>> announcer: live from new york where business never sleeps, this is "squawk box. >> good morning. welcome to "squawk box" here on cnbc we are live from the nasdaq marketsite on times square let's look at the u.s. equity futures. you'll see the dow, nasdaq and s&p all weaker today yesterday, s&p closed at a record high for the first time since july 26. you saw the big run. nasdaq took a shot at a new record didn't get there. dow only 1.1% of its record high the fed meeting tomorrow, so lots of market speculation around that. we'll see what happens again, red arrows this morning in asia, nikkei up about half a

percentage point hang canning down and shanghai off by about .9% active trading in europe now you'll see red arrows across the board. biggest decliner is the ftse 100. look at what's been happening in the treasury the 10-year is yielding is 1.824% zben well above 1.8% >> talk about pg&e, saying its power lines may have started two wildfires over the weekend in the bay area the fires began in a section of town where the utility opted to keep the lights on another round of blackouts is expected to begin today as more strong winds move on shore

the u.s. is considering extending tariffs. skapgss on nearly 1,000 products in september, they plan to exclude american farm goods. >> bowings ceo said that their company made mistakes and got some things wrong. we own that and are fixing that. saying boeing employees felt pressured during the certification process. that hearing begins at 10:00 a.m. eastern we'll watch closely and talk to two senators who will be questioning mullenburg >> let's talk shares of google

alphabet are lower earnings came in well below the 12.42 analysts had been expecting. they did report ad sales but profits did file up. it vests in businesses such as consumer electronics and the cloud. the report that they were asked if they were buying fitbit still questions about the cost i think the advertising issue is the biggie >> check out shares of beyond meat they were getting slammed in the activity reporting its first profit of the company. beyond meat is facing increasing competition from rivals like impossible burger even as it signs new deals with subway and

mcdonalds. topping out near $240. down about 9.5 if you are looking at a longer term run, this has been a pretty phenomenal story the ceo will join us around 8:00 a.m. eastern today is the day the lock up expires. >> coming up, we'll get you ready for another busy morning on wall street as the s&p starts in a place where its never been before >> to infinity and beyond. >> we have reports of pfizer and america. we'll talk strategy. as we head to break, the look at

the biggest winners and losers especially with the dow. we'll be right back. at synchrony, we're changing what's possible every single day. and if you run a business, that means a lot. we create financing options for your customers. to help them get the things they love instantly. our data provides insights into what your shoppers have already bought. so you can offer them what they might consider buying next. our technology and financial solutions are changing what's possible in all sorts of ways. so, how can we change what's possible for you?

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closing at a record level ahead of the fed policy meeting happening today. expecting another rate cut joining us, head of municipal bond investment group. and ed campbell, senior portfolio manager. you are bullish now. there might be a melt up at the end of the year. we hit a new high. thanks for that. you think they might be in a rally mode the geopolitical risks have been dark clouds on the horizon

trade situation, at least the conversation seems to be moving in the right direction we've gotten through the difficult months of september and october without the typical blow ups >> when you say the year end rally, we haven't seen it yet. we are through december and october. you are talking november and december, besides the move, 7 to 10%. >> that is a definitive some people don't date it back 18 months i feel like we've been kind of flat we've had a big run up since there. it feels like it has been a

fantastic year a recovery from the big dive we've seen in the fourth quarter. >> i've seen people making that point that the markets are ahead of themself. if the market anticipates a flat earning year and tread water from january to now. rates have come down and we've kind of spring loaded everything maybe seen other things bottoming as well. we may have spent enough time bottoming out. the big thing may be the down turn in manufacturing. we have a lot of still lmulus wh rate cuts. i'm not wildly bullish

the economy has a lot of issues and problems investors can put away those concerns now and year end. we could have a pretty decent up move >> fixed income. if we are facing a slow down, you have to think about the credit risk. feel good on both counts or are you a little bit sticking your toe in the water >> up each about 6.5%. yields have come down. economy continues to expand. that's a nice mix. they are able to refinance that. even issuing taxable bonds higher bonds, old tax debt that has been benefitted by the economy's long-term expansion.

equity market has been on a huge bull run that helps with trouble so many situation there. the muni credit situation has been strong. >> what can we expect from the fed, any surprises >> i don't think it would be a surprising meeting, how does the fed couch what they have done now that we'll get another ease. it may be the midcycle adjustment we are called that they sort of panned when you consider the economy has been decelerated, the believe al economy has been decelerated and we have a truce in face one. completing again, sees how the risk factors are identified.

global de-celebration, evolve from here. if that's what they say. they don't promise another ease, i think it is possible they take this in stride if they say we are done, that could be a challenge that could be a bit of a surprise they are remaining proactive to the risk on the down side. >> what is the growth, is it going to be 1.5 to 2.5 now >> pinned to 1.75.

i still think we are in a 1.5 to 2% range the fed had to do their adjust asking now, does the economy truly get acceleration or a soft landing. if we are getting a soft ladder, 1 dat 5 to 23 seems to be the trade. >> what happens next year? we get a year end rally and then election >> yes i think it is too early to start obsessing about the election especially since where he don't know who the candidate will be

on the democratic side >> some say we don't know on either side, is that possible? >> not yet >> here hoping >> the flattish is explained by the tough tax cut. if we avoid a recession, earnings will get back on track for midsingle digits we could have another decent year >> can you send any wine, r.j., not you? >> no relation not in the wine business in the bond business >> i guess i'd rather have bonds sent to me than wine >> i'd rather drink wine >> we may need some next year. when we return, bernie

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the next presidential election many topics are hitting close to home bernie sanders talking to cnbc's john harwood about the power and practices of ceos. >> you can judge a person by the friends they have. you can judge a candidate for president by the enemies they have i uniquely in all due respect to my colleagues, i am taking on insurance companies, drug companies, fossil fuel industry, the military industrial complex, prison industrial complex, wall street >> more from senator sanders you, go to cnbc.com to see the full interview more on the content wars battle the they had been writing and

producing new star wars series but they won't be able to continue because of the new $200 million project for netflix after saying that fet flichl deal had been controversial. ale they were looking back >> i think the confederate deal went fast. >> the star wars deal, they hadn't started writing or anything you guys are more "game of thrown" fans, there was more about the ending

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welcome back you are watching "squawk box" from the nasdaq marketsite in times square >> good morning. take a look at u.s. equity futures at this hour

we are already in record territory. the dow looks like it would open down s&p looks like it would open down about 4 points and the nasdaq about 20 points off this story is for joe, maybe for everybody. apple has introduced a new high-end version which i think will fit joe's ears better air pods prowill feature new design and noise cancellation. they'll cost $249. >> that's the important component. >> they are available to order now and ship by october 30 here is the deal noisecancellation is the big feature. for you, they come with different sized rubber tips. they need to create a sale in

order to work. it is more of a squat little case a wider case a little narrower. >> they are a little uglier in some ways. >> my solution has been to reverse one. the left one in the right ear and they say it's very tenuous. you can have continuous air pod fear when you walk in here, that grate. people who walk in here in heels. there is a guy they found who fell in a manhole. they found him like a month

later. if those fall off when you are walking over a grate, they are gone >> i want these for a different reason my problem is right now, i wear these all day during the show. then when i get on an airplane, i still carry the bose noise canceling buds if i could put these on the airplane, it could help. >> if you are a road warrior we have a lot watching here. they are in hotel rooms and running all over the place who wants to carry two sets of head phones. that's the sale. >> so you are in >> you have bose, not beats. >> look, beats is owned by apple. if you actually care about true

noise cancellation with apologize to the lovely people at beats, bose wins the game >> is it bose or beats >> bose are the ones that really work i have a pair too. those are the ones that really work >> there is no way to respond to you. >> no. there is not >> it is just high school. >> yes there is. shut up. shut up and read >> shut up, fatty. >> read. >> i don't even have to say it >> grubhub we go right to that. sliding more than 30%. giving disappointing results and weak out look. blaming premiscous diners those

who use multiple apps. restaurants have been pushing back on fees charged by delivery services i may get taco bell. bp says its net profit fell more than 40% $2.3 billion profit sounds good but down from $2.8 billion >> former founder of kickstarter joins us to talk entrepreneurship and later, our first cnbc interview with beyond meat ceo ethan brown that stock still down sharply this morning today is the day of the expiration of the lock up.

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>> welcome back.

u.s. equity futures are a little down after the s&p hit a high yesterday. on the dow, about 34 points. s&p about five take a quick look at crude crude hasn't been the most exciting thing to watch. it has been in a range no one is complaining. down in the midtwos. $2.50 for gas. >> below where we were a year ago. >> breaking overnight, wall street journal reporting that marathon petrol yum is considering selling off its gas station shares this one is fluid according to the report as the company prepares to release earnings in two days it may still end up reversing

course also new, saudi aramco i aiming to set the price range for its ipo on november 17 with a final price announced december 4, it will begin trading on december 11 according to the kingdom's state-owned tv service. they've delayed the deal to give investors time this has been delayed multiple times. i don't think we've ever gotten to the place where they've released dates hot by anticipated not as much as they want it to be given that the price valuation is not where they want it to be there is a view that they are trying to not have a very low price but to set a price so that in 9 future they'll be up. >> the real story is the money

tiktok has reports of looking at going public weighing an offer in hong kong as early as first quarter next year should tell you, even though tiktok is kind he's site that is true a bunch of other u.s. venture firms have stakes in that company. >> ipos have started and ran a company that decided to stay private. the former ceo of the kickstarter. author of a new book called this could be our future. >> thank you for being here. before we dive into the book, i want to get a little backstory you were somebody who preached this and lived this for years about not maximizing profit or

taking every time. explain that kickstarter became a public benefit corporation in 2015 which requires us to legally balance producing to share holders versus a positive benefit that came naturally to us part of why people love kickstarter. this is a platform that a peefs to creative people and artists we've always had a strong belief that the long term success of the company relies on a strong tie to the community and the larger values. it has already hpenned elsewhere. kickstarter, you find a way to find seed money. >> yes someone posts an idea of something they want to make, the

public posts the money there is no final upside successful starters are pel oton occulous rift. >> to me, i never thought of it as a true investment if i had put money up for pel e peloton, i might have gotten a bike out of it but not what other investors are getting. >> when peloton put up for early investors, it was a very early idea kickstarter is a way for people to interact directly with the

public there is no financial upside it is look at the restaurant, my name is on the door. >> what is the story of the union? >> the kickstarter union >> why push back on unionization >> i haven't been involved in the company the last two years >> what do you think is going on it doesn't look good >> i would hope there would be a vote they've just been saying it would have a vote. i think the idea is to put it to employees to make the decision i'm not clear why that would happen or what it would take as a cofounder or owner of the company, i would like them to move on today. >> anything i push back on, a lot of the ills of society you

tie to the profit incentive. you've tried other things. it seems like if a company is profitable, employees keep their jobs, they keep paying taxes if someone becomes wealthy by being an entrepreneur, he becomes a figiving if you are losing money, you are really doing well. that seems like the converse >> i don't disagree at all the focus of growing capital bays has been the dream. but it is time to change dreams. >> and try to make less profits? >> try to grow value in multiple

ways instead of just one >> isn't profit the engine of what you want to do. >> possibly. there are limits to these things taxes will go down that's not what happened before. >> we want to redistribute opportunity. do we want to redistribute income >> no. i think that is the first deal national value but i think that is the last one. figuring out what are the next value. the crisis, the fact that we are trying to change the amount of carbon in the atmosphere, we need to be working on that language >> is there a historical

precedent for making this model that you can point to that has been more impressive sure pan sonic. >> no. a country that has become less capitalistic >> sure. if you look at europe, you have a mix of saying we are not asking for someone conversion fees are high >> we can choose it is an alternative but over the last 40 years. people are probably 40% to 50% less healthy per year. the idea that the expansion

would cure all we had the record scratch at the moment >> all the people that are supposedly woke were the most unwoke are you saying they should have taken a stronger stand for human rights in china? >> yes >> we thought this was the most woke league. once it ran counter to what you are trying to push back on, then the rubber met the road. >> it is a new kind of friction. the first moment we are feeling that the first pangs you are figuring out the response

>> i you are writing the book. even adam silver saying, we we koof rate as of free speech. the line they are trying to hold without pissing anyone off when i think about the need for american companies to promote in china. if that was a new concern just as it was in the cold war. i think we'll have that idea come back again. if i look at the 1950s and 60s, what was happening capitalism was forced to compete with communism which score board can produce the biggest middle class

>> what do you make of the argument by our treasury secretary. the reason they often argue they wouldn't sign it isn't because businesses aren't doing things, they often are they would say, look, it is too hard to serve so many masters. if you give me one target, i can do that. i can probably do all these other things to get there. but if you give me five, i don't know how to value or guj what i'm doing. >> right it is not everybody's job to work on every single thing i feel like the notion of expansion of responsibility for

businesses smart companies know that's how you lead in the market, being the first to stake out that ground i think that will keep happening. >> you've walked the walk with this back in 2015 when you talked away people were looking at a $520 million plus valuation walking away from that and now watching what is happening at kickstarter, is there ever a time they'll go public we really want the service to be what it would be trying to be what best serves the products i don't think that's the best way to do that i think it is less dogmatic.

a place like kickstarter is important. just to slo have a shot. that space needs to be reserved. >> good luck with the book earnings came in at $1.51 a share, above what was expected at $1.24 in large part because of the beat they just had they are looking for earnings to be between $5.12 and $5.17 the street was at 4.92 considering the 27 cents they just beat by so really just acknowledging >> pfizer also reported that pfizer stock is indicated up

about 4% on the latest report here i'm torn because the profits are good and i don't know how to feel about that. >> too good? >> i don't know where to draw the line when these are too high and become a debtment. but 75 cents was above the estimate revenue at this point, breaking it out -- is that the actual net profit, don't have it in -- we have all the different, upshot interyou view. we had seen adjustments.

they have now raised that to $2.94 to $3 now indicated $2.94 to $3. couldn't they use some of these to cure some horrible illnesses? isn't that possible. jo or spend it on advertising. >> right probably better if they are up >> what do you think >> i don't want people gouging i also the european model -- >> balance, my friend. >> it is but it's also -- you've got to figure out the balance. >> signaling is great in principal but it doesn't work in the real world a lot of times. you just need to keep our heads on straight here we have 70% of the millennials ready to elect a socialist, then we've done something wrong in the last 30 years. >> we continue. >> we continue that debate

dow components, much more on those moves. we'll dig through google's report 'lbeig bk. at synchrony, we're changing what's possible every single day. but what does "changing what's possible" mean anyway? ♪ well... if you run a business, it means a lot. for starters, we provide you with financing options for your customers. that way, you can help them buy the things they love instantly and pay over time. and that turns them into serious fans. hang on, there's more. want customer insights? we've got those, too. we use data to show you what your shoppers have already bought so we can tell you what they might consider buying next. and you can offer them the perfect products. that ceo gets it. from adding unique capabilities to your company's apps to bringing you loyalty programs, our technology and financial solutions

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welcome back to "squawk. google reported numbers last night. still down pre-market. joining us to talk about it is eric sherridan from ubs. mike santoli joins us this morning as well. you looked at this report. you thought what >> it needed a little bit of work to understand some of the below the line items >> i kept calling it noisy. >> it was noisy.

there was a $550 million penalty to french tax authorities. there was a mark to market on all the public and private investments google has in companies like uber and lift we stripped all of this out. and it was a very good earnings quarter with the company buying back $6 billion worth of stock in the quarter, which was a big surprise. >> you're bullish on the stock >> i am. >> you don't look at this as a miss at all? >> there was no miss on site's revenue, on cloud and search they beat and spoke very positively on cloud trends. >> do you think investors are really going to x, x, x, x, x and say, oh, i like it >> it seems it keep in mind alphabet shares were pretty close to their highs as opposed to the other faang stocks i do think people were looking for a good number. it's a similar story the core businesses look great growing at 20% at this scale is kind of amazing. i think there's a little bit of ambivalence all the time with

investors saying i wish they would harvest more have more roi attitude about what they're investing in. on the other hand, the core business is great and you have exposure to massively growing areas whether it's internet tv through youtube or cloud. >> give me the up side and down side >> i think it's closer to 1500, 1600 per share. >> in the next 12 months. >> 12 to 15 months it moved to 1460 overnight against a free cash flow this throws off i think your down side is around 1000, 1100. revenue surprisingly decelerated. that was the big miss that caused the big selloff in the stock literally this year. you've seen two quarters of accelerating revenue that's what people liked last night. >> eric and mike, thank you guys, appreciate it. coming up, it is a big week. another one for earnings the fed, boeing and much more,

we're going to have you covered on all the big stories after the s&p closed, the momentum can it keep up today? not so much. we'll be right back.

earnings and the fed what investors need to be watching ahead of the open straight ahead utility stocks under pressure as wildfires rage across california. a closer look at the impact on the sector and to customers coming up. and boeing ceo dennis

muilenburg heads to washington to face questions about the company's 737 max airliner we'll speak to senator roger whicker ahead of the hearing as the second hour of "squawk box" begins right now live from the beating heart of business, new york. this is "squawk box. good morning and welcome back to "squawk box" here on cnbc live from the nasdaq market site in time square along with becky quick and andrew ross sorkin u.s. equity futures down 22 at this moment. nasdaq indicated down 16.5 and the s&p is off 3 from all-time highs. in our headlines right now, two major pharmaceutical companies reporting better than expected earnings this morning first up muerck raising its ful

year's earnings forecast you can see the dow component is up by 1.7% rival drug company and fellow dow component pfizer earned 75 cents a share for the quarter. that was 13 cents better than expected the 2019 research and development expenses will be less than it had originally forecast the stock right now up by 3 1/4 percent. boeing ceo dennis muilenburg is going to be testifying before a senate panel on the 747. he will tell lawmakers that the jet maker made mistakes and it will take steps to ensure that accidents like this never happen again. you can expect a lot of focus on this, a lot of focus in washington and on wall street. we have more on the story coming up later in the hour. today is the day, day one of the fed meeting kicking off.

steve liesman joins us. >> there's pretty good certainty on what's going to happen today and tomorrow after that is where opinions really diverge about the outlook for monetary policy. take a look at our fed-spectations chart. 79% expect a cut to be announced tomorrow pretty good. we've been at 100 a lot of times. not this one 79%. the next cut though, the average date february 2020 only 37% expect a december cut, which means that more than 50% are building in a pause for next -- for the next meeting and then the median funds rate going through 2020, the median is 1.4%. that means that they're expecting one more cut and a little bit over the course of the next, say, 13 or 14 months let's move on. let's look at the divisions over what they think the fed should really do. 44% think the fed should hold. add the two together and you get 54% think the fed should cut

so there's a good amount of kind of disagreement over what ought to happen here now let's look further down the road here. 40% think the fed won't cut again after this rate cut in october. 60% say they will. then we divided that again 30% see one cut and 30% see more than one one other thing, why is the fed cutting? 31% say it will add up to 100, supposed to anyway weak economy, low inflation and the trade war are the three big reasons. the yield curve market pressure and this group does not believe that the fed and powell are responding to presidential pressure 3% say that's the reason for the cut. we have all these online, all the results including grading the current democratic and republican candidates for president. >> do you want to give us a little hint on that front? >> generally a pox on everyone's house but much more a pox on the

democrat's house one through 10, 5 is neutral, president trump gets 5.5 the next closest democrat, 4.7, joe biden. >> then? >> well, i don't have them all in front of me, but i do know that sanders is a 2. >> okay. >> and warren's 2.5. >> 2.5. >> which is believed to be very negative >> i guess farwood sat down with bernie >> yeah. >> anybody who has been successful and generated any prosperity whatsoever is an enemy -- is one of bernie's enemies and he's very proud of that to me it was surreal just watching it. i don't know that's the kind of guy that honeymoons in moscow no offense you went over there on business, right? >> i became a capitalist as i often say. >> you did

see, he didn't >> but here's the thing. it's amazing that in my opinion the democratic party completely cedes the issue of economic growth to the republicans. they have -- they don't even use the phrase economic growth they don't generally use the phrase private sector. >> it's become a complete anti -- >> i don't get that because it's not like -- there are a bunch of programs that in my opinion, joe, that are socialism that would be good for capitalism. >> where's mayor pete on all of this. >> i think he's thought to be more centrist. >> although he's not that centrist. >> i have a rule the number of candidates has to be under double digits for me to really dive into their economic proposals. >> going to have to wait a while. >> you can't do it >> by the way, next we have robert frank -- i should tell you, 80% hate the wealth tax for a whole bunch of reasons. >> one of robert's houses got sold, one out in l.a. >> does he have a commission on

that >> it was a $250 million house sold for 90. i mean, like a steal. >> the numbers are made up like ipo numbers are made up. >> steve, thank you. i want to talk more about the democratic party in a second for a closer look at the economy, fed and more, i want to welcome in kathy jones from schwab center for financial interest we also have a chief strategist here let's start in terms of what the fed is going to do, not what they should do, and what you think the market already expects. >> yeah, i think the market's in line with the consensus that they'll cut this week and they'll try to go on pause. >> they'll try to go on pause. hold on. if they say they're going to go on pause, you think the market's going to be okay with that i'm not in the same camp with you. >> no, i'm not saying the market's going to like it, but i think the consensus among

economists and strategists is that i'm not sure that the market is in position for that so what i -- >> meaning the market is not positioned for them to say they're going on hold? >> right i think the market's expecting them to be ambiguous about their future plans which i think powell will try to be but anything that doesn't indicate another cut coming right away will probably be a disappointment to the market. >> where do you stand? >> we think -- our clients expect the fed will cut rates at least once between now and the end of the year. they don't like to intervene in election years election years tend to be -- >> once between now and the end of the year. this week? >> oh, yeah, this week i think maybe one more and -- because, again, the fed doesn't typically intervene in election years. election years tend to be volatile this one will be more volatile than most. i think they want to do what they can now between the end of the year to make sure we're in a good, safe position that will get us through the end of the next trend.

>> i want to point out our survey is not that much different than where the market is priced, which is for a 90% chance of a rate cut tomorrow, 18% chance of a rate cut in december now what the fed funds future said and what happens once the market hear that confirmed can be a huge gulf. >> yes. >> we're priced for a pause and powell says pause and the market freaks out because you don't know where the marginal money is. >> what i mean for the market not being priced correctly is when i look at the treasury yield curve, the five year is expensive if the fed is not cutting more so you don't have the slope of the curve pricing in the fed going on pause. >> throw this out. quick question did you read this today. fed rate cuts don't pack punch they once did. this is the heard on the street column not exactly the newest idea in the world, but the question is at this point in the ball game and this point in the cycle is this actually a wasted effort?

>> i'll say very quickly before it gets answered that our survey is full of people that do not believe in the efficacy of these rate cuts. i want to quote one individual here who says after the next cut the fed funds rate would re-enter the zone where there's no evidence that further cuts help the economy if they're such a panacea, why aren't japan and germany growing at 6%? >> anybody want to take that on? >> yeah. >> paulsen says it takes a while over in europe and we're starting to see the benefits. >> jim paulsen >> jim paulsen says there's a lag effect and it still does work in his view the s&p kind of said that. >> we're seeing a little bit of benefit in the housing market from the rate cuts but no one is saying that the cost of capital is too high or that credit is not available. >> they're saying the dollar's too high. >> yeah, but cutting rates isn't going to help any because the dollar has stayed firm even though the fed has been cutting rates because policy is ultra easy elsewhere.

>> on the headline, i look at it conversely if the fed does not cut rates i think the market would react probably negatively. so i think that there's -- >> the fed does not cut the market will have complete -- >> and, by the way, can i just say if they don't cut this time thinking they're going to cut next time it's wasted. >> you're absolutely right. >> you look like you get pressured into cutting later. >> the way the fed looks at that is what the fed wants to do is ease financial conditions. when it upsets the market and the market sells off, that tightens financial -- >> they're going to cut once in the next two weeks cut now and warn everybody you're not cutting until later. >> what do you want them to do, becky? >> i don't know. you know, rates are so low at these levels. >> spent years keeping -- trying to keep asset values high based on low interest rates trying to engender the wealth effect some people would say there's something to it. self-fulfilling. >> let me lay out how push and

pull -- >> i don't think they can do it but i don't think they've sufficiently warned the market they're not going to. >> okay. what happens is the fed feels like it's giving a lot of stimulus cut back on interest rate hikes it was going to do stopped reducing the balance sheet and started increasing it a bit and, third, it's cutting rates. on the other hand you have the phenomenon that joe talked about, one is the impact of that coming over time the other though is the lag effect of whatever is going on with the trade war. >> right. >> so powell's got a dance to do i don't really envy the position that he's in right now i think the phrase that you're going to listen for is meeting by meeting i think that's the way he's going to signal -- not going to dash hopes but he's not going to try to fuel them either. >> you were one of the first reporters in the past couple of weeks to come out and say -- >> pause. >> -- maybe they pause. >> right >> then there was a flurry of other reports that tried to suggest that the question is do those reports, if you will, give the

fed any cover or to the extent that some people were thinking about a potential pause the market either didn't buy it or didn't want to buy it? >> so i think the market did begin -- except for what was talked about earlier by kathy, the five year and the curve, the market did buy it. the market has come off dramatically the expectation for a december rate cut but i just would caution, you were shaking your head when i said this, which is the fau tires market can price something but then it comes out of powell's mouth. >> right. >> and the fed can go into something believing the market expects it and be very surprised if the market did not expect it. >> chris and kathy, thank you. mr. liesman, thank you appreciate it. coming up, quarterly results from autonation. the company ceo will join us for the first on cnbc interview. then a look at how the wildfires in california are impacting mifalies and companies out there. stay tuned, you're watching "squawk box" on cnbc

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competition from impossiblebu burger shares have been under pressure in recent weeks since topping out near $240. you can look at ceo ethan brown is going to join us to talk about the quarter. that's going to happen at 8 a.m. eastern time coming up next though, the ceo of autonation on the company's latest quarterly results. we're going to be sitting down with her and hearing everything she thinks about it. cheryl miller is standing by and will be on set next. later, boeing ceo dennis muilenburg joins us. we have a preview of that hearing straight ahead "squawk box" returns after a quick break. dana-farber cancer institute discovered the pd-l1 pathway. pd-l1. they changed how the world fights cancer. blocking the pd-l1 protein,

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autonation reporting third quarter results which exceeded wall street estimates on both the top and bottom lines joining us, cheryl miller ceo of autonation good to have you on set. >> great to be here. >> these are numbers that we

like to look at in terms of auto sales in the nation as a barometer of economic activity we've heard for years now that peak sales have occurred and we couldn't expect results to continue quite as strong but these seem strong. >> we had a really strong quarter. eps of $1.11 a share compared to analyst con census of $1.05. customer financial services was up a record 8% on a per vehicle basis and then we also had really strong customer care results up 6%. on top of that, we had some great tailwinds in interest rates. instead of having three hikes for the year, we had two cuts for the year and that really provided a nice tailwind for us as well. >> there was a lot of things in the quarter. we did some work at cnbc and $1.07 if you factored out some one-time items but solidly above expectations what i'm interested in are the segment results.

domestic segment up 5%, 70 million. imports, up 2%, 85 premium luxury up 16%. i'm trying to figure out what that means, 89 million compared to a year ago. >> really strong product launches if you think about some of the product refreshes in premium luxury from mercedes all the way through, some really great product. it drove some strong results for us in the quarter. >> mike before he left tried to -- >> still there. >> before he left as ceo he's chairman obviously. he tried to broaden the product offerings to service and more recurring business. >> yeah. absolutely. >> how's that -- that's reflected. >> brand extension is an amazing part of our business if you think about customer care up 6%, so really solid results in that, and we're not just relying on new vehicle sales if you look at used, really strong used results in the quarter as well. >> pre-owned. >> pre-owned. >> i like nearly new so we call it nearly new. >> oh, my god. >> really strong results

>> mackenzie came up with that. >> when i think about the breadth of performance it's strong if you take out one timers, you see good cost discipline in the business i felt good about that if you think about the consumer, the consumer is doing well we've got this tailwind in rates. that's really substantial. >> that has helped the rates coming down -- >> a big help in affordability we feel good about where we're positioned it does have an effect we were told it -- >> it doesn't matter as much but for cars -- >> also the new products. >> right. >> the advertising campaigns, there's a lot of money being spent right now. >> in a disciplined way but yes. >> in a disciplined way? >> i think so. >> cheryl, what about truck sales? i remember talking to mike about this for 12 or 13 years before the great recession. how are truck sales doing? because it's a good indicator of how contractors are doing and the housing economy. >> look at the employment numbers. we're seeing strength in trucks. we're seeing strength in suvs. we're excited about the lineups

out there. we're relieved the gm stroo i can is ov-- strike is over. >> what did it mean for the strike did you get to the point where you were running low on inventories? >> we really weren't we were well positioned. during the strike period we had plenty of supply i would say parts got a little tight but in terms of vehicles, no material impact in the third quarter. we feel good how we'll close out the year. >> what was your first month, cheryl, when you took over as ceo? i was looking at the chart looks like so far so good. >> looks like a pretty good run. >> you've got great employees obviously. >> 26,000 amazing associates. >> before taking over as ceo you had already started a strategic iic initiative with weymo. >> we've extended that multi--year contract we have a multi--year extension on the service part of the business. >> i don't understand how that

works. >> weymo vehicles. >> we do service them. >> how many weymo vehicles are on the road. >> in phoenix, there's a decent amount. >> you said decent is that tens of dozens. >> more than that. hundreds yeah, there's hundreds on the road out there if you look at that, we've been maintaining those vehicles we just extended that. we have a ryder program. if you are an autonation, you have the ability to take a weymo back to the office. >> without a driver? >> right now they have safety drivers. that's up to weymo how they run their program today. we're excited about talking about autonomous parts deliveries. >> tell me about that. parts delivery in weymo -- >> vehicles. in phoenix, arizona. if you think about that at autonation, toyota of tempe, we sell great toyota parts to a lot of other businesses, a lot of independents in the market now instead of putting an employee in our vehicle or in a

shuttle vehicle to take it over to deliver the part, we'll have weymo deliver that. >> with gas prices down here where they are, you're selling gas guzzlers still >> they're so much more fuel efficient than they used to be. >> what's the total percentage of electric cars at this point >> really small. these days -- >> de minimis. >> couple percent max if you include hybrids. >> how about trucks and suvs >> huge percentage, 50, 60% if you include suvs. >> what about tets la? >> that's a great product. >> where is the ev market right now? >> so we are really excited about what porsche's doing in there with the tycon coming out, feeling great about seeing that enter the marketplace. >> people who want to buy that

vehicle, are they buying it because it's an ev or buying it because it's a porsche >> both. if you think about the deposits, that thing is already sold out it's amazing, when it comes it's presold. >> people talking about the market for evs. >> yeah. >> as if it's a separate market. i always have wondered whether that's the right way to think about it. >> not anymore i think it's a great question. the market for evs, hybrids, everything in between is about customer demand, customer preference. >> when you bought that hylander was it because it was a 4 cylinder or because it was a mini van which got you the most excited >> the highlander is not exactly a mini van. >> if you have three children. >> close enough. >> if you don't want a mini van and you needed three rows with kids, it's not a bad way to go. >> i agree. >> mini van. >> i have a mini van nothing wrong with that. >> great utility vehicle. >> i looked up what the new porsche looks like. >> pretty nice, right? >> before the segment ends, tell -- >> oh, my god. >> tell us what you support. >> yes, absolutely

>> wearing them right here. >> we raised over 20 million. >> my pink shoes proud of our 26,000 associates we had drive pink across america today. we had that on october 15th. we delivered thousands of care bags to both adults and children cancer patients. it's a common purpose that unites the company, both customers, employees and autonation. >> those are size 13s. >> mine are comfy. >> you have so much room in them. >> they're all -- >> god almighty. >> great compumuter shoes. you can wear them all over the city. still to come on "squawk box," wildfires continue to tear across calif kinkaide fire continues to burn and now new fires emerging overnight. jane wells is in los angelhas a coming up. jane, what can you tell us >> reporter: hey, becky. fire doesn't care if you're rich or poor. we are in one of the most expensive neighborhoods of los angeles where they're trying to get control of the fire.

several homes lost ♪

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time for this morning's

market movers. dom chu joins us with that dom? >> top of the morning to you, andrew let's start our check of earnings movers with shares of conocophillips helping to kick off big cap energy earnings this week. shares are higher by a percent or so on very thin pre-market volume it posted profits and revenues two in part to increased production and key geographies including the continental u.s., europe, asia pacific then we have shares of xerox higher by close to around 4% roughly 5,000 shares of market, premarket volume the digital market and digital data solutions as a result it raised its full year guidance thanks in part to the new corporate contracts. then we'll end on shares of shopify which are down by around 7% or so pre-market. roughly 60,000 shares of volume. the ecommerce company posted a surprise loss. the loss was driven in part by

more spoe more spending. it passed 1 million merchants on the platform joe, those are the movers so far this morning i'll send things back to you. >> coming up, an update on the raging wildfires in california here's the futures at this hour, about where they've been for most of the premarket session. down about 37 on the dow the s&p giving back 5 1/2 from the record level hit yesterday. nasdaq indicated down about 27 we'll be right back. ♪

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as wildfires rage across california, edison international, major power supplier in the state, prepares to release earnings. joining us for a look at how utility companies and their customers are affected jane wells joins us. tell us how this is all shaking out. >> reporter: let me just give you a scene. this is part of the getty fires. this is the hills above brentwood. one of the most expensive

neighborhoods. people have to stay out of their multi-million dollar homes this is one of the homes that was destroyed here they only have 5% containment so far. this is ladwp territory but it's surrounded by affected areas covered by southern california edison after the bell we will start to get a sense of what these outages and these fires are costing utilities. the street for edison international is looking for a 4% drop. 1% rise in earnings to $1.58 but as more winds are expected to come in this week and more outages, the governor is now ordering an investigation into whether these outages are excessive, if utility companies should be penalized for them and whether they should be barred from charge willing people for power that they're not getting during the outages his particular outage outrage is leveled at pg&e. listen. >> pg&e has not been in this position before. we would like them to consider

reimbursements and we're going to be very forceful in advancing that i want as many people bidding for the assets of pacific gas and electric as pock i couldn't be more clear i hope people are serious about it >> reporter: yeah, well, he's even floating the idea of getting warren buffet to make a bid for pg&e uber meantime is offering free rides to and from evacuation centers for those displaced. elon musk is tweeting that he's offering $1,000 off if you buy a tesla solar and power wall system so you don't have to depend on the grid when the grid goes dark. guys. >> jane, just in terms of thinking that it's excessive to have these shutdowns, these power outages, how can they argue that when some of these fires may very well have been started by lines that weren't shut down?

>> reporter: well, yes that is the conundrum. what kind of technology and modeling are you using to make these decisions? certainly they will argue there would have been more fires or worse fires if they hadn't done the outages, but people -- many more people -- in fact, pg&e is getting ready after turning the lights on in the bay area, is getting ready to shut down 600,000 more customers this morning. yeah it's an iffy thing >> jane, we want to talk much more with you about this, just what it means for the lives of californians there huge changes underfoot we want to thank jane for her reports this morning jane, thank you. for more on the mounting pressure on california utilities companies, let's welcome congressman ro khanna, democrat of california whose district includes districts in silicon valley thank you for joining us this morning. >> good morning.

>> good morning. we can talk about the business side of this we can talk about the human side of this. give us an update on what you know and then i want to get into what you think should happen. >> well, it's devastating for many people across california many are without power homes are destroyed. i have a staff member in my district who had a fire that almost burned his house not because of the wildfires, because pg&e had another outage. the pg&e lines aren't just causing fires and wildfires, it's a common occurrence across california and it's outrageous >> in terms of how to manage pg&e, what would you do? >> i would have them as a public utility. they have failed to make the investments in the inf infrastructu infrastructure the regulators are too loose it's time for the state to take ownership of pg&e and make sure

that they are doing what they need to do to keep the power on and keep people safe in the 21st century when you have a state that has apple, google, tesla in it, there is no excuse that we can't get power to our people on a regular basis. >> congressman, i would argue that there are decades and decades of investment in the infrastructure if the state takes over, where do you get the money >> we need to have state investment and federal investment the reality is we have under invested in the smart grid we have under invested both as a state and a federal government but those are investments that were needed and we need to invest more in forest management we did not have the prescribed fires that were necessary. we did not have the brush clearing that was necessary. this has been a decades of neglect process that has led to this crisis. >> do you have any idea how much you might need for that, what kind of funding? >> you know, i'm not -- i want to look at the experts to see what the costs would be, but

it's probably going to be in the billions of dollars. i mean, there has been systematic neglect in the infrastructure and the forest management. >> congressman, could you see either a public/private partnership or a way to incentive advise a series of companies to come into the state perhaps to compete against each other and to invest? >> you know, the investment model with regulators hasn't worked and the reason it hasn't worked is the regulators have been captured either by special interests or not been strong enough at this point i don't have confidence in the regulators to do their job and the reality is this is not a business where you have multiple competition. what i would encourage though is the states to own the utilities and to allow more local municipal power. silicon valley power owned by santa clara. i hope the governor will call for making pg&e a public

utility. >> i'm trying to understand how you're going to finance it and whether there is some form of a public/private partnership of course it becomes a toll then and i imagine there will be questions there. you don't see even an opportunity there? >> i think if it's a public-run utility and we need certain private investment, i wouldn't rule that out. and especially if we can also allow for public utilities on cities but i think the key is that the state needs to run this. it's not enough to have just regulators but i'm open for the financing model to see if we need to rely on some private investment. >> okay. we're going to leave the conversation there congressman, appreciate you being with us this morning. >> thank you. when we come back, did dennis muilenburg and other executives know about the risk of the 737 max at boeing we'll preview today's hearing with senator roger wicker. later, senator ted cruz will m ouur guest and we'll talk to hiabt this hearing as well "squawk box" will be right back. .

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the senate congress committee is getting ready to grill boeing ceo dennis muilenburg this morning. joining us is senator roger whicker. the chairman of the commerce

committee. he's going to be spearheading it thank you for being here. >> thank you. >> what is it you'd like to hear from mr. muilenburg this morning? >> well, this is a tragedy that cost 346 human lives we need to find out what went wrong. we know it was preventible and i think what we're going to find out, there were mistakes at the corporate level, mistakes at the regulatory level and there was human error involved we want to make sure the planes are absolutely safe before they're back in the air. they need these planes and the tens and thousands of workers who depend on this industry need to get back to work too m is it fixed. there is an article.

>> they relied heavily on boeing's flight simulator where they were using experienced pilots do you have faith in the faa >> well, i think that article is absolutely correct if you had this to do over again, what decision would you make that's a question to ask at the corporate level and the faa. at this point we've learned a lot and i have confidence in the leadership of the faa now. we have a new director and the leadership has more.

we have both houses in the republican and the senate because of the unusual nature of the faa. i think if we have good leadership now i think gross mistakes were made and lives were lost because of decisions that were made, yes. >> the new head of the faa doesn't seem to be very happy with boeing right now about not getting some of the communications that have been made available to criminal investigators but not to the faa with what they're doing right now. how concerned are you about that revelation >> i'm not happy about that either as a matter of fact, we've made no secret about that with boeing and i intend to begin during my five minutes of opening. at this late date to withhold anything.

>> it was a mistake that they fully realized there was a mistake and that they will never, ever do that again. >> is that enough? >> well, we'll see the main thing we need to know, we need to know when this sort of major situation happens again can we have a confidence level that these sorts of mistakes won't happen again.

>> one of the questions about the system >> one of the things about some new laws and rules that were put in place around self-regulation. in fact, more and more of the regulatory burden for these aircraft are being taken on by the companies, boeing themselves and rules by boeing these were bipartisan laws they were signed by both sides at the time. but in retrospect do you think those were a mistake >> we're going look at that for sure let me make sure we understand those laws were not in place when these accidents took place. >> 100%. as we're trying to look forward and given that part of the argument looking back on why we

even got into this situation is both the closeness, perhaps of the relationship between boeing and the faa and the fact that so much of that regulatory effort is being put on the aircraft maker itself already >> i can assure you, and the listening public that we are going to delve deeplt it we'll talk about it very extensively at today's hearing and today will not be the last day we look at it. it's a very good point i don't think the law itself, which has not yet gone into place -- >> correct >> -- was the cause of this. >> there's a larger issue. >> yes, right. >> senator, boeing itself thinks it will have one regulatory body to abrpprove the 737 max to retn by the end of the year is that a time frame you can

answer all the questions you have about what's going on before you actually see it brought back to the market >> i think it's within the realm of possibility we don't know what the information will be. i know there have been some 800 tests with pilots from all over the world, pilots whose first language is not english, had various levels of training all of that has been done -- let me say when it's ready for the first passenger flight, i want it to be a flight that i would be happy to get on. and that the committee and the leadership in washington are absolutely convinced it's totally safe >> senator, just very quickly because you brought up the idea of less experienced pilots potentially having troubles with this, do you think that additional pilot training should

be a requirement before, again, this can be brought back to the skies? >> i think additional pilot training would have been a big help in this situation you know, the first accident, the lion accident took place a year ago today it was he some five months in between and we have a right to ask if the crew of the ethiopian crash had been fully apprised, and fully made aware of the gravity of the situation, would the second crash have taken place? so, yes, these are very complicated aircraft the most complex in the world. and these are human beings of various levels of expertise that are expected to fly them >> senator, two quick questions. one more on the aircraft itself which is we had ralph nader on

this program several times since these crashes took place he says the aircraft itself is fatally flawed that no change in the system or anything else can fundamentally change the physics of the plane. what do you think about that assessment >> i've spoken with mr. nader, and also he is a family member of one of the crash victims and certainly has a point of view. i do not agree with mr. nader in that respect i think this plane is imminently fixable. we need to make sure that it has been fixed before it's back with the traveling public but i don't think it's a hopeless cause by any means. i one that, that he has that point of view. i think it's, frankly, a view held by a very, very small minority of people

>> senator, before we go die want to ask you about these impeachment hearings and how you intend to vote >> well, i'm not at all inclined to vote to remove president trump from office. i do want to say that i look forward to a vote in the house of representatives and i've been calling on the house to do the impeachment as was done in the nixon inquiry and the clinton impeachment and so to the extent that there may be a resolution that will give us a comfort level taking place later on this week i think is a positive >> it's not a vote on an inquiry, though. ate vote on -- i don't know what is it. >> i haven't read the resolution i heard the announcement yesterday. you make a valid point we'll see what the resolution is and i hope it is in keeping with the precedence that were set during nixon and clinton

>> senator, do you reserve any reservation in terms of wanting to learn more information about this situation before making a decision >> absolutely. i'll listen to all the information. but you asked me a pointed question and the answer right now is that i really can't conceive of a situation based on what we know now, based on the facts that we know now that would cause me to vote to convict him or remove donald trump from office >> senator wicker, i want to thank you for your time today. >> thank you for having me >> coming up the fed kicking off a two day meeting. what investors are thinking. futures at this hour indicated down 30. nasdaq indicated down 25 and a 1/2. much more on the day's big hearing involving boeing senator ted cruz -- i like that beard -- he'll be our guest when we return.

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♪ ♪ ♪ ♪ ♪ ♪ ♪ earnings alert quarterly results from general motors, the numbers, instant market reaction and the automaker cfo will join us live. >> one pressure boeing ceo will be grilled on capitol hill today. senator ted cruz will be among

the questioners but first he'll join us live plus our guest host for the hours we'll welcome legendary venture capitalist as the final hour of "squawk box" begins right now. ♪ >> announcer: flif tlive from tt powerful city in the world, new york city, 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. s&p down six we had pfizer, merck, waiting on general motors treasury yields 1.82 >> earnings again once dominating today's headlines

we got merck posting p ining bea profit the that stock up 2.5% pfizer also beat the forecast. 2019 research and development expenses will be less than it had originally forecast. i don't know if that's perverse news >> gm releasing its quarterly results. let's get the numbers from phil lebeau >> the company earning $1.72 a share in the third quarter, the estimate on the street was for $1.31. there was an impact because of the strike the uaw strike during the last two weeks of september basically comes out to a 52 cent $1.72 is how much the company earned in the third quarter. revenue beat by $35.5 billion. most were expecting $36.6

billion. north america powers this company. trucks, crossovers, record production in terms of crossovers and the ramp up of full size heavy duty pickup trucks all of those helping the bottom line for general motors now let's talk about the impact of the uaw strike. in the third quarter the impact was $1 billion they would have made $4 billion theoretically if not for the strike also has a full calendar year impact of $2.9 billion works out to about $2 a share. as a result general motors is lowering its full year earnings guidance previously it expected to earn between 650 and 750 a share. now it expects to earn between 450 and 480 a share and adjusting how much it saves through cost savings it planned to go through in 2020 because of closing of some plants that was going to be $4.5 billion in cost savings now 4 to

4.5 billion because of tone plant. we'll be talking with the cfo of general motors that's dhivya suryadevara. >> thank you very much we'll see you in a little bit. in the meantime also on the earnings front, beyond meat beat company's expectations the stock is down sharply this morning. spending surged in the quarter and beyond meat is planning more store discounts as competition heats up several wall street analysts downgraded the stock overnight including jpmorgan, credit suisse and jeffries. that stock is down 20% today marks the end of a lockup

period for early backers even with this move you got to remember the stock only went public six months ago. it's about 240% since its ipo back in may. joining us right now is ethan brown, founder and ceo of beyond meat wild ride over the last six months did you anticipate you would see these dramatic moves, swings up and down >> we're focused on long term prospect for the business. overall we believe we're moving forward, fundamental of the business is remarkable when you look at mcdonald's, subway or dunkin' or kfc, those are the largest names in food and we're partnering with them to bring our products to the consumer >> when you see swings like this massive swings to the upside, big swings to the down side that's got to have an impact on your workforce and people who have money riding on this. >> for us, the effort here is as much a mission to build a large and sustainable global protein

company that will antibiotic round for decades to come. so we don't look at the six or 12 month period in the stock market we look at are we building the right thing for business >> how much do you think consumer behavior with this product and others are being driven by taste or diet or something like that or larger idea around climate and sustainablity. >> if you look at the older consumer they are coming to our brand mostly around health and karen about cardiovascular and car carcinogenic concerns. the younger consumer is more about climate. this is less fat than the leading sausage matter 37% less sodium. more protein and iron. we can build a piece of meat

from plant, you don't need an animal to do that. we can use technology to pull those directly from plants and organize them directly from plants for the consumer on their plate. >> you beat on the bottom line last night but talked on the call about how you'll have to offer some discounts is that because there's so much competition? >> if you look at our velocity, we're up 144% and people say the competition the coming it's been here we've been competing for a long time we are building a perfect piece of meat. not beholding to a supply chain. not competing among different divisions. we'll continue to execute well >> if you look at impossible burger and others. do you have big players like tyson or others who are stepping things up, those traditional

processors and packagers they don't care where they getthe revenue from they are flooding the market and very heavily financed and ready to go into a fight what happens on that front >> we enjoy being the challenger brand. the consumer is looking for something new from somebody new. it's hard for an incumbent to focus as we do to move as quick as we do. we have a single goal. we're not competing amon different i wants. my view is get in the market to raise awareness but we'll continue to lead it. >> does beyond meat have plans for pets >> great question. we get that asked all the time there may be in the future some interest within our research and development team right now we're focused on beef, pork and poultry for human consumption. >> i got kind of -- i got dogs

i look at the cover of the "post. that dog wants meat. i have two big german shepherds. >> great dogs. >> we're talking about hundreds of thousands of years of evolution as carnivores. is there some missing -- can you duplicate what carnivores need with plant based food absolutely >> it's a great question and one that i work on all the time. what i had to do to start this business of understand meat better than most if you unpack meat at its highest elements, we can pull that from plants including what a dog would need for nutrition as you build a piece of meat you have a blank canvas. what do you want to put in and what do you want to leave out? >> i wonder if there's an x factor -- >> no. >> there isn't >> no. >> when there's a pet food company, ge i got a german

shepherd i want to feed these animals meat you say that's a preconception i don't need to have >> it's a change in perception in a sense you have to insist meat comes from chicken, cow or pig or think about meat as a composition. when you think about meat as fat and water -- >> this again. you know instead of looking over at -- >> i wish i had video with me to show you i fed all our products to our dogs in a love to watch them jump up and snatch it out of my hand >> shouldn't be for humans either >> correct >> what's the hardest kind of meat to replicate. >> as you get more transparent on the plate, things like bacon with the fat and protein is so clearly distribute where the consumer can see it's harder. ground is easier ground is a little bit easier.

sausage is easier because there's so much spice in it. >> masks a lot >> get some carb >> we got something coming with beyond meat. >> i'm going to eat this and i hope i like it you love eating on tv. i don't know why >> i'm hungry. it's morning >> one huge question is what happens with the expression of the lockup 77% of the shares outstanding can now be sold today. early investors, employees, others who have that first of all, what are you doing? >> i'm not doing a thing my focus is entirely on growing this business. people have asked me do you want to do a partnership with a larger company i have no interest in that i want to be that larger company. i want to be active in asia, europe, here in the united states the test with mcdonald's, test with dunkin', test with kfc.

>> those are tests >> we never had a test that didn't go forward. >> it's passing my test. >> he's enjoying something he loves but having significantly less fat, saturated fat. less sodium. >> you are not going sell but what do you think about your partners along the way, people who are early in this or maybe employees looking at this thinking i can afford to ride a wild swing like this >> for the employees, i know their personal circumstances they may have. the early investors, investor mandate. what does the firm require >> sausage, no. >> i -- no nitrates. look at a movie called "game changer. that spells out the implication of having meat consumption on a

diet perspective much broader than saturated fat or sodium reasons people want to avoid animal protein it's things like tmao -- >> recent studies you know whenever we decide something is absolute fat -- >> you find a different doctor >> but studies have shown maybe carcinogenic in red meat fries too. their lifestyle included all that's variables there's no clean evidence that is done in a scientific setting, always in hindsight. >> there's a lot of difficulty in teasing out and it's correlations >> right >> the pfact is it's not good th to have bacon six times a day. >> thank you for coming in >> coming up when we return we'll welcome our guest show,

ben horowitz is here and talk about wework, facebook and his new book stay tuned you're watching "squawk box" on cnbc >> get the best of "squawk box" every day in our podcast ♪ ♪ ♪

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welcome back to "squawk box" futures now are indicated down about 31 points on the this morning, pre-market. merck, we got pfizer, and gm all fact jororing to what we're seeg nasdaq indicated down 21 and change, alphabet part of the problem there. >> famed venture capitalist ben horowitz is out with a new book this morning titled "what you do is who you are" which looks what

history can teach us about definition of culture and way technology companies can better adapt to scale we're going to get to the book in just a second but talking about culture i want to get your take on a couple of report out there right now that very much on this issue. >> ah-ha >> of culture. report in the "new york times" just yesterday on a letter that facebook employees sent to mark zuckerberg asking the ceo to reverse the company's policy of exempting political ad from its own fact checking program and that has now gone public and this is an issue, by the way, confronting mark zuckerberg of facebook but seeing the rise of employees at companies, especially in silicone valley all across the board this fundamentally is about culture. what the do you? >> it's tricky i think it's different if you're a normal company than if you're facebook or google, right, where you're in the policy swirl because it does get more

complicated. then with the facebook letter, i would say it was like 250 employees out of however many they have which is a much bigger number it's not kind of a wildfire, like a few angry people. >> well the question is a few angry people or is it actually more representative of a much larger group of people who didn't want to put their name to it this is the other complicated part to this >> look, there was a day when like, kind of coming out in public against a company and leaking that, you're just fired. that's the way the culture went. i think that in these kinds of companies, you know, they have tolerated it for good reason and okay we need to get the ideas from everyone. but, like then there's another thing which is are we taking it outside of the house or keeping it inside the house. and, look culturely you want to be a cohesive team you want to be us against the

world. it gets, you know -- i don't want to overly criticize these companies because no company -- no other company is in a situation like facebook. nobody is getting senate hearings and these kinds of things and they are in a special thing. for a normal company no you don't want employees telling the world that you disagree with something. you disagree and commit, that's sort of the right culture. >> then the question is in a company like these, and these are companies to some degree, what do you do do you say i can have this debate in public like this >> well, it's tricky because they have a pr issue >> right >> so, you know, look mark zuckerberg got attacked by a senator the other idea because he didn't know how many lgbtq worked only b libra forget about the fact nobody knows how much in each category. it's illegal to ask somebody like lgbtq

that's not even legal. you have a legislator asking that he's gone through the looking glass in such a way that it's hard to apply what's going on with facebook than anything else look, i think in general, yeah, he should to some degree not tolerate people taking company business outside of the company. because this is not just like oh, should we release this product or should we build that product which is a normal company issue. this is like how do athletics work in united states of america. are we undermining democracy >> what happens to people who sign this letter now the blow back? >> the blow back would be unbelievable he doesn't have a choice to do that because it feels now he's crossed over and they crossed over like facebook itself is the biggest country in the world is a little bit how it's viewed. he has all the citizens of facebook who may be upset. so he's in a very special like

place. that's a one company where it's hard to -- he would come away with what, though? you think he would say to himself i'm doing it right, i'm doing it wrong >> look, in general facebook does a very good job with their culture. like despite criticism they get. super cohesive they execute extremely well. they push forward into the future as they are doing with things like libra. but they are just in a, like almost a unique position in the world. nobody else has a facebook situation. >> but we've had so many others -- boeing has a situation -- >> that's more straightforward cultural says. they need to fire the ceo. >> they need to fire the ceo >> 100%. >> why do you say that >> somewhere along the line, no matter what you do in the regulation you'll never know what people know

there's no question people in the company knew that 737 shouldn't be in the air. the fact that earnings became more important than safety, you need to cut somebody's head off. i don't think anybody's head other than the ceo will change the culture at the place the way it needs to. like if people are dying, that's a whole different category, i think. >> okay. i'll give you a different category wework we've been talking about that company for the last several weeks now. if not months. >> yeah. that's an exciting one >> you look at the culture of that company, you look at adam neumann and you think? >> it had amazing strengths. often the strength of a culture is related to its weakness it had this crazy optimism where like they were going to change the future of work and they used it to raise a lot of money

but also attract an amazing kind of set of talent and kind of get this, you know, consumer brand for commercial real estate into the world which is a very difficult thing to do. it accomplished a lot with it, but the down side of an optimistic culture is always like what happens with bad news? can you actually hear it or it is like i don't want to hear bad news and i think that at wework like for sure whoever was going, you know, like we don't actually have as much money as we thought we did all that kind of thing >> that's a question >> i don't think that news traveled >> people can talk about wework and say look it took a visionary to get it to this place. but the question is, here's a company that may be worth $7 billion, maybe ultimately worth $10 billion or $15 billion if softbank gets its way. a lot of people went to work for the company because they thought it would be worth $47 billion. >> no question look, i think that -- that's

always a tricky question which is like, okay s-your market cap not what your investor paid for it is it like, you know -- how do you know that and so forth i do think the big problem was it got away -- the culture got away from reality. the culture was so reality distorted that they couldn't hear what was really going on in the business, and look, i've interviewed people coming out of wework i know there are people who knew they just didn't even know where the money was. not like fraud like we didn't know. we know how much money we knew how much was coming in, we knew how much was going out you get in that state. how do you get in that cincinnati along the way people go hey our system process aren't keeping up with the business people are going well that's bad news we're changing future of work. when culture goes like that you

can get into a really, really bad spot but it's not that unusual a cultural problem where if you have such a pronounced strong culture that it drives you -- >> a bad idea and then the nuts and bolts somebody has to look very closely >> your strength becomes your weaknesses you can have a culture like that that's competitive but don't quite obey the law or these kind of things. that's something that you have to decide. >> i heard somebody say you tale 32-year-old man he's jesus he will believe you >> that's also true. yeah please, nobody do that >> we'll talk a lot more about his book on culture and what it means in the world of business >> we may touch on crypto. >> and so much more. >> i need to know how you like libra and bitcoin. how the two exist. >> they are very different >> i think libra should be based on bitcoin

>> i don't think so. >> you need a stable coin? >> got to be stable. two problems with bitcoin for payments there's three. one is stability two is transaction speeds. and then three is just programmability. >> libra sounds like paypal. done sound like bitcoin. >> marketing aside -- >> we'll continue this conversation in a little bit also we got this morning's stock to watch senator ted cruz will join us live stay tune, "squawk box" will be right back is the monolithic view of emerging markets obsolete? at pgim, we see alpha in the trends driving specific sectors of outperformance. where a rising middle class powers a booming auto industry... a leap into the digital era draws youthful populations to

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coming up senator ted cruz he's preparing to grill boeing ceo this morning but first he'll join us live when "squawk box" comes back maybe then we'll have some comments on what needs to happen with the ceo with senator creac. when it comes to your customers' expectations, there's one thing you can be sure of.

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the amount of student loan debt i have, i'm embarrassed to even say.

we just decided we didn't want debt any longer. ♪ i didn't realize how easy investing could be. i'm picking companies that i believe in. ♪ i think sofi money is amazing. ♪ thank you sofi. sofi thank you, we love you. ♪ ♪ ♪ this is going to be the best day of my life ♪ ♪ this is going to be the best day of my life ♪ welcome back to "squawk box" here on cnbc we're live from the nasdaq market square in times square. let's get caught up to date on some stories pretty busy morning for corporate earnings with more notable companies reporting this hour mastercard reported a profit of

$2.15 a share that beat the consensus estimate of $2.01. mastercard was helped by consumer spend ppg a good sign for the economy. the stock is up 1.1% kellogg profit came in at $1.03, 12 cents better than expected that stock is up by 3.8% an hour away from fresh data on home prices. kay schiller is expected to show a 2% year-over-year increase that's identical to the increase we saw in july >> boeing ceo will face the full commerce committee to answer questions about the future of the 737 max. joining us now senator ted cruz, chair mapp of the commerce committee's aviation subcommittee who will be at the hearing today. senator cruz, good to see you

again. couple of moments ago our guest host said that at this point, the ceo just can't stay that there needs to be a break at the top. given everything we know at this point as has been all these additional data points have come out over the last three, four, fire months, do you agree with that is that what's really needed here, do you think at this point? >> i think that's a question for boeing shareholders and for their board to decide but i do think it is important that there be real accountability there's a lot of questions that still need to be answered. i think their testimony today very important number one, retrospectively looking backwards what went wrong. how was this plane designed with this new system the m cast system that adjusted the tilt of the nose downwards how was it designed without safety mechanisms to prevent the tragic accidents that happened not just

once but twice how was the regulatory system designed, what were the incentives within the regulatory systems to sign off on this change that caused so much danger and moreover why were pilots not trained on this. why was there no training the system changed it was no longer the case when you pulled back the yoke it disengaged the system prior 737s had but not the 737 mack ultimately answering those questions why 346 souls were last in two tragic accidents going forward we need the to ask how can we prevent this from happening again. what needs to change either at boeing or in the faa oversight to make sure this doesn't happen again. >> that's the other question it's the faa and with all the budget constraints in washington and especially from people like you, senator, and the gop, you know you want to watch every penny so suddenly the faa farms out some of their duties to the

company that they are looking at, in terms of judging whether there's safety what do you do does it need more funding? need the to be more effective. does somebody need to resign from the faa what happens there >> i think those are all questions that the committee is examining. there is always a danger, particularly when you're dealing with big companies that are subject to active regulation of what's called agency capture, of the regulatory agency becoming too cozy too much in bed with a giant corporate player i think there's considerable concern in the faa context that may well have occurred here. there was so much back and forth between the faa and boeing that you didn't have anyone really watching the store and asking the hard questions of are we ensuring that the safety prevention is there, are we ensuring the pilots receive the training they need to keep people safe, and what i think is critical here is, is the flying

public needs to be confident that when you put your family on a plane your family is going to be safe. and these crashes have shaken that confidence, which jeopardizes, there are tens of thousands of jobs in my home state in texas and across the country that depend upon a via bran -- vibrant aviation industry. >> will this have a favorable outcome, do you think, senator by that i mean, the engines were moved in the interest of saving fuel and emissions and everything else and previous version of 737 didn't need an m. cast system. is it down the road some day going to be completely air worthy where everyone will say good-bye that they are sending their family off somewhere and in the back of the mind won't be the slightest question that this isn't a safe aircraft? >> look, i very much hope so i think that's a real objective

for boeing to get these planes back in the air. but to do that they got to be able to convince people that they are air worthy, their families will be safe. i know i've heard from a number of airlines ceos that they have high confidence in the safety of the ple that it's safer to get on an airplane and fly somewhere than it is to drive t safety is impot in this instance there are a number of ways these accidents could have been prevented. simple redundancy. the accidents started because of a bird strike. a bird that sheared off a little sensor that's outside of the cockpit angle of attack sensor it was sheared off the plane when that happened the computer believed the nose was pointing up the computer automatically started to correct to point the nose down. the pilots didn't know what was going on they didn't know why this was

going on this was a new system. that could have been prevented you could have redundant attack of sensors you could have a system where you have confreeirmationconfirmn you have pilot training. all of those are the steps that seems to me should have been done and i expect we'll discuss all of those at considerable length at the hearing today. >> senator, just switching gears quickly if we have a sitting senator. we obviously need to talk about these things the latest move by the speaker here, this is still not a vote to authorize an inquiry and supposedly being done because all the republicans are doing is arguing about process and democrats want to focus on the substance ever what this is all about. will this do it for you and your colleagues in terms -- is this a real vote on an impeachment inquiry like we saw with bill clinton and richard nixon and going all the way back

is it? >> we'll have to see what the specific terms are that the house votes on i'm glad they are voting they needed to vote. they have been unwilling to vote so far so being willing to vote is a step in the right direction. but fundamentally what we're seeing going on in the house has all the trappings of a kangaroo court. they are -- the proceedings are still going on in secret the minority is still denied the right to subpoena witnesses. that means cross-examination of the witnesses, the american people can't see what the actual evidence is. and instead the way they are operating is the partisan democrats are leaking out snippets of these secret testimony as it suits them politically. that's not fair, it's not right, it's not how the house handled the impeachment of bill clinton, it's not how house to handled the impeachment of richard nixon. both of those proceedings had rules in place to protect due process to ensure fairness today's pelosi democrats have

made virtually no efforts to ensure due process or fairness and the reason is they have a partisan objective in mind i want reminds me of the book ""alice in wonderland," verdict first, trial later their behavior indicates they don't care about what facts are that after predicate for doing so, they wanted to impeach him since november 2016 when the american people elected him. >> in the current -- this latest one not russia totally different obviously subject that we're talking about here have you already rendered a verdict without knowing anything is there a way you would come to a yes for a conviction in the senate or have you made your mind up that nothing could rise to the level of annism peachable offense. are you there? >> i think we should investigate what happened. i voted along with all 100 senators we all voted to refer this matter to the senate intelligence committee and

bipartisan committee to investigate what happened. i think sure we should investigate what happened. and be open to ascertaining the true facts that is a very different thing than what the house is doing you know, you look at the house a few months ago, 93 house democrats voted to impeach the president simply because he criticized the so-called squad, these freshmen house members who said so many outlandish things and for 93 of them that was enough to impeach the president, to remove a democratically elected president. i think at the end of the day what's driving the circus that's going on in the house is a rage and hatred for the president rather than a fidelity to facts. the senate i hope and believe will have a much greater fidelity to facts and under the the constitution the threshold to remove a sitting president committing high crimes and misdeamnors as found by two-thirds of the senate, that threshold is very high and based on what's public right now i

think we're nowhere near close to that. there may be the partisan votes in the house to impeach but based on what we know now i think it's extraordinarily unlikely that the president would be removed and that's the way it should be that's the way the constitutional system is meant the to operate >> all right, senator. thank you. we'll be watching with the whole boeing situation we got to know about a lot of different things, don't we senator? >> absolutely. >> i mean it's like -- there's like ten he we infants in every room >> astros winning six. we're winning tomorrow night >> that's pretty amazing >> i mean tonight. >> they went to a higher gear or something. >> it's been beautiful >> you think you would get booed in houston like that >> it would be a very different place. the president has a lot of supporters in houston. he could get a lot of applause and some boos. coming up when we return the cfo of general motors.

we'll talk about its new labor deal with the auto workers union and i'll talk to ben horowitz about economists thriving. stay tuned we call it the mother standard of care.

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you can see what others can't. ♪ >> general motors posting quarterly results earlier this morning. phil lebeau joins us with the automaker's ceo. >> you guys beat the the street by a wide margin in the third

quiet. turn aw strike had an impact on q3 earnings even your guidance for q4 is the total about $2.9 billion for the strike impact? >> yes it was a very strong quarter as you point out the strike as you point out had an impact as well which was 50 cents for the quarter $2 for the year what we want the to focus on is the underlying performance in north america was strong driven by our crossovers as well as the truck performance, and from a strike perspective while we had an impact the underlying business continues to remain strong >> you have all of your plants running at full production how long will it take for you guys to makeup for the lost production from this strike that lasted 39 days >> we're building every unit we can. plant are up and running from a calendar standpoint since we're running these plants at full capacity i think there will

be limited you want thes to make it up. going into next year we'll take every opportunity we can whether it's weekends or holiday or appropriate overtime to make up these units. that will depend on the industry levels as well as moving into next year. we're building up every unit >> might well dig into first quarter maybe second dweert make up the lost production >> from a truck perspective we're running at full capacity, and we're going to have to see 0-the industry plays out in 2020 >> you're guys now better positioned in case there's a recession in the next year or dramatic drop off in auto sales for the entire industry because you've closed these three plants or in the process of doing that. >> are you better positioned as an automaker if there's a recession? >> we have had robust downturn planning for several years now and thinking about what are the levers we would pull and how would we adjust our volumes to respond to what's happening in the marketplace and that remains

intact we'll break even at 10 to 11 million units in the u.s. and continue to do that and we're running the business with cost discipline to ensure we're table to navigate through a cycle and that's not changed >> cfo of general motors joining us from the company's headquarters on a day, guys, where they gate the street by a wide harbor begin. 1.72 a share most expected them to earn 1.31. >> phil thanks our guest host today ben horowitz we started to talk about this before the break, ben. the original description of libra caused me to appreciate what bitcoin has, sort of buying it in july in late july i've been buying it ever since off and on it was distributed network and distributed ledger and decentralization and digital aspect of bitcoin got me and i signed on to that and libra is like a debit card. why am i wrong about that?

>> i think you're wrong in that libra is also distributed ledger that has this property that bitcoin has in i want which is trust in that you don't have to trust a company, not even facebook you don't have to trust a country you just have to truth the properties of the system so that's the really powerful thing about it >> even though it's based on a basket of fiat currencies -- you're describing it as digital gold >> the promise of is different. the prom the promise of bitcoin, the promise of libra, it will be stable relative to kind of global currencies. so that's a different promise. they're not going to inflate you, like, way over, kind of whatever. >> you can see both co-existing? >> yeah, definitely. i think they serve different purposes in a way, bitcoin is kind of, you know, at this stage, it has become a store

value. digital gold libra is solving a problem that facebook has, which is, you know, money doesn't really scale very well beyond a country and so facebook being a global entity needed payments to go across border very easily. and libra kind of -- the promise of that -- of libra, they can do that, and much faster transaction times. and much more scaleability than bitcoin and much more programmability than bitcoin. >> given the -- >> it solves those things. it doesn't have the bitcoin property, which is we're not going to inflate because if the dollar inflates -- >> given the regulatory scrutiny over libra, are you surprised that there hasn't been more regulatory scrutiny over bitcoin and do you think if it ever gets -- to escape velocity, whatever that means, all of a sudden regulators go, you know what, there is a problem here? >> it is an interesting -- i don't quite understand the regulatory questions they're asking about libra, they don't make any sense to me like, well, like, it is fairly

bizarre, like, if -- >> i think it would be easier to let libra go you can call a company, call an association. i can understand if you had concerns about bitcoin, there is no phone number. >> one of the -- one of the amazing things about bitcoin, even though it is resilient to government regulation as well, i mean, you know, you can regulate the citizens and you can say you can buy bitcoin and these kinds of things but the software is independent of a country it is run -- it can be run anywhere outside of the jurisdiction of any one government. >> it was a -- we talked off camera, 170 billion or so. >> 30%. >> 30% move on fromiday. >> remarkable that a piece of software has gotten to a market cap like that and sustained, and sustained it for a decade new. >> and if it became a bigger part of the global financial system, it would not surprise

you if it were to go above $170 billion? is it trillion dollars, an insane idea for it or -- >> i don't -- i'm a little restricted on what i can say because we own bitcoin, but the analogy you had of digital gold is relevant. and, you know, gold is certainly worth more than that in its total market cap >> doesn't have the same stock to -- yeah, but eventually as time goes by and the stock to flow will increase. >> or could be worthless >> could the mathematics of bitcoin be worthless >> i think the thing that would make bitcoin worthless would be a security breach. >> security breach would be a huge problem. >> i think a security breach -- >> you don't think there is a possibility -- >> with $170 billion bounty to

get it. >> to you look at early protocols of the internet, which people thought were going to be something, and they were something, and i don't want to say they're nothing. >> important. >> other things came -- >> that came after tcipp. >> on top of it, became more valuable >> the internet protocols are different, they were never meant to hold value, where as -- but the value of -- and the position of tcpip if it had a coin associated with it would have been very, very, very valuable as would dns, as would dhcp. a lot of protocols just last a long time because the biggest feature of protocol is that -- is interoperability. i think with bitcoin, you have a lindy effect, trust that has been around and security properties and that's the

biggest network, the most people keeping it secure, the most miners keeping it secure. >> thanks. >> down to the new york stock exchange, jim cramer joins us right now. a lot of great earnings out this morning if you look at merck, pfi pfizer, mastercard mastercard showing consumers are still spending what do you think when you add it all up? >> these are all consumer stocks merck was down last week, br bristol-myers, great quarter i'm not against what they got, but keytruda may be the biggest selling drug of all time $3 billion for merck this drug is remarkable. anti-cancer drug we have three for three. we have mastercard, pfizer, and, you know, i've got to tell you, i think merck's best in show on the other hand, we have got grubhub. and i think grubhub, if you -- if you had a headline, i would have put please don't buy our stock, you will lose money

why mince words? the user is promiscuous. >> promiscuous users, using other services we don't own them. >> yeah. it was -- >> that was a suboptimal situation. >> right >> i would rather own -- i would rather own -- i don't know, any coin, bitcoin doesn't matter the thing that they're up against, they're up against private companies that are playing with free money. and that's exactly what -- door dash is, post mates is i feel bad for them. promiscuous, it is true, do you really care who delivers your food >> no. >> do you care >> no. >> fastest, the cheapest, amen. >> yeah. i think that that's -- it was always a commodity business. they have locked up all the big chains doesn't matter there is no loyalty. it is -- there is no loyalty in that business. and that's why the diners are promiscuous. why did he have to pick that

word that word is basically saying, please don't touch our stock >> right >> it tells you there is no mote jim, thank you >> mote. >> today on "mad money," don't miss the ceo of zebra. the ceo of zraeb on "mad money." stay tuned we'll be right back. obvious. sometimes, they just drop in. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group - how the world advances. ♪ ♪ ♪

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ben horowitz has a new book

out, what you do is who you are. and real quick, in send seconds, culture. do you talk about it lead by example story or think you have to talk about it? >> it is definitely not lead by example or talk about it culture is not a set of beliefs. it is a set of actions how you get a company to behave and everybody in the company to behave the way you want them to when you're not looking, not there, very difficult and complicated and that's what the book is about. >> good luck with the book join us tomorrow "squawk on the street" begins right now. ♪ >> good tuesday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer at the new york stock exchange david faber waking up early in l.a. ahead of warner media day in the meantime, stocks look to take a breather at the open after the record high, a mixed bag of earnis