melissa, mike santoli. ken will be answering tweets directly after the show. >> no. >> you won't be doing that. >> keep faith in america we're the best >> that was 120 characters characters, #usa i will teach you i will teach you how to do it. join us tomorrow "squawk on the street" is next ♪ good thursday morning. welcome to "squawk on the street." i'm carl quintanilla along with david faber. cramer at one market in san francisco. as we look for another day of gains. the e-con data much better today than yesterday walmart with the best q1 in nine years. we pay more attention to huawei as a potential trump card in trade talks. watch yields philly fed starts and claims

were all better than expected. strong earnings outweighing the lingering trade war fears. stocks boosted by walmart and cisco. >> plus president trump declaring a national emergency over threats to technology. and beyond meat surging since its debut. uber stumbling out of the gate is it a wakeup call for other silicon valley unicorns. stocks continuing their upward momentum today following the first back-to-back gains of the month. there are white house plans to delay auto tariff decisions, erasing big losses early in the session. walmart and cisco posting quarterly earnings beats walmart up first e-commerce up 37, even as they talk about tariffs potentially adding to the price of goods >> i think ken and "squawk box" had some great comments.

they won't lose their everyday low price status we're making too much of the tariffs in terms of how they're going to impact both the consumer and the company the stock is right walmart stock is up. they're not going to be able to -- let's say they'll keep the price of groceries as low as possible that is a big come on. i think that -- i'm not saying tariffs don't matter they won't hurt the shareholders and i don't think the consumers will see it other than they had to say something about it on their call the multiple already has already rerated to a certain extent more recently as a result of that rebound we've seen in comps and obviously most importantly e-commerce growth. gross margins up six basis points that's the first positive inflection in two years.

freight was better in terms of costs. improved margins that was up 37%, their e-commerce revenues. >> they're pulling away. that's the way i look at it. there's amazon there's walmart and another tier you can probably put costco in the top tier these numbers are impressive we could talk about what the tariff will do to profitability or listen to what they say which is similar to what sysi cisco s last night there will be some impact. cisco said the impact already occurred i think this walmart number is spectacular. if we belabor the tariffs, we will miss the big picture. the e-commerce offering is unbelievable >> the margin reflects higher

labor, and the comps 3.4 are decent for the fifth straight quarter they made it up on ticket rather than traffic >> look, i look at the situation, i say they're very forward. you will see a mick a yex a yea now that will make them the cheapest and the fastest what i'm looking at with walmart is people are saying they got the edge on everyone if you look out a year from now, they'll offer every-day low prices because they have more power. they will keep groceries the lowest in the country. they'll win the race so i think that the strength in the stock is somewhat because of the great comp, but also a recognition if they keep it this pace, holy cow, no one can keep up with them other than amazon >> yeah. in terms of the color out of the commentary, shout-outs for things like private label food penetration up 150 basis points. pets, pet category got a

shout-out. numbers of stores with pick up, 2450 versus 800 whole foods out there. nearly 1,000 with same-day delivery >> yeah. >> the numbers at this point -- >> numbers are large they did talk about currency continuing to be a head wind that will continue the market doesn't pay attention to that? >> it's funny you say think thao focus on, not tariffs. when i say we're making too much of tariffs versus other issues the currency just keeps hurting everybody. can you imagine what would happen if the currency would change these numbers would explode. it should be more of a focus, tariff a little less >> revenue a miss because of r forex. a beat on top and bottom line and better than expected current

revenue guidance chuck robbins talked about guidance on "mad money" last night. >> i'm proud of the team last week, we got the inedytation that the tariindican that the tariffs would go to 25%, they did, and our team executed on what they needed to excuse on to take care of it it's behind us and immaterial at this point because of the work our teams have done and built into guidance. >> how are they doing this when so many players are in the crossfire, huawei, semis, apple, a bunch of other names >> they saw it coming. now 3% of the business is china. they saw china shifting away from cisco they realized this is for keeps. they kept close touch with the president, with washington, and they realized we have no choice. we have to get the hell out of china. they did they're sourcing all over the globe, but not much in china

i think they're the way of the future if you look at that stock, that stock is saying we figured it out. by the way, this started -- chuck robbins immediately recognized the resolve of this president. he shifted as fast as he could you heard what he said on the conference call he talked about we're going to 25? i want to know we won't have exposu exposure people have to do what chuck did. because your numbers go higher if you do it the u.s. and china remain locked in a trade dispute. the president ramping up his campaign against huawei by declaring a national emergency over the tech. his national order requires transz act transactions to be blocked that poses a risk to the national

security of the u.s. jim, a lot of comment tear out today that the tougher element of this two-pronged approach is requiring -- is adding to this so-ca so-called entity list, where u.s. companies would have to get a license to sell this technology tom cotton tweeted rip, thanks for playing. >> i was shocked at that this is more important than tariffs. they're a huge customer. huawei is just a giant -- a giant mall of qualcomm, broadcom, skyworks i cannot believe it. this is tough. huawei is a giant company and a lot of our companies sell into them this does cut numbers instantly. >> you would be watching micron? qualcomm >> yeah. >> they all sell qualcomm has a large deal.

it's an important customer for them they're still in the midst of renegotiating with them, of course, al terms of a new agreement. jim, i mean, this is with one hand sort of reaching out to say let's get back to talks. the other taking a baseball bat and whacking them around the back >> yeah. i got to tell you -- >> if you recall zte, how we had that company conceivably on the precipice of failure as a result of similar kind of a ban for a while, that gives you a sense here of the importance of this potentially for huawei it doesn't mean it happened as of yet, but it could they rely on u.s. technology at this point the chip sets that we mentioned from a number of u.s. providers to power a lot of what they're planning on doing. this is more than a shot across the bow, isn't it? >> this is much bigger than

tariffs. this says we're stopping the 5g leadership we will not let our technology companies make them be ahead of us in 5g our companies will pay but again, this is what chuck robbins is saying. if you sell into the chinese, you will get hurt. if you rely on china, you will get hurt these companies don't have choice are they going to say no to huawei it's a gigantic customer it's a surprise. you mentioned micron that stock has been going down from 4t2 to 36. qualcomm has a lot to give up. it was at 58 when it broke the news about apple stocks will come down. that's right those numbers have to come down so those stocks should go lower. >> i don't quite understand what the plan would be? there is not a u.s. provide every of the backbone services of creating the networks themselves with the infrastructure you need. we don't have one in the u.s. any longer lucent is gone >> no. >> cisco does what it does, is

it aeric sessonericsson who are you supposed to rely on? >> aericsson is efficient. nokia, if you rely on them, you won't be ahead the europeans don't understand the gravity of the situation i think that the president has just decided we'll be so unilateral in this one we think these guys are outlaws they think huawei is an outlaw huawei has the most momentum of any telecommunication company in the world. you're basically saying our companies will not play with the juggernaut they're going to -- wow, i don't know again, numbers come down >> yeah. >> look at that. look at those shipments. look how strong huawei is. in china, china steers as much business to huawei as they can it was a honey pot

it's nothoney pot anymore. >> those are the shipment of smartphones where we compete and there are competitors, but i'm talking about building the guts of the network to carry the information. >> my question, jim, what is our juggernaut is it apple? what do we do if europe, which clearly doesn't look like they'll do this, play along with our separatrategy on huawei? >> it's amazing europe won't play along they that steer the business towards ericsson and nokia >> we don't know if this can be repealed this is not a shot across the bow. this is like okay, we're not playing. the quote from the center, we're not playing. we're willing to take the hit even with our best companies you mentioned apple, they're the only one that i guess that we could say they can retaliate

with they would be cutting off their nose to spite their face 2 million developers in china. those people will get hurt i don't know whether they're willing -- maybe the chinese government is willing to take that hit that's the only company. can't do niketucky fried chicken >> some news a few moments ago from goldman sachs they're buying united capital financial partners the price tag is 7$750 million it is cash this is a registered investment adviser. it has about 25billion of assets 220financial advisers. 22,000 clients 90 offices across the u.s. what's interesting, we talked about it a number of times i spoke with david salomon a few weeks ago at milkin about the strategy to attract the mass affluent this fits in with it united

capital will enhance goldman's able to cover a broad range of clients for their a-co unit as well as their adviser-led tech enabled platform with considerable scale and geographic footprint they say it will compliment the digitally powered consumer platform for individuals from marcus by goldman sachs, which we know is a real strategic priority for the firm. 7$750 million deal announced ths morning, a few moments ago by goldman sachs buying this firm united financial capital partners 7$750 million in cash >> it is important it's important because goldman has the lowest multiple of any of these companies people still perceive it as a trading house. if they do five more of these -- they may -- we won't look at it as the way we do and the multiple go up this is goldman sachs buying

united capital i don't know sorry. spear leads was the last big one. >> right that didn't go too well. guys, as we go to break, shares of beyond meat continue to sore as other companies look to avoid that uber slump as they get ready to go public another look at the premarket. the data was not bad after the retail sales number and ip number yesterday we got nice claims, nice starts, nice philly fed. a four-month high. don't go anywhere. [knocking]

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introducing an easier way to move with xfinity. it's just another way we're working to make your life simple, easy, awesome. go to xfinity.com/moving to get started. beyond meat continuing to climb. shares up more than 250% above the ipo price as companies looking to enter the ipo market hope to avoid weak debuts similar to uber. the parent of wework among them. saying we really want to emphasize the difference between losing money and investing money. you can lose money or invest money. at the end of the quarter we have these cash flow generating assets when it comes to beyond meat, on twitter you found some religion. >> yeah. beyond meat is run in a very -- not whimsical, but a recognition that who they're appealing to.

there's a generation of people appalled by meat, appalled by dead animals they get that. they embrace the notion that it's a young person's game they're quite exciting people. they do not take themselves overly serious and they're all about winning this category instead of impossible burger, winning the category instead of nestles. they're doing a good job >> like a $90 a share good job >> well -- >> what's the multiple to r revenues now >> i think the company is enjoying the run put it that way. >> i'm sure they are if they can hold up for another five months, their employees will enjoy it, too >> yeah. we need impossible burger to come in i had one this weekend god, was it juicy. >> really? >> yeah. juicy. >> are we on air, david?

i know you don't shop or do anything i need to you have an impossible burger this weekend, okay? >> really? i don't think so >> it's deusualllicious. >> i eat cookies mostly, ice cream. >> that's important. >> yeah. guys, speaking of ipos, beyond meat one of the great successes. uber not so much lyft not so much we're waiting on wework. you know, recently i had an opportunity to talk to the ceo, cfo, they are engaging they are moving ahead with prospect of an ipo in the not too distant future one would imagine. we don't know when exactly they filed confidentially a while back they did put out financials yesterday. they have some debt holders. it's going to be interesting to watch. are they going to be judged on another unicorn losing a lot of money even though their revenue growth rate is accelerating, thank you very much, different

than what we saw with uber how it's going to be viewed in the marketplace will be interesting. they are certainly trying to lay the ground work for telling a different story in terms of the addressable market in terms of the percentage of the revenues that are from large enterprise customers not small businesses not startups, but big names we all know very well that will provide a much more sense -- much more recurring revenue stream the idea of building a pipeline of space to monetize over time space as a zf. that service. driving a lot of different services to the inhabitants of so many buildings. we'll see how the story evolves, it will be interesting to watch on wework. >> i think they're also a play we have a robust economy when you need more space, they have the space you raised a key point

will accelerating revenue trump losses we saw that model with amazon. when we go back over uber, we realize it was that last quarter. it showed a big deceleration it took people by surprise they came public a quarter too late that's what -- so now they're just being talked about as a cab company with a cell phone attached to them wework will be one that people will like, even though it won't be for me. losses are too great >> we'll spend a good amount of time talking about it prior to when it comes public voracious user of capital now. that's a key part of the story >> a lot of attention to this arc. we'll get kram cramer's mad das, getting close to the opening point. don't go away.

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we can make better informed investment decisions. that's why i go beyond the numbers. market looks to add to the gains today as the economic data is good. walmart has a good q1. the opening bell in less than five minutes

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let's squeeze in a mad dash. macy's a feature yesterday you want to hit it today as well, jim? >> we often talk about value subtracted research. how about value added. goldman sachs told people to sell macy's 41% ago. today they up it from sell to hold they still don't believe the model can overcome the mall.

but they recognize that jeff gannett is mitigating some mall-based issues. just not selling a tepid endorsement. basically saying, look, the mall is still a horrible place to be. this stock reflects the horrors of the mall. let's give it upside >> anything else reflected the horrors of the mall jim? >> no. but i think we have to understand the contrast between macy's and walmart is extraordinary. walmart is one step ahead of the posse at all times macy's, positioned in a place where people can't do, let's see, easily pull off and get stuff. macy's in the end is a place that sells a lot of stuff that you could get on amazon. walmart, the grocery is so powerful the grocery gets you in because the stuff is so cheap.

>> citi today talks about the stealth change in the macy's l model arguing that they look more like a marketplace than a department store there's the s&p at the bottom of the screen the opening bell at the big board. it's quadratic management. at the nasdaq, it is jiayin, an online individual finance marketplace in china see some early gains here out of the gate in terms of the chinese headlines overnight, one is that they denied the president and xi have hard plans to meet. no knowledge of plans for a delegation to visit. they received a tanker full of iranian oil. and there's talk that they'll sign a landmark aviation deal with the eu as early as next week so, a lot of conflicting information given what mnuchin

said here yesterday. >> i think the hard-liners are in charge there. the hard-liners are in charge here lighthizer a hard liner. the pla that backs xi really stepping up and saying, listen, we have to shut united states down they want to go after us you know, i've been working during the commercials samsung is saying we'll build the 5g just give all that business to us we'll create the 5g network. taking the place of huawei i don't know this stuff is fluid. it is very tough on some american companies first time we're seeing companies being shut down by our own president. everyone keeps saying the chinese are playing the long game our president is hurting some of our companies in the name of shutting down a rogue outfit it's impressive that he's willing to take the heat from those companies. he's been saying if you sell to anybody in china, get out.

stop >> it is worth noting there has never been presented actual hard evidence of huawei spying. it's been assumed to a certain extent the nature of the ownership of the company has been somewhat opaque to put it lightly relationship to the communist party, but there's never been hard evidence that has been presented that says here it is -- at least that we've seen, this is what they've done. >> i agree but i would say, look, just lick our country. if you're a company in china, it is your job to help the chinese government so you can say wait a second, that is -- that makes them a double agent but, we have to do -- our companies are supposed to report anything that they think is untoward that is against our interests. that's what huawei has to do some people think therefore they

are a government entity. all i know is we do a lot of business with them the companies that do a lot of business with them are shocked that business just went away >> most sectors doing pretty well jim i did notice in terms of the trade tensions, nomura cuts owings corning today on the idea that housing demand for older buyers might fade if equities suffer in the long-term because of an enduring trade spat. >> well, how about if they -- equity market does well? are we supposed to buy the stock? that is just-that's a thin read of analysis. that doesn't make sense to me. we should sell home depot. we should sell the stock of lowe's they better come up with a better reason to get rid of ownings corning. i'm much more concerned again,

looking back at huawei, zylinx had the best 5g technology that's what you should be talking about. >> this is not a u.s. company, but well known name. sony is up this morning. almost 2%. the company announced a buyback worth about 4.8% of its overall shares 1$1.8 billion worth this is a company that announced the first buyback back in february of this year. the idea that it would follow that up with another announcement of a new buyback program, this one again for 1.bi1.8 billion of stock beginning now, ending the march of this year. giving it flexibility. it doesn't have to do it but it may depending on other considerations and strategic opportunities for investment

that may come its way. timing is strange. not just because they announced the buyback a few months back but also because they have an investors meeting next week. one would expect if you want to do that, time it with the investor meeting dan loeb's third point, a significant shareholder here, in a special purpose vehicle, this is how it's done these days by many of the activist funds, unclear what will happen there i reported previously on mr. loeb's viewpoint,that there's net asset herefar in excess of sony and the stock price, those bullish on it believe that what can you do to address that? the stock is trading at eight times free cash floew. cheap on eps the music business undervalued versus the likes of universal music group. we'll see what comes out of the

meeting next week. sony shares up 2%. connected in a way through third point which has a large position in nestle, if you recall something initiated in the second quarter of 2017 there i think over $3 billion worth of stock nessctle announced a strategic review of its skin healthcare business back in september this morning news that they're in discussions with a consortium led by eqt partners for the sale of that business 10$10.1 billion. that's a price tag above what some had anticipated that would be the second largest private equity backed m&a deal in europe since the financial crisis to give you some sense as to the size there. it is a large deal nestle has done quite well in doing a number of different things in terms of divesting noncore assets and focusing on coffee, pet food, for example,

and the like but that's been a strong performer over the last few months as you can see right there. >> i had nestle on last week pet food and snacks. great secular tailwinds. i'm glad they got rid of this business this skin health doesn't fit in with the mow ssaic of business which is concentrating on the fastest growing part of the supermarket. they have done a great job with purina i said you have to offer adrs. people want you you as a play on europe that's not been their style. you have to buy it over there. i think it has to hurt them. the stock is a juggernaut. that is a great one to own on sony, they have been buying back, but they have more shares in the works than years ago, versus cisco, where they bought back a ton of stock at 52. buybacks are not all created equally.

nestle doing better than a lot of our companies some interesting stuff going on just behind the scenes jim, discussion about amazon today. not just because of the disclosure by berkshire that they have about 900 million worth, but that it bounced on support, coming right off that 50-day moving average, back to almost 1900 again. >> we live in a f.a.n.g. universe now but for different reasons. the chinese didn't let us in didn't let american companies in the money shifting from companies that do business with china to companies that don't. it's happening rapidly today is a very big day for that trend. you will get a higher priced multiple if you're chuck robbins, lower if you're a macy's saying all right, we didn't count on this, it's not in our numbers we have to figure out what to do walmart walking the line

perfectly by saying we can handle this. the customer will still get every-day low pricing. that stock doing well. >> some discussion today about social media names as well largely the white house has launched this tool to help people report what they believe to be political censorship on facebook, twitter, youtube, stam instagram. even ted cruise tweeting to tighter about why one of his tweets was not included in moments. >> i think that twitter uniquely is doing ai. unless ai has a bias some people think artificial intelligence has a bias. i think they're trying to be neutral by using machine learning but if ted cruz thinks their artificial intelligence has already developed some sort of sky net thing where it's thinking on its own? that's a joke.

>> already there it's going to have full consciousness soon you are a simulation after all let's not forget that. >> yes, i am a simulation. i'm a hologram pinterest is not in the cross hairs. i think that will be a must buy. i have pinterest on tomorrow night because i'm a booking machine. >> we'll get pinterest tonight, the print at least at nvidia that will be interesting >> shy go see enindividual yes yes, i am. i'm going there after this >> are you really? is he coming on, too >> yeah. he is. what do you think? i come out here for nothing? >> we'll go through a lot of promos for your show here. there's silbermann he's coming on tomorrow. >> anthony noto tonight. there is noto and -- okay. anything else? >> i'm trying to take some of your people, david >> yeah.

>> some of the cable people. >> who did you have in mind? feel free. whatever you need. you go ahead book every single person there is >> i have to start somewhere look, i'm trying to get beyond meat in the worst way. >> no luck yet >> zeitgeist >> you say nice thing. >> i'm very close. i got a vegan daughter i will win the race to get beyond meat. that is the zeitgeist of this market, beyond meat. >> you going to do a taste test? impossible burger versus beyond meat >> well, yeah. >> versus an actual burger >> don't forget, condiments are the key to those burgers i had had the nestles burger last week, which is made up of -- i don't know, soilent green, it was fabulous it's time to go vegan. the nestles burger was fabulous. i'm getting away from the whole meat thing dead animal i call it. >> i get that.

i completely get that. >> yeah. >> it's time >> i'm not going there, but i get it >> have to get away from dead animals, have to get away from china. that's how get your multiple up. >> guys, we're taken out yesterday's intraday high, 2866. let's get to bob pisani and see what's moving on the floor >> the important thing is that we've had a very nice rally in the last 24 hours. that's the important thing let me show you the s&p futures. we rallied 50 point in the s&p 500, about 400 points in the dow jones industrial average since 9:00 a.m. yesterday. it's rallied for a number of reasons. trade talk discussions a number of big advancements we talked about an auto tariff delay yesterday. progress with nafta, that helped talk that mnuchin and lighthizer may be returning to china.

the chinese don't seem to be aware of that. all of that helped to move the market forward today we're helped by walmart up 2% cisco had good numbers as well that's not the big mover the big mover is the progress we've seen on trade here the chinese view this as one thing. tariff wars, battle against huawei efforts to criticize the belten ro and road initiatives this is moving the markets in the last 24 hours. those trade war discussions. meantime we have had discussions here and the huawei initiative i think is very clearly hurting semiconductors today if you look at the big names, qualcomm, lam research, the markets are up today smuk semiconductors to the down side. if you look at sectors generally, up about a quarter or half a percent for most of the

rest of the market materials, banks, healthcare, broad groups, down about 1.5%. also want to comment on walmart very quickly these numbers were good overall and right across the board traffic up 1.1%. average ticket, 2.3. put that together, you get 3.4% growth that's pretty good look at that e-commerce number, up 37% these numbers are impressive walmart is doing well. it's that differentiation that is very important. who is up this year? walmart is up 7% target was up a lot to more. but it's been down the last month or so. now only up 7% costco, amazon, why are these companies that matter? there are not many companies that have the infrastructure, that have the talent and capital to give the consumer what they want today, which is same-store delivery, in-store pick up it's extremely expensive those are some of the only four out there that can pull that kind of deal off overall

everybody else we hahave been talking about new lows in retailers. put up the aparaphernalparel co. these smaller companies don't have the wherewithal to provide the consumers with the overall experience they want so we're getting an enormous differentiation between the winners, i showed you the four winners at the top and everybody else that is struggling. you grow your retail sales by opening new stores they're not opening new stores it's difficult to do that if you're shrinking your store size, how do you increase revenues overall that's a major problem the rest of the retailers in the world are not the big winners. back to you. >> bob, thank you. >> let's get to the bond pits and check in with rick santelli at the cme good morning >> good morning. we are definitely seeing movement in the treasury complex. it could be for a number of reasons. we got a nice sampling of data today. we see that the equity markets

are putting some positive numbers up especially after a turnaround giving some confidence to the fixed income traders, especially after challenging such important historic levels all along the yield curve. there's the two-day of twos. right now up, what, four basis points as we trade 220 as you look at that chart, today we have a higher low that's key it's moved down the curve, that diminishes -- the two day of tens, they have lower lows and a nice bounce in the intraday low, 235, the 237 correlates with the low close of the year, it may be holding. it is tenuous. if you open the chart up to december of 2017, you can see should we start to close a few basis points lower, we'll be coming back to that area around christmas 2017 you know, here's something fascinating. we all know the spread between

bunds and tens moves quite a bit. here's what is interesting this is july 21, 2016 chart of bunds. not fall away the negative yield of 19. about ten away now you know where ten-year note yields were in july of 2016 when they were trading minus 19 135. we're now at 241 just to give you a concept of how much fluctuation has gone on between the two sovereigns and how currency fluctuations had to kind of adjust for that. finally everybody continues to talk about china though it certainly seems that the markets are looking past it, the counterfact wall may ual, i were no arguments with china, how good would growth be this is dollar versus the chinese currency, the dollar at the best levels senince after christmas of 2018. jack ma speaking in paris

was asked about tech and internet regulation. listen to this >> we don't have rules or laws for internet nobody realizes what internet looks like that leaves us chance to grow fast europe, very interesting you have such a perfect rules and laws everything to do follows rules and laws everything we think about, they start to worry when they worry, they make rules and laws when we have problems, we have to solve the problems then think about rules and laws you have problems, you make rules and laws i worry about europe >> kind of hard sometimes to separate ma's personal views from what he is carrying water for in terms of chinese leadership >> yeah. that relationship has always been an interesting one for him in terms of -- and a complex one, by the way. worth pointing out he's no longer really involved

day-to-day, he meets with the large shareholders, but he stepped down people need to keep that in mind a very important guy to listen to have great affection for him personally, he's quite enjoyable to talk to not sure i fully understood every point he made there. >> no. >> tomorrow, an interview with sheryl sandberg. don't miss that. walmart one of the earnings winners. we will talk with bill simon about how trade tensions may affect the company spoke has a nice table out on how walmart has kept up on earnings but closed the day lower. direct messages have evolved.

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time for jim and stock trading. >> it is about hardware versus cloud. the hardware, the semiconductors not doing that well because they're trapped by the huawei issue. companies like adobe doing fabulously why? adobe doesn't want to do business in china because all their stuff, they have found, ends up getting pirated. look at adobe, that's going up they pulled back from china, just intellectual property being stolen versus the companies doing business with huawei, their stocks are getting hurt. so nice dichotomy. watch companies that deal with the cloud that don't do a lot of business with china. their stocks are going much higher >> all right, jim, we already talked about what is on "mad" tonight. anthony notah and what else? >> tomorrow we have got nvidia and tomorrow we -- we also have pinterest. tonight we have the hottest -- maybe one of the hottest stocks out there, zendesk, a company

that truly has accelerating revenue, wework, but it is already public jensen huang, unbelievable. >> big one that's a big one. >> yes, thank you. thank you, guys. >> we'll see you tonight, jim. "mad money" 6:00 p.m. when we come back, bill simon, dow up almost 200 n'gonyvehe0 y.da dot awhere. 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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♪ good thursday morning. welcome back to "squawk on the street." i'm carl quintanilla with sara eisen, david faber at the new york stock exchange. look at the markets here nice morning dow up 210 s&p back to 2876 we might erase the dow's losses for the week with another 90 points or so as we continue to watch trade and walmart. >> and that's where our road map begins stocks rallying for the third straight day boosted by cisco and walmart we'll speak with former walmart u.s. ceo bill simon. >> faang back in favor and major u.s. hedge funds buying back into the tech giants >> the most successful ipo of

the year we'll talk to pat la fraidia about beyond meat's meteoric rise >> stocks extendinging their rally for a third straight day as investors weigh strong earn fr ings from walmart and cisco. joining us this morning is bill nigren and curt. thank you for the time today very much appreciated. good to see you. bill, i'd love to get your take on the overall market environment when we're in this period where we're heavily reliant on tweets, we're dealing with issues where hardly anyone has any edge is this scenario where you find a lot of ideas happening or is it too treacherous >> as you know, we're trying to look past the short-term news flow and trying to anticipate what investors will think businesses might be worth years from now so i look at an area where we're very heavily invested in, say banks, ally financial, capital

one, bank america, citigroup these are companies that are selling at eight times expected earnings today, historically they have sold at more like three-quarters the market multiple, 12 we owned them for a few years. i think three years go if you had said allied financial is going to earn something like 360 in 2019, you might have guessed the stock would be selling in the mid-40s. instead it under 30 today. 90% of book value, eight times earnings, cap one, citigroup, also at about eight times earnings we think there are tremendous values >> can banks rally with yields low and moving lower >> yes, i think they can if short-term rates go a lot lower, then the adopt franchises that these banks have won't

produce as much current income as they do in an environment where interest rates are more like the level of inflation. i don't see any reason to project that long-term short-term interest rates will stay below the inflation rate. >> curt, what about you? how you navigating through the volatility and would you say it is safe to be in the market with continued prolonged uncertainty now over u.s./china trade relations? >> i think you want to take advantage and exploit the volatility on both sides on the upside, i think that if you're happy with where you are year to date, we had a great year, i think you want to take some of the gains. there is nothing wrong with doing that and on the downside, i think you want to look for stocks that have fallen below their 200 moving day average so we own these great stocks you want to look at things like the texas instruments, and if the trade wars get very protracted on the downside, you want to look at a stock like caterpillar with 3.25 dividend

yield. it is a fufrpfunction of the tr. take advantage on both sides of the volatility >> bill, when it comes to oil, we're seeing some m&a activity in the pipes you got a ton of geopolitical risk are you -- what is your general take on the space? >> we like the u.s. enp companies. we own a lot of anadarko we were pleased with the process there that resulted in a good bid for the anadarko shareholder. and we think the seven times cash flow price that the occidental bid ended up being for anadarko is a number that makes a lot of the u.s. enp companies look very cheap. we also own apache at seven times ebitda for apache, almost twice the current market price so it is a space we like a lot >> the question, of course, bill, are you going to see more consolidation? everybody would love to talk to a 62% premium on whatever their

favorite name is, anadarko ultramultiultr ultimately received. it is not clear we're going to see another deal or deals, is it >> it the not clear at all there will be more deals but i think these companies are showing earnings and cash flow levels with oil now in the low 60s that prices higher than the current level or supported just by current income. and we think long-term oil prices need to go higher to support global growth. >> curt what about you how did the commodity picture and rates picture and currency, which we saw hit walmart so hard today, impact stocks where are the correlations right now you're watching? >> well, i think you have to look at the correlation between the stock and the bond markets going forward. i think what is really interesting to me is that year to date you had stocks and bonds pretty much rallying in sync i think the big question is what is the relationship between

those two markets going forward. are rates going to back up and stocks go down or are we in a lower rate environment, protracted, and is this going to continue if you look at a 2.3%, 2.4% ten-year treasury, 18p multiple is not unreasonable. the institutional market is really wondering what is going to be the correlation between stocks and bonds going forward. >> speaking of rates, bill, i see credit card interest rates are getting close to 17% you got to go back to the mid-90s to see numbers like that we got some q1 delinquencies as well, highest in six or seven years. i understand why that might -- the actual rate is positive for some of these financial companies, but are you worried at all about overall consumer strain >> i would say no. we're not worried about consumer strain you look at a company like capital one, where credit card

lending is their major business, they're earning good margins today, not seeing a big increase in their default rates you see a little bit of a seasonal increase, but you see that every year. but year over year, things look pretty good and the stock is at eight times earnings >> all right, not everybody has your level of patience in the time horizon, bill that's a good conversation bill and kirk, thanks. see you soon >> thank you walmart out with results world's largest retailing reporting an earnings beat revenue did come up a bit short. courtney reagan joins with us more good morning, courtney. >> i think altogether you look at this quarter, it is just an example of how walmart's strategy to integrate stores and online continues to deliver. earnings beat sxiestimates looku pointed out. revenues came up short, almost a $2 billion negative currency drag there the key u.s. comparable sales of 3.4%, that is the 19th straight quarter of positive comp growth.

also slightly better than expectations sams club comp was up marginally, impacted by a decision to pull back on tobacco sales at certain locations but these total u.s. comp sales are lifted by both strong traffic in stores, that's up for 18 straight quarters and online sales growth, in the u.s., net e-commerce sales of 37%. the plan to push into higher margin product offerings like home and fashion online is beginning to bare fruit and that's helping with the margins there. the big question hanging over all of retail, though, is the impact of tariffs. current and potentials to come now, walmart cfo brett biggs told me, our goal is to be the low price leader we want to manage margins with customers and shareholders in line we have mitigation strategies in place for months but increased tariffs will increase price for customers the retailer won't detail which products will see higher prices or how much, because it will vary from product to product it is worth noting that walmart

sources two-thirds of the goods domestically that's due largely to food business remember, over half of their sales comes from food. remaining one-third is sourced from many countries, china, of course, is a part of that. we should point out that walmart's inventory up almost 6% in the quarter biggs says he feels okay about that he said there is some forward buying because of tariffs, but also some buying for mirroring, to get the merchandise in e-commerce closer to the end customer so there is more of it in more places and then we got this persistent cooler weather and that led to higher levels still left over. hard to sell patio furniture and things like bathing suits when you're wearing coats outside >> yeah, kind of a bummer. courtney, thank you. courtney reagan. for more on the state of the consumer war between walmart and amazon, we're joined by former walmart ceo bill simon what is the first metric you look at.

better same store sales growth or 37% e-commerce growth to show what walmart is actually doing >> i think it is the same store sales growth, which has been really impressive. 37% e-commerce growth is part of the same store sales growth. you look at both of them at the same time. the team in the u.s. is doing a terrific job now i think that mirrors the state of the u.s. consumer, which is also, you know,ing to doing vel >> 37% e-commerce growth is obviously a very, very strong number is it strong enough, though to compete with amazon? it does mark a little slowdown from last quarter. >> yeah, it does i think it is strong enough. and, again, keep in mind that walmart's strategy is this integration of the physical and the digital world and the growth that they're showing in e-commerce is, you know, is bolstered and in a way delivered by their physical platform so i think it has been pretty

impressive that they sort of declared what their strategy was and they're doing a good job executing things >> and then just before earnings, they beat amazon to the punch with that next day delivery service how much of a difference do you think that will make to customers. >> well, it is big for customers, you can question both walmart and amazon have to answer is at what cost and how is that going to impact their bottom line. i think one of the things that i still am concerned about at walmart is their operating income was better than they thought it was going to be but still negative you look at the operating income history over the last three or four years, it has gone down from 29 billion to 20 and it -- so the strategy that they declared, they're executing, it has been at a very steep price and as you sort of progress towards next day and then same day, cost is tremendous.

at what point is enough enough. >> bill, are we just going to have to get used to the idea that ticket is going to drive this rather than traffic over time i mean that for walmart and retailers in general >> i think it ebbs and flows and right now i think walmart is selling a really decent balance between ticket and traffic but that's not the trend in the market i think what you'll see is a period where consumption, you know, quantities, level, you have a whole bunch more competitors in e-commerce transactions, recorded the same way that the physical transactions are and so it is a little bit complicated. i think you'll see an ebb and flow and need to look at the balance of both and same store sales, as long as it is in the price driven, and, you know, look at gross margins, for that as a comparison. as long as it is mixed driven, i'm fine with a more moderate, particularly for -- transaction growth. >> right and speaking of margins, is --

how much liability lies in trend toward higher labor costs and a trend toward more online mix does that mean that the liability to margins overall is increased over time? >> yeah, i think that's what you're going to see is pressure on margins and operating income because margin mix, you know, that you're going to -- the margin rate you're going to be able to show with the same day or next day shipping is going to put a tremendous amount of pressure at the same time, rising wages are going to put pressure on operating expenses that's what's striking the incredible shrinking operating profit >> given your experience just in general with the consumer, what are your expectations overall given that prices are going to go up from anything coming from china and conceivably on everything cominging from chieia

do you think people will pull back >> i don't i think the consumer is strong and will remain strong wages, employment, gas prices are really the three leading indicators for consumer strength i look at. and all those seem stable for the time being prices are going to go up. i'm still optimistic about a deal being done with china, so hopefully that happens but in the event that it does, the question is really how much is going to get passed through don't forget that retailers, particularly, were big beneficiaries of the corporate tax cut just by the way the nature of the way they're pnl is set. walmart, their tax rate went from 33 to 19. they got a couple of billion dollars sitting around in the pnl that they have been investing. walmart, and other retailers every retailer will look at the cost increases, figure out how much they can pass through

figure out how much they can mitigate by moving the production source and then that -- what is left over will impact the consumer. i don't think that will be as big as -- i hope it won't be as big as we think it will be. >> i guess the question, speaking of a couple of billion dollars, currency was no joke for this,this quarter. shaved about 2 billion off of top line growth. which is the bigger threat, the strong dollar or the trade fight in tariffs >> well, i think it is a balance of both. i think you look at walmart's international results and, you know, even with the currency adjustments, sales weren't particularly great the impact, i think that's where the impact of the flip cart loss which might be bigger than they anticipated showed so they had a pretty dramatic operating income drop. i think the strong dollar is going to really be a challenge for companies like walmart with

a largely not -- a large non-u.s. business. but it is a benefit for the u.s. segment as you saw there as well >> bill, finally, i got to ask about your optimism about a trade deal with china. i wonder if you're moved by comments by people like steve bannon who argue it is not about getting a deal done anymore, it is about disentangling the china u.s. relationship full stop. >> yeah. well, you know, i think that might be part of the negotiation. but the reality is if you look at it at its base form, china needs a deal, really bad and the u.s. needs a deal. maybe really bad, but maybe not as badly as china. and so when you have two sides that are really motivated and -- i think one gets done. the problem is that a typical deal in the president's experience of the big deals have been in private with

discussions, you know, over a couple of months or years to get a good deal done and that this brinksmanship that happens in almost every deal, i'm going to walk away, this deal is not good enough, it happens every deal i've ever been involved in, it just doesn't happen on the front page of every newspaper and every media outlet in the world. which makes it more difficult. at the same time, the president has his detractors here who are, you know, saying -- indicating he may not be around in a couple of years or a couple of months depending who you listen to. it is complicated. but i feel go back to my optimism china needs a deal and we need a deal. >> all right, you would think. bill simon, thank you. >> see you now >> when we come back, shares of boeing down around 8% since last week we're going to take a closer look at the impact there in terms of china's tariff. and our tariffs. plus, the most successful ipo of

the year we'll hear what famed butcher pat lafrida thinks about beyond t seet ensqwkdebuwh "ua onhetrt" continues introducing the first-of-its-kind lexus ux and ux f sport. also available

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fortune releasing the annual company rankings with walmart taking the top spot for the seventh year in a row. exxonmobil maintaining second place, while apple moves up a spot to number three and is the most profitable company in the fortune 500.

for the fifth straight year. berkshire hathaway and amazon rounding out the top five. this is the first time amazon was in the top five. this year's list grand total of 33 which sounds pathetic but up from 34 in 2017. 6.5% of fortune 500 ceos are women. a lot of that has to do with some announcements that have come recently in terms of female leadership like we got bed, bath and beyond and best buy. some of the more recent ones the other thing that was striking about this list is just how big the big have gotten. and just how big of a chunk they represent of our economy for instance, of the fortune 500, revenues, up twmakes up two-thirds of the output 40 companies alone make up 52% of the combined earnings these companies are just mammoth. >> yes, they are

walmart still, yeah. >> it is measured by revenue >> i understand. thanks for that. >> new to this i am new to this i appreciate that. i thought it was cute. when we come back, the faang comeback as we see the dow up 215 now. the best gain for the dow since april 12 >> i'm phil lebeau in chicago. since the trade talks ratcheted up on monday, may 6th, shares of boeing have been down as much as 8% the aerospace giant reported $13.8 billion in revenue from china last year. and expects even more down the road china's fleet is expected to more than double over the next 20 years, leaving 7600 airplanes valued at $1.2 trillion. the terennse trade talks do not come at a about time for boeing as the max crisis continues to

weigh on the stock they wait to see when the 737 will fly again and whether or not thapove pral process will impact the development of future aircraft wake up! there's a lot that needs to get done today. small things. big things. too hard to do alone things. day after day, you need to get it all done. and here to listen and help you through it all is bank of america. with the expertise and know-how you need to reach that blissful state of done-ness. so let's get after it. ♪ everything is all right what would you like the power to do?® ♪ all right

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welcome back to "squawk on the street." time for our etf spotlight i've been sent to mike santoli's man cave where we'll talk faang a little bit. >> faang is not a theme that was dislodged. a big rush back into those stocks yesterday in particular you have berkshire hathaway buying amazon. the first trust dow jones internet etf is probably the etf of any size that acts most like faang. faang, facebook, amazon, netflix, google, one third of this etf not by design. that's because they performed in such a way if you add pay pal and sales force, it is 45% this is pretty much the way it works for the last year. handily outperforming the s&p. pretty much in line with the qqq

nasdaq 100 on a year it date basis, it maintained its lead. the way to think about it is these stocks work so well on rising market, they create this buffer, this leadership buffer that doesn't really get completely away in the downturn and seem to outperform on the upside here is this last little spurt high in the last couple of days. yesterday seemed to be about auto tariffs and alphabet up 4%. doesn't seem to be necessarily following the news, just what people buy when the market seems to be going up now is apple part of this or not >> it is not in this etf this is mostly internet specific, more software than hard hardware apple if you added it to make it the other a in faang, it has been in tune, but with bigger drops, it is further from a tie by a long shot than other ones that is the interesting thing about facebook, amazon, netflix, google, all off their all time highs, the s&p is 3% or so from

the all time high, it shows you the highs are higher, the pullbacks have been deeper, but still leaves them above the market. >> thanks, mike. thanks for having me in your -- >> come back anytime. >> go back to drinking beer and watching football highlights carl, over to you. >> don't start with that's our man cave. >> i would go there too. it is not a man cave. >> of course, sara. >> we should set up a couch and some beers and hang there all day. >> we could. it is really nice faux marble. shares of cisco moving chuck robins referencing tariffs on the call, saying the company has seen very minimal impact at this point and the tariffs are, quote, absolutely baked into our guide going forward. ckn mite30 ba ia nu

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good morning, everyone i'm sue herera here is your cnbc news update at this hour. chinia china's foreign ministry says there has to be good faith treasury secretary steven mnuchin said on wednesday he will likely travel to beijing soon to continue the negotiations missouri's state senate passing a bill this morning to ban abortions at eight weeks of pregnancy. the measure only allows exceptions in case of medical emergencies, but not for rape or incest it comes one day after the alabama governor signed a near total anti-abortion bill new york city's mayor bill de blasio announcing his bid for the 2020 presidential nomination he is the 23rd democrat to enter the race he's expected to travel to iowa and then on to south carolina to campaign and a stainless steel sculpture of a rabbit has set an auction record in new york, fetching more than $91 million

the sale at christie's was the most expensive work by a living artist the art dealer bought the work for a client you're up to date, that's the news update this hour. i'll send it back down to you. >> sue, thank you very much. the president taking aim at huawei technologies in a new executive order, black listing the company from purchasing essential components from the u.s. that order part of the ongoing conversation around the trade war with china has caused more volatile in the market s&p and nasdaq positive for the week, wiping out monday's losses for more on trade and the impact we're joined by joyce chang and matt gold. thanks so much for being with us today. good to see you again. your note this week essentially says risks have been ram ped up >> we haven't changed models in a big way, we're waiting to see if these negotiations get back on track in june there are downside risks here.

we think what has already been announced is about another $2 to $3 off eps if the full set of tariffs goes through on the imports, we think this could be $8 or $9 off of eps. we're waiting to see if this gets back on track. >> you look at washing machines as an example of the overall impact on tariffs. and you found that prices went up and prices also went up among domestic manufacturers and in the end it was a hit to consumer spend. >> yes, we think this could potentially put about .2% on the level of consumer spending and we think it could take .2% off of u.s. growth the impact on china is greater if the full set of tariffs go through, this could be .8% off of growth this year and in 2020. and that's really what we're looking at is can they get the discussions back on track. this can be absorbed right now there are downside risks of more tariffs going forward. >> big question in all of this is how long the tariffs last they're just going to be used as

negotiating chip to get china to meet the u.s. demands, what is is the time frame at this point? >> i see tariff going past 2021. i think president trump dug himself into a hole here and i don't see any clear way of him climbing out of it between now and after the re-election. i think if we get a different president in 2021, they'll probably roll back all the retaliatory tariffs very quickly. i think if president trump is president, after 2021, i think he's still going to have a battle with the chinese. he doesn't have as much leverage as he thought he was going to have and he's not getting at the negotiating table the concessions he was looking for. >> what do you make of the move on huawei and its relationship to the overall discussions with china? >> well, president trump has done something that no previous president, republican or democrat, would have considered doing, which is mixing the

criminal prosecution of companies, chinese companies like zte and huawei with trade negotiations with china. that very much undermines the credibility of our criminal law enforcement process, and as a result, other presidents would never have done that but president trump is thinking less about the credibility of our criminal law enforcement and these are national security laws, national security, and more about the immediate short-term negotiations that he has with the chinese now in which he needs a win for his re-election campaign >> but it would seem to be something that they will take quite seriously. it puts huawei, certain parts of the business and some jeopardy given the reliance on u.s. technology on chips, for example, doesn't it? >> absolutely. you are correct. president trump threw away an enormous amount of leverage over china with when he withdrew the united states from the tpp he did get a little extra lefrmg from t

leverage from the retaliatory tariffs. that leverage was undermined the leverage he's getting now with the huawei prosecution and the lte sanctions is meaningful leverage in the negotiations, but it comes at a price. it undermines our considerable ty everyone in the world and even everyone in america has to wonder do these companies really warrant this prosecution or are -- is the united states trumping up the prosecution just to have leverage in the trade talks. well, i think they really warrant the prosecution, but we undermine our credibility when we make that statement if we intermix it with trade negotiations. >> how about you how do you think they respond to this >> i think it made the outcomes more binary. so i think the key issue that seems to be on the table right now is the enforcement issue the u.s. doesn't want to sign an agreement that they can't enforce and they asked for unilateral enforcement measures. i think it is going to be tricky there say risk this goes longer than what the market thinks and these downside risk scenarios

will play out. what we're really looking at is some of the indirect effects we talked about the direct effects earlier, but the indirect effects, what will it mean for confidence. >> you said capex growth could be zero, which we don't see in nonrecessionary periods. >> could you have a replay of what we have last year, you have capex growth globally go to zero so we have run the scenarios on this, but it is about 1% off of china's growth over the course of the 2019 and 2020 if this does go through. it is a lose-lose snare yes ace around right now the market is looking at the glass as being half full rather than half empty the buybacks have been very strong $70 per month first quarter earnings very good the positioning in the market is not as extreme as it had been in november but i do think you have to look at the downside scenarios because i think we very much --

it could be difficult to get this back on track given the structural issues that are under discussion. >> one last thing, one goal of all of this is to get u.s. companies to repatriate supply chains or move them to other countries. we have seen a few narrow examples do you think that will happen in scale? >> i think we're going to s see more u.s. companies moving production out of china, moving assembly out of china when they're producing the assembling for the u.s. market. i'm consulting frequently with u.s. investors who are very frequently talking about moving supply chains in almost every sector but some sectors more than others >> we'll talk again, i have a feeling. good to see you, thank you. >> when we come back, beyond meats surging again after 250% now since its ipo earlier this month. what is the traditional meat industry think about it? that's next. a quick programming note, don't miss facebook's coo sheryl

sandberg joining us tomorrow morning, 10:30 a.m "squawk on the street" will be right back

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robert shiller says the trade drama is like theater on wall street. find out what it means for the markets on tradingnation.cnbc.com more "squawk on the street" coming up.

best ipo of the year so far, you can probably guess, beyond meat, higher between this morning. up more than 250% since the debut. leslie picker joins us with a look at how investors are playing that stock leslie >> good morning, carl. most investors have been craving beyond meat, not everyone has been as ravenous for the plant-based company. the stock price has more than tripled bringing a fair share of amount of bears in currently more than a third of the company's float or shares available for trading are out on loan for investors to use for their shorting purposes. now, since may 6th when the stock has been able to be shorted, the amount of shares

borrowed has increased every single day today sits just shy of 4 million shares, worth about $340 million. the heavy demand to short has driven up the cost to do so. investors are now paying as much as 70% annualized fees that's higher than most recent ipos, shortly after their debuts lift, the outlier investors were paying 100% fees to short lift the cost has since been cut in half perhaps surprisingly uber has been on the cheaper side with investors spending only about 2.5% to short that stock but with uber's third update in a row today, maybe more bears will feel comfortable to take a dip in the short seller pool guys >> what is so striking about the rise, leslie, is the valuation this company is getting. it is trading at 64 times sales. i'm looking at tyson foods now, you know, which produces real meat that's trading currently at .73

times sales. this is a company that had recorded sales of $88 million and now trading at $5 billion? >> $5.3 billion. it is remarkable, every time they announce something new, a new partnership, something -- a new funding round for one of their competitors, that stock price just keeps going higher. but as a lot of people pointed out, the float here is very small. it is only about 16% of the entirety of the market cap is currently being traded if there is some sort of bad news or some sort of day that, you know, there isn't a positive catalyst for the stock to go higher, people could potentially start taking money off the table. >> that's an important point i think you make when is the lockup, 18 0 days out from when i would assume there is going to be potentially a -- some stock for sale and the ability to take that float to a higher level. >> yeah, yeah, 180 days minus

14, david. so that is certainly a big catalyst as well for any of these ipos because that is the first day when all of these investors who no doubt have gotten in a much lower price point than where it is trading now will be able to cash out if they choose to do so >> leslie picker, thank you. joining us to discuss how the meat industry is responding to the growth here, paul lafrieda, welcome. who do you feel about the plant-based burger craze >> it is great to be here. we love the plant-based burger craze. we were actually one of the first to endorse impossible burger so we need alternative proteins as our population rises. we will at some point not have enough commodity beef for our population so other forms of protein that

will keep the prices in check are something that we welcome. >> so you don't see it as a fad? you think this movement is here to stay? >> well, i particularly think that these products and possible burger and beyond meat are most likely fads when it comes to burgers. i think that they're not fads when it comes to alternative meat substitutes where as you could use them in other dishes and i had that in other dishes by some of the best chefs in new york city and i couldn't taste the difference putting them between two buns and making them a burger of which we are all familiar with what that tastes like, it didn't have that allure to me >> meat is still the main part and will be for a long time, i would assume, of your business, right? >> it is but we definitely see a future

in this meat substitute. one of the reasons that we were the first to distribute it in the northeast. for impossible burger. impossible burger was more on the industrial side of food service, where as beyond meat was more on the retail side. so you had two companies in the same space, but making a similar product, but in two different categories one retail, and one food service. and in the last six weeks we haven't had any supply other than impossible burger because they had a recall. so you'll see right now prices for beyond meat are probably a little bit higher than they should be. if you're basing them off of -- if you're basing the price off sales because anyone using impossible had to go to beyond, when impossible comes back online, which they will, you'll

see sales for beyond decline a bit. and the price will -- >> what about your customer base whether it be high end restaurants in new york that we know well or places like ballparks? are you starting to see them demand some sort of, you know, channel where you have to sell them these meat substitutes? >> not that we have to it is something that we actually advertise and promoted nr ed initially. i think when the restaurant groups that we sell to, the higher end spectrum, when they begin to see wendy's and, which is an amazing company, but obviously in a different category of food, they're not so willing then to have that same meat or meat substitute in this case in their restaurant so i'm starting to see a little bit of a decline in the high end

as it expands to more of the general public and more of the fast food setting, which i think the fast food setting is amazing and it is amazing that it caught on so much there but it does definitely take away from high end chefs wanting that product for their high end restaurants. >> speaking of addressable markets, pat, i would love to get your take. bernstein tried to take a crack at the total addressable market. they said if you looked at what plant-based beverages have done, and applied that to this category, you would be looking at 40 billion addressable in a decade, give beyond 5% market share and implies $2 billion in sales by 2028. does that sound like it is in the universe of the possible to you? >> it certainly does and it does in the way that i had explained earlier. maybe not in burgers, but as a meat substitute, sure, yes, i -- and the beef industry, by the

way, is not concerned with this. they are obviously watching it because of what happened to the dairy industry but in speaking to some of the biggest beef packers in the country like national beef, it is not really a concern of they know there will always be that demand for real meat and we don't really know what all the health benefits are if there are any for the plant based products there are other environmental claims being made, but when you have a meat industry that's highly regulated by the usda compared to a plant based product that's not, you, that's where the cattleman's association tried to, to stop those plant based companies from using words like meat and burger not to confuse the general

public >> zbpat, thank you for joining us. >> now to jon fortt. >> the lyft ipo a shadow on uber now is it casting a chateshadowh work or is it an issue of the ipo market or just those companies losing a ton of money wooechl dig in coming up on "squawk alley.

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welcome back i'm like to welcome my guest, michael. thank you for join iing me i'm going to march right into it economics is difficult sometimes. you can't zero in on answers science is easy. electronics is easy. turn a dimmer switch down. lights get less bright weren't tariffs supposed to be like that? yet the economy seems bright how can you reconcile that issue? >> the way i'd say is we're getting additional 15% tariffs

on 200 billion that's $30 billion on paper. that's a big number, but remember personal income is returning over $14 trillion, so we think it's something the economy can manage though i think if you're looking for a weak spot, the industrial production report this week and the manufacturing data do show a sharper decline than we had anticipated. there's some evidence there that manufacturing is just 10 to 12% of the overall economy >> would bit fair and you kind of semianswered it it would be fair to say there's a counterfactual here that the underpinnings of the u.s. economy may not be on paber as good as they were in 2018, but maybe they're a lot better than we think and should many of these head winds disappear we could see things juice up a little bit >> what do you look for acceleration i would frame it in terms of durable thety. can we keep the expansion going

at 2% or better? even with the tariffs that are coming i think the answer to that is yes. you have the fat on the sideline if we can get through these other factors. i wouldn't look for it to reaccelerate back up to three. i think the economy is slowing down towards two >> and you know, there's been a lot of stories that have captured the interests of many of my sources regarding how we deal with various inflationary numbers. probably read some of the stories, that we waited too long to integrate them and the prices drop for the last half minute we have left, does that merit some as they calibration inflation outcomes >> we have concerns as why isn't inflation stronger given where the economy is, but we've had literally like a half a dozen reassessments by the bhs and how we measure certain categories.

i think measurement is an issue. it helps explain why it's been softer as more research on the part of people like me and from the fed. >> excellent michael, real pleasure your first time. i'm going to have you back b enjoyed that sarah, back to you >> all right, rick thank you. coming up later today on the closing bell, verizon' ceo will be joining us to talk about president trump's wa way order also some major earnings on tap. nvidia, bau,inrequid ptest "sawk alley" is up next though we'll be right back. -driverless cars... -all ground personnel...

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