i heard that from brian sullivan "squawk box" begins right now.e live from new yorkf wheree business never sleeps. this is "squawk box."e1çó >> good morning, everybody welcome to "squawk box" onç cn. we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. let's look at the u.s. equity futures. they have been higher even after the gains we saw yesterday 68 points. the s&pe1qiutures are up close o 10 points. the nasdaq is up by 45 points. we sawe modest gains in tradin activity yesterday that comes after the last couple of weeks where we have notched gains for both of thoset(1 wee. uqás there are closed the nikkei ended down by e10.7%. hang seng up by 1%

q were relatively flat up slightly, up about 2.5 points in europe we saw the active trading taking place all of this ahead of the fed meeting starting today the cac is the biggest gainer of the three major averages it's up by q%. you see gains of a half percent across the board and then if you want to seee1 what's happening in the treasur market here in the united states -- o0.042% >> there's no way bad news is good morgan stanley is soeñearish yesterday was the mostx boring day i watched ine the markets seeing the bug here and there at thee1 gym or whatever. i would look up. i have to check.e 46 i have to check. up 46. is it dog days yet

>> it may be market breaking news. facebook officially unveiling its cryptocurrency currency plans. julia boorstin has more on that. >> facebook announcing its new digital currency called libra. it will make it easy to send money around the world the currency is set to launch the first half of next year. it will be run by a non-profit in switzerland up like bitcoin, libra, this digital currency will be backed by real money. if you put in a dollar or some other currency into libra, you'll get a dollar or the equivalent out the goal is for that reserve of

real money to make the whole currency more stable unlike bitcoin, which is very volatile. now, facebook is partnering with 27 other organizations, companies, non-profits to start libra as an open source currency the companies range from mastercard and visa which could help mer chchants accept the currency to uber and lyft. by the currency's launch facebook says it hopes to have over 100 different developers on board. facebook has a plan to profit from libra it says that it is going to be creating a new digital wallet called calibra this will be run by a subsidiary of facebook. and it will be an app that will be a stand-alone app as well as operate within whatsapp and messenger. calibra will allow anyone to store money for free and allow people to send and receive libra instantly around the world with no fees.

facebook plans to add other financial services such as loans which it could profit from down the line former pay pal president david marcus, who is running calibra for facebook says the digital wallet will be secure and also separate from the rest of facebook so the financial data gathered will not be combined facebook's larger goal is to get people to spend more time on its family of apps and make it easy to make purchases from the 90 million business that open rate on its platforms facebook says it is working with regulators and it expects the calibra app to be approved you can find more about this announcement on cnbc.com we will have an interview with david marcus coming up at 7:15 a.m. back to you. >> julia, thank you for that we have so many questions for david. i think the first one i have, it goes to this issue -- i know

they're trying to separate it and put it as a separate non-profit, but in an age where people have -- i think it's fair to say a sense of distrust around facebook, how will they trust facebook with their money? even though i know they're trying to separate it from facebook, it is still facebook, right? >> look, libra is not going to be run by facebook libra will be run by this non-profit they'll have 100 different companies that are behind it david marcus has stressed to me they want to make sure the libra association is totally separate from facebook. you are right. there is a broader question of whether people are going to trust this app, calibra. we'll see whether the convenience. the ease of use, the fact it will be so easy to access it on top of messenger and on top of whatsapp, if that will overcome trepidation people will have because of facebook's history. marcus did stress they'll have the same level of oversight, the same sort of dual factor

authentication to make sure you're secure like a credit card they're also promising you if someone hacks into your account and steals your calibra dollars that they'll pay you back for that >> it sounds like a debit card i'll give you my money, you'll give me the equivalent back. it doesn't sound a lot like bitcoin. >> exactly they really want it to be different from bitcoin bitcoin is so volatile it's not based on any currency this is designed to be based on a basket of currencies there will be small fluctuations, but not massive ones those small fluctuations may be based more on fluctuations we see between the pound and the dollar or the euro and the dollar so it's that kind of smaller day-to-day fluctuations.

david marcus said they want it to be more like a real currency than a cryptocurrency. >> it's boring it's not a real currency >> two other quick questions at a time when some of the big silicon valley companies including facebook are under threat or under the gun from washington, when it comes it antitrust issues, is there any interesting back story in terms of how they were able to put this deal together it's not just took obviously they had to end up, you know, effectively collaborating with what looks like several dozen ov other companies. >> right now facebook is one of 28 companies on board for this launch they will have 100 by the time it goes to market by the first half of next year. it goes back to when facebook hired david marcus david marcus had been president of paypal. he came to facebook and he ran their messaging business as soon as he was running the messaging business for facebook people started speculating what does this guy who has a

background in payments going to do when it comes to digital payments for facebook. so there's so much opportunity when people are sending photos, sending video, sending messages back and forth could you just send money as easily as you're sending those other things i think this has been an interest of david's from the beginning. we can talk more with him in the next hour. i think facebook sees opportunity here to profit from the way people are spending money online the way a lot of the asian social networks are. it's not unusual for a company to get people to transact through their social network, which is something we have not really seen here in the u.s. >> they're transacting with yuan or transacting with dollars or real live currency, they're not transacting with a cryptocurrency so i imagine that the rational for cryptocurrency would be to make it as both frictionless and feeless as possible. >> exactly

frictionless, feeless and much easier toe spend money across country lines. someone asked me if this was like venmo venmo is for paying people domestically but also if you link venmo to a credit card you will be paying fees it's not easy for venmo to send money between countries as they want to make it easy to do with this >> it's not a cryptocurrency this is not -- this doesn't excite me at all is it based on blockchain? at least cryptocurrencies, they say there's no inherent value, but they're creating inherent value from the blockchain that allows you to -- all those previous transactions. they have an inherent value. this is just based on the dollar is it called a cryptocurrency? >> it's a digital currency apparently any digital currency

is called a cryptocurrency it's not just pegged to the dollar, but whatever currencies are invested into the libra basket of currencies libra reserve as they call it. it does seem a lot more like a traditional currency because of that reserve than it does like what we think of a cryptocurrency which is bitcoin, which is so volatile >> it seems like it's based on the dollar or a basket of currencies which made me laugh because the criticism that crypto is based on something that has no inherent value this is based on a paper currency, though it does have value, because it has the full faith and credit of the u.s. government you could almost argue that a real bitcoin has more value generated through blockchain than just -- what european currency do you want the euro draghi, as easy as he is they're all debasing their currency >> that's why they will peg it to these commodities >> there is an open source bitcoin technology that will be

underlying this. so they're going to enable anyone to build a wallet like the calibra wallet to access this they're going to have places that pop up in emerging markets that have people come with cash and turn that cash into libra. but facebook says it does not expect its calibra wallet to be the only wallet. there will be many wallets around the world and you can choose any one to access libra, but calibra will be one of many wallets. >> are republicans money worth less or do conservatives do they get a discount at facebook is there any type of -- >> 70 cents for you. >> joe, i think all dollars will be worth the same in libra >> they'll find a way of continuing their bias against anyone on the right. >> julia -- >> same exchange rate. >> i hate to throw one more question at you. i know we're figuring out this

stuff. you made it clear that calibra and libra will be separated from facebook, even though they're resting on top of it they want to keep it separate. they don't want people to worry about privacy concerns if it's a free app, we're giving you something for free we're not charging you fees. we'll make money some other way. will my information ever will be sold or will i be marketed to based on how much money i have in an account or if i look like an extremely well think person because i'm putting a ton of money into it. will that be used to market to me >> what david marcus told me is the calibra app will be a wholly owned subsidiary of facebook there will be no crossover facebook does plan to offer financial services down the line things like loans. they could offer bill paying, all sorts of different things

that you would pay a fee for or percentage of a bill for a payment and the like so they are looking at different way ways to profit from this calibra app. it won't be via advertising. >> we will continue to ask and hopefully get these questions answered when we talk to mr. marcus in the 7:00 hour. thank you for bringing us that news >> now i'm excited about bitcoin. it's $9,000 today. >> you could have bought a bit of mastercard, visa or paypal. >> i like all those more this i'm bored >> you guys switched positions again. now i'm a bitcoin -- at least they're doing this elegant stuff to create something. this is just -- you put dollars in and -- >> switching sides on the arguments. i can't -- >> i don't know. >> is there a taco bell nearby >> it's taco day >> it's free taco day.

the 80 cents is not the issue. >> it's whether you want to eat it >> exactly >> little early. >> breakfast burrito >> free taco doesn't appeal to you until there's one sitting in front of you >> i want one. but i will not make a special visit for 80 cents >> so you're openly throwing it out there, if anyone wants to bring you one. >> i hold off on tacos in general. >> but if they're here -- >> if they're here you know who else is coming today? the hershey ceo. did you see hershey stock? hershey at 138 she's done a great job >> lots of food to talk about today. when we come back, we'll talk about european bonds and currency on the move we'll show you what mario draghi said that has the euro sinking we'll get you ready for the two-day fed meeting that kicked off today and a programming note, tomorrow on "squawk box,"

i'll be covering the women's leadership summit in minneapolis. a big lineup coming from there including the ceo of kpmg's, target's ceo andcondoleezza rice all of that coming up tomorrow on "squawk box."

the euro turning negative against the dollar following a speech by mario draghi who said the ecb will need to provide more stimulus through rate cuts or bond purchases if inflation doesn't pick up. i'm telling you, i was reading at the top of the show, i said the euro is down on an inflation warning from draghi. that makes no sense unless the inflation warning is it's too low. >> it's an anti-inflation warning. >> inflation is too low, that's the warning. the german ten-year bund yeel h yield hitting a record low markets are fully pricing in an ecb rate cut by december

>> that is what we were talking about yesterday. >> i did not see that. >> were you watching >> i was not watching. i was sleeping until 7:00. you were at u.s. open. >> how great was that? kyle's hat got signed. i'm sure you didn't see it there was a segment they showed -- >> i did see it. >> was that not unbelievable with gracie? the little girl's name >> giving away a ball. >> she got up and down out of a bunker did you see that unbelievable sunk the putt. she kept saying i got this gary woodland, how psyched was he it's the most watched golf video of all time. 22 million views of gary woodland with this little down

syndrome girl who gets a par so bored with this beautiful little girl. we'll talk more about it i teared up watching it. >> everybody did he won with nerves of -- did you see 17 >> yeah. >> today's other big story, the fed. policymakers kicking off a two-day meeting later today. the rate decision comes tomorrow at 2:00 p.m. eastern time followed by jerome powell's news conference at 2:30 some are predicting we might see a rate cut this time around. that's not what most people see, but we have had people come in and said maybe we get a rate cut tomorrow let's get to the broader markets and what to expect joining us is joe zidel and david bunson gentlemen, welcome to both of you. >> thank you >> we were having a conversation earlier this morning or yesterday about whether bad news is really good news.

you had some questions about that and some doubts about that. >> i do. i think the markets will have a hard time charging higher here we are in this goldilocks scenario where the markets are expecting three to four cuts by the fed, number one. and they're expecting this favorable trade resolution i think those are two risks out there that are not adequately priced in. it seems like the fed will have a hard time living up to expectations of the market before the prospects of tariffs against mexico came up, the market was pricing in one cut for 2019 the tariff threat against mexico emerges, all of a sudden the market goes to three cuts. now that threat is off the table for now. the markets are still saying we want three or four kits. i don't see that much urgency. that's one area where the markets could be disappointed. and on trade, not only is mexico still this opaque thing where we don't know what goals are, we

have to worry about the second order effects against china. china is now retaliating in ways that the united states had never envisioned i think that raises some risk there. when china put companies on a watch list a couple weeks ago, then they advised tourists against travel in the united states china is the number one spender for tourism dollars in the u.s i think chinese tourists spend about $36 billion a year number two is canadians. it's a big spend, that puts a lot of hotels, restaurants at risk >> we heard that from some hotel owners >> i don't think those things are priced into the market the markets are saying this will work out we'll be fine. we're trading at about 17 times or 18 times earnings we don't have the earnings growth if we don't have the earnings growth, what is driving the markets higher the expectation that these thing

also m things will magically work out >> you can get multiple expansion if you get the fed funds rate lower a lot of that is priced in we've gotten one turn since powell's announcement last week that's been priced in. i agree with joe the problem is it depends on the timeline we're talking about can you get a tradable rally if the fed throws more stimulus on the party. perhaps. that's possible. but an intermediate term, it's mystifying what people believe will be the end here at some point in time do they not think we'll have to normalize and take away the punch bowl i don't think that's priced in at all as you look out 12, 18, 24 months. >> when you hear what mario draghi is saying today, maybe that punch bowl getting taken away is a longer trip. >> i think they're following our

dprent precedent and we're going to be following theirs there's no exception to this once you go to extraordinary monetary measures to stimulate the economy, which may be what they needed to do post-financial crisis, when they begin steps towards normalization in '14, '15, and '16, when they chickened out during that spook in january with the markets, the fact of the matter is at some point this has to be normalized. they didn't quite get there. >> if the economy is slowing, what would you tell the fed to do right now >> i can answer that but the problem is that when they do cut late cycle versus mid cycle, it doesn't have a stimulative effect so they push on a string i think that's what draghi faces in europe. so unfortunately sometimes what they may need to do is nothing at all >> joe, what would you tell people to do with stocks >> over the next six months

we'll see volatility and risks to the down side i would be a buyer in any of that volatility. i don't think this is the end of the cycle. it's not the end of the bull market or the end of the economic expansion this looks like the end of a late cycle pause the two things that will drive a recession in the u.s. are when businesses overinvest, where they become too confident and deploy too much capital. that's not happening and secondly when you get wealth destruction, a drop in home values or a significant bear market in equities that causes recessions neither one of those is on the horizon. any volatility or setbacks in the market, it's a viable opportunity. just that up 17% year to date when earnings growth is flat or at risk of turning negative, that's a clear warning sign. >> we do have an election coming up bernie is up by 9 supposedly you don't think that might cause a problem in the equity markets and the economy in general >> perhaps in the mid part of

next year and beyond but -- >> that's not far off. >> i don't see really an effect there. >> bernie sanders being the president of the united states will be terrible for markets he will not drive the market lower because bernie sanders will not be president of the united states. >> that's what george clooney told me about trump. >> am i clooney in that analogy? >> you are >> she tweeted gary woodland after the third round, tweeted you got this, gary >> i didn't know that either >> he saw that coming up, big news from the paris air show we'll bring you the headlines on boeing, ge aviation, that's right after the break. my old friend ♪ hello ,

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homeowners and renters insurance. in corporate news, boeing has booked its first new airplane order finally at the paris air show after it announced zero bookings on day one. it was korean air and air lease corporation that announced plans to add 30 737 new dream liners and 20 787 models. look at where shares of boeing are. 357. remember it was 365 or 370 is where that moving average was.

we didn't know if it would break below that, it did but has come back ge aviation is on track to book a record amount of orders. the company announced 24 billion in engine sales and services on day one of the paris air show including a $20 billion order from indigo airlines out of india. u.s. aviation regulators are planning to ease noise restrictions paving the way for new tests of supersonic commercial planes in american skies. that plane was unveiled at the paris air show the goal is to eliminate regulatory hurdles that have stopped companies from testing new supersonic designs the faa wants to permit for the noise still. much more on other story of the morning, the launch of facebook's cryptocurrency, we have all the details and we'll bring you a live interview with the head of the

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welcome back you're watching "squawk box" live from the nasdaq market site in times square. good morning, everybody. welcome back to "squawk box. we've been watching the u.s. equity futures they have been higher this morning. right now the dow futures indicated up by 90 points. s&p futures up close to 12 the nasdaq up by 55.

a developing story in the middle east the u.s. said it is sending an additional 1,000 troops to the region in response to hostile behavior by iran that move comes after iran said it would exceed limits on its enriched uranium stockpiles before the end of the month. it's also days after the u.s. accused tehran of orchestrating a second set of attacks on oil tankers near a global shipping route. new calls this morning from saudi arabia for opec countries to cut oil output in the second half of the year saudi arabia's energy minister reportedly telling other nations that the risk of slowing global demand for crude far outways th threats outweighs the threats of war and supply worries saudi arabia reduced its supply output by 150,000 barrels. crude is down 0.64%. it's a little weird they're saying that, you know, they

basically came out and blamed iran as well they're saying the threat of disruption and war is much lower than just supply problems. they always run prices higher. you can't count on iran doing it again, i guess coming up, the ceo of aston martin will join us. we'll get his thoughts on global demand in the luxury market. later, the carlyle group's david rubenstein is our guest host for the 7:00 hour we'll get his read on the state of the economy he's like interviewing a tv host kind of wed.ir >> that's just part of it. >> you're watching "squawk box" on cnbc.

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global growth fears have plagued invests the past few months the luxeky mury markets can some give us clues to a slowdown. joining us is andy palmer of aston martin you're trying to take this company into the future. along the way a couple of bumps on the road. the ipo, you decided that was something worth doing. and you think it's been misunderstood in terms of the stock selloff. stock is down how much 40% since the ipo in october of last year? >> yeah. people looked at it, i guess people have different appetites for isk.

we very much sold the company on the basis of explosive growth. we see that growth coming on board particularly with our first suv, which we unveil at the end of this year the shorts have taken a look and said in the short-term we can make some money here we are -- management is concentrated on the plan that it's committed to the market, what it would bring to market. >> the first report as a public company was disappointing. was that different than the projections during the ipo was there something globally that was less favorable? >> there was really -- first of all, it was the ipo costs, which were, let's say a little bit misunderstood. then we had an issue with one of our suppliers, a lighting supplier that caused a huge grouping of last quarter's production

those have washed through. we're looking good from that point of view. our first quarter result was a 39% increase in retail year-on-year >> those are really -- it's a niche car for someone that really wants an aston martin, wants luxury, wants to pay for that luxury. how many total vehicles in the united states last year? >> this year we will be north of 2,000 units. so globally we're about 7,000, 7,100, 7,200 it's very much the sort of six carmakers in what we call the luxury grouping of which we're one. it's all about exclusivity and rarity >> was it your initiative to do the suv? there's also another suv that is more luxury that is coming, right? >> yes, it was the suv was something i commissioned it was a fundamental part of me joining the company. it's an absolutely important trend that we have to capture,

particularly if you talk about places like the u.s. and china, where perhaps people look to sports cars to be a more suv shape. yes, we have a second suv coming, which is under the name of lagonda that will be the first luxury brand to be 100% battery electric vehicles. >> that's pretty amazing, too. and in terms of brexit, you built factories eventually in the uk >> yes, we have. we're building a factory -- just about to commission it in wales. and it will be our large car factory. in spite of brexit, yes. >> how will brexit affect you? and then we have 30 seconds, you also talk about your electric initiatives. >> that's a lot in 30 seconds. >> i know. i guess if we have 30 seconds, i would say one of the key initiatives of the company is moving into our mid he engine range of cars, cars which will compete at the high level. >> can we show that?

>> look at the picture >> can we do it? absolutely >> the thing here, up until today, it's been called amrb 003. as of this interview, we're christening it so this is the aston martin valhalla >> good name >> a place of beauty >> the previous one was the valkeri ishg valkerie >> all nordic names. that would take -- >> the most expensive? >> yes >> what is the price tag >> if you take the track version, 4 million pounds. >> how many did you sell of those? >> 25. 150 of the 001s, which is around 2.5 million. the valhalla is basically around 1 million. it's a snip really

>> a quarter of the -- >> you see an aston martin, you say -- when you see one, you say wow, what is that? there's no doubt >> that the the reaction we look for. we seek to be the maker of the most beautiful cars in the world. what is your day car what do you drive by day >> i drive a dbs i love it. it's 715 horsepower. >> you drive that to work? >> yes into work or to the supermarket. >> what if you need to put stuff in the back. >> you don't need another car. if you have an aston, you never need another car >> highlander, might not quite -- >> if you have kids? >> they can get in the back. it's two plus two. you need to cut the legs off, but it works >> that's horrible we got through the interview not one mention of james bond

until now. thank you. >> thank you very much we'll get you ready for a fed meeting which kicks off today. we have results from the latest cnbc fed survey and some surprising numbers on recession expectations you don't want to miss that. as we head to break, look at shares of beyond meat. shares have been soaring this week, up 11% right now stock at $189.20 "squawk" returns in a moment we're carvana, the company who invented

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welcome back to "squawk box" the fed kicking off the two-day meeting today and that means the cnbc fed survey is in and steve liesman is also in he has the results to share with us. >> thank you, andrew we have to report that the chance of recession as gauged by the panelists in the survey rising to the highest level in eight years. we're now 30% chance of recession. and that's up from 25%, just a few months ago and the bottom for the trump

administration was 13% this series which goes back to i believe 2011 has never correctly predicted recession. but that's not what you want to know what you want to know is has it correctly predicted a change in fed policy almost every time it came -- it spiked before qe2. it spiked before the fed stopped hikes after the initial beginning in december of 2015. so it is either coincident with or ahead of a change in fed policy that is the expectation. if you go to the next screen there's a dramatic change in expectations 78% say the fed will cut rates that was 11% in our april/may survey 22% say they - >> april/may of this year? >> yeah, just a month ago. >> a month ago -- this is the most dramatic outlook for fed policy i can remember and they're reluctant. you will see that in some of the comments i'm going to show you in a second. they hate this

and when will the fed cut? let's look at that they're looking 14% say june 29% say july 29% say september. and then 23% after september why is the fed cutting 35% say the weakness of the economy, 20% say market pressure this is everybody said well we asked people to take 100 points and distribute it across the reasons. 5% attributed it to pressure from the president here are the reasons that the inflation will be seen as transitory 52% say enduring here's some of the comments, we have marked down the forecast because the uncertainty surrounding trade negotiations even if there are no tariffs imposed on mexico there's an uncertainty that the other shoe can drop the fed should stay patient but may not in the face of market pressure we have a whole bunch like that. saying the fed should not cut,

but it will cut. these guys were uncharacteristically - >> yeah. >> these folks were behind the market the market moved and this panel came after that in terms of forecasting the rate cuts. usually it's the other way around. >> thank you, steve. for more on what we can expect, chris campbell from the trump administration, now chief strategist and neil irwin is here economics reporter, correspondent i should say and author of the new book "how to win in a winner's take all world. thank you for both for being here the big question, do you think they'll move today >> i think there's a real chance of it. i think all of the things they care about have moved in the wrong direction. if they thought they were calibrating policy in may, inflation, expectations the growth measures, it's all ticked downward in ways that, you know, i think what the market is capturing is something very real not just the market overreacting. >> do you think they will move

and should move? >> i think they -- they'll either move or a strong signal that it's imminent and i think that makes a ton of sense. >> i think they won't move this meeting but perhaps next meeting. >> what's worse, making it look like trump is right is bad enough but making it look like they're wrong in december is even worse they don't want to admit maybe that was a policy error and that's exactly what this would be doing if they did - >> i think you're right. but that's the worst possible reason is because you're embarrassed. it can't be about ego. they are human, will powell decide we can admit we made a mistake that's what grown-ups do. >> but they don't want to admit their mistake. >> how much can be a judgment -- >> can we go back, why is that a mistake? >> because you said -- >> owe, what happened in the quarter after they hiked rates, what was the number? admit the number

admit the number it was 3.1%. >> that's a backward looking - >> no no it was a forward looking number. >> why do think we were looking at cutting >> did the fed -- did the fed correctly predict that president trump would put tariffs on china? did it correctly predict there would be mexican tariffs that's not a mistake. >> the fed's job - >> there were no mexican tariffs and you haven't seen anything in the inflation numbers. >> the comments -- >> steve, you have been on the side it was not a mistake and a lot of people think it was a mistake. >> some people do, some people don't. >> do you believe it's the fed's job to be able to predict whether a tariff war -- >> that's not what's causing this we can debate that. >> do you remember you said it was the tariff and then the market paused and went up the 20% and it was not the tariffs. >> to our guests. >> working with jay and the fed and the folks at the fed when i

was at treasury, they're not going to want to be seen as -- they should not seen as bowing to political pressure. and tariffs -- we're a part of the economy, but also part of the pressure obviously as president trump leveraged on some foreign policies. >> great point. >> do you believe that the tariffs have played a role in this >> absolutely. one thing we have learned about tariffs with the commodity price drop since the chinese tariffs were escalated, even inflation impacts of tariffs aren't maybe what we thought of a few months ago. that you know we don't know how it nets out. and i think that's one more reason that the tariffs imply, you know, maybe easier -- easing monetary policy is where we need to be to do. >> what do you attribute the malaise? >> i think there was a garden variety slowing that was turned into something more than the garden variety slowing by the uncertainty. >> do we know for sure

>> i think we do pretty much we have had a good step down in the growth numbers from it went 2.2, 3.2 with final sales being 1.3. now we're looking at a 2.0 right now. >> down in the low 2s -- >> i think on this, the idea that they overtightened the last year, the four rate increases is more than the economy could handle. >> the book is called "how to win. thanks, guys. when we come back the guest host for the next hour is david rubenstein he'll give us his thoughts on the economy and where private equity might stand stick around as someone in witness protection,

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the fed and your portfolio, what you need to watch ahead of today's fomc meeting and where you should be putting money to to work. the launch of libra, facebook officially getting into the crypto game. the head of the new digital wallet will join us to explain. it's been quite a ride for hershey's ceo michelle backes as the second hour of "squawk box" begins right now ♪ live from the beating part of business, new york, this is "squawk box. >> good morning and welcome back to "squawk box" here on cnbc

i'm joe kernen along with becky quick and andrew roz sorkin. and you're a media giant and where -- where is that >> on bloomberg. >> oh, that was a bad question u.s. equity futures -- that's okay the mayor has a tv channel, so weird. >> it's doing pretty well. >> so weird. yeah all right, good. anyway, you're going to be asking questions and answering questions. >> i hope so. >> okay. i'm ready. we'll answer as -- i'll answer as honestly as i can without divulging too much information. >> all right all right. so you're happy with this show you don't want to go to another network? >> with the zinger every time. this is why you're so good at what you do. >> i love it here. you know what they say, you're over -- under, i don't know, well paid but undercompensated >> you're adequately compensated? >> that's -- what's making headlines at this hour

>> this is good. >> that's why people watch your show. >> here is what is making headlines at this hour, federal reserve policymakers begin a two-day meeting today with an interest rate decision tomorrow afternoon. that's followed by jay powell's news conference and some are expecting a rate cut and others see the fed merely setting the stage for a possible future cut. we'll have much more on the fed in a moment. but in other news, ecb bank president draghi said more stimulus would be coming if they did not approve. he made the comments in part gal prompts a slide in the euro. that's down about 20% against the dollar 0.2% against the dollar. that immediately prompted criticism from president trump in a tweet, the president said that draghi's comments and the impact on the euro made it unfairly easier to compete against the u.s. they have been getting away with this for years along with china

and others additional pressure on the federal reserve as they sit down for the meeting today. we'll get a fresh read on the housing market in 90 minutes economists think that new housing construction fell 0.4% last month as we mentioned, we have a very special guest host with us this morning investors are bracing for this week's fed meeting, will they decide to cut rates or remain patient? joining us to talk about this and much more is david rubenstein david, great to have you here. >> my pleasure to be here. >> you are an expert on the markets on reading the markets and trying to figure out where they're headed next because it's so important for private equity to always know what the potential exit strategy is going to be. where would you say markets stand right now and with all of this talk from the central banks around the globe, there's more money slashing around. what does that mean? >> many people in the market are worried about whether the growth period we have for ten years can continue as long as people would like it to continue which is surely for a couple more years

we have had a very long growth cycle, record growth cycle many people are worried about the trade wars we're -- that are going on in china. and maybe mexico and canada. we haven't resolved that agreement yet either i think the markets would like to see the trade agreement with china resolved at some point the u.s. mca ratified by congress at some point and to see some cut in interest rates at some point. i think also the market very much wants to see the debt limit increased. and the budget deal arrived at before the end of the fiscal year, september. the economy will be in pretty good shape, but if some of those do not happen, i think the economy next year could be more troubled >> let's talk about the fed itself because i think that's the most important factor that the markets have been watching for so long. would you agree with that? >> yes the fed is more important than ever because the fiscal ability of the congress to do things is very limited used to be you had monetary and fiscal policy. there isn't much more you do in terms of cutting taxes and

increasing spending because of debt limits. it goes to the monetary policy and that's been frozen for a few years because we're not certain if the fed wants to cut interest rates. i believe at some point you'll get a cut this year. i'd be surprised if it's today if the market today were to learn that the interest races were going to be cut i think that would be a gigantic shock for the market. >> i mean, with interest rates so low, where do you think equity prices stand right now? >> they're pretty high and that's one of the problems we have in the equity world we have to pay 13, 14 times cash flow to buy companies as opposed to 7, 8 or 9 times clearly, returns have come down a bit because of that. i think the biggest thing that people are worried about right now is whether the government of the united states can actually solve some of the problems for example, the trade war with china. that has been on hold for a while in terms of resolution i do think that the president will meet with xi jinping at the g20 summit and i think there

will be a resolution before the end of the year. there are many different issues to be resolved the biggest one is our trying to get the chinese to restructure their economy and restructure the way they operate i think that is the more difficult issue. i think the chinese will agree to buy more american products and i think that's the easiest thing to resolve other issue about the market access that's more challenging i think the chinese will agree, have more market access. they're more resistant in letting us tell them how to restructure their economy. >> so either based on your open businesses that you currently or other ones that you want to own, as a function of that assessment >> well, guy to china a fair bit. i talk to the government officials there and i obviously talk to government officials here my view is that both sides want a deal now, the pandas they want to reproduce, but they don't know how to do it, because they fumble from time to time i think the american government now really wants a deal. i think the president doesn't want to give his hand away too

much but i think the american government wants a deal. >> i think they're so cute they feel uncomfortable like engaging in such a dirty -- you know, the pandas i think they -- just are uncomfortable in trying -- they do grope around. >> they only have a four hour period of one day a year to be able to do this. >> that's different how from the rest of us i'm kidding. can i ask you recently, the rhetoric, totally has gotten ramped up to inspire really a populist approach to the united states in china. you have seen the rhetoric, haven't you? that doesn't look like a country that's ready to make a deal, does it? >> well, rhetoric is one thing and then getting a deal is another thing. the rhetoric in our country is often not as good -- >> why would you fire up the population if you're -- if you weren't looking for a protracted - >> because if you get people excited and come one a deal, look, this big problem that existed i just solved it this is not something uncommon to the united states either.

we say there's a big problem, then when you solve it you get credit for it. that both sidesrecognize there's a need for the deal. i think the chinese economy is slipping more than people would like to admit and the u.s. economy while it's in good shape i don't think it can go forever without a trade deal without china and without u.s. mca being ratified. >> no chance that the chinese to meet or president xi refuses to meet with president trump? >> i would be surprised if there's not a meeting of some type whether it produces a resolution i would be surprised before the end of the year, before the campaign season officially starts, next year, i think there will be a deal. >> how much more room then does the market have to run both in the public and the private markets if we get a deal because we're going to move into a campaign election year which may throw everything into question all over again. >> if we were to run the table, get all of the things i talked about a budget deal, a debt limit deal, a china deal, a u . u.s./canada/mexico deal, i think

the interest rates will go down a veried by then the economy will be strong for another year or two remember, presidents get re-elected when the economy is good the presidents don't get re-elected when the economy is in recession ford, carter, herbert walker bush if the economy is pretty good he has a pretty good chance of being re-elected >> i know you said as a private equity guy you don't like it when prices are high, but at the same time, what the do you think of the ipo market? because again, you need the exit strategy too. >> ipo's are less significant for people like our firm we tend to sell things to other private equity firms ipo market is important but not as it once was so it's not as important as it used to be as a way to exit. >> i can't believe how bullish you are on getting a deal.

you talk in your book it means -- >> he talks to both sides though. >> i means a lot to carlyle. >> well, as an american -- >> i am too. but i thought things have gotten worse in the last -- hold on, relax. >> remember it looked at a time when there wouldn't be a deal with canada and mexico. >> seems totally different we're in a cold war all of a sudden with china about so many different things, about we weren't -- we weren't worried that mexico would take over the world by 2025. >> both sides need and want a deal i think the rhetoric has to be discounted somewhat. i do think a deal will get done by the end of the year now, the chinese were not able to deliver on what they initially negotiated and the negotiations occurred and in the end when it went back to - >> is that what happened, they couldn't pass the laws that we needed pass? >> the chinese when they negotiate something, the administration said they reneged on it. but the china couldn't sell what had been negotiated so hayed that to take some of it off the table. it won't be as presence as --

>> president trump says here's a lesser deal and we're okay with that then? >> i think president trump's ability to sell a deal is pretty good if he wants to do so. i don't think everybody knows the details of what was being discussed but if a deal gets done, even if it's not 100% of what we once wanted it's still a deal. >> all of the issues talking about running the table are going to happen? >> i think if all of them happen, it will be great. >> no, i appreciate that but if you're on handicapping whether they all - >> by the end of the year there's a pretty good chance i don't think the debt limit will not get passed or the failure to come up with a government deal. i don't think we'll have a government shutdown again. the democrats may not want to give president trump a victory the china trade deal doesn't have to be approved by congress. >> right david is with us for the rest of the hour and obviously we'll dig deeper into the issues coming up, facebook officially throwing its hat into the crypto ring.

the ceo of facebook's digital wallet calibra will join us to discuss. the futures -- i think rubenstein has some clout. up 119 people would love a deal i was ready to write it off. but now i'm back on board. stay tuned bck x"n atching "squawbo o cn "squawk box" is sponsored by franklin templeton reits for better

welcome back to "squawk box. corporate news to bring you. boeing has booked the first new airplane order at the paris air show green air and air lease corporation announcing plans to add 30 new 737 dreamliners as well as 27 87 models there's no maxes in those. important shares of boeing up marginally they had not announced any orders yesterday meanwhile, airbus had announced huge number of orders so that raised a lot of questions. meantime, ge aviation on track to book a number of orders that includes a $20 billion order with indigo airlines out of india when we return, facebook's big bet on crypto and a digital wallet we're going to find out how the company plans to keep it safe and secure david marcus, the head of the

facebook new digital wallet called calibra will join us. it's bn eea sweet ride for hershey. we'll hear from the ceo on the state of the company "squawk box" will be right back.

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box. some big news today facebook revealing the cryptocurrency plans earlier this morning and julia boorstin has the details. julia? >> that's right, andrew. facebook announcing it's leading the charge to create a new cryptocurrency called libra. it makes it easy to send money around the world as a photo. it's run by a nonprofit out of switzerland and libra will be backed by real money to minimize volatility facebook is partnering with 27 others to start libra as an open source currency including mastercard, visa, uber and lyft and nonprofits with a plan to have over a hundred developers on board by the launch in the first half of next year. facebook though does have a plan to profit from libra it is creating a new subsidiary called calibra that's going to be a digital wallet that will operate both on

top of the messenger and whatsapp applications as well as its own separate stand alone app. calibra aims to enable anyone to securely money for free and to allow send and receive it instantly around the world with no fees though facebook plans to add other financial services like loans it can profit from. facebook says it is keeping this digital wallet totally separate from its advertising business and the rest of facebook's different divisions so add targeting and -- and ad targeting and financial information won't be commingled. >> stick around. i want to bring in the man behind all of this, david marcus is joining us, head of facebook's calibra he is joining us from the heart of silicon valley and welcome, david. thank you for joining us on the day that you're announcing so many of the details about this help us understand the difference between this cash effectively, debit card, if you

will, and bitcoin or what might be described as traditional cryptocurrency. >> well, i think that, you know, if you want to compare libra with traditional cryptocurrencies the first thing and the big difference is typically that cryptocurrencies are investment vehicles or, you know, investment assets rather than being great medium of exchange and this is really designed from the ground up to be a great medium of exchange a very high quality form of digital money you can use for everyday payments and cross border payments, microtransactions and all different kind of things i think that there are a lot of issues that need to be sold. if you were to get out of the studio right now and ask anyone to send $10 on their mobile phones to canada, they probably wouldn't know where to start and this is 30 years after the web was invented and mobile broadband is available to so many people. so you know we felt that it was

time to try something new. and this is the beginning of a long journey to launching this new network and this new digital currency. >> to put a fine point on it, how much do you think is going to be people transferring currency internationally versus domestically meaning for those people who have credit cards or access to venmo or other services like that, why would this be advantageous if i was -- if becky was a friend of mine, i think she is a friend of mine hopefully on facebook, and i wanted to send her some dough. >> well, i think, you know, we are privileged we live in a country that has a very stable currency very trusted institutions. easy ways to pay each other on mobile devices but that's actually not the case for many, many people around the world. and definitely, you know, to your earlier point, cross border payments are still very hard,

very expensive cost an average of 7% to send, you know, across one border. sometimes it takes three, four days to clear. and it is a very cumbersome and expensive process for many, many people around the world. so i think if you think about it from a use case, cross border payments is definitely going to be a primary use case. but i think that, you know, when you think about the effect that having an internet of value exists or protocol for money on top of the existing internet and all of the things that can be built on top of a low cost system like this, you know, microtransactions are things we have been talking about for decades and it hasn't materialized because the amount you're trying to transact is actually lower than the transaction fees so when all of these things change and you can move value around the internet and in a real easy way, i think profound changes might happen.

>> david, we want to bring julia back in the conversation in one moment but i have a quick question, maybe it's not a quick one in a moment when there is so much distrust around facebook or at least questions about trust and currency and money is -- the ultimate basis is about trust, how do you square that circle? >> well, i think that, you know, i have a slightly contrarian view on this which is i don't think there's ever been a better moment for us to do this because of the way we're doing it. you know, as julia was mentioning earlier, we're actually going to launch this new blockchain at some point next year. we have launched the test net today that people can start experimenting with but, you know, this new blockchain is actually going to be decentralized and run by the members of an association and we're just going to be one among many to govern over the new network and currency so i think, you know, when you look at how much effort we have

put to limit our influence and limit our control over this network, i think, you know, it's a new way of operating - >> so you don't ultimately have control over it? >> we don't have control over the network, we don't have control over the currency. what we have control over is the wallet that operates in facebook. >> but others will be able to create their own wallets or are you the de facto wallet -- >> no no, we're not the de facto wallet there will be plenty of competition and to earn people's trust we are going to have to make strong commitments notably on privacy ensuring that financial and social data never get commingled and really earn people's trust over long periods of time because there are going to be a number of wallets that are going to compete with us on the network we helped create. >> julia >> yes, thanks, andrew thank you for joining ounce

this, david. david, i think one really big question here is what facebook's incentive is on this if you're not going to be running the libra currency there's got to be some end goal to profit from the calibra app you have certainly invested a significant amount of resources in this project over a number of years. if you're going to be allowing people to send money around the world for free, how and where are you going to be making move on from the libra app. walk us through it down the line. >> i think it's important to say if such a network already existed today, a blockchain is serving billions of people, a digital native currency that is stable and of very high quality, then we would not have to worry about creating that and my life would be a lot simpler i could just focus with -- you know, my team on building a great wallet experience. sadly, it just doesn't exist and we felt that we had to try to

accelerate the time line of creating the new technologies to bring those solutions to market. so, you know, in our end, first all of, this is very close to our mission. we have connected billions of people around the world. we enabled them to send you know photos, you know, all kinds of different content. texts, et cetera all over the world but we're not enabling value so 2.7 billion people use our product on any given month on the other side of it we have 90 million small businesses on the platform if everyone can actually transact with one universal unit of value, then we believe that over time it can create a lot of opportunity for more commerce on the platform, more transactions. and those small businesses will, you know, end up potentially buying more ads because those ads will be more effective for everyone involved. >> hey, david -- >> i understand if you get -- go ahead. >> sorry i understand, david, if you get

people to spend more time on facebook that offers more important to get more advertising dollars, but what are the services that could be profitable for calibra are you offering loans or bill payments where can we see new revenue streams for facebook and at what point will those kick in >> so not for quite some time, because right now what we're going to be focused on -- first of all, the network isn't even live with a main net that's available to everyone. this is just a test net. with a lot of documents that we have put out there to share governance and how this network will hopefully come to life, at some point next year when the network comes live, what we'll focus all our energy on is bringing this new currency and the new experiences to the mainstream and focussing on adoption but, you know, in a number of years out, if this network is successful, if a lot of people are actually using this service, we will start building more

services, you know, in financial services because, you know, i feel that lowering access -- lowering the barriers of access to capital and lowering the cost of capital and the new network on which intrinsic costs are completely different could be a very large opportunity over time but again we're not going to focus on that for a number of years. at first we're just going to focus on enabling this new network to exist across facebook and try to empower as many people as possible to access this new high quality digital currency and transact with one another. >> hey, david, i understand you're operating this separately from facebook but i think from a privacy perspective people are still going to be concerned. this a free service. you won't charge fees for that, but i assume you'll make money somehow. should i assume you will be taking whatever private information i'm putting on there about my money, about my transactions, any any of those things and eventually using that

to market to me? >> never and, you know, that's the whole point of - >> not internally either >> -- a specific entity. that's the point facebook inc. won't have access - >> facebook won't, but will you have -- will you use that information to ever market to me in any way, shape or form? new products >> that's not the objective here at all again, i think that to your point, if people don't want to trust us, you know, they can use any of the other wallets that will be available and there will be dozens and dozens of wallets available for people to choose from. >> but just to clarify, you said it's not the objective does that mean that will never happen it's not the objective or it's not the objective or it will never happen >> no, that's the point. it is not the point to use dat on calibra the wall let to market to you. that's not the point at all and that's not the way we'll monetize again the principal way this will accrue to facebook in the

short term is basically -- not in the short term but after the network launch is adopted by lots of people which will take time is removing friction for transactions between the 90 million small businesses that we have on the platform and the 2.7 billion people who use our products every month. >> hey, david -- >> that alone will drive more revenues on advertising which is, you know, more than enough in our core business for the first years and the foreseeable future. >> final question. when you react to this, this is phil chen, from htc. he thinks you, by the way, might have a success on your hands, but therefore he says if the top line question about facebook and antitrust is about whether to break it up and spin off the likes of whatsapp and instagram, will this global coin which is the most invasive form of surveillance they could have devised thus far, this will easily become the most dangerous antitrust case in history if

it's launched and adopted worldwide we are bound to see facebook as the top ten biggest companies for the next hundred years and have complete ownership of the customer. what do you make of that >> well, i think that i invite that gentleman you just mentioned to read the documentation we put out today and he will learn that actually we painstakingly removed ourselves from governing this new network because we believe that a public utility shouldn't be controlled by any company i think you'd be hard pressed in modern business history to see a company that starts an initiative like this do so much to remove its influence over the very thing that it just helped create. >> david, it's an exciting project. we look forward to seeing where it goes and we wish you success with it. we appreciate you being with us from silicon valley this morning and of course julia who is in cannes this morning. thank you. >> thanks for having me. when we return, hershey's

turn around has been sweet the company cut the costs and focused on growing markets ceo michele buck has led the turnaround and will be our guest in a few minutes let's look at the equity datures, the dow is looking up toy. the s&p would open up by about 15 point and the nasdaq up by 68 "squawk box" will be right back. ♪ ♪ it needs to track it all, from cincinnati to singapore. ooo! ♪ ♪ and protect it all. customer records, our financials, they better be secured. but i also need easy access, to manage data across my clouds - no matter where it lives. ♪ ♪ so if an auditor shows up, i can be a step ahead. that's the cloud i want. is that to much to ask? expect more from your cloud. ibm cloud.

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the hershey company is

celebrating its 125th anniversary today. so far, pretty amazing 2019 has been great for shareholders the stock is up 20% year to date and if you look at the return of the ipo in the late '70s the shares are up 13,000%, but who's counting joining us is president and ceo, michele buck we should have brought cramer in here is he the charter member of the michele buck fan club? he says such positive things about what you have done at hershey's since you came on board. >> well, we appreciate it. we couldn't be prouder of our performance, thrilled that the stock hit an all-time high this year, the year of our 125th anniversary, and we just feel good that the strategies we put in place around being an innovative snacking power house reaccelerating growth on the u.s. core confection business, expanding to capture new incremental snacking occasions and pushing to get our profitable international business have really helped you drive our performance.

>> is it june, michele i'm trying to remember when you were on last on the golf course, do you want to take that shot over when were you on last here >> i think it might have been october. >> do you want to take anything over you gave us your strategy in october. i think you want to -- things have gone pretty well since last time you were on probably not because of "squawk box" but you don't -- you don't want to take anything over the stock is up 30% or so. >> from a year ago, we're up from 90 to about 137, 138 right now. so clearly i think our strategies have taken hold i think we're delivering for today. we're also building the capabilities of the future. >> you told us what you'd do now, to be fair, defensive issues have really taken off with these -- as recession fears have come back in to focus >> yeah. >> a lot of defensive stocks have done well, but it doesn't explain this you didn't take my advice about

gummy snacks, it is still all chocolate. >> yeah, we're pushing the gummy business but it's chocolate. >> is chocolate healthy for you? >> hey, consumers are looking for eating every different type of snack and chocolate in modulation, absolutely. >> there's probiotic chocolates - >> well, chocolate has antioxidant. >>s if you're blindfolded, if you had your competitors' products and yours could you tell the difference? >> absolutely. this is a category that we have beloved brands and each has an iconic form. look at the hershey bar, look at a reese's cup. there aren't big players that look like that same can kit kat and kisses. >> what are the new snacking opportunities? what does that mean? what are we snacking, how you going to get into that >> so we expanded the snacking if you think of the current

portfolio it is more focused in indulgent and sweet snacking but we're expanding into better, few and savory i think when we were on last we talked about the acquisition of amplify which is skinny pop. so, you know, consumers are looking for different types of snacks so we want to offer every snack to meet them. >> what about cbd? would you put that in chocolates >> we are constantly evaluating any consumer trend or consumer trend, it's a huge trend so we're evaluating it. we have no plans at this point in time and frankly there's some work to do from the regulatory perspective. currently, it is not legal to ship intrastate a food product that has cbd. >> like a cbd gummy or kiss? >> not today. >> wouldn't that be something? >> we'll continue to monitor that. >> what is the biggest age group that eats chocolate? young or older people? >> it is consumed by the masses really we are a category that has 95%

household penetration so everyone consumes across the range of portfolio of products that we have. >> is there a limit on how much chocolate that a consumer can consume and still be healthy >> we believe in transparency and in moderation. people know that chocolate is a treat. most people -- except for perhaps joe who is passionate about our brands. >> how much chocolate do you's in a day >> it comes down to the equivalent of a bar a day. >> but michele, your brand -- your branding, i don't know if you need to do anything else, although a thin reese's is a good idea. have you got costs under control? is that what you have done since october? >> yeah, we have clearly -- we have accelerated growth on our u.s. core confection business. >> with innovation and new stuff or advertising >> well, really, we have the season's business. we have had success driving seasons. we have expanded distribution.

great innovation, we're really excited about the reese's things that's hitting the market and the standup package that are much easier for people to use. and kit kat duos we expanded with amplify that's helped us. we did cut costs >> i don't know about this stuff. >> that's more kids focused. >> i pack -- i pack stuff with it -- this is different than the actual packing material, right >> pre-k and kindergarten? >> can i throw out a food question a little bit broader. beyond me, what do you think - >> beyond chocolate. >> i think food is evolving and trends will continue to evolve i think there's opportunity there. and, you know, i think that would be great so we're thrilled the business is doing well and the other thing is we're thrilled to be celebrating our 125th anniversary. milton hershey founded this company in 1894, he was an entrepreneur and he brought chocolate to the masses and his philosophy was doing well by doing good

we continue with that philosophy and we're actually this week doing a teen summit to address one of the biggest issues with teens today which is social isolation. and really emboldening teens to help come up with solutions -- >> makes no sense with all of the ways that that - >> all the media platforms but not the same kind of personal connection. >> worry about that -- instead of chocolate, why don't you worry about that >> the chocolate is the best in the world? >> i believe so. >> the questions - >> grow up with taste profiles and people believe that the american chocolate is the best. >> michele, thank you.

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i live on my own now! i've got xfinity, because i like to live life in the fast lane. unlike my parents. you rambling about xfinity again? you're so cute when you get excited... anyways... i've got their app right here, i can troubleshoot. i can schedule a time for them to call me back, it's great! you have our number programmed in? ya i don't even know your phone anymore... excuse me?! what? i don't know your phone number. aw well. he doesn't know our phone number! you have our fax number, obviously... today's xfinity service. simple. easy. awesome. i'll pass. welcome back to "squawk. we are now 503 days a way from the 2020 presidential election but will corporate america show up to support president trump with campaign dollars? that's the question this morning and eamon javers has perhaps the

question. >> hi. the president will switch from make america great again to keep america great. the new slogan for 2020. the president will be in orlando, florida, today. announcing his re-election campaign and that presents corporate america with something of a dilemma do they back this president publicly with their campaign cash typically for a republican president running for re-election that would be a no-brainer, but this is a different president in a different era. take a look at some past republican presidential candidates and how much they raised from business and you see george w. bush raised $2.1 million and mitt romney in '12 raised almost $1 billion from business pacs and president trump raised $47,000 from business pacs those writing through the political action

committee directly to the drum campaign as opposed to super pac or another organization. that's a very low number and that the president could struggle this time around to match even that figure given his agenda and the way it's split the business community. some consultants in washington suggest that the president's tariff agenda really changes the picture for business which was largely supportive of his low tax initiatives early in his administration now, tariffs, attacking companies by name and broad public opinion may prevent companies from being willing to write those checks directly to the trump campaign, guys a lot on the minds of corporate america today as we watch the president begin his re-election. >> eamon javers, thank you for that bider had a fund-raiser in new york with jim che knows where they announced he had raised $20 million. >> yeah. let's bring in our guest host david rubenstein, founder and

co-executive chairman. ever backed a nondemocrat? >> i haven't given money in 25 years. >> but you have preferences on -- in the democratic party, who do you like this time around >> well, i know a number of them i think they're all really talented they could all do the job. >> what do you mean, all 22? >> just the ones i know. >> who do you know >> joe biden i know kamala harris i think she could do the job very well. i think that many of the senators who are running i think are very well qualified. but it's too hard to tell. it's too early to know if you go back ten years -- or the last ten presidential elections and say a year in advance who is likely to be the next president you'd be wrong almost every time. >> when -- you don't need to go to bernie sanders or elizabeth warren for the democratic plank or whatever you want to call it if you will. but just in general with the center of that party right now, what are the policies that

they're espousing that you find favorable so that you're positive about the prospects for a democratic candidate for president? >> remember, democratic candidates say a lot of things and republican candidates say a lot of things and governing is different. >> so the crazy things we're hearing about, you don't need to worry about because they won't happen are there any of them you wish would become policy? >> i think it would be a good idea if the republicans or democrats would work together. that's the best thing. >> how about medicare for all. >> i don't know what it would mean, but probably wouldn't be something we could afford. >> how about free college education? >> i don't think's affordable as we now understand. >> are there any of the policies that are getting all of the attention that you think is would be positive if they were put into law >> sure. i think it would be good if we were to work out our health care system, make it better than it is i think everybody wants to do

that medicare for all is -- i think an improvement on what we have is a good idea. >> how would you raise taxes, how would you do it? and then what would you use the money for? >> well, right now, the deficit we have is very high it's $1.3 trillion and we have $22 trillion in total debtedness, we ought to reduce the deficit. >> that's not what the left is talking about. they're talking about expanding entitlements, infrastructure no one is talking about raising taxes to pay down the debt. >> i believe we should reduce the deficit and i believe we should focus much more on income inequality by getting people educated to the greater extent for example, 14% of americans are functionally illiterate. we're letting people drop out of high school prematurely and those in the criminal justice system - >> what does that mean, school choice, charter school >> try to get people to stay in school longer. making certain that people get better educated. >> is that a function of money

though that - >> it's not -- >> are you for charter schools or for or against school choice? >> i'm in the favor of the best public school education you can have, but also charter and private schools can work it's not the forum, it's goat getting the parents or guardians involved as well, and rising up in the system as i think i did. >> where would you raise taxes on who and how would you do it would you like the wealth tax? >> i'm not - >> would you rescind -- would you hope they rescind the tax reform bill of trump do you think we should raise corporate taxes? >> i think it's unlikely that the current tax bill if the democrats win the white house will likely stay in place. >> so i was -- so would that be something you'd -- as a supporter there -- >> well -- >> would you hope they raise the corporate taxes back >> we need to make sure that the social security is solvent.

>> do you think we should go back to the higher level for the corporate taxes? >> you can't say we -- >> you won't toll me >> if i heard the tradeoffs i would make the decision. >> what about marginal rates on individuals, would you raise those? >> i would have to see it as part of the package what is part of the whole package. >> what about carried interest >> as part of the package i have to see what's part of the package. you can't say one thing alone. what is the impact of that on other things and - >> but generally - >> everything you're saying makes sense to me. >> i didn't hear him say anything. >> you're in the center here. >> i haven't heard an answer to a single question. >> generally -- >> well, he's telling the truth. >> do you feel it's necessary to raise revenue? >> i think we need more revenue, yes. and we have to cut some spending but we need more revenue in large part -- >> do you believe we need to raise taxes or do you think there's a way to create more revenue by either lowering taxes

or doing - >> higher growth will raise more revenue. >> correct. >> if we could get to 4% growth, we would solve a lot of our problems >> do you think that's realistic or - >> it's harder than it used to be it's harder than it used to be with an economy of our size. but a goal of 3 to 4% growth is a good place to be have. >> infrastructure, public and private? >> infrastructure is unlikely to pass the democrat any time soon. the republicans and democrats can't agree on how to finance it and who to pay for it. i think it will be done more through the states than the federal government. >> how much with new green deal talk -- and that's a major plank, it really is. even biden just came out the most -- you know, center candidate at least that's how he's labeled is on board with some very -- it would be very costly some of the initiatives that we're talking about is that something that you think we should -- >> even the opponents of it said, all the details haven't been worked out.

it's basically aspirational. >> we need to have that discussion we don't want to take this stuff seriously, but let's have the discussion. >> all people who run for president say things realize when they become president how difficult it is to you have to live in the world of reality as president trump learned. everything he wanted to do he -- >> he's done a lot and has gotten a lot of push back too. >> if you were elected president of the united states whatever you might have campaigned on you would learn that you can't get everything done that you like. one of the reasons that president trump i think likes tariffs it's something he can do unilaterally it's very difficult to get things done in washington unilaterally. >> it's much more difficult -- >> much more difficult ten or 20 years to get something done in washington. >> thank you very much for being with us today. >> my pleasure to be here. >> great to see you. when we come back, former snap chief strategy officer imran khan will join us. plus, who llwi the ceo randy

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new this morning, facebook is launching a new cryptocurrency called libra. details straight ahead. hulu's ceo joins us on cnbc and we'll talk content, advertising and competing with netflix. plus, how a new e-commerce player plans to take on amazon snap's former chief strategy officer joining us with his

image. 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 welcome back to "squawk box" here on cnbc, live from the nasdaq market site in times square i'm joe kernen with becky quick and andrew ross sorkin the futures have steadily improved in terms of being positive now now we're up 153 points for those of you on the highway, right now. 157 points now on the dow jones. the s&p is up just under 20. and the nasdaq has indicated after a good day yesterday up about 83 this morning. treasury yields are indicated now at -- trading actually at 20 is, we are almost at the 1.0 handle now

draghi comments i guess helping yields fall. helping the firm up across the globe in terms of treasuries. here are the stories that the investors will be talking about, facebook unveiling new cryptocurrency plans this morning. the digital currency is called libra and set to launch in the first half of next year and it will be backed by real money and facebook is partnering with two dozen of other companies and nonprofits to start with libra and will create a new digital wallet run by a subsidiary boeing has been booking the first new airplane orders at the air show there are plans for new 787 jets and the company recorded no new orders on the first day. rival airbus added orders and options for 123 jets

and the federal reserve begins a two day meeting today we'll get an interest rate decision and policy statement tomorrow afternoon followed by a news conference by jay powell. some are expecting a rate cut and others see the fed merely setting the stage for a future possible cut we'll get to our guest host for the hour, imran khan was the chief strategy officer at snap parent of snapchat he's the cofounder of verishop, e-commerce company that's taking on amazon. he's on the advisory board -- a member of the cnbc's technology executive council. good morning and thank you for coming in. >> thanks for having me. >> on day one. tell us what this is about >> yeah. verishop, we want our -- our vision is to be the home for all brands so we want to be the destination site when consumers are looking for branded products or products that requires trust or experience if you look at the last 25 years

as the internet evolved, most built on the premise of open platform where anybody can come and talk to each other and post things and what we found in the last 25 years that a society without any rules brings a lot of chaos so there are a lot of counterfeits and fraud in marketplaces so we're building a platform that brands can go safely knowing that's no counterfeit product. >> this is a direct shot at amazon. >> i would say if you look at retail, it's $5.5 trillion market it is by far the biggest market. it is bigger than ride sharing market, bigger than food delivery market. and e-commerce as a percentage of overall retail sales is only 10%. so i think we are so early on this journey that there could be multiple, multiple very large businesses could exist. >> let me ask you a policy or a philosophical question therefore, you don't think amazon is a monopoly. >> i don't think amazon is a

monopoly. >> and therefore shouldn't be regulated? >> i think in general there's -- the way i think about it is that if a company has become really big or very successful, they're not necessarily -- we shouldn't break them up. but we should scrutinize and make sure that they don't involve in anti-competitive things and they don't reduce consumer choice so as long as they don't do it, i don't have a problem with amazon. >> let me ask you about creating a marketplace -- i don't know if you're describing it that way -- >> online retailer. >> for brands. there are a lot of brands that don't want to be on amazon right now. >> absolutely. >> for lots of different reasons, in part because they also are a marketplace and there's other people who are selling them there's -- there are counterfeit issues but less so on a place like amazon, no? >> i think any time there's an open platform and anyone can list or post you cannot guarantee quality or authenticity. >> what do you make though of what's clearly a trend which is

direct to consumer so many brands out there -- i was looking to see what sneakers you were wearing they look like the albirds, they don't want to be on somebody else's platform. there are so many new emerging brands that don't want to be on somebody else's platform do you attract them to your platform or looking differently? >> i think it's a great question and i think, you know, one of the things that i noticed at snap that when i first started to build the ad business, my advertisers were mobile game developers over the years we saw a lot of direct to consumer companies coming in and buying up the key words and driving it higher but they don't have the breadth of selection. so when everybody builds the same kind of product they drive it up so i think the brands will need a new place to distribute the product. direct to consumer is not a new concept. there are a lot of brick and mortar business that have physical outlet and they sell in

the department stores. i think most of the brand will need to the new outlet and we're building a brand safe environment for people to discover them. >> how does that relationship work between brands that are probably -- many of them have their own e-commerce sites too that's why we have seen some brands have been reluctant to get involved with amazon they'd rather be direct to consumers themselves >> right you're absolutely right it's difficult for brands to get involved because the moment they show up, their production shows up next to the fake product and people write negative fake review and you can't regulate your brands. there's no counterfeit, you don't have to pay an advertisement to show up on the top of the site. in the same way, we make it easier for consumers you don't have to go to the 100 different sites. >> what you're describing is like a department store for online. >> it is. >> retailers for a long time -- i mean the brand companies for a long time have wanted to break

away from the department store because they didn't like being cloistered there do you have much looser regulations than the department stores have? you're not charming them nearly as much as a retailer would? >> yeah. i think it's -- we want to create a win-win situation and we're creating a new ways of discovery. if you go to the site you will see that we have this thing called taste maker shop. you can go and find what the influencers have picked from the stores so it's a new way of discovery. we have responsible shop which is if you care about cruelty free, sustainability, you'll be able to find those products much easier in one place. by aggregating it easier we make it - >> and they have their own online stores. >> many of them do. >> what will it make people come to you one thing i like about facebook is they can ship it within a certain number of days will you have that -- >> yes, we're starting with two free day shipping.

you can buy a $10 product and it will be delivered in two days. >> all in your warehouses -- >> in my warehouse, in our warehouse. >> let me ask you about discovery which is to say i assume you have to spend a lot of money on advertising and having lived at snap on places like facebook and instagram. also on google i imagine on snap and potentially twitter and other places there's a large conversation going on in this country right now about the size and scope of a google and a facebook in terms of how much of the marketplace they control we have asked guests if you couldn't advertise on the google or the facebook could you have a business in this environment and exist? are you worried, anxious, upset about the scale and scope of these businesses right know? >> no, i'm not you know, i think again i -- we competed with facebook fiercely. it's very well telegraphed i think that the big thing again i want to take -- i have been talking about facebook or google

or amazon. as a policy level, as the company beginning big, it's not a crime. you know i think one of the greatest things about america if you have a good idea and if you execute well you can build big businesses and so i believe in that -- i believe that is still possible in america despite the big companies. i think what we need to make sure that they don't do that is quote/unquote illegal practices and i have no reason they have done that. >> do you believe that you could create a viable competitor to a facebook/instagram or a google or a snap today? meaning do you believe if you met -- another evan out there could emerge and create a significant and viable competitor >> i think we're looking at the world much more narrower i think over the next 10 to 20 years the social network, the way we see it, will probably evolve significantly and new platforms will arise

think about it 15 years ago, there were no social platforms 15 or 20 years ago i think 20 years from now there will be a new platform and new leaders so i think the biggest challenge for the companies can they evolve in the new platform? i think you can see that 30 years ago, an advertiser who said that i'm very upset with nbc and cbs because those are the only two places i can advertise. but look how the world has changed. so i fundamentally believe the technology innovation in this country and globally will continue to change so rapidly that we'll see new platforms >> okay. now that the snap chains are off, be honest the most effective platform you think? for you in terms of advertising. >> i think it's too early to say because we'll test all of the platforms. and whoever is the best ally we'll invest there but we haven't started to advertise yet. >> you haven't advertised yet.

>> no. we went live today. >> but it will be a snap story -- >> yeah, look -- we want to build the business for the long period of time i think the best way to build the business for the long period of time is to provide the best value and rather than spending a lot of money in advertising, my philosophy has been let's take some of the dollar and invest in better expense we're providing two day free service. and no minimum. >> why do you think the department stores haven't been able to do this? maybe they have. >> i think you need to really invest in technology and really need to invest in discovery. really need to invest in convenience. e-commerce is a hard business to build. you know, i'm in this for six months and i can say it's a much tougher business to build. but i think it's an -- it's a great story. >> thank you

you're sticking around we have a lot more from you. coming up we'll take you live to cannes on the french riviera and the world's largest ad festival. we'll have an interview with the ceo of hulu. how will the platform stay relevant in a fragmenting streaming industry and what does disney's control mean for the future of hulu content those answers and more when "squawk box" comes right back. this cnbc program is sponsored by land rover, above and beyond

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welcome back to "squawk box. futures right now up almost 160 on the dow with the s&p indicated up 20. as in contact indicate up 87 and chain. shares of mattress maker temper sealy are higher the two year estrangement with mattress has signed a new contract they parted ways in 2017 and accusations of trademark infringement were the reason and breach of contract. the largest ad festival is taking place this week in france with marketing and media players

attending. also our own julia boorstin. she joins us from cannes with a special guest. >> thanks so much. i'm joined by randy freer, the ceo of hulu. thank you for talking to us today. >> thank you for having me. >> one of the big topics of conversation here at cannes is concerns about the digital duopoly, facebook and google, a potential that the companies are make broken up, according to some of the presidential candidates raising these issues of antitrust but the real question that most people have been talking about is the safety of thecontent that advertisers are putting their ads next to. are all of these discussions an opportunity for hulu to gain ad revenue from facebook and google >> the reality is hulu lab continuing to grow the ad revenue business i think the most important element for brands and for others is to know that they are in a safe environment. and really that comes down to the choice as long as we as businesses give consumers a choice as to what

they want to watch, where they want to watch it, and ultimately how the ad experience is in that scenario, i think we'll be in great shape as well as brands giving brands the choice of what they want to advertise in. i think that's one of the things that's made hulu an incredibly popular with brands today. >> we have been talking to some advertisers here including the head of marketing for procter & gamble and he said the fact that people are watching netflix where there are no ads and not tv in increasing numbers means they need to find new digital places to put their ads on videos are you reaching out to the brands to say move more dollars because of netflix to hulu >> we we went to target and p&g for a long time and the opportunity for hulu with huge audiences at this point, with long engagement times, a young audience, 20 to 25 years younger than network television or other places, hulu is a huge opportunity for brands to come in and talk to the consumers

that they're looking to reach the most. >> now disney recently announced along with nbcuniversal that disney is going to be taking over control of hulu what does that mean for hulu's future and your ability to plan for the long term? >> well, i think the first thing is it's clarity. there was always a lot of conversation about who was going to own, what is it like, how did they all get along and they all got along great. but now there's clarity of voice. there's clarity of objective i think we're solidifying into the clarity around our strategic plan and what the next couple of years look like. we're super excited about the opportunity. >> bob iger has talked about potentially bundling in hulu along with disney plus which is allowing this with espn plus what does that nicotine for your subscriber base going forward? >> i think it's opportunity and we haven't determined or been told what that bundle is going to look like and what the ultimate price is. but i think the opportunity to have the best of general entertainment direct to consumer

what will be a tremendous service with disney plus, the best for kids, from movies, like pixar and others, is going to be terrific then when you think of espn plus as an add on as well to hulu's live product and what consumers are looking for i think it's another way for hulu to extend and grow its already fast growing subscriber base. >> we are about to get a couple new entrants into the market that will pose as a competitor to hulu. most of your subscribers are using the ad service but at&t will have an ad supportive version and disney is going to be launching an ad supported streaming service. how do the coming rivals impact your business and your strategy? >> one, you have to get back to really thinking about the consumer and making sure it's

consumer friendly and even better hulu used to say we had half the commercial load as network television and we have to begin to reduce that and find new ways to integrate the brands into the ad that's why we launched pause ads recently we launched a number of other ad formats. friends with benefit is an integrated opportunity we're using with old navy. so there's all kinds of ways to make the customer experience on hulu better than any of our competitors out there. and we can't forget that the most important thing to consumers is choice. so it's great to have an ad service but also what's more important is giving them the option of an ad service and the option of an ad free service so they can determine what's the best way, what's the best experience they have to view things. >> there are other ad free services like apple tv plus that are about to come into the market and amazon and netflix are spending billions of dollars on original content how does that -- now your full ownership and controlled by disney change your approach to

investing in originals rather than just a lot of the net work content that's so popular on hulu >> you will see over the next few years that our investment in original programming will increase significantly we now have access to the best creators in the world. when you look at the capacity inside of the walt disney company to create content, the ip that's there, the access we'll have with that is you know terrific we are going to be able to invest more and invest more upstream and find the best stories and the best creators to make shows for the company. >> can you give us a dollar amount >> not at this time. >> well, i had to ask. andrew, back over to you. >> thank you for that interview and give our best to randy when we come back a lot more on "squawk." closely watched housing data for the month of may it is out in minutes we'll bring you the numbers and the market reaction. and then later jeremy liew,

what he learneasd the first vc to back snap stay tuned you're watching "squawk" on cnbc

welcome back to "squawk box. the futures check them again 162 on the dow s&p up about 20 premarket. and the nasdaq up just under 88 points after a strong session

yesterday. well, we have been picking up all morning long with the futures. still to come key housing data is on the way in a few minutes the numbers d e rkanthmaet reaction as it breaks. stay tuned you're watching "squawk box" here on cnbc

♪ welcome back to "squawk box" on cnbc. we are live from the nasdaq market site in times square. our guest host this morning, imran khan, the ceo of verishop. thank you for coming in. we have time for a couple of questions but your suggestion i have been through verishop and looking to check things out. i think one of the things that's probably to your advantage is that you have this merchandise in house but there's also something that creates a bigger risk for you. >> it does that's why we need to have better analytics, to what we should be buying we have a fabulous team of buyers who came with a lot of experience we have employees with nine years of experience and we have

50 employees and we have to dig into the data. netflix creates content we're trying to bring that to e commerce. >> this will get bigger as you grow, but how much did you start off with >> 1,300 styles and more than 10,000 sizes so sizable. >> how do you pay for it do you get financing >> you can do vendor or bank financing and which used our capital that we used. >> is it a big start-up cost >> it is a big start-up cost i think that's why you're seeing that e-commerce is a percentage of retail is still very low. because for social media you create a product that works and then there's a lot of up-front costs. you have to get a fulfillment center, sign contracts with distributors and things like that but i think it's a large market by far the biggest market i could find. >> it's a big barrier to entry but a good barrier once you have made it over the hurdles >> right. >> imran khan will be with us. he's talking about the new store

opening online today, verishop.com we're awaiting the housing data. the dow futures have been picking up throughout the course of the show, up about 165 points even after the gains we saw yesterday and over the last few weeks. rick santelli is standing by, he as the housing data. take it away. >> yes, for our may read on starts and permits, starts, 1.269 million. that's sequentially follows an upwardly rise 1.28 million with regard to permits. what may lie down the road 1.294. don't see a revision so these numbers are very close to expectations. arguably starts is actually better than expected but maybe the big news today is mario draghi's big surprise, not to be outdone by current fed meetings or bank of japan. bank of england. the ecb that had their meeting a

coup couple of weeks ago, floating more liquidity quantitative easing program which ended basically in december is back on the table. boy, that just helps everybody, doesn't it look at the italian banks. the italian banks, they're not helped, their shares are going down four out of the last five days many of the banking indexes in europe are on the weak side and housing starts revision as i pointed out at 1.28. that was a nice one from 1.25. ultimately yields in europe are darn close to minus 30 basis points negative overnight of minus 40 maybe expanded at the next meeting and of course all of this getting synthesized into the equity markets to some extent although in japan in 1989 their market was close to 40,000 they're not necessarily benefiting their equity markets. maybe that is the lesson that we should pay more attention to

but no matter how you slice it the first day of a two day fed meeting many believe that nothing will change today. maybe the table will be set for future meetings with regard to easing, especially considering all central bank stimulus is fun jim. the tidal waves of liquidity are splashing on the shores of the u.s. back to you, guys. >> rick, stick around. i don't see liesman. he was here earlier. steve liesman joins us now oh you made the -- you went across the river is that where you are? >> yep up the highway, over the bridge and -- >> through the trees. >> to grandma's house. >> did you pass go, did you collect $200 >> i did not, i paid the toll, as you know. so the starts -- headline is that they're down but that a's not really the real story here the real story is that upward revision to april helps out overall. so you're down a little bit from the up wardly revised number in

may. bottom line, we might possibly get a reversal in the housing effect or the residential effect on gdp it can begin in this quarter -- you can see five straight quarters of -- what is that? eight out of nine there where housing has subtracted from growth the next two we could be getting possibly in this quarter here at least to zero which would help maybe even a positive addition, depending on what's happening with residential improvement a quick look, kind of echoing what rick was saying of the fed probabilities. 30% for june that's a pretty high number but pretty high percentage but 86 for july. pretty darn short so the fed steps up to the plate or the market gets disappointed i want to show you real quickly the fed expectations chart we had an error in the prior one and this is the correct one, 67% said a rate cut is expected this year 22% say the fed will be on hold

for the rate and 11% say a rate hike and everybody says one cut on average this year but those who say the fed is going to cut, they see two cuts coming, guys andrew >> thank you for that. a few stocks on the move, bank of america upgraded to outperform from market perform at bmo capital the consensus said it's too low. looking at that stock up a little bit pinterest waited outperform at web bush it's a fundamentally different than other social media platforms and the ability to lead to sales of products and services shares of pinterest right now up about 2.5% you guys might use pinterest, right? >> we'll look into them as well. >> are you a fan >> i think they have built a really good business. >> differentiated from other social media >> yeah. i think it's more retail oriented and the demographic is very different it's more female, older

demographic, compared to snap or other domains. >> thanks. when we come back, long time venture capital investor jeremy liew on the hottest tech sector ipo's. he'll join us to talk lessons learned. plus we'll get his take on thnee w cryptocurrency play by facebook stay tuned you're watching "squawk box" right here on cnbc introducing the first of its kind lexus ux

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away from the opening bell dow jones looks like it will open up at 155 points higher right about now. the s&p close to 20 points higher and the nasdaq 8 at points higher. making headlines, amazon announcing it will lease 15 boeing 737 cargo aircraft from g 2 capital aviation the e-commerce giant has been taking steps to build the one day free shipping service and earlier this year amazon said it would invest $800 million to make one-day free shipping the standard for prime members i'm scared for you, imran. no, i'm just scared. like, okay, i'm starting -- you know, done well. starting another business. i think i'm going after amazon. >> market is really big. >> go after somebody else. >> i think you sound like my friends. when they found out i'm building an e-commerce business they thought i was getting crazy in the old age, but i think the market is very large

any of the products, you're wearing did you buy from amazon? >> from last week, but not what i'm wearing now. >> i haven't bought any dresses from amazon. >> or anywhere else. >> ever bought anything on like mr. porter >> i have gotten shoes from amazon. >> okay. >> so i think the market is really big it's a $5.5 trillion market. look, advertising business that we talk about google, facebook, snap, twitter is in the u.s. is $250 billion so i think, you know, i don't really think this is a zero sum game amazon does a really good job and they taught what the best customer service looked like and we should try to learn from them. >> we hear uber's ecosystem market cap and that has to pale in comparison to the online retailing. it's up in the ts. >> $5.5 trillion and only 10% is online so i think -- i know media likes to talk about amazon, they did $220 billion >> is it too late for me and

andrew and becky to give you some money what -- are we a start-up? ground level or are we am -- am i like a late stage uber investor >> like a libra. >> yeah. >> i appreciate your trust >> but it's early for -- >> very early. >> not as early as the next guest was able to get in with him. >> so can i get in where he got in or too late >> i don't know if i can -- talk about it on the air. >> you're right. >> all right facebook unveiling the cryptocurrency plans this morning, and we spoke with the head of the program, david marcus, about the launch and about filling a niche that he says doesn't exist when it comes to crypto. >> but if such a network already existed today so a blockchain that can scale to serve billions of people, a digital native currency that is stable and of a very high quality then we would haven't to worry about creating

that and my life would be simpler. sadly it doesn't exist and we felt we had to try to accelerate the time line of creating those new technologies to bring those solutions to market. so - >> joining us now to talk about facebook's crypto plan and much more is jeremy liew, light speed venture capital and an early snap investor and an investor in the latest venture from imran khan, the ceo of verishop. both worked together when it came to snap why don't you talk about when you first imran and how your friendship came together. >> yeah, absolutely. we were the first investors in snap and so had been involved with the company since the inception. when imran came on board as the chief strategy officer we got to know him very closely as well, given his very important role at the company. so as he started to roll off from snap last year, started to think about what was next we started to talk about what was it and we got very excited about

the opportunity with verishop. >> let me quote back something that you have said you have said like the alumni of paypal and other great companies snap employees will go on to build a new generation of start-ups. we are thrilled to fund the first of the snap mafia. so what excites you about verishop >> i heard you guys talking a little bit about -- you know, the huge market in e-commerce and also competing with amazon and i think what's interesting is if you look at some of the most recent well performing ipos, companies like revolve, chewy, stitch fix, which is a company portfolio of ours as well, you see the companies that have been most successful and have built the most value have been multibrand retailers and competed with amazon and have taken them on and found areas where they're not strong been able to demonstrate that you can build multibillion dollar companies in this space.

>> one of the things we have been talking about with imran is just how this is different than the situation like snap where there's very low barriers to entry. in a situation like this you actually have to go out and build a warehouse. you have to buy all of the merchandise and hope that the people will come and buy it from you, and create that customer place that they want to be is this different from many of your other investments that you make >> i think that you find two different kinds of companies that venture capitalists invest in you have the brave new worlds like snap and you have the better and faster companies like verishop and both can build a lot of value. >> who do you decide between the two sides of investments do you have different ways between each of the different companies? >> well, a better, faster, cheaper company like verishop it's all about executional excellence and the quality and the founders is really critical

in terms of being able to build that because it really is about being able to deliver on the value proposition against a market that you understand and make sure that you can build the organization that can do that. a brave new world company like snapchat is about a founder's vision to imagine something that doesn't exist today. and to have the drive and product chops to be able to deliver on that. both can be valuable companies and they just require different sorts of management teams to go after them. >> jeremy, what do you think about the news we have today with facebook talking about the new cryptocurrency or something that it's launching. i'm not sure it's a cryptocurrency but it's looking for a way to help bank people through a platform like facebook. >> it seems like a really smart move by facebook if you think about -- you know, here in the u.s., we have the rule of law. we have pretty high levels of trust in the government to manage the monetary supply we have pretty good faith in our

financial institutions and so we don't necessarily see the need for a stable coin of the type that facebook is launching with libra. but if you look to parts of the developing world, that isn't necessarily true if you think about, you know, if you're in venezuela or parts of the middle east, parts of africa where the governments are less stable where the financial institutions are less stable, if you were able to, you know, store your wealth in currency you may well have more trust in facebook and the organization of corporations that are backing libra than you might have in your alternatives in those places >> hey, jeremy, you're in the middle of silicon valley and there's a huge debate not only over private but size and scale. you have imran going after amazon do you look at a facebook, at an amazon, at a google and say

there's a problem with the size and scale today? >> you know, i'm leave that to the -- i'll leave that to the regulators to determine but i will say as a founder of start-ups i don't worry about the opportunity for start-ups to build businesses against facebook and amazon and google and i think there's plenty of existence proof that companies can be successful. look at the rise of tick tock in the social networking space and stitch fix and chewy and revolve, they all had very successful ipo in multibrand retail completing directly against amazon in many instances. and i think that if you look at those big companies, then, you know, perhaps any company can only have three priorities they can focus their teams on at a time after they put their a-teams on the top three priorities then the next three priorities have

their "b" and their "c" teams. it's tough to beat the a-teams like amazon and facebook and google but a start-up that only has one area of focus can certainly beat the "b" or the "c" team of any of the big companies. >> if the department of justice called you and said, you know, do you have any problems or examples of behavior that are problematic you would say nothing? >> no, i would say that there are some instances where i think, you know, yelp has gone on record, for example, with some challenges that they have had with google and review data for local businesses and i think there are some other examples out there. i'm just saying it's not impossible for a start-up to beat these guys. whether or not the playing field could be more level i'll leave that to the regulators to decide. >> what -- imran, when you start hearing some of these things

too, talking about big regulation going after amazon does that play into any of how you went after this thinking that amazon is going to be preoccupied with some of these issues or won't be able to be as aggressive as in past? >> honestly, i did not think any of those things and constantly i think, you know, i have seen that in advertising world, like with snap, right, you know, i think people always think it's a zero sum game. but not one company can solve all the problems there are some things that amazon does phenomenal i'm a shareholder of amazon and we buy every day from amazon but i think that if other things that we can do better. that's what we're trying to do and the market is very large. >> when will you know if you're succeeding what are the metrics you're watching right away? what do you expect is this a slow ramp as you have to get the word out? >> a great question, yes, it will be a slow ramp. if you look at the e-commerce companies they take a long time to build i think you need to understand your customers, how to serve

your customers better. some of the metrics we'll look sat the retention rate, repeat rate those are the things but i think one of the key things we want to do is we want to be maniacally focused on consumer experience. we want our customers to be happy and if you do that over time we can build a big business as market continues to shift. >> how many brands do you think you ultimately need on board >> yeah, so we started with more than 160 brands and i think we're projecting more than 300 brands by the year end i think you get to the few thousand brands in the categories that we have, we start -- you start to saturate it so i think we'll be more and more - >> you can pitch them right now. what's the one big brand you'd like to see on the platform? >> i think we talked ago alberts, we don't have shoe category right now but i think we'll get in there next year. >> jeremy, thank you for coming on with us today

we appreciate your time. >> thank you the gold markets are paying close attention to central bankers today. the fed has a policy decision due tomorrow and the ten year yield dropped to 2.o03, the lowest level since september of 2017 earlier headlines suggesting that the european central bank will need to provide more stimulus if inflation doesn't pick up. >> in the absence of improvement, such that the sustained return of inflation to our aim is threatened, additional stimulus will be required >> eurozone money markets are now fully pricing in and ecb rate cut by december european bond yields, as you can see, now negative. negative in sweden i'm told for the first time recently. and getting, you know -- ours is lower? we're basically the same as

italy with all the problems that italy has and the u.s. president trump blasted draghi following the ecb's president speech this morning. president tweeted, mario draghi just announced more stimulus could come, which immediately dropped the euro against the dollar, making it unfairly easier for them to compete against the usa. they have been getting away with this for years, along with china and others. yet jim cramer we did not brand the europeans or chinese as currency manipulator it hasn't come it that i wonder if it is inflation or are these 30% recession fears, are they starting to actually be -- come to where it is realist realistic. and morgan stanley, you probably saw those notes. what do you think? >> we're a consumer economy. 70% of our economy is consumer consumer in good shape, employment is still strong, balance sheet is strong. why doesn't the president take care of the currency

manipulators mexico, manipulated the peso, europe manipulates the euro. these are all just tremendous advantages over us on top of the tariffs that the europeans have on us. i don't get it i think he's too inconsistent on this stuff i think you got to go full bore. these countries are -- they have been taking our business for years. >> sounds look he wants to manipulate our own currency. >> it is very hard, very hard to do are you just going to take it down they tried to do that in '87, it doesn't work i would like to see recognition that they structurally reform europe, that's what is necessary. make the french have a stronger industrial background. what is going on over there? why don't they deal with their problem instead of trying to make it so we solve them. >> i said that -- i made the point that powell would have trouble cutting because it would be admitting he was wrong in

december and i got yelled at, left and right. >> by who? did i yell at you? >> someone that works here that said -- >> tell them i live here, i live in summit -- >> powell could not have known that trump would ruin the economy with the tariffs, so he was -- but that was back when you were saying -- >> how could you not know? it is about china trying to beat us an take -- >> you were already saying that managers were seeing some slowness and that going up in december was the wrong thing to do you were saying it then. >> all the industrial companies i dealt with were saying, will you please tell powell, i have -- like i have a pipeline to powell. they're all saying why don't you say something? i said something but didn't matter. still tightened. the president was right. i know he's the president. we're supposed to hate everything i like him on the economic stuff. i'm sorry. i can't -- i like him.

i plead guilty a the lo of t the other countries want a piece of us. that's what it is about. china wants to become king of the world. i don't want red china rising. my position is not new the president's position is new. by position has been the same since 2000. >> powell was right, the economy going, trump kills the economy and then -- >> the economy was rolling over. it was rolling over in september. powell -- his researchers di very little work and he was unfortunately a rookie in october. learned a great deal now he's got to wait a little bit. looks like he's brow beaten by trump. but trump had a better feel for the economy. and powell didn't. powell is a young guy, not young, but young in the position janet yellen had much better feel about the economy so he made some mistakes, started talking about lots of tightening did a lot of things wrong and has to pay the price but i think the president has always had a right to criticize the fed. have i ever argued with you or

yelled at you? there is sissies if they don't come see me. man or woman, i don't care i'm neutral on that stuff. >> yeah. >> why would nsomeone do that, joe? >> i'm on -- i'm getting in some places where i don't want to go, jim. we will see -- >> this is about -- look at what draghi did draghi is saying, listen, you should fix deutsche bank, but in the interim, we'll protect you >> wray. >> fix deutsche bank mer merkel, what is she doing to help the cause what is she doing? what is she doing? she's buying soviet -- soviet, i love that, natural gas she's shipping engines over here to the bmws in south carolina. they build their recent plants in -- i don't know they're getting away with a lot. >> yeah, all right, jim. all right, jim. >> sorry to be so dan d'amico. i got to get him to be more harsh. >> that's true

all right, jim, we'll see you in a couple of minutes. i'll tell you about "mad money," an interhavview with union paci ceo lance fritz. think about grade school, where everyone thought he was fritz lance. that's at 6:00 p.m. eastern. >> or call him fritz >> tomorrow, on "squawk box," big lineup, target chairman and ceo briacoeln rnl. stay tuned see that's funny, i thought you traded options. i'm not really a wall street guy. what's the hesitation? eh, it just feels too complicated, you know? well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman? hey, ian. you know, at td ameritrade, we can walk you through your options trades step by step until you're comfortable. i could be up for that. that's taking options trading from wall st. to main st. hey guys, wanna play some pool? eh, i'm not really a pool guy. what's the hesitation? it's just complicated. step-by-step options trading support from td ameritrade

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welcome back we have been watching shares of beyond meat surging again today. this time 12% jump after yesterday. look at $193.50, folks get yourself a beyond meat burger >> sausage is pretty good. >> they say the sausage -- they say the sausage is the best of the bunch. >> it is not even healthier than regular sausage, right >> you have to get out of your head about the health benefits that's not the argument here it is -- >> then you lost me. >> it is all about -- >> carbing and calories and -- >> spare me. >> that's not the --

>> if you stopped driving and flying walk the walk, sorkin. >> i'm not -- >> walk the walk stop your carbon-based lifestyle. >> i haven't tried that yet. >> that's it for us today. join us tomorrow right now, time for "squawk on the street." ♪ i don't know you ♪ not like i used to good tuesday morning welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber at the new york stock exchange. big morning. the fed meaning begins global bond rally under way, draghi hints at more stimulus, futures green. s&p less than 2% from an all time high. europe has some gains, the ten-year awfully cles itose to e handle facebook's key commerce play, the tech giant unveils a new digital wallet and cryptocurrency shares up premarket. >> trump versus