good morning it is 6:00 p.m. in saudi arabia, 11:00 a.m. on wall street. "squawk alley" is live. ♪ ♪ ♪ ♪

good monday morning. welcome to "squawk alley." obviously watching the dow down 142. oil is the story of the day. prices surging following attack on the world's largest oil production facility in saudi arabia, disrupting the global supply of crude. brian sullivan in houston with more on this hi again, brian. >> reporter: hey, carl, good morning. playing a little zeppelin rock and roll there the market is rocking and rolling. so many effects from the attack, moments ago the u.s. telling saudi arabia they believe they came from iranian soil let's put size and scope into perspective. i know you talked about how big this outtake facility really is, and it is not completely analogous. here's a good example. we showed it earlier 5.7 million barrels off line, facility is 7 million total

barrels, 10 million all together there were two attacks so the two attacks outcake is what the market is focused on they hope to come online slowly the next couple of days. if you factored in five of the biggest refineries in the united states, top five refineries, it would be 2.8 million barrel capacity literally the top five refineries in america are only half what was taken off line with attacks on that outcake facility this is the single biggest supply shock in history there. you have that as well. listen, we don't rely much on saudi imports like we used to. we go back 20 years, we were importing 2 to 2.5 million barrels a day, much coming into houston every day. not the case any more as the oil boom has popped, and saudi arabia has mostly gone to china.

take 1.7 million barrels a day it is not nothing but it is not crippling. as the story evolves, because it is far from over, here are five big themes to focus on number one, you have oil prices on the rise. that's clear gas prices will likely rise. wholesale gasoline prices are up 10% now. if you're out there and some gas station dealer jacks up the price of gas by 50 cents or a dollar a gallon, that's gouging. no reason to see that. we will likely see effect on gasoline u.s. shale which is safe is all that more attractive stocks are up mostly because of short covering, but u.s. oil is looking fairly good as well. other angles, aram co ipo.

they were in abu dhabi discussing this when the attacks happened will that be delayed or shelved, this plays into effect there as well don't forget the china trade war aspect china is the biggestr of saudi oil. they tariffed our oil, our crude exports to china you wonder, they're going to need u.s. oil more after this, will they drop tariffs as some measure of goodwill, could this factor into this those are five big themes we follow today, tomorrow, all week worldwide team coverage. a lot of angles to focus on. right now it is huge jumps in stocks that everyone has been talking about sf. >> a lot to unpack there will oil factor into the fed's

decision tomorrow? joining us, chief investment strategist, and northwestern mutual strategist brent schuette brent, i'll start with you you have a jump in oil prices, brent and wti trading 11, 12%, not the extreme spike you might have seen in years past. i ask you the question, in terms of the u.s. market and in terms of the u.s. economy, this jump in prices, good or bad >> i think that's up for debate. the thing i would focus on are three cushions we have against it one, inflation typically this could cause it to move higher. right now we have room inflation is 1.4% overall. number two, you mention federal reserve. there's no way the fed is not going to ease rates at the meeting no matter what, central banks around the globe will live through this number three, the consumer has rebuilt their balance sheet and still are getting real wage increases over and above rate of

inflation. it won't factor through to consumers unless it lasts some time >> brian, do you agree with that >> we would, pbut i caution shor term inflation calls we waited 37 years for inflation, i don't think a one week event with respect to what's happening in saudi arabia in terms of oil patch will cause a great inflation. but the key them is 70% of the u.s. economy received a tax break in the last year with lower interest rates, continuing to be very strong. what maybe people are missing is the notion of dollar denominated asset. dda. that puts bonds in effect and stocks in effect i think this is going to be one of the situations where investors around the world migrate back to north america, not just the u.s., but canada as well people talk about the energy patch in the united states, well, canada is exquisitely positioned to take a play with respect to what's happening in

the global energy supply, especially considering the great companies in canada, how they manage the trading environment the stability of dollar denominated assets will be the theme we believe the next several months. >> it sounds like you're saying you expect the fed to read this as drag on growth, that's why you expect a cut even more than before what gives you confidence that that's the way this particular incident gets nterpreted, especially given the tepid reaction of the market today >> i think the ecb action on last week sealed the fed's deal, they have to cut rates because everybody else around the globe is doing so and our rates are so much higher. i think any central banks doesn't want to have impact on recession, will act with utmost ease, inflation is below 2% and they're trying to create it. the fed looks for this

one last thing i would say is dudly editorial makes them make the cut because otherwise it is viewed as politics. >> brian, what specifically do you like in terms of asset classes and in terms of stocks you see a move in the energy sector in the s&p, is that a buy right now? >> great question. i believe the move into energy might be a little too short term in the united states remember, there's a growth dominated performance aspect to portfolios working a long time saw nice move in value stocks the last week or so. much of that from a fundamental perspective is about free cash flow if you look for that, financials and technology gives you free cash flow. it is value versus growth and companies that focus on free cash flow and overall earning stability. energy in canada is much better position relative to energy in the united states, we are overweight, communication services, energy, and financials in canada and united states, overweight industrials, health

care, communication services and tech, and financials there's a lot of room to go with financials, with yields heading lower and fed cutting interest rates, think divot in growth in equity income is important for investors the next several months. >> thanks for joining us today turning back to oil prices, our next guest says higher prices will bring more supply to the market michelle caruso-cabrera is back. >> pleasure to be here >> price up is what some people wanted, right? >> sure. that helps u.s. producers for sure the cost per barrel in the united states is higher than saudi arabia the higher the price goes, more profitable it is in the united states and more supply comes to market to offset this spike that we've seen i'm old, carl, when i see the spike. >> jaded >> jaded for years, the fear was if

there's a terrorist attack in saudi arabia, oil could spike by $100 this is years ago. now because of what's happened with the fracking revolution in the united states, what happened in saudi arabia gives you a decent move, but it is not nearly as startling as it would have been. >> the percentage of household budgets that go to energy cut in half since the late '80s, early's '90s. >> the other thing, whenever cnbc shows the oil price, they show the front contract. i want oil delivered in one month. this is what i have to pay but there's a curve. you can buy in a contract for six months or a year from now, two years from now while the curve has moved up, it is not suggesting it thinks supply disruption will be so dramatic and problematic. >> is this yet another ding though we keep hearing uncertainty, uncertainty, uncertainty from ceos, from analysts.

this is another element, isn't it, not only what has happened but what might happen now that people have it in their minds that supply is at risk >> sure, especially because drones become smaller, cheaper, easier, more pervasive, even though the administration says it is more than drone attacks. absolutely but you're a ceo you have to deal with uncertainty all the time i think where it gets interesting is politically, heard rick perry say it this morning, secretary of energy, what is the reaction here in terms of national security policy when it comes to oil? do you trier to make sure the u.s. can produce as much as possible so we're not effected by this? i think you'll hear from the democrats that they think the united states needs to move toward things like solar, et cetera, to replace dependence on fossil fuels, but this will become a political topic as well. >> talking politics, one of the other groups trading higher,

aerospace, defense stocks, huntington, lockheed, because of the drone strikes and possibility that you have cruise missiles saudi arabia is the top buyer of u.s. weapons that's been another area of focus within congress. you've had lawmakers that wanted to block that because of the conflict in yemen. i wonder how it plays out in terms of demand for weapon systems and relation with saudi. >> not just what's happening with yemen but because of the murder >> yes >> i think human nature suggests we want our foreign policy to be about us supporting the good people, not supporting the bad people, right, but foreign policy choices are raring about those kind of obvious choices. choices are often between violators of human rights who are on our side and violators of human rights that are not on our

side, that are bent on destroying us and allies that's the unfortunate choice people in congress have to make whether or not to support the saudis do they have human rights issues you bet. but they're not trying to destroy us or israel or the region they have to make a tough foreign policy choice, which i'm glad i don't have to make. >> that's a tough call, the lesser of two evils. >> that's exactly what it is >> what do you say to people who are afraid we moved marginally closer to war? >> i think that's possible, i don't disagree with that at the same time, i get more and more a sense the president is not that passionate about going to war he's already restrained himself from attacking the iranians once you have to ask, did his refusal to attack beholden them to do this, and now do we get counter response because he thinks he was played so we'll see

he's hard to predict >> we know locked and loaded from the tweet >> lot of cross currents thankful for your guidance. >> always a pleasure and still to come. disney ceo bob iger resigning from apple's brdoa kara swisher's take next st powel 5g experience for america. that's why the nfl chose verizon. because they need the massive capacity of 5g with ultra wideband, so more screaming, streaming, posting fans... can experience 5g all at once. this is happening in 13 stadiums all across the country. now if verizon 5g can do this for the nfl... imagine what it can do for you. oh, wow. you two are going to have such a great trip. yeah, have fun! thanks to you, we will. aw, stop. this is why voya helps reach today's goals... ...all while helping you to and through retirement. um, you guys are just going for a week, right?

yeah! that's right. can you help with these? oh... um, we're more of the plan, invest and protect kind of help... sorry, little paws, so. but have fun! send a postcard! voya. helping you to and through retirement.

hey. you must be steven's phone. now you can know who's on your network and control who shouldn't be, only with xfinity xfi. simple. easy. awesome. with apple and disney streaming services about to

start, bob iger stepped down from apple's board >> reporter: jon, the depart ur is a sign they're at war they launched a subscription fee november 5st, $5 a month, ahead of disney plus launching november 12th for $7 a month two largest, most iconic companies in media technology may have different core businesses but now they're competing for subscribers and for deals with content creators. this is a departure after years of partnership apple for years sold and taken a cut of disney movies, tv shows, and subscriptions to espn plus and hulu soon they're selling it alongside its own subscription service. this convergence comes as tech giants turn to media to

differentiate services and lock in customers, media turns to tech to establish a direct relationship with their customers and reduce reliance on the larger tv bundle with a dwindling subscriber base. disney and apple new frenemy is echoed by a number of companies in tech and media space. at&t buying time warner to differentiate mobile service, facebook and twitter invested in different types of original content, and amazon is spending up for indy movies, big budget tv series, and rights to thursday night nfl games we're seeing the company boards reflect the new conflicts. we had the facebook ceo and twitter jack door see step down last year, and hayesings left facebook's board earlier this year back to you.

>> great perspective and setup let's bring in kara swisher, recode co-founder, "new york times" columnist and cnbc contributor. >> hi. >> ten years ago eric sm mitt resigned from apple's board, and that marked escalation of the smart phone, consumer cloud wars apple put out a lengthy statement because of android and chrome, we can't have him on the board, has to recuse himself from everything. >> yes. >> are costs worth it? this is a great partnership for apple and disney, they had launches together. that presumably suspect going to happen as much any more? >> not at all. it was inevitable move because of apple moving strongly in the sbar entertainment business and it has to. imagine board meetings bob iger would have to leave because these were in discussions, and not just entertainment is not

just one thing and another, it is all interrelated. you can't discuss the future of apple and hardware products without talking about software products and entertainment products so it is hard to have someone like bob iger in the room, hard for him to be there, he stepped down which was the right thing to do, as was the case with sheryl sandberg on the disney board, not so much jack door see as reed hastings, and eric schmidt when apple and android were clearly going to clash with phone systems. >> it looked for awhile like tim cook may have to step down from the nike board, nike decided not to do health and fitness devices to back away from that area. he is still on it. could it be apple or disney may be making a mistake, trying to expand out of the core >> no, these are direct clashes. this is cordial, they have a great relationship

i believe that lorraine has a large stake in disney, but fact of the matter is the companies are going to be competing, i don't think there's any acrimony, doesn't seem to be, it is right to do from conflict of interest view, board point of view no way to serve as a good board member bob iger is one of the really sharp executives around in media or even tech, he is very tech savvy. i think he probably understands very clearly he can't do his job at disney by being on the apple board and the apple board realizes he is not going to do that good a job given conflicts. it makes a lot of sense, so it is just not going to happen, that direct competitors should be on boards of each other >> kara, i know we talked about this a lot the past week, especially after the apple event, to revisit it one more time, what can we glean about news about how seriously apple is treating its streaming

service, fact that it is 4.99 price, and thinking about it short term and long term. >> they need more content. it starts with nine titles and disney has so much content the issue is how much are they willing to spend seems to me apple can't just rely on hardware going forward fact of the matter is think about what's happening with the music service, it is catching fire in a lot of ways. the question is can it do the same in entertainment, and it has to, which is something i talked about years ago, would apple buy a content company and would disney buy a tech company. these are the same businesses in a lot of ways. the question is can they do it creatively, create great shows or is it more happen hazard like amazon has done it they have to think about it for the future, no question. >> any evidence how to do this strategically, can you look at music and beats to decide

whether they can truly do it in-house or have to buy something large outside? >> i always thought that, we talked about that years ago. i think that the quality of executive is very high at apple, but fact of the matter is they don't have any expertise in this area, and they have been hiring, they hired some great people, but it is a big, getting into the entertainment business is not easy i always thought they should buy netflix, but that's just me saying that. there's nothing to it. years ago i think i said it. it just made a lot of sense to me but i think they definitely need to think about how to do this properly, and this is a group of people that's really good at hardware, less good as software, and very new to entertainment. we'll see, there are shows coming out with reese witherspoon, jennifer aniston, other shows, some of the early shows were not very good but it is going to be a learning experience for people of apple for sure >> we'll see how much they le d

learned from bob iger when he was on the board thank you. speaking of big media players, don't miss bob bakish tomorrow, 11:00 a.m. eastern. next, new name for the home of the rams and chargers how that deal came together next stay with us 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 by the way, she's the it wasnext mozart.g day. as usual we were behind schedule. but sophie's enthusiasm cannot be dampened.

not even by a run-away donut. we powered through it in our toyota prius. because a star's got to shine, no matter what. it's unbelievable what you can do in the prius. toyota let's go places.

liberty mutual customizes your car insurance, hmm. exactly. so you only pay for what you need. nice. but, uh... what's up with your... partner? not again. limu that's your reflection. only pay for what you need. ♪ liberty, liberty, liberty, liberty ♪

sofi striking a naming deal for the new home of the rams and chargers this is a big deal for this company. >> absolutely. none of this is cheap, carl, as you know so sofi is putting its name on the most expensive nfl stadium ever built project set to cost $5 billion, financed by the rams owner they wouldn't confirm how much was paid for the naming rights,

reported to be as much as 30 million in the next two decades. i spoke with the ceo anthony noto about the deal and the massive investment making sofi a household name >> yeah, i think first and for mo -- foremost, what brings the brapd to life and national telecast will drive name brand awareness, critical for a financial services company to build that level of trust. it is less than 5% of overall spending we have a strong and profitable lending business and $2.3 billion of cash on the balance sheet. not only is it important strategically, it is not that big relative to overall spend and critically, plept nty of capital to do this and many other things >> he said softbank gave the company 100% support to go

through the deal after a healthy debate. >> we had many conversations with the board of which softbank sits on. safe to say we had conversations collectively as a board and individually had 100% support from the board, they understood the importance of financial services brand having such trust and this was a unique opportunity to drive greater efficiency in marketing dollars, have such an elevated presence in the financial world and sports and live entertainment more broadly >> sofi will be home to both los angeles teams, the rams and chargers, is set to open at the start of the next season also of note, sofi stadium hosts the super bowl in 2022 and the ya olympics in 2028. >> i wonder if it is worth it. the compact center became hp pavilion how well did hp do, should they

have done something else with marketing dollars. is there talk about the value of this >> noto said i needed to see data and strategic value in this because the company is so young, if it were a public company, listed on new york stock exchange, you might say is it worth it sofi is young, 8 years old they're going to be doing this two decades, i think it puts them on the map, and it is a small portion of the marketing budget, 10%. >> just to go back to a conversation we had during the break, it is not very often you see stadiums come up for grabs like this. what is the competition like, was there any color on how he was able to cinch the deal >> he said there was a ton of competition, didn't name names you're right stadiums don't come up that often. this one is one of the biggest, hosting the super bowl, hosting the olympics, he did say there

was tough competition. he is also a former nfl executive. he mentioned roger goodell, he knows guys of the nfl. i think it is more about yeah, there are plenty of companies that can foot the bill, but this one is young, it is tech focused. they wanted through the sofi millennial brand to bring that in. >> his rolodex is unique in the sports world >> two nfl teams, different from the san jose sharks. great as they are. seema mody has a breakdown of today's action overseas >> let's look at how the impact of the saudi oil facility attack is playing out in europe the focus is on russia, whether they'll step in, increase production following the attack over the weekend that impacted 5% of the global oil supply. alexander novak, russia's energy minister said he was assessing the situation. remember, germany and france are

among ctop importers of saudi oil. in terms of stocks and reaction, weaker than expected economic data weighing on shares with industrials and tech, with airbus down 3.3% and then you ever oil explorers and producers getting a big boost this morning, more regional players, tool and london oil, and bp, you can see all rallying the other side of the story, transports, particularly airlines like ryan air and air france, down about 1 to 3.5% in today's trade. one of the bigger questions is how central banks will respond remember, in addition to the fed we had bank of england, japan, brazil, norway, switzerland among others meeting this week that will certainly be a big topic that's likely to come up morgan, back to you. >> certainly is. we're seeing the same down side move in transports here as well.

thank you. let's go to sue herera for a news update. >> good morning, morgan. good morning, everyone united auto workers and general motors resumed talks aiming at ending the strike that began at midnight first strike since 2007. 49,000 workers walked off the job, calling for better pay, health care, and profit sharing. hurricane humberto expected to dump more rain on the bahamas as it moves away from the u.s. coast. they say it will bring life-threatening waves and tides to central florida and north carolina coasts. a small plane carrying local government officials crashed in the southern part of colombia, killing 7 of 9 on board. the cause is yet to be reported. nine time nascar champion mike stefanik killed sunday.

it took off from rhode island. they say he was the pilot of the plane, was turning back to the airfield when it crashed in a wooded area. you're up to date. that's the news update this hour, carl back downtown to you >> sue, thank you very much. we watch oil prices in the wake of the attacks in saudi arabia we'll get the view from the oval fin a moment back in two.

we have heard from president trump on twitter and energy secretary rick perry here on cnbc on the saudi refinery attacks. eamon javers joins us with more on the reaction inside the white house. eamon? >> reporter: jon, the president is chairing a national security meeting with top officials, focused on the question of iran. we have an interesting situation at the white house you've got the energy secretary, rick perry, and secretary of state, mike pompeo, out there saying that they believe the attack was conducted by iran but the president himself very careful in public statements not to make that specific attribution. here is rick perry in a speech to national atomic energy agency earlier today, making that allegation, which he also made on cnbc air earlier this morning. take a listen. >> i want to reiterate that the united states wholeheartedly

condemns iran's attack on the kingdom of saudi arabia. and we call on other nations to do the same. this behavior is unacceptable. it is unacceptable and they must be held responsible. >> reporter: contrast that direct attribution to iran with the president's tweet from earlier this morning he says remember when iran shot down a drone saying knowingly it was in their air space when it was nowhere close. they stuck strongly to the story knowing it was a big lie now they say they have nothing to do with the attack on saudi arabia we'll see. question mark. they're not going as far as his own secretary of state and secretary of energy have gone attributing this to the iranians i asked white house officials about the discrepancy, they say they're aware of it, but not offering any explanation why the president seems to be taking a different line than cabinet

members in terms of who conducted the attack we may get more information later today now that the national security meeting has been conducted by the president, might have more white house officials explaining who the united states thinks undertook the attack, what the u.s. response might be, guys. >> looking for that additional information and to see what details it provides. meantime, another tweet on the heels of the attacks, eamon, he talked about being locked and loaded, depending on verification any insight what that could mean, locked and loaded? >> reporter: the immediate assumption is that refers to military retaliation, we have the vice president's chief of staff talking today to reporters, suggesting no, that didn't necessarily mean that, might mean economic response by having the u.s. tap into the strategic petroleum reserve, that's what locked and loaded could be referring to. so an unusual interpretation of

the phrase locked and loaded that people figure has a military context some white house officials saying maybe not so. you could be looking at a situation where officials here don't want to be provoked into a situation where the united states has to take military action in iran remember in june the president came very close to a strike on iran in response to iranian attacks on tankers in the persian gulf, and then backed off the attack saying he didn't want a high body count on the iranian side it may be we're seeing from the outside some glimpses of debate similar to that going on inside the white house. don't know the answer to that right now. >> to your point, eamon, wasn't just secretary perry's speech in vienna, had him on "squawk on the street." here's what he told us. >> i think the president was spot on when he said that would be available if needed i think we're premature on

actions, about whether it is needed until we get a handle on length of time that the facility is going to be down >> so there's a difference in what they're saying, cabinet members are saying regarding the responsible party, namely iran, and also spr, whether this is tapped perry was circumspect. >> he was. the u.s. could be ready to draw on reserves, was not basically giving the green light to do that just yet. worth noting in terms of additional information we have been getting out of the government around the attacks and why certain members would be pointing to iran, that data comes from satellite images from commercial space startup, planet labs, it is micro satellites, provides images, works for the

u.s. government. another case you see space continue to contribute to national security and some of the new technologies that the government is leaning on coming up, exclusive peek into new york's tallest building robert frank has that. >> reporter: good morning, carl. we're looking down on the empire state building from the 123rd floor of central park tower, which as of tomorrow will be the most expensive, tallest residential tower in the world will it sell in a tough market we'll gi y tveouhe numbers and amazing views after the break. this is his family, the world he's built, for 72 years. ♪ this is hal's heart. it's been torn. broken.

and put back together. this is also hal's heart. this is the cardiologist his brother recommended. and this is hal's relief, knowing he's covered. this is hal. his heart and memory keeper, and it's beating better than ever. this is what medicare from blue cross blue shield does for hal. and with easy access to quality healthcare, imagine what we can do for you. this is medicare that cares back. this is the benefit of blue.

here's what's coming up top of the hour. debating the future of the rally, oil prices are surging, stocks are riding a winning streak what happens next. and big name bank downgraded, a favorite on our desk we discuss what it means to your money. and two new stocks will be revealed for you when we see you on the half at noon. about 15 away, see you then. >> sounds good let's get the santelli exchange from rick >> hi, carl. bleakly advise or group, welcome, peter a lot of things, curve balls this morning, you see what's going on with regard to energy markets, based on the saudi situation. your take with respect exclusively to how it may or may

not impact our meeting on the 18th, bank of england, japan, switzerland on thursday the 19th. >> the irony is on one hand, central bankers want higher inflation, the iranians give the central bankers what they wanted in higher oil prices, which could translate into broader inflation. that said, oil has been trading in 50 to 65 dollar range all year until it breaks out above that, to me at least the price action is somewhat noise even though the news to me is really important, and the inflation break evens which central bankers particularly fed pay attention to is highly correlated to the price of oil i think for now, transitory talk with respect to oil, and we'll be focused more on the core. if oil prices stay sustained at higher levels, on one hand that's what central bankers want, but last thing the bond market wants >> yeah, and the bond market

seems to be king i watched the break evens, i know you do, ten year break even rate tip versus coupons is 167, unchanged from friday. at a level we haven't seen since august 1st the problem is, i hope central bankers are listening to us now, we're also with the highest yields of ten year note yield since the 31st that's why i moderately watch the break evens, for years, it is ten year note yields we're watching and they have been more effected by trade than anything i have seen on pricing. your thought >> 100%. the inflation side is much less of a factor, to throw on top of the more influential factors, what the ecb, doj have done with long term interest rates, spill over fact and suppression on our bond market. unless oil prices stay sustained at a much higher level and that starts to spill over to broader

prices, i think it will be put to the side and compartmentalized. that said, we have service inflation in the u.s., goods prices beginning to tick up, whether it is tariff or not, we'll have to see. oil on top of that, central banks may get what they want, but i don't think the market is looking forward to any slight up tick inflation >> excellent thank you. also remember, 8 days up in the dow, 8 days higher yield, looks like they obviously have gotten along well together. morgan, back to you. >> rick santelli, thank you. still to come, a real estate company not named wework ceo of compass joins us on the latest funding round, whether they have ideas of ipo of their own. dow down 149 liberty mutual customizes your car insurance,

so you only pay for what you need. i wish i could shake your hand. granted. only pay for what you need. ♪ liberty. liberty. liberty. liberty. ♪

to the wait did frowe just win-ners. prouders everyone uses their phone differently. that's why xfinity mobile let's you design your own data. now you can share it between lines. mix with unlimited, and switch it up at anytime so you only pay for what you need. it's a different kind of wireless network designed to save you money. save up to $400 a year on your wireless bill. plus get $250 back when you buy

a new samsung note. click, call or visit a store today. we have been in a range all morning long, but we are closing to the bottom of it. s&p 2993. squawk alley is back in three minutes.

it is thetallest building in new york city and the tallest condo tower in the western hemisphere. an exclusive look at the new central park supertower. >> it is an oversupply in the sky. starting tomorrow this building will become the tallest residential tower in the world. yes, you actually look down on the empire state building. it is also one of the most

expensive condo projects ever with $4 billion worth of condos that they will have to sell. this is one of the weakest luxury real estate markets that we have seen here in new york since the financial crisis. there will be 179 priced around 6,000 to 7,000 per square foot. the developer says he is confident even in this market that this building will sell. >> overall, we are cautiously optimistic that we will continue to sell and sell enough and get through the down turn. it's not really demand. >> it is supply. if you look over my shoulder, we have two of the big new towers going up here and then more on the way. now, one in four condos recently built in new york, one in four of them remains empty. thisbuilding in addition to th condos has a seven story nordstrum store.

this apartment is priced around $70 million. so with prices like that and a market with so much supply, the question is whether and how much they will have to discount to get these apartments sold. guys, back to you. >> i wonder at that height if the building sways. so many questions. thanks for giving us a look inside. real estate tech company announcing a $370 million funding round. is it a reason to be bullish in the industry could an ipo be in the company's future. you're joining us today because you are announcing some new features for users of compass including ai. tell us about it. >> we are building a platform to power all real estate decisions for advisers, sellers and buyers. sellers come to sell their home for more money and less time. buyers come to buy. we launched a new consumer site

that lets agents collaborate. it has features like ai-driven recommendations based off of everything that they are serving. it has collections which is a visual work place which allows the agent and client to collaborate, discuss and monitor the market in real time. >> there is a lot of competition out here, a lot of talk and has been talk about the idea of disruption to real estate. certainly in particularly in focus with the wework company. how are you different than competition and what are you bringing to the market in terms of disruption? >> there are technology companies that focus on agents and not the consumer. we are unique in that we are focussing on both and really allowing them to collaborate together. what makes us a technology company is we have scale effects, network effects,

defensible ip, technology. our core is an inventory-base where we hire agents which bring inventory with a new site, brings more traffic for agents. then we build tools for our sellers to sell homes for more money, less time and allows them to bring more. >> you have a nice valuation. you raised more than a billion. are you going to stay private too long >> an ipo is likely in our future, but i don't go to sleep tonight thinking about an ipo. i think about how to help agents grow their business. >> how close are you watching the we ipo given the fact that real estate is in focus with it? >> i look tat to take lessons from them. real estate is a very large segment of the dploebl economy. i think it's the largest. we are not a landlord. we are a very different type of

business. >> how do you characterize the new york market right now? >> there is excess inventory. with low interest rates, never a low interest rate environment that has not been good for real estate whether the mansion tax, transfer tax, the challenge is the perception of taxes. when there is a perception that taxes are going to increase, that's not good for real estate. >> your take on housing across the country more broadly >> markets where there is a lot of software companies doing great, seattle, san francisco, austin, nashville. any market, there are buying opportunities. you just have to find the right agent to help you identify those. >> thank you for joining us today. >> it's been quite the morning as we have been watching. obviously the oil story, the

strike of gm, china data we got overnight, not good across the board whether ip, weakest in 17 years. the cap x sentiment pretty bearish. we have been holding on here, not too far away from 3 k. and the fed on wednesday, let's get to the judge. >> carl, thanks. front and center this hour, the future of the rally. stocks sit just below a new record high. is this the week to propel your money even higher? it is 12 noon, and this is the halftime report. a new shock to the markets and a fed rate decision this week. will the bulls keep charging and how should you position your portfolio from here? will value take the lead jp morgan getting downgraded, the stock up over 20% this year. is the run done? it's our call of the day. the investment committee is ready to go.

halftime repar