoy your flight mr. jones. world's best inflight entertainment. fly emirates. fly better. major indexes seeing a lift in today's session after last week's selloff bob pisani is covering that. >> off the highs, 3 to 1 advance in declining stocks, they want a rally badly. look at the semi conductors. they rallied up and down 10% in

the last month you can see all of them up 2 or 3% that's nothing compared to oil services i have never seen oil services move like this 30% in a month some stocks moved. halliburton at new lows, are bouncing today you see 2 or 3% bounces. same with retail, up and down, but it is a rally in a day when you get amazon up with all of the competition, tiffany, tapestry and l brands. the reason the groups are bouncing, they're the most oversold pointed this out at the open s&p 10% off highs. oil services 40% that's not a typo. retail almost 20%. it is a big drop in a short period of time expect some kind of rally. why are we rallying? it is simple we are drastically oversold. below 15 on the 2019 pe multiple that doesn't happen often.

everyone hopes powell talks dovish i don't think so trump-xi cease-fire? as long as we don't get increases in tariffs in 2019, we have a victory a lot of hopeful, wishful thinking and finally, not a lot of news on the new high, new low list. general electric, another new low for general electric $11 going into the start of this month, remember, not historic lows, 5.70 in first quarter of 2009, but still, watch that carefully. back to you. >> bob, thank you for that look at shares of amazon up 4%. another big day for e-commerce expected today, cyber monday, on track for $7.8 billion in online sales, according to adobe analytics. jump of over 18% from last year, making 2018 cyber monday likely

the biggest online shopping day in u.s. history. so with us for the latest insights, head of commerce, jason woolsly and john blackledge good morning to you. >> good morning. >> jason, adobe has a treasure trove of data in terms of shopping what does that tell you so far about trends and how consumers put money to work? >> we're breaking records across the board. it is tremendous to watch. thanksgiving, $3.7 billion in sales. black friday came in at $6.2 billion the latest information i have shows that over the weekend consumers spent $6.4 billion, increase of over 20% year on year we are trending terrifically the season today, november through december, over 50 billion now. just phenomenal. >> do you have insight what people are buying, where they're

buying it? >> i haven't seen that with the graphic distribution, toys are hot, interactive dolls, interactive toys are doing terrific and video games >> john, one of the things i am tracking in adobe data over the years is growth of mobile. at this point this year it looks like it is 42.6% of sales thus far, barely trailing desktop does that translate into who you expect to benefit most from this continuing e-commerce surge? companies like amazon that were ahead in mobile and built a lot of capability into mobile platforms? >> yeah. for sure mobile is big for amazon what we would say is like cyber monday and cyber week is important for the company.

we expect amazon to generate $400 million a day in north american e-commerce on average in fourth quarter. while cyber monday is big and mobile engagement is big for cyber monday, it won't make or break the quarter for amazon in our view one other thing we noticed, amazon for cyber monday, and prime day, they push electronics devices, particularly recently the echo devices we estimate 23% u.s. household penetration of echo devices, almost double over last year that's a way for amazon to get consumers more consistently into their ecosystem. >> we have an extra week between thanksgiving and christmas what we have seen in the last couple of years, some of it driven by the shipping companies themselves that don't want to get snarled with too many packages coming into christmas, but we have seen this elongation of sales, discounts, and offers by retailers

how does that effect data? >> it brings data forward. we started to see some black friday promotions kickoff wednesday or monday of thanksgiving week. that's generated a tremendous amount of activity going into the holiday weekend. but we continue to see enormous growth even as we pull those in, we're breaking records on a daily basis. i think we have a good shot at having the first $8 billion online retail day today. >> john, in terms of shipping plans for amazon, i know they're moving stuff through the postal service, ups, fedex, but are continuing to build out their own transportation network i think they took final delivery on a cargo plane from atlas not long ago how should we think of that going into next year when you have price hikes from the likes of the postal service? >> i think amazon is in good shape. we did a project on their capabilities earlier this year

estimate 2 billion packages delivered in the u.s. this year, that's going to go to over 4 billion in five years. we think amazon is set up well we estimate they invested $12 billion in the fulfillment of logistics infrastructure the last five years, think they'll invest 40 billion in the upcoming five years. as they try to get closer to customers in big markets the other call on delivery for amazon is they want to control more of their own delivery, again, particularly around big markets. they want to be less reliant going to be less reliant on the postal service and are doing that in two ways one, they have local and regional independent third party logistics providers plugged into delivery stations and also they started a program this summer, the amazon delivery partner service program as a way to get entrepreneurs to start their own delivery companies and support the massive demand amazon has. >> jason, talking about mobile

earlier, it looks like mobile could catch up to desktop soon in the next couple of years in terms of actual purchase we talked about bricks and clicks the omni channel idea, shopping for something on a digital device, then going into store to pick it up, are we understating what will influence because of that trend, people aren't necessarily buying on the device but doing everything but >> we have seen an incredible rise in this buy online, pick up in store phenomenon. we started to measure data in january, it is up 120% since then for large enterprise, greater, 250% increase year over year for buy online, pick up in store behavior it helps consumers skip lines, pick up at their convenience, and know from surveys, merchants like to browse in stores up to 60% of millennials say

they need that in the store. >> thank you both. let's get back to gm general motors is going to close down at least three of it's semably plants by end of next year, cutting 16,000 jobs. on pace for the best day since october. joining us, former gm vice chairman and cnbc contributor bob lutz good morning >> hey, good morning how are you guys >> well, better than the union workers getting this news certainly. square this for us the union workers are talking about shutting down of the ottawa facility versus what's happening in mexico. what are some of the economic realities that put gm in this position and should we look at this as being industry wide or more gm specific >> well, first of all i think it is industry wide because you'll recall that chrysler cancelled

practically 75 to 80% of its passenger car lines a few months ago. ford did the same thing. everybody said oh my god, how silly. but it is not silly at all the hard fact is in north america, in particular the passenger cars simply are not in demand whereas crossovers and trucks are high dmanlemand. gm is taking out one shift plants that have been limping along on very low demand, short work weeks and the whole nine yards, and they're converting, doing a lot of conversion at the pickup truck plants, crossover plants so a large percentage of union

workers that will ultimately lose jobs in the plants they're currently employed at will be offered employment at other plants in the united states like arlington where production actually needs to be expanded, so this is just economic reality and it is going to hit everybody. >> bob, you were on with us last week and said ceos in general in your words should be doing what mary barra is doing, tell your teams let's take a slight budget cut, tighten our belts in case things get worse is that what this is about or is this more long term story on the model and shared mobility and changing tastes? >> no. i think as i said general motors is the last u.s. car company to eliminate passenger car models or a good percentage of passenger car models, so you can almost say that gm hung on in passenger cars longer than

anybody else did, but it's also a sign of changing times as demand shifts from lower, heavier passenger cars, and everybody wants upright vehicles with terrain capability called crossovers, and then i think general motors is also getting itself -- in the old days, this is not the old general motors, the old general motors would have raised incentives on cars and said oh, god, we can't close plants, we can't do this, what will the market say and so forth. nowadays gm looks at the hard reality, says we've got a demand problem on cars, what are we going to do about it we have to shut some facilities and move production to truck plants so i think what we are seeing is a fast acting and reality oriented gm management. >> bob, when you look at some

locations where plants will be idled, i can't help but think it is a balancing act in terms of the new nafta deal, given some of the rules of origins in that deal and the fact it requires 40% of vehicle value made in high wage areas like the u.s. and canada how does that play out >> i don't think the -- that it has much to do with it at a time when everybody had hopes that passenger cars would sell again and so forth, i really don't think it has much to do with that because some of the plants in highest demand which will have work force added to them are in the united states i don't think there's any shift to mexico on the horizon here. >> bob, you talk about some workers perhaps being shifted from smaller car plants to

crossovers and suvs that are more popular is that practical for many of these workers? are they in the same geographic area do you expect a significant number of these workers to find that employment? >> you know what, that's a question you would have to ask gm i have no idea how that would work out logistically, geographically, whether workers would move, et cetera, et cetera those are details that i'm sure that general motors hasn't even figured out yet, but you'd really have to ask them. >> bob, finally two questions. how do you think the president responds to this, especially how it is playing at the lordstown plant, and uaw say they'll challenge through every legal, contractual, collective bargaining avenue open to membership do they have a shot? >> i don't think so because when this contract runs out, general motors is free to close plants

and i think that's brave talk on the part of the uaw, they've got to show their members they're out there fighting for them, but in reality i'm convinced the uaw realizes just like everybody else that if there's no demand for a certain car, no demand for that plant, the plant closes down because you can't have workers show up every day and get paid and not produce anything that's just economic reality and the union knows it >> the more things change. bob lutz thanks for being with us >> thank you bye-bye. >> we got that halt on gm earlier this morning and now a halt on campbell's david faber is here with that. >> it is news we have been reporting on, not sure if campbell has been unhalted yet, ready to trade, it is in

agreement, they have been waging a proxy fight initially for all board seats, then to five. they've got a settlement let's tell you about it now that it is official and announced by both parties after the annual meeting on the 29th, campbell's will increase the board from 12 to 14 members, add two third point slate nominees, sarformer director an ceo of blue buffalo company, and they'll have input on the new ceo or ceo search and who will be that person and as well, they say that they will also have at least a third director by the next board meeting in may that they will consult with with respect to the appointment of so general settlement that was not unexpected, given what's going on the last several weeks,

trimmed down from 12 to 5, since campbell said it was willing to take two, ended up where we had anticipated in the last couple of weeks one key question here is value creation at campbell when dan lobe got the stock, there was not as likely as someone had foreseen lobe thought he had support of some family members, only to find out that wasn't the case. when their 41% was voting against them, no way mathematically he would be able to win this proxy fight. in some ways coming away with two board seats, not a bad hall when you consider the math was clearly against him. for campbell, they avoid distractions, they have a year lockup, go into next year, get the new ceo, which will have

input and conceivably put in place a plan they have been pursuing to try to reset the company in '19 and grow from there. coming off a not bad quarter last week which helped the stock, which interestingly is around the average price mr. lo built his stake in campbell at he's expected to stay in the stock for years to come and, again, they seem to believe there's real value that can be created by having a new ceo who leads the company to, obviously, sell those assets that are already on the block, delever the balance sheet and releverage soup >> you make it sound so easy >> shares are halted we'll see how it trades when it opens back up. let's get over to scott. >> here's what's coming up all that is riding on this week in the market, the fed chairman

speaking, if g-20 at the end of the week we'll tell you if this bear market has some saying power and one health care stock that might be right for your portfolio. all tathe top of the hour "squawk alley" continues after this break else... there are performers, dancers, designers the dads and the drivers. there are doers of good and bringers of glee. this time of the year is so much more than a bow and a tree. (morgan vo) those who give their best, deserve the best. get up to a $1,000 credit on select models now during the season of audi sales event.

oral arguments beginning this morning in the apple versus pepper supreme court case. here's more on the case. antitrust implications and how arguments went today >> reporter: at the heart of this case is whether apple has a monopoly over apps that iphone users buy because the only way to buy them is through apple's istore the question was really can iphone users represented here by pepper sue apple when apple claims to be just a distributor, not the makers of the app and an antitrust law the precedent says generally you can only sue the people you're buying directly from apple does charge a 30% commission fee which app developers factor into their pricing but apple argues it's just a agent and does not set the price. two lower courts disagreed to apple's role

apple said just by ordering your app through the app store doesn't make consumers direct buyers of the app and therefore consumers could only sue the developers not apple in today's arguments the liberal justices were much more active in questioning apple justice sotomayor noted the commission charges and the fact you could only buy apps on the app store bakes it a chosed wheel. justice kay again suggested that there's only one step then you are transacting with the monopoly in the counter argument, justice gore suggested the precedent still applies. iphone users should have the beef with app developers and not apple and maybe developers have a case against apple and not the iphone users the developers would be biting the hand that feeds them, right carl >> absolutely. perhaps one reason apple has gone red today thank you very much. for more let's bring in column

business school law professor, he joins us here welcome back so your thoughts of what we learned today so far >> it looks like as predicted the liberal justices are taking the side of the consumers. the conservatives seem to be taking the side of apple and i still think it's an important case i think it might go down the lines that people are expecting. >> what's your argument if you were arguing >> i actually think that apple should lose this case and not necessarily that they are a monopoly but when you go to the app store it's like going to a store and the idea that consumers can't sue a store that monopolizes is strange can you sue walmart -- you clearly are dealing with apple when you go to the app store that's my feeling. >> here's what i'm having a hard time wrapping my head around the majority of my apps are free

and the ones i paid for, it's not a lot of money why as a courtroom would have an issue. i want seems it's more of a developer issue. >> the idea is you're overall, over the years, ten years of buying things you will have paid that 30% surcharge and antitrust law is trying to keep prices low. maybe it's a little thing but multiple that against tens of millions of people doing thousands of purchases, couple dollars here and there adds up >> it seems the simple fix for apple here is to only market or make visible the apps that pay apple for higher exposure. if you want to be on the app store and nobody can find you, good luck. if people search they might find you. if you want to appear in the rankings -- it seems like lots of companies pursue that tack. amazon does it with companies that's in their third certainly platform versus those that

aren't will this get fixed one way or the other. doesn't apple have the distribution power even if they adjust >> there's one strange thing about this entire case is that apple is the monopoly of the app store. there's this thing android that people use there's this other big lurking issue in this case which hasn't been fully briefed this is focused on this question of who can sue it has a lieutenant to do with whether class action, plaintiff attorneys get in on the action or only government i know it's being reported as what happens with apple. but the real underlying question is who gets to sue apple, and is at any time plaintiff or the government >> do you see other outside of apple, potential ramifications separate from whether it's class or something else. >> whoever wins, if apple wins this case it becomes harder to sue a full class of companies who are kind of -- you kind of

transact with but kind of not. >> example >> let's say amazon. you buy stuff on amazon. the theory is amazon is a monopoly when you buy on the third-party market are you buying from amazon or from a third company uber for example, are you dealing with the driver or uber. it opens up these questions. if apple wins it makes it easier for those companies. >> if apple loses what companies to keep an eye on. >> if apple loses, i think life returns to normal. but if apple wins it's a big victory for everyone who can point to someone else. like uber, airbnb. >> that's fascinating. thanks we're watching for campbell's re-open. as faber said a few moments ago coming to an agreement with third point, adding two members to the board i think we have the resumption

of trade down 2%. between that and gm. and everything that's headed our way this week. powell and g-20. fed minutes on thursday. sales force earnings we'll get as well. >> yep that's coming. a number of tech stocks, including adobe. >> let's get to the judge. carl, thanks i'm scott wapner and welcome to the most critical week of the year for your money. fed and trade front and center as stocks stage a bear market bounce this is the "halftime report" and it's 12 noon >> announcer: a pivotal week for stocks is under way. we have a bounce from the bear if we don't get bullish news on wednesday and meetings don't go well this weekend will the floor fall in? one call to double down in emerging markets is this a golden opportunity to buy one big name biotech the "halftime report" starts right now.