this is a special presentation of "squawk box. live from the world economic forum in davos, switzerland. good morning, everybody. welcome to "squawk box" here on cnbc we are live from the world economic forum in davos. i'm becky quick along with joe kernan and andrew ross sorkin. take a look at the u.s. equity futures at this hour they are indicated higher, but not by enough to wipe out the loss that is we saw yesterday. big concerns yesterday about what will happen between the united states and china with

those trade talks. we're going to bach about that and the economy around the globe. in the meantime, take a look at what happened in asia overnight. nikkei was slightly lower. it was down by over .1%. the hang seng was flat, and so was the shanghai composite if you take a look at what's been hang at some of the european markets in early trading today. early things that are taking place at this hour you are going to see that at least right now in some of that early trading a little bit of a mixed picture. slight declines for the ftse and for the dax. the cac in france up by just a little bit less than .2%. ftse -- the ftse mib in italy is flat, and then in spain the ibex 35 up. you are going to see that with everything that's been considered, central banks around the globe with these lowering forecasts by the imf for global growth, you'll see the ten-year yielding 7.9%. china remains front and center for the markets the dow, of course, tumbling early in the dayon reports tha the white house had canceled a

trade meeting with china those talks were reportedly set for later this week. >> with respect, the story is not true right at the top. >> we will monitor the comments and bring you more >> dicey there, indeed that's pretty interesting to come out and unequivocally start for our old pal.

solid growth from cloud services business revenues missed in the quarter it was a tough comp given some of what they bought the last year down a little bit after the company had celebrated the first revenue -- rising revenue in a while. the company did say that 2019 earnings are expected to be above expectations, and that is what called the shots there. it was up 6.25%. you can see there at 130 or so we -- try as we might, she wouldn't tell us what the earnings were going to be either on camera or off td ameritrade's profit doubled. that topped estimates. they cited market volatility in

the fast few months as well as its acquisition of scott trade the revenue fell just short of forecast, although profit -- the company is also buying roughly $9 billion of wal-mart's credit card balances from synchrony financial. the market will get more earnings reports coming up in just under an hour's time. this morning we're going to be hearing from dow components. procter & bam bell and united technologies then at 7:00 a.m. eastern, we are expecting to hear from comcast. the parent company of this network. it's expected to release its quarterly results as well, and we will bring all of those numbers as quickly as they're released, as soon as they hit the wires. cnbc will have complete coverage of that report on the closing bell that's coming up after the markets close. ceos convening here in davos, and they've been sharing their biggest concerns from 2019, the world economic forum even teamed up with insurance and risk management firm larson to issue a report on the biggest global risks this year joining us right now is dan

glazer, the ceo. thank you for being here >> it's great to be here >> it feels like there's a lot of hand ringing going on this year a lot of anxiety about what's to come in 2019 and 2020. we had a number of guests yesterday, including ray dalio, who suggested there was a recession headed our way come 2020 >> year after year the feeling here sometimes ends up being the opposite by the end of the year. >> well, there's a huge proximity bias here, right what happens over the previous couple of months is front and center what a difference a year makes last year, you know, confidence was back there was a lot of ceo optimism. a sense of the long aftermath of the slow groit financial crisis had finally drawn to an end and good times were ahead. this year filled with

uncertainty, levels of concern, and you can pick your poison it starts probably at the top with a general economic feeling as whether there's a slowdown. i think more attention to the u.s. china rivalry everybody knew china and the u.s. were rivals just not capital r rivals. you think about other subjects that are being talked about here brexit i mean, certainly one of them. most of the chatter is around what could go wrong as opposed to what is -- >> take us inside the boardroom, though, in temgz of companies that were thinking about capital expenditures, big investment that is they plan to make on their business how many of them are saying you actually, you know what, we're thinking of doing x, but we're actually just going to hold off because we don't know what's happening? >> i don't think there's much hunkering down right now ultimately ceos do what ceos do. we try to look to the future we try to guess the outcomes, and we listen to experts all over the world >> guess the outcome what is the outcome?

>> the outcome is eventually we're going to have a recession, whether it happens in 2020, 2021, or 2022. it's eventually. >> ultimately, let's remember there's no better time to be alive. this is the greatest time in human history. there is more opportunity than threat. is the insurance industry set up for 2.5%

>> the insurance business is a terrific business overall. i look at it, and i say there's very few businesses that actually are geared for societial benefit of not only protection, but enablement maybe we sell ourselves as an industry a little bit too much about all about protection, but the reality is there is no investment without insurance. insurance companies are better than managing underwriting risks than they have been in the past. >> you can't get the risk for the rate of return that you used to be able to get. tlas good for my clients, but when i look at insurance companies, it's a tough place in

it the market for capital providers. the value advisory -- >> let me turn around. are there businesses that are coming to you now asking for different types of insurance to insure different eventualities. >> absolutely. first of all, the age of risk has just begun you take an area like cyber. nobody bought cyber insurance ten years ago, and now it's the fastest growing insurance product around the world particularly in the united states i mean, right now about 80%, 58% of the cyber market is u.s >> what are the premium on that? >> well, the premiums are probably too low there will be a function of losses as there are more cyber losses then cyber premiums will rise. >> is the risk asymmetric and really more to the consumer or more to the company. you know, we just had marriott

on, for example, right are they paying insurance to you? >> well, that's the fear >> it won't be an asbestos it won't be a latenciy, but there could be a cyber hurricane where there's cyber event that impacts many companies at the same time. >> all of a sudden we realize what's going on. >> then the insurance companies get worried about those. >> cyber scenarios, i think. >> cyber tsunami >> it begins -- cyber hurricanes working or not >> it's probably better. >> cyber sorkin. >> cyber sorkin. >> outside of cyber insurance, what's another kind of new market that's popping up, something that boards of directors care about these days? >> boards of directors always start with dno, right?

most companies buy physical damage and casualties, liability types of insurance every year, but some of when they're looking at risk, the conversations are more about risk than insurance, and it's really about what is ai impact on the work force, what's the impact of advances in broader technology >> those aren't things that people are buying insurance on >> no, but actually, we're in the boardroom talking about risk insurance is only a partial solution the companies are going to live with these risks work force of the future, big risk impact of ai, big risk coming up, it's not exactly true, because we got started last hour. >> we did. >> with coke we aren't really just getting started. that's false >> look at everything we have ahead of us. >> that's true, and how great

everything is going to be. we were here for an extra hour today. >> we could move here. well, we could move here now there's no issue anymore it's totally different we're getting started with our big line-up. do you ever call them the uber uber ceo like an uber ceo is like a great ceo. >> say it twice because he is an uber ceo of uber, anyway om o, the ceo, another uber ceo fril giant chevron, which is a dow component. his thoughts we're at 53 today, which is better than it was

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we'll give you a automatic twenty dollar credit. my name is antonio and i'm a technician at comcast. we're working to make things simple, easy and awesome. zbliefrmt crude prices tumbled on thursday in terms of slowing growth, but the commodity has now tumbled over 20% in the past three months for more let's welcome michael worth, chevron chairman and ceo. thanks for joining us in davos this morning if you could wish and it would come true, what's the perfect level for -- we'll talk, i guess, wti since that's what

we've been talking about where would you like it to be? we're probably not that far from that kind of a price right now >> are we good enough to get it out of the ground where it's a profitable venture for almost everyone at 53, or not quite >> i think brint in the 60s, wti in the -- it's there where the industry can be profitable that may not have been true a few years ago, but as we've gone through the last down cycle, people become more efficient, we are finding new ways to use technology, and we can make it work in that kind of a range >> we had discussions yesterday about what technology advances

in exploration in developing -- to me it means finding more oil, finding more harder carbons. the other people, i mean, on the far extreme take one and leave it in the ground, and have solar and wind power everything that's obviously not feasible at this point economically or for anything else. how do you view technology cleaner? easier to get it out of the ground? big data and some of the tools that that enables has really come to fore we're beginning to apply those things to operate more safely, say, protect the environment, to be more efficient and take costs out of the system and to be more productive a big part of the story in the permen basin has been moving

from the early days of almost brute force trial and error by the earrarly frackers to really bring technology to bear to become more efficient, to get more productivity out of the drilling, and so it's a tremendous story about technology >> what about exploration itself it's not the crap shoot it used to be, right >> subsalt you hear a lot of talk brazil topic in davos this week looking through the salt to try to image the reservoirs beneath that, it was like looking through a fogged up glass pane the technologies, we have not been able to see through that much better. we can process massive quantities of seismic data much more rapidly with much more precision than we could before all of these things are part of taking risk out of the business and proving efficiency and productivity and i mentioned earlier the industry can operate in this kind of price level now. a big part of that is because technology has made it more profitable >> i'm sure you saw a couple of weeks ago, alan greenspan, ben

bernanke, janet yellin, and a number of others, actually, came out in favor of a carbon tax i don't know if you saw that with the idea of giving the money back to taxpayers. i know joe is shaking his head >> you read -- i sent you the jacobs piece right, andrew? did you get it and read? >> i saw it and read it. holeman always makes you think i wanted to get your take on that assessment. >> well, you know, there are many people that believe that a price on carbon is the way to try to attack the climate issue. the other thing that's been a feature is a stated intent to clean out all the existing

lessee efficient regulation that has grown up >> which is part of their idea >> part of their idea was effectively move the regulation, make -- try to create some kind of market based system on top of it >> you know what it came from, right? you heard -- >> i have. >> higher energy prices. higher gas prices. >> from the carbon tax purely from the carbon tax let me ask you something else. you saw norway, and actually, here we're hearing the cars -- there are some people that think that in three years we're going to be able to make the transition to electric cars. i don't know what you think the eventual time that it takes where we're up to 50% electric i don't even know what that is in norway the leftist government decided that they're going to produce no more hydrocarbons unfortunately, they're one of the biggest providers of energy to people that get really cold up where the neighbors around norway, and i don't think that's going to work either, is it? i mean, the way these things collide, the -- what you would like to do and the realities of

the world a lot of times it's not possible when do you see something like all electric fleets? >> well, electric vehicles have made great inroads from a very small base >> it's still small, though, isn't it half a percent >> there are, i think, three million electric vehicles in a world of over a billion vehicles today. >> how many? >> a billion >> how many total electric >> three million the vehicle fleet takes time to turnover even as you see increasing rates -- >> don't -- >> unbelievable. >> you think it's going to be next year. >> i don't think it's going to be >> we're decades away. decades away mike should still do what he is doing. >> he is investing in all sorts of new technologies away from hydrochemicals >> part of the energy -- >> for decades to come >> five decades? ten? will my children -- >> any forecast says for many decades to come. >> you like flying in jets, right, andrew? >> will be part of the mix

that gets to an interesting point, joe people look at electric vehicles, and if you live in california where i do, you would think it's all going to happen tomorrow only about one-quarter of a barrel of oil ends up in passenger vehicles three-quarters ends up in airplane, ships, petro-chpz. demand for all of these things is growing not long, though, i was in a meeting with dennis from boeing who really cited interesting statistics he said 82% of the people on the planet have never been on an airplane their models say that over the next 20 years -- >> it's only going to grow >> 100 million people will get on an airplane for the first time each year >> people are -- a lot of people aren't warm. >> the demand for a better life, which the meerjing economies are seeking -- > he slowdown in the

economy, do you worry about the perspective of somebody whose fortunes rise and fall with demand >> we do at the margin, small changes can take the market into or out of balance. what we see around the world, and we sell our products into a number of sectors that historically have been pretty good indicators of economic activity, so construction, mining, transports we saw lubricants and lubricant additives into industrial applications we're not seeing signs that we're hitting any kind of a wall things may have slowed down a little bit in certain parts of the world, but -- >> one more thing, then we have to go. do you think in our lifetime we hit peak oil, or do you think it's -- i just saw another

billion barrels equivalent we supposedly hit it in 2012 i remember that. i know you -- they were forecast back then. do you think we ever hit peak oil? >> in terms of peak demand, i think, yes >> no, in terms of where the supplies that are left start going down we keep -- >> we'll transition to other things before we hit peak oil. as you reach that point, the price signal will arrive, and other technologies that may not be as competitive and economic today, i think, will be. we'll never run out of oil >> thank you michael worth, thank you >> good to see you >> chevron chairman and ceo. >> when we come back, a conversation with bill gates the microsoft co-founder or microsoft founder on the push for innovations and the battle against diseases coming up with the next new vaccine to save millions of lives. sqhterafr isn teth o ""uawk box." sfx: [phone ringing]

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?

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>> earlier this morning i spoke to co-founder bill gates we talked about the $10 billion investment that the bill and melinda gates foundation have contributed to vaccinations and how that return on investment outpaces all expectations. >> as we look at upcoming replenishments for those and we've got so much distractions politically that the international needs like this could get eclipsed if we're not careful, and we see a phenomenal track record there's been over a 20-1 return. if you just look at the economic

benefits, that's a pretty strong number compared to anything else the human benefit in millions of lives saved. you know, we're here with a pretty strong message that although all these other issues are very important, let's not forget about the great success in global health and maintaining that commitment. >> i think the numbers that you ran through were if you had put that money into an s&p 500 and reinvested the dividends, you would come up with something, like, $17 billion. you think it's $200 billion. >> here, yeah. helping young children live get the right nutrition, contribute to their countries, that has a payback that goes beyond any typical financial return.

>> people forget if you get a disease down to small numbers. they back off and think, gosh, i heard some rumor, you know, maybe i'll just avoid doing it the chance their kids, say, dying of measles is pretty low, but as you accumulate more and more people saying that for whatever reason, eventually then measles does show up, kids get sick, and sometimes they die in rich countries, the numbers aren't yet very large compared to the literally 300,000 kids worldwide will die of measles. very little of that is in these countries. the trend is not a good one.

>> has recommitted to doing that, despite the turmoil. the u.k. is the biggest donor to the vaccine work their aid budget has actually gone up, and the prime minister has been a big supporter of that in our dialogue they're not saying -- we do worry about it you know, concretely, the kpiktive branch and the u.s. wanted a cut, but the congress on a very strong bipartisan basis said, no, they're not going to cut these programs. >> if that goes on, just for

managing the money that's being spent, you end up doing that very inefficiently >> guys, despite what you hear about how much philanthropy does in terms of donating to causes like this, bill and melinda gates foundation spending $10 billion over 20 years. that's just 10% of what the world pulled into this worldwide it was $100 billion. they need the governments spending on these issues to make sure the problems oversooers don't go back on to the shores of the developed nations too >> i know that matt is here, again, this year str >> we're going to be seeing him tomorrow morning and bringing us more on that interview >> talk water. >> yeah. >> you can't come to the set >> i know. we're going to talk about that, too. >> why >> it's a credentials issue where. >> what? >> you think matt damon would bible able to get the credentials. >> do you know how many water wells that saves in villages >> how did we get credentials? >> a lot more to come on "squawk

box. we're going to be talking about protecting your data networks talk to us about the biggest threats around the globe. that stock has been on the rebound during a roughened later, you don't want to miss this j pr morgan jamon one of the big names coming up over the next couple of hrs ua rur in just a moment. will it feel like the wheend of a journey?p working, or the beginning of something even better? when you prepare for retirement with pacific life, you can create a lifelong income... so you have the freedom to keep doing whatever is most meaningful to you. a reliable income that lets you retire, without retiring from life. that's the power of pacific. ask your financial professional about pacific life today.

welcome back to "squawk box" from davos, switzerland. u.s. equity futures at this hour are getting back some of yesterday's pretty steep losses. not as bad as, obviously, the middle of the session, but this morning we're looking at a rebound of about 85 points on the dow. 5.5 or so on the s&p nasdaq indicated up 14 14 and change. >> data privacy. concerns still a major issue in 2019 in fact, research firm gartner predicts global spending on data security will exceed $124 billion this year. putting palo alto networks in an interesting position joining us right now in his first major interview since taking the helm to palo alto since his interview with jim yam cramer on his second day on the job is chief executive nikash. it's great to see you.

>> thank you for having me >> there is a huge bull case and a huge bear case on palo alto network out there, but one thing for sure is that the street expects that you are going to be earning more money than it did 60 days ago. while everybody else's numbers keep getting taken down, analyst expectations for your company keep getting racheted higher why is that? what's happening what are you seeing? >> well, we're not going to talk about the next quarter since we're working hard towards delivering it, but i think what's interesting is i've spent the last day and a half at davos, and everybody is talking about the digital transformation, the fourth industrial revolution. the next word that comes out of their mind is trust. there's going to be no transformation without trust there's going to be no trust without security every time you read the front page of "the journal" or watch people on cnbc, talking about the next data breach, you take one notch away from the trust that people have

i think we're in a positive secular trend that people are going to have to pay attention to security for a while. >> we referred to the gartner numbers and the growth that's expected in the industry i think it's something like 12% or what they estimated happened for 2018 for a long time you've been outpacing industry growth, though are you continuing to take market share >> i love how you want to keep dragging me back to what's going to happen. look, there is a secular trend we have superior products. we do a really good job in working with our customers and securing them and customers prefer us. we're very, very happy with the products we're making. >> the products we have or at least the technology we have ultimately getting built into what's called a stack by the providers, and imauto talking abo

about. >> everything -- i heard the next media company as well we should all just go and relax and do everything. i don't think they're going to do this. look, first and foremost, if you talk to the customers out there, they want to be hybrid cloud, multi-cloud. very few customers are saying i'm putting all my eggs in one basket yes, will google do a great job of securing their infrastructure yes. will microsoft do a great job of securing infrastructure? yes. they're not going to do anything that's going to help you in a cross-platform basis that's one problem they're not going to solve that. we're going to help solve it the other thing they're not going to do anything about is this notion of shared responsibility says. they protect the infrastructure. how you protect what you do inside is your problem it's like you buy a house. it comes with a door and security alarm, but then you have to figure out to lock the door when you leave. >> they're increasingly trying to provide services to create the lock for their customers >> they have security hubs and security centers where they allow third party cyber security vendors to be present, and we are big partners, all three of them, where we do a lot of selling with them. also, there's a notion of this

multi-cloud cross-platform, things that you have to have you have to be able to correlate that with what they're doing on premise. we think we'll be fine >> the bear case on wall street, some people will say you didn't know anything about cyber security before you got into this, but you didn't know anything about ad sales before you started in google back in 2004 i just wonder what have you learned about cyber security in the last seven months that you have been on the job, and how have your views changed over that time? >> i keep changing my views, but for now the current state of affairs is that it's a bit messed up. i think we have not spent enough time thinking about it as we built infrastructure and companies, and it's very hard to go pivot that on one day and a let me go fix it it's going to take us a while to get things totally secure as we want them. i think that's one part of the problem. the other part of the problem is that people are security just to worry about i.t. you always have vendors not get price gauged by one or have two different people the problem is our system don't talk to other security vendor systems. they're not supposed to.

if they did, they would talk to the bad guys we have to make sure that people start looking at it as a platform play. we have platforms, but you tell customers you are better off getting the whole platform as opposed to trying to piecemeal the best of breed. that's a big change coming in the industry the their big change is coming, and that's we're going to have to do a lot more automation on this stuff you want the cyber attack to be stopped midflight. today it takes between 150 days for a company to find out that somebody has been lurking in the infrastructure >> really? >> yes >> you could get that down to what, you think? >> you have to able to stop it as it's happening. it's taking the data and gone. >> given that we have so many executives and policymakers that watch this program, what is the biggest surprise in terms of hole in the security systems that you have seen either from an industry perspective or a place where you went, wow, i really didn't appreciate that that is actually as insecure as it is. >> there's two people you don't want to hear from is your security company or your insurance guy. usually that means you're in trouble. something is broken.

something is bad i think a lot of boards have not paid attention to the topic. they have some risk manager or security officer, and they're looking him in the eye and say are we secure? we think we're best of breed that's good enough for me. honestly, we go look at the infrastructure out there, on average a company has between 25 to 40 cyber security vendors i don't know how you keep yourself secure, but 40 different vendors in the infrastructure >> we just heard from the ceo of marcia mcclenan earlier this morning. he said that the biggest demand they're seeing for new insurance needs from boards is for cyber security >> i was in a panel with the alliance ceo that said there's not enough data out there to be able to price it right >> is this something like the cheapest insurance ever offered, or are you facing some sort of asbestos tsunami where you find out what the after-effects are down the road? >> i think there is a normalization that's going to happen over the next few years, as people get more and more sort of tied to this notion of technology enabling everything >> are you surprised that given all the security holes we keep

hearing about and breeches that there hasn't been more actual damage meaning, you often hear about the huge headlines, hundreds of millions of people's identity has been stolen. you rarely hear about stories where there's been true damage on an individual level at least on a large scale basis >> i was on the same panel i think the secretary general of interpol said this is a $6 trillion cyber crime industry. you don't hear about it. i know we in a specific instance we shared threat data with one of the government agencies, and we were able to stop a $20 billion scam it's out there we're just not talking about it. if you look at all the companies, you're seeing headlines for how much after the breaches did you find out they had been breached. look at the last five. i'm not going to name companies, but look at the last five. it took us a long time to find out they've been breached and data had been gone >> thank you very much >> thank you for having me >> a lot more to come here in davos, switzerland

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welcome back to ""squawk box."" the flights into newark liberty airport were disrupted last night. that was due to a pair of drones the faa telling nbc news the drones were spotted near neighboring teeterboro airport all flights into newark were suspended. of course, this was a problem that happened in the u.k. twice just in the past couple of months i imagine they continue to be a problem in other places around the world. coming up, will the government shutdown disrupt the flow of ipos coming to the market one of the big topics that we're going to talk about with nasdaq ceo adena friedman that's next. at&t provides edge-to-edge intelligence, covering virtually every part of your manufacturing business. & so this won't happen.

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♪ the partial government shutdown is wearing on raising concern about unicorns plans to go public. in a linkedin post this week, the nasdaq ceo asserts the ipo schedule for 2019 remain unhindered you like when people talk about you when you're sitting right there? it's weird, isn't it adena friedman, nasdaq ceo, joins us now can we hear it from you? thanks for being here. >> absolutely. it's first important to start out with who was 2018. we had in the united states 259 ipos 186 of them came to the nasdaq and if you look at the number of listing applications we had on

file starting last year, we have a 35% increase of nasdaq companies who want to come to nasdaq at the start of this year so you have a really great growing pipeline and a very strong pipeline of companies from all industries, all sizes looking to tap the public markets. yes, the first month has been a challenge with the government being closed, but we continue to see really every company looking just to tap the public markets as soon as they reopen >> everybody is whispering that this government shutdown will delay these things >> i certainly would say there has been a delay so far. so we have a very important relationship with the s.e.c. they do real work to evaluate these companies, make sure the disclosures are accurate and complete then we do our work to evaluate them according to other listing standards. if they can't do their work, it's hard for us to complete ours however, with the hope the government does reopen in the coming days, weeks, then i think we'll see there is certainly less of a time window for these

companies to go. but they're ready to go. >> we heard from rubenstein about that yesterday, hearing whisperings about it but there's competing -- >> well, that's why -- >> neither of which have 60 votes in the senate. >> we all have to hope this is within days. >> there's no reason to think that either plan has 60 votes though >> which begs the question if this does extend out even several more weeks, at what point does this become a hockey stick in terms of a problem for the economy, for your business, for the ipo market, for all the knock-on effects >> the first thing i would say is obviously having a government shutdown with all these people not working is just not good for them and not good for the country. but i also think that as you look at it, if it does extend for weeks, then you're talking about more and more companies wanting to go public in a shorter and shorter window we still have almost the entire year and we are very excited. because they are readying themselves they are putting themselves in

motion so when the window opens, they'll be ready to go. >> the bigger issue for companies wanting to go public, assuming that you actually do see a solution to the government shutdown would be the volatility we've seen in the markets in the fourth quarter and the prospect of a global slowdown maybe the slowdown makes them want to get there faster >> going into the fourth quarter, we had all these companies that were ready to go and wanted to the tap the public markets. and they did slow down some of those plans with the volatility in the market. but the companies that did go out did fine and so if you're a strong company with a strong story and strong financials, you'll be able to get out even in a more volatile environment i think the volatility has calmed down a bit as we got into 2019 so it does feel like a receptive environment if we can get the companies to come to the market. >> i'm curious whether there's been a governance shift in the companies planning to go public. you know, there was such a push for so long.

dual class shares, ceos who had effectively total control. we've seen that trend and a backlash against that trend. what do you see when, in fact, the companies do go public. >> the vast majority do not go public with a dual class structure. some look at this and say i want to maintain a long-term outlook for the company. i want to have that level of control in terms of me being able to execute in my long-term plan we do support dual classes i think i look at it this way. we're very practical 37 so we would like more companies to tap the public markets we believe it's good for the country, good for the economy to have more in the public markets. if we look at the practicality, it's better than them staying private and having investors not doing investment at all. our view, it's just a pragmatic one. >> excited about this year

you are, right volatility helps everybody's talking about -- oh, we got to go but it should be interesting >> it should be an interesting year >> for anyone in this business and you know about the nasdaq. we broadcast from there. >> we do that's why it's fun to see you here >> see you back home >> thank you very much when i first came to ocean bay, what i saw was despair. i knew something had to be done. hurricane sandy really woke people up, to showing that we need to invest in this community. i knew having the right partner we could turn this place around. it was only one bank that could finance a project this difficult and this large, and that was citi. preserving affordable housing preserves communities. so we are doing their kitchens and their flooring and their lobbies and the grounds. and the beautification of their homes, giving them pride in where they live, will make this a thriving community once again.

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♪ ♪ our new, hot, fresh breakfast will get you the readiest. (buzzer sound) holiday inn express. be the readiest. another big day in davos >> you really need a price that encourages investment and draws in enough new investment but is not so high that it weighs on

the economy. >> the world's leaders gathering to discuss the issues affecting your money and this hour we'll hear from the ceos of coke, cisco, dell, and anheuser-busch inbev and comcast reporting quarterly results. the numbers and reaction from the street straight ahead as the second hour of "squawk box" begins rieg t now. this a special presentation of "squawk box" live from the world economic forum in davos, switzerland. welcome back to "squawk box" here on cnbc i'm andrew ross sorkin along with becky quick and joe kernen. want to show you the futures at this hour. about 131 points higher right about now. nasdaq would open 32 points higher want to get over to joe who's

looking at those comcast earnin earnings >> and you can see it on the screen comcast just out with numbers. the nbc universal, cnbc parent earning 64 cents a share in the fourth quarter that was 2 cents above expectations revenue was also above street forecast the company also announced a 10% dividend increase. cable customer relationships increased by a net 285,000 during the quarter with internet net additions amounting to 351,000. comcast also closed the acquisition of europe's sky during the quarter adding 164,000 customers from that transaction. and so far you can see the company is rebounding from a pretty sharp drop yesterday. up 1 1/3%. >> you look through the numbers, they beat the expectations on

most metrics looking atted adjusted earningsr share. when you're looking at ebitda for all of those same consolidated and sky it's interesting to note if you look at the year ago results, they were impacted had a big gain from the tax changes that went into impact. adjusted eps up by 36.2% if you take out the tax reform legislation. that's 2 cents better than the street was expecting too >> this is the first look at some of the results from sky wish were pretty solid in terms of revenue gains and everything else i need to talk to -- i'm not sure i talked to roberts about sky's programming in davos because i'm back to -- i got nothing to watch here. >> you have some old nbc properties to watch. >> but soon enough you'll be watching all of the nbc properties, the cnbc properties, all of it. >> that's what i need. if i see, you know, jerry orbach one more time -- >> that's also a cnbc show

>> i'm not putting it down i watch it but i want a little variety is all. >> an important number is the video customer losses. a year ago for the quarter it was 33,000 now just losses of 29,000. that's better than the street had been anticipating. >> high speed internet, the adds we see every quarter, is that going to be every quarter? >> they added 1.4 million for the year for 2018. >> could you look at the mobile numbers? comcast has over 1.2 million mobile customers now >> and the additions were 227,000 for the quarter. >> i'd keep an eye on that number >> i mean, it's hard to be objective because some of these results are so amazing >> as an employee but also a shareholder. but yeah looking through, if you're -- >> hard to stay even keeled about it >> you can get excited about some of these numbers. as you mentioned, the first time they're breaking out sky total customer relationships up by 164,000 there reflects growth in every one of

the markets. >> that's exactly what it lost yesterday. >> i mean, obviously the markets went down broadly. >> it normally doesn't with some of the market routes i was surprised. it was right into -- but there were earnings coming out today. >> maybe people were nervous about that this will put some concerns to rest let's talk about some other headlines hitting at this hour ibm shares jumping after ibm reported quarterly profit of $4.87 a share. that's 5 cents better than the street was expecting ibm also gave an upbeat outlook for 2019 as a result, that stock's been up sharply you're talking a gain of almost 7% this morning. $8.50 higher at $131 let's dig through some of this united tech with $1.95 a share had called for earnings of just $1.53 a share. if we could look at those shares

too. another dow component up by 3.75% this morning right now it looks like the s&p futures are indicated up eight points that is stronger than where we were this morning. >> a hundred is ibm and utx though lso, we have the latest quarterly numbers from procter & gamble consumer products giant earning $1.25 for the latest quarter that is 4 cents above what the street was expecting revenue also in above forecast and that stock up by about 1.2%. few other stocks on the move to tell you about this morning capital one at the top of the list reporting an adjusted quarterly profit of $2 per share. missed estimates of $2.37. the bank's revenue also missed forecast and johnson & johnson, they are looking to take auris health looking to pay a premium that emerged from the latest auris

funding round. as you know, we are live at the world economic forum in davos with some leaders of the world's biggest companies literally including coca-cola, ceo james quincey. he spoke with us earlier about the global economy as well as the soft drink business. >> i think there's a difference between a downturn and less growth i think we're in the phase of 2019 where we're likely to see a little less growth, or a little less tail wind i'm not sure i'd say it's a head wind but it is going to be a slightly tougher year than 2018 in mac macroeconomic terms. i think we need to work our way through it i think the commodity increase has largely happened although there are cost pressures out there. soing it's a little less tail wind rather than a new head wind i feel a degree of certainty out there you can't put your finger on i think it's making -- >> is that a certainty everywhere for you or are you thinking of a specific part of the globe where it's going to be harder hit?

>> no. i think the uncertainty is actually kind of global rather than one region. and in the modern global economy, something that goes wrong in a major piece here transmits itself around the world. so i think there's been a lot of volatility in some of the developing countries over the last few years and so we see that continuing. but i think just a little cloud of uncertainty over the growth forecast i think we all hope that they will focus on making the trade terms better rather than walking back i mean, no trade deal out there in the world was perfect they can all be improved let's hope that's where the agenda ends up for us, the effect is ultimately slightly indirect because the coke business is global and local. in any part of the world, 90% of what you drink was made in that country. all the cokes in china are made in china and all the cokes in the u.s. are made in the u.s >> the other interesting thing we talked about with quincey was

this consumer taste changing to vapidly. they' they're also trying to get rid of what they call zombie brands. 125 that they've identified just in the middle east and africa. those are brands that are really not up to snuff, aren't making the speed. so they're constantly cycling through this and trying to change the lineup. >> they're still there, but they're basically dead zombies. hence the name >> but he's really picked up steam in terms of shifting the portfolio balance. and a lot of investors were pushing them to do this kind of thing. >> that was my point you can only add so many fad millennial niche, i don't know, whatever happens to be envogue they're never going to be huge you add them up or try to stay huge >> that's the conundrum. to be huge, you're going to have to be niche because it's no -- >> no longer a centralized market >> this is like the media business everybody has their own specific

interest in there. i don't know if it's millennials in this or that. but in the coffee business against the starbucks piece which was aligned with pepsi you know >> when i talked about how we drink a lot of a certain brand of flavored seltzer and it's not owned by coke, they have that brand but they have the shelf space where i happen to go and there's none of the coke products i would drink a flavored seltzer made by coke, but it's going to take advertising, shelf space. if it's so fragmented, how do you get shelf space? >> you have to get big >> the branding thing is the big one. because you can't -- there's a margin issue which is if you're going to -- historically, spent a lot of money on one brand or two brands >> see, you i know how to market i would do some kind of social virtuous thing the bottles obviously --

>> with you, glass in a bag. >> can't hurt. it's fine for you, right some social, extra pair of eyeglasses i don't know remember >> you could give some water away to somebody else? >> yeah. a matt damon >> how would you feel about that maybe matt damon and i will go into business with that. we'll call quincey and get this going. >> supposedly he's here. >> he's here i saw him last night >> quincey is doing a great job of changing the portfolio. >> i didn't see him last night >> you were at the wrong party >> that's what i mean. when we come back, the ceo of palantir. check out the lineup we have for the rest of this hour. chuck robbins will join us shortly. then booze news you can use, anheuser-busch inbev's ceo will be our kguest. quk x"ive to come right here on "sawbo le from the world economic forum in davos,

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alex karp, the ceo of palantir companies. the company that provides data and software services for the u.s. government and other corporations around the world. many expect palantir to be one of the largest ipos of 2019. i started off by asking him about the government shutdown. >> i think for me personally and for most people at palantir, we're kind of a super global business and it's damaging for the american brand to have something from the outside doesn't seem to make sense. i think everybody who deals with -- who has worked extensively with people in government who knows them personally, you feel kind of the pain of the hard time they're going through. but i say it's kind of, you know, as an american citizen and somebody running a company that sells its product abroad i prefer if we figure out a way to have a better situation.

>> there's an expectation palantir may go public and there's a view that this government shutdown might end up delaying a number of ipos this year do you think that there will be an impact on palantir? >> no. >> no. >> but you know, again, we -- look we spend most of our time investing in our software, making our products, building new products trying to trying to support the men and women in harm's way, the large industries if a future ipo was delayed by a couple months, that's a rich person's problem we should be very focused on the men and women who cannot pay their bills. >> just to put a fine point on it, you think the reason it won't delay the ipo because the plan wasn't to go public >> we're commonly known as a creative enterprise. we change our opinion all the

time in the service of building a product. on what we should build and how we should build it our business is in a very strong position and so we have a lot of options. and we'll see which option is best for the men and women who work at palantir and for our investors. we don't know. >> separately, there's a huge debate in silicon valley right now. there's a debate going on in davos. that is the relationship between business and industry, if you will and the government and the defense department and the kind of work they do and i'm referring to google's decision relating to project maven. i'm referring to the employees that pushed back against the facial recognition programs taking place at amazon and their relationship with the u.s. government you are squarely in business with the u.s. government and proud of it. speak to this debate, if you will, right now. and do you see the other side of

this argument? >> well, i mean, i'm an academic by training and proclivity i like thinking of the other side i think there are arguments on both sides i think one of the reasons why you know you have an opinion is you understand the other side's argument our view is that we built the company to hunt terrorists, to make our society safer, both in terms of fighting terrorism and protecting data. if you are at palantir, you joined because you believe having a society that has less crime, less terrorism, and works better in all questions that record safety is of importance that's the palantir answer the reason why i'm also on top of that very critical of the silicon valley approach, what made them strong was silicon valley had a supportive relationship to the u.s. economy and u.s. defense from the beginning.

the reason why people put up with crazy looking people that are doing their thing in a different way is because we have historically delivered either jobs or national security at silicon valley people understood the value of what we're doing now silicon valley's creating microcommunities that break the consensus of larger society. while simultaneously telling the average american, i will not support your defense needs and then selling the products that are adversarial to america. it is not intelligible cautioned to be more diplomatic in public. if you're going to take that position, then you have to be frontal about articulating to the american people, what is it we're offering you that you have in your life that makes your life better? is it you get to be part of an ever smaller community where everyone agrees with you okay maybe that's what they're offering

is it that the standard of living is increasing then that argument has to be made if you don't make that argument and then simultaneously say, i am not going to support a man and woman -- american male or female or a western ally who is now in harm's way to come home or i'm not going to stop a terror attack. the average person is going to think you have fallen on your head only someone with a super high iq living in silicon valley could come up with the idea that is a plausible argument. >> provocative words from alex karp i have to say, that was probably some of the most fascinating things and just the way of framing this around what's happening in silicon valley, technology companies, what they're doing to society, their role in -- >> he's right. you can't live in a bubble if you're going to be an american company and take the benefits, you better be willing to -- >> and to hear someone say it as publicly and strongly -- >> without any diplomat si or

without any veiled references. i don't think i've ever heard anybody say it that clearly. >> or being self-conscious about being one of the people he was talking about, i think right? crazy looking and -- >> well, no. what he's really saying, look. they've taken a position, their whole business is staked on supporting our military, supporting our defense >> unlike all these whose employees are now saying we don't want you working for the defense department >> middle eahe's on the other e. i think it's a provocative comment. i know it's a big debate >> jeff sonnenfeld had a comment on this today where he was talking about some of the -- >> ceos living their purpose saying one thing and doing the other. >> one of the comments he made, yahoo jerry yang saying we're an american company and we're benefitting from all of this but at the same time they were kind of turning around and allowing chinese dissidents to be picked up >> there's more of this video.

>> there's a few guys out there -- peter thiel, andreessen they're not all on board >> he's a cofounder. more of a libertarian, i should say. >> okay. you like to parse those words. you feel better about that >> no, no. peter and him disagree vehemently on politics he is not a trump supporter. >> but there are -- there's andreessen and peter, obviously. peter is the most probably high profile. >> when he talks about -- he talks about the community is very closed minded. >> no kidding. >> there's a lot more of this interview. you can watch it on cnbc.com also the comment about the ipo, i think now may be a little bit more in question if you're reading between the leaves no the lines. >> that's like a walk in the cake. >> and whether they're going to go public this year or not

we'll see. >> barking up the wrong neck of the woods there. coming up, the ceo of cisco joins us from here, davos, to talk cloud competition, cybersecurity, and much more later, a news making interview with jamie dimon, jpmorgan chase ceo and chairman stay tuned for that. positive earnings lifting futures at this hour dow now up 181 those are about the highs of the premarket session. people know aflac... aflac! ...but not what they do. so we're answering their questions. aflac is auto insurance, right? no. uh uh. is it homeowner's insurance? no... uhuhuhuh! is it duck insurance? nope. ahhh! do they pay me money directly when i get sick or injured?

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at&t is america's best wireless network, according to america's biggest test. now with 5g e. more for your thing. that's our thing. tech giant cisco was able to sidestep any initial fallout from trade tensions with china its stock jumping 13% in 2018. but ceo chuck robbins believes

that additional tariffs could come at the expense of future r&d spending he joins us now. chuck, everyone who comes on, we hammer them about china. i really think that -- >> you're going to be nice to me though, right? >> we don't hammer them. we want them to tell us all the effects on their business about china. and a lot of times, it's not necessarily that big of a deal with you, i think it could be really good or really bad for you, i think >> well, i think first of all you have to understand that our business in china is still relatively small less than 4% of our business so the impact on that side is less severe and has the potential to be. but we have great relationships there. i've had meetings here with chinese customers and chinese officials just continuing the discussions we've had going on over the last several years. the tariff situation, my point was, look. we navigated the 10% tariffs but if we hit 25%, and i've had

this conversation, then, you know, the ability to pass all that through to our customers, we're probably going to be less likely to do that. so we're going to have to preserve our financial model we have to look where we cut i hate to think of cutting innovation and r&d at a time now where 5g and these emerging technologies are important to the country. >> of the emerging technologies, i'm reading about internet of things with cisco. i never thought you'd be doing oil pipeline feedback and all these subscription type services that would change your whole revenue model, wouldn't it >> there are two separate things the conductivity in the minds and in drilling platforms in the ocean and being able to see problems before they exist or actually understand the depth of a problem without having to send a human in to actually put them at risk so you can begin to solve the issue, that technology, just that connectivity presents so much opportunity.

>> right >> the business model shift we've been making to software and subscriptions is one that we're -- you know, we're probably 30%, 40% into it at this point so far it's been successful for us >> so to -- i mean, and i'm also hearing, you know, everybody's talking about digitizing everything you do. explain that in lei mayman's te. >> it's connecting everything in the world. >> securely, i guess, too. >> that's somewhat important as well so it's -- look. the bottom line is that i've been talk to a lot of my peers here and in the midst of all of this discussion about a potential slowdown, you know, i joked last week and i've heard some peers say we're at risk of talking ourselves into something even though we understand there are a lot of geopolitical risks. but the reality is that the role technology's playing today particularly in a b2b world, even where it was before the financial crisis is completely

different. i would characterize it as before the financial crisis, companies would build their strategy and then tell the technology teams to go operationalize it with whatever tech you needed to do. and today they're defining their strategy based on technology and what it allows them to do as a business it's a subtle but really fundamental difference and so as we enter this time of risk, we're trying to figure out what does that mean for tech companies if we do see a cycle >> you know, chuck, i think about the volatility in the markets. then i think about oracle and kind of its inherent dna oracle's done 208 acquisitions since you became ceo back in 2015 when you look at market volatility, does that make you think, great there are more bargains out there? or do you think, okay, we've got six acquisitions i need to focus on >> yeah, you know, it's -- we don't see -- there aren't any acquisitions we're looking at

waiting for them to get more cost effective, get them cheaper. that's not really the case the last three years, the run-up, if there was anything of interest three years ago, it's not of interest today. i just don't think that's conceivable. one of the things i really wanted to drive starting three and a half years ago and i can't believe i'm in my fourth year in this job already really to drive up the level of innovation inside the company. and we've done that. and so we're doing a lot of small tech acquisitions, a lot of strategic wins. so i think you'll still see us do it. >> in the bolt-on category or the let's even shift the portfolio? >> a lot of what we're building right now is enhancing our core franchises one of the things i really wanted to do was stabilize and grow our franchises. if you're a mature business and look at your core franchises, you have one of two things you can either believe they're going to grow or use the profits

from those to actually fund different businesses i believe they could grow. and they are growing again because we drove innovation back into our core. at the same time, we are able to use some of those profits to invest more in cybersecurity and our collaboration and other areas we're playing in >> is the government shutdown affecting material yet >> not yet there's nobody there to place orders so i mean, that just inherently is an issue. but i don't think from overall -- >> how big of a business is the u.s. government in terms of a client of yours revenuewise? >> it is significant. >> significant >> yeah. it matters >> is that 10% of your business? >> no, it's not that big >> and the analysts know that you unfortunately make the list of companies that -- not the timing as much as just the exposure to the contracts. >> yeah. but i personally think that, you know -- i believe for no reason

whatsoever that they're going to get closer 800,000 people we see them showing up at homeless shelters now. we see tsa agents showing up at food banks this is just not right. >> the tax reform was good for cisco. >> it was. >> one shot deal sit good this year for you again? >> well, clearly we had the year over year benefit of slightly lower tax rate so i think we saw a point and a half, two points, perhaps. >> repatriation? are you able to -- do you have more money to do what you want to do? >> we do but we never had an issue before because with the debt market, we had access to plenty of capital. >> you campaigned for years. we used to have this conversation on this set about the need to be able to repatriate then what you were going to do with that cash >> and i said three things >> m&a, buybacks, and dividends.

>> we've had this discussion several times. we raised the dividends, raised buyback, and m&a. >> you said the debt markets weren't at a position where they were >> no, no. they were very attractive. >> right but you used the past tense. they still are >> they still are, but just not quite. we would do what people call synthetic repatriation by borrowing against ours a sites outside the united states. >> will you know when a pipeline fails? >> yeah. >> 2001. remember that's how we knew how he lost his marbles. because we said something was going to fail and it didn't fail >> that's cool >> look. we're not going to do it alone we're going to do it with the industrial players who have the intelligence but we're going to help them get the day to the right place and they'll have the algorithms. but if you think about what we're really going to do -- i know you have to go, but

cybersecurity is going to be nothing but machine learning and ai running in the network. because no one has a perimeter anymore. >> so we're going to be okay as humans or not? >> we're going to be great >> chuck robbins, thank you, sir. great to see you coming up, a lot more right here on cnbc the ceo of anheuser-busch inbev carlos britos. we're going to talk to him after the break. and later, michael dell is going to be our guest. jamie dimon a little bit after that but first take a look at u.s. auity futures were implied higher about 180 points higher on the dow back in a moment i earn unlimited 2% cash back on everything i buy. and last year, i earned $36,000 in cash back. which i used to offer health insurance to my employees. what's in your wallet?

welcome back to "squawk box. with us now to discuss the global beer market in his first-ever "squawk box" interview and we're thrilled to have him here, carlo brito ceo of anheuser-busch inbev. we've been having a debate about the state of the world and the state of the economy before we get into the beer business, just given where you sit and what you see, where do you think we really are? >> if beer is a metric, i think we're in a great place because beer has been a very good industry to be in being in the industry now, for 30 years myself.

middle class continues to grow around the world and emerging markets continue to give us that opportunity beer's one of those things that people tend to gravitate to as a sign of progress in life sometimes. you know, entertaining >> right but we had the ceo of coca-cola on a little bit earlier this morning. he really looked at the next year, i don't want to use the word head wind, but clearly not with the same kind of optimism he would have put on this past year you in the same place? >> well, beer tends to be more resilient than soft drinks people like their beers. what we see is if you look at asia, if you look at the americas, even europe this past year, had an amazing year for beer all the things are very important for beer what we see in beer that is very important is that's one of the few -- one of the only categories within food and

beverage that continues to grow volume and rate on a global basis. and today that's one of those things that's rare to find not saying every country but as a global average >> that's what i was going to say. not in every company united states has been a bigger difference and what is that -- is that as middle class grows in other nations, that's where you really see the growth happening >> well, middle class is part of that population growth. people having access to also amazing in some places so drinking less than times beer has gone through an amazing last ten years. assortment widening in terms of styles, varieties. and the mature markets has really clicked to it and so in some mature markets, it's true that on average, beer is not growing

volumewise but it's growing ratewise. people are paying more for their beers. it's growing everywhere. it's one of those segments that grow everywhere. >> weigh in on the trade war and tariffs. where do you source most of your aluminum >> well, from all places i mean, we're one of the biggest aluminum buyers in the world in the u.s., we source most of it from the u.s. but of course there's a whole conversation about tariffs, has an impact on us and on the beer drinker for sure because if you're a manufacturer to the u.s. today with the tariffs, you are at a disadvantage compared to beers that we bring from europe into the u.s. because that aluminum in a can is now called a can. it doesn't pay the tariffs same for cars, same for everything >> we talk about the tax changes being a huge advantage for american produces.

>> if you're importing a car, it's in the form of a car now. a beer can is call a can >> how big of a penalty is that? >> at the time what we calculated was that it would double the inflation so for a beer can, if inflation is 2% and you would pass that to consumers, you'd have to pass another 2% or 3% on top on a beer can because of that >> you partnered with tillray. clearly in north america, feel this is going to be a much bigger business. where do you see all this headed >> well, what we're doing at tillray is an r&d partnership. in canada, there's no decision to commercialize anything. a very responsible company if we decide to do anything in the future, if it will be in a responsible way, because that's the way we've always conducted our business >> do you see that as a hedge on your beer business in the united

states do you think that long-term people will smoke instead of -- or -- >> we're on the beverage side only >> so this would be cbd and other things >> infused yes. >> but how worried are you or are you about people moving from drinking, if you will, to smoking, vaping, what have you >> now that people can get marijuana whereas before people couldn't get it. people have always had pot i know it's more -- but people can choose >> it may well be you can walk in a supermarket and -- >> i know. but people either like to drink. >> i don't know if suddenly that it's any more legal than it ever was really i'm talking 30, 40 years ago zblop b >> look at the growth of marijuana usage in the states where it's legal. >> it's not you do one or the other. sometimes you do both. >> even in the states where it's legal, it's very hard these days you don't have enough data points because there's noise to

prove that beer or alcohol beverages suffer we have no data points in that respect. off lot of people going to those states because it's legal. so it's hard to do a same store sales type analysis with the same population that lives there. there's a lot of noise >> is the growth in the high-end beer market, is it craft it's not budweiser >> it's craft and import beers and different styles so people -- and michelob ultra. today the number one growth beer in the u.s. is michelob ultra. >> that's low carbs. >> dilly dilly >> you know that >> dilly dilly >> oh, yeah. for sure there's lots to come -- >> these are actually gummi bears i have in here >> but if you do dilly dilly on air from time to time -- >> dilly dilly. >> edibles >> from bitcoin to cannabis. >> let me ask you before we let you go, your company was really built on acquisitions, on combining lots of different

brands when you think about more acquisitions to come, what kind of areas -- where would you like to fill in, if you could >> our company is really built on big dreams and great people if any you look at the organic growth in the last 30 years or total growth, a lot has been on organic side and some inorganic. you attract all these talented people these people would at some point leave. let's go to another country. then we saw other people are like that. and that's what gives drive to not only the organic invention >> so are there opportunities that you think you still want that >> the world's a big place always opportunities >> okay. we'll leave it there thank you, sir great to see you

>> dilly dilly >> dilly dilly when we come back, chairman and ceo of jpmorgan chase jamie dimon. up next, though, "mad money"'s jim cramer is positive on dell stock, but he points out corporate governance may be an issue. >> you have to rely on michael dell to care about michael dell. well, he's got to deliver good numbers for himself. i like his style i like his strategy. i'm not thrilled he has a young stake going on there when it comes to shareholder voting. >> we will ask chairman and ceo michael dell about that and the company's performance since coming back to the public market right after this break [ phone rings ] hey maya. what's up? hey! so listen, i was taking another look at your overall financial strategy. you still thinking about opening your own shop? every day. i think there are some ways to help keep you on track. and closer to home. i'm all ears.

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welcome back, everybody. after spending half a decade as a private company, dell technologies is back in the hands of the public. joining us right now is the company's chairman and ceo michael dell great to see you >> great to be with you all again. >> i remember when you took this company private. how excited you were to not have quarterly earnings calls anymore, how excited you were not to have active investors anymore. are you excited and can you convince me you're happy about being back in the public markets right now? >> so look we were a public company for 25 years. and so it's not a new experience and during the period that we were private, we really transformed the company. now we have almost 90% of our engineers, software engineers. company grew 17% in gap revenues in the last nine months. data center business grew 22%. the world leader in infrastructure, hardware, software outgrowing the industry. it's really a transformed

company. yeah, absolutely we're public again and very much ready to be so >> let's talk about how your stock's been trading since you went public. i think overall the market capitalization is around $32 billion right now. you have assets that are like $52 billion. and i'll run you through some of the case on this jim kaymer talked about the ownership structure where you and silver lake really control the majority of the vote but you've also got issues like you've got a lot of debt you're going to have to pay that down before you can spend more on innovation. you can answer that question then just questions about a low margin business that is subject to kwing swings in the economy knock all those arguments off the table. >> so look the last 12 months our ebitda, $10 billion, right and if you look at our interest coverage, it's closer to $2 billion. so while there are a lot of zeros, the interest coverage is quite healthy. and we're in a very good spot.

we're outgrowing the market. we paid down $14.4 billion in debt since the emc combination and will continue to pay down at a healthy pace towards investment grade the company is doing well. growing faster than our industry if you look at our data center business, it is the largest in the world. it grew 22% year over year in the last nine months you compare that to the next two or three companies, they were growing at 2%, 3% or negative. so we're by far the largest and the fastest growing. and we have the best technology. and, look. you know, we're in a world where the digital transformation, the explosion in data, ai, machine learning, cloud, 5g, all those things are capturing the imagination of customers and

they require all kinds of new capabilities to make that happen you know, we've put ourselves in the position of combining the world's best capabilities to be able to enable that for 99% of the fortune 500 and hundreds of thousands of millions of small and medium sized businesses all over the world. >> when you talk about that innovation, what are you most excited about? what's some of the latest and greatest you're funding that you think is going to be a game changer? >> it's a lot to be excited about. you know, the last three decades were really kind of a foundational layer upon which all these new things are being created. and what's super interesting now is that the cost of a kpoort cor in the form of a sensor or small microcontroller is approaching zero so everything is becoming intelligent. you have an explosion in data. then you apply computer science to take this data to fundamentally change the

products and services and make them better. that when you layer on the next generation 5g just means there is a, you know, it's the fourth industrial revolution. now, some of it will be hype and some of it won't work. but we're seeing it move at a very significant pace across just about every industry. >> let's talk about the trade wars we've seen. if there's anything that could potentially slow down in the technology, it could be if china and the u.s. break off and each developed their own sort of intranet in terms of where we're headed, what the protocols are going to be. and whether this is going to be a globalized sector. what do you think? >> i'm optimistic that, you know, this will get improved and resolved certainly we've moved some things out of china. you know, based on the tariffs and the various rules that are in place you know, we have about 25

factories around the world and most of them aren't in china. right? and so we've got a flexible supply chain it's largely been uninterrupted from the perspective of our customers. >> where have you moveed? if you're taking stuff out of china, where's that manufacturing facility gone? >> u.s., mexico, poland, brazil, india, malaysia, taiwan. you know, you name it. so everywhere. but again, i'm optimistic that a positive outcome will be reached here because it has to be. >> do you think it's going to be harder to sell into countries like china considering what's happening with huawei, et cetera that there's going to be really decisions made along party lines but country lines in terms of certain brands and certain businesses >> well, we'll see

we have a strong and large business in china and we have critical capabilities that are unmatched by the local companies and therefore, you know, we have a great business you know, we'll see how that develops over time >> michael, we want to thank you so much for your time. great to see you michael dell coming up with ab lot more on "squawk box" live here in davos, switzerland ceo of paypal, jieam dimon, plus the ceo of uber coming up in the next hour. ♪ the kenya tea development agency is an organization that is owned by tea farmers. every week we sell this tea, we get paid in multiple accounts.

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good morning from davos. a jam packed hour of interviews with some of the biggest business leaders in the world is straight ahead >> this hour we're joined by the ceos of paypal, jpmorgan, uber and procter & gamble earnings out longs with comcast. the final hour of "squawk box" begins right now this is a special presentation of "squawk box" live from the world economic forum in davos, switzerland. >> good morning and welcome back to "squawk box" here on cnbc

we are live from the world economic forum in davos. it's like 2:00 which is weird for "squawk box." because it feels like it should be 8:00? i have a calculator here i'll get back to you i'm joe kernen along with becky quick and andrew ross sorkin strong earnings from dow components are what's happening this morning as you can see the dow futures sharply higher including procter & gamble, united technologies, ibm last night. all these boosting the futures right now. 185 on the dow the s&p up 12. the nasdaq indicated up 33 that's on a relative basis, pretty strong this morning let's give you some details on the dow stocks on the move this morning starting with dow component procter & gamble it came out with earnings better than expected. the consumer products giant earning an adjusted 25 cents a share. those results helped in part by

strong demand for their beauty business you can see that stock is up by 4.2% this morning. then there's dow component united technology also beating the street forecast. the industrial products maker reporting profit of $1.95 a share. that is well above the consensus of $1.53 a share revenue also beating estimates those results helped by the company's november acquisition of rockwell collins. and you can check out that stock. utx up by 3.4% also media company and cnbc parent company comcast beating estimates in the latest quarter. comcast earning an adjusted 64 cents a share. topping the street's expectations by 2 cents. also revenue beating what the street was expecting and comcast increasing dividend by 10% that stock is now up 3.5%. >> let's talk about paypal due to earnings expected to be better than a year ago period, payment company's been on a big drive to gain more of the digital payment industry and been unafraid to tackle

controversy along the way. joining us now is dan shulman, the ceo of paypal. i want to start with the government shutdown because you took steps i believe just last friday with a new program called paypal helps to help government workers who are not being paid >> that's correct. first of all, thanks for having me >> dpra >> great to see you. >> last week we decided that we had both the opportunity and i think really the responsibility to step up as the private sector we put aside $25 million into a fund so we could loan up to $500 million in a totally interest-free cash advance they really need our help. >> if this shutdown continues,

is this something you would consider expanding >> possibly. possibly i think it's really important that we as ceos really think about our companies as part of the communities we live in i think doing these kinds of things and a lot of people think about purpose and profit as being in different camps i think that's a false duality i think those things our community becomes part of us as well over the long run. >> by the way, what is your expectation for the government shutdown in terms of business broadly? are you seeing less people use the payment network or the payment? government workers actually spending less money? >> the shut down's been going on for a month now. and those workers as i mentioned, you know, count on the income from those paychecks. and they are hurting right now they're having a hard time

buying groceries they're rationing medication of course spending a down as a result of that from a paypal perspective, we have a lot of tail winds at our back we live in the digital economy things are digitizing. retail is moving towards digital. mobile's exploding and so in our business, it remains strong >> we talked a lot about the trade war with china wanted to get your sense in terms of your ability to do business with china long-term. obviously wechat has a huge presence there that's a big competitive challenge. but also the larger overhang of the u.s./china relationship. >> yeah. well, you know, my guess on that is that resolves itself in some way. i think both for china and the u.s., it makes sense for there to be an agreement both major economies with both major trading partners, it makes sense for that to happen

we'll see how that winds up. but for us, china's a very important part of our business we don't have a domestic payment license, so we don't operate inside of china. but we're a very important platform for exports, online exports outside coming out of china. so we take our 250 million people on our platform and other players inside china put the paypal button on their merchants and our consumers outside of china purchased and they export goods out. so there was a big business for us, a growing business for us. and one that isn't affected by these trade wars >> let me ask you about cybersecurity. it seems to be a huge topic here so many boards of directors asking about it. so many ceos asking about it you scare me to death every time you talk to us because of how

many attacks are coming into your system every day. are these companies becoming woke to this or are the hackers getting hard tore find, tracking more companies >> cyber's been an issue for quite some time. and as more of the world digitizes, as more of everything we use is involved with software of some kind, elevators we go on, the dams that protect our -- >> thank you once again, something to think about i hadn't >> everything resolves around software as that's increased, so have the attack vectors for cyber but i think for companies like paypal, for financial services company, they've been woke for quite some time around this. we realize that identities typically are compromised so we do many things beyond user name and pas word you have to look at 30 or 40

different variables on almost every transaction to be sure that the transaction is valid. and it really is you who's coming in. and we're able to do that now with mobile devices. >> how many attacks on a daily basis? >> so in general, the average american business gets attacked hundreds of times, but financial institutions get attacked over a billion times a year >> want to get your thought os an separate issue. in the last 48 hours, you probably saw the news. elliot management took a stake in ebay which used to be the other half of you. you still -- a huge part of your business, ebay, as a client. long-term, do you think ebay remains an independent company with an activist in there who historically has pushed these companies into other hands >> it's hard for me to comment exactly on that letter and that note ebay is about 10% of our overall volume much smaller than what most

people imagine, you know, when we split off there something like 30% or 40%. they're much, much smaller listen we're big strategic partners of ebay we work closely with them. you know, we wish them the best of success because i hope that they are very successful going forward. and we'll see where that winds up >> we got to run, but it's a topic we never talk about. this whole time, bitcoin what do you think? price has dropped this past year >> listen. i have always thought that crypto was more of a reward mechanism for implementing blockchain opposed to really a currency and we're not seeing many retailers at all accept any of the cryptocurrencies but i think the underlying technology is still interesting. >> alcohol or pot for you, dan what do you like >> i tourn you first and get your opinion. >> i don't see why it has to be one or the other

right, andrew? is. >> paypal or bitcoin what are you trying to say >> pot or alcohol? >> cheers. >> you missed -- >> dilly dilly >> yeah. dilly dilly. >> dan shulman, ceo of paypal. >> some big guests coming up on "squawk on the street" at the top of the hour. sara eisen joins us now with more sara >> hi, joe, andrew, and becky. yes. excited for the next few hours here we're going to talk to early facebook investor jim briar at the top of the hour. we're going to play you some highlights from my conversation with goldman sachs ceo and christine lagarde going deep on gender equality. and where the biggest opportunities are in finance and where this industry is when it comes to hiring and promoting women. hot topic of discussion here in davos. guys, i know you talked about png earnings just out. stock on the move. we're going to talk to the ceo

david taylor tomorrow. the p&g earnings sum up what we've been hearing from some of these big guests and that is maybe a slowdown in growth but not an all-out recession and still plenty of signs of growth in pockets around the world. so we'll definitely get into those themes as well as you have becky? >> okay. thanks, sara when we come back, jpmorgan ceo jamie dimon will join us to talk banking, regulation, and the state of the u.s. economy as the longest shutdown in government history reaches 33 days you're watching "squawk box" on cnbc i consulted with your grandmother's doctor. we can do the screening at her house. hi. this is the man that's going to check your eyes grandma. cognizant ai solutions are helping healthcare companies advance diagnostics and prevent blindness in patients with diabetes. everything looks good. you have beautiful eyes. ♪

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and the army taught me a lot about commitment. which i apply to my life and my work. at comcast we're commited to delivering the best experience possible, by being on time everytime. and if we are ever late, we'll give you a automatic twenty dollar credit. my name is antonio and i'm a technician at comcast. we're working to make things simple, easy and awesome.

don't know whether we want to start with this joining us the longest running ceo -- it's true but let's say wise you've been through a lot. jamie dimon. made some news last week, didn't you, my friend that was interesting could you expound on that? if the government shutdown continues, we actually could bring on a -- more than just a slowdown we could bring on zero, perhaps? >> first of all, welcome happy to be here i was repeating someone else if it lasts the whole quarter,

it may grow zero i don't know we all think it's kind of a hockey stick that exponentially gets worse as people stop spending money we just don't know we tried to figure it out. but it's not a plus out there. >> the recent developments, and i don't know -- we're right in the middle of it now i just wonder if you think the more we hear about coast guard, not putting people on the table, it's incumbent for someone to move off the dime. >> i heard david ruben steen on your show say -- and he had probably spoke to somebody who knows. the democrats and republicans should sit down and finish this issue immediately and compromise to do it >> the idea they've let this go on for 33 days >> i don't know.

i thought the president moved a little bit part of that was i think a billion and a half things democrats wanted everyone wants daca to stay. three years, permanently, you can argue. but to me it's the makings of a deal it's going to get worse for the american public. they shouldn't allow it. it's damaging. you see customer confidence coming down because of that, because of trade, all the noise around the world about populism. if policy makers want the economy to grow -- >> what is it having on the banks? we're going to see derek who's maybe going to pursue an ipo in 2019 everybody's pens are down right now. which means bankers, lawyers, accountants, anybody who would be doing that kind of business is at least temporarily not doing it >> people waiting, people not getting comments on their 10k.

they're not good this is not the way to run it. our government should find a way to never do it again. >> are we at neutral fed funds >> i don't know. can i give a quick assessment? all the noise out there, the u.s. economy is kind of like a ship that's going, 2.5%. and that's going to keep on going for awhile then you have all this other noise. okay geopolitical noise, brexit noise. shutdown, trade. and those kind of -- lyike in te waters of that ship. i don't know if it's 2020 or 2021, but the range of possibilities is broad er and bd outcomes is increasing >> then it's not 2% to 2.5%. we're back to maybe 3% >> it's possible i think the fed will look at

that's still a good thing. the why is much more important >> that's if they read the economy right. >> my guess is all this stuff, they're going to wait a little bit. adjusted for the shutdown. that is a good thing even the imf, it was reported very negative. they reduced their global forecast from 3.7% to 3.5% most of the negative coming out of europe. >> jamie, in terms of gdp u.s., you were with president trump on the idea we could get to 3% or 4% >> one of the few c erneos? >> most economists an ceos would have told you -- >> whatever. >> we could debate -- >> that's a false assertion. >> but the question was -- >> a lot of people liked the tax reform and the deregulation. >> i'm not dissuading you of

that view. >> maybe economists. but ceos >> the question is now that we're back to -- the question is now that we're back to 2.5%, how do you think about that a year ago? >> absolutely. if you make a list -- i mean, sometimes if you look at ourselves, like what can we do better as a nation not just yelling and screaming we don't get infrastructure done right. we don't get the kids apprenticeships to get them jobs it's a great health care system. best in the world. 18.5% of gdp we don't give our felons jobs. if we go through our own issues and fix them, we'd be growing 3% to me, reform is part of that. regulatory reform, tax reform. small business formation was lowest its ever been mostly because of regulations and lack of access. but the thing that we have to do

so as facts, analysis, detail, not just slogans you made a list of the policies we've done in america the last 50 years that were complete and utter failures and they're still there. we should acknowledge that and fix it you have -- >> what's at the top of the list >> well, i would put on the next ground is immigration reform hurting this country dramatically i mentioned you guys before. eight years to put a man on the moon 12 years to get the permits to build a bridge education and think of education where kids graduate high school, vocational school with apprenticeships and training that gets them a good job. and health care. i think these are more complicated, but we need to work on that. regulatory reform still needs to be done. we put in place -- we have in place regulations that are being followed basically to -- they're bureaucracy. it's bureaucracy it's not -- and it's some form

of sinecure. and they're not federal. travel with me one day and visit a bunch of small businesses and ask them what they had to go through to open a small business how many licenses they have to get. how many times they get audited by the city, state, federal government for one store with, you know, ten people working in it it's us. we did it to ourselves >> jamie, is there anything to the notion that we're trying to come out of the extraordinary measures after the financial crisis we make it back to 2% and change and things start slowing is there anything to the notion we've built up so much debt that, you know, the slightest increase in rates causes the debt service to go up to where it's unsustainable and you start choking off at much lower levels >> even seth thinks we're going to get to that point >> seth made a list of a lot of things the fiscal issue is a real issue and it's really got to be dealt with it's not an immediate issue. so our debt to gdp is like 80%

on its way to 100% on its way to 120% we could afford all that it becomes a hockey stick in about 50 years it's all related to entitlements smart people would say my god we got an issue let's get together and do it much more efficiently. >> is the -- >> but it's not the reason you're going to have a recession tomorrow >> but is the reason we're now at what may be neutral at what seems like a historically low interest rate level, is that because inflation is going to be permanently lowered because of innovation sor it because we can't afford to go up any higher because it just gets prohibitively expensive? >> i don't think it's either of those. i think it's a bit of both of those. and all the other things that affected growth. innovation in america is unbelievable it's just look at the things i said that are hurting productivity infrastructure hurts productivity immigration hurts productivity not having kids have jobs hurts productivity take kids. we've got half the kids in inner

city high schools don't graduate and we have a -- it's a crisis i don't see people saying we have a national emergency. and then all the people involved should get involved and say let's do something about it. i don't care whether you're a union member, teacher, parent. it's an emergency. >> are you just barely a democrat what are you now >> i don't relate to either. >> you've been on the record just barely a democrat have you revised that? >> no. my heart is democratic, but my brain is kind of republican. >> did you hear that, andrew >> i heard it. country over party country over party >> i don't know how that applies to you at all. but anyway >> i'm going to stick with that for now. china. how does that play in this whole conversation and where do you think that sunsnets out? >> it's the most important relationship geopolitically in the next hundred years the trade issues raised are right. both sides want to resolve it.

every time we might resolve it, things get better, looks like we won't resolve it and things get worse. if you have tariffs getting in place on march 1st, that would be bad for the global economy. >> when you say resolving it, if you talk to people like ray dalio or others, they talk about the idea we've gone from cooperation to competition to maybe something even worse in that's a much longer term battle >> china has serious issues. they don't have a fooed war. i'm not insulting them just don't blow it out of proportion and not just for us. for the europeans and the

japanese that will be better for the world growth a lot of america's problems are our own doing. i don't think they should go to chinese medicine over there and say that's why we have our problem. it's not. >> you talk about getting an agreement and etreaching somethg before march then you talk about the detail where is you need to get into intellectual property and other issues that are longer term. what's more important? to have something done by the beginning of march or addressing all those topics >> i'm going to tell you what i think is going to happen i think they'll get enough done, kind of agreements and principle before the end of march to extend the deadline. it's hard to get something done by march because of the complexity if you read the papers and read between the lines, they will allow more american foreign companies to control their companies there. that solves two problems unfair investment and some of the forced intellectual property management i can do business there. but got to put my technology in. have a form of ip being stolen

a quick form to stop that. the chinese have been talking about reducing their tariffs unilaterally then this whole thing about china 2025, that is little component pieces it shouldn't be -- they have the right to have industrial policy, to grow their country, help their people but what they don't have the right is to use state owned enterprises, theft, subsidies, forced transfers all these things to dominate industries at the -- against other countries around the world. so i think the chinese -- i think they're quite bright i think they see -- if you walk around here, you know the japanese, the europeans, the mexicans they all feel this needs to be fixed. it's 23409 against china it's just let's clean up the global trading system. >> so do you think the davos zeitgeist from last year was as positive this year as tempered

as enthusiasm is >> the great contra indicator. >> you guys always think of the common knowledge i would always bet against it. but going forward against it -- >> probably about the same last year as it is this year. we think it's like this. probably maybe like this >> markets sense sentiment the narrative, the ek coch echo chambers >> united states is doing fine trade may get resolved and all those things may reverse. we're going to have a recession one day. we don't know exactly what's going to cause the next one or what the timetable is, but the financial system is in far better shape in the united states >> as a risk manager and you're one of the best, obviously, we go back to financial crisis, obviously. is there anything that you see icebergs you feel like you're in the "titanic"? >> i'd say lots of little things like brexit -- if that goes south, that's not good if trade goes south, that's not

good if the shutdown is gone for longer, that's not good. and then indirect confidence having seen confidence come down a little bit if i was a policy maker, i'd want to get these things resolved have good policy, maximize -- >> those are the risks to the downside what's the upside surprise >> that china gets done. >> you think that's almost built in though? i think the group think is there's an expectation come march 1st, something will happen >> i think that's probably true. but again, i always look at the range of possibilities i hate guessing about one because you don't really know. you know, my guess is the data of the united states, good coming forward everyone's going to take a deep breath after that. >> if we're here next year going, what's going to happen with this china? and it's not going to be totally fixed bau eed because this is a multi-year thing i would guess a year from now every other word won't be china. we'll be onto something else >> can i ask you quickly, you

brought up health care costs several times. obviously you're working with amazon trying to come to a result with that how soon might we see some sort of announcement? >> we're just hiring a great team and looking how we should attack this problem, it's a long-term view we don't expect any announcement any time soon. we will share if we come up with anything good. but we want to start small, test a bunch of different things. but what we really need now is a great team we have the best health care in the world. doctors, hospitals, pharma, you name it. but we also have some of the worst outcomes obesity, wellness programs that could work part, the opioid problem, 40 million uninsured. to me you look at the whole issue. for the american world, the developing world spends 9% on medical. you look at the competitive issue over the future, that's a huge impediment over the next 50

years. >> do you want to do it or do you want me to do it >> which one >> did you take any satisfaction when bitcoin dropped 80% or no >> nope. >> didn't take any -- >> listen. you guys -- i said it before when aol went up and came down, it was -- >> you guys? >> you all put it on -- >> don't look at me. >> you actually put it on cnbc every day for a year bitcoin, bitcoin you should not do that >> not on our show >> you should stop doing that. >> we agree. >> you weren't charlie munger. >> we didn't have the button or bug on the bottom. >> no. but we did that interview at delivering alpha that was the day he said it was a fraud. and well, we'll see. >> you didn't use an expletive >> using blockchain, that's different. but even that, we've been talking about it now for year after year after year. for seven years and nobody's effectively done something >> it's either talk about that or about pot i think bitcoin is better than marijuana, isn't it? >> it is, but we're not banking

pot either >> we'll all hang out at the blockchain lounge here this year >> there is? >> blockchain is probably a real technology with data it's just a data base we can all access it's kept up-to-date it may be usable for certain things and not for others. for equity trades, requires 2 cents and equity costs you a penny. you're not going to use it for that. >> the new buzzword is protocol which is the intranet of blockchain >> that's the other thing. for a blockchain use case, you have to write the code we have a agree on protocols it's a lot of work to do something. but we're doing a bunch of stuff now that's interesting once you start you can expand it >> all right it's always a highlight, jamie we make these little things called chyrons my heart's a democrat, my brain says republican. i'm going bring that up for you a lot. >> for the rest of your life

>> thank you, jamie dimon. >> thank you coming up when we return, the ceo behind what could be the hottest ipo of the year if the government doesn't shut down government doesn't shut down uber since my dvt blood clot government doesn't shut down uber i was thinking... ceo could there be another around the dara will be here or could it turn out differently? i wanted to help protect myself. my doctor recommended eliquis. eliquis is proven to treat and help prevent another dvt or pe blood clot... almost 98 percent of patients on eliquis didn't experience another. ...and eliquis has significantly less major bleeding than the standard treatment. eliquis is fda approved and has both. don't stop eliquis unless your doctor tells you to. eliquis can cause serious and in rare cases fatal bleeding. don't take eliquis if you have an artificial heart valve or abnormal bleeding. if you had a spinal injection while on eliquis call your doctor right away if you have tingling, numbness, or muscle weakness. while taking eliquis,

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. coming up, the battle for affordable health care in the united states, kaiser permanente ceo bernard tyson joins us to talk about mental health, drug pricing. stay tuned you're watchi ining "squawk box 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?

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welcome back to "squawk box," everybody. we are live from davos our next guest is on the front lines of the battle for affordable health care joining us right now is kaiser permanente ceo bernard tyson >> great to be here. >> we had a long conversation with jamie dimon and touched on health care quite a bit. of course they're working with amazon and berkshire to find ways to bring down health care costs for their employees. when you look around, if you had some advice to give for people trying to fix the industry, what would you tell them? what works for you and what could be used on a broader scale? >> i mean, i think a big part of it is the evolution of how we define and think about health

care working on the three building blocks now that we start to focus on medical excellence is the first one. mental health and well being, second one and social care. jamie mentioned, for example, 18% of gdp is spent for health care well, mix in there social care and all the other things that we're talking about. so we need to figure out how to create an equal system for health in our country that really starts to bring to bear all of the social determinants of health. how we go up stream in more prevention how we engage the american people much more in things that they can do for good health and then how do we continue to drive waste out of the system and take advantage of the technology that's allowing us to practice better in our organizations and our physicians inside of kaiser permanente is doing tremendous work in driving the agenda of medical excellence, for example,

and really leveraging technology that enables more efficient care >> what happens when you employ some of those technologies how much do you actually bring down overall costs for health care >> we look at it in two ways one, how do we reduce the absolute cost of health care over time? that's a journey we're all on. but we are definitely seeing signs of progress. the second one is how we manage the trends and the trends is a big one. because as you know in the united states, they are trending anywhere from 4% to 6% >> health care inflation costs >> yeah. inflation costs plus we try to keep ours in the 2% to 3% range with other things we're working on while also improving access and quality and the whole experience that people have with our system -- within our system. >> go ahead. >> go ahead.

>> no, no. >> one of the things jamie also mentioned is we have worse outcomes in a lot of ways. if you look at things like obesity or opioids, how do you get your arms around those issues how much is what you can do for people and what is what they have to help with? >> there you go. obesity when it is in the health care system, it's a fix me approach the real question is how do we work with the american people in this example around the behaviors that leads to eating the wrong foods, in some cases lack of exercise some of the challenges that is related to health care but quite frankly is in everyday living. so how do we think that through and create new incentives and programs that gets to the behavior aspect in which when we get it is after the fact right? so that's part of how we have to rethink how we provide health

care in our country. at the beginning of this year, there was a number of big health care deals consolidation taking place. there sort of seems to be two sides to this story. which is, one, need to bring down costs and one of the ways to bring down costs is to merge and somehow those costs are going to flow to the consumer. and the flip side is that they're going to merge and the costs will never actually get transferred to the customer. just make the company more profitable and which merger are you supposed to look at positively and which do you sit around and go, actually, this is going to be a problem >> you know, the way i -- a couple of thoughts because kaiser permanente is a big health care system, you know, we're approaching $80 billion in revenue and we take care of 12.3 million people that i round up to 13 million so we're on your way to 13 million. there are benefits with a large

system such as o you ares that you can scale. there's no question about it you can come into our system and you will see a level of efficiencies that shows up in less variation protocols that others have agreed to follow because it's been proven to be effective. it's an issue of how you take innovation and spread it to others >> that's the argument for the consolidation piece. >> now, these megamergers should create efficiencies. how they are then distributed out is part of the debate. the efficiency goes back to our customers in the forms of lower rates. when i say the unit cost, from $1 to 90 cents what we're dealing with now is instead of the costs going up from a dollar to $1.05, we're

trying to keep it to $1.02 so our efficiencies are returned in the form of lower rates however large systems try to distribute those efficiencies, obviously, is driven by many factors like howthey're constructed. we have a not for profit organization many of them are for profit corporations >> bernard, want to thank you for your time today. >> i want to thank you >> bernard tyson with kaiser permanente a lot more to come this morning on "squawk box." the uber ipo, competition with lyft, and softbank's investment. the ceo of uber is going to be with us in just a moment here in davos. you're watching cnbc back in a moment you should be mad at forced camaraderie. and you should be mad at tech that makes things worse. but you're not mad,

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welcome back to "squawk box" this morning live from davos, switzerland. the u.s. government has now been shut down for 33 days. now some federal workers are turning to the gig economy like driving for uber to make ends meet joining us now is uber' ceo. we're thrilled to have you >> thank you for having me >> we've been talking to every ceo about what's been going on back home and the shutdown interestingly enough, there are now a number of federal workers who are trying to make ends meet being uber drivers >> yes we love it when new driver partners join the platform, but this is most definitely not how we want new driver partners to join the platform. >> how many have you seen join >> we haven't quantified it, but it's definitely happening in d.c. and happening to the most needy. listen we're hoping that this ends. obviously it's out of our

control, but one of the benefits of uber is for people who are displaced temporarily, if they lose a job, if something happens and they need earnings opportunities, uber is there then when they don't need uber, they can move on as well. >> what's the up front cost for a driver to jump in? >> you've got to own a car you've got to have a license you have to do a background check although we wocover that cost for you the cost is really de minimis. you just have to make sure you don't have a criminal past that would cause an issue in the platform >> one of the other issues related to the government shutdown has been the delay in ipos and the fact that the 5,000 workers at the s.e.c. have now become 250 workers at the s.e.c. and their pens have completely stopped working effectively. what does that mean for the ipo you have talked now so much about being a 2019 proposition zbloo >> i've been told i talk too much about the ipo so i won't specifically talk about the ipo.

i tell me team focus on what you can control. what we can do is run a good business, build a terrific service, continue to build our brand. that's really what we're focused on right now >> in terms of growth right now and profitability, how much are you focused on the growth piece ahead of the ipo and has that shift changeed? >> well with whab we want to build is sustainable growth that can be profitable. sometimes near term, for example, if you look at one of our largest and fastest growing businesses is uber eats. home delivery of food, almost 200,000 restaurants in under 30 minutes. it's a magical experience. and we have had cities in which the eats product has become profitable, but essentially once we saw that program working, we're accelerating city launches, early cities early on are unprofitable, but we know the model is sustainable over a long period of time. so we talk about near term

growth with long-term profits. >> you just said your message to your team is don't worry about what we can't control. focus on what we can what's on your list of things you can't control that you'd like to get your arms around >> i think one area we could control is making sure that our growth is now on concert with regulators of cities with which we operate i think in the past and listen to some extent it was a strength but it's not something that is sustainable. we grew just purely based on consumer demand. and we didn't necessarily take the time to have a dialogue with cities as to growth that serves all of the constituencies. we're having that dialogue now it sometimes causes complexity in our model sometimes causes us to pause, but it creates a lasting model and what's special about uber is, we're part of life in the cities where huge labor force, et cetera. we got to take the time and have

that dialogue. >> it wasn't you were just not taking the time. before you were the ceo, the company's plan was to sneak under the radar and do as much as you could are you still dealing with the aftereffects of bruised egos, bruised feelings in some of these some i would tell you that the majority of municipalities, their goal is to improve life for their citizens, with the folks who live in their cities, and life with uber, life with uber eats, life with jump bites et cetera is better and it is how we can achieve our goals and be respectful of some of the limits that they put on us. >> talking about growth, but also talking about profitability, one of the issues we talked so much about was autonomous vehicles, the role that uber planned or expected to play in that, and now what appears to be a little bit of a retreat in that world. >> mm-hmm. yeah, i think we certainly took a retreat based on the accident that happened last year. and we took that opportunity to

really rebuild how we build product. but i do think that autonomous is an enormous technology. it will bring huge strides in safety, huge strides in making transportation available to more people around the world. anytime you have a technology that is as earth shaking as autonomous, it doesn't come easy. >> do you think you need to be at the forefront of building and creating and inventing that technology and investing in that up front, or do you think -- or have you shifted your thought in terms of letting the way mos of the world and others take that innovation risk, if you will, and then maybe later on either partnering with them and bringing them into your portfolio? >> listen, if there is one thing uber is about, it is about innovation risk. i don't think it is a have to, it is a we want to be at the forefront. i think we he want to be at the forefront because we think that building out autonomous technology in a live network, we don't need to build it for every single circumstance, we don't need to build it for bad

weather, for if there are accidents, et cetera we can build autonomous and launch it for situations, simple situations one step at a time. >> how is the timeline changed do you think we used to say 2020, we would aall all be jumping in the cars, you were talking about that too. >> i think the timeline, it is proven to be more difficult than we thought >> because of technology or regulation >> yes both >> yes to both >> yeah. i think that regulation is going to be -- play a big part in that introduction i do think that because we run a live network, the problem we're solving for us is going to be simpler than anyone else's and, by the way, we are completely opening to partnering with third party autonomous because ultimately we believe in the technology we want to own a part of it. it is a great opportunity. but we think this will be good for society. >> just coming back to the ipo issue, you don't want to speak to too much of it, your main

competitor wants to go public. >> so we heard. >> so you heard. >> i guess they announced. >> i'm sure you've given thought to this, does it matter who goes first in terms of setting a floor for the valuation in terms of how the public and the investment community thinks about these type of companies? >> floor or ceiling. >> floor or ceiling. >> i tend not to worry about those issues listen, whoever comes first comes first. >> is it a race? >> no. listen, the race is in innovating and building a service. from my standpoint, there is no race going public. if we do it, when we do it, we will do it when it is the right time for the company >> this is a big enough service, big enough brand where i think that there will be a market for us anytime we go public when the time is right. >> i love it you're mainstream, just so you know you don't need to hear that, but -- >> mainstream, is that good or

bad? >> when it hits me, it is -- >> he's using you -- >> mainstream or jumping the shark, one of the two. >> it is a huge load off of my mind a lot of times whether they're at a party at night or, you know, the college, the high school one, it is a huge load off of did - >> this is how it changes lives. we want you to be relaxed and happy. >> i don't like when they cancel >> we don't like it either. >> i want to find the person who cancels and, like, hurt them >> i have two related questions, one is about safety. you made a decision, really an interesting moral decision, relates to growth, relates to purpose and all of this, where effectively you slowed down your growth and i believe your profitability to invest on the safety side in terms of drivers. >> yes, yes. >> walk us through that thinking a little bit. >> i think that -- >> what was happening that really led to that >> what was happening was my team, and operating team, the folks on the ground in mexico,

brazil, the u.s., et cetera, they all came to me and said, listen, with the numbers getting this big, with our platform getting as large, we have to take responsibility for the platform so i got to get credit to my operators. this wasn't like the ceo, the moral ceo coming down. the team said, with a platform this big and when you got people's lives in your hands, this isn't about privacy, these are people's lives, we got to invest in safety, even if it causes short-term pain and growth we came together as a team and we're building technology, making sure that the background checks, et cetera, all of that is being done. we have 911 button just in case something happens. there is a whole host of activity going into safety and it came from the team. >> and then final question, do we have time i think we have -- very quickly. saudi arabia >> yes. >> you didn't go to saudi. they're a huge investor. has your view changed about whether you want to do business with certain countries, including saudi arabia >> we want to be in as many as countries as we can because

ultimately we think our service is good for society, it is -- it provides lots of job opportunities for drivers out there. we hesitate to make kind of judgments based on, oh, this government is good, this government is bad. we want to be on the ground on force for good and usually i think if we're a force for good, we can move -- move forward societies in a positive manner >> okay. dara khosrowshahi, thank you. we'll check the numbers and get started for the trading day. tomorrow, another big lineup of guests, it all starts at 6:00 anil wlltern mewhe,e' be right back after a quick break. endless fields of grain....

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okay, welcome back, everybody. let's take a final check on the markets before we hand things over to "squawk on the street. you're going to see once again stronger than expected earnings from lots of dow components, united technologies, procter & gamble, helping to boost the futures this morning when we started three hours ago, futures indicate ed up by 89 points don't forget ibm's numbers from last night that is helping the dow and the nasdaq you're going to see the s&p 500 indicated by up by 11 points now. the nasdaq indicated up by 30 points in europe, you're also seeing a bit of a mixed picture things have improved ftse is down by a third of a percentage point other markets up with spain being the biggest gainer, up by

1% oil prices we talked a lot about this week with some of the major players we talked to including chevron's ceo earlier today on "squawk. oil prices now looking at up 27 cents. $53.29 a lot to talk about. we're really just getting started. >> powerful three hours. powerful three hours >> big three hours >> powerful hours coming tomorrow join us then right now time for "squawk on the street". ♪ ♪ i've been losing my mind good wednesday morning welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber a wave of earnings from utx, procter. they'll above the the dow by 125 points at the open got some mild gains in europe. bank of japan holds steady the ten-year around 277.