the billionaire and his girlfriend and how much the tabloid paid for them. it's tuesday, march 19th, 2019, and "squawk box" begins right now. freeze frame we're doing this for the pictures, aren't we? who has equity futures at this hour let's take a look at where things stand in the green once again. yesterday was an up day for the markets. the dow was up for its fourth session in a row, and this morning you can see that it's indicated up by almost 100 points s&p futures indicated up by close to ten poijts, and then the nasdaq indicated up by 27. dlook at asia. you can see the nikkei ended,

well, essentially flat shanghai composite down by .2%, and then the hang seng was up by .2%. in europe there is early trading that's already taken place green arrows across the board. looks like the biggest gainer of the major averageings is the dax in germany finally, take a look at what happened with the u.s. treasury market, and you'll see that the ten-year yield, which yesterday for a while in the morning was trading below 2.6% it is there once again 2.596% >> the securities and exchange commission blasting elan musk for a series of tweets he sent just last month. the s.e.c. says musk is in blatant violation of a settlement agreement in which he will get preaprufl for all tesla related tweets the regulator says musk never sought approval for a single tweet about tesla since striking that deal and it's asked a judge to hold musk in contempt of court. according do a court filing, the s.e.c. asked tesla whether any of musk's tweets had been preapproved after more than two weeks tesla responded with a simple no.

musk has argued his tweets were immaterial and that the s.e.c.'s push to find him in contempt infringe on his free speech. >> do you think this is a situation here, infringing on your free speech when you are a ceo, you don't get to say whatever you want you've already -- you've already -- >> you have entered a settlement with the s.e.c >> that way you didn't have to step down and give up the title and do infantry those other things you have run amok with your tweeting where people lost money based on what you had tweeted on these issues if the s.e. krechlt zints come after him for this -- >> there are free speech restrictio restrictions >> you don't get to say whatever you want, at least not relating to the company there are rules and situation that is you have to abide by >> it's amazing for tesla. >> i was thinking about netflix and tom rolkers coming on. tom rogers said that -- would

never again it he was right because it was netfl netflix. you would think that if art is art and money is money, but it's not. the academy is not ready to give netflix. what i was just looking up now is i saw some news about the irish -- it's a bond movie coming out it's a netflix offering. we never mentioned how right he is going to be >> give him props. >>. >> i often think that. zwr i'm like -- i'm just happy that you care about what i think of things and try to bring me in thank you. thank you for bringing me into

the conversation >> we're friends it matters >> business insiders reporting that tesla is again asking employees to volunteer to help deliver cars a senior vp reportedly e-mailed department heads asking for help in a push from employee volunteers to deliver 30,000 cars over the last 15 diz of the quarter. employees have previously reported big delivery pushes towards the ends of the quarters >> for tesla, i'm still warned out the other day. i don't know if i can talk about tesla. >> tesla, we'll see. we'll see. >> i've always thought -- >> the thing i care about because i thits it's a broader issue where, is this going to be a toothless agency or really go after somebody who flagrantly violates the terms of the agreement? >> i'll tell you, someone who

does not have first amendment privileges -- >> us. >> what are you talking about? we can say practically anything we want. >> i don't want to say anything politically incorrect. >> you can't help it youadays. it's very -- we have no first amendment rights, believe me we don't vsh. >> you can say what you want >> i just read this it and parsed everything i'm saying here i think i can get through this netflix is saying no to apple. the streaming giant it is it will not make its tv shows and movies available through apple's upcoming video service this is kind of cool netflix ceo reed hastings says in his words we prefer to let our customers watch our content on our own service this is between netflix and apple. right? why would they they both want the eyeballs for

streaming. apple is expected to unveil a tv and video service next monday that will resell subscriptions from providers like cbs, viacom, and stars. in addition to hosting apple's own original content i love a 70 inch screen and a table for my feet and remote control. you don't need a whole lot more. >> you have a cup holder in your recliner >> for my grape soda yeah i can keep six of them right in my lazy-boy. the grape soda >> let's talk about boeing doing some damage control after the second fatal plane crash in less than five months the company ceo says that boeing is relentless when it comes to safety he also addressed the investigation into the ethiopian

airlines crash that killed 157 people >> investigation is moving forward with work underway to understand the information from the airplane's cockpit voice and flight data recorders. our team is on site with investigators to share technical expertise. soon we'll release a software update for the 737 max that will address concerns discovered in the aftermath of the lion air flight 610 accident. >> let's take a look at boeing's shares you are going to see they're down about 25 -- or about 25 basis points this morning. >> they closed well off their lows we were there at the 65 low and hit vet first day, and that helped the market dow ended up 65 yesterday because it wasn't quite dragged down quite as much >> everybody that keeps trying to compare this to the 787 dreamliner, this is different. more than 300 people have died >> the dreamliner situation, they knew what it was.

it was a physical fix. here they're not quite sure. >> that was a big benefit because airlines don't want to have to restrain their pilots. it's expensive that's where they're going to get into trouble along with the software fix, they're talking about additional training for pilots. it was raised after the first issue. it was surprising to hear that pilots weren't maybe potentially more aware of that, but the idea that they're going to have to go back and readdress and look at pilot training is a big issue, too. >> do you remember last week, i think you were out, and i was in we have the head of the american airlines pilots union, and he specifically said that its fleet of max planes had two angle of a

sensor as opposed to the standard one that's what is at issue right now. there's an input from a single sensor standard on these max planes american said that ours are safer because we've got two of these sensors. >> the notion that there's some type of friendly relationship between the faa and our producers here versus airbus, and then the faa as a government agency realizes what an important economic component boeing is to our whole economy and the dow compoen ebt in terms of price and our biggest greatest manufacturer, and you wonder, do you get -- did boeing get the benefit of the dow for regulators that's just the end. >> that's where the investigation is at right now.

>> are you going to talk about -- i would tell you something about this, melissa, because you talk about these marijuana stocks i was on your show last night. >> you were a guest -- you were hosting, filling in. >> thank you those guys all go crazy trying to figure out how to make money. i'm still thinking is this really okay? i can't get it out of my head whether are we -- they're just physical ahead i want to do this, and this one is better. they got this, so this is even better wee w he with can go faster, and even more people are going to be -- >> listen, it's fully about making money >> it is rare that there's an industry that's a wild west where we are watching the industry develop right in front of our eyes. >> 33 states in this union, joe, have approved marijuana. >> what about people driving and high school kids and all that? >> when you are a teenager, it's no way i can't believe they're -- >> totally detached about it as big as social investing is now, i'm worried about buying

something that has an oil company in it. i'm worried about, you know, anybody gets offended, kropt to buy the stock. >> hoof the people who are socially responsible also smoke pot. >> it's all natural. >> you see what i mean >> i just watch these guys all four >> to your point we can't say anything, let's see how much flack i take for that comment. >> if you're not on board, then you're, like, prohibition. >> i have never smoked marijuana. >> you never -- >> i have never ingested it in any form >> i tried it once in my entire life i didn't like it that's it. >> is that it? >> just say no >> i haven't either. >> that's growing up >> even today. >> this is your brain. this is your brain on drugs. >> i said i haven't either today, but -- >> no, no.

>> i told i went to colorado in the 1970s. >> it's assumed. >> it was all around me. i was, you know, fanning it away >> this is you with a filter >> this is me with first amendment filter exactly. >> all right we're speaking about cannabis because tilray, the canada-based marijuana maker shares soaring following a big earnings beat. the company doubling sales from a yoer ago tilray's ceo says the can p is looking to the u.s. for its next leg of growth. >> we finished the year with about 500 million in cash on hand, and we'll continue to invest it and deploy it. right now canada certainly is important, but when we look globally, the united states and europe are orders of magnitude more important larger and so we're looking to aggressively deploy capital in the u.s. and europe >> and tilray shares are up 2% premarket on the back of these earnings >> it's legal, so we really shouldn't -- we shouldn't be -- >> it's legal.

>> about everywhere. about where the companies are operating. it will sell out, and i really shouldn't be >> there's also -- >> a lot of the the growth depends on whether there's -- whether the federal government would ever step in and say the states can't do these things, whether the federal government eventually looks off on this the expectation that this will eventually be clear to legalize. >> for now even there's a big open opportunity in the cbd market, which is legal across the country, which is a federally legal substance. you know, when they acquired manitoba harvest, for instance, to manufacture cbd-infused foods and things like that, that's all legal. that could be sold at whole foods or trader joe's. >> anybody who is using it for medical purposes, toeltly different. >> or wellness cbd. >> kind of get that. >> all right meanwhile, wall street journal doesn't always have this much -- three big pictures like that these are the guys involved in this you saw some reporting already on this. >> yeah.

>> this is -- this extends the journal says a lopg piece about what actually was happening with the jeff bezos and we're learning more about that, and i'm talking about the national enquirer's david pecker, which gets all confusing, right >> as opposed to >> the pics. it's crazy >> the pics of >> the vp's of -- that we were playing the music for at the top of the show. the "wall street journal" is reporting that mieshlg sanchez, the brother of bezos's girlfriend lauren sanchez, sold the billionaire's secrets to the enquirer for $200,000. that led -- that lawyer to leave the company immediately and there's all kinds of political ramifications that we're talking

about, where once again, an undercurrent david pecker is close to donald trump who was mad at the president who is mad at the washington post and the president has tweeted how, wow, the national enquirer scooping the tabloid washington post. then we know that actually patrick -- i think it's woodsel is i think one of the co-executive chairman at wme and ari emmanuel is involved he is close to david pecker. back in the fall american media was trying to -- they didn't refinance that until january 3rd, and a few days later is when this came out >> they had the captain kill problem. that goes to michael koen and all that other stuff too

i mean, there's all these people that have all these axes to grind, and you don't know which axes are grinding at any given time you know, bezos got mad and said i'm not going to be blackmailed. if you hadn't taken pictures of yourself and sent them to meet e people, which most people don't do, i don't think, anyway. maybe millenials where, i'm not sure in my day and age, that's not something you do >> they didn't have cell phones in your day. >> bezos also -- >> you didn't have the option. >> i missed. it was a table -- >> no. >> where is my selfie stick? >> where is mine when i need one where. >> my arms aren't long enough. >> there's so many different nuances and angles >> if you are an amazon shareholder, what is going through your mind? why are you having a relationship with someone whose brother is selling information

that could be held hostage over the ceo of the company >> right the original sin is bezos put -- i'm not saying i don't feel bad for him, but he put himself in this position, did he not? >> the thing i take out of this is when everybody started thinking, okay, what happened? was this a cyber attack? did anything happen along those lines? it's the old story, it's human weakness it's always the humans if you want to keep a secret, don't tell anybody in the world. it's a secret between you and one other person, it's going to get out at some point. >> he has worked out and kind of got it going on. i'm not sure he always had it going on, like maybe in high school he falls for this, you know, i don't know -- we don't need to get into all that, but it's -- you know, it's deep. >> it was ""vanity fair."" it's my fault. "vanity fair" wherever the interview was. that was a few weeks ago >> it sort of -- amazon was one

of the most valuable companies in the world, so it's not like we're not supposed to touch this so to speak. coming up, a report card on the trump economy. the white house out with its view of the u.s. growth and a new poll that says american people are happy about it. i like that. earlier on the last show we had the white house says is defending the economy. i love that. i guess the democrats would say that we'll take you live to washington next. as we head to break, here's a look at the biggest premarket winners and losers in the dow. >> aga people know aflac... aflac! ...but not what they do. so we're answering their questions. aflac is auto insurance, right?

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america's most advanced internet. internet that puts you in charge. that protects what's important. it handles everything, and reaches everywhere. this is beyond wifi, this is xfi. simple. easy. awesome. xfinity, the future of awesome. zplienkts the white house out with new numbers on where it sees the economy headed over the next decade. elan has more. hi, elan >> hi, becky this report is really a window into the white house's world view and why the administration believes that president trump's policies are working first are to the tax cuts. the report says that real disposal income is up $640 over trend by late last year. that is a result of the new tax law. also, deregulation so far the reportings rolling

back regulations has saved $3.2 billion since president trump took office. the cost of prescription drugs is down. the white house says the price of drugs compared to inflation is down 11% from the pre-trump trip this report also lays outer the beg threat to economic growth. the white house says it is socialism. a 70% marginal tax rate on the super rich the white house says that would prooul actually result in less tax revenue after accounting for changes in behaviors and growth. their price tag is $66 billion over a decade. another popular democratic proposal, medicare for all that would lower long run gdp by 9% according to the white house. right now americans do feel pretty good about the economy. 71% say it's doing well according to a cnn poll that came out this week a weak economy could be one of the biggest risks to president trump as he seeks re-election. this report lays out their argument to voters heading into 2020 guys, they want to frame this as a have i stark choice between socialism and a strong economy

back to you. >> i was watching earlier saying what's not to like the defense of what? i saw that earlier that that was a chiron on the last report in the last hour. >> well, not everybody believes that it -- not everybody believes it can continue, right? they are defending their policies going forward and to achieve that 3% growth that the administration has laid out as a goal, they say they need to have all of these pillars in place to make that happen >> so far so good, though. you know, sub-4% unemployment. 2.9, 3.1, whatever you want to use for gdp. rising wages not a whole lot of -- you know, not a whole lot of arguing about whether it's a defense or a promotion of the poefs anyway, we'll move on. thank you. some sad news that was left me

shaking yesterday. about a frequent "squawk box" guest. economist alan kruger took his own life on saturday he served as a top economic advisor to president obama and a long-time professor at princeton. he was 58. i didn't know him well, but he was a gentle, kind man, and just whenever this happens, i wish i had known him better >> yeah. >> watching what people said about him yesterday, president obama said exactly what you thought about him. he was always a kind person, but he was always smiling. >> never said a bad word >> a lot of other people who knew him reading what they wrote yesterday -- >> talking about princeton and, anyway, "squawk box" will be right back sfx: [phone ringing]

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for. >> deon nunez. alleging that he was defamed that the social media giant company engages in the shadow banning of the conservative opinions, selectively enforces its own terms of service to benefit opponents of the republican party congressman nunez claims that it twer sought to influence his 2018 re-election race and interfered with his investigation into hillary clinton's presidential campaign and russian involvement in the 2016 presidential election the suit references messages critical of him as well as accounts whose sole purpose was allegedly to tweet and retweet defamatory statements about him.

>> imagine >> easily. >> but i was trying to think -- >> coming to -- cnn's firm $270 billion. putin would throw you in jail if you said something that's not -- this is -- you know, before we did all this social media stuff, did he with think all this through? >> the request he is this -- are they responsible for publishing a broadcasting do you have the same responsibility for what happens there? if you yank someone from one point of view and not ban -- >> if you start to edit at all, you are suddenly responsible

>> the billboard company would probably be liable if it was inflammatory, if it was something that was defamatory. they would be responsible for what was put on, because they were profiting on it >> there's fist amendment laws to offset it for whatever reason -- >> they're hell to pretty high standards. coming up, the federal reserve wrote today, and it's not expecting a right hike they say that the central bank should cut rates now we'll tell you what he said next after we head to a break, take a look at the s&p 50000 winners and losers

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welcome back you're watching "squawk box" life from the nasdaq market site in times square. >> good morning. welcome back u.s. equity futures this morning are in the green once again. you see the dow futures now indicated bip 105 points s&p futures look like they're up by 11, and the nasdaq would open up by about 29 points. >> kicking off a two-day policy meeting today. the bank is not expected to raise rates. one former fed president actually making the case for a rate cut here's arianna, comments yesterday. made on closing bell >> i actually don't necessarily anticipate the fed will cut rates, but i do think they should cut rates

i think the reason for that is that where is my baseline outlook is quite positive, i think we'll see growth in 2019 albeit slow growth the down side risks are out there. interesting because we have certainly richard fisher on last week the fed saying that we don't have any, and it's really concerning that the next will come when we're going to be at these low levels where in the past you've seen the fed respond to a slowdown by four, five, six, seven, eight rate cuts. if we do that, we're going to be negative then you have guys like -- i think he has taken a victory lap for being so dovish prior to the

december meeting, which a lot of people say that was the. do you think we're anywhere close to cutting, matt >> i don't think so. i think monetary policy is in a good place right now you know, we expect the economy to slow through q1, but overall for growth this year, reasonably solid 2.3% that should keep the labor market tightening wage growth and continuing to pick up. i think monetary policy is in a good place, and the patients were a while here. >> kevin hasset on yesterday he went back and just recited first quarter the last four or five years, and like clockwork are we getting caught up in what is just a historically weak first quarter, and will it rebound to a solid 2.5 for 2019? >> yeah.

i think q1 has historically been weak i think they have difficulty seizing the adjusting data on top of that. you have the government shutdown, which was for three weeks. you had some severe weather winter there's one-off factors. i would look at the survey data as a good view on the underleague trend, and there at least if you look at the ism composite index, there's the 11st highest reading ever in february i think it's telling you that the survey data that the underlying trend in the economy is actually reasonably good despite a slowdown in q1 >> it's not necessarily what you spend all your time on, but the next move that the fed makes will be up and down. zoo down >> you agree to some extent. >> we say down late next year. i think obviously right now the fed is dovish. you look at speeches and all the speeches very, very patient in terms of how they said where they're going to have interest rates obviously powell a week and a half ago said inflation is low it's moderate. no need to really raise rates. i think concern is that we really have about the economy

for 2020. >> lowest auto sales >> from high levels. then you look at the ten-year treasury at 259. it's pricing going forward there's also -- you think about hedging costs from german investors coming to the says u.s. hedging costs are pretty expensive. we are seeing domestic investors buying treasuries. we're just seeing yeeltds and

mutual funds over a number of years in terms of repat yags and capital investment and things like that. why are we slowing was it a sugar high, or are we importing the trade global slowdown for some of the trades? >> the global economy is weakening. you look at global manufacturing pmi's, they're weakening we're seeing live issues outside the u.s. which we think will translate -- >> are you telling your advisors, gene, though, that we've seen the best for the stock market so far this year?

i mean, we're 3% on the s&p from its highs of last year i mean, it sounds like you are very cautious and that's unusual to hear from somebody like you >> yes one thing we said, joe and i talked about it before, we are cautiously optimistic going into this year. >> that's a term i haven't heard before you get paid to say that >> why did you decide i'm not optimistically cautious? >> he. >> the market expectation. second half of the year as markets start to price it in in the 2020 recession we can see stocks coming down. >> we see it >> really? >> we've seen the data going positive >> you look at it on jobless claims, okay jobless claims tend to bottom out about 12 months prior to a

recession. we see jobless claims buying up bole out a few ploz ash where the new york stead said there's a chance over the next 12 months actually having a recession in the next 12 months yield curve is telling you >> i would be more optimistic on the 2020 growth outlook. fiscal being a key question there. if you can get a dole on a continuing resolution, get fiscal spending, you don't avoid a fiscal cliff, you do have a decent fiscal emphasis in 2020 >> you have a target, s&p for 2019 >> twice in 2019 that's about a 5% decline.

>> do you have a target tore 2018 >> mid to upper sipgle digits. >> if i'm a client of setari and an advisor -- >> you're way above your target. >> i think i want to cash out at this point >> no. >> we can see stocks >> tell your advisors when to sell >> 140 points above your target. >> sounds like you are getting cute on market time. >> the opportunity is we would start to settle out some of the sectors that have gone ahead of themselves and start to rebound.

opportunities to reduce interest rates. >> are you making a real statement. >> it's par. we're at 2832 and headed up today on the s&p your target is 2,700 not only -- not just are we not going to 3,000, but we're going down 5% from here by the end of the year >> which would match our 2019 about 70%. >> long memories here. we'll see. you could be right yesterday we had -- actually, that wasn't on the show. that was on the other favorite show julian emmanuel -- >> now i'm getting him mixed up. he is 3,000 and above. >> gave you a lot of -- i gave you a lot of props i did. >> i'm just -- >> you know -- >> i was thinking about it

>> thank you, gene >> a metal mover woel tell you why it might be worth watching palladium, and a trend that's on the rise and tech ipo's. worrying investors and may signal future underperformance stay tuned you're watching "squawk box" on cnbc measure up? a cfa charterholder does. you've worked hard to grow your wealth. make sure you're working with a wealth manager who can grow with you. cfa charterholders have the investment expertise to unlock opportunities other advisors might not see. learn what a cfa charterholdr can do for you at therightquestion.org

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time now for the executive edge we will start with the cyber attack norsk hydrosays it was sustaining a cyber attack that affected operations. the company was using manual operations wherever possible, and it was working to contain a neutralized that attack. shares up by 5 cents and a big melts mover to tell you about palladium seeing a record high in overnight trade pulling back. the risk of a ban on some russian exports is adding to supply concerns. more than half is used in catalitic converter, and that's used for batteries in cars it's up about 30% this year. it's up another 1 % here overnight.

>> has been more found in tans kneea, and they're looking for gold at the thunder tut on and looked and read that there were big dpoflts of helium, so had he found that instead, and that was hunl for them. now they're sitting on a massive supply of it it's defining everywhere else. you're not even supposed to blow balloons up anymore at birthday parties because we don't have enough helium. when we come back we're going to talk to the ceo of cyber security firm proof point, which is just out with a study that found baby boomers outperformed all over age groups in detecting phishing attacks that's phishing with a p-h they're soaring since the christmas eve market low at&t provides edge-to-edge intelligence, covering virtually every part of your healthcare business.

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welcome back, everybody. in today's squawk ceo call, we are talking cyberattacks proof point out with a study that found phishing attacks by employees up nearly 60%. that signals there is something paying off when it comes to awareness training joining us right now is gray steele he is the ceo of proof point gary, thanks for being here. when you take a look at the phishing, let's back this up first. for anybody who doesn't know what phishing is, this is somebody coming in trying to get into your company. >> threat actors trying to get somebody to click on something think of an embedded link. either way, likelihood is if

someone clicks or opens that file, they'll get infected with something. they're trying to steal something from you >> when you go and do training for employees, what happens? how much does that drop? >> yeah, so what we see is by raising the awareness of employees, you'll see organizations that have 20% people clicking through down to probably 10% so it is a pretty significant reduction. and in today's world, we're trying to help companies raise awareness of their employees being more aware at work and also at home all of that has an impact. >> i think the reality is the younger generation is just more thoughtful about what they're seeing in an e-mail. >> in terms of what you found to e-mail fraud, the numbers aren't great. >> the e-mail numbers are not great. we saw an 18% increase in e-mail

fraud. what is that that's somebody trying to get you to send a wire, do something. and it's all self-concocted in an e-mail through some form of social engineering threat actors understand it's much harder to write sophisticated code to take advantage of a vulnerability in the infrastructure versus i can socially engineer an attack -- >> so they'll scan your facebook or twitter and figure out the pictures -- so what are they threatening? how do people say i will wire this unknown party money how threatening is that e-mail >> no, it's all in context and so because they have total context about your workday it's every single day. most companies now are trying to raise awareness of their employees. they don't fall subject to these things and i hear stories every day

about these kinds of events. because it's kind of easy to concoct these attacks, we saw it raise dramatically >> how much of what you do is training like that how much is software that prevents the stuff -- >> the core of what we do is prevention we're blocking these kinds of attacks and protecting organizations from these kinds of issues. and so, you know, we have over half of the fortune 1,000 customers today. but one of the things in 2018 is we bought a company in awareness because we saw demand for our companies to raise awareness it felt natural to everything else we were doing >> thank you so much for coming in today >> thank you so much. >> gary steele, thanks coming up tomorrow, it's fed decision day what will jay powell do? and how will the markets respond? we're going to discuss that next and then later, debating the trump economy. why a cnn poll overnight could

signal promise for -- a cnn poll i can't believe they released it anyway, could signal promise for the president's re-election campaign cnedo quk x"n bo o bc

the fed kicking off a two-day meeting. trade remains a wild card for the markets and the white house. ring the bell. >> ding ding >> the next round of the s.e.c. versus elon musk is underway and the agency is coming out swinging at the tesla founder. another plot twist in the love life of the world's richest man. turns out someone close to jeff bezos and his girlfriend sold those texts and pictures to the national enquirer. the second hour of "squawk box" begins right now. good morning, everybody. i'm becky quick along with joe kernen and melissa lee andrew is off this week. let's take a look at the u.s. equity futures at this hour. you'll see green arrows across

the board with the dow futures indicated up about 125 points. s&p futures up by 13 points. the nasdaq up by about 34. and let's check out the price of crude oil as well. hitting a four-month high. opec has canceled its april meeting which will effectively extend the supply cuts made back in january crude oil is up about 43 cents sitting just above $60 at this time here's what's making headlines at this hour netflix will not license the tv shows and movies it produces to apple adding he wants his customers to view those offerings on the netflix service. canadian government is looking at its approval of 737 max jets following the two fatal accidents. the transport minister says this does not mean anything will necessarily be grounded.

emphasized the company's commitment to safe and reiterated it is investigating in the latest crash as well as continuing work on the last crash. another american brand may be in danger of disappearing ftd may go out of business if it can't meet the obligations $218 million in debt payments. and shares of canada-based marijuana company tilray are soaring in the premarket following a better than expected earnings the company doubling sales from a year ago now looking to the u.s. for the next leg of growth >> we finished the year with about $500 million in cash on hand we'll continue to invest it and deploy it. right now canada is certainly important. but when we look globally, the united states and europe are

larger and we're looking to aggressively deploy capital. >> and you can take a quick look at tilray shares up 3.5% this morning the results of the latest cnbc survey is in. the trade issue looming large this time around steve liesman has more on that >> thanks a lot. response to it from march marking down in part to global economic weakness. and the two are really seen as linked 32% said global weakness 27% said protectionist trade policies picking that as the number one threat to the expansion. just 7% say there's been no effect and how about the -- okay now we

can do the math. 2.3% is the series for 2019. that's down almost a percentage point. then back down to potential in 2020 those are the estimates at least right now. but some good news people think the trade talks with come to fruition. 79% now expect an agreement. 2% say there'll be new tariffs and only 17% say there will be a continuation people looking for the trades to obey but there is concern that the trump administration could move onto the european -- you're shaking your head like that's -- like it's a fore gone conclusion >> a rolling trade war >> yeah. >> if you read our story, art

has a strong outlook on this to take the victory from china if they could put that away. and then go ahead and move that over because it would never end as far as the markets are concerned. and all this, by the way, we'll talk about this at 8:30. it's causing response to mark down for the fed in a sharp way in terms of how many rate hikes are expected this year the trade war continues to take a toll on the global economy. let's discuss the impact now with janelle woodward and sarat sethi. good morning to you both janelle, i'll start it off with you. fed funds futures are also stacking up which steve is telling us with the expectations for a hike basically nonexistent this year. where do you stand and what role do tariffs have on your expectations >> yeah, i think when you look at it, you're right. the next movement of markets

pricing in is a cut, not a hike. i think what we're watching is certainly the outlook and the guidance on the economic data as well as what the dot plots look like and how that continues to evolve you know, we've certainly been going through an earnings season earnings weren't as strong as they were in 2018, but we're still fairly resilient what we're seeing on the corporate side is it's certainly some uncertainty, but also some initiatives looking at balance sheet, looking at sourcing alternatives to kind of close that gap and improve the outlook. >> i'm wondering if at this point in time you look at the potential trade wars that could be looming on the horizon. you look at what's going on with china currently and you think the risk here is to the downside and i ask this because i feel like when you're talking to economists, prior to a lot of the tariffs going into effect, economists were rather conservative in their estimates of the impact on the economy saying they would be extremely contained to the actual dollar

amount of the tariffs. >> if i could just insert for one second, i think the new development here is the global slowdown and the linkage that's now thought to exist between the tariffs and the global slowdown. i guess you don't put in some of the strongest tariffs since the 1930s without having some global economic effect. >> right so really is your outlook for growth -- excuse me -- are the risks to the downside? >> i think they're certainly there. and i think it's about it's not just the direct impact but also the indirect impact. it's about the supply chain. it's about the financing arm it's about how that flows through in other ways and not just the first order impact if you would have it. but we think about corporates. we still think there's opportunities clearly spreads and yields are wide to capture this uncertainty we think if you stay short in some of these sectors, there's still some good opportunities out there. >> sarat, what's your view >> so my view is once we take this trade war off the table and

you look at direct companies affected by this, industrial companies, home building product companies, all of them have a really hard time forecasting what their earnings are going to be in the third and fourth quarter. now, if you take away some of that and say what my input costs are, that relates to the consumer and what the cost is going to be. you'll see some expenditure there that will drive the earnings growth. >> there's uncertainty going down the chain >> it starts with the industrial companies, then the consumer and says what do i want to do and where are rates going to be? i think if you get that with rates stays where they are, costs coming down, certainty whether it's a gm. those companies can actually project earnings growth which they're not going to do now because they're going to be conservative we know what happens if you actually overpromise and underdeliver your stock gets killed companies are going to be very careful because we know the slowdown is coming

so where do you want to be in that >> i also wonder to the extent of which there being an agreement you can put the genie back in the bottle i'm not sure that's the case i do want to ask a question. our last graphic i never know these crazy people i survey every six weeks how much they represent the market the market breathes a sigh of relief >> so where i would break that down is just say what's going to drive the market if you get 2% in growth, that's what's going to drive the market >> you're still holding out hope for the financials >> i am.

theoretically, they had great earnings last year on a historical basis the stocks have done nothing >> but look at one of the big growth drivers in companies to say what my input costs are. that's going to be driving some of these companies going forward. they're treating it close to book and trading at ten times. >> is that your largest? >> regionals, those are the areas that are highest >> regionals, i assume there's an m&a component >> can i just ask you, we had peter boockvar here yesterday. he said his big concern about what's happening in europe right now is that the ecb is kind of destroying the financial sector by keeping these incredibly low interest rates for an extended period of time

if you follow what our treasury market has been doing, do you have concerns that to a lesser degree that will also play out in our financial system? >> i think one of the legs of growth has been taken away when you've seen the yield curve flatten. but i think if you get loan growth back and you get these companies focused on their discipline of cutting costs which they're doing in a good way, almost 3% dividend yields across the board you're getting a 10% return on a sector that has done nothing for a couple years that's where i'm looking for the value. i think we're fairly valued on the s&p right now. so a lot of stocks are trading at all-time highs now. we're getting close to that area as an investor, where do you want to be in the next couple of years and where do you have safety that's what we're looking at now. recession comes, all bets are off. but you've got well-run companies cutting costs, good balance sheets still have deregulation. and you get a potential growth with loan growth that i think

could come with tariffs coming off. >> now, wrgs the best opportunity right now in fixed nm >> i think the same thing. as far as balance sheet growth and i think we like the lower portion of the investment grade. where you can capture the curve. even though the rate curve is one of the other things. it's interesting when you think about where we are and look at sectors that have been beaten up in the market, emerging market, there's still some recovery and support there. >> janelle, thank you. sarat, our thanks to you as well all right. coming up, big-time business leader, bigger headlines first to a shocking twist in the love life of jeff bezos. we're finding out who supplied the national enquirer with those

racy pics and texts. thhe elon musk's battle wi t s.e.c. going to another level. we'll be right back. you.

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welcome back to "squawk box. futures right now indicated sharply higher 128 points in the dow. nasdaq indicated up 34 and the s&p -- is it getting through 2800 it's through it's a little bit above that is it actually gotten through the overhead resistance it hit about four times i don't know whether you say definitively yes the security and exchange commission blasting elon musk for a series of tweets he sent last month the s.e.c. says that musk is in, in their words, a blatant violation of a settlement agreement in which he was going to get preapproval for all tesla-related tweets the regulator said that musk never sought approval for even a single tweet about tesla since striking that deal and asked the judge to hold musk

in contempt of court the s.e.c. asked tesla in late february whether any of musk's tweets had been preapproved after more than two weeks, tesla responded with a simple no musk has argued that his tweets were immaterial and the s.e.c.'s push to find him in contempt infringed on his free speech i like the whole idea of, you didn't really mean that did you? i know that was part of a settlement but you didn't really -- and tesla the company was like, you didn't -- >> i want to see the original settlement if it's for all tweets, it's for all tweets if it's material tweets, it's for material tweets. let me see the settlement. >> he said he said something to that effect on the conference call if it was disclosed before, in fact, is it truly material at that point >> i think the reason the s.e.c. went here is they don't think he understands what means material and what's not ooitd like to see the original

settlement >> reminds me of the holligans in high school that go into the principal's office you do this again, young man, and you're going to -- and then they're like -- and then next week they're back. keep talking doesn't it remind you? he had no intention. >> he said so on "60 minutes." >> did they agree to the settlement >> yes they agreed to the settlement. >> anyway. let's find out how this could impact tesla joining us now on the "squawk" newsline, colin rusch. it is going to have impact on the stock or do we have to -- go ahead. >> i think there's an overhang on the stock there's really no benefit from this sort of activity. you know, the kind of -- the first round with this i think investors are willing to forgive. then the second round of challenging the s.e.c. and the baiting we saw on tv last year

is unnecessary and doesn't help anything you know, you see some of the announcements that got made around what they're doing with stores and back tracking a little bit and clarifying. then this sort of controversy, there's no benefit to it i do think it's begun to impact the stock and really, you know, people are hedging themselves just a little bit considering that the first part of the year is typically weak for car sales. >> if someone had told me about twitter and said this -- you can tweet about other stuff, but if -- you know, you definitely can't tweet about this if it relates to this. it's unchartered territory it's the new world i would think that elon would say, well, if it was specifically something where i was going to make a material statement about tesla, think of all the other tweets that aren't covered by that that he could argue that that's what he thought he was doing just seems like it's really -- >> it's tweeting >> i think you're right in that

we're charting new territory have to figure out, you know, how to go along the way. and this certainly is an example where we think, you know, they are doing that, trying to set some boundaries and set the rules. even though there's a fair amount of documentation in the legal code you know, the actual practice of this and application of those is happening in realtime. >> at this point, since it's an overhang on the stock, would shareholders be better off if elon musk were not the ceo and were removed to some sort of position where he's part of the company but wouldn't be in that position where he can draw the fire of the s.e.c. >> i don't think so. i think he still holds so much weight and so much respect in terms of the organization and how it runs, a vision of how it can run more effective that putting him in a different role where he doesn't have the authority to hold the people's organization accountable doesn't

necessarily help the organization i think it's important for him to stay in that seat for shareholders certainly there are capable managers but the authority that he carries i think is still important for the evolution of the organization >> so colin, the stock not doing much today maybe down a point or so at least that's where it's indicated. but below $270 -- that's all the other stuff going on, wasn't it? the model y was kind of -- it just wasn't received like maybe some of the other introductions. >> well, the model y was well anticipated in terms of the performance of that vehicle and what it was in the target markets. i don't think there was any surprise there and i think people are concerned about depth of demand for the model 3. we tend to be more bullish about that than other folks. i think we'll see that play out during the balance of the year >> they still sell the model x

it's the ugliest -- >> -- as we see those data points come out. >> i saw one yesterday the back end of that thing, it reminds me of -- what was that horrible pontiac aztec? >> i remember the aztec. they had orange ones >> you would buy that just to be as ugly as you possibly could in terms of your car. >> i like that >> you do? >> yeah. >> i guess i do too. colin, thank you colin rusch when we return, the battle between bezos and the national enquirer the world's richest man taking on the tabloid after racy pictures and texts surfaced in his love life. now there's another twist. we'll tell you what it is next sometimes, they just drop in. cme group can help you navigate risks and capture opportunities.

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we're learning more about the battle between amazon's jeff bezos and the national enquirer. "the wall street journal" is reporting that michael sanchez, the brother of lauren sanchez sold the billionaire's secrets to the enquirer for $200,000 that material includes the racy texts and the photos that bezos sent to his girlfriend the report also details a blowup

in a restaurant between david pecker and his general counsel for media. that led to the lawyer leaving the company immediately. it shows what a tangled mess this has been. there's been a huge investigation that bezos hired an investigator to look into for all of these issues. there had been suspicions that it was saudi arabia, that it was some hacking, some cyberattack that had led to these things turns out it's really just the easiest answer when you look for some of these answers. it was a person who actually was close to lauren sanchez who sold all of this. >> yeah, but he was a trump guy. >> he's a trump supporter. >> or had made positive tweets on trump >> and he tweeted about this the day it came out. >> and david pecker has had a 20-year relationship with trump. but supposedly sanchez was worried it was going to be -- he wasn't going to -- he was going to -- there was the agreement he could sell it again if they didn't publish it. if they just bought it and then buried it so it didn't come out, he wanted it to come out

which was going to hurt bezos which is his sister's -- it's kind of weird. >> he gave this bizarre interview to vanity fair a few weeks ago where he basically said, yes, jeff and lauren love each other and are working on being together i only am looking out for their best interest. but then admitted he had some contact with the national enquirer and talked about how -- the story brought up the tweet he put out that day. it's just a very bizarre -- >> i wonder about jeff bezos' judgment when it comes to his personal affairs at this point, it does affect the company, it affects his reputation if he were not the majority controlling shareholder, if it were any other ceo in the s&p 500, i wonder if there would be more questions about how the ceo's personal life is affecting the company and whether or not the company should say -- even if it's you're going to engage in a relationship, sign an nda. >> a lot of people do that. >> a lot of people that like

bezos and "the washington post" defended him in his response to i'm not paying blackmail but when you look at the agreement between him and the national enquirer was going to be, it was after the fact already. >> they hadn't released the nude pictures yet and they were threatening it i did read it and thought it looked like -- >> that made him kind of a sympathetic figure to a lot of people it's like, yeah. but he took the original -- >> he took the photos. >> cheated on his wife got kids and everything else so it doesn't redeem the -- >> no, but he definitely changed the narrative. he managed to change the narrative. back in february, we spoke to charlie munger about what he thought about bezos taking on the national enquirer. he had a rather pointed response >> i admire people who simply confront problems head on. so i'm -- i have no quarrel with

it but i regard it as a no nothing place that the world would be -- could well do without. scene to the extent they behave badly and he's objecting vigorously, i'm all for it >> again, that was charlie munger when we spoke to him on february 14th which happened to be the same day that amazon announced it was pulling its headquarters offer from new york city we're going to talk to the reporter behind the story in the 8:00 a.m. hour meantime, coming up, uber's on deck with every other name out there. should the new investor chase these stocks as we head to break, look at the futures. here we are on the dow indicating an open of 125-point quk x"ilbe "sawbo wl right back.

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box," lyft kicking off its road show will this high-profile ipo pay off for investors? that discussion is next. and the white house releasing the economic report of the president laying out an economic outlook for the next several years. but are president trump's policies getting enough credit for the nation's growth? that debate ahead. also shares of tilray surging this morning after sales double in the fourth quarter. we check out some of the hurdles the marijuana industry is facing right now re ineyohen w rk "squawk box" returns in just a moment

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welcome back to "squawk box. the futures now indicated up 116 points on the dow. the nasdaq indicated up 32 and the s&p indicated up 12. i just want to -- got boeing up here permanently just to see if it's affecting anything. right now almost unch on boeing. the s&p's at 2832. 2832 plus 12 or 10 or so so you're -- melissa, you're an expert on support and resistance are we through 2800?

well, we are by definition >> i was like what are you asking me? >> is it a successful move through -- >> how long do you stay there? >> if we looked at a year-long chart or six-month chart of the s&p, i think a year there's been four tests of 2800 >> there were four and a lot of them were failed. at this point -- and we're going to talk to j.j. about this who's coming up. but you look at the next level of resistance. we're in a band right now. >> well, certainly a surprising bounce off the december 26th low. >> if you think that we are -- 3% off of the record highs on the s&p 500. that is an amazing turnaround from the lows. >> the biggest start to a year in many, many years. the biggest start to the year for the averages but we'll see. you know, maybe we've seen the best -- what's a six-month look like what is it that's a year. >> one, two, three, four, five,

six. go back to september. >> there we go and so we're above some of those previous -- >> it's almost like december never happened >> it is almost like that, isn't it >> unless you sold in december >> but look what it did to all our sell side strategists that we have on >> their knickers were in a twist about that now they're bumping them higher. >> perfect the lyft ipo road show putting a spotlight on valuations and dual class share structure. leslie picker is here. >> you have lyft which is seven years old. levi is also going public this wier week nearly 170 years old yet both plan to debut with that dual class share structure that means lyft's founders and levi's descendents have their corporate addition making that

doesn't match their economic ownership. dual class share structures aren't new but have been on the rise one in every three tech ipos last year had two classes of shares about five times the average going back to 1980 non-tech deals showed a similar trend. now, proponents of dual class structure says the help invest for for the long-term. take facebook, google for example. but those two are more of an exception to the rule. found that companies that phased out their structures with provisions were given a premium to their book value with perpetual dual class structures. that's why paul singer as well as several large pension funds as well as investors have all been pushing lyft specifically for a sunset clause or a single class of stock. >> no reason to think google and facebook had success because of

their dual class >> no. >> correlation is not causation. >> exactly. >> they had pretty good businesses behind the dual class structure. i wonder if it -- >> although -- well, i guess in the case of amazon, he doesn't have a dual class structure. he just owns a lot of the stock. if you were a founder and you can control it, you can do things probably better for the long-term than somebody who's not. although i think it's harder to argue that if you're a descendent of a founder. >> and one of the new things that academics have been kicking around is this idea of ten-year voting the longer you hold the stock, the more voting power you get. that will incentivize holding for the long-term. and it will incentivize those who hold a 30% stake to maintain it's really hard once you own that much stock for a long time, it's hard to get any kind of activist or hostile takeover situation that would really be detrimental to you. >> j.j. kinahan is here from td

ameritrade what does this mean to hear all of these coming at this point potentially? >> i think it's great. one of the strongest things in the market the last few years is so many have remained private with, you know, our clients and our competitor's clients not having an opportunity to participate at all in great business models. as the companies become public and people participate, you're here at the nasdaq every day them and ncse bets, they look to get them public all the time >> here's my question though as a retail investor, do i want to buy into an ipo when its coming public has been so delayed. like you're just much later in the game which makes me think maybe i've lost all the potential big gains to the earlier investors. >> i think one of the mistakes -- unfortunately i think people always say if you'd

have bought the -- most people don't do thit. >> where you hadn't seen the company do that. >> i agree with that but what i would say -- where i was going is you don't have to be there day one you can let the company play out a little bit >> but this is like day -- >> day many. but day one of the ipo, it's your first opportunity to invest the other thing i think you see people always do is confuse company and business so you may love the product. that does not necessarily mean you have to love the stock >> but to becky's point, there is a point being made that maybe retail investors if they buy even on day five of the ipo or whatever, this is year ten of a company. and so therefore you're never going get that big bang for the buck

to you are at where the big growth has happened. and you're not going to be part of that initial wave >> the way the structure of companies is now and the way they get funded is much different than it was 10, 20 years ago. this is the first opportunity for retail investors to participate. which is why i think you guys are making a very valuable point. so i think that's the primary point. the ipo, i'm glad it excites people and it does. it brings new people to the market but the problem is people rush in with both hands where it should be maybe we should wait a little bit and see how these do. >> do you think we'll get the atm effect we've seen in other big ipos like facebook where you liquidate funds to put it into a

lyft or a -- i mean, a lot of these companies that are going to lyft are tech stocks. >> if you're going to do that, you might want to do it -- think in partials. if you want to buy a couple hundred shares and sell another stock, and if you own 300 or 400 shares, if you want to take some profits, go in with a little bit of a, okay, here's my downside everyone plans for things going up, nobody plans for things going down pun fortunately that's where people get in the most trouble as i said, i think going in on day one for most people is not necessarily the best investment strategy because you haven't done enough research on the company. they haven't had to put things out publicly as much yet >> let me ask you quickly, leslie's point about the dual class structure. would you buy a stock that had a dual class structure >> yes, i would. that being said, it's also going to depend on my holding period the longer i plan on holding it, the less a fan i am of that.

if i have a shorter -- we're in an environment where people have an opportunity to invest in these companies. you and melissa pointed out perhaps a long delay in getting an opportunity i think it's a bigger concern for perhaps retail trader than for some of the bigger houses that are buying big blocks of this and the voting rights matter much more significantly. >> thanks for coming in. >> thank you all right. coming up, is president trump getting enough credit for the performance of the economy we're going to talk about that as his chief economist releases a progress report. "squawk box" will return in a moment you.

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this is beyond wifi, this is xfi. simple. easy. awesome. xfinity, the future of awesome. the white house counsel of economic advisers releasing a new report ylan mui joins us with a preview. >> why the administrationdoes believe that trump's policies are working. the foundation of this all is the tax cuts the white house counts 6 million workers who got bonuses because of the new law the administration also says that the law is spurring investment in the u.s. with $600 billion repatriated through late last year. benefits are also showing up in some unexpected ways the administration says venture capital deals are $17 billion higher than they would have been otherwise. another key factor driving the optimistic outlook

deregulation there were 12 deregulatory actions for every one new rule the report also lays out what the white house sees as a big threat to economic growth. and that is socialism. the white house says a 70% marginal tax rate on the super rich will actually result in less tax revenue after you kkt for changes in behaviors and growth the price tag they put on it, $66 billion over a decade. that would lower long-run gdp by 9% now, the administration says that we are in the middle of a great debate over the merits of competing economic systems the report says that socialism would slow innovation and lower living standards back to you. >> all right thanks joining us now to debate whether the trump administration is getting the credit it deserves for the economy's current strength, jared bernstein on the center for budget and policy priorities he was a chief economist for vice president joe biden

he's now a cnbc contributor. and conrad, a founding partner at rdq economics jared, i'm looking at a -- of all places -- did they really publish is the cnn i guess went and did a poll and had to publish it, unfortunately for them it says it's 71% of the nation's economy is in good shape actually, the first sentence of the cnn article is americans give the nation's economy glowing reviews in a new cnn poll conducted by ssrs anyway, are you in the 29% that do not think -- did we find someone that's in that 29% >> no, i don't think -- look the macro economy is strong. i mean, we have a 3.8% unemployment rate. who's going to say that's bad? we've been closing in on full employment for awhile. that's even driven up wages and

we've had low inflation. so we've seen some real pay gains. as far as how people are doing, kind of going from the macro to the micro, you can still find pockets of folks who have been left behind and they're not trivi trivial. in areas of the midwest where factories are closing. trump himself is tweeting his thumbs off about those problems. as far as the president getting credit, look every president takes credit for a good economy trump inheriting positive trends he's riding them i would argue that the fiscal stimulus provided by both republicans and democrats, all that deficit spending probably added a point to gdp growth last year but as that fades and that's where we are right now, things are starting to slow >> okay, jared in the report you just heard what ylan was talking about. >> right >> and you were a biden guy, so i'm not necessarily tarring you with the current center of the democratic party at this point and one of the reasons i think

vice president biden might -- you know, if he enters he'd be the front runner is because he's not where it is. but do you think that the proposals being bandied about right now -- sectors of your party, do you think those would improve on the economy that we have right now or do you think that they would have a deleterious effect on the economy? tell me honestly >> i'm going to tell you honestly the problem is when you talk about the economy, you have to say whose economy are you talking about. we have vast inequalities. there are many proposals that i think are going to help diminish some of those gaps in wealth and income and wages and access to health care and housing. and i very much support those. whether they will then hurt gdp growth like the economic report suggests, i'm extremely skeptical about that so i tend to lean into a lot of those. >> because the gdp growth and the low unemployment and the

wage gains are all glimmers of hope for the people that you're talking about right there. and if you, you know, if you do things that i guess you just are, like, saying that don't have any effect like a 70% tax rate is not going to hurt the gdp or the economy >> correct >> okay. let me ask conrad. >> it's a top marginal tax rate. let's be clear about that. you understand that. >> i understand how it works >> yeah. there's actually very solid -- >> well, i don't know about $93 trillion on free everything. >> joe, you do know that the u.s. economy used to grow much more quickly with much higher marginal tax rates >> well, i do know that -- >> good. >> -- in the eisenhower years, no one paid anywhere near 90%. and people just like you tell me that two things holding the economy back now are structural and it has nothing to do with that >> i don't recall saying that. >> it's not having enough

immigration and not having enough productivity. that's why we can't grow past 2% so it's not the same economy where 90% marginal rates, we were rebuilding after world war ii and no one paid 90%. >> the average tax rate for years when gdp was faster than it is now -- >> when reagan cut rates he unleashed theamerican economy and decades of higher than average growth conrad, you're here to talk. go ahead >> i hate to jump into this great debate, but we have more recent experience with the higher marginal tax rates. not in the u.s. but the uk they raised their tax rate to 50%. revenues from top earners went down after they did that they lowered it back to 40%. i think there is more experience that the high top marginal tax rates are not good for the economy. but if we move away from the tax debate and talk about some of trump's measures and that tax cut, for example, a lot of people talk about it being

short-term sugar rush to the economy. i'm not really a believer in that if we look back, we had close to a business recession in 2016 we had a tax cut which is the part of the tax cut that i think was positive for the economy and 2018 was the strongest year for business investment in seven years. so that's the kind of thing we need to see to get the capital stock up to get productivity growth stronger which is something i think that should be a goal for all of us in terms of the inclusiveness, if we look at other developments in the economy since the tax cut, we had job growth that was running 180,000 per month and the 14 months since the tax cut, job growth has picked up to 215 per month. that's driven the labor market tighter. it's put wages higher. it has provided for this recovery to be more inclusive. we've seen unemployment rates for people who are previously marginalized that have come down it kind of stagnated now it's picked up to 3.5%

the labor force is now growing 1.5% >> i think we have clear evidence that policies of redistribution dampen to some extent gdp growth which keeps the fed -- i look at the eight years of the obama administration where we were at zero and asset prices got marked up as the fed tried to sort of engender a wealth effect and anybody who had assets, they did really well for those eight years. so all the talk about trying to help the people that need the most help of redistribution, all it ended up doing was exacerbating income inequality we hear trickle down doesn't work but anything short of growing a pie and hopefully the labor market gets so tight that everybody starts getting raises because, you know, you don't have to stay in a job where you make no money. that's how you organically solve income inequality. >> i think that's correct. and i think that we -- look.

we have seen the expansion become more inclusive since the tax cut. i think that's a function of the pickup in growth we've seen since that tax cut more importantly going forward i think that it's going to be positive for productivity. >> i think the powers that be -- we lost jared because of a technical reason but i think the powers that be wanted me and conrad to be able to agree >> you mean our producers. >> no, not our producers >> our apology to jared. we lost the feed conrad, thank you. when we come back, the airline ctseor dipping in and out of bear territory. more when we come back -driverless cars... -all ground personnel...

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the year of the rate cut the fed kicks off an important two-day meeting. could cuts be back on the table sooner than we think the fed kicks off a two-day meeting today. the s.e.c. versus elon musk take two the government taking the tesla ceo to task saying musk hasn't gotten approval to tweet about business like he's supposed to and the congressman versus the social network twitter sued by a gop lawmaker who thinks his voice is being stifled online the final hour of "squawk box" begins right now ♪

live from the most powerful city in the world, new york, this is "squawk box. >> good morning and welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square. i'm joe kernen along with becky quick and melissa lee. andrew is off today and the futures are -- they've been up triple digits. they've been up 125, 130 now they're up 113 or so on the dow. the s&p up 12.5 points indicated and the nasdaq indicated up 33.5 treasury yields were back up to 2.6% on the 10-year earlier today. 2.6% exactly yesterday i hadn't thought of resurgent inflation and boockvar was talking about that we're seeing so much that could actually be good because the long end, we know the short end is going to stay where it is not seeing any of it though. but a steeper yield curve will probably allay some recession

fears and allow sarat's group to do a little bit better than it has. >> all right a few stocks on the move this morning. let's check out shares of tesla. the s.e.c. says in a filing that elon musk has not sought approval for any tweets since striking the settlement with the commission they're looking to hold him in contempt of court. that stock now off by $1.50. and gm, the company is keeping quiet about its plans for its stake in lyft as the ride hailing service gets set to go public gm holds almost 36 million shares of lyft which could be worth nearly $1.3 billion. some are calling for gm to cash out and return the money to investors while others think that the stake should kept for strategic reasons. that stock is up by 27 cents boeing's safety practices are in focus after last week's fatal crash of the ethiopian jet

liner. now doing damage control on that front. phil lebeau joins us with more. >> hey as they continue to look for a cause for these two crashes. the one in ethiopia and then the one last year with lion air, no definitive cause has been reached for those accidents though clear similarities were established by ethiopian transport minister after looking at the data from the black boxes. so as boeing is trying to work its way through this investigation, work towards a software solution for the 737 maxes as they try to get these 370 maxes that are grounded back in the air as quickly as possible ceo dennis muilenburg out with a note and a video message saying, look safety is the top priority for boeing >> the investigation is moving forward. with work underway to understand the information from the airplane's cockpit voice and flight data recorders. our team is onsite with

investigators to share technical expertise. soon we'll release an update for the 737 max that will address concerns discovered in the aftermath of the lion air 610 accident >> as you take a look at shares of boeing, man, it has been rough over the last week week and one day as the shares are now trading down at $371 argas lowering the rating to a hold and in the opinion of argus it's likely to decline. the note says that boeing's management has not been particularly proactive in its response that's part of that message. they're trying to change the narrative, if you will, in terms of saying we don't know how long this grounding is going to last. but we believe we can find a solution as quickly as possible. let's see if there's any -- if that builds a bit of a floor there in shares of boeing and

gives some investors a little bit of -- i don't know if relief is the right word. but a little bit of hope that perhaps they've seen the worst >> phil, did argus go into specifics on what they'd like to see boeing do in terms of a response >> they did not. what you're looking at here -- and i'm not sure anybody knows what the response should be. partially because they're still searching for -- they're looking for the definitive cause when you talk with people in the aviation community whether it's on the safety side orb it's people flying these planes, everybody says the same thing. you've got to find that root cause. until you find that, it's a lot of we're working on a software solution that we believe will fix concerns with the aircraft is that going to be enough for the faa to say, okay, we think this software fix is enough. once it's rolled out to put these planes back in the air that's likely -- it's a little

too hard to say at this point. >> we know we're not experts on this stuff and it's hard to tell. if you're trying to figure out how long before we might have answers to this, we still don't have answers to lion and that was five months ago. >> they haven't revealed the final report they have early initial impressions from the flight data recorder but they have not released a final report and that's the key. we're almost certain that this was the cause of the accident and then you can do some comparison with the data from ethiopia most people believe it's going to be a grounding that lasts well over a month. now, that depends. it could change. it could be that this software fix that the regulators, the faa, the ntsb looks at and says we can get it back in the air. >> well, the dreamliner, when they grounded the dreamliner, that was three months, right and they knew exactly what the problem was. >> correct >> and there were no fatalities

involved this seems like a totally different story in terms of the length of the potential grounding on this one. >> if you look at the road map of the dreamliner, they knew exactly what the problem was they have suspicions and they believe there are some issues relative to mcas from the lion air crash. is that going to be enough to say -- i'm not going to prejudge there, but i think a lot of people are saying we need to see more >> phil, thank you for more on how the fallout from the grounded boeing max planes is impacting, we bring in seth kaplan of airline weekly. what does this mean? let's start with the u.s. carriers you've got united, southwest, and american who have flown some of these what is the issue for them how big of an impact >> starting with united which you mentioned first, for them it's been basically an operational nonevent for them, they've got about a dozen of these planes out of 750

planes that are theirs alone not to mention all the others that are contracted out and if you look at their schedules, they've basically been able to just replace all that flying for now. they put out on investor note last week that said if this goes into the summer, it could impact them somewhat. but right now this time of year, you have a few planes parked anyway they're fine american and southwest to greater degrees impacted southwest impacted the most. they have 34 of these planes out of 700 or so airplanes but there, too, they reached a tentative agreement with their mechanics who they had been alleging had been causing maintenance related cancellations. more of those because of the max grounding. if you look at their total cancellations right now, they're actually down today from flight aware data compared to where they were before the max grounding. so these airlines more or less will be fine the other thing, by the way, is when these airlines committed to

buy these, the promise of a more fuel efficient airplane was even more than they thought going forward than is the case today you delay a little capex if delivery is slow around the world, it's different. if you're air canada, a bigger percentage of your fleet, you're impacted like norwegian >> let me ask you, will these airlines be made good by boeing? or how does that work? what happens >> one way or another, yes and it's not usually boeing writing a big check to these airlines you know, they never disclosed the terms of these things. these are airlines that stand to order many billions of dollars in future aircraft from boeing so if you look at the past, you and phil were talking before about the dreamliner grounding, for example. again there, not necessarily boeing writing big checks. but you would see a dissatisfied airline suddenly order a bunch

more boeings so one way or another, boeing is going to have to take care of these very important customers >> when you look at canada and beyond, can you pinpoint one area where it's going to be a problem for the passengers this summer as things ramp snup. >> yeah. canada probably in terms of a sizable country where the max makes up a really big percentage of the fleet at the -- in the case of canada two biggest airlines that's especially true because it's a very seasonal airline industry there if you are air canada, you need to really run up the score profitwise in the summer because, you know, you don't make money in the winter west jet has been struggling, too, for reasons that have nothing to do with the max financially. they're a solvent airline, but a lot of impact there. there are airlines that are not going to be able to skate through. i mentioned norwegian. some of the charter airlines

and these planes run some missions they don't have others to replace them. there's slack aircraft capacity in the world so the impact here far more on boeing than on at least most airlines and their passengers. >> thanks for your time. coming up, twitter under fire from congress a gop lawmaker accusing a social network of stifling conservative voices online. is this the digital equivalent of a mirage? we will discuss. stay tuned you're watching "squawk box" on cnbc i'm comin' ♪ ♪ hold on ♪ don't you worry, i'm comin' ♪ here i come

welcome back, everybody. this is "squawk box" and we've been watching the futures this morning. things are up across the board dow futures up by 122 points above fair value s&p looks like it would open by 12.5 points, nasdaq by 35. the unprecedented tieup of the two studios is raising questions about the current media environment. and the netflix effect of going direct to consumer

joining us now to discuss what the merger means for existing fox brands and the future of the mouse -- now executive chairman of winn view and a cnbc contributor and cnbc's own julia boorstin have we -- have you, like, wiped a hillary wipe of all your previous stuff you were an nbc executive years ago. >> 30 years ago exactly next month was the day we went on the air. and cnbc started first president of cnbc cable and i can't believe 30 years has gone by. >> and we're well -- we're very familiar with you and all your work and i already talked about you earlier today. >> i can't believe it. 6:00 this morning you were loths on my oscar prediction >> i mean, you're not supposed to -- the academy is not supposed to make decisions on

the best picture based on monetary concerns. and tom's view -- well, he didn't think about anything else about "roma" or "greenbook" or -- >> "the favorite" which was not the favorite >> you weren't making comments about any of that. they're not going to give it to netflix because they're not a member of the club yet that's what you said >> i did i think all voters vote their economic interests it's not too different from centrist democrats looking at howard schultz and saying we're not going to vote for the decline of our own party and i think ultimately people will come to determine that netflix has their economic interest at shape. not quite ready to make that statement. >> but it's a bigger point that netflix is the outsider. >> not really so much of an outsider netflix has impacted the industry in so much of what we're going to see next from disney as it integrates fox is

going to be about taking on netflix. though these services are going to be very different disney is launching disney plus later this year. but that's going to integrate some of the fox assets such as national geographic. they're also going to be investing more in hulu which now they will own a majority stake of as of midnight tonight. so we're really seeing the pressure from netflix on the traditional media giants and that's one reason 'tis kndi putting so much emphasis on there. >> rupert is out of hollywood now and what a career. you've seen those at this point? >> yeah. you've got to give it to him it was one hell of a deal. they moved it through a hell of a lot faster than at&t/time warner i think there are a lot of questions around this. julia's absolutely right netflix has moved into hollywood and is there to stay i'm not sure the comparison for disney chasing netflix is where they want to have that narrative though

>> why >> i think netflix is so out far ahead of everybody else. disney plus hasn't even started. on its way to 300 million subscribers probably in the next four or five years and what disney gets with this fox deal is enormous concentration of the movie studio business. at least 40% market share. many believe it will have 40% to 60% market share in studios. >> wow. >> that leverage over the movie theaters are going to be enormous going to be the player to dig at a time terms there are they going to look to the process which has this whole windowing thing of it taking nine months before a major motion picture makes its way to hbo? or are they going to use that leverage to get some strength behind their new streaming service and do some of the things netflix are doing like

releasing to the service when they release to the theater? it doesn't seem like they're going to do that >> i would think the former, not the latter >> they can do both and they're already starting to do both. they have so much content, so many movies. they're unlikely to have 60% of the theatrical box office. so they're going to take some of these movies and put them exclusively on disney plus for instance, there is a remake of the old lady and the tramp movie. and they were original intending to release that in theaters. now they're going to have so much -- >> they're knocking things out a lot more quickly too i was looking at all the upcoming remakes of different ones that are coming from dumbo and down the line. every month there's a new movie. >> they have a lot of movies coming out and if you look at fox, fox used to release between 12 and 20 movies a year. they're unlikely to release that many if you look at the sort of sheer

quantity they have access to, they'll be able to put them on direct to streaming on disney plus and that makes disney plus more appealing. i would also say don't overlook espn plus which has only been in the market for a year but has gained surprising traction considering the kind of content they have. >> well, i think to the extent they put more original movies on their streaming service right away, the better the streaming service will do. but the issue is netflix, people don't go there for the disney movies that netflix already has. like avengers. most of the top netflix views are their original programs. and the issue is is disney going to make the kind of commitment to producing that kind of quantity of original programming that netflix has and without that, it's going to be a tougher haul. >> you're leaving out the biggest remake that i read about yesterday. pet cemetery steven king. supposedly it's much more horrifying than the original

do you remember the original >> i have never seen it. >> come on >> it was awful. it was terrifying. >> this is supposedly ten times more terrifying. i don't know if it's a universal. just in case it is, i thought i'd mention it we also want your take on this story. devin nunes suing twitter for $250 million alleging he was defamed and that the social media company selective i enforces its own terms of service to benefit opponents of the republican party no merit to that >> i don't think a first-year law student would have a tough time defending this as a defamation suit. he's a public official a lot of insulation against defamation type suits for that twitter because of the communications decency act actually has a safe harbor like the other social media companies do where they're not held responsible for the underlying

content. this reminds me of when i was on capitol hill and there was a survey of who is the stupidest senators and the one that was viewed as stupidest by the staff held a press conference to claim that he was not the stupidest senator. this is going to send all -- >> that guy's dumber than i am. >> this is going to send so many more people to the mock sites that -- twitter feeds that go after devin nunes. i think all it's going to do is get him a lot more humor aimed in his direction >> who was the senator who held that press conference? >> i believe it was senator bird from virginia. not the long-time leader from west virginia senator bird. >> the greatest line was cuomo's line where, said you got to stop lying to the voters. and he goes, you first >> this is really -- this is not the first time that this has been raised as an issue. jack dorsey was testified on capitol hill last year and he was pressed on this issue

whether or not there was bias and whether they were sort of restricting the reach of republican congressmen on twitter. they said they did a survey and there is no difference in the reach between republicans and democrats. but this question of shadow banning which is basically whether if you type in somebody's name it automatically pops up, it's a complicated one. at the end of the day, they say there's no difference. but it does seem he is drawing attention to these twitter handles that are mocking him because they've gained a lot more followers just in the day since this come out. >> it is amazing it is. if you get a hundred comments, you feel inundated and you're really talking about a hundred comments i mean, if you're in a -- you walk through a football game with 70,000 people, it's pretty easy to find a hundred people that love you and a hundred people that hate you when you're talking about millions of people

but in fairness, they asked zuckerberg, it seemed like we can't find a conservative in the area to bring in here to facebook. >> if they really want to go with the social media platforms, it's unlikely to be based on antitrust action and it's unlikely to be on data privacy. the place they could really hurt them is if they pulled the safe harbor and starts making social media companies responsible for the content on them. and the amount of regulatory productions they'd have to build in and the cost associated with all that filtering would be enormous i doubt that's going to happen but that would be the real achilles heel. >> are you willing to say comcast is in a better position than disney to go into this future i mean, you are -- >> i have no doubt comcast is going to build a streaming service that will get a lot more subscribers faster because it's

free and all you have to do is authenticate that you're a cable subscriber i think it's a very smart way to get out of the gate fast look hulu which is going to be disney's primary adult service is going to be 40% owned by comcast and at&t maybe all 40% owned by comcast with the rights they have. that's an underreported story. i don't know what disney does with its biggest competitor sitting there owning 40% of the service. nobody's really talked about what governance rights comes with that. that is a huge inhibition on the growth of what is going to be your primary streaming vehicle to transform your company. i don't really understand how that is going to be worked through by disney and nobody's talking much about that. >> we'll have you back about your oscar pick. and your final four pick you can tell us now. who takes it all no, we got to go >> my daughter-in-law is a former duke athlete. i am with duke all the way or

i'm out of the family. >> not a bad pick. tom rogers, thank you. julia, who's your pick >> no picks yet. we're about to get a front row seat on how cannabis is integrated into the local economy including all the possible pitfalls. you're watching "squawk box" on cnbc measure up? a cfa charterholder does. you've worked hard to grow your wealth. make sure you're working with a wealth manager who can grow with you. cfa charterholders have the investment expertise to unlock opportunities other advisors might not see. learn what a cfa charterholdr can do for you

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still to come this morning, there's more to selling legal marijuana than just selling it the new york state majority's leader will join us to talk about fairness in pot sales and making sure more than one group ay investors benefits. st tuned you're watching "squawk box" here on cnbc you traded options. i'm not really a wall street guy. what's the hesitation? eh, it just feels too complicated, you know? well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman? hey, ian. you know, at td ameritrade, we can walk you through your options trades step by step until you're comfortable. i could be up for that. that's taking options trading from wall st. to main st. hey guys, wanna play some pool? eh, i'm not really a pool guy. what's the hesitation? it's just complicated. step-by-step options trading support from td ameritrade

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♪ welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square we are learning more about the battle between jeff bezos and the national enquirer. "the wall street journal" is reporting that michael sanchez, the brother of bezos' girlfriend lauren sanchez, sold the secrets to the enquirer for $200,000 that includes the racy texts and photos bezos sent to his girlfriend joining us now on the "squawk" news line, one of the reporters on this michael rothfeld >> morning >> what's been reported around the news here is that it was

actually $200,000 that was paid to michael sanchez and that's the firm connection that that's where they got all of this information. >> right we've reported that the $200,000 was made in a contract signed on october 26th and that michael sanchez was paid in the middle of november, the $200,000. he received an upfront payment and he provided text messages and pictures you know, we -- he has denied sending, quote, many penis pics, but he did not deny sending photos so we can't say 100% that he provided all of the photos that the enquirer has described receiving. but we do know that he provided some of the pictures at least to the national enquirer. >> i know when i read that line in your story, michael, that caught my attention as well. the distinction between certain types of photos that he actually forwarded on

is the implication of that mean there could be another source of photos out there so it's not just a michael sanchez problem which has been identified? there could be another person out there leaking photos >> well, they've said they had only one source for the material, so either there was another source which is not our understanding or, you know, maybe they didn't have all of the pictures that they said they had. you know, what we're reporting is that he provided some photos and the text messages. >> michael, after doing all this reporting, do you have any feeling that we're getting any closer to the end of days? do you know whether -- i mean, where are we headed here >> i mean, i think jeff bezos and his security consultant are still investigating this and whether there was another source -- >> who >> gavin de becker. >> oh. not pecker

>> no. >> the whole story -- isn't it crazy? tell me, michael did you ever think as a serious reporter that -- and it's so much a headline in "the wall street journal." i've never seen pictures that big in the journal before. >> yeah. well, i mean, right. penis pics, i've been reporting on porn stars and playboy models so yes >> there you go. >> but this is really -- >> so get your affairs in order, dude >> i want to make clear our interest is not this here. this is about powerful people -- >> it is it's fascinating >> that's what our story is about. >> and all the six degrees of separation, you've got trump -- president trump. you know, you got dever and sanchez. there's so many different tentacles to the whole piece and the richest man in the world, obviously >> that's right. yeah and if i could make one quick point, i mean, one of the points

of our story was there was a lot of internal angst about running this before ran at the enquirer. that was the federal investigation involving president trump and the playboy model when they played her hush money in 2016. so that was definitely informs some of the discussions that went on. in fact, general counsel for media had an argument whether this was made. >> and we all know what a catch and kill is now because of the playmate, right? >> that's right. they caught and killed her story of an affair with trump in 2016, paid her $150,000 to bottle her up >> this -- and the person in -- that we're talking about, miss sanchez has definitely had -- i mean, she appeals to men, obviously. you know, and bezos' eye

obviously caught her as well i mean, she has -- she'd married to patrick -- >> she's been connected to a lot of wealthy men >> is that fair to say >> you know, jeff bezos, obviously, sent some messages that were not carefully protected. >> we're all talking about these penis pictures, et cetera. did bezos send them on a company device >> i don't know. but our understanding is that michael sanchez indicated to the enquirer he had received them from his sister whether i understand she has denied that she was aware of that. to bezos' people you know, i can't say, in fact, what actually happened

whether she was aware or how exactly he got them off of her phone. >> there's a fed meeting today, michael. we'll let you get back to your -- >> have fun with that. >> michael rothfeld, thank you for your time. by the way, nbc news has reached out to amazon to jeff bezos, lauren sanchez, and michael sanchez for comment but have not heard back >> not mark sanchez. >> no. other head lewilines we're following for you this morning, the central bank is not expected to raise interest rates this time two retail stocks on the move in opposite directions following quarterly results. even though comp store sales were better than expected, that stock is down a whopping 6%. meantime, michaels the arts and crafts seller is on the rise after its quarterly results came in above consensus dominos pizza shares are

higher it was upgraded to a buy at jpmorgan that stock's up 2.25%. the fight for legalizing marijuana in new york is intensifying as opponents look at their case. odds seemed to be rising that the matter would be postponed. democratic lawmakers including our guests today are trying to fix what they see as racial inequalities that the plan does not address in its current form. joining us now to discuss that is new york state assembly's leader crystal people stokes thank you for your time today. >> you're welcome. thank you for the invitation >> thank you lay out the problem as you see it >> i think if you look at every other state or country that has legalized the use of marijuana, there have not been significant resources provided in there as a

result of the mass incarceration. in new york we like to do that different. we like to make sure that there are opportunities for just economic justice as well as social justice so you want to vacate the records, but you also want to provide investments in those communities that have been most damaged by mass incarceration. >> i think in colorado they have taken and set aside funds. but those funds traditionally are funds that are kind of targeting people who have suffered from addiction problems with these issues. why should incarceration receive a priority over people being a harmed by this to begin with >> i'm not suggesting to you that new york is not interested in looking in adding resources into drug treatment and drug prevention as well as drug education. we are but we also at the same time have a total body of people who -- whose lives have been disinvested and communities have been disinvested in.

and my premise is and i argue i would be right that if you give the proper investment both social and economic, you turn those communities around so instead of them being dependent on government, they'll be responsible citizens contributing to government >> would it be dependent on funds that are coming from the taxation of marijuana sales? >> it would be dependent on those resources, exactly for the efforts that have been expended towards those communities. >> how would you implement it? how would people apply for the funds? how would you kind of dole it out? >> i would say any number of well-run not for profits in most communities who provide mental health counseling, who provide legal assistance, who provide support for children who need to have access to different kinds of health care that may or may not be available there's municipalities who could invest in the quality.

so churn might be able to, say, ride a bike on the sidewalk instead of in the street there's opportunities for folks that will enhance their quality of life, prepare them for a job training assist them if they have a desire to be in business >> assemblywoman -- >> with the incubator space. so i think you have an opportunity to turn communities around >> all of these investments seem honorable. at the same time, how confident are you that taxation of legal marijuana will actually be the pot of gold that you think i mean, california reported in 2018 which is the first full year of legalization that tax revenues came in at just over a third of what was projected which had been $1 billion. they brought in $345 million from the taxation of marijuana so it was disappointing compared to what the state had actually gone into thinking would be gained >> well, you know, $345 million

is a lot of cash and it would go a long way if just a very small percentage of it began to be invested in the lives of people who have been disenfranchised. so i mean, quite honestly, if you look at what the researchers are saying, new york has the largest market of underground use of cannabis and some estimate it at $2 billion. i don't suggest that all of that turns quickly day one into an aboveground economy. but i do think there is the potential to do that and i think that's the direction we have to work towards >> assemblywoman stokes, thank you for your time today. >> you're very welcome thank you for the invitation coming up, the game plan at the fed the central bank is set to start its meeting today but with fears of a slowdown rippling through the markets, now asking if there could be a rate cut we'll pose that question to our fed panel when "squawk box" comes right back rtunity.

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welcome back to "squawk box," everybody. the fed seemed to be raising interest rates like clock work just a short time ago. as the fomc begins a two-day meeting today, it's not just hikes out of style now cuts might be making a comeback steve liesman joins us now for the cnbc fed survey. >> i love the sequence of the blocks sex in the first one

pot in se ththe next one now the fed. that goes along with bringing down the outlook 100% of our respondents saying no hike or anything expected at the meeting where we get the policy statement tomorrow. 60% still expecting a hike. that is down from 78% in our january survey look what happens for 2020 35%. that is greater than a third of our respondents. looking for a cut in 2020. that kind of matches where the fed funds futures market is. look at the outlook, you can see how it's shifted down. the blue line is where we are now. then i compared that with the november forecast. so take off what you want about 50 basis points has come out plus or minus of the market in terms of expectations for the federal reserve both this year, next year, and over the long run. now most of our respondents agree with what the fed is doing. is the pivot to patience the right thing to do? 81% say yes.

the right move and also, they seem to support the idea of ending the balance sheet runoff this year 55% said that they agree with that policy. 41% disagree some do want the balance sheet to be wound down a bit more. moving on, one more thing. where will the fed end up? kind of surprised by this. they say 3.5 trillion. but the way, that's up >> why >> 3 trillion was the previous one. but i think the fed has had good signals they're going to end up in a 3.7 trillion to 3.8 trillion i'm not sure how all that math works. but that's where most of the people with these numbers end up saying a little bit light here. i just wan't to share with you one comment here from raymond james financial. the u.s. economy doing its best to carry the torch for the rest of the world global growth, a trade deal with china, i can't believe that interest rates are going

anywhere >> that's what you're seeing right now. >> yeah, exactly on hold. patient. all good >> all right let's bring in steven stanley as well as robert bruska. the fact and opinion economics chief economist at principle great to have you with us. what are your expectations and do you think the market's got it right at least this year >> i still think the fed's going to tighten later in the year i think we're in a period -- i think it was exceedingly well timed the fed took three to six months off because we've got a lot of noise coming on. kind of tough to say when the dust starts to settle later in the year, we'll see it in good shape. >> so that trade war will be over, there won't be a new brewing trade war with europe, for instance, and we'll know where things lie >> exactly and first quarter growth is going to be low because of the shutdown and the weather and some of the other special factors. that should work its way out as it has in several of the past

years. >> bob, what do you think? >> i agree we probably get one more rate hike i'm thinking of it more as possibly a mistake taking a lot of my cue from the yield curve. i think the yield curve has been to janet yellen, to try to ignore this, right she looked at the tips yield curve and derived yield curve and inflation compensation and the board has always had a hard time dealing with markets they don't like to put this emphasis on markets. i was at the new york fed, back in the late 1970s, and at that time the people at the board were very much in love with their models and not much in love with the markets. and i really like the market signals a lot. i think the markets know what's going on i'm concerned about the new flattening of the yield curve. i think the global economy is still in difficult shape and i don't -- i don't think the economy is going to snap back that much. i think the economy is in a

little bit more trouble. >> that would be a real concern, inverting the yield curve. if they go, then, you know, that could happen at this point. >> yeah. this is an interesting and age old question of who is driving the train here, the markets or the fed, right i think the expectations with respect to the fed now and the markets are very dovish and we have a part of an ease priced in by the end of this year. if the -- what the fed hopes is that the economy does a little bitter, the market will follow along and the fed doesn't have to jerk them forward. >> what is your growth forecast for this year and we asked a question, which is have you changed your forecast for potential growth because of the tax cut? 60% said no. of those who did, they added about 40 basis points. as i recall your commentary, you're more optimistic about the ability of the tax cuts to deliver growth this year talk to us about that. >> absolutely. i just think that it is unrealistic to believe that all of the beneficial impacts of the tax cut on investment took place in a six-month period.

these are multiyear projects, they take a long time to be planned, executed, delivered, and then incorporated into business practices so i think we are starting to already to see a bit of a pickup in productivity growth trend productivity growth we find is higher than where it was before which means i think the economy can do better this year. >> give us a number. >> high 2s. >> is that right are you writing off the tax cut for this year? >> before donald trump took office, had five points for mr. trump to be careful of, one of the points was that he needed to make sure the u.s. economy is competitive before he gave his tax cuts gave us tax cuts, it is not competitive, what happens with it nothing. this is what happened. the dollar is still too strong uncompetitive in the economy you made -- >> what does uncompetitive mean? >> wages globally are still too high americans complain about low wages, the low increases, but globally our wages are high, we're uncompetitive.

and people aren't building factories here if i gave you a billion dollars, you wouldn't make a factory in the united states. you're having tax cuts to make it more profitable to do business in a country where it is not profitable. there is no impact and i don't expect any further impact toward the end of the year. >> what is the root of the uncompetitiveness as you say of the u.s. economy versus other economists isn't part of the tax overhaul to make it more competitive to do business here >> sure. you could have taken corks out of the wine bottle and put them in the big slash in the titanic too. that wouldn't have kept the ship from sinking we have major competitive problems >> we don't have to get back to 50 years ago you haven't seen any resurgence in manufacturing >> there has been some comeback. >> any incremental advances are certainly welcome. >> incremental advances are welcome, but we're still competing with china, the wages are still lower. the modern technology is being put in place in asia where the

wages are lower. you look at the u.s. workforce, we lack some of the critical skills we need to bring the factories here it is not just the fact that the dollar is too high or the wages are too high we lack a lot of ingredients >> if we wait for labor to be equivalent all over the world, either we're going way down or they're coming way up. that's a fact of -- it doesn't mean you don't try to do anything. >> if you study international economics, this is the prediction that was my specialty. i'm telling you, these forces are at work. being discounted by a lot of people and policies. >> it is a huge help to have a tax rate more in line with other countries. no doubt about that. whatever you say may or may not be true, but we got to have a competitive tax rate. >> we got to leave it there. great discussion thank you. >> can i give you both a homework assignment tonight? >> no. you're not the teacher of me >> exactly. >> i'm teaching myself and i thought you might have really enjoyed reading exactly how many

industrial -- >> could be optional >> how many industrial uses -- any of the magnets used to make semiconductors. >> i want credit for -- >> do we get graded? do we get graded >> not just -- we thought it was the birthday party for being affected. >> no. >> let me get to cramer. let's get down and, cramer, it is fun too to make our voice go up real high i'll tell you what i'm going to ask you. we got this -- we have been talking about it all day, all right? look at the wall street journal. so, you know, it is interesting and definitely within our -- something we should talk about, because it is the richest guy in the world and it is amazon, one of the great companies in the world, but stock called up ten does it have any effect whatsoever on the business of amazon itself or the stock price, do you think? >> i think that this is a great question i was debating with our staff here, i think what matters is that lyft is coming public and

you'll hear a series of companies coming public. all on amazon web services it is far more profitable than prime, more profitable in advertising and video. it is overriding whatever you may think. if there was an equity offering of amazon that came from mrs. bezos, i think it would be -- i'm not sure what name she's going by right now, maybe immaterial but amazon web services is going to be powering almost every ipo that goes public and all we'll hear about is how do you play the derivative won't be able to get any stock on him amazon web services. >> we have been -- talked about boeing every day i don't -- there is not much moving in the stock today, but is the -- the risk i guess is not over depending what we find out. >> i'm surprised by it, i think a lot of people are.

the stock acts incredibly well i think we all recognize that there is a -- unlimited downside but the market doesn't seem to care at all. seems to have found -- doesn't seem to have found a bottom yet. >> good to have you back >> thank you. >> see you in fea w minutes. "squawk box" coming right back [leaf blower] you should be mad at leaf blowers. [beep] you should be mad your neighbor always wants to hang out. and you should be mad your smart fridge is unnecessarily complicated.

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quick last check of the futures. dow futures up by 122. s&p up by 12 nasdaq up by 35. that does it for us today. make sure you join us back here tomorrow right now time for "squawk on the street." ♪ got to have faith got to have faith ♪ ♪ got to have faith good tuesday morning welcome to "squawk on the street." i'm carl quintanilla with jim cramer at the new york stock exchange faber has the morning off. futures have pep this morning as the fed begins a two-day meeting of boeing ceo breaks his silence over the 737 max the dow is set to go green for the month despite the drag from boeing europe is trading well uk payroll data ahead of expectations oil, highest level since november 2012. facebook's flood of bad news, shares look to recover from