a monster defense deal topping your five at 5 on this monday morning raytheon and united technologies, they are teaming up in an all stock merger. the details on that big money tieup straight ahead. treasury secretary steven mnuchin went on the record why he says, america, quote, is perfectly happy hitting china with more tariffs. in the meantime, hundreds of thousands of protesters spilling into the streets of hong kong. they're angry about a proposed power move by beijing. we'll tell you what that is ahead. your stock investments coming off their best week of the year

will a new week bring a new theme or are there new gains ahead. lucky you, we are kicking off a new series on the interest rate shock more important, what you should be doing right now it is monday, june 10th, and worldwi "worldwide exchange" begins right now. ♪ ♪ well, good morning, good afternoon or good evening and welcome from wherever in the world that you may be watching us i am brian sullivan. so glad to have you with us on this monday. happy monday because it is a good morning for stocks here and all over the world today u.s. stock futures are up 90 points right now nasdaq and s&p futures are also higher coming off the best week of the year. this after the united states struck a deal over the weekend with mexico to avoid new tariffs. the question though is can this loose deal really last it is a good question, and we've

got answers and great guests coming up on that. right now, to the $100 billion story of the day raytheon and united technologies are merging. it will suddenly create a bohemouth in the aerospace business the new company will have a market cap of more than 100 billion and annual sales of about $74 billion. it will become the second largest aerospace and defense company in the world behind boeing and they will make everything from jet engines and cockpit controls to tomahawk missile. the connecticut based united technology will control the company, about 57% will be headquartered where raytheon is located outside of boston. watching shares of both companies and investors like the news on both sides the stock is up 5% and raytheon is up nearly 3% on that news joining us on the cnbc news line is our own morgan brennan who covers the space and knows nearly more about it than

anyone it's great to have you this morning. this is a big deal what is your reaction to this merger >> reporter: hey, brian, good morning. talk about merger monday, wow. there are a lot of people who are very stunned to hear this news breaking over the weekend, especially folks who are invested in it but in many ways it does actually make sense. we mentioned it's going to create a company that is valued at more than $100 billion. it is an all stock mergers as well united tech ceo brett haze is going to be the ceo. tom kennedy will be chairman for the first two years. expecting to close in the first half of 2020 that will be when united technologies is spinning off the otis elevator and carrier hvac units. when that spinoff happens is when you'll expect this deal to close. in addition to it being the second largest air and space

company behind boeing, it's going to be the biggest defense prime. it really does, as you mentioned, bring together poo poo% defense it will be bringing together many different parts of the supply chain and many different programs raytheon's the largest producer of missiles and they have their hand in every major missile defense program out there as well as things like the tomahawk, hyper security and all of the next generation technologies that the pentagon is looking to develop more. >> morgan, i know when these deals happen they love to say we're a merger of equals sounds like this is really united technologies taking over raytheon >> reporter: they're going to have the larger stake. we're going to be hearing more about this there's an 8:00 a.m. investor call and then the ceo will come out and do some interviews

yeah, you're talking about $1 billion in annual cost energize by year 4. 18 to $20 billion of capital return to investors in the first three years. i think the two of them are billing this as a merger of equals i don't think the way they're thinking about this is as an acquisition. i think they're really thinking about this as a combination, in large part because there is no overlap, very little overlap between these two companies. it is very much a horizontal merger and you're bringing together some very different programs and portfolios. >> if you're lockheed martin, what do you do now >> oh, that is going to be the key quo. if you're lockheed martin, general dynamics, if you're general dynamic, if you're honey well, any of the midcap companies out there that have been stand alone and been speculating about being acquisition targets, this is going to drive a lot of questions. a lot of competition to the

space which is a big reason why i would expect and many analysts will get the detail. >> is there anything there in the quick analysis that they're going to have to spend to get this deal done >> reporter: i don't think you're going to have to necessarily see much of that here it wasn't anything that was disclosed in the press release in some ways i think the boeing template is the one to think about here, the fact that they had a commercial aerospace business and it's been a cash cow that has grown over the years. in many ways, it's been able to sort of cross subsidize some of the defense business and help them bid very, very aggressively and win some very high profile contents in recent years i think that could be a very similar model to play out here. >> morgan brennan, i know you have a big day we'll let you go look forward to seeing your coverage here on cnbc, thank you. >> reporter: thanks, brian. coming up later, a first on

cnbc interview with greg hays and tom kennedy. that big interview coming up at 9:00 a.m. eastern time. turning to your other big story of the morning, that's trade. the u.s. striking a deal with mexico to avert a round of tariffs. steve mnuchin sitting down with cnbc let's get to nancy hungerford. she spoke with the treasury secretary. nancy? >> reporter: hi there, brian i did, indeed. no doubt about it, secretary mnuchin saying all of the finance ministers meeting here for the g-20 meeting were happy about that news around mexico. for the japanese, the automakers weren't happy.

they were very concerned about the u.s. and china and where we head from here i asked secretary mnuchin about what went wrong. here he was meeting with the pboc minister for the first time that's critical. we spoke to him after that meeting so i did ask for more information on where we stand today. take a listen. >> i think we were -- we had a deal that was almost 90% done. china wanted to go backwards on certain things we've stopped negotiating. if china doesn't want to move forward, then president trump is perfectly happy to move forward with tariffs to rebalance the relationship >> reporter: so there you have it the comment from secretary mnuchin saying they are very happy to move forward with tariffs if those talks in osaka don't go well. we're talking about some two weeks from now president trump

has confirmed he will be meeting with president xi jinping. perhaps there won't be a landmark deal but what needs to happen that's the question i put to secretary mnuchin. >> i think just like last time, we're going to need to see action and president trump is going to need to make sure he's clear that we're moving in the right direction to a deal. in the case of buenos aires, we came out of that we had direction from two presidents he put the increases on hold the president will make a decision after the meeting >> reporter: it's your expectation we could see that once again, on hold if we can't get a deal >> if -- i believe if china is willing to move forward on the terms that we were discussing, we'll have an agreement. if they're not, we will proceed

with tariffs. >> reporter: there you have it, brian. the message is a clear indication that the chinese side is willing to move ahead with the terms that the u.s. was previously seeking he didn't need that. >> nancy, quickly, did he address huawei >> reporter: he did, indeed. and the secretary mnuchin did want to make very clear that he thinks huawei is a separate issue from the trade tensions, especially when you consider all of the national security implications he said clearly national security is separate from trade. i said to him, the president has said they are linked president trump has said it could be part of a trade deal. he said what the president means, if they make progress on trade then president trump may be willing to give concessions to huawei. the umpt s. black listed huawei

after the trade talks won't be part of the discussion in osaka. joining us to talk about the markets, coming up by the way, their best week of the year is timothy horberg. deals, trade deals, big defense deals and coming off our best week of the year for equities. it's like a new month and a new mood to what do you ascribe the big mood what changed >> when we look at the tone, really over the last few weeks leading up to last week it was one of increasing pessimism. i think the feds' statement, chairman powell coming out and saying, look, we're watching this closely and we're willing to be flexible really shifted risk sentiment last weekend in the market >> should it if the fed is cutting rates, they're afraid of a slowdown or

lack of inflation. a rate cut is not supposed to be a good thing seems like it's become that. >> you're right. when we look at a rate cut historically, that hasn't been a good sign of the u.s. economy. in this case this looks like the fed wayieighing on economic activity and sentiment this is chairman powell saying we're sensitive and we're here. >> it's amazing, december we collapse, january we come back, we have a good year. may we don't collapse, we fell heart tilly. now june coming back why the volatility got to be frustrating and difficult to manage through. >> absolutely. i think when you look at historical return in market periods, i think one of the worst periods is uncertainty when we think about good outcomes, bad outcomes, uncertain outcomes, one of the

things that weighed on this and contributed to the volatility is a little bit of seesaw, what are some of the policy stances of the u.s. around trade. i think that contributed to a lot of that volatility and why it's been a risk on/risk off. >> what do we do now >> when we think about our positioning, it'sstill largely the same as where we are when we started the year, which is going where the growth is. focusing on -- >> where's that? >> in general still on the growth side. if you're looking at growth value from a style standpoint, looking at the emerging markets from a regional standpoint as we think about where the best growth opportunities are even amid some of the uncertainty. >> is emerging markets still the best >> right now we think so when you look at emerging flarkts a valuation standpoint or even stable and weakening given the lower rates that we've seen this is one of the better plays.

>> timothy, great to see you on this monday. >> bright and early. >> give us another week like last week. >> i'll try. when we come back, china heating up massive protests in hong kong. eunice yoon will break down why people are taking to the streets. plus, the rate shock and your money what tumbling interest rates mean for stocks, housing and trillions of debt. it's a week long "worldwide exchange" series that kicks off today. a last minute deal for tariffs what james jones has to say when ghafr isk exchange" comes bac rit teth

at comcast, we didn't build the nation's largest gig-speed network just to make businesses run faster. we built it to help them go beyond. because beyond risk... welcome to the neighborhood, guys. there is reward. ♪ ♪ beyond work and life... who else could he be? there is the moment. beyond technology... there is human ingenuity. ♪ ♪ every day, comcast business is helping businesses go beyond the expected, to do the extraordinary. take your business beyond.

welcome back there is a live shot of hong kong 5:16 in the evening there. looks calm but earlier it was chaos. hundreds of thousands of people taking to the streets of hong kong they are protesting a new policy on exportation what exactly are they so angry about? >> reporter: well, brian, you know as many as 1 million people, that's 1/7 of the entire population of the city, took part in this march in order to pro protest the former extradition law. these changes would help propose a loophole to the city's law on a case-by-case agreement to places where they don't have

agreement, such as main land china. they are suspicious that beijing would only extradite opponents to the chinese government who reside in hong kong to main land china for trial or maybe even something worse. today hong kong's leader, kerry lamp, she said passing the bill was necessary to fight crime the foreign ministry blamed, quote, foreign forces for intervening. they have expressed concern about this new bill. the international business community weighed in they said the credibility of hong kong is now on the line and the bill, brian, moves to parliament for debate on wednesday and as you could imagine, that entire report that i just had, including you, it's all been heavily censored, completely blacked out. >> completely blacked out in china. that is beginning to be an

uncomfortable trend there, eunice, every time you pop on the air. >> something that won't get blacked out, china trade data. how did that look? >> reporter: the trade data actually looked pretty decent especially the export figures. so the may export beat expectations it appears they've been fron loading shipments after they said the u.s. could slap tariffs on $300 billion worth of goods the numbers came in this way exports jumped 1%. imports also suggested weak domestic demand. it shrunk by 8.5%. that was much more than what was expected and so most analysts are now predicting that this weakening global demand as well as a trade war is going to really hurt the chances of a recovery in the second half of the year. >> can i say something, eunice

i want to say thank you. i mean that sincerely. you have to walk this line that we don't have to worry about here you have to walk this line, your feeds get blacked out. we're glad you're there. thank you. >> reporter: you're welcome. >> i laugh every time i see your face it's become a meme in the office eunice, thank you. >> reporter: yeah. still on deck, it is a deal set to create the world's second biggest aerospace and defense company worth more than $100 million. we're going to look at his instant reaction ahead. the latest down draft in bond yields. the special rate shock it's coming up when we return after this moving is hard.

no kidding. but moving your internet and tv? that's easy. easy?! easy? easy. because now xfinity lets you transfer your service online in just about a minute with a few simple steps. really? really. that was easy. yup. plus, with two-hour appointment windows, it's all on your schedule. awesome. now all you have to do is move...that thing. [ sigh ] 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.

welcome back good monday morning. stock futures are higher by about 100 points higher. coming off the best week of the year for stocks. we're seeing that momentum continue on. let's get a check on this morning's other top headlines including baseball legend getting shot in his home country. nbc's phillip mena is in the newsroom. >> shocking news, brian. good morning red sox legend david ortiz was shot in the dominican republic the former red sox slugger was in the capital of santo domingo when some men arrived on a motorcycle and ambushed him. this morning he is in stable condition. one of the suspected assailants was captured by the crowd and beaten up. the other, meanwhile, escaped and is still at large. a tragic accident in dallas.

one person was killed and five others injured when a massive crane crashed into an apartment building and garage. this video here showing the devastating aftermath inside the parking structure. a powerful storm was rolling through dallas at that time and a peek wind gust of 71 miles per hour were recorded less than 15 minutes before that crane collapsed. the st. louis blues, they have the worst record in all of the nhl on january 2nd and now they have a chance to win their first stanley cup. all they needed was a game six victory over the bruins but boston set the tone early. they had a first period goal and the bruins would score three unanswered they ended up winning the game 5-1. that forces a game 7 all the marbles, brian, that's going to be wednesday night on nbc. there's little better than game 7s in sports. >> hopefully the blues can pull it off boston, they haven't had any sports championships at all. i would hate to see them go six months without winning some kind of a championship.

>> i know. the pride. >> yeah, phillip, thank you very much. >> all right. coming up, stocks coming off their best week of the year, but your next guest says there is one big thing out there that could scuttle it all. plus, we have a deal but will it stick? the former u.s. ambassador to mexico who is a key nafta ambassador james jones will join us when "worldwide exchange" returns (osamah) cancer is... the ugliest disease mankind has ever faced. (henry) i thought it was unfair. when-- when you hear those words that you get diagnosed with cancer. (osamah) successfully treating it still remains one of the most enormous challenges facing us today. we realized that, if we developed the technology

that could take 2-dimensional patient imaging and convert it into 3-dimensional holographic renderings, we could enable surgeons to dissect around the cancer so we can precisely remove it. when we first started, we felt like this might just not be possible because computing power just wasn't there, but verizon 5g ultra wideband will give us the ability to do this. we won't rest until we see this technology being able to change lives.

you mighyour joints...ng for your heart... or your digestion... so why wouldn't you take something for the most important part of you... your brain. with an ingredient originally discovered in jellyfish, prevagen has been shown in clinical trials to improve short-term memory. prevagen. healthier brain. better life. defense stocks could take off like a rocket and because you have a $100 billion megamerger this morning, raytheon and united technologies teaming up, who could be next? mnuchin on the record. treasury secretary sitting down

exclusively with cnbc. what he said about a china trade deal that every investor needs to hear. we're kicking off our week long series, the rate shock. we'll break down how it could impact you and your money ahead. it is monday, june 10th. you're watching "worldwide exchange" right here on cnbc all right. welcome back thanks for being here with us on cnbc i am brian sullivan. good monday morning. it looks like a pretty good monday morning for stocks. momentum carrying forward for the futures and for right now. dow futures are up about 95 points right now of course we'll talk more about the markets and your money coming up in just a moment but, first, breaking news raytheon and united technologies agreeing to an all stock merger that will create a company with a combined market cap of $100

billion. it will become the second biggest aerospace and defense company in the world just behind boeing both stocks are higher on the news utx up 5% and raytheon up almost 3%. on the trade front, the u.s. striking a deal with mexico to avert a new round of tariffs treasury secretary steve mnuchin praising the deal with cnbc. he talked about trade tensions with china he said more tariffs on that country could be coming. >> if china wants to move forward with the deal, we're 3r50e prepared to move forward on the terms we've done if china doesn't want to move forward, then president trump is perfectly happy to move forward with tariffs to rebalance the relationship. >> joining us now is evan browning, head of macro asset strategy at ubs. evan, welcome. we are coming off our best week

of the year and that was before we had this mexico deal. of course the president announcing that over the weekend. why this sudden change in tone for the market >> i think a lot of it has to do with sentiment and positioning right after the may 15th reignition of the trade conflict you saw a lot of people leave the market that left the market very vulnerable once we gotten couraging words, you had the kindling in place for a bit of a bounce back. >> is this mexico deal a little fire on that kindling, gasoline being thrown on it >> it may help in the very short term but i think as we look forward we have to think about the permanent damage being done by the uncertainty it's not that we have this deal and it's in the all clear. we know that president trump is saying, well, if this mexico

deal falls apart, we could have mortar riffs the precedent being set that tariffs could be announced at any time as a justification for some economic nontrade base goals. let's be clear you heard the treasury secretary talking about raising tariffs again on china is the market underestimating some of the geopolitical risks here >> i think the market is getting accustomed to those geopolitical risks and is understanding now that at any time you could have these flash warnings come up that's a big problem that has to weigh on animal spirits the same way tax cuts boosted animal spirits you' you're seeing a pulling back. >> do you think we're going to

get a rate -- do you think we're going to get a rate hike maybe i did ask it right do you think we're going to get a rate cut maybe i'm having trouble because i can't believe i'm asking it. >> not that long ago we were talking about hikes this year. no, a rate cut june is probably too early because it comes before the g-20 you don't want to be the fed, cut rates and all of a sudden there is a deal with china you looked preemptive and you looked like you were caving to the president on that. i think it's more likely that it's a july or september. >> let's be clear, one year ago, go back a year, on this very set, most of our guests, i love them all, were calling for 3 to 3.5% yield in the ten year and a series of hikes as well. the market is up 12, 13% this year and yet now we're talking about cuts how surprising has that change been to you?

>> it's been surprising. there's a couple of people who have talked about low yields, not many >> we have seen a turn in the data we expected some turn in the data we have the tax cuts boosting growth, 3% last year we knew we were coming back towards 2% it's been very quickly that the global economy will weigh on the u.s. the u.s. economy, we're starting to see some softening daft at that it makes sense for the fed to be a little more cautious. >> evan, a pleasure. thank you for bailing me out appreciate that. let's turn to your other big story of the day and that is mexico president trump announcing a deal of some kind that would suspend all tariff threats, quote, indefinitely. in return, mexico agrees to take stronger measures on immigration. mexico also agreeing to begin buying larger quantities of u.s.

agricultural products although the exact details are few and far between. most jarring is the president is leaving the door open to tariffs if, quote, for some reason mexico does not stick to its word joining us now from washington d.c. is the former u.s. ambassador to mexico under president clinton. he was a very key negotiator in nafta. james jones. great to have you on "worldwide exchange." >> thank you very much. >> what do you make of this deal do we call it a deal >> i don't know that we call it a deal the two sides, the two governments have been talking for several months now about the problem of unlimited immigration. it's a problem for both countries. mexico on their southern border and us on our southern border have unprecedented number of migrants wanting to get into the countries.

it's a dual problem. what they have agreed to is, number one, mexico has reorganized its migration services, its police forces and they're going to put around 6,000 troops on their border to try to control and manage this problem. mexico, if the united states, mexico and canada will pass the new nafta, usmca, then there's no question that mexico will be buying more agricultural products from the united states and that trade will actually grow so everything is going to work out well if we can get back to normal relations and separate the immigration problems from the commercial problems. >> you wonder if we see a continued pace of migrants, what's to stop the president from doing this again,

threatening tariffs once again there's no hard and fast deal yet? >> i think first of all president trump has as a favorite tool tariffs on almost any kind of problem and i hope that that will subside in the future because tariffs really don't apply to immigration issues they apply to commercial issues. commercial issues we don't have right now. i don't know what the president will do in the future, but the fact is that both countries, both governments are working together they're trying to solve this immigration problem. the united states side, what we really need to do is to add immigration judges because the asylum laws require things that cannot be changed. those things have to be interviews of the migrants to find out if they truly qualify under the asylum laws and that

takes a certain amount of time it takes a certain amount of time and it has to be processed. so what we need to do is to beef up our process what mexico needs to do, which they have done, is to beef up their course so they can control and manage the migrant problem. >> all of this, ambassador, of course, as they're trying to get through the finalization of the new nafta, if you will, the usmca. trade is huge but control of that is petroleum products china gets all of the attention. can you put into perspective just how big and important the u.s./mexico trade relationship really is? >> it's our number one market. mexican market buys more goods and services from the united states than any other market in the world so it's very important that we protect, preserve and expand that particular market. it's -- it also leads to a very good relationship on

governmental matters i believe that good business leads to good neighbors. >> former u.s. ambassador to mexico,james jones we hope to see you again soon. >> thank you very much when we come back, the rate shock and your money the three reasons behind the recent fall in bond yields and what tumbling rates mean for you. our special series will kick off next plus, how the biggest defense deal in history could change that industry forever. later, the one factor that could change america from any kind of sharp economic downturn. o inones talking about it we will. it's a good news story and we've got it

all right. good morning and welcome back. happy monday dow futures are up 92 points right now. well, despite almost nobody thinking they would, interest rates have been in a free fall lately the yield on the ten year treasury note touching at the lowest level in years. that precipitous drop could have an impact on your money. all this year we're digging in on the rate shock and breaking down how it impacts your latest investments. we have a look at what is behind the biggest drop in rates. steve liesman has some answers three reasons behind the latest downdraft in bond yields. first, inflation is consistently coming in below the fed's 2% target and it looks to be falling further. second, growth is expected to

weaken, maybe a lot depending on how new tariffs on china and mexico play out in the broader economy. third, low inflation and weaker growth are forecast to combine to cost the federal reserve to cut interest rates how much have rates fallen from the presidential election to the peak of rates under president trump the benchmark ten year yield rose by 140 basis points call it 1.4 percentage points. since november 2018 yields have fallen 115 basis points. that just about wipes out all of the post election increase it's been a powerful bond rally. it will need to be confirmed by economic weakness, low inflation and fed rate cuts to be sustained. and our thanks to steve liesman. so there is your macro setup the question is, where do rates go from here joining us now is sri kumar live from los angeles we know it's a big day to get you on live from la, sri

i said almost nobody had called for this downturn in rates you and some of the other southern california bond mafia, if you will, you guys got it right. what did you, sri, see that led you to believe that rates not only have fallen but that will continue to fall from here >> the recent rise and fall, first of all, this is not a short term issue this started from 2008 onward. it was clear to me at that stage that the way in which the quantitative easing was done and we went for zero interest rates for a long period of time, we were not going to have a growth recovery second, the way in which it has done, wage increases have been low. stocks have been higher. those are two major reasons and that does not change, brian, until the changes i look for

rates to continue to go down further. >> we're going to hit the story from consumer, corporate debt, housing. if our viewers are out there anything about taking a major loan for something, do you believe rates will continue to done from here could we go below 2% on the ten year >> i'm looking for the ten year to go well below 2% even though the yields have done up today as a result of the mexican trade deal being achieved. as you said a few minutes ago on your program, brian, the president can reassert tariffs and the mexican deal is at risk. if the democrats do not approve of a usmca or nafta ii in the house. for both of those reasons you have the risks still there you have the china trade risk that the tariffs may be enforced all of this says to me that you want to hide in a safe haven and

the yields are going to go down further. for your viewers who are watching, do not be a market timer if you are looking for a mortgage, ten year, 30 year mortgage, you are at a great rate right now you may not want to wait for the absolute bottom. this is a very good time to go and do it. >> also there's been this talk, sri, about china could dump our treasuries as some kind of a punishment for the trade fight there's been so much activity buying bonds who exactly do you think are the buyers of treasury >> that's a great question, brian. if the chinese were to dump pressure, which i don't think is going to happen, if they do, that would be amount to such a big increase in global risk that the private sector demand for affording treasuries will more than offset what the chinese are going to dump. so, once again, as i've been saying on your program in the

past, counter intuitively the yields will go down, not go up. >> sri kumar, there's two or three people out there in the world who have gotten it right we appreciate you coming on. >> thank you for having me. >> the late, late, late, late show still on deck, what the $100 billion deal means what are you going to do now plus, why it's not all doom and gloom. wethe erang factor that could por amic economy for years to come.

the first survivor of alzheimer's disease is out there. and the alzheimer's association is going to make it happen. but we won't get there without you. visit alz.org to join the fight. hey! i live on my own now! i've got xfinity, because i like to live life in the fast lane. unlike my parents. you rambling about xfinity again? you're so cute when you get excited...

anyways... i've got their app right here, i can troubleshoot. i can schedule a time for them to call me back, it's great! you have our number programmed in? ya i don't even know your phone anymore... excuse me?! what? i don't know your phone number. aw well. he doesn't know our phone number! you have our fax number, obviously... today's xfinity service. simple. easy. awesome. i'll pass. welcome back good morning 5:48 on the east coast if you are just waking up, wow, we have got a big deal in the defense space. raytheon and united technologies are teaming up in an all-stock merger the new company will create america's second biggest defense and aerospace company with combined sales of about $74 billion. the free market loves it joining us on the cnbc news line is roman schweizer it kind of came out of a blast from the corner here, but the

deal is out there, roman first and foremost, do you believe the deal will get through regulatory scrutiny? >> yeah, hi, brian, good morning. yes, i do. there's really little direct overlap between these two giants it's really a merger of a large aerospace company that has some defense and a large aerospace company so i don't think it is but they're separate but equal. >> who's next. we're looking at you, lockheed martin if you're general dynamics, honeywell, or even ge, what do you do this morning? >> i don't know you need to do anything what's really interesting about this is this is really the first big crossover. over the last several years you've had a lot of big mergers in aerospace, you've had some

m&a and this is one that creates a solid blend and a true a&d company, that's about 50/50 in terms of revenue boeing over the years has skewed one way. north tl northrop has skewed the other way. i'm not sure who does this. >> stocks are up and the stocks of utx and raytheon are up in the pre-market should investors be happy with this deal? >> yeah. look, the companies are going to talk later this morning about the merger synergies and the overall economic benefits of the deal you know, i think that's something folks will look at and digest as the day goes on but really more broadly it puts a diversified company together that has counter cyclical protection has some heft, a lot of international exposure as well you know, so really it should be

able to compete strongly in two decent and growing market. >> roman schweizer, we appreciate you taking time for us this morning. thank you very much. >> thank you. roman said you're going to hear from the c oheos. we have a first on cnbc with both of these guys coming up on "squawk on the street" at 9:00 a.m. eastern time let's get a check on how the markets are setting up their day coming off the best week of the year for stocks, believe it or not, last week, we're seeing futures higher again just under 100 poents. the nasdaq and s&p are also higher as well may was a may to forget. suddenly june. there may be a much, much, much longer term trend out there. could be some good news.

et cetera wi let's get good news. i love, love, love this topic, ellen. >> i do, too >> it's so -- 40 million more millennials than there are our generation out there. >> yeah. >> gen z is huge they're millennials. >> we know they're buying homes now, too >> live in brooklyn and ride a bike no, they're not. once you have a kid crying in the next room, you want -- >> you move to westchester that's what happens at morgan stanley. everybody goes to westchester and starts having kids. >> yeah, exactly how big is that going to be from a macro economic stands? >> if we take a longer term view, as you said, gen x, we didn't hold up our end of the bargain. >> we're worthless. >> here's gen z. the leading edge are graduating from college

they're going into the labor market they're hitting at a labor market at a time when we had the tightest labor market. gen z will be jumping out there and competing for housing. we will be under building multifamily. just the sheer size and it's bullish for gdp, a secular bull market for u.s. equities it means we're putting the floor under long term interest rates we're not going to be japan. it's long term bullish. >> numbers 2 and 3, they have student loan debt, they'll get married. >> they're much better equipped to pay back the student loans compared to millennials. they won't have to delay purchasing decisions. >> especially if rates stay low.

>> exactly on the global stage, how do we compare? no one across g-10 comes close to this. the youth movement will stay massive. it will dominate in the 2040s. we have labor force growing about 1/10 faster than the cbo that doesn't sound like much when you look out there, it delays the insolvency by 30 years. these things matter. matter a good deal and we just don't focus on them. >> by the way, if you're not listening, if you are a gen xor, this is great news for us, right? we're going to have 40 million more people working when we're retiring. >> exactly. >> we should be okay you mentioned equities you are always biased. there are 50% fewer stocks now than there were 20 years ago there's 40 million more potential investors out there. 40 million more buying a pool of

assets that has shrunk as private markets have grown is that a long-term, big bull case story >> it's a multi-decade story. >> we're talking long term. >> yeah, we're talking long term getting away from the short termism that we have right now, which is understandable with so many things buffeting the expansion right now. this is multi-decades of a long-term story. economists will tell you that demographics make the world go around this is huge because it sets the u.s. apart, terrible. >> they're horrible. other g-10 partners of ours -- >> italy has a negative birth rate japan's boom time -- a lot of people remember the 80s, 90s do you know why? because the majority of population is older.

>> hispanic is the fastest growing segment in the u.s fastest growing for total population it's the fastest growing in the gen z demographic. they are the majority in that demographic. we owe that benefit partly going back to ragan's amnesty program in the 1980s this is how you don't know the consequences of your action in terms of decades later we want to be sure we don't hamper immigration today because we could find out in a few decades from now that that is actually hurting u.s. growth >> last year the impoverished migrant today could be the business creator tomorrow. >> exactly. >> going in and creating wealth. economic fortune. >> undocumented immigrants, help them become more full economic citizens, buying homes, having bank accounts. >> i love it the good news long term story.

good way to start the day. no rbi today that was a good news story awbo picking up coverage dow futures up 100 $100 billion deal. see you tomorrow

there's just one thing hurting us millennials more than student loans: credit card debt. but with a personal loan from sofi, you can consolidate your credit card debt into one monthly payment.

get your money right with sofi. good morning a deal you've probably gotten wind of. united technology and raytheon making a deal. president trump suspending the tariffs on mexican imports after the two countries reached an agreement. plus, a big market rally the dow is on the first five day winning streak since january 5% last week 5% 5% in a week funny, it's always darkest before the dawn. remember monday last week? future