the court gesture. thank you very much. >> thank you >> dow futures are off about 65 despite the fact that there are two reports of ships attacked or on fire in the gulf of ohman "squawk box" will have more on that "squawk box" begins now. good morning breaking news. two tankers reportedly attacked in the gulf of oman south of iran the u.s. navy is assisting retail ers surging. we'll tell you what's driving premarket gains for lululemon. and the company formerly known as restoration hardware also moving up we are on unicorn watch for another ipo for tomorrow it's thursday, june 13, 2019 "squawk box" begins right now.

♪ he. live from new york where business never sleeps, this is "squawk box. good morning welcome to "squawk box" on cnbc. i'm becky quick along with joe kernen andrew is off today. we've been watching the u.s. equity futures, things are still in the green dow indicated up by 60 points. the s&p up 7 and the nasdaq up 27 the dow and the s&p 500 for the month of june are still holding on to their gains. for the month, dow above 26,000. look at what happened overnight in asia. the nikkei was down by a half

percentage point the stocks were flat for the hang seng and shanghai composite. in europe in some early trading, there are green arrows across the board. the biggest gainer of the three major averages is the dax in germany, up 0.4% in italy, stocks are up 0.6% watching the treasury market in the united states, the ten-year is yielding 2.112%. the u.s. navy is assisting two tankers reportedly attacked in the gulf of oman. according to the fifth fleet, u.s. navy forces in the region received two separate distress calls overnight. no word on who is responsible for the attack just last month four oil tankers were damaged in the same area, both saudi arabia and the u.s. blamed iran at the time for those attacks. iran denied any involvement.

crude is higher on the news. you can see that pop beginning at 2:00 a.m. eastern much more on this story later in the hour at least it was under 50 when -- or just over 50. getting close to a 4 handle on oil before this. >> oil prices were down yesterday because of concerns about stockpiling in the united states again prices are higher this morning as we continue to hear some of these reports. we'll give you more information as we get updates on them. the four attacks that happened were a month ago, may 12th these two ships were not saudi arabian ships. one was a norwegian ship and the other was a japanese owned ship. they have taken both crews off and they are continuing to monitor the ships.

vichina's vice premiere is calling for more government measures he suggested that beijing would unveil more policies to bolster growth amid trade pressures with the united states. he said there are some external pressures, but that those would help china boost up reliance in innovation and accelerate the pace of high speed development. reuters is reporting that alibaba filed for a hong kong listing. it could take place as soon as the third quarter of this year alibaba shares this morning are up by 1% big celebrations here and in st. louis. you're not even from st. louis, are you? just totally anti-boston that would have been three big championships in eight months or

something. nobody deserves that the blues took home their first ever stanley cup with everything on the line in game seven in boston -- oh, that must have been something to see -- the blues scored two goals in the first period and never looked back. it wasn't close for a seventh game would have been better if it was 4-3. the blues outscored the bruins 4-1 to bring home the first stanley cup in st. louis history. you know who is probably happy bullard. i'm sure he would be sticking his chest out. >> st. louis fed president >> yeah. can they light up the arch or something? >> i bet they do i believe they can and i bet they do. >> what does this mean for the raptors, do you think? >> what? can another team that's never won win?

>> over a dynasty. can it happen again? we'll see. >> you're always rooting against the favorites. that's sad >> and golf starting again today. >> this is coverage that we have if you don't like the masters coverage, where they only show you the afternoons and stuff -- >> it's foggy out there today. >> i looked at coverage, there's like 12 hours a day. >> he's been watching all of it. >> people in my house get so irritated. they're like you're kidding, right? >> it was practice rounds yesterday. >> pebble, you know -- >> i like pebble >> there are times in the thursday round, it's not crucial or anything. but just we put -- we get to play >> i like watching it because i know where they are practicing >> every blade of grass we've seen out there it's such a beautiful place.

we know the holes. dustin johnson, talking about him. talking about rory any way, let's keep talking about hockey >> listen to this. hockey last night, one blues fan is celebrating a huge financial win. the fan placed a $400 bet on the blues to win the stanley cup back in january. and that is paying off with the blues victory that fan will take home $100,000. as you can see he celebrated accordingly. he was with friends. they were popping champagne. $100,000 >> wow >> congratulations >> that's nice. coming up, rate cut debate, we'll talk about what the fed could do at next week's meeting that could have an impact on your portfolio. and this morning's movers include big gains for the biggest name -- they're not just yoga pants they're not just yoga pants.

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broader markets paused for a second day didn't turn into a rout yesterday, but it was lower after what looked to be positive early on while some say a fed cut next week is already priced into the markets, our next guest is still unconvinced that economic conditions are bad enough to warrant a rate cut but we already decided again and again and again hans -- in fact, just yesterday, don't know if you got to watch, some of our guests were saying it's not about the economy. clearly not about the strength of the economy it's about inflation you don't need signs that the economy is weakening just that inflation is staying below the fed target and that itself is enough to bring about a cut. you don't buy that >> no. i think the inflation rate has

been bouncing around the fed target now for some time it will run 1.8% year over year, 2.2% year over year but stable it's been stable inside a band around 2%. if you are running a business, you can plan for that. you can plan for that. roughly 2% inflation, if it maintains itself, is workable for corp pralorate america. i don't think the fed needs to react to a slight downtick in the rate of inflation. what is going on with sovereign? what are they indicating and fed fund futures, why is everyone so -- you're the only one -- do you feel in a position to dispute all these other metrics? >> yeah. ike like a voice crying in the

wilderness, i guess. when you look at the data, things like the nifid survey, still strong that was a nice tick up earlier this week. hiring plans are still good there. even the employment number, joe, when you look inside the numbers there, probably was more of a statistical fluke. roughly 10% of the time you'll have a number plus or minus 100,000. that's what happened so in the totality of it, i think without a doubt the economy is slowing down but not enough that necessitates a rate cut. i think that will be the surprise next month. that is not priced in. >> for the economy, you sound much more bullish than a lot of people have. i guess that makes you bullish on the stock market? >> i am bullish on certain sectors. if you think about the market

overall, we have talked about this before, i think we'll end between 2800 that's the good news it's down from where we are now, which means i think we'll have a tough summer prices will get pushed around because the impact of the tariffs, the policy uncertainty which is at levels we have not seen since the depths of the financial crisis, those will start to have to get re-priced into equity. not as good as it has been of late, but still pretty good. a solid year overall >> which sectors >> defense, interestingly enough i thought the ratheon purchase, which we own, i think that's indicative that the need to invest in defensive capabilities

remain pretty dire, if you will. so i think that area, while it's not cheap, represents a decent opportunity longer term. and then i think other opportune ties that are presenting to invest right now, the uk market. i think we are about to see them make a decision one way or the other. either they tumble out or they don't. and my guess, my bet is that it won't be near as bad as forecast and that will present an opportunity for investors. >> so no rate cuts in 2019 is that what you're saying >> if there is going to be a rate cut -- i don't think they need to do cuts. >> that's your view, but do you think there will be rate cuts in 2019 >> yes

i think that's right if we get anything, it will be on the back end of the year, when it becomes painfully obvious that it is needed or not. i don't think it's going to be needed at this juncture. >> what is gdp going to run for the year ballpark? >> i would have said 2.5%. somewhere between 2%, 2.5% you have to mark that down a half percent with the tariffs. just with china. >> a whole half point comes off because of china >> yeah, up to 0.4, 0.5. get a half year of that. maybe it's 0.2, 20 basis points if you put it on an annual run rate >> close enough. hans, we got it. thank you. when we return, morning movers including retarilers in

the premarket training. and much more on the reported tanker attacks that sparked a jump in crude prices overnight. right now crude prices up by about 3% we'll tell you more about the suspected attacks when "squawk box" returns

time for the executive edge. and we'll start with some stocks to watch lululemon reporting better than expected first quarter numbers thanks to strong growth from its online business and sales of leggings and jogger pants. the retailer is also raising its guidance for the year. a lot of it is these pants >> those yoga pants you're wearing. >> are these yoga pants? >> they're stretchy and they breathe. >> aren't yoga pants something fundamentally different? you're just yanking my chain >> yes and you wear makeup, too >> i do. it doesn't really help, but sometimes i think it hurts >> i agree i agree. i take it off the second i leave the set. >> and i use a dark black shoe polish on my hair. >> attractive. >> to make sure there's no gray. as you can tell on all the

shots. shares of rh -- >> it looks good >> that shot is fine >> shares of hr, formerly known as restoration hardware, up 27 right now. the company posting first quarter numbers that beat forecasts. it is also raising its outlook for the year the company is also down playing the impact of higher tariffs on chinese imports saying it has renegotiated product costs, raised prices and is shifting some production aware from china. >> and we are keeping an eye on crowdstrike. the cybersecurity company is hirer today. shares closing up 70% yesterday from the ipo price crowdstrike worth pointing out that alphabet took a stake in this it invested 1$100 million in ths security software company. that stake is worth about 1$1.2

billion. bb & t bank and sun trust are expected to complete their merger this year now we know the name of the rebranded bank once that merger is complete. it will be called trust bank the ceo of sun trust said that they considered every possible combination of the two bank names, trust bank -- it's truest bank i thought it was trust bank. >> they did truest >> i thought that was a typo >> how would we know >> truest. okay they made that up. >> i guess -- >> that will mess us up it's not really a word, i don't think. >> truest, that would be

t-r-u-e-s-t. >> you remember when exxon was looking for a name, it didn't mean fart in japanese, it had two xs and didn't -- what was vega >> nova, which means no go in spanish. >> you have to be careful. coming up, delivery wars target unveiling its same-day shipping plans and the first sentence handed down in the college admission scandal. we'll tell you why a former stanford coach avoided jail time can you imagine being a coach of stanford and ending up in the slammer? i guess you can. here's a look at yesterday's s&p 500 winners and losers

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good morning u.s. equity futures at this hour are in the green up 75 points or so on the dow. the s&p indicated up just under 10 nasdaq strong, up almost 33 points treasury yields in that 2.10 area i heard 2.12 today target is making the latest move in the delivery wars. they will expand delivery options with chip, a delivery

platform it acquired two years ago. shoppers can pay a flat fee of 9.99 and have the option of choosing from 63,000 items on target.com target's move into the same-day shipping follows similar moves from walmart and amazon. and new york city is preparing to toughen regulations on ride hailing services the city plans to renew the cap on new for-hire vehicle licenses and curb the amount of time that app-based drivers can travel without a passenger in manhattan below 96th street. there are currently 90,000 app-bas app-bas app-based vehicles compared to 13,000 taxis officials want to reduce cruising times for pick up from 41% to 31% >> 41% of what >> 41% of the time they're

cruising >> oh. you can only be cruising 31% of the time >> so the app would have to kick the drivers off the streets? >> is this really about traffic or -- >> i think it's both >> the taxi guys are still powerful >> they've been weakened by these ridesharing services it does raise questions about how much more difficult it's going to get for uber and lyft to get into profitability if you have more city restrictions and regulations coming up. places like london, if these are your most profitable areas and this is where you see the biggest pushback, it raises the hurdles you have before reaching profitability. we have a follow-up to the college admissions scandal in the first sentencing in the case, the former stanford university sailing coach avoided prison time after admitting he took bribes to help children of wealthy parents gain admission john vandermoer was sentenced to

six months of home confinement rejecting prosecutors requests for a 13-month prison term he was also fined $10,000. the judge noted that the sentence was warranted because vandermoer did not pocket any of the bribes. when we come back, more on the developing situation in the golf of oman crude prices this morning reflecting the rise in tensions in that critical region. two suspected attacks of tankers there. crude prices are up 2.8% and later, as we await the ftc's fine on facebook, we will talk about what potential social media regulations could look like and whether big tech needs to be broken up. ay tuned, you're watching "squawk box" on cnbc as someone in witness protection,

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welcome back to "squawk box. news breaking overnight. the u.s. navicy iy cis assistino oil tankers that were attacked near oman. >> nbc news in tokyo talking to one of the ship's owners saying the captain said they had been shelled or something to that effect and also the norwegian owner of the other ship saying the

captain of this ship just after the attack was heard on the radio saying something to the effect of it came from a surface attack both ships reporting that an outside force hit them there are reports these ships were carrying oil. that's not true. one was carrying methanol, the other napa, a blending ingredient whatever happened to these ships, it's hard to know what was on them if you were going to attack two of what are many vessels in the gulf of oman. where is that? you come out of the persian gulf, you go through the straits of hormuz, which iran takes control of, at least in their eyes, you come out into the gulf of oman. there's a good map that's where the two ships were. this would make it six ships on may 12th there were four different ships. two saudi-flagged, one uae and

one norwegian. with these two, that makes it six ships that were attacked outside the straits of hormuz in a month. we don't know who is doing this. there's no reports on whether or not this is iran or something having to do with the yemeni/saudi strife. if it's an outside force the fifth fleet is investigating. oil prices have spiked on the news >> thank you very much as you can see oil prices at 52.53. for more on what's driving oil prices let's bring in canary ceo dan eberhart you have been involved very much in oil drilling in the united states you're an oil services company you have equipment on about 10% of the wells drilled in the united states this year. >> that's about right. >> let's talk about what we see from the supply and the demand side in terms of where oil prices

have been, before this incident today oil prices were down 4% on concerns about supply in the united states. what do you see? >> i think there's a lot of pressure with the general trade war and economic growth and where that's going that's been weighing on things surging u.s. production has been putting downward pressures on prices people are worried about the inventory build happening recently >> the first thing you mentioned was the demand picture you think that's a bigger part of the deal now? >> it is i think it's potentially oversold or a little bit too much downward pressure on the price on oil if the economy slows, we're talking about a slowing of growth, not a contraction. i think the oil consumption will be higher. >> what have you seen in terms of how much demand there is to put on new oil wells this year with crude oil prices just above

$50. >> there's a lot of demand the story is about oil going up and down but also about the u.s. and u.s. shale, the permian continuing to take from opec there's an x and y axis going on opec production is down 2.6 million barrels from last year this time, that's been taken up by u.s. production i think you will continue to see as these pipelines come on in the permian in the second half of 2019, transportation costs in the permian fall, everything else being equal, the u.s. will continue to take market share from opec. >> what do you think when you hear about these tankers being attacked in the gulf of oman >> it has to be stressful for those who operate there. the strait of hormuz has about 18 million barrels of oil

flowing through it so it's a choke point and it could de-stabilize the world 20 years ago, supply disruptions in oil and gas were much more prominent. we had a sea of calm until these attacks, these four ships were attacked in the uae last month maybe the global supply needs to not be taken for granted as much, we need more slack in the system >> all of saudi arabia's oil has come through the straits of hormuz >> yes and many other gulf producers. >> with tensions like this, what does that do to your industry when you're talking about permian basin? >> sure. i think it shows the permian basin is a much more stable market, it's onshore it's less complex and less room for supply disruptions it has a foreign policy component. as we produce more and more oil here in the u.s., in the

permian, there's more room for -- more room for u.s. security envelope to be different from what's needed in the rest of the world. i think that gives the u.s. more of an ability to push and be assertive with iran or assertive with people in the gulf for foreign policy reasons we won't have an oil supply strife like we had in the '70s >> we watch it from afar, we hear chevron talking about it, buying up more space in the permian. exxon noble being interested in the same and also anadarko. how does that play out on the ground >> we saw this in the bakken five to eight years ago t becomes a bigger players game. the service companies need more scale. there's less mom and pop operators. there's a race to scale. and you're seeing the internationals and majors come

home why be in mozambique when you can be in the permian and it's much safer the world is a risky place, unsafe why nothe permian basin. >> where are we in that evolution if this is following that arc of the bakkens eight years ago? >> i think will you see more consolidation. players like pioneer, exxon, concho, those could merge or be bought the chevron fight over anadarko may be the first inning of further consolidation. >> we see the monthly jobs numbers. it's full employment, it's difficult at times to find employees. what are you hearing >> it's extremely hard to find people, to find good people. we're blessed with the good team we have, but it's very difficult to recruit people.

the safety and compliance regulations continue to get tougher. it is a challenge to hire people it's a testament to the good economy, but also something that worries us as we move forward. how do we hire and retain great people >> what's your best guess about where oil prices are headed when you have the concerns about the economy and also looking at tighter supply >> first, i would watch what happens with the opec meeting that's about to come up. opec plus russia put a floor on the oil price. that's what they anticipated to extend the cut if they don't extend the cut, all bets are off and the floor goes away. i think they will surprise with a bigger cut but i think it goes back to what i said a couple minutes ago, this is a long, slow retreat it's about oil going up and down if you're a u.s. investor or investing in the u.s. oil field, it's also about making market share so at the same oil price

you'll do better in the permian basin, you have that capacity doubling in the second half of 2019, first quarter of 2020, that will lower transportation costs that's been an 8 to 12 range for a lot of companies that will fall to the $3 to $5 range. even at the same oil price the permian will get more competitive. >> thank you for your time today. >> thank you for having me on. >> in guy says truest is the worsest. >> i saw that. >> when these names come out, you don't like them. i don't. >> i thought it was trust. that made sense fto me. that's a good name for a bank, trust bank >> i remember verizon. >> a bridge. they got so mad. >> verrazano >> yeah. >> they used to get mad. coming up, a 70% pop on the

latest money usilosing unicorn. and here's a quick check of what's going on in the european markets. green across the board not big gains.

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the ipo rush returns to wall street crowdstrike soaring on its debut and now investors are getting ready for chewy.com. leslie picker has more it's that window before the fourth of july holiday where deals continued to flow and investor interests continue to

grow crowdstrike price ed 13% above h top end of its range to surge 71% above on the first day trading yesterday. crowdstrike offered its ipo at $21 per share, above the range it was marketing to investors. on deck is chewy the online pet retailer boosted its offering size by 12% yesterday on greater than expected demand. tonight it is expected to set a final price that could value the company upwards of $8 billion pet smart which acquired the company two years ago will raise about 700 million, 100 million will be raised by chewy itself pet smart will retain control. the week after that we expect the direct listing of slack and

also the real-real as the parade of ipos march on >> am i wrong to remember pets.com i think a lot of people are looking to that and drawing analogies here >> what's the difference this time around? >> it's 2019 >> profits >> they are losing upwards of $200 million a year. they have never been profitable at least according to financials they have disclosed. they do have decent top line growth which is really what vaetsers are kind of -- that's drawing them in. it's amazing. pet smart acquired this company two years ago for $3.5 billion. not even top line growth can explain that differential. >> i recommend they not use a sock puppet. joining us now is business

editor. you look familiar. was that yesterday >> it feels like that. >> was it the day before it was this week. >> when was it, dan? >> two days ago. >> time flies when you are having fun. >> and retwahett wallace of trin research. why would anything change if the next ones according to rhett have the same type of positives going for them this is going to get hot. we are going to be talking about how hot the ipo market is if this continues. i think what we are learning is lyft and uber were the exceptions to the rule. when they struggled in the after market, the feeling was maybe wall street said we care about profits. they don't like ride hail very

much. >> what's next >> uber is more of an outliar. uber i think wasn't an ipo. it was so widely held that there was no onward catalyst for them to buy more. this stock is stuck at 42. everything is working except uber and so crowd strike not a surprise if you can be anyone in the world you wouldn't want to be another z scaler. so it just shows that there is a huge amount of demand even in names that are lower quality. >> what about chewy.com? >> on one hand they are not profitable. on the other hand the sock puppet. >> we look at --

>> their close enough to the line that its not insulting to your imagination the way it is for something like lyft where you see lyft losing something like 50 million in revenue. >> i like that line. it's not insulting to your imagination. >> some of the guys were like having a laugh at investors' expense. i think the unit economics of what chewy is spending to get new customers to buy stuff and the stickiness of the demands. plus they are big in their category where they don't have anything like uber/lyft duhopoly. it hasn't happened yet. for the moment they are in the clear. i think there are a lot of reasons in this market which is why we saw the price get bumped. >> has alphabet got enough money from these investments >> alphabet has done very well.

even the uber deal, they made a fortune off of that. i think when google first invested in that it was a 2.5 billion valuation. google's venture capital group has made a lot of money for the company. it has provided places where they can make acquisitions. that's kind of how they got into nest. >> does that carry everything? is that everything >> i'm not certain if that's everything or not. that fluctuates. it probably included crowd strike and that thing has gone way up and will probably continue to. i think with crowd strike. z scale, it's been viewed as an acquisition target forever. i typed crowd strike in. my last ten conversations going back two years were have you heard rumors crowd strike is going to be acquired

i think investors are kind of expecting that. >> what's on your radar? what's the assignment that it has you thinking about it? >> i think it is notable you see the companies getting double digit games. following that one, it's a lot of these tech names. and i have to wonder, when do we start to see the companies that are lower quality that really do start to put a damper on some of the performances people are making money on companies going out. when they stop making money that's when you start to see things slowing down. >> i brought home some of that. >> the pet food that -- >> big hit. >> fresh made. >> chewy is different. >> different than beyond --

>> can we infuse it with some cbd? >> you get all the buzz words -- no pun intended. they need a special pet coin infused with cbd and alternative meat products. >> you expect low tech companies to be -- >> online retail. i think the slack indication will be interesting. there is some technology in that. if they do well, it will comp -- that's the next big indicator for how the big tech names are doing. let's see how many filings we get in before the august shut down. >> so it's an august shut down. >> people usually go away in august. we see filings that we weren't looking for that's an indicator that people feel the market is

good. >> peloton. >> hurry up and get it in before it turns bad. >> also that. >> good to see you. when we come back, the major indexes posting back-to-back losses. futures this morning are higher right now. ip digit gains almost for the dow. a visual snapshot of your investments. key portfolio events. all in one place. because when it's decision time... you need decision tech. only from fidelity.

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breaking news, oil prices jumping on reports of a tanker incident off the iranian coast. big tech under fire. washington talking about regulating facebook, google and others. what would that look like exactly? and what would it mean for investors? a fairytale win. >> the st. louis blues stunning the hockey world rising from last place in january to stanley cup champions today. the puck drops on the second hour of "squawk box" right now. ♪ we are the champions my friends ♪ >> live from the beating heart

of business, new york, this is "squawk box. good morning and welcome back to "squawk box". u.s. equity futures up triple digits. among the stories that we are following, headlines at this hour, oil prices are jumping after two oil tankers were the targets of a reported attack. the u.s. navy says it is aware of the incidents and is assisting the two ships. the exact circumstances are unclear at this point but could ratchet up tensions between iran and the u.s. elsewhere, back here, wal-mart is revamping jet.com, it's unit. it will fold jet into wal-mart.com. wal-mart bought jet in 2016 for

3$3.3 bimillion. president trump setting a deadline. he called the relationship with beijing good but testy in his words but still plans to meet with chinese president xi jinping later this month assuming that that is possible. >> right now it is time for this morning's market movers and dominic chu joins us. >> we will kick off with the public ride hailing stocks. if you take a look at uber shares, they are off to a positive start pre-market up about a percent or so. analysts have started coverage of the stock with an outperform rating. they put a $60 target rating on it. they like the option ality.

we will move on to what is happening with shares of lyft also about a percent or so. that same team starts coverage of lyft with outperform and $74 price target. they see it growing sales at a faster than industry rate and as more of a play on north american ride sharing. we end on facebook up fractionally. it's getting some positive commentary from analysts at rbc capital saying facebook stands out as the definitive leader despite recent controversies according to the recent social media survey. analysts at deutsche bank say the facebook watch could be under appreciated by investors. speaking of facebook, we should point out from a general markets perspective since the lows we have seen this month in the month of june, we have seen a bit of a move higher in some

communications services stocks. it is still the worst performing sector. facebook may be lending some of that to a move higher. i point out that the three best performing sectors, materials, technology and consumer staples. some of those sectors, the big standouts so far in the month of june. we'll see how things play out today. >> t. woods, 5:09. >> phil lebeau would say, keep in mind that this is a three-hour difference. >> it puts it into primetime for some of us u.s. viewers. >> not too primetime. >> i have to go to bed at some point. these are early starts. >> there you go again taking us

right off course. >> i'm going to stop now because the producers will kill me again. >> you might stop, but do you see jordan speith is playing with tiger today. >> the group right in front of tiger and jordan. >> jimmy walker, ian -- >> brooks koepka is playing in front of them, too. >> those guys better walk quickly because it will be coming over their heads with koepka. >> i think he is a big hitter. >> i can make you so uncomfortable right now. >> i'm not uncomfortable. i know your producers are probably not happy. >> you let me handle them. joining us now -- santoli doesn't give a crap. >> i have time to give. >> we will cover what we need to

cover as a senior markets commentator. mike, i will start with you just because we rauch the markets on a daily basis which is totally futile, obviously. we had some nice gains last week that looked like we were back on track. what are we stalling out again here >> and just stalling perhaps. obviously, it doesn't seem to me -- let's put it this way. it seems like we are right on the cusp of deciding if that was just a bounce because the market got oversold and people got too negative and defensive. yesterday's story yields really have not gotten air under them in the past couple of days and i think it is a stalemate for the moment just because we kind of did correct some of the oversold conditions. >> what's the next thing we are watching for >> we know all the things we are watching. we know there is a fed meeting next week. i don't know if it is clear that those things will kind of

release us from this situation we are in. i still think you have a couple percent down on the s&p before you decide that was just a head fake bounce. >> we learned back in '08 and '09 that the stock market can giveth and the stock market detaketh away. it can be really scary. i see people making fun of trump saying it was the greatest week we have had in a while but we are back where we were in january of 2018. isn't consolidating the gain since that election -- better than being back down 20% or 30%. we went well above -- >> no doubt it is better than being down 20%. >> if you analyze it, we are 26,000. >> there is nothing wrong with that. we had another period like this leading into the election. we consolidated for a year and a half. and then you did -- exactly, you

released to the upside at that point. i think it has been side ways for 16 months. >> you want to listen to this. there is the sharper vergence as you know between where assets are and the growth outlook is. >> you will tell us which is right. >> depending on moving parts particularly on the political side i think the divergence is notable. everyone focus -- on the bearish camp we had interest rate volatility back at the high. commodity spiking to the q 4 level mostly on demand weakness concerns. i would say commodities and rates market paint a fairly cautious or bearish outlook on the world. then you look at equities and

credit. funny that we are sitting here fretting about s&p trading side ways when the yield curve is negative. i think that's the divergence we are talking about. equity volatility really coming back in, trading below average telling you there is not a lot to worry about which seems a little too optimistic. >> so are you leaning one way or another? >> depends on the political front particularly the tariffs, whether or not we get the tariffs removed -- >> or whether they don't go on. >> i think the expectation is a positive outcome. everyone remembers in december. i think that is being priced into the market. what is being priced into the equities market is the fed. the market is saying the fed is going to cut multiple times and we can continue to rally. growth will be fine. i'm not so confident.

i think the risk is still out there and i think the fact the volatility markets haven't reflected that is an opportunity. >> and it would be signaled by the ism. >> the main effect is on the manufacturing. >> if we go into the 40s. >> that's generally bad. >> you know, the 1995 so-called insurance rate cut a lot of people are pointing to as potentially a model for this, you basically had stocks trading at their highs. you had a steep tightening cycle. i think that's one of the issues and gets to the point. can you order everything on the menu stocks at a high, earnings are fine. economy re-accelerates and a fed rate cut. all of that seems like a lot to ask for at once. >> my take has always been that

the 95-96 area is when he earned his reputation of pulling strings perfectly during that cycle. powell has referred to greenspan cutting rates a few months after he tightened to say we went a little bit too far and let the economy -- last year he did a speech referring to that. >> not like a last week reference? >> no. in his mind, he was like don't be too dogmatic about the inflation side of things because you don't know that the dmae has produced -- >> he had a way of communicating with the markets to prepare the markets for what he would do with his briefcase. it was never a big surprise. he had a way of -- >> never a big surprise. february of '94 half a percent point. >> you weren't watching. we knew from the briefcase indicator you were not. >> i was at the --

>> he was seasoned in 1995. how many years ago is that >> me? >> no. greenspan was an elderly dude and now is still going on and as sharp as a tack and god bless him. we cherish allen greenspan. i guess we have to wait to see what happens. are you worried about the uncertainty? >> there is always uncertainty. >> uncertainty is always there. >> everyone is acknowledging and focussing on the uncertainty it is less dangerous. >> we talk quickly here. if koepka tees off first, he is not hitting into tiger. he is ahead of tiger so tiger doesn't have to worry about him hitting over his head. i had to think about it. no one caught it. >> you have been thinking it the -- >> u.s. open is not that big a

deal at pebble beach or anything. >> at your house when we come back, this morning's stocks to watch. let's take a look at the biggest premarket winners and losers in the dow. this morning, we are leading the way, exon mobile and chevron, the two top components of 1.2% and 1.1%. stay tuned.

welcome back to "squawk box" the futures have been indicating up. dow futures up by about 91 points. the nasdaq up by about 40 points. this comes after the second day of losses registered yesterday although they weren't massive losses yesterday. green arrows across the board. online pet business chewy is ready to go public. the company is raising its expected price range. chewy is set to price tonight and go public tomorrow. among today's stocks to watch today lululemon shares are trading higher. the company reported better than

expected first quarter results. among catalysts, strong growth from the online business of sale of legging and jogger pants. tyson is breaking into the so-called alternative protein market. the meat producer is introducing new plant-based nuggets and blended burgers. shares of the company are up on the news by about 1.3% and tag you're it. >> coming up, tesla shares down more than 36% so far this year. will investors take elon musk's upbeat comments as a buy. first as we head to break, check out oil prices. stay tuned. you are watching "squawk box" on cnbc.

welcome back everybody. tesla's ceo rallying shareholders saying the company is on track to hit its production goals. analysts remain divided. kathie wood is the ceo of arc invest and is very bullish on tesla. you have a $4,000 price target. why is it that this is your top holding in your fund >> well, it's the most misunderstood stock i believe

out there, much like amazon was in the day. there was a whack of mole moment or four-year period in amazon's life. today it looks obvious what was going to happen in retail. this is the big trading range. the demand wasn't there, don't have enough cash. every time they fix something that the market is worried about, the bears go on to something else. this is very reminiscent of amazon. >> the $4,000 price target is not a 12-month price target? >> it's a five-year time horizon. that is a big difference between the way we are looking at the world and the way most are. >> another analyst says this is a binary situation. you can go much higher from here or go to ten dollars i think is the price target. a lot will depend on whether they can make it through the

financing needs over the next year or two. >> we have assumed in our bear case which is $560 in five years, $10 billion. if we were talking about '08-'09 when the markets were shut down, that might be one thing. the markets are open. as they ramp production and as demand continues to surprise on the high side of expectations, first quarter was an anomaly because they were shipping to china and europe. now the chinese website went down because depamand was so strong. >> elon himself said this week that while they don't have a demand problem, the problem or hurdle is that no one can afford their cars. its price is the big issue because you no longer have incentives that used to be offered. >> our analysis excludes

subsidies and always has. the total cost of ownership today of model three is lower than a toyota camry if you give us this five-year time horizon. and i think more and more consumers are starting to do this arithmetic. i haven't gone to the gas station since i bought my model three in september of last year. that's a huge change in my behavior since i was 16 y. went once a week. so -- >> here is what at times i thought about signing up to get on a list to try to get a tesla. here is what held me back. the idea that there is not a dealership that i can take it to if it breaks. the idea that if anything happens down the road it is on me. he said they will have a 400-mile charge coming up very soon. but the idea of not being able to get something fixed when it breaks, where do you take your car? >> first of all, in terms of their service issues -- and this

is very typical -- >> they anticipate problems and do over the air software updates before you even see them. to me, that is a much better solution than spending a day trying to get my car in and out of a dealer to get its service. >> if it can be fixed. >> the other thing they are doing is they are setting up service vans so that they can come to your office or your home to fix the car. so it's a much-better model than we have right now. yeah, they have to perfect it. but i think they are absolutely doing the right thing. >> you have time with your five-year, 4,000 -- it's hard to pin you down on something like that when you can go out five years. if you discount it into eternity you can probably get to a million. in terms of -- last time around you had what sounded to me like

some crazy forecast about autonomous taxis that will be around like next month according to you. >> in two years. >> two years, fully autonomous taxis replace everything. >> it's going to take time. we need regulators. >> we are going to know two years whether this is true or not. >> if you were to drive in the model s as it's moving towards more and more autonomy, you would be really surprised, changing lanes, getting off highways, even off intersections now. tasha our analyst went to drive in one of these test or pilot models, and was shocked that there were construction sites. they were able to maneuver around them without an engineer taking the wheel. >> i think it's the job to assume regulators will allow this when you are reading

headlines today. >> so regulators are very data-driven. there are 35 to 40,000 lives lost every year here in the united states. 1.25 million worldwide. they are already saying that if you own a tesla, you are 40% less likely to get into an accident. that's the regulators saying. i think it was the national highway and transportation safety board. after the first fatality that was their analysis. and i want to go back to exponential growth if you look at the first quarter numbers and they were lower than expected because deliveries to china and europe were taking some time just to get there. the model three sold 50,000 units. the bolt sold 5,000.

a year ago the bolt sold 5,000. so that was flat year over year. the model s last year was at a higher base than the bolt, 8,600 and was up six fold to 50,000. they are doing something right. they are doing something right. people love these cars. >> i appreciate your coming on. we will have you back to talk more about it. bernie sanders says americans would be delighted to pay more in taxes. his argument and the counter to it is still to come. take a look at u.s. equity futures which are holding on to ipme premarket gains but not trle digits anymore. her's docto. we can do the screening at her house. hi. this is the man that's going to check your eyes grandma. cognizant ai solutions are helping healthcare companies advance diagnostics and prevent blindness in patients with diabetes. everything looks good. you have beautiful eyes.

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♪ ♪ go big or go home still to come on "squawk box" bernie sanders is doubling down defending what he calls democratic socialism. what would that mean for the u.s. economy we'll debate that next. big tech under fire. what washington could do to regulate corporate giants like facebook and google.

later this morning, we will get a key read on the jobs market at 8:30 eastern time. you are watching "squawk box" right here on cnbc. you should be mad at forced camaraderie. and you should be mad at tech that makes things worse. but you're not mad, because you have e*trade, who's tech makes life easier by automatically adding technical patterns on charts and helping you understand what they mean. don't get mad. get e*trade's simplified technical analysis.

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senator bernie sanders doubling down on the campaign trail defending what he calls in his words democratic socialism. >> today in the second decade of the 21st century, we must take up the unfinished business of the new deal and carry it to completion. and that is the difference between donald trump and me. he believes in corporate socialism for the rich and powerful. i believe in a democratic socialism that works for the working families of this country. >> joining us now to explain what a sanders' presidency would mean for the markets and the economy, stephanie celten, senior economic adviser for bernie sanders. she is also a professor at stonybrook university. and joel griffith, research fellow at the heritage

foundation. that's a catchy phrase, corporate socialism. i hade to use actual words and definitions because then it ruins the idea. socialism, there is capitalism and socialism. socialism is where the means of the production in an economy are owned or controlled by the government and capitalism is where means of production are owned in the private sector. i don't know what corporate socialism means. can we say bernie would like to raise taxes on the rich. >> what he means by democratic socialism as he described it yesterday is sort of a return to i think the core values of the democratic party. so he is harkining back to the era of fdr and the new deal. when he talks about corporate social oism, he is talking about the give aways, subsidies, transfer of welt of the people at the very bottom to the very top. >> should we continue to have the means of production owned by

the government or by the private sector or should it be switched over to government he did cut his teeth in the soviet union. he was very positive on their system of government. that collapsed. we know what happens when there are shortages. adam smith wrote this in 1776. it had been around a long time, the idea of the invisible hand. we do see certain socialist countries not really work very well like venezuela. you see the shortages. people have lost an average of 34 pounds. how is this different? you are going to do it right this time? >> he is not talking about socialism. he is not talking about venezuela-type socialism. he is talking about making the system that we have work for everyone and not just a handful of people at the very top. >> you think that increasing government and the role in the

private sector more government control would help the people that are on the lower end of things >> he is not talking about more government control. he is talking about greater freedom. if you listen to the speech yesterday he emphasized what it means to be free and the various ways in which people today under the system that we have aren't free. are you truly free >> if everyone is paid the same thing -- if a doctor is paid the same as the sewer cleaner, the sewer cleaner will leave. there are usually walls where people can't get out. let me just ask. what is democratic socialism other than a way of sort of stepping back from what we're really talking about so you don't you know have to answer the ducomparisons. >> i listened to the speech yesterday. i about doubled over when dwr heard him say there is no

freedom without economic freedom. i agree with him. i feel he stole his definition from 1984 where the party leader said slavery is freedom. let's just look at the energy component, the green new deal that the left is promoting. germany only implemented a portion with their renewable energy mandates. the electric costs in germany are triple that in the united states. california has embarked on their own version of this. you see gasoline prices in california $4 compared to 2.50 down south. that's an extra $1,000 per year per person with the tiny component of the green new deal. we know socialism results in fewer economic opportunities and higher unemployment. i'm not just referencing

venezuela. i'm talking about spain and italy that have dabbled in this and are still paying economic consequences. >> miller may not be a social commentator, but he at least knows about markets at least to some extent. here is what he said if bernie sanders were elected president would happen. >> bernie sanders became president, i think stock prices should be 30% to 40% lower than they are now. the good news is, we would all be much more equal because everybody would be poorer but the rich would have lost a lot more wealth than the poor would have. >> he makes another point. bernie talks a good game about solving inequality and about equal opportunity. this is what he said if he didn't want equality he wouldn't be like this.

>> when he says he is against charter schools, i know the man just doesn't care about ineco inequality. he cares about power. how in the world can you be against charter schools if you are serious about the inequality issue? >> i don't advise on education policy, no. >> but to fix the inequality in this -- and to hopefully give opportunity to everyone, let's say you do 50% of wealth tax, what do you do with the money? universal basic income or try to equalize opportunity here or redistribute >> no one is talking about anything remotely like -- >> what do you do if you do higher taxes on people that have wealth >> the point is he is talking about a range of programs,

talking about making public colleges and universities tuition free. he has a deep commitment to the importanceof education. he is talking about investing in infrastructure, child care, talking about a right to a job. he is talking about affordable housing. he is talking about a range of things that lift people up from the bottom, raising the minimum wage, dealing with pay inequities. i can go on and on. >> i'm trying to figure out the individual bills for each one of those things you just said with the entitlements we have right now we have to somehow address the way that -- 70% of the federal budget is already with what we have. can we afford that type of expansion and more entitlements? more free stuff. is there enough money to go around we need the new monetary theory where you just print i guess.

>> let's look at the cost of medicare for all proposal. $33 trillion over ten years and the question arises. can the wealthy pay for the bill if you were to implement the two percent wealth tax that senator warren proposed, it would raise only 300 billion of the $3 trillion annual bill. where does the money come from i would like to refer people to the bill that senator sanders submitted in 2017 and in the fine print there are some suggestions. one of the suggestions is an 11.5% payroll tax that would apply to almost every single worker. that still would only cover half of the bill. we need to see senator sanders and others be honest that if we have a european style state we will have to have a european style tax code and that means

the middle class will have to pay that burden. >> i think about the green new deal. he wants to do that, too. >> when we talk about medicare for all, it's important to remember that we pay more already than any other country on earth. we are talking about 18% of our economy wrapped up in health care. so transitioning from the system we have which is bloated, inefficient and the most expensive in the world to a more efficient, more cheaper form of health care delivery, we are actually going to save trillions of dollars. the question isn't how to come up with the money to pay for it, we are already paying more than anyone else in the world. the question is what will we do with the money we save we are talking about saving trillions 06 dollars. some of those freed up resources can go into something like the green new deal. >> you look at -- god bless our veterans, but you look at

government-run systems and that's not the first thing that most people would think of is that it becomes more efficient and that you save trillions of dollars. >> medicare for all, veterans health care. the most popular of the health care systems that we have in place today. >> joel, we got to run. we are going to pay for the green new deal with what we save on health care. >> we might want to look at the more than 200,000 veterans that one research showed died for waiting for health care for the v.a. if this is the model for the new health system, i worry for bad times ahead. >> we may actually see this play out, joel. stephanie, you will be there maybe advising sanders. you are not an official adviser at this point? >> not on the campaign. >> thank you. >> joel, thank you.

>> thank you. up next, big tech under fire. washington is talking about regulating facebook, google and others. what would that look like and what would it mean for investors. let's head to a break and take a look at the biggest premarket s&p 500 winners, tyson leading the way right now. nob we'll be right back. be good while i'm gone.

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i think we will have questions about content. 65% of americans get news from facebook and google, should they not operate under the rules that -- >> commenting on facebook. the question is whether it will have to pay for hosting inappropriate content. julia boorstin has more on this front. this story is really picking up steam. >> absolutely. interesting to hear senator warner weigh in on the issue last night. the comes down to the fact that the tech giants don't face fines here in the u.s. for failing to remove offensive or violent content. the act protects digital platforms. it says no provider or user of interactive computer service should be treated ads publisher or speaker of information provided by another information

content provider. republican senators josh hawley and ted cruz along with nancy pelosi have suggested repealing to hold tech giants accountable as foreign governments are increasingly doing. in april australia passed legislation threatening huge fines and jail for tech company executive said if they fail to remove abhorrent, violent material. in u.k. a new law threatening substantial fines if platforms don't quickly remove content that encourages terrorism or child exploitation or abuse. one area where the companies can definitely face pricey fines in the u.s. is lawsuits. representative devon nunez is suing twitter filing the suit last week in virginia court allowing users to spread false statements about him seeking $250 million in damages.

>> stick around. let's talk more about this. joining us right now is michael furdic. we talked with you a lot over time. i know that you are a huge privacy advocate. the things we have been talking to you for five or six years at this point are now coming home to roost. what do you think about what you are seeing >> what a great and gracious thing for you to say. i have been trying to call these companies for about a decade for violations of privacy about cavalier attitude. when i first started my activism in this area in about 2006, some of the cool kids from the law schools and policy community thought that i was on the wrong side of the issue. i think the world has come around to the point of view that companies like facebook are doing things with your privacy and data that are clearly improper. there are a few different issues in front of the regulators about

a few different categories. one is privacy. one is speech. i wrote a couple of books, one called "the reputation economy" the third topic is the anti-trust. those three are different topics but are very much in front of policy makers. i think it is high time that all of them get discussed. of course, it is dangerous for someone like me in silicon valley taking a risk talking about this stuff publicly as i do. r venture people do worry about facebook and google. it's hard for us to do it publicly because we have to deal with these companies every day directly or indirectly as entrepreneurs and founders. we have to supplicate during the day while we are worried about their behavior. >> explain that. i want to talk about your role.

you mentioned reputation.com. now you have a venture capitalist and are usual ll lly involved in first round funding. they have to engage with facebook how and why >> every company in silicon valley is going to have to engage with a facebook or dpoog dpoog -- google. they have enormous platform to customers. you have to be a customer of theirs to sell to consumers. you want to partner with them to get better deals. you want to partner with them to sell your company to them or to do a deal that allows you to get leverage. just about every company we invest in is in the orbit of one of the giant mother ships. so there is a sense that these are the great powers in these waters. you have to be very careful even while you are criticizing them. it's a taboo topic even among

brave men and women of silicon valley. >> how are the companies you have invested in doing given your very vocal and public criticism? >> i am prudent with my investments. but yes here is another interesting thing. i definitely want to invest in brave men and women who are willing to take the fight to man as needed. it's a complicated moving set of parts. companies as large as facebook and google and apple are in some kind of collaboration during the day and night. you have heard this from luminaries that they operate more like nation states. they are aware that i am vocal. the companies that i'm invested in often like the fact that i am voc vocal. it is who i am. it is part of what you are buying when you do a deal with

heroic. the opportunity when you are brave -- the commodity that is rarest we know this in the media or anywhere else in politic pol the commodity that is rarest is guts. this hot take culture that informs the speech that is so problematic that raises lawsuits like those from devon nunez against these platforms, that creates the problems and creates the blowback from mark warner or others who are considering a review to this 1996 law that governs the internet now which is so silly, this hot take culture is so familiar to us and problematic to all of us. we note that it began in some way in this 24-hour news cycle from the cable networks. >> michael, i have to ask here. we have seen this sea change in

terms of regulation, this awareness that privacy regulation is necessary. we have the law going into effect in california in 2020. we have a lot of talk about potential federal legislation coming out of capitol hill. my question is whether consumers really care. and it's been really interesting to see that we have f saw some usage numbers hesitate there in terms of growth, slow down and come to a halt in europe. and it did seem to be tied to european privacy laws. there are questions about whether american consumers really care about taking steps to protect their privacy. i wonder if that will change. >> i'm so glad you asked that question. the numbers are extremely inclusive and are not controversial. the numbers show when you give them privacy tools they use them especially younger users. if they have alternative tools that are pro-privacy, they will use them. consider what's app, consider

snap chat. facebook using its monopoly power copied and pasted snap chat's technology and benefitted from that usage, too. by the way, there is a privacy -- in 2011 the ftc entered a descent decree with facebook and can fine facebook now up to $40,000 per violation. if you multiply that by the 85 million people whose privacy was violated in the cambridge analyt cudispute and scandal that is trillions of dollars. i understand that the staff of the ftc asked for i believe tens of billions of dollars of fine. the discussion we are hearing publicly is more around $5 million in fine. i'm sure you observe this with

your viewers, when that number was chalked up the facebook stock barely faced a blip. i think we are not seeing numbers of what the government could do if they wanted to see how serious it was. >> thank you. michael, thank you. it's good to see you. >> thank you. >> john snow, i love you, michael. you're so smart. >> thank you. f you are handsome. >> i did think "game of thrones." >> coming up, senator chris van y en. whhe wants congress to take a closer look at chinese companies. stay tuned. my experience with usaa

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oil prices jumping after suspected attacks on two oil tankers in middle eastern waters. we will bring you the latest updates and the impact on crude. american stock exchanges. the new front. maryland senator will tell us why he wants more oversight at u.s. listed chinese companies. the run down from facebook's privacy problems to the surprise ratings of the spring sports

season. the final hour of "squawk box" begins right now. ♪ live from the most powerful city in the world, new york, this is "squawk box. good morning and welcome back to "squawk box". i understand the reds are not in last place for the first time since april 15. >> you just jinxed it. >> they are six games below .500 but beat cleveland. live from the nasdaq market site, i'm joe kernan. the futures have pulled back a little bit. 73 points of upside on the dow. s&p indicated up nine and nasdaq up 29. treasuries, they made a move a couple weeks ago and have been

hovering around 2.10. >> oil prices taking a leg up this morning after two oil tankers in the gulf of oman were apparently the target of an attack. the u.s. navy says it is aware of the incident and is assisting the ships. the exact circumstances are unclear but could ratchet up tensions between iran and the united states. there have been pictures of at least one of the tankers on fire. this happens just a month after four other tankers were attacked with the u.s. plaming iran for that. >> president trump, meanwhile, is teasing the latest possible resolution to the u.s./china trade fight. >> good morning. the g-20 is just two weeks away tlmpt are a lot of expectations built into the meeting. there are no expectations for a deal right now. president trump says he still is

reaffirming his expectation to meet with china's president xi jinping although he says relations have been better. >> i think it will end up making a deal with china. we have a very good relationship although it is a little bit testy right now as you would expect. i think they have to make a deal. >> despite saying he expects a deal, president trump when pressed said he will decide when the clock has run out on talks and when it is time for more tariffs. >> my original question was do you have a deadline for imposing the -- >> i have no deadline. my deadline is what's up here. we'll figure out the deadline. nobody can quite figure it out. >> meanwhile, lawmakers are pressing the administration to increase new scrutiny on chinese companies operating here as part of those ongoing negotiations. in a series of bipartisan bills, there are calls to make chinese firms traded here in the u.s. comply with u.s. and

internationally accepted accounting principles. a new bill put forward would do just that and ban companies who do not comply with these accounting principles for three years from being traded here. there are currently about 156 companies that ratraded in the u.s. that are chinese firms with a market cap more than $1 trillion as of february. we will see whether the administration incorporates that into negotiating principles. those senators have written to ambassador lighthouser to do just that. >> let's bring in our guest on this, democratic senator chris van holland of maryland calling for more oversight. senator, it's good to see you. thank you for your time. >> why don't you tell us why you think this is important. >> senator kennedy and i think this is important to protect the

integrity of u.s. exchanges and to protect u.s. investors. all we're asking is that every country including china play by the same rules with respect to u.s. standards and our disclosure requirements. every other country in the world has come into compliance or is about to come into compliance. and our legislation just says everybody needs to be in the same a pool when it comes to protecting american investors. so we have introduced legislation to that effect. we also wrote to ambassador lighthouser asking him to include this as part of the negotiations with china. >> senator, i understand why the administration is using tariffs with china. i understand why we feel we are at the unequal end of an unfair playing field when it comes to that. i get why there are concerns about security. i think huawei basically lied to get where it is today.

when i hear something like this, i can't help think tr is a little bit of -- why do you think chinese companies are so much worse than what we have seen here? >> because they are the only outliars here. they are the only country that is not playing by the rules. we have a system, an entity created after sarbanes oxley called the public company accounting oversight board. they look at accounting records of companies listed on the exchange to make sure that they are compliant. back in 2011, you had a number of chinese companies essentially go under. it turned out they were defrauding u.s. investors. this would have protected the u.s. investors. there is estimated $40 billion that were lost. this is just asking china to do what every other country is already doing. >> don't exchanges have authority to have oversight of

the companies? i was of the impression that if you can pass the exchanges' own strict changes -- >> this is the loop hole in the law right now, the reason we established this oversight board was to ensure the integrity of the exchanges. so it is not the case that china is currently complying with that review. every other country has come into compliance. the one that was still outstanding was belgium. they have negotiated an agreement. so i guess the question is why would we want to expose u.s. investors to the possibility of being defrauded by one country this is something that i think we have been pushing for for a while. we have given three or four years already to allow the countries to come into compliance. our legislation actually would give another three years for chinese companies and other

companies to come into compliance. i think that is a reasonable amount of time and we think it is important to protect the integrity of our exchanges so investors have confidence. >> what kind of support do you have in the senate right now >> we have very strong support in the senate. my view is if we had a vote on this today, it would pass overwhelmingly and maybe unanimously. >> have you heard back from the trade representative light houser >> we have not. we just wrote. we introduced legislation sometime ago. we did bring it to the attention of the administration. i think their view is chinese companies should come into compliance. we want to make sure that we elevate this so it is part of the conversations when ambassador a lighthouser and our negotiating team are meeting with the dchinese, whenever we conclude an agreement if we

conclude an agreement. >> i look at you now. you are so senatorial. you used to be on all the time. you were like fire breathing in the house. it's really like the house of lords and the house of commons. have you not -- i don't know, you seem very -- doesn't he? >> maybe i haven't had enough coffee this morning. >> now that i have buttered you up, i want you to answer this question. if this came down to sanders versus trump, do you hope bernie sanders would become president of the united states and try to institute democratic socialism here, senator? >> i would pick bernie sanders over donald trump any day of the week. and if you look at what bernie sanders is actually proposing, as he explained, it's a

continueuation of the tradition of franklin roosevelt. i'm not taking any position in the democratic primary for president at this time. but you asked me a specific question about bernie sanders. and if you look at what he outlined, put aside what you call it, what he outlined was an agenda which in many ways is an extension of what fdr talked about. we have social security. is that socialism when we all sort of share in the risk? >> i understand. capitalism, we say this again and again. maybe you want to tax the wealthy more and try to somehow equalize opportunity for people that are being left behind. socialism even if you are just drifting there where the government owns the means of production and therefore there is no competition. we know it doesn't work. we know it doesn't work.

we know it doesn't work. >> let me make something clear. i am a strong believer in a free market economy with very strong guard rails. we know that when you have a free market economy -- >> knowing you as i know you i thought you might say i need biden or something like that. i don't believe in your heart you want the democratic party to nominate one of those far left candidates. i don't believe you. >> i said i would pick bernie sanders over the current occupant of the white house. i also very much said that i'm not taking a position yet in the democratic primary. >> i got it. the line is about this thing you are trying to walk along which is fine. that's washington. >> let me make it a bright line. i would take bernie sanders over donald trump any day. i have not taken a position in

the democratic primary for president. >> we understand that. >> the whole pot looks good. >> guys, the problem is that people are not having a serious conversation. when you immediately claim socialism requires ownership of all protection. i know you are kidding. >> your speaker of the house wants to put him in jail. i want the president of the united states in jail. does that sound like a serious conversati conversation >> she said when he is not president anymore he is subject to the laws of the united states and if he violated the law and if a jury finds him guilty beyond a reasonable doubt that's where he would go. >> i really buttered you up. thank you. thanks for coming on. we'll see you again.

another potential chapter in facebook's privacy battles. e-mails may connect ceo mark zuckerburg with what can become problematic purposes. we'll talk about what the headline means when "squawk box" returns. it all started under this buttonwood tree. twenty-four people came together to sign an agreement that created the stock exchange. just the right elements coming together.

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time now to take a look at three big media stories. first, social media, facebook has uncovered e-mails that appear to show ceo mark zuckerburg's connection to problematic privacy issues. joining us now, tom rogers, executive chairman and ed lee, "new york times" corporate media reporter and cnbc contributor. i liked the video so much and then find out it's not really mark zuckerburg. >> that was not my people. >> it was pretty clever. >> i would have used, what was the actor's name izenburg >> i see him and i think he's not really. i like that zuckerburg better. what's the latest with this

privacy stuff? >> so there was a leak of you know the ftc looking at what they want to get out of facebook here. it is going to be more fines. it's going to be maybe even structural changes. i don't know. the story in the journal was didn't offer enough about what these e-mails may or may not have said. i think we are still a little bit left in the dark. if zuckerburg himself is partly to blame for this they want to name him in that suit, that dereally change the game. they are going to get some sort of settlement, this can be seen as leverage. >> you have been big here at nbc, cnbc, run other companies. which company if you are running any of these in the cross hairs, which would you be like maybe looking for an exit because you are afraid of what's to come which one is more vulnerable do you think? >> vulnerability on the anti-trust front in terms of breaking this up i think that

facebook probably is in the gre greatest -- >> people see an easier way to do it. i actually think the whole privacy issue is actually one where they would like this to be addressed. they would like government to step in and figure this out. >> i don't think just being good at what you do necessarily means you need to be broken up. the privacy issue is one that should be addressed. >> you know, all these companies are existing just fine under the european privacy structure. europe addressed this. they put it in place tlmpt is no reason that they couldn't live with the same environment here. >> they would like it if it were the same as the standards that they comply with.

what if it were different. senator warner suggesting they should be held to the same standards. that's a much bigger problem for them because for them to be responsible for anything going on your platform, that is a tall order. >> that goes to the issue of are they responsible for the content that goes through them. >> i think it is hand in hand. if you are responsible for privacy perhaps you are responsible for what is on your platform, too. >> that is a very tough standard to hold them to because they don't have control over what users put up there. to the extent users look to put up fake videos, they have a difficult time policing that and the line between what is deep fake and satire that is somehow reputationally harmful, who is going to police that is the government going to police that? for me, washington post chronicles president trump telling 10,000 lies over the

course of the administration. they call it out. they see lies, they call it out. i think what media is going to have to start doing is calling out the fakes, the top ten fakes of the day. they get a lot of distribution. people aren't sure what is real or not real, it is up to media organizations to have a profile to know what is real and not real because the ease with which they can put out fake stuff is only going to increase. >> colleagues and other papers have pointed out this is either a fake account or this is a -- facebook or twitter or youtube, they take them down after the media reports. >> it's the media's job to police >> for the ones we find, the ones we don't find are the ones they don't find. >> this is a highly produced segment so i'm unable to screw it up. >> where there is a will there is a way. >> squawkers and talkers. >> i think you might manage to screw it up. next, let's talk about hbo,

the cable channel dropping news ending a seven-year relationship. many expect vice to expand internationally. >> i think this says more about ultimate at&t which owns hbo. if they are going to spend money on news stuff they are probably thinking why don't we spend more on cnn and what it might -- >> i will screw it up right now. do you see a big difference between cnn and vice do you remember cnn when they did 24-hour news >> what would you call that now that you watched >> i am loyal to my cnbc -- >> you are punting. >> i thought the vice show on hbo was really good broadcast

journalism. it was intended to appeal to younger viewers. fox news has an average demographic of people ten years into medicare. >> like you -- >> uh oh. >> you can do the math. i'm not quite there. >> i'm right there with you. if i couldn't say it to you -- for the grace of god. >> they do a lot of foreign news, a lot of news that isn't really showing up on television here and attracting a young audience to television. most young people, majority are getting news from social media and digital sources. and the idea that you can put together a television broadcast that attracts younger viewers to serious news i thought was a pretty good thing in terms of development of what people are looking at when they get information. i think that show will find a

home on hulu or somewhere else and vice will be just fine as an ongoing source of broadcast journalism. i never did see the fit with hbo. that didn't make much sense that a franchise people go to for entertainment on demand. >> too right wing for you? >> maybe not left wing enough. >> i agree with tom. i think it was a really nice product. the editor of that did a really good -- there is a new guy in charge for that. it might take on a slightly different flavor, maybe a little more -- >> we didn't have time for the third. >> i didn't screw that up, did i? >> we were going to talk about hockey, how hockey beat the ponies. like saying what is going to win bruce springsteen free concert

in central park. >> congratulations to the blues. did you know there was a hockey game >> yeah. >> anyone -- >> last place in january and win the stanley cup. that's an incredible story. >> when we come back, more on this morning's stocks. plants capture co2. what if other kinds of plants captured it too?

if these industrial plants had technology that captured carbon like trees we could help lower emissions. carbon capture is important technology - and experts agree. that's why we're working on ways to improve it. so plants... can be a little more... like plants. ♪

coming up, markets waiting for the morning's breaking economic data. the latest reads on jobless claims and import and export prices. that is just minutes away. stay tuned. but is that enough? i need tech that understands my business. i need tech that works at scale. dear tech, dear tech, dear tech, we're using ibm blockchain to help make sure food stays fresh. we're exploring quantum to develop next generation energy. we're using ai to help create more accessible health care. we're using iot to create new kinds of digital wallets. let's see some more headlines about that. let's expect more from technology. let's put smart to work.

that's what happens in golf nothiand in life.ily. i'm very fortunate i can lean on people, and that for me is what teamwork is all about. you can't do everything yourself. you need someone to guide you and help you make those tough decisions, that's morgan stanley. they're industry leaders, but the most important thing is they want to do it the right way. i'm really excited to be part of the morgan stanley team. i'm justin rose. we are morgan stanley.

welcome back. >> rick santelli. >> absolutely. last week we had 218,000. it is now 222. 222,000 on initial claims which means by the revision it is up 3,000 continuing claims move from a slightly revised 1.69 to 1.69 1/2. may import prices down 0.3 following a -- petroleum down the same. now, if we look at year over

year import prices which many think is the best way to view the series it is down 1.5%. it was expected to be down 1.2. so that dropp really is substantial. let's look at export. following it up. and export prices year over year, they are down 0.7. and that is versus up 0.2 last month. the year over year numbers are a bit steeper drop than we anticipated. the aftermath in the market place. preopening equities. lots of eyes focussed on crude based on what is going on with the two tankers. and for the moment, i am particularly concentrating on how the last in supply goes at 1:00 eastern. becky, back to you.

>> stick around. let's add a couple more voices. chief economist at nationwide mutual and our very own senior economics reporter. >> you do this long enough and all of a sudden a data series that for like 15 years didn't matter now matters. can you remember when anybody cared about import prices? the reason we care is about of tariffs. we care specifically about import prices from china which i am about to deliver to you having dug through the numbers. we are down 1.4% year over year what we have seen here perhaps are two things, the effect of currency. in other words, the chinese currency is de-valued or

depreciated and perhaps producers taking a piece of the pain. there is 25% of pain, but we are seeing that a very small piece minus 1.4%. broadly, the u.s. economy seems able to take this because we are not getting a surge in import prices. you have petroleum prices going up and down. and on the jobless claims number, we are not seeing the weakness that we saw reflected in the claims number. >> that's the number i thought you were talking about. that number was very important because of friday's job. >> claims are always important. the only problem with claims is that it is a little asymmetric. they give you a very good signal on the upswing but not necessarily on the down swing because employers tend to be reluctant to fire. if things were slowing, you wouldn't see a big pop in claims

right away. in that instance, it's lagging. in the upswing, it might be a leading indicator. >> what do you think about the latest numbers and what it tells you about the economy. >> if we start with the claims numbers, we have seen low numbers now for months and months. certainly, claims are essentially all-time lows. employers are very hesitant to let workers go. that is the sign of a tight labor market. on the import prices, nobody paid much attention to them before. i think it is primarily the strong dollar. so the dollar being strong keeps import prices low. it makes the fed's decision a whole lot easier if there is not much inflation. >> what is that fed decision i think for next week, no change in policy. it is interesting to see where the dots fall. i think that the fed, we should take powell at his word.

they will be data dependent as long as the economy looks like it is not falling out of bed and it's not, then i don't think that the fed will feel compelled to ease. as long as inflation is not rising and it's not, it certainly isn't compelled to tighten. >> do the -- >> we have a lot of smart people on the panel. i have a question. if you were locked in the room where all you can see is data points and the price of various markets whether it is interest rates or stocks, would you have any idea that there was a trade infraction going on? >> probably not. >> i rest my case. so it is all political. that's all i want to know. thank you. >> rick is right in the sense that we don't see it necessarily in the cpi data in the consumer data. it's not necessarily in the producer data except for in one place. i think the trade wholesaler

data where that is a place where businesses in the u.s. side of the border seem to be reducing their profit margins. and it's not necessarily -- in some instances we have seen it. you have had this big down draft in soybean prices. i don't know it's another sort of weird data point that i follow pretty regularly now. rick asked an interesting question which is how if at all are the tariffs showing up in the data >> we are certainly seeing it in some manufacturing numbers. and when you listen to the folks at ism talk about that, they say that their members are talking about the impact of tariffs and particularly the impact on supply chains and how it is difficult, more difficult to bring things across the border. at nationwide, we have lots of farmers who are clients. clearly, what is happening with ag prices is a big issue.

clearly trade is having an impact on soybean farmers. >> i want to close with the best line i have heard this morning from a friend of mine who is a trader in chicago. markets go up every time the st. louisblues win the stanley cup >> first time for everything. >> every time. >> that could be the next nfl. >> indicator. >> steve, thank you. david, rick, appreciate it. back to a developing story that we are following. two oil tankers reportedly attacked. overnight the u.s. navy is assisting the ships and oil is taking a move on the news. it was closing in on a four mandal. probably ready to bounce. this is a good reason. >> this is definitely a good catalyst for this to happen. >> does it play out that

actually effects supply and demand or is it all sentiment? >> it is starting to come out now though is will regular ships be able to get insurance to transit through the area. that is the fallout of this. not necessarily these two ships themselves. there is clearly some mining or smart torpedoing going on here. the damage of the ships i have been seeing has the exact same look and signature of what happened a couple weeks ago. >> so if an insurer might be in a position to pay a claim, it probably won't ensure the person. >> that's great. when do you need it? >> they are saying there are mines all over the place in their head. they are saying we are not going to ensure you against going in this death trap. >> is it your forecast -- and what was in the analysis to call for $40 oil? is that what you were looking

for? >> the demand outlook for oil in particular has really deteriorated. i have been trying to have oil get them -- grab the mantle of most damaged asset class by the trade war. i think we have been able to sort of secure that because the main economies that are getting hit by the u.s./china trade war fallout are the asian ones and german economy which are energy centric demand growth economies. even this morning in the monthly opec report which is supposed to be the sort of top situation for us in oil instead of this, they ratcheted down their demand significantly, as well. that has been hurting oil. >> just the persistent barrels has been a firewall against geo political events. we are only at 53. it is a decent size jump off the lows since jerd when we were pushing on 50.

this is going to be worrisome. >> it doesn't benefit iran to mess up the transiting. they are going to alien ate whatever supporters they had out there in the european union, asian customers that had been trying to work with iran, trying to stick with the nuclear deal and keep them afloat here. >> let's get into the conspiracy theories. who does it benefit? >> to the extent you have forces out there that want to topple the iranian regime or actors, it gets this game on and gets the u.s. potentially to such a state ofire that we attack and it gets the saudis what they want which is an attack on iran and israelis, too. >> this is why we are so cautious because it is early on. a month ago when the four tankers were attacked, the eu

and saudi arabia both came to the conclusion that it was iran. iran has disputed that. iranian ships have picked up some of the crew from those ships that were attacked today. >> the iranian state tv is all over it. >> showing footage of the ship on fire. >> it doesn't make that much sense that they would have done it. this makes this such a tricky commodity at times because of counter veiling influences. >> we had the ceo of canary on today. that is an oil equipment company. f it really increases the value of the basin when you start seeing how difficult things can get and how quickly in a situation like that for oil coming from the middle east. >> no doubt. although they are a victim of their own success. oil would be $70, $80 a barrel.

you will see the number jump over the next couple of weeks because there is so much ships picking up oil. if we had sanctions on iran, this price would be much higher. it's really a firewall against geopolitical events. >> we are doing so well that the saudis continue to ratchet down production to try to prop up the price. >> great. thanks. coming up, the biggest issue facing markets today and our next guest says it's not america's trade tensions.

what is it then? and can the fed decide not to cut rates? are they going to do it? we will talk about the best way veorcaprare. at do advisors look fr in an etf? don't just track an index, help me meet a client's need. is the fund built to sell or built to last? etfs are only part of a portfolio. so make it easy to explain. give me a quality fund that helps me get clients closer to their goals. flexshares etfs are designed and managed around investor objectives. so you can advise with confidence. before investing, consider the fund's investment objectives, risks, charges and expenses. go to flexshares.com for a prospectus containing this information. read it carefully. welcome to seattle. where people are into coffee, tech, and retirement planning. the perfect retirement for me is doing the things that i want to do, not the things i have to do. unlike seattle, less than half of americans participate in their employer retirement plans. so what keeps people more engaged in their retirement? i want to have the ability to easily transact online, great selection of funds, great advice,

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hiv controlling, joint replacing, and depression relieving company. from the day you're born we never stop taking care of you. we have been watching the futures this morning. right now the dow is indicated to open upby about 75 points. nasdaq futures up by 23. s&p futures up by eight. we are getting closer to the

opening bell. under an hour until the opening bell. dominic chu joins us with a look at some of the morning's biggest stock moov movers are you covering callaway. >> i may end with it if you want. we will kick off with shares of disney which are up right now about a percent or so on 50,000 shares of volume. they are getting some help from analysts at morgan stanley. they reiterated the overweight rati rating. and with the accelerated profitability you get -- also, we have shares of twitter down over a percent on roughly 100,000 shares of premarket volume. the social media platform reiterated as a sell by analysts. they have also lowered price target to 25 bucks from 28. they cited among other things

the expectation for slowing sales growth in the second half of the year, higher expenses and tougher comps to achieve. we will finish off here with shares up almost three percent. outperform of analysts. the target price goes from 62 to 50 bucks. they think investors should be willing to play a higher multiple for shares given lower mortgage rates and continued demand. i will say to your callaway point the shares have been under pressure for a while. we'll see if a good outing by tiger or anyone else at the open gets those shares higher. >> really not allowed to talk about golf. how about lululemon? >> it was covered very extensively last night. >> you have been told you are not allowed to wear those. >> i'm not allowed to wear them

here on air because unlike you, i know you get to stand under your desk. >> i'm under a desk. >> they want me full suit. >> looks great. >> no one can see me and i'm fine and comfortable. our next guest says the biggest issue in the market is not getting attention. joining us now here in the flesh, richard burnstein. you were on the other day and someone said there was a rich -- and they weren't sure. i said was it richard? they said i don't know. this is why i try to help. >> so you coming in happy this morning? are you still worried about tariffs? >> joe, i don't think one should

be getting more optimistic. i'm not pessimistic but i think all of our funds are decreasing equity exposure. that has been true all year. i think the main thing is things that are not getting attention, profits. the profit picture right now is really slowing down. i don't think people understand how meaningful that is. since the first quarter reporting period started, defensive sectors have outperformed almost right from the day. health care has outperformed tech. think about the bad news with health care with lawsuits over opioids and bernie sanders. yet it has outperformed tech. that's exactly what should be going on if profits are starting to decel rate. it is happening and like nobody cares. it's pretty wild. >> you can't always take the message from the markets and put it in the bank that it's right about something. in the past, you have talked about the disconnect between the

economy and stock market a lot. what is the move in the defensive sector of the market >> it's telling you that profits are decel rating. let's put numbers on this. 2018 s&p profits on the gap basis were up 20, 25%. it is our forecast by year end '19 that is 0% to 5%. go from 20 to 25 to 0 to 5. that has implications. i think that's what you are starting to see. i really think that that is the biggest story out there and people are just ignoring it. things like tariffs don't help. so what you have is a head wind for corporate profits and then a very uncertain policy environment which is making ceos and cfos more hesitant. it is a little bit of icing on the cake i would say. >> like so many things can be

good and bad, right? >> that's absolutely right. i think if you think about how portfolios are positioned and merrill lynch did a study where they pointed out that active equity managers are very overweight lower quality cyclical companies, that doesn't work in a period of decel rating corporate profits. i don't think people are paying attention to it. i think it's the biggest issue out there. >> really. >> i wouldn't lie. >> what about political issues do you think he is a pretty good manager? >> never a down year. his view is if we did get one of the crazies he calls him that the market would be down 30% or

40%. >> i don't know how you can say it just based on somebody winning or losing an election. i don't know. remember people said that about trump that if trump was elected -- >> trump was running on kind of -- >> i think one has to be careful. >> let's say if you are getting close to the election, it looks like you don't think that if the democrats win that that would be a problem for the economy or the market >> it depends what the democratic platform is. >> we have an idea what it is going to be. they are all aligned with the deal, medicare for all. >> let's say that they do something wild like spend money on infrastructure. that would be very good for the economy. what if they actually do that and somebody in washington spends money for infrastructure, that would be very good for the economy. i would imagine sthat most important longer term. >> and not worrying about the debt or raising taxes to pay for the debt or expanding social programs >> look, the debt and deficit issue has been going on for 40

years. >> you don't worry about that at all? >> people tend to talk about debt and deficits as if there is a crisis. >> would you expand entitleme entitlements >> or would that be a problem if we did expand entitlements >> in general, the answer is i don't know because you don't know what the entitlement programs will be, how they will be funded. i don't know if i can make a statement that this is good or bad. i don't know how one can do it. we are two years away from the election. >> next time we will invite someone who can make determinations i guess. >> corporate profits is a good deal. >> thanks, richard. >> you, too. let's get down to the new york stock exchange. jim cramer joins us. the news from tyson that it is going to be moving into the beyond chicken sort of place.

it's been helping that stock out today. >> i read the release, raised and rooted brand. do they understand this? they put money in beyond meat. is the stock too high? yes. is beyond meat fabulous? indeed. is it in tyson's dna that's what i'm concernedabout we don't know how to do it but these guys do. we have learned from beyond meat. tyson has great distribution. beyond meat which the stock is too high is producing burgers people love. a possible burger is gmo. millennials will not go for gmo. i want to know more about tyson. issue release but don't give news about what you are doing with raised and rooted. could you become up with a more complicated name >> to your point about

millennials not liking gmo stuff, somebody pointed out veegens will never buy from a company that is a meat producer at the same time. >> yes. i think that's right. i think tyson uniquely is gm and beyond meat, maybe toyota. it's one of those things where they take the world by storm. it's ten bucks a burger in denver. there are shortages throughout the country with beyond meat. i think there will not be -- tyson might as well be in another industry. i know nestle reached out to me when i said i didn't think the burger was that good. they said they had a burger that is for america and i was eating the burger for europe. to me a burger is a burger is a burger like a tree is a tree is a tree. this world has become so difficult to navigate. tyson, i don't know. >> my thought was why not just throw out that you are creating

bit coin, too or do it in an autonomous vehicle. >> this is a block chain-related burger. >> i had this idea long ago and that is gmo chickens with eight wings. so many people love wings. you need one chicken for two wings. >> i was with sally smith the other day. she built buffalo wild wings. maybe it should be st. louis because they won the cup. we make it so everybody has many arms. >> do you have any work on arc investments and their price target on tesla? >> why do they stop at 4,000 if you are going to go there, don't you go to 8,000? >> who wants 4,000 when you can go to 8,000. >> i'm still trying to deal with the fact that elon musk --

>> bring back the one where it pants you. >> remember when he was such a fire brand >> we have to go. thank you, jim cramer. >> we will be back and then toss it to jim cramer. [leaf blower] you should be mad at leaf blowers. [beep] you should be mad your neighbor always wants to hang out.

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make sure you join us tomorrow. "squawk on the street" starts right now. ♪ congratulations to the st. louis blues. >> futures are up as the dow tries to void the first three-day losing streak in three months. oil is a big story as we watch reports of suspected attacks of two tankers on the gulf of oman. our road map begins with oil prices up, biggest one-day gain since january.