♪ these boots are made for walking and that's just what they'll do ♪ >> live from new york where business never sleeps, this is "squawk box. good morning, everybody. welcome 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 check out the u.s. equities you'll see right now that things are in the red dow futures indicated down by 150 points s&p off by 19 and nasdaq down by 53 this comes after a very steep increase that we've seen for the markets across the board in fact, u.s. stocks are on their swiftest rebound in nearly a decade since the lows on christmas eve the dow jones industrial average and the s&p have built up more than 9.5%. that's the best ten day performance since july of 2009 s&p up 4%.

you are looking at some red arrows this morning. we'll talk about all of the reasons for that in a little bit. in the meantime, take a look at what happened overnight in asia you'll see that the nikkei closed down by 1 1/4%. shanghai down by 1/3 of a percentage point the hang seng was up by just oh 2 tenths of a percent. in europe it looks like right now things are relatively muted. the biggest decliner is the cac. down by over .6 of a percent you have declines in london. finally, take a look at treasury yields the ten year yield was all the way back to 2.78%. in corporate news, it is sad soap opera saga of sears it rolls on. the company stays alive. eddie lampert trying to save the

retailer he submitted a newly revised $5 billion bid. the company rejected the 4$4.4 billion bid. lampert and his hedge fund will be allowed to take part in a bankruptcy auction that would happen on monday. lamb per the's proposal which would buy 425 sears and k-mart stores is the only one that would keep the company alive that's important here. th that offer and any offer will keep it going. >> lots of employees waiting to hear about what happens with this. >> absolutely. >> hey, froggy -- >> you know, i'm losing my voice a little bit but, you know. >> you're here you're ready to play. >> here's the thing. >> i have to be efficacious with what i say. >> it's as good to be as parsimonious with your words as possible today if i say something and normally you'd be, oh, god, i've got to

push back. >> save my voice. >> better to save your voice. >> i will. i will try. >> some friendly advice. >> friendly advice >> you know what i was thinking we could do. >> man -- >> i was thinking this don't tell him. >> take advantage of a man down? >> no, i'm not going to. everyone who comes on here that gives an end of year s&p target, we should like have the squawk s&p target average because wouldn't you say -- i would say three or four or five months ago the s&p target average was 3 now everybody here their year end 2019 target is 2700. >> like a year end target is so stupid when you realize we -- >> that's what i mean. >> it's january 10th, we're up 10% from where we were at year end. >> that's what i said. we could easily be back -- they're afraid of their 3,000 target

i'm just saying, what it's an indicator of is -- but a lot of the positive feelings were -- that's what a correction is supposed to be supposed to get people questioning their motivation to hold stocks. >> people throw in the towel. >> did we get negative enough to where it made a bottom don't you think we could do the -- this is some proprietary stuff. >> i like it, but we kind of do with our davos indicator, too. >> we do >> i'm worried about the opposite. >> it's cold over there. if you go into it, froggy, under the weather, it doesn't get any better when you're there walking a mile and back uphill both ways. >> i'm going to be 120%. >> you've got to be. >> like our super bowl. >> then this, right? >> davos, big time. china released some -- poor eunice china releasing inflation data overnight. the country's commerce ministry releasing a statement about the trade talks that just concluded

in beijing thanks, eunice thanks for being patient she joins us now with the details. you still have as much time as you want as far as i'm concerned but i don't control things. >> reporter: thank you very much thank you very much. i'll pick it up from there >> no problem. >> reporter: as you said, commerce ministry did issue a statement. it was generally positive about the discussions, and in that statement the ministry said that the two sides conducted in depth and detailed exchanges and laid the foundation for resolving mutual concerns. at a regular press briefing later in the day they also said that the one day extension showed that the talks were serious. as these trade deals have gone on there's been a lot of focus on getting beijing to might good on the colleges. the ustr referenced that in its statement which it referenced

after the talks saying any agreement should provide for a complete implementation subject to ongoing verification and effective enforcement. well, today the commerce ministry pushed back on that saying china thinks a mechanism is important, too, and both parties have an obligation to keep their promises. so that comment shows that china doesn't particularly trust the u.s. is going to hold to its end of the bargain either. now amid all of this discussion the new chinese data showed that the economy continues to slow down at a faster than expected pace so the cpi and ppi both missed expectations consumer prices dropped to a 6 month low. consumer prices fell to the lowest prices in two years a lot of analysts have been worried about this including folks at nomura. they called this latest data worrying a lot of that is because this economy is very highly

leveraged. there's been a lot of talk that china could end up in a version and that will make the debt much heavier for the economy. >> how many days left? >> what is it, march 1st >> the clock is ticking, eunice. i know. >> the clock is ticking. >> keeping track for us? >> we're about halfway through that's one of the reasons why that there's a lot of pressure now. in these discussions it looked as though these mid-level negotiators were able to tackle some of the lower hanging frutd, if you will. the issues on greater purchases of american goods but so far we don't have a lot of detail on whether or not they made any progress at all on some of the structural issues that the usdr feels is really important, like the forced technology transfers and ipr protection. >> not a whole lot of time to

resolve some issues. >> how do they not subsidize industry it's the model, isn't it it's like separating the -- >> reporter: exactly. >> i don't know how you -- we haven't been watching this deadline because we have this other situation over here, you know, this shutdown. i don't know what ends -- >> reporter: the whole shutdown. >> the shutdown. >> reporter: no, it is you're seeing like a clash of models, but the way that the shutdown could actually affect these trade talks is that there had been some hope here that president trump was going to meet with the chinese vice president at davos, which is just a couple of weeks fromnow but now it looks as though because of the government shutdown president trump might not go. >> if it's not resolved in a couple of weeks, we're going to have bigger problems on our hands. >> it's a million -- now people are looking into the minutia of what has -- like what a government -- like there are people that make beer and they fill these big vats. before the vats can leave they have to be stamped.

>> elementary. >> they can't make anymore. >> they spend a lot of money on this some government person has to come in and stamp it. >> can't get a mortgage. can't get your tax return back again, this is before we really see a situation where anybody's missed a paycheck. that comes saturday. >> were you in a sporting -- were you screaming somewhere >> i thought you would have said that i was at an elizabeth warren rally. >> no, that's what i mean, aoc aoc delivered that pitch for the 70% marginal tax rate and you were screaming. >> we should have a conversation about that. >> you were screaming so loud in support that you lost your voice, is that real -- that's not really -- >> no. i was having nightmares. >> de blasio did the health thing and you -- >> no, i don't know what happened. >> okay. all right. >> eunice, thank you

tampa bay lightning owner jeff vennick is getting back into active management after a six year hiatus. leslie picker joins us. >> that's right. legendary stock picker jeff vinnik getting back into the game he returned $6 billion to investors. this morning he announced that he's relaunching vinik asset management the key question, why now? investors have been moving it. the average long/short equity lost nearly 7% last year under performing the s&p 500 and the broader hedge fund industry. but vinik says he sees those trends as, quote, opportunities even as they've caused other industry titans to go out of business in a statement this morning vinik says, quote, after six years of running my own money, the fire in my belly still burns. his plan is to use the same --

>> looked into >> the belly >> yeah. yeah yeah yeah that could be something serious. tums right in -- anyways, go ahead. >> he plans to use the same style of investing he has for three decades. his style is fundamental, bottom up company analysis layered with his views of the economy and markets. >> interesting i was around for the entire peter lynch era. he had a tough act to follow he was pretty good when they were looking for a successor -- >> right >> -- fidelity was of the biggest mutual fund in the world. who was after him? or was there somewhere before. a guy with an s name. >> i don't remember. i know he left in '96. >> is he his own seed investor or are there others. >> he's been running his own

money for the last six years today's announcement would theoretically launch a fundraising campaign sources close to it have said he's looking to raise it >> do we know what the fee structure is >> we don't know something that can't be disclosed. >> programming note. jeff vinik will be joining us at 8:00 maybe he can answer some of these questions for us at that point. leslie, thank you so much. we'll see you back here. >> magellan. it was tough to follow he was a proto ge. >> when we return, netflix has been on a tear in the new year we're going to talk about what's been driving the big moves after the break. then startup we work, you

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before christmas one reason for the new momentum, "bird box. 45 million accounts watched the thriller just in the first week alone. joining us to discuss netflix's rebound and what to watch for is michael graham, managing director and senior equity analyst for internet good morning. >> good morning. >> i guess the question is we talk a lot about "bird box" and i get that is that really why the stock's moved? >> i think the context is we had an awful, you know, end of the year in 2018 for the faang stocks and netflix was included in that. it was set up for good news to kind of help the stock i think the thing that's fueling it is the golden globes. they're built on creating original content and outspending any competitors by a wide margin. >> the idea of outspending their competitors seems like a bad --

no one usually gives people credit for outspending strategy. >> well, they don't if it doesn't work, but in netflix's case it appears to be working. the evidence that it's working is twofold one is what you saw in the awards the shows are winning critical acclaim. that resonates with potential survivors. you see it show up in the subscriber numbers they're just adding millions of subscribers every quarter, last quarter about a million in the u.s. and about 6 million internationally. this content strategy is working. >> what do you think is the upper limit they can spend how do you model it out? >> you know, from a cash flow perspective they're a long way from being tapped out. they're going to do 8 billion in 2018 they've hinted around 10 billion in 2019. we'll see if that holds up they have plenty of capacity to spend more of that

the second question is disney and apple. they will have the apple tv functionality available on the tv they can search through netflix, apple, everybody's stuff does that change the dynamic at all? >> you're going to see more competition. you're going to see little bundles of content whether it's through hbo, netflix, disney springing up in the new world of interactive television netflix is trying to go after subscribers through a whole bunch of different avenues, including their own bundling partnerships they're on verizon phones now. they're doing a lot of bundling deals with paid tv operators internationally. they're trying to reduce the friction of a new potential member signing up for the service and making it as easy as clicking a button. >> where do you put a hulu or amazon relative to everybody

else >> slightly different strategy i think it's smart of netflix to go after content that they really own because in the future when it's easy to switch from content package to content package, you don't want the same content that everybody else has. i think netflix is doing a good job. >> what did you think of the decision to pull one of the shows that was critical of mbs what does that say about their content strategy being in the news business is hard to be into. >> they've consistently stuck to the strategy of they want to invest in content that is on demand and they don't want to do sports, they don't want to do news they're doing a lot more unscripted. >> documentaries and things like that. >> yeah. >> critical documentaries about certain things.

>> they're definitely trying to develop local market content or local language content in the world. that's huge in india in the coming couple of years in europe they're getting pressure to develop at least, you know, a portion of the content in some countries locally. >> how did the electricity stay on in that apocalyptic -- that post apocalyptic world how did the garage doors still -- how did that happen why can't the scary things come through your window or your door why are they stuck outside do you think a pop tart if you were going to show someone what strawberries taste like, did you see that -- >> five years later. >> a 5-year-old pop tart tastes nothing like -- >> that's the only strawberry you're going to get five years later. >> i just read a review of it from someone -- >> actually, i loved it. >> someone at "forbes. i did my review with a blindfold on what do you think the stock is a year from now?

>> did you see it yet, andrew? >> "bird box"? no, i didn't. >> suspend your belief. >> you do. in a post apocalyptic world -- >> you're a "walking dead" fan how do you still have walking around zombiesive ar fyes later? >> how come every one of them dies you still have service? call the insurance company it's them, calling us. it's going to be a week before they can get through on these roads shhh, sorry, i didn't catch that. i said ask how soon they can be here not you. right now? what's now? he says they're surveying our property now they're probably at the wrong house i don't see any hovering his name is hovering? look up? by using machine learning and analytics to automate claims, cognizant is helping insurance companies advance how they serve even the hardest-to-reach customers.

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welcome back to "squawk box. we work is rebranding as we company. they're investing $2 billion more in the startup. de deidre bosas spoke with the owner. >> adam neumann and ashton kutcher spoke with us. the company awards entrepreneurs with millions in funding

i asked newman if he was disappointed he didn't get the full initial amount but kutcher jumped in to say any disappointment would be crazy. >> for some reason there was some expectation there would be a $20 billion, $16 billion it's a $6 billion raise. second largest venture capital investment of all time i'm an investor of uber. it's the second largest of all time it's softbank coming into this company. now they have $10 billion investment in this company the notion that anybody is projected that they don't have confidence is crazy. i have confidence in the company. >> he certainly has confidence because he also said he wouldn't hesitate to be an investor in we work at its new much higher blended valuation of $38 billion. on that deal neumann told me that massa san called him up directly and he gave insight into their relationship.

>> something beautiful about our if i have something i need to change or talk about or he has something. we prefer face-to-face meetings so we set up face-to-face meetings we meet in between two weeks ago we met in between japan and the united states. it's a real partnership. i think the longer we know the more we can build it he's one of the most visionary investors in the world his initial decision to invest took 28 minutes. including when he left and got in the car. >> the initial investment was in secondary shares to buy out existing shareholders without that, he is still confident that the business can expand now as we company

how are they profitable as they're currently growing? >> reporter: we don't have the latest numbers, but we do have sort of net loss numbers from the first half of the year quite simply the company is far from profitable. they are expanding very, very quickly. andrew, i know this is something you have looked at before. what happens to the company in a downturn we talked to adam about that he really pointed to the fact that they're building up more enterprise membership. they're getting longer term contracts for longer term leases that they themselves hold. however, the average contract is under a year so still some questions there. >> with rebranding -- we have to run. we'll talk to you later, deidre. we'll bring you more of that exclusive interor in the next hour. coming up, futures under pressure currently down 138 after a pretty good snap back. best in years, in fact, since the christmas eve lows we're going to talk strategy after the break. 7pgñóo?

welcome back you're watching "squawk box," live from the nasdaq market site in times square. welcome back to "squawk. we have breaking news from target want to get over to courtney ragan who's got the details. courtney >> reporter: hi, good morning, andrew target is out with its holiday sales results for november and december comparable sales grew 5.7%

that compares to last year's holiday sales -- comp sales of 3.4% growth. for digital, those are up 29% for the holiday months stores, a very key part of target's holiday strategy. in fact, stores fulfilled 75% on orders with order pickup and driveup actually growing 60% year over year target says all five core categories posted growth with market share gains the strongest performance by category in toys, baby and seasonal gifts target is maintaining its full year guidance. as a reminder that was for comp sales growth of 5% and adjusted earnings of 530 to 550 there is a calendar adjustment that happens in january that may account for some of that difference for maintaining the 5% comp when you have the 5.7% holiday comp growth.

separately there are som leadership changes as well that target is announcing including cfo kathy smith's retirement however, she's going to stay on with target until her successor is named and then after that point will transition to a leadership -- will transition to an advisory role, i should say i spoke with target very briefly and asked if they had any updates about the state of the consumer and they said, look, we're going to get more into that when we do our full earnings release march 5th but you don't see these kind of results with a consumer that isn't feeling that good. back over to you. >> it's interesting watching how target is kind of changing how they report some of these numbers and focusing so much more on the total including digital. >> yeah. >> obviously they're doing that because digital is such a bigger part of their strategy i know same store sales were up 3.3% do you know how that compares with what the street was expecting? the street has yet to i think catch up with the new reporting for some of these companies that are focusing so much more on

digital. >> reporter: exactly what also makes it hard to compare it to analyst's estimates, becky, we're only looking at november and december and most of the analysts are going to model for the full quarter. that's going to include the full month of january we don't really have a super reliable comparison for just that holiday quarter, which is why i think target gives us what they did last year i know it's not the same thing as an analyst comparison but at least it gives you a trend last year the holiday quarter for the comps grew 3.4%. another point if i could make about why they're sort of doing what they're doing and combining all of these numbers is because of what we mentioned with the stores fulfilling so much of those digital orders. >> right >> basically if the stores fulfilled 75% of those digital orders that means the distribution centers were only used for a quarter of what was used online for those two months which is pretty interesting when you think about how we talk about this tussle between online and store. >> the street's going to have to

find a differentway to measure it because the margins are different depending how you get these things >> right. >> no simple way to break out some of these numbers. courtney, thank you. >> it's complicated. let's get to the broader markets. joining us for that is kevin geddes president of fixed income markets at raymond james joining us on set this morning, chris hyzee. chief investment officer at merrill lynch and u.s. trust we are up almost 10% from the lows that were set two weeks ago on christmas eve, just over two weeks ago. kind of crazy to watch that kind of a move. do you feel confident saying that the bottom is in? >> well, it's hard to have a lot of confidence when you have wharkts doing wh markets doing what they're doing. the confidence is this bottoms are built. everybody will tell you something different, but over time if the base of earnings is above zero for 2019, then the bottom so-called numbers are in

we'll get a lot more of that information coming out in the next few weeks you're going to hear a lot of things thrown into the kitchen sink so the numbers are low enough so you can actually create a beat for the rest of the year markets got so low as it relates to the multiple, down close to 14 times earnings. we hadn't seen that number in a long, long time. sentiment was so poor, almost every sentiment measure you could look at was at its low to the point was it a bottom on numbers? it's tough to tell it's a bottom on sentiment. >> i hadn't thought about people throwing everything into these numbers and saying, okay, things are going to be awful trying to bring numbers down as far as they can so they can jump over that that in the short term, if that's what happens, could create a little bit of chaos in the next several weeks. >> and on the flip side, it could be that that's what the market was telling us over the last month, that the numbers were going to be poor. it caught a lot of investors by surprise oil prices corrected so much but

now look what's happening. the dollar's weaker. >> oil prices are bouncing back up every day. >> oil prices are bouncing back up that has taken out a lot of the fragility in the markets if you're a short-term investor you have more comfort. if you're longer term, when you get the times where the fundamentals don't correct, it's to rebalance unfortunately we did not see a lot of that. we did not see a lot of buying power on the private client side we saw a lot of nervousness. it lends itself to a 2019 that's better than what most people need to do. >> private clients you mean were running for the exits? they did not stand firm? >> they got myopic they basically stepped back and said, i don't know what's going on i'm very nervous about it. >> it's okay if they didn't sell, right? >> it's okay absolutely. let's talk a little bit, kevin, about the signals we're seeing from the bond market because that's been another cause of huge anxiety for equity investors, too

the signals that the bond market has been sending us aren't great but what do you think is going to happen? >> we think it's going to be a pretty good year for the bond market this started towards the end of the fourth quarter in the sense that the fed kind of blinked, in the sense that they took a more dovish tone. if you listen to any of the presidents yesterday, that was the theme and it probably will be with powell today when you look at an already in place weaker global growth and you add that to some weaker numbers in a u.s. economy and a dovish fed, interest rates have a hard time going up as long as inflation remains under control. we'll monitor this but we do like the way that all of the conditions are setting up for in place or lower rates in 2019 especially if the fed stays padded until likely june this year >> so you don't see a lot of movement from this point we have seen the ten year kind of rebound from some of its lowest levels on the yield, but you don't anticipate much more

movement this is going to be kind of steady as she goes >> yeah, it's going to be -- much like the fed, it will be data dependent even after last week's great employment report we gave up 5 to 7 basis points and we've driven it down almost every day since then i think those lower rate biases in place for this year until we see any kind of inflation. now we got some wage inflation out of the employment report we'll probably wait to see we'll get cpi tomorrow and ppi on monday. it's not like we're going to run away with inflation. so it would take another two or three months of big wage gains for the bond market to think that the trend isn't towards lower yields we made a big move from about october to december and then -- and likely we'll shave another 40 or 50 basis points off the ten year as the year progresses. >> one of the big narratives for the end of last year was that the corporate bond market is a ticking time bomb. there's a lot of -- that could really go wrong. is that true

what do you think happens this year >> it's been a good -- it's like the fuse may have run out on the time bomb but, you know, there was a fear of fed continuing to raise rates. there was the strength of the dollar which is hurting the emerging markets and we're worried about the economy being too strong or inflation being too strong most of that went away between december and january january has been a big issuance month for corporate bonds. spreads have come back in quite a bit and will likely continue to as long as these conditions are in place i see a much better year for the corporate bond market than we saw in 2018 both from an issuance standpoint, a demand standpoint and spread tightening in equities there was a great opportunity to take advantage of the wider spreads. part of that door is closing right now and we think it's a better year for corporate bonds. >> kevin and chris, thank you very much for joining us. coming up when we return, it could be the most expensive divorce ever amazon ceo jeff bezos and his

wife makenzi calling it quits. we'll tell you what it means. soprano's actor, this is going to be fun, did you bring any sauce for us, by the way >> good stuff. >> let's hope. steve schirripa is with us he'll talk about the 20th anniversary. >> billions without sopranos everything changed. and then later our newsmaker of the morning, jeff vinik is joining us he'll be getting back into active management after six years of hiatus. he'll be here at 8:00 a.m. right here on cnbc with a cockpit fit for aspaceship. hang on. radar that senses things the human eye can't. busted. and the ability to make a thousand decisions before you even make one. was all this, really necessary? what do you think? ♪

this morning amazon ceo jeff bezos announcing in a tweet yesterday that he and his wife of 25 years have decided to divorce. the tweet suggested it could be an amicable parting. he founded amazon in 1994 a year after they were married. she could be entitled to half of his value. $130 billion today it would make her the wealthiest woman in the world it would take him, who's currently the wealthiest man or person in the world to the fifth wealthiest has some real implications potentially for amazon as the company in terms of whether she might want to sell her shares or

their interests would diverge at any point in terms of control. >> it's had ard -- hard to have a personal divorce when it affects governance of a company. is there any reason to think that there would be a pre-nup? >> no, they both had nothing all of the money was made during the marriage. >> together. >> they worked together. >> he hired her. >> she might have a real -- she was there the entire time. there's no reason she shouldn't have half of it. >> if she didn't, i would say it's probably only because she -- >> you don't think there's a prenup >> no, it has big implications for amazon blue origin, he's been funding this. >> he's made the comment the only time he ever sells amazon shares is to fund blue origin. >> maybe she's not interested in blue origin. i don't know so, you know, this -- in terms of philanthropy, long term you would have thought kind of impact you could have, obviously that money together if it gets invested separately. now i will say, i just wanted to

comment because i thought it was one of the greatest quotes, i don't flow if you've read the tweet. i love when he wrote if we had known we would do it all over again. >> so sad. >> no, it's -- >> family with four kids >> i've always loved them together i have to say. >> for corporate governance for "squawk box. you can't have a totally personal life either you had a lot of things. i just wondered, do you have -- you don't have a pre-nup, do you? you had deal book. >> she's been with him since the beginning, too >> we have decided, god forbid, but we just would split the debts evenly, whatever we'd just go right down the middle, 50/50. >> look, i will say whatever happens with this, we'll find out more because they're going to have to release some of this in the proxy it will affect ownership of the stock. he's the largest at 16.3%. whatever happens they'll have to say. >> how do you sell a pre-nup to someone? >> i know. >> how do you sell a post-nup.

>> some hedge fund managers and others who joined partnerships, they don't have the pre-nup in advance but they need a post-nup because the other partners won't get in business with them. >> that's a sneaky way to try and pull a post-nup. that's ridiculous. >> just throwing it out there. >> it's kind of -- i don't like life insurance. >> but in case something goes wrong, do you mind signing right here >> right. >> it's a tough sell anyway -- >> but people are going to be focused on this. then it will become a gossip story. obviously -- >> yeah. yeah >> the girlfriend and this and that and when did they separate, all of that. >> anyway, we'll switch gears. 20 years since the "sopranos." i've been watching the marathon. it changed the way we watch tv, what we think about tv, what you can put on tv. ♪ ♪ >> we're going to be joined by a friend of the show, steven

schirripa. pesto, basil we'll talk about the "sopranos." 20th anniversary, which is today. at&t provides edge-to-edge intelligence, covering virtually every part of your manufacturing business. & so this won't happen. because you've made sure this sensor and this machine are integrated. & she can talk to him, & yes... atta, boy. some people assign genders to machines. and you can be sure you won't have any problems. except for the daily theft of your danish. not cool! at&t provides edge to edge intelligence. it can do so much for your business, the list goes on and on.

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♪ i woke up this morning and go my myself a gun ♪ ♪ always said i'd be the chosen one ♪ today is exactly the 20th anniversary of "the sopranos" and the debut on hbo, marking the beginning of what some called the golden age of

television joining us now is one of the iconic stars of the season, steven schirripa look at these words. even now -- you do this one? >> anthony abatamarco. >> on cbs' "blue bloods" and he has a line of tomato sauces i love under the "uncle steve's" brand name you were there from the start. >> i was there for from the second episode of the second season i auditioned in i think may or june of 1999 and the first -- my first two seasons i wore a fat suit. >> you did >> so if you see those early seasons i was really fat. >> i was going to say how good you looked >> then season four i went in for a costume fitting and david chase said "you don't need it" so i worked my way into the role but if you look, the second and third season i'm really big. >> because i mentioned that one scene that a -- a lot of scenes would be tough to watch today

because we're -- i think we're more sensitive like tony saying "why don't you get an effing salad" and he leaves and you go -- you insensitive -- i think he's referring to the other guy. but you insensitive [ bleep ]. >> he's saying you should start to seriously consider eating salads and you're a cannoli with legs and he's calling me all these names and i say to my wife, i said i'm not that much fatter than him. >> you said that under your breath you didn't tell the boss. >> and then, you know, they call me and say you have to come in early and get fitted for a fat suit. >> i was thinking about before "the sopranos," think about the violence was never like that on tv, never that graphic the sex wasn't that graphic. the language was never that graphic. so many things changed binging change. >> the leading man wasn't your

classic leading man, he was an overweight bald guy that was the right guy for the job and no one could have done it better. >> but he was a mob boss going to a psychiatrist and also the portrayal of italian americans across the board you've got a psychiatrist, you've got down to a button man. >> the thing about the italian-americans, most of us were italian-americans on the show not everybody, but most of us. david is also so there was nothing derogatory this was -- i always felt it was a story that needed to be told it's very true to life i mean, you know, let's not kid ourselves. >> that was another thing. >> these people exist. they're bad people that do bad things let's not kid ourselves but people were saying oh, it knocks it, a lot of times people were like i hate your show. i said did you ever see it no, but i heard about it. >> the entire landscape and --

>> what do you watch now yourself >> i like "billions. i like "mrs. mazel" a lot. it was the first tv show -- i could be mistaken -- that came out with the dvd and they sold millions of those big box set dvds, millions nobody buys dvds anymore, do they that business is out the window. >> there's no way i could let the 20th anniversary go by it was 1999, before september 11, before everything, before the iphone. >> and you know, 9/11 i remember we -- we were here and things had changed and i do that one scene with tony and i said mom's really gone downhill after the world trade center we're talking about notre dame particularly and all that. it was brilliant stuff the writing was brilliant.

michael imperioli wrote five episodes. >> what do you know about the prequel david chase is working on >> all i know is what i read i understand it takes place 1967 i was 10 at that time so i think it's -- the generation before, it's about the newark riots that took place in '67 with the italians and the blacks and i think that's the basic that's all i know. >> great to have you in. first thing i was going to say is wow, you've lost a lot of weight but it was a fat suit. >> but you've seen me since then. >> you know where i see you, campignolas. >> that's great sauce. almost as good as uncle steve's. unclestevesny.com. we went mail order you you on amazon? what does amazon do to your margins? >> we're doing good.

much better than the stores paying all these fees and the shelving you talk about the mob, supermarkets they're the mob. >> steve, good to see you. great to have you in when we come back, u.s. equity futures have been under some pressure this morning the dow is down by 132 points. s&p futures down by 18 the nasdaq off by 50 we will talk strategy after this break. later, our news maker, the former manager of the fidelity magellen fund is getting back into money management. he'll join us at 8:00 a.m. eastern time "squawk box" will be right back. we're drowning in information. where in all of this is the stuff that matters? the stakes are so high, your finances, your future. how do you solve this? you partner with a firm that combines trusted, personal advice

with the cutting edge tools and insights to help you not only see your potential, but live it too. morgan stanley.

will the d.c. drama derail the rally? president trump storming out of a shutdown meeting with democrats. guest hose and former house majority leader eric cantor joins us for hour to talk politics and your money. deal making in 2019. we're joined with the morgan stanl stanley, many and, a. >> plus, tusk venture ceo bradley tusk is here as the second hour of "squawk box" begins right now >> announcer: live from the beating heart of business, new york, this is "squawk box."

good morning, welcome back to "squawk box" here on cnbc, live at the nasdaq market site, i'm andrew ross sorkin along with becky quick and joe kernan. nasdaq is looking to open off, the dow is down, s&p 500 down about 17 points. becky has headlines. in those headlines, let's tell you what's happening. after a three-day meeting on trade, china's commerce secretary said negotiations were extensive and will help set up a foundation for further talks if both sides are unable to secure a comprehensive trade agreement by march 2, president trump says he'll raise tariffs from 25% to 10% on $200 billion worth of chinese imports. elon musk says tesla will stop selling the cheapest version of the model-s and model-x cars in a series of tweets overnight he says tesla will stop taking order for the cheaper low-range

models starting monday and sears chairman and larger shareholder eddie lampert reportedly submitted a new $5 billion bid which may be the only hope to keep the iconic retailer alive the latest comes after his initial $4.4 billion bid was rejected as inadequate it fell short on several fronts including not covering sears' administrative costs as part of the new bid, lampert will cover the company's tax and vendor bills if sears accept this is offer as financially viable lampert and his hedge funds can take part in a bankruptcy auction that takes place on monday. >> you know they always say we only do bad news, how about this bed bath & beyond. >> our favorite place. >> did you see this? shares are soaring the company's third-quarter earnings and revenue beat forecast the company offering bullish guidance for the full year if you ever get down, think life is steedus like us, go into a bed bath &

beyond and look around duvets and -- everything -- >> vaporizers, i love the vaporizers >> across the board, things you can use in the house that make life better. >> all the k-cups. >> it's a veritable toy store for just everyday families. >> none of the three of you know what you're talking about. >> i do know yes, i do. >> okay, all right. >> big fans. >> we like people to have homes. housing is a big part of the american dream kb home fourth quarter results topping forecast home deliveries were up but the average selling price sell 5% and kb home up more than 14% in the last month we saw a similar situation in chart with lennar yesterday. well, the government shutdown in its 20th day talks to tend standoff broke down yesterday ylan mui joins us now.

you've lost share, ylan. share wants the democrats to fold now which i think that's a turning point. what do you have >> joe, the shutdown has now turned into a meltdown talks were called off after a confrontation between house speaker nancy pelosi and president trump in the situation room of the white house. trump tweeted this version of how it went down he called the meeting a total waste of time and that he asked pelosi if she would approve the border the ball he reopened the government nancy said no, i said bye-bye, nothing else works chuck schumer, the top democrat in the senate, said democrats were ready to negotiate until the president literally walked out of the meeting. >> the president just got up and walked out he asked speaker pelosi "will you agree to my wall?" she said no. and he got up and said "we have nothing to discuss and " and we walked out we saw a temper tantrum because

he couldn't get his way. >> today president trump will get a briefing on immigration and security that's part of messaging this issue as about safety, trying to show the urgency of what he is calling a crisis now what was clear after the president's meeting with lawmakers at the white house and sclil that even republicans aren't sure what the exit strategy is here alaska senator lisa murkowski said the president gave them no clear direction. he could still call a national emergency but the gop is split on that and even supporters say that that would be a last resort lindsey graham set up an informal working group to come up with other options but after friday this would be the longest shutdown in the nation's history. back over to you right now that the democrats control the house, gridlock fears plague the new congress, but the problem solvers caucus passed a bipartisan rules agreement for the first time in 20 years, building hope for a productive legislative year.

joining us is congressman josh gotheimer of new jersey and our guest host is former u.s. congressman eric cantor. congressman, thank you for being with us today. it's good to see you. >> good to see you hey, eric. >> hey, jamal khashoggosh, happ. >> it's hard to see how anybody from the two sides are getting together in washington these days what's the outlook first of all for any sort of solution to the shutdown >> go ahead, please. >> i'm not sure if you're hearing us my question is, what's a bipartisan solution to this shutdown >> we need to have both sides actually continue to sit at the table.

people are suffering it's costing businesses in my district and across the country and on top of that, we need to have tough borders we need to keep out terrorists and criminals and gang members but there's no reason why you can't do both. what i keep pushing for -- in fact members of the problem solvers caucus are getting together to say is there a place we can find common ground and work together. the idea is to work together and not walk away. >> how many congressional people do you have sitting down who could agree this because from the leadership the two sides you don't hear any of that. >> well, you have a lot of members that are getting together they've been getting together for days to try to figure out is there a way forward. i understand we'll have people walking away and leadership has to take their position but plenty of us think we have to keep working on it to get things done. >> how many people are we talking? is this 20 members 50 members >> our caucus has 40 plus members. half democrat, half republican. >> but we are looking at a shutdown that has never -- once

we get to saturday it would be the longest government shutdown ever it would also be a day after you actually see federal employees missing their paychecks for the first time do you think we'll be talking about a shutdown a week from now? >> i hope not. i'm optimistic if we keep sitting down at the table we can get things done. yesterday we passed the house, again, to get -- we passed once again like we did last week more bills to get the government back open we passed -- open more agencies yesterday. we'll vote on more today and it's going over to the senate. now it's up to the senate to pass the legislation and get it to the president we'll keep working and doing our job. >> congressman, would you vote yes for -- i heard at one point the president said $2.5 billion. would you urge congress -- speaker pelosi to say, okay, let's do $2.5 billion, we e'll meet you halfway because they're not going to they're at zero and this is definitely a political -- they can make a stand and they want

trump to have to come crawling back with his tail between his legs and open the government without anything that's the end game for speaker pelosi and minority leader schumer, isn't it? >> i don't think -- i'm not going to speak for either one of them i'll tell you what i think i think actually both sides need to keep working on this and i'm -- obviously i think there's a deal to be had here. you can have tough borders and reopen the government. there's no reason why it's either or. it's both of us sitting down and i would think that's why it's ridiculous -- and you'll hear this from a lot of my republican friends -- both sides think it's ridiculous people are walking away so i think we need to keep doing it that's what i did in business, i know that's what a lot of people watching the show doing do everyday, and there's a deal to be had here. >> let me ask you something, just getting down to brass tacks, though. what is it really that's driving this i know from the experience i

had, the 14 years i was on the hill that there is a loud voice in the primary base of your party as there is in my party and isn't it -- isn't that what's driving the opposition on your side of the snooil your primary base says there is no way we can agree with anything this president says. >> on a dollar. >> she said maybe a dollar. >> right. >> isn't really that's what's going on here? anything donald trump is for you can't be for right now so i ear at an impasse. >> i think you're right to say extreme ideologues on both sides are the ones who are unwilling to move and if you're going to taken a all or nothing approach to anything, you'll never get anything done. the problem solvers caucus, our whole point is to find the common sense common ground where people can get things done and this is a case where i'm telling you, we had a conversation last night about this, we believe in tough borders. you need to have tough borders to keep out criminals and gang members and terrorists

but you can also reopen the government because there's no reason why our skies should be a risk with the air traffic controllers. there's no reason why small businesses in my district, a microbrewery out there, they have a million dollars of equipment, they can't open their business because they're waiting on permits and the government shutdown so you don't want to hurt small business in the process, hurt growth, hurt safety while you're trying to get this done. >> where are you in jersey >> he's my congress. you don't sound like a -- you're not from san francisco, you're not from that district >> from bergen county. >> oh, bergen county. >> we have a lot lower taxes here. >> you sound almost reasonable, josh i don't know i'm not hearing that -- >> that was a republican seat for a long time. >> that's why the key is not to watch the screaming on television, the key is to actually -- you know, this eric. you have to sit down at the table and there's plenty of members who just want to get this done saying let's figure it

out. >> you want to secure the borders. >> of course you >> do i don't think everyone in your caucus does i've heard this nobody's illegal on stolen land have you heard that one? >> no. >> yeah, nobody's illegal on stolen land. check that one out. >> but here's what i've heard and i understand members of the other party say this, we've actually got to sit down, figure it out, get it done. you asked if we'll get this thing open i think if we follow the plan we will and that's the right thing to do. >> we have seen a small business in your district that ran into trouble like this. you've heard of people who can't get through the irs and social security. >> lines at airports >> but it's not been a huge massive swell because most of those people, all of those people, unless you're a contractor, are still getting their paychecks. after storm you'll see a lot of

people, 800,000 people, that go without a paycheck and then i can only imagine the the pressure is going to come down on every single congressional member on the white house all the way down the idea that you have tsa agents who aren't going to show up or things along those lines how do we resolve that is that what it takes to break this >> i think every single day we're seeing more and more pressure and it's not just, by the way, going to be the paychecks that will hurt a lot of people and you'll hear about that it's starting to really -- what i'm hearing from my constituents it's affecting everyone's lives. whether it's a line at the airport, getting the refund checks back. it's the businesses that we keep hearing from that can't get their small business loans it's really having an impact on the economy so that's when you'll increasingly hear from people >> to this point you've still had tsa agents showing up, maybe some sickouts in an airport here or there but if they're not getting a paycheck and you still think they'll show up everyday -- >> i agree, i think it's going

to really see the impact of this that's why i think again we have to get it done and i'm optimistic and we'll keep working on it. i see a path forward here but it takes talking to each other. if we walk away, nothing from get done. >> listen, it doesn't look like to me, again, given the experience i've had down there, it doesn't look like to me there's a deal in the works. so what happens and what is your reaction how does your caucus react if the president takes the step to declare a national emergency how does your caucus react to that >> i can speak for myself. the president has lots of authority and i'm sure it can take plenty of steps but is that the step we should be taking or should we keep working on it and my understand would be let's keep working on it and there are actually plenty of people right now, i'm just telling you, who may not be on tv but who are working and trying to find a way forward there is a deal to be had here and it's like anything if you keep working on it plenty of us think we have work

to do, we have to reopen the government, we have to make sure we invest in infrastructure, especially jersey, fix the roads and bridges. >> at the end of the day, nancy pelosi, she can bring a bill right now to the floor and y'all can pass it next hour, wherever you go convene today so that's not the question the question really i believe is is -- when is the president going to come your way i don't think that that's happening. so the real question is how do you and your colleagues and democratic caucus react to invoking of emergency powers by the president when he decides that we've had enough, we need the wall. >> you also just brought up a good point there's pressure building not just here but also in the senate i've spoken to several of my republican colleagues in the senate who are saying it's time. we passed legislation yesterday to reopen the government, i think you'll see more and more people in the senate start to consider this and put pressure over there to say let's get bills to the president's desk,

let's have them sign them. if we pass that out of the house which we did yesterday to reopen the government, send it to the senate and let them send that to the president, that's a key question when will they step up over there and get it done and send it to the president, reopen the government -- >> i don't see this president backing down i think you're right, that will most likely happen next week i think you're right but i think the president won't reopen without the wall. >> well, you can have border security but also actually reopen the government. we'll see. that's why we have to keep working on it. we'll find the sweet spot and the pressure will keep building from the public to get it back open. >> congressman gottheimer, thank you for your time today. >> thanks for having me. great to see you. >> josh gottheimer is the co-chair of the problem solvers caucus. >> coming up, more to talk about. your morning business headlines with moving markets and later tampa bay lightning owner and investor jeffrey vinik

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look at the dow futures, down 103. off what we saw earlier when we were down over 150 s&p down by 15, nasdaq down by 42 but this comes after at least four days in a row of gains, s&p has been up for four days and that's the first time that happened since september. >> what's coming up from davos >> yeah. we'll be outside -- i'm literally type ago note about davos. >> why do you think we need to be outside. >> it was pretty coming up, the big market movers will take a quick look and then later deals in 2019 morgan stanley vice chair and head of global mergerings and acquisitions robert kindler is our guest. our guest. we will be right back. right? no. uh uh. is it homeowner's insurance? no... uhuhuhuh! is it duck insurance?

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unfortunately, in 2 or 3, hours. why the delay? cognizant is helping banks use digital technologies at scale to advance speed to market. let's get to dom chu with a look at this morning's market movers good morning to you, dom. top of the morning to you and the gang as well, andrew let's start on the aerospace and defense side of things boeing and lockheed moving in different directions driven in part by analysts at morgan stanley upgrading boeing to an

overweight and downgrading lockheed to an equal weight. the bullish thesis for boeing surrounding the profit and cash flow profiles of the company in the resilience air thanks to better industry trends in commercial aviation specifically the opposite trends on profits and cash flows for lockheed given the benefits seen from the f-35 joint strike fighter leveling off those stocks moving in opposite directions you have a couple social media stocks in the news as well twitter getting upgrade bid bank of america, merrill lynch to a buy rating thanks in part to modest improvements in user metrics. snapchat parent company getting upgraded to a market perform rating citing better option by advertising buyers and that sharp selloff in shares we saw over the course of the past year and then there's constellation brands which, yes, got hammered yesterday after its earnings report and forecast. it fell enough to get an upgrade nod from goldman sachs citing a compelling risk reward with beer trends staying relatively

healthy and headed into fiscal year 2020. the price target there, though, was cut to $211 per share from $243 still after a big selloff a nice move upside in constellation brands and some other upgrades as well. back to you. >> thanks. our guest host this hour is eric cantor, former u.s. congressman of virginia who served as majority leader. he's now a managing director eric, in terms of your day job and where you are now, how do you describe the last two months what do you think went on? what is going on right now >> i think just in general obviously volatility we're seeing in the markets is something that i don't think anybody can ignore, especially big shareholders out there i will say though we're not seeing any of this volatility in the fundamentals of our business the market is viewing something

in the future as bad but i tell you one thing, there is still obviously here at home a lot of economic growth to celebrate there's confidence in the part of our clients, our business is good this kind of shenanigans going on, the uncertainty around brexit, we'll see that come to a point next week, the lack of leadership in the eu, all of this on top of that the trade situation with china and the talks. so i think serve on edge. >> in terms of funding, whether it's short term or anything in -- like credit-related? spreads there, junks, all that stuff? there were some signs of stress that may or may not have been real and it seemed to come since powell was a long way there from neutral and second with the autopilot on the balance sheet people were saying there were signs of some pending illiquidity that could be

problematic. did you see anything >> we believe the credit markets are still very healthy but you're right there was a lot of discussion about that the spreads began to at least seem that they were going to widen. but, you know, i believe in what has gone on and propelled business confidence which was initially two years ago with the onslaught of the deregulatory process together with the tax reform that put a lot of people in a much better situation so if the kind of volatility we're seeing in the markets continues, it may start to zap the confidence inside the c suite in the board room but i don't think we're seeing that kind of doubt the way you're seeing >> was powell right or wrong about the strength of the economy in december.

>> do you remember -- >> this is the push and pull here if you raise rates, that job growth number we last saw was phenomenal. >> i wonder if oil and copper and rates give us financial false flags that aren't based on the underlying economy can't financial influence that does global demand for oil have to fall off? do we have to know the economy is in trouble for copper to hit lows >> is it always a sign is it always an indicator or a false indicator, a false negative. >> i think that when you sit here and the rapidity of information flow in the back and forth we can talk ourself into become a self-fulfilling prophecy in the underlying fundamentals

we can see as strong as it was six months ago and there's a little disconnect and i know from the veterans who have been on wall street for a long time they're saying the markets know what they're doing. >> we're going to hear a lot from schumer and pelosi about the pain cost for people not getting paychecks and families not being able to make ends meet and it's going to be all pointed at petulant trump, we keep hearing it again and again and again. it does take two to tango. they could do $2.5 billion and then immediately the government would open so all the people they're talking about don't need to be put in that -- in their mind don't you think these people are pawns in the game they're playing as well? if they were so concerned about the people getting hurt. both sides are so entrenched.

>> the incentives in place don't point to any of that -- >> i think it's cynical to hear them talk about how badly they're feeling for them and to know full well they're just as intractable -- >> you can point on both sides he says he feels the pain. no he doesn't. >> i think we all agree there's probably a place in the middle the problem is that these sides have been set and i have to -- dare i say, the heels were initially set by the president and that's what made it very difficult. >> no, no, no -- >> that's not a fact. >> you'll hear both sides the incentives are yield-to-yield to the primary base. >> i don't disagree that. >> there's no way -- >> and there's glee when the president made the move to say we're shutting down the government unless you do this. there was glee on the other side, too, to say great, we've got him. >> but why keep saying we're talking about a 2,000 -- that's the strawman they keep putting up we don't want a 2000 miles concrete wall and we're never

going to say yes but no one is talking about that anymore they're talking about all these different ways to secure the border with a very small amount of money i would have left the meeting, too, if someone said -- trump said if i open the government now, within 30 days will we be able to get a deal for the wall and she said outright now. that's when he turned around and left but you don't see that in the -- >> look, the wall has become a symbol, that's the problem and he's made it the symbol and that's the issue that we're at here. >> when did the wall -- >> it's not about the practicalities of illegal immigration. >> do pelosi and schumer want to go down and tear down the existing structure are the current walls imsnorlmo? >> as a result of this discussion, we're not talking about the issues about whether people are overstaying visas, about e-verify all of these issues i would imagine conservatives would be

saying -- >> the conservatives are saying we need the dreamers. >> we can't get into any of this without the wall. >> who is the saying we can't get into this without the wall that's the point that's the point. >> both sides because they're intractable right now. both sides >> and they share responsibility for the people not getting paychecks, andrew, not just petulant -- the spoiled brat anyway. >> when we come back we'll have more headlines plus the downturn in the market and company valuations an outlook for deal making in twiebt and why startups may have a tough time coming to market. also, investor and tampa bay lightning owner jeffrey vinik is getting back into the fund business he is our special guest this morning. right now, look at the u.s. equity futures under pressure. dow futures down by over 100 points s&p down by 16 and the nasdaq off by 47.

we want to talk mergers and acquisitions and the roll activism could play as driving deals. here to discuss all things m&a is robert kindler, global heads

and acquisitions of morgan stanley. thank you for being here we were talking to -- >> we won't talk about the wall? >> you want to talk about the wall no, i'll ask you this, do you think the wall and/or the government shutdown is having an impact on confidence in the board room >> i don't think so. it may delay deals but i just saw steve schirripa who i am friendly with. he's friends with my cousin. he tweeted he hears mexico is offering to pay for the walls closing in on donald trump and then immediately after that vincente fox retweeted saying "andy, where do i send in the money? so the thing kind of got -- but the shutdown itself i don't think will have much of an effect it will delay deals. ipos can't happen and deals that you're trying to get through

cfius approval and other approval, it could slow things down but ultimately the government will reopen. >> let me ask you, given the quote/unquote uncertainty out there whether it be around china or brexit or where the stock market will be, do you see this as a robust m&a market right now we just had two -- we said we had two big health care deals in the past week. >> i think what usually affects m&a is volatility and if there's a lot of volatility in the market, big, big swings then i think m&a does get affected. >> the question is how because i feel like the volatility helped these last deals prices came down to places where people could make a move. >> it's a question of where will things be settling out you're right the fact that stock

prices have gone down have made deal mrs. likely to happen. >> what have the tariffs done for chinese companies? >> they're not happening deals that involve a chinese company very difficult to do there were almost exactly the same number of deals the reason the volume was up is there were a lot of large deals. >> and given the tack lash we keep hearing about, how much are they hamstrung to do deals so can -- there was speculation amazon might buy regional sports networks could they do a deal like that in this environment? >> i think there would be political aspects but you have

to remember they don't do a lot of deals, amazon never did a deal of any size before whole foo foods. so this concept, they were never doing large things >> so if there's one two industries that we'll look for major headlines talking about on squawk, what would be the industries you look for right now? >> it's been broad based probably there would be health care and bio tech on the heels of the bristol-myers deal so i think someone in bio tech, more industrial consolidation. >> and the other question was activists have been such a huge player in all this but it feels like activists didn't do well last year. >> it's interesting from a couple of things i said as you guys know on squawk that if i could short the entire activist class i would short it they've run out of ideas ideas meaning companies that

could get easily broken up or sold so as an asset class, they've done really poorly and if you look at what's happened, dan loeb shows up at campbell's, stocks lay down. icahn shows up with xerox, scuttles the fuji deal, nothing happens. we'll see what happens, but those were values way, way below. having said that i spend, i'm sure, a lot of times on activism because boards know that there's a high likelihood they'll have to face it so boards are preparing for it they're -- they're becoming their own activist or figuring out what their vulnerabilities are so overall for the capital markets it's good but as an asset class, they've done poorly. >> given the ipo market and potential volatility, do you see companies that say then to go public in 2019

do they end up becoming m&a targets? >> i think they might. i think they might if valuations stay down, i think that's more likely because the fact is that we do have a little bit of a lull in the high-yield market but that market will open up again valuation is down generally. but with valuations down generally, when the financing markets open up again, it doesn't really matter what the rates are. >> it becomes a buyer be bought situati situation. >> where is the private equity world? just dormant they will be active buyers this year they will be returning back. i think we'll have a return to more go privates public companies going private because you can write very large checks now, $5 billion, $10 billion checks and so if the market values stay down, i think that's a real possibility. >> okay, robert kinner will

mort -- kindler morgan stanley brother tweeting about the wall. >> coming up, how the downturn in the stock market is affecting company valuations, deals and the promise of going public. plus, speaking to the ceo of we work and sashton kutcher, their thoughts on how soft work is trimming another anplned investment "squawk box" will be right back. put your data to work on the cloud that drives business. the ibm cloud. the cloud for smarter business.

adam neumann

still to come, the wework

ceo and partner ashton kutcher, the rebranding of the company and much more. exclusive comments a s ars are t plus, tusk venture ceo bradley tusk. as we head to a break, the pre-market movers in the dow, it looks like beoeing is leading te way, verizon and nike also in positive territory "sawbo wl rhtacquk x"ilbeig bk. ♪ ♪ memories. what we deliver by delivering.

a business owner always goes beyond what people expect. that's why we built the nation's largest gig-speed network along with complete reliability. then went beyond. beyond clumsy dials-in's and pins. to one-touch conference calls. beyond traditional tv. to tv on any device. beyond low-res surveillance video. to crystal clear hd video monitoring from anywhere. gig-fueled apps that exceed expectations. comcast business. beyond fast.

welcome back to "squawk box," wework rebranding itself after a deal with softbank fell through. diedre bose talks to ashton kutcher. >> adam kutcher was quick to point out that while the softbank investment was left that originally planned, half of the money will be put in at a post-money valuation of $47 billion. still, i pointed out the inpollution was billions less than anticipated and i asked neumann if that changed wework's ipo timeline. >> so not at all and even with the deal happening everything was on the table there was no commitment in that deal to do or not do anything. >> he also said wework is already ready for public markets and when it does ipo, he looks to people like jeff bezos and marc benioff who are able to

keep their eye on long-term vision ashton kutcher is on the other side as havec investor and he's a backer in uber and airbnb. i asked him for his take on the landscape and he said he doesn't care if either of those companies go public or even the year after. >> the minute you start having to report publicly you have to start playing games with your numbers, you have to start playing games with your growth and usually the person that loses in that situation is the consumer so if we're trying to create extraordinary experiences for consumers over time, the longer the companies can stay private and by masa enabling that, the more unbelievable the experience. >> guys, i'm not sure other investors would feel the same way. many of the biggest unicorns, including wework, are close to 10 years old or more and that is a very long time back to you. >> diedre thank you very much. diedre bosa. joining with us what this

may mean in 2019 is bradley tusk, ceo of tusk ventures tusk has advised companies including uber, bird, handy and lemonade and the tusk veb which you are partners portfolio includes fan dual, circle and coin base.nture partners portfolio includes fan dual, circle and coin base let's talk about what ashton kutcher just said. this idea that as soon as you go public, the minute a company goes public you need to play with your numbers and playing with projections and that the consumer is the one who loses. that doesn't feel -- >> i'm not totally -- i think ashton is a good investor but i don't agree for two reasons. one i think ultimately the point of being public is to provide more transparency of the company and its practices. certainly more than you see from a private company and second from an investor standpoint, as someone who has been in uber since 2011, i wish we had gone public the $90 billion valuation target that came out is great but that would have been considered on the low end in 2016 or 2017.

>> really. >> yeah, i think so. >> because it's down from 120. >> and also down from uber being in a position of incredible hype and excitement and enthusiasm to having a year and a half -- >> i'm not questioning your underlying idea that there was more hype, more momentum that would have been behind it before but when i hear $90 billion i think that's a very high number. >> it's a big number but in 2015 and 2016 people were thinking $100 billion but had you gone public then with the hype people thought helicopters and self-driving cars were going to happen and you're playing against a very difficult comp, you have employees being insent surprised on the new stock. >> but at a certain point as havec we want our money as soon as we can get it but generally

speaking at a certain point you have to go into the public markets and deal with the challenges it brings and yes the stock will go up and down but if you try to avoid that forever i'm not sure why you're doing this in the first place. >> we heard as soon as volatility kicked into the markets, even beginning of october that people were already concerned and thinking about not wanting to take companies public when we've seen the market move up almost 10% just since christmas eve does that change or does the volatility and the concerns about volatility hover over everything? >> i think it's hard for anyone to say this is the day you should go public the whole point of the show is investors are trying to glean information to make decisions so if you're uber or airbnb or anyone looking at 2019, that's what you want to do, you should

do it and trying to read all the tea leaves is impossible. >> where are we? if you think we've missed the golden age for anybody to go public, how would you grade. >> when you look at the list of companies going public, you say what is the great american innovation, that's what -- but as andrew pointed out, companies have to keep growing and start making a profit and doing things >> rob kindler was just here and he made an interesting comment towards the end, he said he think there is will be public companies that go private this year can you have it be a great year for public companies to go private and private companies to go public or does it have to be a binary. >> i'm not sure it's binary. i think ultimately sometimes lots of excitement drives

momentum and enthusiasm. >> what's the chance of those companies on the list? i'm looking at slack, maybe ones that are smaller just get taken out. a microsoft, an amazon, a sales force. >> slack is a great company. >> these guys own the enterprise messaging component for a huge part of corporate america and the corporate world. >> it would be hard for uber, airbnb and pal tier to do that but they think if they can get close to the price they want, it's worth it. >> what's your take on wework and softbank which has been behind wework and even the investor base behind them which is saudi, how much money they have their interest in this stuff and what it's done to valuations long term. >> softbank is a unique animal skoi sequoia has an $8 billion fund and that's a fraction of what

softbank has raised so it's hard to almost assess what their impact is. in terms of wework, it's binary. either you believe they have figured out the future of commercial real estate in which case even the current valuation of $47 billion is probably undervalued or you think it's a well-designed and work around in which case it's overvalued and it seems like it either resonates with you or doesn't. >> bradley, thank you very much. bradley tusk of tusk ventures. our guest host for this hour has been eric cantor former house majority leader eric, some final thoughts. what we see in the markets but what you expect to have happen with the government shutdown. >> i think we are into a period of sustained volatility across the board and we've talked this hour about the trade issue

valuations, market but i think washington also. washington but also leadership across the world is facing an uncertain time if you asked theresa may what she thinks will happen, i know what she wants to happen what about emmanuel macron can he tell you what will happen or even angela america so i think we have to -- we have a vacuum in leadership. >> what about you? vinik says he's still got the fire in his belly for managing money. he hadn't been doing it since 2013 do you have to fire in your belly? would you run for house again? >> i tell my partner, i always say never say never in life. >> so you might. he's thinking about. >> it but i will tell you one thing, i am blessed to be where i am and feel good sitting here with you. >> sorry you're not in the middle of the negotiations >> so you'll never go back >> listen, i'm good.

>> he's running. >> no, i'm not. >> eric, thank you coming up, more on "squawk." ownerover the tampa bay lightning jeffrey vinik is jumping back into the fund business why now in his big market call look at futures ahead of the open just an hour and a half right now.

stocks on the move fie

futures in the red after four straight positive sessions for the dow. we'll show you what's dragging down the index. the case for hedge funds we're joined by jeff vinik who is back in the game. and defending the fed. as president trump criticizes the central bank, we're joined by kansas senator jerry moran, one of the biggest congressional supporters of fed independence as the final hour of "squawk box" begins right now. ♪ very superstitious writings o the wall ♪ >> announcer: live from the most powerful city in the world, new york, this is "squawk box. >> good morning and welcome back to "squawk box" on cnbc live from the nasdaq market site in times square i'm joe kernan along with becky quick and andrew ross froggy sorkin. >> i'm losing my voice, folks.

>> you're picking your spots >> modulating. i don't think i'm sick. >> you're talking yourself into that this is what happens right before you get something really nasty. the futures are indicated down less than triple digits, less than triple digits, is it five out of six days we were up it's about 9% or 10% who thought up that christmas eve route. >> merry christmas, the grinch is here. >> the grinch was trading that day. anyway, take a look at yields

which are above 2.7. jeff vinik is reopening his fund, vinik asset management, after a six year hiatus. leslie picker has more on that story. good morning. >> good morning. a lot has change since the six years vinik was running his own hedge funds. he was using bottom up fundamental analysis since 2013 when he returned $6 billion to investors, the strategy of betting both for and against individual stocks has underperformed the market other legends like lee cooperman and richard perry have gotten out of the industry, opting to manage their own money instead. those who have been in the hedge fund limit the move from active to pass i, the rise of algorithmic trading and the fierce competition that's

cropped up chipping away at the alpha they used to enjoy that's what makes vinik's timing in relaunching his fund so interesting. he says he sees those forces as opportunities rather than obstacles and he believe this is suits his traditional investing style. >> i don't know how it feels to be spoken about while you're right there but jeff venn nick is right here. >> thank you for having me leslie, you couldn't have says it better i think this is an incredible opportunity for old-fashioned stock picking. we've had decades or maybe 10 or 20 years of active managers underperforming pass i managers money has poured in at the expensive active funds the amount of coverage on companies on wall street has decreased. these trends have kind of ignored the fundamentals behind companies, quantitative trading.

there's a great opportunity now. i've only known one way of investing for 35, 40 years and that's stock picking, roll up your sleeves, understand industries, talk to company managements and find good companies selling at reasonable valuations with great management teams. >> explain why now what was it about now? i assume you've been thinking about this for some time was there a lunch or meeting or conversation >> i wouldn't say that this took me about a month but when i got out of the market in 2013 i've still been very active and involved with my own account. i've been investing for the five or six years, i especially got active in 2018 it might sound crazy but during earnings season i look up the earnings and the results and the conditions every single company that reports earnings. i still do that and i'm not in business so i said to myself, of course, i love doing this, i miss doing this. let's go from the minor leagues which is running my own account

to the big leagues again, institutional money so i think the time is perfect. >> you mentioned quantitative trading. people say well, the collective psychology of the market has changed, because there are fewer stock pickers like yourself that the price discovery dynamics have changed in the markets. do you see that reversing? >> that's nonsense and when all the stocks in the market go up bays of program trading or algorithmic trade dog down, et cetera, at the end of the day if you look at companies, in my opinion they're driven by earnings prospects so whether they go down too much because of a sale program hit, that's an opportunity to buy them. a year from now, five years from now companies will sell at valuation based on that company's fundamentals, that's always been the case and

volatility is opportunity. >> i look back at the last ten years and think about this wave of money and liquidity that washed over. we talked with people like david tepper babbitt that. we talked to warren buffett and bill gates about the idea that when interest rates are so low there's nowhere else to put your money which is why stocks have been riding high do you think we're coming to an end of that period and you'll see value tillty in how things trade? i would say it's been a difficult time to find opportunities. places where a single stock outperforms when you have to tide lifting all boats >> i can't cite the names but i guarantee there were a dozen stocks up over 100% and a dozen stocks down 50%. it was because of that company's fund ales. >> i feel like you're going to have more opportunities going forward is my expectations >> there are opportunities today, that's what i'm looking at in terms of different asset classes doing well my belief is

that we're in a secular bull market it started in 2009 we're halfway through it driven by good economic growth. >> halfway through it? >> secular ten years in, that's my guess. >> a lot of people say you start a fund right now, if this is the eighth or ninth inning, tough time to do it. >> with good stock picking it can work in secular bull markets or bear markets. that can be a good thing for opportunities. secular bull market, we're nine years -- secular bull marketed started in 2019. there was a direction in 15/16 my guess is we'll go another couple years plus and minus. we will have bear markets in between, i don't know what will happen the next six month bus long term i'm optimistic. >> i think your timing is interesting.

last year steve cohen reentered the market he posted only 5% returns for the year i know you're not allowed to comment on the fund rates but yours is shipping up to be among the largest of 2019. how do you differentiate yourself from other managers in the market that failed to produce the returns they saw decades ago? >> i put blinders on and i always operated that way i don't pay attention. when i talk to other managers, sometimes they sound so smart they screw up my head. i like to stick to our meeting i'm seeing plenty of opportunities in the market. this is similar to when we were in business from 1996 to 2000. we were a small shop i was actively involved.

i'm the main analyst as well as the portfolio manager. i'll spend my days analyzing industries, picking good stocks and wibl that kind of effort and commitment and you said in the a press release, the fire in my belly still burns. i am ready to go. >> and not for the jeff vinik family trust. >> my family foundation is a major motivator here. >> why not just do them? why do opm >> when you have a higher profile with institutional money it will put me that much harder. number two, i can make more money for my family foundation that my wife and i can give away over the years if we do it -- >> i think a lot of people are like you

i don't expect druckenmiller -- he likes you but i don't see him coming back. >> i had a conversation with him a month ago and i missed it so much talk about what happens. >> you think in terms of size, it's helpful for the enemy >> i've said it's inversely related. as you get bigger it's harder to outperform but markets are big there's plenty of liquidity. cap is five times as much as it was when i started 20 years ago so i believe i can put up good numbers with the size of the assets >> any investments you just love right now? >>. >> honestly i think technology is in the middle of a 20-year run like the market is construction materials look interesting. a bunch of things. >> what about the business mo l

modeler mode er for hedge funds. the largest hedge funds are getting more diversified, fees, of course, have come down. are those concerning as you embark on relaunching your hedge funds? >> no, it's a little like back to the future. we are going to be -- this is me running investors' money and being focused on that. this is not about clipping coupons and management fees. this is about growing people's money long term. this is like the '90s. i don't want to -- i'm not -- i love this, i love being active in the market. i'm doing this to show what i can do. >> hockey and baseball doesn't do it for you? >> i don't even the red sox anymore. >> not even minority >> i sold it about a year ago. >> good timing i missed my fourth -- >> well, staib in first place. the lightning are doing great

and i love the lightning but if you look at what i'm doing in tampa bay, the lightning and our real estate company, everybody should move to tampa, if you look at the things i'm involved with, i have late great leadership. i'm focusing on this new portfolio. >> jeff vinik. we have more in just a little bit. thank you. retail shares under pressure we have stocks down sharply in the pre-market target had been doing well, it's down by 3.25% but check out macys. down 16% based on the guidance they've just given after they're telling us about their november and december sales i'll run you through these numbers and the chairman and ceo of macy's. kohl's under pressure based on the guidance it gave out looked like it was losing share to target so target down by almost 3.5% but it looks like the winner relative to macy's

and kohl's and round two with jeff vinik. he talks stocks and brings us a big market call. stay tuned, you are watching "squawk box" here on cnbc. this is huntsville, alabama. aka, rocket city, usa. this is a very difficult job. failure is not an option. more than half of employees across the country bring financial stress to work. if you're stressed out financially at home, you're going to be too worried to be able to do a good job. i want to be able to offer all of the benefits that keep them satisfied. it is the people that is really the only asset that you have. put your employees on a path to financial wellness with prudential. bring your challenges.

a business owner always goes beyond what people expect. that's why we built the nation's largest gig-speed network along with complete reliability. then went beyond. beyond clumsy dials-in's and pins. to one-touch conference calls. beyond traditional tv. to tv on any device. beyond low-res surveillance video. to crystal clear hd video monitoring from anywhere. gig-fueled apps that exceed expectations. comcast business. beyond fast. welcome back, everybody, macy's out with its holiday sales numbers and it's a big disappointment based on what the

street had been expecting and what the company had been telling people in ovember. at macy's company, the sales were up by 0.7%. sales plz r plus licensed store but when you look at what the company had been anticipating over time that will make a difference they said comparable sales were owned plus licensed would be up 2.3% in fact they were up by 2% also, the estimates of what they're expecting for full-year earnings, they see somewhere between $4 a share the street was at $4.23 because the company gave guy vance that would be 410 to 4030 so it's gon down to 26.37. also comments from jeff agagwint saying they had an incredibly

strong black friday but things fell off a cliff, not his words but they went down and didn't see a rebound until the last week before christmas. we have heard this from analysts and who said very strong start to that holiday shopping season. it was a long calendar time, most days you can have between thanksgiving and christmas and as a result you didn't see shoppers turning out in the middle of that time. also look at shares of kohl's there are under pressure kohl's raised its outlook but reported a deceleration in holiday sales growth that stock also getting hit hard down by almost 8.5% to 6403. and target saying holiday sales were up by 5.7% when you combine sales in the store and online. they said there was strong traffic and a slight uptick in

the average ticket price that would compare it to 3.4% they say digital sales were up by 29% and they also announced cfo kathy smith will be retiring after her successor is found still target shares are down by 3.8% even though it doesn't seem like there was too much that came as a surprise. >> macy 's . >> where is cramer, is he back >> i don't know. >> is he on today? >> we'll find out. >> he's talking about how this is part of -- he was hearing this stuff. >> the numbers you had been getting were backwards looking. >> he's talking about what the

fed doesn't do hopefully we'll talk to him about it. >> when we come back, trump versus the fed with the president unhappy with interest rate hikes we'll speak with one of congress's most ardent defenders. you're watching squawk right here on cnbc

we spoke to president trump at the white house in july and i asked him if the fed should be raising rates at the trajectory that was indicated back then and he had this to say. >> i've been a very good man in the fed, i don't necessarily agree with it because he's raising interest rates i don't necessarily agree with that. i must tell you, i don't i'm not thrilled because you know we go up and every time you go up they want to raise rates again and i am not happy about it but i'm letting them do what

they feel is best. >> not all republicans see the things the same way as the president when it comes to the fed. joining us now jerry moran senator, thank you for joining us this morning and i don't -- i think the president thinks the fed should be independent but i could make a case that a rules-based fed that john taylor has been talking about might not be a bad idea. there are just times where i wonder if one guy or one institution and in fact one individual normally can sway his colleagues because you know a lot of other fed members were more dovish. do you think the gut feeling of one individual that may or may not be totally up on the economic milieu, if you will, at any given time, that's the guy that can either put us into a recession or not are you comfortable with that? >> i'm not comfortable with one

guy or person being able to put us into a recession. when i talk about the independence of the federal reserve, maybe the federal reserve can be modified but the point is decisions need to be made based upon economic analysis, not an overfly of split cal influence or decision making, what's good in regard to the next election. we need short and long-term economic policy, particularly monetary policy that is based not on the whim of one person or how it affects the next election and therefore and i would hope the case is in the open markets committee that while a chairman can be influential, i've seen instances in the case of my own kansas city federal reserve board president in which there is independenceoutliers in speaking so i want to make sure the decisions are made and the fed has a dual goal.

neither one has to do with remembers or democrats, it has to do with full employment and control of inflation so, yes, it is important that decisions be made not at the whim of a person but the motivations can't be politics. >> let's say you have a president -- not necessarily donald trump-- who has tried hard through deregulation or through policy to get the economy growing more quickly than it has in a while and how do you know at that point whether -- if these job owning rates to stay low and there's no inflation, how do you know he's job owning for reelection or job owning to keep the fed -- to keep the economy growing and benefitting from all the fiscal things that the government is trying to do and you don't need a head wind that might cancel out all those hard-won efforts

that he made how do you know it's about reelection and not wanting the economy to grow? >> i think the case of rising interest rates today, that was highly predictable, the number of us complained about the past federal reserve board and their monetary policy, open markets committy policy knowing the day of reckoning had to come, monetary easing set the stage for the need for rising interest rates and the issue that the federal reserve has not just the idea of -- the idea of a growing economy but the necessity of preventing interest rates at a position in which they don't control inflation so while we talk about a growing economy, that's what i want i want more jobs, higher jobs, better paying jobs, but we know there's a consequence that comes to those people who have those jobs if inflation takes away their earning power. >> once that but also you see wage gains finally for people

and i'm sure you've argued either pro or con against the phillips curve analysis. if you have copper hitting lows and oil back in the 40s, you have jay powell deciding in his view that inflation will be a problem here in term he may be right, he may be wrong, some people think yes, some people think no and he's in a position to say we're way below normal when he's no better at anyone else knowing how low interest rates are so just to voc independence when some guy might be wrong in his assessment of the current situation, i'm not sure that helps either. >> the point i would make is the law indicates a chairman of the federal reserve board, a member of the federal reserve board can be removed for cause my point would be the cause can't be that we disagree with their upon tear policy over time, a president, the next

president, past presidents have the ability to i believe influenza who makes those decisions. we need to make certain that what you indicated in your opening comments that no one person, no chairman is uninfluenced by other factors, including the president. >> it kind of looks like the president was right. not for nothing but. >> i'm obviously support ifr of the administration's policies when its comes to regulatory reform and tax changes. >> maybe in spite of himself, real estate guy, low interest rates, who knows why, i'm not saying he's prescient or smarter than powell but at the time he was saying it -- >> we also know that political influence affects the market as well. >> senator, thank you, we appreciate it. i love kansas. thank you. coming up when we return we armiteawe nus ay from fresh economic data. when "squawk" returns.

welcome back to "squawk box," rick santelli here with breaking news. one of the few data points we ear still getting, initial jobless claims, 216,000 which is down 17,000 from a revised 233,000. originally reported at 231,000 how about perspective. to go back to september of 2018, we hit 202,000, the lowest since 1969, to give you a little gps

so we are only 14,000 away from testing that level that goes back to '69 and on continuing claims, a week in arrears, 1.7 to two million that comes down for a revised 1.75 and we're hovering above 20 in 10s, maybe 30s are percolate ago bit. curve is on precipice of minor steepening in the last 36 hours. 30--year-old bond yields over 3% and yields made a nice bounce off their find low yields, closing low yield 255, we started out last year at -- the year before we closed out 2017 at 241 there's a lot of wood down here. andrew, back to you. >> thank you steve liesman is with us crunching the numbers, what's

your stake >> we're trying to figure out the way the shutdown works through the claims numbers and i've been on the phone with the bls and claims department and i don't know that i understand it all. i know there's a separate category for federal workers filing unemployment benefits they get to file them. if they get back pay they have to refund the money. it does it with a one-week lag so unemployment claims released here it's only up by federal employees total 4,000 so an increase of 3800 so the first wave looks to have come through. then you have private contractors that do business with the government. they could also file for regular unemployment. >> they'll never -- those are the people who aren't getting paid contractors haven't been paid. >> and the federal government employees won't be paid as of tomorrow. >> saturday, i think. >> it's all complicated, you had

back in october, 2013, a spike of 50,000. it's just something the markets will have to look through or figure out how much it matters, right? tehe estimates we've seen from economists are 0.1% of gdp over several weeks if it lasts. >> we'll get the numbers or do we not have to worry about them because we won't see the numbers as long as there's a government shutdown. >> you tell me do you feel good putting a blindfold on driving a car i think the data is important. >> no, but are we going to get the numbers? >> i think -- which numbers, the economic numbers labor data we'll get because bls was funded commerce was not fully fund sod dea data won't come out. and i want to talk to the fed speech we have barkin, powell at 12:45.

>> where is powell speaking? >> janet yellen? >> just like the all americans, you don't care what you think about the economy. >> i think it's funny. >> so we have bullard coming up, powell, evans. kashkari is new and rich clarida. powell is speaking at washington at the economic club and what we heard yesterday is important the center of the fed has shifted. everybody is in this circle in the middle which is we're going to be patient and the only difference is some guys are leaning patient but i want to hike and patient i'm more thinking about a cut everybody was on the side of let's hike and i want to do it but now after the signal from the chairman i think also you saw more patience as well. >> the middle means do nothing.

>> that's right. neutral in central banking is a gear it's something you do when you don't do anything so they'll wait and clarify my opinion,rate hike off the table they could come back in march. he gave what was considered for the central bankers the fiestiest speech he said i see what's happening to the market -- the boston fed president. >> he said i think it's wrong, i think optimism will be the right call here. >> meaning the economy is doing well so we have to hike? >> right exactly. >> which is so weird because when you talk about optimism you're talking about people who want to hike rates which leads you back to people who say that will be bad. >> but if you have 2.5% growth and 2% inflation, that's 4.5% nominal, the underlying funds

rates being 2.5% is commensurate with how it was before the crisis. >> steve, thank you. >> pleasure. when we come back, more with jeff vinik, including a big market call from the hedge fund legend. plus, retail stocks getting killed today we'll break out holiday sales numbers that have been moving stocks macy's stock down 18%. stick around, you are watching "squawk box" on cnbc quadrupled their money by 2012? even now experts all across america predict the real gold rush is just beginning. u.s. money reserve is the only precious metals company led by a former director of the united states mint, and is one of the largest u.s. gold coin distributors in the country, u.s. money reserve has proudly served hundreds of thousands of clients worldwide. there may have never been a better time to start diversifying your assets with physical gold and silver, and right now, it's easy to get started.

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welcome back to "squawk box" everybody. we're watching retail stocks under pressure this morning. check out shares of macy's the company holiday sales rose less than expected and cut its guidance it was some of the details they talked about saying after a very strong start with black friday things fell not off a cliff but i would characterize it that way myself jeff gwinnett said numbers didn't come back until that last week before christmas and that's why you see that stock off so significant significantly. >> kohl's stock off by 8.5%. target suffering as well despite a 5.7% growth in holiday sales and check out l brands the company's victoria secret brand posting a 6% decline during the holiday period. that stock is down by 7.9%. >> shares of american airlines,

the carrier cutting its 2018 guidance below what the street was expecting and it says the key metric of revenue per available seat mile will come in at the low end of the forecast range so we'll keep an eye on shares of american irlines as wel well earlier we spoke with jeff vinik about his decision to reopen his fund after a six-year hiatus he's back now with a big market call jeff, thank you for coming back. we talked about how you were a bottom's up type of person when you looks at the market but your call is a topdown view of what's happening. >> i am a bottoms-up person fundamental analysis but i've used a top down blueprint based on sentiment in the market, the economy, the market activity, et cetera so i try to mix both. i never lost much money in any of the dow markets but i have thoughts about the very long term and i think economic

conditions in this country are good and likely to say that way secularly over the next 10, 15 years. inflation is low we have disruption that is on going. we have competition. wage inflation is ticking up a bit, you put that together when you look out ten years, that's a great environment for stocks there will be bear markets and corrections, maybe we're in the middle of one now but it's a good long-term outlook. >> for the long term you're taking a broad range over an extended extended period of time. but we were having a question about whether the fed was making a mistake by raising interest rates in december. could a policy mistake throw off what you've been expecting >> for the long term it will have no effect on that it may cause more volatility, ups and downs in the short term.

it's irrelevant. the fed said that'd be more dovish going forward second of all, kind of what happens what happens to some extent 25 basis points, did that make the difference >> did that make things look cheap to you if you're talking about 14 times forward earnings. >> that is what i was going to mention. the market is reasonably priced now, the best it's been in a while and i can tell you on december 24 the market looked cheap that day. >> i got excited just now when you talked about disruption and confirmed what i am hoping for that these great discoveries are coming quicker and quick er when computers and machine thinking suddenly outpaces human thinking it seems very deflationary to me which makes me think we could explain a new normal for where

interest rates are supposed to be that might take the phillips curve and grow it on its head. that great growth doesn't necessarily come with inflation. >> bull's-eye. >> really? >> i absolutely believe that i've said for five or ten years interest rates will stay low for longer than we believe doesn't mean the ten year won't go up to 4%. this disruption in innovation is very deflationary. consumer staples companies, that's a big part of the economy, they are under pressure because amazon is selling goods private label at lower prices so this on going deflation and disruption will continue we have tight labor in this country, tight wages in this country. i believe we are going to have a sustained period of higher wage growth we're about three years into -- the trend of lower-income people having less wage growth than

upper, we're three years into a change in trend there so it will take a while but the inequality which has been a major issue, it will get better. >> without inflation. >> without inflation. >> andrew has a doorman, you weren't worried about income inequality. >> you stole that line. >> i stole that from blankfein. >> you're right on with that, exactly. >> where are you on retail. >> you're so smart, jeff. >> very you on the retailly. not stocks but the industry. you made comments earlier. >> i'm bullish on the con souler loermg that's not to say that i'm necessarily bullish on individual retail stocks you have to be careful because amazon and others are hurting them big time. but if you look at the consumer over ten years, unlike ten years ago the consumer doesn't have too much debt. second wages are going up which

will be a big positive third oil prices are down. enough disruption i talk about this is more money in the consumers' pocket but it's tricky where to invest that because it's good for consumer spending but there's so much disruption you have i have to a professional picking the right ones >> given that bullish outlook on the economy -- >> long term next six, 12 months, i don't know. >> as you construct a portfolio, note net long? net shors? how do you construct a portfolio with that outlook? where are you bullish? where are you bearish? >>. >> i probably have a year or two horizon and i'm very much -- i don't try to predict the future. even though we are predicting the future and i have those beliefs strongly i don't try to predict the future short term. i watch the cards come out of the deck so if and when we're

back in business it will be conditions at that time that dictate how leveraged my portfolio is i can't predict that in advance. >> can i ask you back to retail and back to amazon and how things are changing from a broader level, we had steve schirripa in earlier, the former "the sopranos" actor selling tomato sauce he used to be going through the grocery stores but now he's doing it through amazon and he says that's the best he said grocery stores are like mob bosses and he could do much better through amazon. how do changes like that ripple through the retail industry? >> it's tremendous because now there are these alternative channels of description that -- there's unlimited competition anybody can sell on amazon but there's only a certain amount of

she feel space at supermarkets so it's great for the consumer, they see more products, it's tough for the -- well, the retailer, brick and mortars and a little tough for the companies because they have more competition. >> margins get decimated >> they'll be under margin pressure perhaps if there's something negative about my outlook, you have to be careful with companies because if wages are going up as part of the economic pie, that could come at the expense of corporate profits so companies will have to be focused on productivity boom. >> so many of your peers, thinking of the a in amazon, so many of your peers piled into faang so -- and there's been a huge downdraft, would you get in now? >> it's stock by stock and situation by situation 101% are

buys. >> when you look at that screen, i don't know if you saw -- >> hey. >> there you are when you look at that screen, how do you break that list down? >> i see companies -- you guys all see it faang stocks i think there's secular trends but they have different fund amount l fundamentals the market is trillions of dollars. i want to focus where i have conviction. >> what part of -- what percentage of vinik asset management will be quited to bitcoin. i'm helping andrew here. >> 1%? 0% equities. >> we have to stick with the current environment. how about pot stocks >> i won't say zero but my guess is there will be too much competition, margins will come down, nobody will make money.

>> you just said all these companies being disrupted you have to spend more on technology. >> yes the in terms of cloud hardware spending we are in a pause right now. we may see that with december quarter earnings it's affecting the hardware companies that sell to amazon and microsoft and others so, yes bullish tech long term but a little bumpiness right now. >> jeff, thank you for being here jeff vinik, asset management ceo. leslie picker, thank you for bringing him. we'll get out to jim but andrew and becky, tmz report nothing prenup. >> on mr. and mrs. bezos >> no, you and -- yes, this is about -- >> no comment. >> you're on the record as a no

comment. let's get to san francisco, jim cramer joins us now. jim, you do a lot of home work, that's why you sleep three hours a night so you had aed he's macs that sales were not as good? this is one of the things you were talking about with the fed at the time? >> no. i went to many of the suppliers of macy's. i put together that november wa bad and december was bad that's why i was so upset with the fed. if they made the calls to the suppliers, they would have realed there wreal realized there was a real down shift. i'm urging them to do the kind of work i do or go home. >> steve showed me something

interesting. i was just talking about rules based fed. i'm not sure what to do with the fed. >> maybe make some calls i use this thing it's incredible. you speak to people. they tell you what's really going on it's kind of a shocker i actually like it i don't use the big data because it ain't worth anything. >> the fed is very powerful and they can make or break the economy. >> yeah, they're very powerful when it comes to making or breaking the economy are they powerful when it comes to figure out the same store week to week like kb homes like i have no pau because you've got to talk to lumber people. how boring are they? my wife says you're the most boring guy in san francisco. they have models

i took that class. on the phillips curve. it was dynamite. that was a dynamite class. i aced it. i was magna. >> it just seems like we've never been in -- >> so strong. >> yeah. we've never been in a period where -- that's why the cingularty th machines are getting more and more powerful and i think a lot of the advances in medicine and how long we live and how healthy we stay. i'd hate to miss out on that >> there are things that are happening right now that youn ad i know when we look at the data we saw

this morning, it's why i was so worried that the fed was going to stick with the three plus the one because it was completely out of sync with what everybody who sells to these stores are saying. >> anyway, jim -- >> it's the marvin lewis model he had to go >> that's true you okay with this game coming up you're feeling -- >> it's the saints versus the sainted. st. nick versus the saints we have pl we are playing in their heaven

>> they beat ohio state. >> and it came down to the very last shot and we stopped their three-point shooter cj >> anything can happen. >> we still have our baseball team. >> yes, you do. >> in the end, trust the 27-year-olds who do the work put your faith in the 26-year-old interns. they're dynamite. >> jim, come back. are you coming back soon >> i don't know. i take the red eye on saturday because i hate the whole sleep thing out here >> thanks, jim we'll see you in a few minutes and later today don't miss an

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thomas barkin says he expects economic growth to continue but at a somewhat slower pace in the 1.9% range. trade and international economy and politics and the narrowing yield curve. retail stocks under pressure this morning check out macy's the company's holiday sales rose less than expected is that a misprint it's not it's down 18%. kohl's also reported a slowdown

in holiday sales growth. target suffering as well despite a 5.7% increase in holiday sales. check out l brands posted a 6% decline during the holiday period nordstrom is down almost 9%. >> that's what we heard from people like dana and other retail analysts who said, look, it slowed down significantly after a very strong start. the longest period in the calendar that you can possibly have between thanksgiving and christmas and people stopped shopping in the middle let's talk about ford. it said this morning it will cut thousands of jobs in europe as it tries to cancel production of loss making models ford had signalled the changes were coming in europe. ford said it would exit the multivan segment, stop

manufacturing automatic transmissions in bordeaux france and consolidate some operations in the u.k >> right now it's time for "squawk on the street. ♪ good thursday morning. welcome to "squawk on the street." jim kramer is still at market in san francisco. we miss him but what a week he's having carl's out this morning. let's give you a look at futures. you can see we are set up for a lower market open after what, of course, has been a strong week european markets have been open pr so for some time. let's check in there and see how things loo