"squawk box" begins right now, though ♪ live from new york, this is "squawk box." good morning and welcome to "squawk box. we're lamenting the loss of amazon kelly he have arnz is with us this morning becky quick is in los angeles. she's going to join us just a little later from now. she has a huge one-on-one interview with berkshire hathaway vice chairman charlie munger one who never holds back and always makes news. let's show you the u.s. equity futures at this hour the dow looks higher just a little bit higher about six and a half points right now. it was down literally, i

believe, just about 15 minutes ago. we have results from pepsi reporting for the fourth quarter, and core earnings came in at $1.49 a share. that was right in line with expectations revenue coming in slightly above expectations we're going to have to watch to see how pepsi reacts to the forward guidance where pepsi

typically looks for 7% to 9% earnings per share growth, and the company is now forecasting down 1% for 2019 it's not currency-related. currency is going to be a 2% headwind this has to do with investing into the future. this is the gentleman's new -- >> new initiative. >> i think he came in on october-november, and the company thinks that at least in their view their frito-lay offerings and their beverage offerings have a lot of up side, but need investment. they need a bit more trucks. they need a lot of different initiatives that will go into effect in 2019 to try to boost revenue growth from 3% or so where it's typically been to 4% to 5%. companies characterizing it as an investment effort that will pay off in future years to -- because they've got great products in their view to jump-start faster growth, but

for anyone just looking at the guidance for 2019 down 1% is below the long-term rate >> coke was talking about, though, the -- >> currency. >> -- currency issue >> 7% to 8% currency this is only 2%, and i don't know what the difference is. maybe coke does some hedging with currencies or perhaps on the wrong side of that i'm not sure.

>> i permanently -- i think it's -- i think it's a lot of shutdown stuff because there's interesting weird stuff happening in december where people were not using credit as much cash numbers were higher remember, we're not -- >> of course, a little bit of a wealth effect. not even the wealth effect, but just people waufing the headlines. it doesn't even mean you had to say, oh, i'm directly losing money. you're just worried about the economy, and, by the way, polar vortex >> i know. >> did we name it? >> i think -- >> what happened to the end of snow "new york times" told me that in 2014, andrew a big headline the end of snow. we got to revise that. >> there's still a climate issue. >> let's talk about -- >> suggesting. >> you're going to change on that, too. i've got you in -- suddenly you're a capitalist. i'm going to get you to change, and you're going to be a skeptic on climate by the end of this. you are. you are coming around. i'm so proud watching you yet, i'm telling you, i was swelling with pride people at home are, like, what

are you doing? i'm just watching my little guy. some weapon of mass destruction things can happen. if you get what you want, aoc and liz. what happened? did you guys are no longer going to dinner every week, i guess. asc and liz. >> i was never on the side. chinese president xi meeting with trade rep robert lightheizer and steve mnuchin. it's not immediately known how

much progress was made we'll have a live report from beijing in the next half hour or so certainly, the indications, the tweets, the comments, the meetings are helping futures turn around by about 80 points to send the dow up nearly 30 right now. >> okay. let's talk about the story that we can't stop talking about and neither can new york city and really frankly, around the country right now. amazon's decision to abandon a planned new york headquarters is reverb rating throughout the headquarters others labelling it a disaster the 2.5 billion dollar project would have brought in 25,000 jobs to the long island city area over the next decade. it became hot button issue among local politicians. some of whom said the economic initiatives incentives offered to amazon were too generous. amazon says it won't seek a replacement for the planned new york city project, and will focus instead on its new headquarters in northern virginia and in nashville.

>> the "new york times" editorial page came down >> the journal's take has it exactly right. >> you had a situation where i don't know if you had a twitter war, but these are real jobs >> i think it's bigger than a twitter war. i think there's a real sense amazon creates homelessness. we stood up to a big corporation. this is deeper than just that. >> take it away, andrew. take it away, buddy. i'm going to take -- i'm going to have a little bit of an off day. i don't have to talk you just -- deferring to you on this >> to see politicians taking credit for killing jobs, i -- look -- >> because it creates -- >> i'm the last person that

wants subsidies. i wish we could rid -- >> why would anyone come to this state or city without subsidies? you screwed it up so much in terms of taxes, aebt business rhetoric the only way to get anyone here is with subsidies, and then you are surprised. new york will long-term lose -- >> tranlic >> if you believe that financial services are going contract and revenue, you want to diversify and get a tech hub there you want to create -- >> cornell had just brought that science and technology -- >> great great educated people. to have people like aoc and elizabeth warren and others say -- call it a victory, i mean, that's the part that i just don't -- i don't

understand skbro almost a billion of this is available to any business that pursues jobs in new york. another billion, too, is refundable tax credits only if 25,000 jobs were created by 2028 then half a million. there's two views that i didn't understand last night. one is somehow that they really -- i think she -- i think there are certain politicians who really belief this $3 billion -- so-called $3 billion in incentives can now be used to fix the subways. $3 billion doesn't exist >> they need $42 billion to fix the subway >> anybody that doesn't understand that the subsidies were in lieu of bringing a bunch of stuff in, no one thought -- >> and then people would point yesterday there was the news report saying that amazon had want paid any federal taxes last

year. >> part of me thought yesterday, what would happen if we had no subsidies in america if you outlawed subsidies in america. for people who are truly progressive, you got to rethink this, because it would mean -- you would think that you would be leveling the playing field, but it's the opposite. any area in america that doesn't have the ecosystem to want it to be attractive would need -- >> which is what you want cities to turn into >> that's what they were trying to do. >> i don't know if it's single progressive edict that doesn't need to be rethought in terms of the real world in terms of this number one, i wish we had a couch for you. i really think watching that right there, i -- you need to just get this off your chest, but in a horizontal position

where we can all talk it through. it's partly amazon's fault for not going to a state that is business-friendly to start with or a city that's business-friendly to start with. >> it's their fault for doing this in a publicized way >> it's like "the bachelor" and de blasio and cuomo were -- >> it was misunderstood that somehow because cuomo and de blasio had blessed this that they weren't going to need additional political support and this was going to work people are saying they're taking their ball and going home. who wants to move into a neighborhood where a vocal minority is standing outside your house telling you how terrible you are every day >> de blasio was telling them how it's going to be, too, in terms of unions and everything wrelgs they're like wards of the state in the plogsive eyes where, they exist to supplement government not vice versa.

>> you don't have any real estate >> i have no financial interest in this beyond -- >> can i go look at them how much was actual waterfront >> we know some guests who -- >> i like the guy senator -- i think he is going to get some flack. >> i think he is coming on >> i think as it settles in, he is going to be -- >> are you kidding me? what i want to ask him, it's being all spun for people who are on that side of the aisle in

this particular instance as being some kind of great victory. he had said even when he was with us that he would consider it a victory if they left. i thought that was a negotiating position and posture i cannot imagine that's what he really wanted. i want to try to understand that >> i think he thinks it plays well with his constituents >> what i don't understand about that piece of it is, you know, if you really wanted them here, i mean, and if underneath it he did want them here, it's very hard to take that position on day one. you want to say, hey, amazon, we're thrilled to have you thrilled we would love to, you know -- >> you know what's weird >> play with this and -- >> nobody likes the government getting revenue and then using it for good cause. maybe government can effecttively use those how did they not see your point on schools and roads and everything else from new york city how can they think this is a victory that the dollars are not coming in? >> because a larger

philosophical view that if you could end subsidies here by the way, it's interesting because republicans historically -- >> we don't like subsidies either >> i know. >> to come here, there's no other way they're coming without subsidies. >> in this instance, i think that's right the question is how idiosyncratic is this situation, and what does that say about politics in america? >> you mean on the set i know it's insane. it's insane. i'm just going to -- i don't have to talk today the weekend is here for me >> a lot more on this amazon story this morning >> take it away, andrew. >> the man, as we said, that the new york post called the prime suspect, new york state senator mike generos, and new jersey governor phil murphy will be with us. >> newark, looking good. >> and we have new york representative carolyn big morning ahead and a lot of debate coming up

>> coming up, i'll do the ins and outs, congress passes a bill to prevent another government shutdown president trump is declare ag national emergency you're want even talking about that, andrew i can't believe you're not talking about trump. the battle to fund the border. >> fssflz,rut is it will get back >> the battle for the bothereder wall hey, how ya doing? uh, phil. are you guys good with brakes? we're ok. just ok? we got a saying here. if the brakes don't stop it, something will. that's not a real saying. it is around here. i wrote it. just ok is not ok. especially when it comes to your network. 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. ♪ don't fence me in.

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>> dow now up 30 points for the open s&p. same for the nasdaq. it's really the blue chips leading the way here pepsi reported a short time ago. not too much movement, though. shares under pressure. nasdaq on a five-day winning streak >> president trump expected to sign a spending bill, but that's only the beginning eamon joins us now from washington friday is part of the weekend, eamon. right? is it not? >> it's a three-day weekend coming up. monday >> right thank god for those presidents

the president agreeing to sign the spending bill and finally passed congress last night the president has agreed to sign it, but he is also going to declare a national emergency here's how that's going to break down he wants $8 billion for his border wall. he is going to take different pots of money, including $1.375 billion that he got in the appropriations bill. that's for fencing and other structures $600 million, is he going to take from treasury's drug forfeiture fund. $2.5 billion from the department of defense's drug interdiction program. then the national emergency declaration will give the president access to $3.5 billion to the department of defense's military construction budget that's the flexibility legally that that national emergency declaration will get the president. he gets up to $8 billion all in for border wall and security on the southern border. the president declares that national emergency conservatives have worried about

a national emergency declaration because there's some fear of executive overreach here they worried that a future democratic president could use it on gun control or climate change or something like that. nancy pelosi, the democratic speaker of the house, made that threat almost explicit yesterday. here's what she said >> democratic president can declare emergencies as well. the precedent that the president is setting here is something that should be met with great unease and dismay by the republicans. >> the white house yesterday -- you know, what the white house's line is on this concern about a president and what a future democratic president might do, and she told me, well, we'll just have to hope that there are

no further humanitarian crisis that a future president has to deal with. the white house effectively sort of brushing off this concern about what could happen in the future very much focused on what this president can get politically and financially right now. we're going to see it all play out at 10:00 a.m. in the rose garden, guys >> i couldn't help just seeing the irony. i really agree with speaker pell oes w -- pelosi there think what we, the democrats, might do just think about the stuff we would do with a national emergency. that will scare the hell out of anyone the wacko -- imagine what they would do imagine what they would do with a national emergency that scared me she's speaking to me >> we'll see if the house passes a resolution against this and kicks it over to the senate. it's going to put a lot of republican senators on the spot that don't really like the idea of a national emergency, but who want to support the president by wanting to get the wall funding fight over with. they don't want another government shutdown, which was disastrous for them politically.

>> everything is nuanced these days we don't know who we are anymore in terms of what we thought our feet were in stone on certain things lindsey graham makes sense we have no place to take care of the people coming across the border we just don't. we either need to let them go. we don't have the facilities to keep them, and there are thousands of people that continue to come in here i know that they say it's a made up -- i know they say it's a made up emergency, but it's just -- i guess we need a law or something. that's not coming. i don't know what the answer is. snoo right >> it's all personal, right. >> she spoke to me there >> we can't, god forbid that she's in power someday well, she is in power, but -- >> ultimately, what do you do, right? the president because of his right wing politically he can't sign this deal and do nothing else and just sit on his hands, right? he has to show action to his base that he is doing something to get this fundamental core promise of his campaign done in his first term in office this is the route he has chosen.

conservatives on the hill and elsewhere are worried about it, but i think ultimately they're going to go along with it. then the next question is what happens with the lawsuits, right? presumably somebody is going to file a suit to try to stop this. white house officials have told many he that they've looked at this very carefully. the lawyers have been vetting this i know that the white house counsel was in the oval office yesterday working through all this with the president. they've been talking about it for weeks now behind the scenes. they feel that they've gone after the pots of money where they are legally the strongest, so they think they're bullet proof in terms of a lawsuit. we'll see if that works out in the court. a lot of people think they're relatively bulletproof on a lawsuit and find out they're not. ultimately, the white house is expecting this this could be tied up for a while. the president might not actually get all this money right away. it could be months maybe years even before this works its way through. >> all right eamon, thank you >> you bet >> you might be able to answer this, too.

twitter is useful sometimes. this is a question now is andrew woke now, or are you no longer woke >> that's a very good question that's a very good question. >> i don't know how to answer that do you >> he is woke. >> i'm woke. >> now you are woke, but you are like me. you are like me woke >> i'm woke to the woke. i'm woke to the woke that's what's going on >> woke to the woke. that's great >> woke to the woke. that's what's happening here coming up when we return, we'll get more woke to the woke. we'll tell you why facebook may be on the receiving end of the federal trade commission's largest fine of a tech company ever the details of all that coming up stay tuned you're watching squawk on cnbc with expedia, i saved when i added a hotel to our flight.

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they're trying to settle a fine the fine could be the largest the ftc has ever imposed on a tech company the two sides have not yet agreed on an exact amount. let's check out shares of facebook this morning. down just about half of 1% we looked at shares of amazon, by the way impervious to everything going on >> i'm not sure this was going to have any real impact. the decision where this goes because, look, they're going to find other places to employ people >> they're -- >> they're up. they're up >> coming up, the markets are watching every move on trade as the u.s. and chinese officials wrap up their latest round of

talks. we'll have an update and check out what investors should be watching later, berkshire hathaway charlie munger talking to becky quick. they talk about value investing and the national debt and the amazon hq drama. as we head to break, a look at yesterday's winners and losers on yesterday's s&p 500 >> i loved that. that was great >> it was pretty great >> well, it wasn't bad >> it could have been a lot better >> i didn't really like it it was pretty terrible iwabad. >> it was awful. >> it was bad. boo. when you retire will you or will you just be you, without the constraints of a full time job? you can grow your retirement savings with pacific life and create the future that's most meaningful to you. which means you can retire, without retiring from life. having the flexibility to retire on your terms.

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welcome back you are watching "squawk box" live from the nasdaq market site in times square. >> good morning. welcome back to "squawk box. futures at this hour have now turned positive. maybe there's once again the slightest movement in this china trade situation. it can either, you know, we're only talking 30 points in is00

point swings from time to time we hear conflicting things it's a long way to go, but, you know, everybody is optimistic. we'll see what finally happens what did happen today is _#woke to the woke. >> woke to the woke. >> woke to the woke. i'm looking on twitter to see if that can -- >> i'm calling it, andrew. i'm going to be reading about this in a scholarly journal. they are going to use you as the example. >> woke to the woke. into we'll see whether there's a groundswell or not where. >> i'm not sure i believe this aoc really didn't say that the $3 billion -- >> yes, she did. >> look see the video. >> the $3 billion that doesn't exist unless they come here will be used to give raises to the teachers >> we'll get you video >> i saw her on "seth myers. are you sure it wasn't the fake aoc? >> i think there is a view among. by the way, it's not fully that i don't think she understands it i think she just has this idea that it's all fungible and the

money. it was like a philosophical view >> it's a trajesty i think it's a half travesty an half tragedy >> 8:30 a.m. we'll get a read on import prices. 9:15, the import production. the senate report for the month of february. it's after yesterday's weak retail sales report from december president trump is expected to speak in the white house rose garden about border security we have a whole lot on tap the markets also focused on any trade developments coming out of china today eunice >> thanks so much, andrew. well, treasury secretary steven mnuchin and robert lightheizer

on their way back to the united states after two days in beijing. they capped off their visit here with a meeting with president xi jing ping, and according to the state media president xi has said that the trade negotiations are going to continue next week in washington. he also pointed out that the trade negotiations here had reached important step by step progress in the latest talks and he also had made some other points about how they hoped that the two sides can reach a win-win agreement. in terms of the -- for now we're waiting to hear to see if there is going to be a statement the negotiators here have been focused on trying to hammer out a memorandum of understanding that could be used as a basis for a summit between president xi and president trump sometime in the future. most people are thinking this could be sometime next week. now, before anybody gets too

excited a lot of the back chatter here has been that the two sides are still very far apart on a lot of important issues the chinese have been focused on trying to boost imports of american goods however, there's still a lot of -- a lot of people have been saying that there's been a stalemate when it comes to some of the tougher structural issues in fact, president xi himself had referenced some of the challenges saying we are willing to adopt a cooperative approach to resolve and promote an agreement acceptable to both sides. however, cooperation requires certain principles they are saying china has its bottom line as well. guys >> okay. eunice, good to see you once again. let us know, and i'll -- i see your tweets. if anything happens, as i said,

i -- >> but i don't please tell us >> you can did. >> yeah. >> i follow everybody. i follow her >> she's so woke to the woke she's not on twitter anymore >> oh, that's right. >> i'm so flattering i'm so flattered >> we need yoon on the tube. >> i follow very few people, and i follow eunice. keep us -- i worry about you, too. just make sure everything is okay over there. anyway, let's talk about what a potential trade deal could mean for the markets. ryan deitrick, lpl financial, senior market strategist, and jason pride, chief investment officer of private clients at glen meade we're up a little bit this morning. i'm worried about -- i don't know what did retail sales tell us? that's front and center for what happened yesterday it kind of threw all of our thinking into -- or at least revising some of what we thought about this strength in the economy given the jobs that we've seen, and, you know, the

notion that a recession is not at least a 2019 likely there do we have to change that based on retail sales. is the number right? >> you are right that was a wake-up call, that poor number. what did the markets do? took it in stride. you know, you think about my house, the deitrick household. we have a lot of the gift cards laying around. those gift cards don't really account for retail sales until you use them right there with the government shutdown, we're not thinking that that's probably the most accurate number. master card said we had the best spending holiday season in six years. it's probably somewhere more in the middle the market shook it off. two things, joe, that i think are really important to note here underlying technicals are strong, and market sentiment, people aren't buying into this rally. just this week we had new all-time highs on the s&p 500 advanced decline line. the nasdaq is00 advanced decline lean, and midcap advanced decline line that's a lot of participation. that's the sign of a strong market not a weak market. talk about markets for a second. s&ps up 17% from the lows.

look at the dow up eight weeks in a row likely today we don't have a big sell-off today. that's a good thing. people are buying into it. the aai poll, it's one poll. we've gone 13 weeks in a row without as much as 40% mom and pop isn't buying into this what are big investors do? the global survey that comes out. highest level of cash since before the financial crisis. money on the sidelines i get it joe, a lot of people have not participated in the rally. maybe a little consolidation, and we think this bull market is alive and well, and yesterday's number is -- we're probably ignoring it right now. we see more data points, yes, we would be more concerned. >> jason, you can comment on that or china. i'm starting to wonder whether a farable resolution for china might not give us as much upside as an unfavorable development might give us on the down side do you think the markets are already rallying on thinking that it's something positive will eventually happen or not?

>> i think trz some hohere's soe there. i think there's a lot of tension, and even the commentary that we just heard shows how much uncertainty there is and how far apart the two leaders are in terms of a deal i don't think anybody has that accounted in at this point in time this is a worry that's in the back of investors' heads it's probably some of the reason that the sentiment hasn't popped all the way back i think the contrast between the environment we're in now and what we were in in december can't be more different. sentiment had hit an absolute floor on christmas eve, has rebounded to now it's still not fantastic, but it's got a lot better. if you think of the news flow, we went from what was -- what seemed to be a fairly hawkish fed to a fairly dovish fed now we've gone from a worry about recessions to a people kind of, you know, coming back to this idea that the recession could be going on longer. i think if we were a step back into the back drop here, reality is we are in the ninth, tenth

year, depending how you counted of the economic expansion and bull market. this should be some residual question in investors' heads as to whether this could come to an end at a point in time in the future our recent recession model readings are pointing to about a one in three chance of recession within the next 12 months. that's not an over 50% chance. it's not saying this is the end. it does mean that there's a little bit more pronounced risks here we think it's representative of the fact that this is late cycle than late cycle is very different from the beginning of the cycle, and investors have to position portfolios accordingly. >> one in three -- i don't know. could be wrong sounds high, but you never know. it's things like that that sneak up on you. thanks, jason and ryan we got to go i don't know why, but we do. bye. >> got a lot of amazon to talk about. plus, risk may be off the menu for some of the nation's biggest investors. that's next. berkshire hathaway's charlie munger speaking to becky quick she'll join us with that interview at the top of the hour stay tuned you're watching "squawk box" on

cnbc

>> it's time for the executive

edge whale watching, as it's sometimes called leslie picker is here now with some of the investing trends of the biggest names on wall street it's scleer that some of the well known hung e hedge funds soured on two industries in particular fangs and financials corvex selling some of its facebook pairing back amazon. dissolving net flick, and omega cutting alphabet even berkshire hathaway, which has been building a massive position in apple, sold some of its stake in the quarter tiger global dissolved one million shares of apple with david tipper and george soros selling out of their stakes completely financials, too, really turned out of favor in the fourth quarter. corvex and each selling shares in large banks like bank of america and citi berkshire hathaway sold some of wells fargo, and then actually added to its positions in jp morgan and bank of america as

well as pnc financial u.s. bank corp. and bank of new york me n melon. it's important to know that these positions are as of december 31st and may have changed in the six weeks it gives us a snap shot of what they were doing in the fourth quarter. >> what do you think the take-away is especially given how bad the fourth quarter was in the markets what are you gleening from these filings? >> i think it's a risk-off environment for hedge funds, and based on people i've spoken with that trade with hedge funds, that risk-off attitude has continued in the six weeks since. despite the fa account that the market has gone up despite the fact that people are, you know, maybe feeling a bit more bullish. >> does that mean they're missing out on the rally >> it is hedge funds have taken off leverage ever since the fourth quarter. they've also, you know, looked at places that they can find a little bit more stability, and i think the big issue for them is just really this idea of all the headline risk out there. they didn't know what was going on with the shutdown >> akman has done pretty dpood >> akman up 25%. >> is it just he bets on chipolte every other strategy thrown out the window?

>> if you are long and leveraged to the market, this is a good market to do that. >> leslie, thank you >> i'm afraid to do anything >> you got courage, joe. >> i mean, with what "the post" and -- what they normally put on here, they put -- they put bezos exposes pecker you remember that, right >> it could have been a bit more graphic today. >> you think they missed out on an opportunity >> i think they did. >> you're not going to say it either you're afraid, too >> they missed out on an opportunity to say bezos pulls out. >> you said it not me i don't -- >> it would have been too explicit ion kw atoure>> d'tnowh y a talking about. at&t provides edge-to-edge intelligence, covering virtually every part of your healthcare business. so that if she has a heart problem & the staff needs to know, they will

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. last night nvidia reported fourth quarter earnings. they beat on the top and bottom line stock is slightly off its highs but up 5.7% right now. joining us to help break down the numbers is an analyst at arc invest he also worked for nvidia from '06 to 2015. welcome. >> thank you. >> what do you think about the warning last month and the concerns about the graphics chips and gaming trends and so much else? how is nvidia set up now >> after january's announcement, people were just coming to this call hoping not to hear more bad news i think they had a fairly optimistic guidance for the full year >> is it too optimistic? >> it is slightly optimistic

i read a few reports coming in before this morning. and a lot of the folks are skeptical. they're guiding down the first quarter. but thaur guiding to roughly a flat year. they're saying the second half, we'll have an inflection. >> that's a huge one to drive off of what's driving that inflection >> they said gaming is going to be much more strong in the second half. and there are customers which took a pause in spending last quarter. we haven't seen them ze sell rate since pretty much the business started >> we'll that aside for a second when we say fortnite -- look at the stocks of the video game companies because of the fortnite effect of last year now ea is out with a new game, apex, another on -- >> you're on top of it >> my question is, is that's what's going to drive the gaming rebound? or are they geared to the $60 games you buy from these versus

the battle royalroyals >> if i buy your game or i play fortnite i'm not playing the other person's game. no matter whose game you're buying, you're running on hardware nvidia has been strong the last four years they're not tied to this whole gaming software selloff that happened last year >> so why did they cite it in that warning >> demand in china >> it was all china. >> it was weak like apple. also they came out with high end gaming cards last quarter. but not mid-end gaming cards which is what most of the sales is that hurt them now, they've come out with that recently so now they have things for everyone. >> so they think this is going to be driven by a rebound in china? >> a rebound in their more affordable product lines as well as a better macro picture out of china. they were very cautious on their call they were asked many times, how are you going to see the second half acceleration?

and jenson pretty much said we'll see quarter by quarter and give you updates >> can i ask about crypto? how much do you think that's weighing on all this >> a lot i mean, if you look at the chart, the gaming revenues fell by 50% we don't see that in even in semiconductors you don't just fall 50% intraquarter basically didn't sell any new cards into the channel because it is stuffed with crypto buyers having offloaded their inventory. >> what about the data center before we go what are the issues there? intel also had some weakness >> yeah they did the data center, that's been a rocketship all along they had the first decline then what they said is some major customers didn't close the deal in the last quarter broad based cautiousness in how they spend if this china thing gets sorted out, i think definitely we could help with that but long-term i think is important to look at the picture that kind of -- the intel side of cpus which is how most enterprises have gotten

performance to this point, that has stopped growing. n video gpus are the only way we can get a lot of performance without spending a lot of money. so long-term we think that could be a $30 billion market and nvidia is at $3 billion today. >> thank you for joining us today. come up, becky quick sits down with charlie munger in a cnbc exclusive to discuss the markets. berkshire's apple position, stock buybacks, and more and then later, we have all the angles covered on amazon's shocking decision to withdraw its hq2 project from new york. from real estate to political fallout and everything else. stay tuned you're watching "squawk box" only for people that are woke to 'lbeig bwo wel rhtack. obvious. sometimes, they just drop in. cme group can help you navigate risks and capture opportunities.

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amazon pulls out of new york the political battle raging over subsidies and job creation the details on what's next is straight ahead breaking news on china trade talks. the futures turning positive on news that talks are coming to washington we'll get the latest from d.c. and find out what it means for investors. plus, charlie munger on the record becky quick joins us with more

of her exclusive interview with the berkshire hathaway vice chairman as the second hour of "squawk box" begins right now. ♪ live from the beating heart of business, new york, this is "squawk box. >> good morning. welcome back to "squawk box" here on cnbc i'm joe kernen along with kelly evans and andrew ross sorkin u.s. futures at this hour up single digits now. but in the red becky quick has made her way to the west coast she spoke with berkshire hathaway vice chairman charlie munger and i just want to know, were you able to get him to say the word turd again? >> no, but i didn't know that was the game if you'd give me a heads up or a challenged me, i might have tried. >> remember about bitcoin?

>> he has plenty of times. in fact, i think one time recently i spoke to him he talked about polishing turds but not this time around >> of course there's going to be many, many other great -- >> lots of things. when charlie munger speaks, i don't think he cares a hoot about what anybody thinks. he takes shots at people he took a shot at elon musk, we'll talk about that later. but he also sits down and thinks through, explains his thoughts on business. i sometimes see him as the high priest of business he calls out where he thinks things are doing well. but he also calls out bad behavior he's got no holds barred on any of these things. we talked about what it means for these states to be trying to lure companies while others are saying no. he's got deep thoughts on that he called out university saying it's insane how they're 99% liberal. he has a problem with that and really for this annual

shareholders meeting here for the daily journal, it's a tiny company, but it draws hundreds and hundreds of people who come here who are kind of cramming their way into this tiny room to help them speak. it's because of all the things he says, not just about daily journal and business, but what he says about life these are people that come in and ask questions about what the secret to a long and happy life is they think charlie's got the answers. we listened to a lot of them yesterday. of course people always wonder what he has to say about the markets too. that's what we're going to be talking about first. we'll come back with more on the next block on that >> becky, i would have been one of those people out there. we thought it would be awkward if i just took the day off to go you know >> there are a lot of people who do that. these are people that come out -- a lot travel from a long way away, from china, india. people definitely took the day off yesterday, also happened to

be valentine's day they're willing to be away from their loved ones for that period of time. >> wait. what >> yesterday was valentine's day. did you remember you forgot >> changed ties midway here. what are we going to do about the universities >> he doesn't have an answer >> he doesn't have an answer >> he doesn't have an answer, but he thinks it's crazy how the universities kind of wound up in that position. and he worries what it means for the people who are being taught there. >> that's what i mean. they're eventually going to be -- i don't know if they'll be sitting here hopefully they'll get a better education than that, but they're going to have important jobs and if they're -- >> yes >> ifindoctrinated to the woke -- we got a new expression here. woke to the woke andrew says he's woke to the woke. >> i've been listening for the last hour. >> woke to the woke. >> i wish everyone could get woke to the woke and then maybe

move forward from there a little bit, right i'm worried about -- i think aoc went to boston university. did she have an accounting course there what do they teach in those -- do you know, andrew? financial literacy >> i don't know. >> oh, you're afraid to -- what's your expression it's a buffett expression. >> praise by name, criticize by category >> yeah. that's not exactly charlie's way. >> not exactly charlie's way that's a warren way. >> we look forward to it we miss you. but kelly's here >> i miss you guys too kelly, i'm glad you're here because you are a munger fanatic, i knew i'd have stuff to talk about with you today >> you're a groupie almost >> he's 95, it's okay for me to say it we'll see you in a bit we've got breaking trade news crossing this morning. u.s. and chinese trade negotiators will meet next week in washington. let's get over to kayla tah shee who's got more >> we are getting news that

talks in china have wrapped with this agreement to keep talking china's president xi after meeting with the u.s. officials says those negotiations will continue next week in d.c. that is according to chinese state media. but those media also say secretary mnuchin and lighthizer say they'd like to find a mutually beneficial outcome from these talks. they wrapped earlier and we await any official statements from either side on what progress was made. secretary mnuchin tweeted that the meetings were productive but the two sides have been progressing in talks despite china's unwillingness to stop the practice of forced technology transfers china reportedly maintained that position this week and wants to maintain that position until the presidents meet effectively deadlocking the core issue in this trade fight the fact the trade talks will move forward yet again is a sign the u.s. feels there is still common ground enough to do so. we just have two weeks between now and the march 1st deadline that the trump administration

says it's open to extending but undecided on doing so. and joe, it now appears that the clock is ticking now for next week's talks in washington to see if they can reach an outcome before that deadline >> right yeah and that's why the markets moved, i think, today again. but in your view, i don't know none of us know whether it's in the markets or not i just wonder if the risk is now balanced or asymmetric if we don't get a deal, i think it may be bad. and i'm not sure how much upside we get if we do get a deal >> it depends what deal it is. the expectation now is if china maintains this position, maybe it could be a short-term deal. the u.s. leaves tariffs in place. maybe if china makes good on its end of the bargain at some point in the future there would be these snapback tariffs where the u.s. starts selectively rolling back some tariffs. but if it does that, then yes the fact that the u.s. and china

would be in better relations, i guess, is one way to put it. that that would lift a cloud over the market. at the same time, it wouldn't necessarily roll back all of the tariffs that companies have been citing in their earnings which is one way that we've seen this play out in the markets. so we'll see exactly what this deal is if we get one. and what the immediate economic impact of it would even be >> kayla, you didn't see that weird poll yesterday about fortune 500 ceos are now thinking that tariffs are good for them did you see that >> i did the ubs survey they did that survey in august and again yesterday where six out of ten ceos say the tariffs are good for them. my understanding of that survey is that it's 300 small and medium sized business ceos and so certainly i would read that survey pool to be a little bit different than fortune 500 companies that have a truly global supply chain that may

have been disrupted by this trade fight. certainly there are different factions of people who feel all right now we've opened pandora's box. get what you came for because there would be no other time in the future where you have more leverage than now. >> i read it certainly as it was surprising i don't know whether it's an outlier or not you don't normally see -- >> how high was that >> like 70% or something like that 60% or 70% all right. thank you, kayla kayla tausche. joining us now, founder and ceo of zoe financial and founder of bronson group out of all the things that we talk about and you think about every day, is china one of the big ones or the other things? >> china, i mean, the fed has dominated the process at the end of 2018. china was right there behind it. throughout the year i think the trade war was probably the biggest thing adding to

volatility then the drop was more fed induced. you had the word in that last interview about the asymmetric nature where we are. unfortunately, i kind of do think that right now if a deal doesn't happen, it's really bad. and if a deal does happen, which it will, it's just sort of good. it's mostly priced in. and none of us can quantify it clearly think the market is expecting that deals come. and i think the market's right to expect it both sides desperately need one. president trump needs one more politically. china needs one more economically at the end of the day, i think it's going to happen >> how about you you've always had an international outlook. i'm not sure that your sort of more friendly feelings towards the rest of the world make sense here >> i would say the market these last couple weeks remind us how hard it is to predict in the short-term if i told you that earnings guidance for this year for s&p were at 8% are now at 5% just over the last two months, you've

seen a significant cut on guidance that this quarter guidance year over year is now negative. you probably wouldn't guess the market's up double digits. the way that i see it, you have a trifecta situation which is goldilocks here in the u.s. moderate growth, inflation contained. then you have a fed that has gotten -- you mentioned the fed. i think that's definitely on the market and there's another aspect of it that is not talked enough. if you look at financial conditions all those things actually ease conditions in the back of a fed turning dovish so those in the short-term i think are part of the reasons why the animal spirits have woken the market >> they're getting woke to the woke >> woke to the woke. >> you think there's a valuation

advantage in markets versus the u.s. still >> in short-term, i don't think the market cares about valuation. but if you're looking five years out, i still think that internationally it looks more appealing. we go back and forth and depending where the markets are one week to the other, one side is crazy versus the other. short-term, i don't think the market cares much right now. >> i don't think i want to be invested over there. >> well, i would specifically look at emerging markets as a better play. i think it's been a value trap for the better part of five years. >> they've got eu car tariffs coming on germany and germany is basically in recession already they're talking maybe they'd retaliate against tesla. >> the interesting thing about europe is these trade conflicts, the worst outcome is for them. because they have no leverage. they have no say on this >> you mean even the u.s./china issue -- >> china is hurt next. and europe is the worst because they have no negotiations in this >> and that's germany's biggest

customer base. what do they do? if you're an eu, what do you do? >> i think they have to change their business model and that's going to take decades. it's not going to take years >> did you adjust your s&p targets after december >> i didn't adjust s&p targets because we're not index investors. we're not looking to own the whole market but i did adjust our expectation for our own equity returns just in the sense of valuations dropped. as we came into the new year, particularly in the spaces that we really like a lot, energy, financials, those valuations were really attractive i do believe that right now, you're seeing normalized valuations so you have to moderate those expectations but the issue about valuation with u.s. relative rest to the world, you could have said it every single year since the financial crisis every year and yet here we are, u.s. real gdp growth is 35% since the crisis europe's is negative so the valuation sometimes is

not producing an opportunity it's telling you what's wrong. i think emerging markets is the most attractive valuation. but not across the whole board not the big exporters. not the big, you know, commodity sensitive space. i think you have to be selective even in emerging markets u.s. is where you want to park money right now. >> there are some individuals that supposedly called the 2008 crash basically because they call for a crash every year so when one does happen, they can say i called for it. one fairly prominent one said this is the beginning of the end we're seeing right now because the fed can't get out. what we always worried about they can't even -- they inflated the system so much they can't even get above 2.5%. and that's not a neutral rate and we've got no tools. >> are you saying you should ignore that persh? >> i'm saying if i listen to him every time that he said -- you

know, the proverbial broken clock, but only a -- not even twice a day. maybe once a generation that it's right but i don't know there's some merit that there's no free lunches to what bernanke did in terms of -- >> but what if it just stays on -- if the balance sheet stays at 4%, 3.5% for does that mean they're going to have to buy stuff to keep it that size if there's runoff >> the getting out scenario is -- even though it's taken longer, getting out is tough right now. the market sort of told powell -- i don't know what it was. but the markets told him to stop, right. and the markets shouldn't dictate -- >> the market should not >> what else should dictate it thanks to andres and david let's get you some of the headlines. here's what's making news at this hour. the controversy over amazon's decision to abandon its planned

new york city headquarters continues this morning politicians who oppose the deal thought the incentives offered to amazon were too generous. those who supported the deal point to the loss of 25,000 jobs we' we're watching shares of pepsico this morning they reported $1.49 per share. revenue was higher than expected pepsi gave a forecast for the year that falls below estimates due to includeseded investments as well as a stronger dollar the shares are up 0.5% also out with quarterly numbers, deere which has been outperforming caterpillar by a lot lately deere earnings came to $1.35 a share well below the consensus $1.76. they said the bottom line was hurt by higher costs for materials and logistics. as well as customer concerns over tariffs and trade policy. the share is unchanged couple of stocks that are on the move this morning, nvidia beat wall street forecasts by 5

cents while the graphic chip maker's revenue was slightly above estimates. it also forecast better than expected sales for 2019. applied materials, profit of 81 cents a share. beating estimates by 2 cents while the semiconductor manufacturing equipment maker saw revenue come in above forecast however, it issued weaker than expected profit and revenue guidance for the current quart perp. okay coming up, a lot more on "squawk box. becky speaking with berkshire's charlie munger yesterday afternoon. what do you have coming up >> well, is the golden age of investing over that's the question i posed to charlie munger also asked him whether market valuations are too high here er've got his comments aft this break stay tuned you are watching "squawk box" here on cnbc

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welcome back to "squawk box. take a quick look at the futures. let's show you what's going on right now. we are in the green after being in the red just about an hour ago. dow looks it would open up 30 points higher. s&p 500 up a little over a point. we're watching shares of newell brands this morning. stock off 11% this morning despite beating bottom line estimates with latest earnings sales were below wall street forecasts. 2019 outlook weaker than expected among newell's problem areas, it's graco baby products unit which has suffered because of babies r us going into bankruptcy at least that's what they're saying coming up, we've talked about that he'll on today. charlie munger making comments on the markets becky quick brings us that interview and his take on whether the golden era of investing is over. and later, amazon pulling out of its -- bezos pulling out of his planned headquarters in new york city

we're covering all the angles. it says this moroning-i don't know if they're talking about me governor phil murphy joins us with his pitch to the company. i always thought newark would be the best place for amazon. i'm not kidding. the next beginning in a minute 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? yeah. aflac! you got it. you know aflac! boom! get help with expenses health insurance doesn't cover.

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now the answer to today's aflac trivia question. what company used to make pocket-sized tvs the answer, sony with the watchman in 1982. we're going to get back out to los angeles this morning. that's where becky is right now with her exclusive interview with berkshire vice chairman charlie munger take it away, becky. >> thank you very much i was here for the daily journal's annual meeting he is the chairman and ceo on that company he's got a couple hundred employees. 440 shareholders that's it. but there were more than 700 people who came yesterday for this meeting they came from all over the world. they spilled out into the haul they overfilled the overfill room they were all waiting to see what charlie munger had to say

what they most wanted to hear were his thought on the marks. you spent a lot of time today talking about how people who think that they can keep the market averages are probably fooling themselves how much tougher it's gotten to be a value investor or an investor in general. i was just wondering, do you think the golden era of investing is over? >> well, not forever >> why >> because i think -- it isn't like the last recession or the last big opportunity that the world is ever going to get is passed there'll be opportunities in the future there are times easier and times which are harder. >> so is right now tougher just because valuations have come up so much? >> of course "a," valuations have come up but "b," the competition sorting through those opportunities is

more intelligent, more aggressive, and more numerous. of course it's harder. the net result is people are going to get worse results >> do you think the number of people who are smarter, who have better information than they used to, that that will go down or it'll just be a question of valuations coming down at some point? >> well, i think valuations will go up and down because they always have. i think we'll have smart people in this game forever the opportunities that we all remember came from a demoralized period where 90% of the natural stock buyers got discouraged with stocks. that's what created the opportunity for these fabulous records that my generation had and that was a rare opportunity that came to a rare group of people of whom i was one.

>> do you think we saw a generational low after 2018 -- 2008, beginning of 2009? >> maybe >> he compared constantly the idea of being a value investor to being a cod fisherman he said the people are still out there, but you're fishing in the same spot and the fish have kind of moved on. that's a lot harder to find things that aren't of fairly valued and aren't living up to make a big killing. he did say he does not think we saw huge dropoffs.

that happened so briefly, it's hard to be standing there. he said it's kind of like you have to be a spear fisherman sitting there waiting and waiting for one big fish then it's harder than it used to be guys, you've been weighing in on amazon's decision to give up on a new york headquarters all morning. that news actually broke during yesterday's annual meeting we asked mr. munger about it we'll bring you that part of the conversation later >> give us a hint, please. just a little taste. >> charlie's very logical. and the idea of states wooing companies i think is one that sits okay with him that it's something they should be doing it's a logical decision. he talks a little bit about that >> i look forward to that. >> i still haven't heard what he said about tesla either. >> it's to come. >> thank you, becky. coming up, real estate brokers were banking on the amazon effect in new york.

that dream bubble was bursted last night we're going to have more on amazon's decision to leave new york and what it means for housing in the area. as we head to break, a quick look at equity futures which have rebounded from losses earlier. we're back in two.

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want to get to kayla tausche immediately. >> we're getting a statement from the white house summarizing the talks in china the statement from the press secretary says the discussions this week were detailed and intensive and it led to progress between the two parties. the statement says that the u.s. side focused on structural or long-term issues like the forced technology transfer and like some of the other issues that the u.s. side has been hammering on throughout this process they said that the two sides also discussed china's pledge to buy more u.s. goods. but it does not say what the outcome of those discussions was. it does say that there is much work that still needs to be done and that a lot of work remains here and that the talks will continue in washington next week. so now that is confirmed by the u.s. side as well that the chinese officials will be coming to washington to continue these talks. but according to the white house, detailed and intensive discussions but much work

remains. >> help us here in terms of just reading between the lines. the much work to come, does that suggest to you that there's any chance that we could have a deal by march 1st >> it really depends on the two presidents here and whether president trump feels like there's enough progress that has been made to essentially bypass that march 1st deadline and keep the talks open what i'm reading from the statement is the u.s. side wanted to deal with some of these structural issues. the chinese side wanted to talk about buying more u.s. goods and we obviously ended at a stalemate. that's how i read the line much work remains that's how these talks have basically gone from the beginning where china has been willing to provide a short-term near-term solution to try to close the trade deficit. which is important to president trump but doesn't solve the issues that have been raised on intellectual property violations and forced technology state owned enterprises, some of that stuf so it does seem to hint at the fact that these two sides are

coming at these talks from very different places and that they didn't -- they made progress this week, but perhaps not the progress needed at this moment in time to go ahead and delay that march 1st deadline. >> okay. kayla tausche. i'm trying to gauge whether the markets are going to look at that positively or negatively. right now, the market is not -- in terms of futures -- is not moving that materially >> maybe because it's both sides of the mouth it's whatever you want it to be. >> it's whatever you want to think. except last week we got news that it looked like news was moving ahead and i think larry kudlow or somebody else came out and said -- >> we're still far apart >> -- we're still far apart. and now on the middle. >> they're not budging on opening up -- >> it's very hard to handicap. >> yeah. >> i got -- >> back to amazon. >> you're back to amazon we're going to talk about that

in a moment. >> queens property owner calls for a nationwide boycott of amazon products. >> he thinks the country is going to boycott because he lost -- >> i haven't found out what the person's name is it's not going to be you >> i have no real estate in long island city. happily. >> you didn't close? >> i never bought. i never went to visit. still to come on "squawk box," we're going to talk about amazon and what has been a remarkable fallout 24 hours after amazon pulled out of long island city. hq2 will not be coming to new york a look at what it means for real estate prices in new york, in long island city and for investors. also the china effect. news this morning that those talks will be coming to d.c. next week. is it a turning point? and we should mention the futures have been positive as a result of that plus we're going to head back to the west coast and becky quick

for more of her news-making interview with berkshire's charlie munger a lot more on "squawk" when we return

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♪ yesterday's -- how does he -- these producers, i mean, they're amazing, aren't they

on a friday to play this song? >> thinking with their noggin. >> where's becky see? she eggs him on. doesn't help that last move looked like an -- that was an aoc move >> woke to the woke. >> here we go. ready? >> that was it oh, my god, that was exactly you're seen that going to put that on a loop. going to do that side by side. let's get to -- how you doing? >> good. >> looking good. yesterday's decision -- we'll bet back to becky in a minute. yesterday's decision from amazon on bezos pulling out of -- >> that's the third time now >> -- from new york is sending -- you get that? that's what the post should have used, right? sending shock waves across many sectors including real estate. robert frank joins us now with

more >> yeah, well it was the real estate gold rush that yesterday became a bit of a bust after amazon's decision in november to locate part of its hq2 in long island city with those 25,000 jobs, local real estate explo exploded between the announcement in november and february 10th, there were 135 contracts signed. that was up 181% from the year ago period now, over a half a billion dollars of commercial space and multi-family buildings were sold over that same period. prices went up, informsers and speculators and even amazon employees fought bidding wars to buy houses and condos. as manhattan prices have kind of stalled out. now those apartments may be harder to unload especially since there's a larger pipeline of new condos that are in the planning or construction phase now, real estate agents say some of those deals that were headed to contract have gone dark no shares of realty which have

the new york president were down some say long island city which was already really strong and kind of booming before amazon will probably recover quickly. residents being priced out of brooklyn are all headed to lic and some say the publicity could help because it highlighted what an attractive market it is >> thank you for that. you brought your friend along. >> i did >> you want to introduce him this is like a big moment in real estate land >> yeah. >> we have a tv star here. >> he is a star. he's also -- his team is the top team in new york city for brokerage. and he started his career in -- >> long island city. yeah >> we should say he is the managing director of nest seekers international. one of the agents on bravo's "million dollar listings." >> good morning. >> good morning.

>> was it an exhausting day yesterday? yes. i'm actually surprised you convinced me to be here. it was a lot we put i think 15 different apartments into contracts purely speculative base ed on the amaz move and all to have those buyers said can i get my deposit back is there an amazon contingency in the contract, what did i do >> i don't think i'm sympathetic for those folks. but we're going to have an interview on with the man that killed this deal in the next hour >> oh. can i stay for that? >> you can he's going to say there are cranes all over long island city that it's a bustling, thriving environment that did not need amazon and even without amazon things are going to be more than fine >> yeah, whatever. >> you're saying whatever. tell us. >> i mean, that's -- listen. that's like going back a couple

hundred years ago looking at new york city and that part of the city as a farm saying, you know what this area is bustling. stop with the industrialization. let's go back in time. i want that guy to come in here and i'd like to stay for that guy. >> can i ask what your political leanings are >> sure. i'm independent. i would like there to be as much growth for the locals here and for the international community who loves new york city. and who loves the education system and loves the infrastructure all they wanted to do was bring jobs at the end of the day they wanted to bring 25,000 jobs they wanted us to spend billions of dollars here. and over the course of time, they wanted to spend billions of dollars in compromise. >> what do you think the ramifications are long-term when you think of other business owners, executives who are thinking of locating in new york do you think this will have an impact or is this a blip along the -- >> at the end of the day, it will be a blip

what i think it'll do that will be good is i've always loved long island city like we said, i started my career there i was taking the 7 train from 42nd street to long island city every day in 2008 and 2009 when the market totally crashed in new york city. because everybody said i don't know what to do with my money. i don't want to rent where can i go get great value i only know it because of the pepsico sign. >> a big argument earlier this week was that subway line you're talking about is already overtaxed. people in queens they have leaf lets out, three to five more all over the borough not even the immediate area. the locals feel it's going to ruin the subway system they don't want the development. what could have been done to better sell them on this being long-term to make short-term bad? >> i didn't stop new york from the extngs of the q line on the avenue we didn't get rid of the upper

east side. everything is going to be okay i remember doing deals in 2009 and they were so angry about it. and i just resold an apartment that i sold for $900,000 in 2009 in october, so before the amazon announcement, for 1. million >> who gets hurt there there are a lot of companies and people who bet on this >> everyone understands the definition of a boom is a sharp increase from a normal and booms oftentimes can go bust but i think the developers in order to build rental buildings for 25,000 strong, smart workers who are making good incomes those people are now going to have to find new people to rent to now there's all this space that

amazon isn't going to fail >> so here's the question. you know, this morning, all the papers are giving prime suspect, had an ax to grind with governor cuomo. the idea being that these political leaders are going to be blowback against these political leaders for pushing amazon out on the other end, people like aoc are claiming this as victory. >> sure. >> two years from now when there's going to be elections for people like this, will voters in long island city say you represented my constituency well, i'm glad you did this and our economy is doing just fine, thank you? or are they going to say, man, was this one of the great mistakes of all time >> unfortunately, i think it will be the former and i don't think that's right the amazon boom can happen too quickly. no one was able to understand the benefits that that many jobs to the area would have brought to the locals.

>> i think that's sinking in right now that it's really gone and it really is 25,000. i would look at it as not just the long island city politician. >> state of new york >> even beyond that. i look at this as sort of pulling back the facade or the curtain on liz warren. i do this is what you get when you don't just talk the talk all these ideas that seem so -- that have so much merit and you actually see the end result of what happens to some of these ideas >> yeah. >> i think this is incredibly -- a watershed moment >> i think that -- listen. as far as real estate goes and the real estate investment community and the owners, the families who live in long island city with three kids who go to school in the area they put long island city on the map as an amazing place to be. and amazon isn't coming to long island city because of amazon's choice they wanted to bring a lot of jobs and money to the area and new york said, no! we don't want that

we can't the area is too good already you're going to crush us. >> there s there now a thought it's closed for business but the broader new york city real estate market could suffer especially with the deduction issue coming on. >> the entire tri-state area relies on this growth. >> do you feel this could add more pressure to a broader new york city market definitely manhattan that's already under pressure >> i don't think so. i think it would maybe make the area cheaper for other companies to come in they could say, we're going to pull out too and you'll have landlords say no, it's fine. >> i can't imagine you'll see any kind of subsidy offer for any company in the next couple years as a result of this. no >> the incentive program offers a couple of thousands of dollars per head that incentive program was a billion of the $3 billion figure we're talking about.

amazon would have been the biggest to tap it so far >> yes i think you'll still see that. more than anything the exposure has been great even right now, we are sitting here talking about it. it's been a doum minutes we're still talking about it and talking about long island city real estate when since november ever have we spent this much time on television talking about that >> what about mayor de blasio? is this a win for mayor de blasio is this a loss for mayor de blasio remember he brought them here and then managed i thought very strangely yesterday to say thank you for playing and good luck to you after trying to draw them in actually hit them on the way out. >> you know, de blasio is an interesting guy. i don't think he necessarily knows exactly what he wants every day. i think he plays to his twenties and if the like him, he likes pit it's unfortunate i think values have been great and still inexpensive.

>> what's the average apartment price in lic versus manhattan? >> a couple hundred dollars a foot less. >> andrew, anywhere else other than manhattan or new york city could de blasio get elected to anything and nothing will affect him here it's staggering that you've elected him twice already, okay? >> i'm not going to defend the mayor. but i don't know if we could -- >> but he's very -- i mean, he's not your -- you know, you have to go -- you might have to go all the way to the other coast to get to another place where -- >> indulge me for a second i think we can run a full screen i want to tell you about this quote. this is a spokesman for amazon explaining why they ultimately decided to leave the city. now, i want to get your reaction to this. it's a spokeswoman, i should say. she said, looking at the opposition and the timeline, we decided we don't want to work in this environment in the long run. meaning that the environment was so inhospitable to them, the idea there were going to be

people -- it would be like moving into a neighborhood and having people picketing outside of your house who hates you. and who wants to work in an environment where that exists? even if the majority of the people and the polls suggested the majority of new york wanted them there >> 100%. the saddest part of all this is how we weren't able to come to some sort of compromise. it wasn't a hard set in no it was we couldn't figure out a way to make it work. that's what real estate deals are all about. it's how can we make this work for everybody. >> if the stake holders in that community felt they were more involved in this, wasn't just given to them saying it's done >> i think so. if people had gotten together and said these are our issues, let's figure out how to make it work were we in the room? we weren't i think when you put great people together and figure out a way to make things better for everybody. instead of just a few people standing on the box saying no, no, no vote for me because i'm doing what's right for you even though you don't know what i'm doing.

that's where you have in disaster mode. >> are you going to tape any more when are you taping next >> "million dollar listing"? >> yeah. >> taping now. season eight >> have you heard the expression we coined tea. andrew has become woke to the woke this is what happens when you're woke now you see what happens when you woke. >> can you sleep to the woke >> no, no. this is good ate th now you're woke to the woke. this is what happens when i'm woke i should have known. 7pgñóo

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check out marks. futures are moving higher. we were down a couple of hours ago. i guess with more positive headlines on trade we've been talking about this morning, the dow jones now implied to open 66 higher nasdaq up by 12. >> been a bit of a turnaround. we think this is because of china though >> i mean, it's not amazon >> it's not amazon is it government shutdown? no >> the cpi, the ppi were weak, but nevertheless, better import/export numbers a few nights ago and positive trade talks

>> we're talking about 30, 40 points at this point anyway, the amazon news broke yesterday during the daily journal shareholder meeting. it kicked off a huge debate as to whether states should be offering incentives to lower corporate investments. and becky has more munger doesn't understand all the fuss and says new york blew it >> hold on one second. he says new york blew it and you can listen into his deeper thoughts on this entire process as it plays out develop ahead. listen in. >> we've had states doing this kind of thing for a long, long time and by and large, the states have been wise to do it. >> the states that have wooed companies? >> yes, it's been smart of them to woo outside companies to come in and of course, it will go in

time to excess our system. no, i don't worry too much about it it's an utter phenomenon of nature there's hardly been anything like it in the history of our country. and very talented driven people. and i would not have predicted this happened. and now that it's happened, i wouldn't want to predict that it was going to stop either i think it may run a long way. >> just back to the idea of whether new york created a big problem for itself i was just thinking about it in terms of the new tax laws that are there. and the blue states. the salt states have lost a lot in the new tax legislation it's basically punishment from the government for having such high local taxes because you can no longer deduct those on a federal level. new york's going to get hit with that you combine that with the idea

that it's not just wooing amazon, but the message they send to the broader business community. could a state like new york or someone in the northeast region really have shot themselves in the foot with a double whammy? >> tlar number of places that have shot themselves in the foot connecticut. california new york city. it's been serious. and driving rich people out is pretty dumb if you're a state or a city and the idea that you're going to help new york by driving the rich people out, of course it hurts new york and of course it hurt connecticut. that real estate in connecticut, down 50% in value. they've driven out all the rich

people and california is doing the same thing. i know a lot of rich people who left california. i think it's really stupid for a state to drive the rich people out. they're old. they keep your hospitals busy. they don't burden your schools the police department, your prisons. they give a lot. who wouldn't want rich people? i think florida and hawaii have both been very smart in the way they've recruited rich people. and i think connecticut and california have been stupid. >> do you think the country risks some of those same stupid policies if you tax -- >> some of the people in california are so anti-growth, they like driving the rich people out >> that's not my view, but you can understand why some people think that way >> some of those people would be the politicians we've heard

about. when i asked him which politicians he admired, he says he's not ecstatic about anybody. business leaders, that's another story. in fact, we followed up on this amazon conversation we've been talking about all morning asking him about jeff bezos we'll share that wu yo in the next hour, guys. >> that's incredible, becky. what munger just said there. i mean, no one would say -- i mean, he says they don't burden the hospitals, they give a lot of money >> he's incredibly logical and he has no qualms about saying things that other people might think twice about saying old people don't burden the prisons. they give very generously. they keep the hospitals busy they don't use up your school resources. he says you should want them around >> all right we'll see you again, beck. >> i'll tell you

i agree with it 100% i think the aocs of the world is going to take that video and turn it around in some other way. >> go for it take it, try it. he's got a point and he's not afraid -- 95 years old. he's got nothing to lose >> i'm just suggesting -- >> they're going to say he's wealthy, of course he's going to say that so be it >> okay. >> you guys, there was an issue that was raised -- >> let's check the markets right now. i'm joe kernen along with the new and improved andrew ross sorkin >> woke to the woke. >> and kelly evans the futures right now are indicated up 68 points now after different times being lower and then higher and back to even and now up about 68. nasdaq indicated up 15 or so the s&p is up 6.32 treasury yields at this point are -- actually went down yesterday on the retail sales

numbers. the yields themselves. >> we got some breaking news on the u.s./china trade talks white house saying a short time ago that detailed and intensive negotiations led to progress between the two sides this week and negotiations will continue in washington next week. the white house statement says negotiators in china focused on long-term issues like forced transfer of technology and the two sides also discussed china's pledge to buy more u.s. goods. futures now pointed higher by about 77 points on the dow for the open amazon breaking up with new york city and it happened on valentine's day. the company says it will no longer build a second headquarters in queens contessa brewer is live in long island city this morning with more >> reporter: you know, this was supposed to be the largest economic development deal in new york state history governor cuomo found a way to incentivize. but that infuriated local leaders.

>> we were subsidizing those jobs the city was paying for those jobs frankly if we were willing to give amazon -- if we were willing to give away $3 billion for this deal, we could invest those $3 billion in our district ourselves if we wanted to. that was a sticking point for neighbors who disrupted a victory news conference yesterday. >> where are you going to get that revenue we're losing? >> reporter: political insiders say the opponents' real aim may have been to get amazon to sweeten the deal and instead it just walked away from the table. >> i think it's premature. it's kind of shocking, to be honest with you. i feel like somewhere it was a

gap in communication on both sides. >> reporter: it may have been the fast tracking of this deal that led to the downfall that local leaders wanted to talk about the impact on transit, schools, real estate prices and joe, i heard you mention this arlier. now you've got a local businessman who says i went and invested a million dollars on the news that amazon was coming here where am i going to get that money back they're trying to spark up protests outside of amazon's bookstore in manhattan today >> we've been talking about how six months from now how we look back on it but this is just sinking in. i think at this point, contessa. and all the ramifications are being considered we've got a special guest to get to >> thank you, contessa we should say the man that the new york daily news is calling an amazon killer this morning. here's the paper we're going to show it to you on the screen "the new york post" calls him the prime suspect. voters simply know him as new

york state senator michael gianaris this is what he said when he joins us on wednesday. >> the deal is so bad right now that i can't fathom that's going to have a productive negotiation. rather than showing they can be responsible neighbors that would help the community that they're going to join which is overdeveloped. they're busy threat tong leave they're doing the typical amazon tactics. >> you would consider it a victory if they say forget it -- we're going somewhere else >> absolutely. >> he is now back with us on set after 24 hours of headlines. good morning to you. thank you for coming in and being with us. >> thank you. >> today do you consider this a victory? >> i don't consider it a victory or a loss. i consider it me fighting for my community. i think this is an important inflection point for the country. we have to talk about these aub

si i did contests that are out of control when amazon which doesn't need the money is squeezing the government for billions of dollars just to show up, we've got a problem. we've got a problem that europe recognizes this is why they don't allow these contests incentive programs are one thing if you're helping one that wouldn't go without them or you're incentivizing in areas that are distressed and need that economic activity to survive. that's not what this was >> i want to get into the philosophical debate and the real debate also because it's not just a fiphilosophical one. but let the just ask you this. was your approach part of a negotiating tactic or was your approach one in which you really did not want them to come >> you have to play to dance amazon never showed itself willing to talk in a real way

about what was necessary for that community we talked just on wednesday about all the things that are happening in long island city without amazon there and the stresses on that community they never came to the table and said anything other than we want this deal the way it was negotiated in secret or we're going to leave. >> let me just ask you a question i want to show you what a spokesperson for amazon said in terms of why they left they felt they were being demonized. they felt they were walking into a neighborhood where they had been asked to walk into a neighborhood they thought they had a deal and then of course there were lots of people including yourself who said we don't want you it wasn't, look. we'd love to have you when we want to figure out a way to make this work. it was a lot of people saying these companies are evil the statement from the amazon -- >> not my words. >> but the statement from the spokesman effectively saying that they didn't want to go forward with a project in a state where the timeline that we decided didn't work in this environment and they didn't want

to be there in the long-term meaning the environment was too toxic. >> they and amazon particularly has to get ahold of what they mean to what they mean to communities and act responsibly. if you look at south lake union, delltown where amazon has taken over that city and look at what it's done to the surrounding communities. there's all this talk of how the local businesses will succeed. in seattle they're dying they go home at 5:00, no one's having dinner in those restaurants. >> look -- >> when they come in and take over a community like that, the community dies >> i am not going to suggest to you that there are not issues in san francisco, in seattle, in all sorts of places much of which i would suggest to you is the responsibility of the political class to try to figure out housing and infrastructure, if you will for all of these things the question i have for you, it's a binary situation now. the question is, do you feel

responsible for that >> i feel there's a lot of people responsible most notably amazon who refuses to behave like a responsible corporate neighbor if you want to turn long island city into what happens in those towns in seattle i mentioned i want to -- >> is 25,000 jobs not helping a community thrive >> where are they going to live? where will their kids go to school how are they going to commute? >> what i don't understand and i'll go back to the math we talked about earlier we were offering an incentive, a subsidy. aoc said somehow this $3 billion magically now could be used for something else is there a financial illiteracy problem in queens today? >> $500 million of it can be that was the cash grant. that can be redistrirected >> make sure people understand that $500 million was the only grant portion of this. $500 million the rest was incentives.

>> right >> put this on the table >> i was never unclear about that >> again, $3 billion of incentives the idea was $27 billion back. let's say that $27 billion cost $10 billion in additional infrastructure spending. let's just knock it down to $17 billion. i'll knock it down to $15 billion. who's the winner in this it is so obvious to me i struggle with this math. >> i can tell that you're struggling, but this is not taking place in a vacuum that takes us off the end of the cliff. why not give them $10 billion in incentives if you think you're going to get $25 billion back? >> because we didn't >> we have to stop the madness of -- >> let's get woke to the woke which is to say you can win the twitter war. i appreciate it. you have won the twitter war the real war is about real jobs, real people. what i want to know is who is going to create the kind of

revenue that amazon is -- >> google. >> google is coming? >> the same place where any revenue -- >> you don't look at this as one of the great missed opportunities for your district? >> i look at this as -- >> for a decade -- for decades this city and this state have been trying to find an anchor tenant for that area to build something remarkable around. you can tell me there are cranes everywhere in long island city and ki tell you that taxis and taxi parking lots are all over long island city and you tell me which is a better use for the economy there. >> if it's done intelligently and it's done in a way that's planned for the people that live there and are going to live there, of course we want responsible growth this was irresponsible growth. there was not a single consideration for what is going to happen to that community's infrastructure. >> do you have any misgiving about how you approach these

negotiations >> no. no >> to say if i could go back in time, i wish i had done it this way. boy, i would have loved to get amazon here. maybe i could have eked out other concessions without demonizing them in the process which obviously, you know, what neighbor wants to live in a neighborhood where they don't want you >> i don't know how you've -- maybe i know how you folks can do this. you defend a company like amazon -- >> i hate subsidies. >> beyond those for a moment who sit there and their actual strategy is to shakedown governments and threaten them. do you not see the danger in that let me finish. >> but the only governments that can be shaken down are the ones that have screwed things up so badly that no company in their right mind would go open a headquarters there unless they got subsidies. >> that's not true >> that's absolutely true. >> this was a contest. >> i know it was but who else would pay new york -- why do you think everyone else is leaving new jersey and new york? and charlie munger just talked about california people flee --

>> there were over 200 applicants for this contest. you're saying there are 200 governments that screwed up so badly? >> amazon should have picked a place like north carolina, more friendly to business. >> you do appreciate they thought they had a deal, right they had a hand shake deal with the governor and the mayor if i made a deal with you and i thought i was being welcomed into town then all of a sudden i was told, actually, this deal is no good. what would i do? >> what you've got to understand is there's a way government functions and it's not one person deciding for everybody else >> again, we can have a philosophical conversation about -- >> this is more than philosophical. >> here's the philosophical piece of it. i absolutely agree with you that i wish there were no subsidies for countries across the country. i've actually thought it should be outlawed. if you're a true progressive, it creates a real problem because you're not really creating a level playing field the areas that have weak

economies and weak education systems are actually going to be hurt even more because they don't -- won't even have the opportunity to provide such subsidies. >> which is why i said earlier there's a place for incentives to target the right places and locations. but this is not that this was the opposite of that. >> a $1.2 billion of this was refundable tax credits only if they created 25,000 jobs by 2028 contingent incentive for any company who adds any job in queens. and only $500 million was a capital drk. >> only 500 million. >> yeah. >> we can't find two nickels to rub together for the -- >> to be clear the biggest chunk of this was only going to be award fire department they created 25,000 jobs >> yeah. the incentive programs were based on performance, yes. but there was a large chunk of it that is not insignificant that was a straight up cash grant. >> so if we have the same conversation together in a year from now, in two years from now,

do you believe that there will be a large brand tech company or other american company that is going to move into long island city and what does this say to other owners thinking of doing business not only in long island city but new york given your comments and mayor de blasio's comments basically saying good r riddance >> i hope they're coming because they want to not because they're paid here. >> you need reverse -- since you have reverse subsidies, it's systemic in new york and nurgetss you need subsidies to offset. >> what we really need to do is look at the whole thing of doing economic development the managing director of bdo said this was economic

development malpractice. he's not wrong >> i'm not even disagreeing with you on that. i don't know if this is the hill you want to die on >> i don't know if we're running out of time because i hear the music. but this process used in virginia versus the process here made a significant difference in the outcomes it wasn't just process it had a substantive outcome >> how much of that was about ego? >> zero on my part zero >> okay. it's very good to see you. we appreciate you coming in especially given the news. and we hope to talk to you more about what is a debate i imagine will go on for a long time our amazon coverage just starting phil murphy coming up at 8:30 eastern time making his case for newark to get the hq amazon not saying it's going anywhere else right now. also congress woman carolyn maloney will be here. >> this is me. i don't know if i can -- watching you in action, andrew i'm just -- my chest is out so far. i'm just swelling with pride i am i don't know what happened if that's not enough, we have a

rare and exclusive interview with berkshire hathaway's charlie munger becky's out in l.a. with that story. becky, what do you have for us >> we've actually spoken with charlie munger about jeff bezos. last year at his annual meeting here, he called jeff bezos ferociously smart. we'll tell you what he said this year when we come right back stay tuned you're watching "squawk box" here on cnbc 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. endla wealth of oil........ and riches beyond your wildest dreams. there's a place where you can find all of this. in a suite of commodities-based etfs from aberdeen standard investments.

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welcome back to "squawk box," everybody. i'm becky quick. i'm in los angeles where i've been speaking with charlie munger

he talked to shareholders here at the daily journal annual meeting about just about everything under the sun we got to talk to him afterwards and talk to him about current events happening just this week the national debt clock passed $22 trillion. that did not escape the notice of charlie munger. you worry about the eventualties of a growing national debt >> i don't worry much. a great nation in due time will be ruined. >> that's not very optimistic. >> where is rome where is britain they all pass. and so our turn is bound to come some day i don't like thinking about it too much it's like my own death why should i enjoy thinking about it but is it coming some day? sure, of course it is. >> but you have no guess as to when >> no. >> there are a lot of things that munger is much more optimistic about one of them is what business leaders in corporate america are doing right now.

charlie munger has been a fan of jeff bezos for a long time last year he called him ferociously smart. bezos is on the front page of newspapers daily not only for amazon but also his personal life i asked munger if the political landscape will be more difficult for bezos and the company from here there are some movements in washington that push back against him. whether because he's the owner of "the washington post" or whether it's just one company getting too big and regulators worrying about that? >> my guess is he still has a long way to go up >> you're a lawyer too. >> was >> well, once a lawyer, always a lawyer, correct? >> not really. that was a long time ago. >> what do you think of his moves he made recently with the owner of the national enquirer to say they're blackmailing me

they're extorting me >> i like people that confront problems head on so i'm -- i have no quarrel with confronting the national enquirer to the extent they behaved badly. and he's objecting vigorously, i'm all for it. >> as i mentioned at the top, munger is optimistic about the outlook for the united states. he's also been a long believer in china's potential in fact, he's invested a lot of money in china coming up later this morning, we'll talk about whether the trade war has dimmed his outlook for chnds stoinese stocks back over to you >> all right, becky.

i want to start doing that when people ask me things if a one-word answer is going to do it, i'm not going to be afraid of the dead air or anything else. because it's not my -- >> you know what the secret is >> what? >> the secret is with charlie and it took me a long time to figure this out of years of doing interviews, with charlie, if you just wait if you wait and sit back, he will follow up and tell you his extended thought the secret is learning to shut up and that is tough for those of us on air. you want to fill off that dead air. that's the hardest thing sit back and wait. >> i know exactly -- yeah, it is tough. for any of us. but it takes a lot of patience and you know that a two-second pause on tv is like -- feels like a 30-second pause in real life >> the first few interviews i did with him, i stepped all over him all the time i learned finally, shut up and let him talk >> he's so funny though. i could hear him talking and somebody would be like, you

can't say that and he's like, so sue me and he was a lawyer. so you used to be a lawyer, he goes yeah long time ago. he wouldn't cop to being a lawyer how does that make lawyers feel when he acts like that it's funny, isn't it >> it is it's fun it was really fun to watch him for two hours with the annual meeting. yeah >> excellent all right, becky thank you. have you been watching the show today? isn't it something >> i have. i've been plugged in watching every single thing >> it's really amazing i feel like i -- there are going to be times where i coast now. really just andrew, take this for me. >> we want shirts that say kernen/sorkin 2020. >> woke to the woke. coming up, open for business amazon -- it is unbelievable wait until this sinks in 25,000 jobs. killed the golden -- the goose that laid the golden egg amazon closing the door on new york for a headquarters means many see an opportunity to poach

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welcome back to "squawk box" this morning take a look at futures as we speak. let's show you what's going on we are near the highs of the premarket right now. 40 points higher nasdaq up about nine points. s&p 500 up a little over 3.5 points as we just got the news out of washington about china and whether or not we'll have a deal some people taking it positively some less so coming up, some friday breaking economic data the latest look at import and export prices when "squawk box" returns in just a minute who says our bank isn't tech enough? everyone, look at your phones. the design thinking, the digital engineering, security, blockchain, and we will be first to market!

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♪ welcome back to "squawk box" let's get a check of the futures. dow 50 points to the open. how about the 10-year yield as well this benchmark one, of course. it's telling us a lot about the direction of the economy

2.675% as we await that data rick santelli standing by in chicago. the inflation trend lately has been to the softer side, right >> absolutely. it definitely has not been running on the hot side. it certainly seems as though the cycle peak for the moment is in the rearview mirror. of course it's good to get caught up on the -- here we go february read better than expectations 8.8. we were expecting a number around 7 that follows an unrevised 3.9. these are for the month of january. import price down double kpngss. down 0.5%. and if we look at import prices ex-petroleum, down 0.7%. and if we look at them on a year over year babasis, down 1.7% the other two metrics are a bit more than we anticipated and if we now flip gears to

export price month over month, down 0.6%. we were expecting close to unchanged. sequentially, follows an identical down 0.6%. year over year down 0.2% all the pricing metrics are lower which really dove tails exactly with the original question it certainly seems as though pipeline pressures on a variety of fronts are easing back a bit. we know that petroleum energy's volatile that's also easing back a bit as we hover with the crude in the mid-50s. maybe the big feature today isn't so much treasuries which are compacting in tight ranges but the dollar index another over third of a cent higher this morning as it goes into the weekend with the 97 handle which is very unusual and reflects strength. do d.o. keep in mind was the high for 2018 that carried you back from the november crest at that level into the summer of

2017 kelly and the gang, back to you. have a great weekend. >> rick, if you can, you know the tea party? the rick santelli tea party? you coined that term we're trying to do it again with woke to the woke #woek #woke to the woke. a lot of people are waking up to what woke really means it might not be as much of a walk in the cake how can i say it how do you describe your woke to the woke >> andrew thinks he's having a midlife crisis >> i don't know what's happening. the world is just -- >> it's upside down. >> for me it went upside down yesterday. it did >> people are writing i'm beaming. >> i know. i'm worried this could be an idiosyncratic moment >> i was thinking that i could count on you from now on >> i don't want to suggest that -- >> you know why you're so free to express everything? i've got nothing to add. nothing to push back on. let's get to our next interview.

amazon canceling its move to new york city. senator michael jgianaris speak to us earlier. >> this is not in a vac kul. why not give them $10 billion in incentives if you get $25 billion back >> because we didn't >> you have to stop the madness of saying -- >> let's get woke. >> all right now leaders in neighboring areas are attempting to step in. one of them, new jersey governor phil murphy. he issued this statement new jersey is open for business and now more than ever newark is the next choice for amazon corporate office amazon now has the opportunity to join in newark's story. joining us on the phone is governor phil murphy just be glad it's me and not my

coanchor andrew that got assigned this. because you don't want to -- it's like a buzz -- i'm watching politicians just walk into a buzz saw >> as a new jersey resident, i'm blessed by that. >> i want newark so bad. i think it'd be so great it's the perfect place but governor, one of the things that i think we've talked about and this is where you're not going to like what i have to say, but your 13% corporate tax and some of the other things that are not business friendly set up the same situation in new jersey and it's almost like new york because of all the reverse subsidies to get anyone interested had to, you know, give them a lot. and so would new jersey. why is that? why shouldn't they want to come to new jersey? why make it so hard? >> listen. i think if you look at the history of our relationship with amazon, amazon already employees double digit thousands of people in new jersey. they're already a presence here. we have enjoyed good relations with them. and they have found new jersey like a lot of other companies to be a very good place to do

business we have the highest concentration of scientists and engineers in the world we have a location that's second to none. number one or two public education system in the country. and if that weren't enough, you've got newark which is -- i would venture to say a unique american urban story right now this is a community on the rise. it has the bones for 500,000 residents 50 years ago it only now has about 290,000. it's got a great mayor the state and the city of newark put incentives in place. we have none of the land use issues that long island city had. so there's a lot of compelling reasons for amazon to keep doing business in new jersey but also as they reconsider their strategic footprint going forward that newark should be a part of that >> short hills mall. i could go on and on in all seriousness, the -- you were a goldman sachs guy you were on wall street. >> i was

>> you know what happens when taxes get too high people leave with what's happening in new jersey right now, sometimes i scratch my head because i like you and i think you understand all this stuff do you ever second guess any of those discussions to make it hard on sort of the people that are actually generating some of the prosperity to make it so difficult on them? >> i think it's important to wake up in the morning, look if the mirror, and make sure you're in sync with who you are and new jersey is a good value for money state. nobody ever -- it never was nor my guess ever will be the lowest cost place to do business or to live in. but the key is for whatever that premium might be, you get a very rich basket of stuff back. i've mentioned scientists, engineers, location, transportation infrastructure. biggest port on the east coast number one in physics instruction. number two in chemistry instruction. number one in foreign language that doesn't come cheap. and i think companies and

families realize as long as the premium is fair, that's worth paying for >> i can't hold him back, governor i'm going to let andrew -- >> i sawant to understand when you saw the headlines cross yesterday, what the meaning to you was. is there a shift taking place in this country around the relationship between the private and public partnerships? do you think that states won't be providing incentives? do you think that companies won't be seeking incentives or is this just a blip? >> listen. i think we are proudly a pro-growth progressive state and the welcome mat is out for business period, full stop. there's no reason you can't be both there's no reason you can't say, you know what? we want businesses to flourish in new jersey and be proud, progressive heritage amazon themselves are going to $15 an hour minimum wage >> when you sit with your team this morning and try to do a postmortem on what happened here in new york and what lessons can be applied for new jersey and

other states, it is what >> the big one, may not get a lot of glamorous headlines, we don't have the land use issues they had in long island city as i mentioned, newark's got the bones to have a lot more people, a lot more businesses than it has. and that's not speculation because it once did have that. it's a city on the rise. i can't emphasize that enough. it's got a great mayor >> i appreciate all those. i want to understand what you think is happening more broadly and maybe it's just happening in the state of new york, but i think it is happening more broadly in the country where you think the democratic party is right now and the reason i ask is clearly there are many in the party that turned out to be a vocal and successful minority in this particular instance to block this particular deal and what that means longer term >> i can't speak to the national identity i could speak to new jersey and newark we are proudly pro-growth

progressive. capitalism, we're good with that but it can't be unfettered we got to make sure we manage it and we try every day to do that. we're open for business. >> i'm telling you, you know, and i know you know this but a pro-growth progressive is almost an ox si my moron, it is but i want to keep eating meat i know you know senator booker pretty well. there is a lunatic fringe on and if you keep saying progressive like that, you're not heading out to the lunatic fringe of the party right now? >> look f you look at how we've governed new jersey, we have the strictest i've signed in the nation we have a whole set of economic incentives we are developing with the legislature which i think are going to be as forward looking as any in the country. you know, we are the state of innovation and we're proud of that. we want to make sure we double down on that

and newark can capitalize on that >> new jersey's great. people think it's like the sopranos it's not what it is. it's nice. it's beautiful. >> i'm in new jersey >> you are now ridgewood, beautiful >> thank you, kelly. >> thank you, governor phil murphy do you see how it could be you go then i go and you go and you see how it could be, and roo u? >> i see how it could be depends on what day. >> think about that. we'd be unstoppable. >> unstoppable it really depends on how the world moves. we got to come back. we got a lot more from the west coast. becky quick with charlie munger sitting down with an exclusive interview and why did amazon break up with new york city? we've got new york congresswoman carolyn maloney to make some sense of amazon's ill-fated dance with the big apple and what may hpen apnext stay tuned "squawk box" will return

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welcome back to "squawk box. 91 points higher on the dow. it did follow some data, some import data i guess you would call dovish. no pipeline pressures. not sure if it's even connected to that or more of the back and forth over the u.s./china trade talks. nevertheless, 90 points higher for the dow. nine up for the s&p. 25 higher for the nasdaq all right. right now let's get back out to becky on the west coast for more of her big interview with charlie munger got about 17 minutes i'd like to see all munger from here own out i don't know if we can do more on this amazon but we're going to >> you can see the entire interview on cnbc.com. for more than a decade, he's been pretty enamored with businesses in china. in 2008 berkshire hathaway invested in byd. that's a chinese electric car

and battery maker. it's an investment that's paid off handsomely now that stake is worth north of $1.7 billion but our relationship, the united states relationship with china has obviously gotten much more tense recently i asked munger what he thinks of the trade war. >> i don't regard free trade as such a pure thing that we could never under any circumstances intervene. and i think the advantage to the united states is getting along so great on both sides >> do you think the president's right to raise the questions about whether free trade is really free and open and fair to both sides >> i don't consider it wrong to have some limits on free trade.

that matter to the united states i don't want many. i don't want them to be huge but some limits on the operation of free trade are quite acceptable >> have you changed your perspective on chinese investments to this point based on the trade talks or based on the new relationship we may have going forward? >> i basically believe in a lot of trade because i want two companies -- two countries with a lot of hydrogen bombs to be trading happily with one another instead of posturing the way we are with russia. so i vastly prefer our relations with china to our relations with russia and i think china thinks likewise and i anticipate that we will get along. it will be crazy on both sides, the united states and china.

>> byd may not be the first name that comes to your mind when you think of electric cars here in the united states. that would be tesla. but in fact, byd sells more cars than tesla charlie took a little swing at elon musk yesterday. mb somebody in the audience quoted him from commentary where he said he'd rather hire the guy who thinks he has a 120 iq than the guy with 150 thinking it's 170. he said oh, you must be thinking of elon musk >> so that's the elon musk did he elaborate at all about tesla? >> no, he did not. that came up with the mix in things that's the thing with charlie. you know, his mind is always working. he's 95 and he is as sharp as i've ever seen him he can't help himself. you know, he's a little playful. can't help but take a swing when the opportunity of a big softball coming in lands right over the plate

>> all right becky, that was great. it's been a lot of fun today on a lot of different levels we're going to keep it going now with cramer. futures right now at the highs of the session let's get down to the new york stock exchange jim cramer joins us now. i was following some of your tweets and stuff, jim. what happened -- you never know with the twitter sphere what you're going to hear what was the criticism yesterday? you had a tough day with the trolls >> i mean, what happened is i like nvidia a lot. then i said they're going to miss the quarter when the stock was 260, 280 and there were people who didn't necessarily -- even though i said that on every avenue i have i tried to see how i could have down nvidia better i said listen, you know what maybe we take a look at it then it went up. they said how could you not get right back in. and the answer is it was more

dicey. even on the conference call. but people say what they want. i don't care if it was my mom, i'd be upset >> you've been thinking about retail sales so was that a one off or an outlier? did it snap back right after powell changed his tune, what do you think? >> i think you won't really know until you see the spring season for gardening and for renovation but yeah for the most part the bloom did lift the gloom was federal reserve oriented there wasn't anyone who disagrees with that on conference calls but people say it's not possible the gloom did lift february so far pretty good. zb . >> you're a -- can i still call you a jersey guy >> of course you can i'm in philadelphia now. but i lived in new jersey for 25 years. >> restaurant holdings and all the cool neighborhoods. >> i do. >> but i'm trying -- i wish

amazon would do it, but i don't -- i kind of think if amazon were to go to newark it would be rewarding bad behavior in new jersey. >> we're number one in chemistry. >> in physics. >> we're number one in physics we're number one in everything what were we not number one? wasn't there something we were number four in governor murphy. he's proud we're number one football, we're number one i don't know he's a very number one oriented fella. number one in high taxes number one in worst municipals number one in worst pension problems that's number one. we're uber-number one. >> i guess -- >> would you buy our municipals? i'm trying to get my arms around them i like illinois. >> all right yeah >> number one. we're number one got to get the big finger wh enhe comes on next you know the big finger?

>> oh, that finger oh, that one okay thanks, jim. >> we're like the duke of states, you know we're like -- he's belichick >> thanks, jim we'll see you in a couple minutes. coming up next, the congresswoman who represents the part of new york city that amazon just abandoned when it said it would no longer build its second headquarters in the big apple, and bezos basically pulled out of long island city representative -- is that the fourth time? carolyn maloney will join us when "squawk box" continues. we're putting ai into everything, and everything into the cloud. it's all so... smart. but how do you work with it? ask this farmer. he's using satellite data to help increase crop yields. that's smart for the food we eat. at this port, supply chains are becoming more transparent with blockchain. that's smart for millions of shipments.

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welcome back to "squawk box. amazon proposed new york city headquarters no more phil murphy made his case for his state to get the amazon hq 2 project. >> i think we are proudly a pro growth, progressive state and the welcome mat is out for business, period, full stop. no reason you can't be both. there is no reason you can't say, you know what, we want businesses to flourish in new jersey and be proud progressive heritage amazon themselves are going to $15 an hour minimum wage. >> while some are cheering the news, others including the local new york congressional representatives are not. joining us is congresswoman carolyn maloney, she represents new york's 12th district, which would have been home to the so-called hq 2 when you saw the news that amazon was leaving, and was

picking up stakes if you will, you thought what >> i, along with most of the constituents that i represent, i was terribly disappointed. if amazon had come to new york, it would have made new york the high tech capital of the east coast, cementing permanent good jobs for generations to come it is a terrible loss to the city's economy and jobs for its people. >> we had queen state senator michael janaris on the show, being called the prime suspect for killing that deal. he made the case that actually it is better off for queens, that he's happy they're not coming and that they were not paying their fair share. he has a philosophical view that states should not be subsidizing profitable companies and that ultimately it would have crowded out the local citizenry in queens

>> well, i think it would have provided jobs to the local citizenship in queens. and you can be for aproject an still negotiate for whatever improvements that you want the queens ommunity, many of them were negotiating for more entry level jobs, lower paying jobs, and maintenance and security and other areas they wanted those jobs and amazon was listening and responding and planning job fairs to review people and talk to them as they moved forward. >> let me ask you, the people in your district, when it comes to voting and remembering this moment, do you believe that those that effectively pushed amazon to leave will be held to account in that way or do you think that people are going to look two or three years from now and hopefully long island city will continue to grow and hopefully be vibrant and people will look the other way? which one do you think it will be >> i don't think that voters

make a decision on one action alone. and all of the elected officials in queens are extraordinary, hard working people, and friends of mine. and one part of politics you can disagree on one project one day and then the next day you're great allies on another. we are pushing on two projects together that would help the community. one is infa structurastructure transit. we need a stop in sunnyside, queens, and we need a firehouse. we don't have a firehouse in that area that is growing. and amazon is not the only thing happening there. there is over 350 development projects that have just taken place, are being built now, are being planned for the future it is the fastest growing area in new york city but amazon was good not only for long island city, and the jobs both high paying 25,000 job

pledged, but one aspect of the statement you made, andrew, is that he was talking about the subsidy. there is no money if amazon doesn't come to new york there is no pile of money. people are talking about, we're going to take the $3 billion and build schools. amazon was promising to build schools and pay for them the $3 billion was based on revenue that came into the city's coffers because of the jobs that they created, the business taxes they were paid, the buildings that they were paid, the economic activity that it created so it was not a net loss now, i'm told, even though the negotiation was secret because of amazon demanding it, that new york beat out over 220 localities, cities and states and many of them were offering far larger subsidies in new york >> but, congresswoman, if i'm a business executive, either a business owner, ceo, thinking about relocating to long island city or other parts of new york

city, what am i supposed to think this morning you know, if the governor or the mayor shakes my hand on a deal, are they good for the deal anymore? >> well, there is plenty of blame to go around we'll have to see where the fallout is and hopefully that this won't be a red flag to other businesses coming one reason why i supported it is that for decades i have worked with city leaders trying to figure out how to diversify our economy. we're overly dependent on business services and financial services services and if there is an economic downturn we're hurt severely. we even built a school in the district i represent, cornell tech, to train tech specialists, to train -- >> go big red. >> so we were really working to diversify and targeting tech, trying to create tech zones, all kinds of ways to -- >> what do you say to the mayor,

though, who told amazon yesterday after negotiating this deal, good riddance? >> i applaud mayor de blasio and governor cuomo for having beat out 220 other localities, cities and states to win amazon in the first place. i would hope that all of us would try to renegotiate, reach out to amazon and try to get them to reconsider it would have been an incredible economic advantage for our citizens, our residents, and everyone and anyway -- >> congresswoman, we can only hope, we appreciate your time and your perspective this morning. >> thank you for yours thank you for having me on your show. >> we're not going to come in here on tuesday and, say, wow, it reversed back, are we >> maybe this is a grand dance, a grand negotiation. i don't think so but, you know what, if it is, and they get them back and get something for it, i would give them credit for that too

so -- >> you give them credit if they give amazon more handouts despite -- >> no, not more. if they -- >> why would amazon come back for less >> i don't think so. i'm just saying. we need to thank becky quick have a great weekend. >> all of that is on cnbc in the archive. >> and kelly. >> i'm sorry i said bursted earlier. >> join us on tuesday, have a great long weekend, everybody. "squawk on the street" begins right now. ♪ good friday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber. what a morning of news futures up as u.s./china trade talks will continue next week in washington, d.c. we'll see the president in the rose garden in about an hour on a budget deal, pepsi, deere, nvidia and more. the market meltup. futures pointing to a rally at the open solid week