"squawk box" begins right now. good morning, everyone welcome to "squawk box" here on cnbc live from the nasdaq market square in times square sitting in with us we have tom farley the chairman and ceo of far point and the cnbc contributor great to have you here >> great to be here. >> you ready to go. >> i'm ready to go veterans day >> singles' day. 11/11. >> i was there three years ago for singles' day with jack the big screen where they tally up the sales and it just keeps going and going. >> the sales they've seen overnight is far stronger than they saw even last year. it's grown every single year >> did you know that is why,

it's veterans' day but 11/11. the number one it's 11/11 >> i know that it was 11/11. >> they celebrate their cingsi g singularity and everyone gets married. >> putting an end to the singles' day >> they have taylor swift kicking it all off for them. >> you are not single. >> no. >> disappointing so many of our viewers out there. >> stop it >> what time is it 6:01 didn't take me long. if you have it, let's flaunt it. >> let's get on to the news. >> the elephant in the room. okay i'm usually looking at andrew, so, this is very difficult for me >> please take it away, becky. >> that's right. >> that's great.

can you make mine, can you soften mine up a little bit? wow. i'm losing you know who i feel like the bengals versus the ravens. >> or the giants versus the jets >> i had the stupid giants did you see what i tweeted out yesterday? "new york post." bengals will keep it close versus the ravens. 49-10. >> close only up by -- >> omar jackson was amazing in that game. >> amazing >> looks like michael vick >> i tweeted out to the guy at "the post. i said, keep your day job. i said, wait, is this your day job? >> probably. >> he needs a new job. >> perhaps >> let's get you caught up the bond market is closed for veterans day, but stocks trading on a normal schedule and you can see ahead of that, red arrows. dow futures indicated down by 131 points s&p futures down by 13 and the nasdaq off by 32

they're all sitting at what had been new highs but they all closed out on friday you're looking at the s&p, i think it's been up for five weeks in a row nasdaq has been up for six weeks in a row and the s&p 500 is on track for its best year. so far for the year up by 23.4%. >> breaking overnight, hong kong police shot and wounded a protester who is reportedly hospitalized in critical condition. protests escalated into violence which has been rare during working hours during the 24 weeks since the demonstration began. but police fired tear gas in the central business district as frs os on their lunch break crowded the pavement and protested the china-backed government. some officers closed early and sent workers home. in the last hour, hong kong lead er said the demonstrators are now the people's enemy we continue to monitor the situation. bring you updace tes as get the.

it is singles' day the largest single shopping event. alibaba set a new record in terms of sales topping last year's record of nearly $35 billion and still climbing arjun joins us from alibaba's campus in hong kong. what can you tell us this morning? >> singles' day which just kicked off over 19 hours ago kicked off to a flier. the merchandising value. that figure you see behind me of $12 billion in an hour let me dig in to what is driving that growth and what has allowed alibaba to hit that record you see behind me just now over $32 billion. a lot of focus on imported goods which are typically very expensive in china because they are imported and facing heavy discounts. that subtracted chinese buyers and clothing, luxury brands all doing very well and a lot of

talk coming into the singles' day would american brands be affected by the ongoing china trade war and any anti-u.s. sentime sentiment. that does not tend to be the case some of the brands doing well, include nike and apple apple's iphone 11 pro and pro max are amuong some of the top selling new products analysts told me earlier apparel and jewelry are doing well and another thing driving the growth is consumers from some of the smaller chinese cities not necessarily beijing and shanghai and some have more disposable income and spending on singles day, as well. another part of the whole experience is entertainment. you mentioned taylor swift earlier. that kicked off singles' day and live streaming you get celebrities live streaming about the products and the streams can buy the products that is very, very different than how we shop on amazon, for example. it is a very chinese phenomenon

that is spreading across asia to places like japan and south korea, as well let me set the expecexpectations analysts are looking for a number of $37 billion in total gmv. right now as i mentioned, just above $32 billion at the moment. so, a little bit way to go, but still a few hours left on the clock. now, if we do hit that $37 billion gmv total, that will be a slower growth rate than we have seen in previous years because this is an event that continues to mature and hit those big figures. maintaining a 30%, 40% growth rate couldbe tough and alibaba is facing stiff competition from likes of jd and both u.s. listed, i might add, as well but, look, this figure continues to tick higher a few hours left i'll be here through midnight bringing you that final figure in just a few hours. back to you. >> that number behind you is clicking faster than the national debt clock we have around the corner here faster and faster and faster

>> that's right. i mean, it's moving fast i was taking a browse earlier, i haven't bought anything yet. i'm just waiting to see what deals are about. but a lot of people preordered just holding out a lot of people preordered over the last couple days and as soon as midnight hit here in china they were on their phones ordering the stuff that explains the huge tick up if you saw it faearlier, it was going faster but rve but, look, just continuing to tick up. still a few hours left on the clock and that will only tick higher >> arjun, i remember i was there in 2016 and i had a conversation with jack where the clock behind you just kept ticking up and the number that year was $18 billion. so, listening to you three years later sounds like they're going to more than double that total i mean, does this just keep going forever? it's now up to 15% of amazon's

annual revenue on a single day >> yeah, i mean, this will continue going it's such a huge thing here and so much excitement around it when you look at the likes of black friday and cybermonday in the u.s. and other parts of the world, as well a very different experience. it is kind of difference that they had the three to four-hour to kick off with taylor swift performing and other celebrities here in china with huge followings, as well. it is a whole other experience this stream right here is a live stream you get all the internet celebrities here talking about products and at the top you have all the discounts. people buying stuff as these live streams are going on from these internet celebrities very different experience, i'd say, to what we have when we're shopping on amazon or some other site, as well. that is all part of what they call shopertainment helping

them >> thank you very much we will see you, again, soon thanks for bringing us up to date there. uber ceo is back tracking after calling the murder of khashoggi a mistake. he compared khashoggi's death to a fatal crash of one of his self-driving cars. he called back an hour after the interview expressing his regret of what he said and later e-m l e-mailed said i said something in the moment that i do not believe. launching an investigation into goldman sachs credit card practices after a tech entrepreneur accused the bank of discriminating against women david spoke out on twitter saying the algorithm gave him a credit limit that is ten times higher than his wife even though the couple files joint tax returns and his wife has a higher credit score.

hanson is the creator of the programming tool rubio and after the complaints they bumped up his wife's limit without addressing the root of the issue. thattweet drew the attention o apple co-founder steve wozniak that said the card gave him ten times the credit limit his wife got even though they have no separate bank accounts and they share all the same accounts. he also said it was difficult for him to get in touch with a human for a correction on that on twitter goldman sachs bank account said with apple card your card is individual to you you establish your own direct credit history we look at an individual's income and credit worthiness based on these factors it is possible for two family members to receive significantly different credit decisions in all cases we have not and will not make decisions based on factors like gender. gp morgan jamie dimon speaking out about the wealth

gap in america he was pressed on the issue of income inequality and his own salary. >> executive pay last year you were paid $31 million. too high >> the board sets mine i have nothing to do with it >> you could return some of it >> i could would it solve any of those problems i'll leave it to the board my board >> but this one you're -- >> the board has to do it. >> let me ask it in a general way. should exec positi should executive pay in this country be curbed? >> what does that mean >> cut back. should there be a way to say, we're not going to have such a spread between our workers and the guy at the top >> you know, when you say something like that, you have to say, how are we going to do it i think you use the taxes to do that i would have spend the income

tax -- >> what is buffet's thing? you criticize with -- >> criticize by category, praise by name. >> i'm talking about "60 minutes" i'm not talking about jamie. i went back to the football game after about five minutes >> i watched the whole thing >> i could interview jamie myself or watch us interview him. he needs a bigger audience, he goes on "60 minutes. but the questions were, what is lesley stahl's salary and what is the average cbs employee salary what is the ultiple there and what is her job asking questions she doesn't really understand. he has a quarter of a million people are employees that depend on him to make the right decision for a bank to gauge credit worthiness and to anticipate the financial crisis better than anybody else anticipated it to protect shareholders and -- >> she made the points about the quarter million of employees and she pointed out that he's the

last man standing. the only one that is still there since the financial crisis i couldn't figure out why jamie agreed to do it. if you watched there was a second part about what they have done in detroit and that was actually a very good piece and very thoughtful. i didn't realize, watching the beginning i was like, why did he bother to do this? why would he do this because it doesn't come off very well >> you get to reach a lot more people, i guess. >> seemed to me like thit was a ba, they did this whole piece on detroit. they've done very good work and they are making a difference along with other companies like what quicken loans has done and dan gilbert and others who have done this. they are going block by block in the suburbs and trying to rebuild them that piece was very good and very interesting by the way, we have to talk about news >> this was the snarky approach

to banksters what was the last one i saw her do where i said i'm not going to watch this one >> i can't remember. ju . >> i thought the detroit piece was very well done >> really. >> it was very well done this part at the beginning was, let's address the fact that you made comments about elizabeth warren and she's taken and run with that. i don't know if you saw over the weekend elizabeth warren had the billionaire calculator, are you a billionaire, yes or no let's find out how much these guys are making and any billionaire that said anything about her. bezos and just got thrown in but bill gates said something with andrew and that got picked up and that is in it and jamie dimon and all these guys and it was missing, i thought, warren buffett is not in it >> if you wanted to get the word out, some of those interviews.

>> the detroit piece was very well done and thoughtful and it does talk about, in a broad way, what jpmorgan has done there that none of us have highlighted very well. it served its purpose with the second part of it. very well-done piece >> don't you think we're just starting with this as a topic, too? i know it has been going on with elizabeth warren for a year. she thinks it is a winning issue and "60 minutes" thinks it is a winning issue. it is a staggering amount of money. the thought is you keep saying -- >> if the boards, that's the problem. if it's a good old boy network and the boards are in the pocket of the it's based on creating shareholder value which might not be created by another ceo. there is a race to get good talent you can see what happened -- >> look no further than europe where ceos can do a fabulous job and they don't make --

>> over here, the turnover in ceos here is at an all-time because if you're not any good you do -- there is a lot of times when you're not going to keep your job. if you are really good jamie dimon a reason he is around i hear you with the $31 million. but if you have a really, if you're a lefty and you really got heat and you can throw a change-up. do you know what you make on the baseball field for that? do you know what you make -- >> $31 million. >> about $31 million you said -- >> i'm saying there is a view. there is a certain amount of the viewing public that watches elizabeth warren that says billionaires must be terrible people and they don't stop to say, what is the back story? did they earn it was it valuable? did they help create jobs? would it be good for our economy to have billionaires go to zero? there is a segment of the public that just -- >> but the interview this morning with the guy who had been advising elizabeth warren,

we had him on here the guy who advised her on the wealth tax who we had on here. >> the economist >> the guy we had on a couple times. interview with him this morning on bbc and basically he said billionaires shouldn't exist nobody deserves that much money is the theory that goes into it behind it. >> right like i said, green bay that game, did you watch the end of that i'm not kidding. it's snowing it was awesome and i had green bay and they had to win by five and by this much, they hung on >> and you didn't have to watch the interview. >> draftkings has made your life so much more interesting >> i am down $300 i think i bet on 16 games. >> you watch every game. >> i bet on an ncaa basketball game today it's getting worse >> i heard jamie make a passionate defense of ceo compensation before. >> he does

but also just in general >> maybe "60 minutes" cut it >> he is very sensitive to income inequality and trying to equalize opportunity across the board for everyone >> which is what the firm has done >> but he will defend capitalism as the best system, ociobviousl that the world has ever found. >> they did a very nice job on what jpmorgan has done with job training and trying to rebuild on a block by block basis and it did get into that afterwards >> there is a reason mike bloomberg is getting in because elizabeth warren and bernie sanders take of the world and what we should do with the economy and if they run either one of those people, they're probably not going to win. they can appeal to people that, for whatever reasons think -- i mean, we have tried socialism many times places where they think the state should own all the means of production.

fine, you could try it again maybe it's never been done right. but i don't think it is ready to get a majority or plurality in this country at this point, do you? >> i think people know -- >> what was your previous life weren't you in charge of the stock exchange >> i ran the new york stock exchange >> you make too much money are you self loathing now? >> capitalism is the greatest good poverty is down by 80% during my lifetime. >> you can watch it happening and about 500 years old since you did own your own ideas >> i think the public knows elizabeth warren is selling -- >> really. that's why she's -- >> she's going to lose all the swing states >> who is going to go win then >> you don't know who is going to win the nomination. >> i'm saying if she wins. if she wins, i think she loses all of them. >> i think there is a lot that could happen >> all right, coming up.

get ready for a busy trading week among the highlights closely watched speeches by president trump and jay powell we'll tell you what to expect. that's next. does your broker offer more than just free trades? fidelity has zero commissions for online u.s. equity trades and etfs, plus zero minimums to open a brokerage account. with value like this, there are zero reasons to invest anywhere else.

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welcome back start of a busy week here is what is on the stock planner. stocks trade on a normal schedule tomorrow we will get earnings from cbs, tyson foods and smile direct club. we'll also be watching when president trump speaks to the economic club of new york at about noon tomorrow. on wednesday we'll get earnings

from cisco and ten cent and the latest read on cpi and on wednesday fed chair jay powell will speak before the joint economic committee and earnings from canopy growth will get ppi and jobless claims and fed chair powell speaks before the house budget committee then on friday the latest retail sales and import price data should be interesting today. who is there cuomo at the veterans day parade president trump and are they all going -- >> they're all on the same float. >> no, i think president trump is only meeting them ahead of time and saying something. he's not actually marching you're not going to see the three of them riding the float together that would be fun. >> it's going to be fun anyway i mean, seeing them. that's the whirlwind right now like open warfare. it's crazy joining us now -- like the show. joining us to talk markets jason

ware jean goldminean cio the market is down today so you'll look a little better today in terms of your past appearances. you still don't really like stocks you think that things could probably still happen. the trade war could reemerge you never know what president trump is going to do how long have you been not friendly towards stocks? the s&p is 30, where is it now, 2700 were you recommending no investments. honestly, when did you get negative >> thank you, joe. happy veterans day you know, clearly, throughout the year we talked about this. cautiously optimistic. we have been looking to take the bright bets in our portfolios. some of the downside risks are starting to fade but still three or four clear risks that we're watching closely the trader wa, yes, it's on

pause, but president trump could easily, easily retweet something and all of a sudden things get reversed we saw this on friday. we were surprised markets didn't reverse on the news. second of all, valuations are pretty high. well above the five-year average. this is pricing in absolute market persfefection. you look at third-quarter earning. even this year first annual earnings up 0.1%. this year's market move is really pure on price multiple movement higher. third of all, you talked about this earlier with your earlier guests, we really believe the political uncertainty. you have michael bloomberg jumping in this definitely benefits warren as a candidate we'll see how markets like that on a go forward basis and the last point is bond yields. bon yields jumped 40 basis points if you are a foreign investor. a lot of foreign investors buying treasuries and if the dollar has a 5% decline, all of

a sudden, these investors have a two-year loss in yield so, we're watching this very closely. again, we're not like complaining about the markets being very negative, but all we're saying is be very cautious in this environment right now. >> where are you, jason? do you think we go, let's call 3,000 just the average of where we are we're going above that or below that in the near term and immediate term or the next six months >> i think looking at the fundamentals and the momentum of the market the safer bet is we are going higher we are certainly not short-term traders and we're long-term investors. we prefer to take a little different view on where it is going to go versus three to six months what we heard is a list of reasons not to own stock and i would argue a lot of reasons to own stocks, especially if you're a long-term investor valuations are not that expensive relative to interest rates and inflation. come down to reasonable hurdle in our view. i think q4 is expected to be

negative slightly next year. 8%, 9% something that can be achieved by the market. trade has been put on the back burner companies telling us the economy is doing okay. if you look at the fundamental underpinnings of this economy, we are still at a 2, 2.5% gdp environment. owners of good companies for the longer term and that's what we're telling our clients. >> if earnings go 8% next year 16 times seem, are earnings going to come down >> it's a great question and i agree. they are cheap relative to that expectation. in truth, what typically happens is the earnings start high and they come down and analyzed are advised lower and that hurdle gets easier to beat. its expectations is really going to drive stocks. i think that is a good set up for next year. not sure whether or not we'll beat that 8% or 9% bogey, but i think it's in the ballpark and supportive to equities as we look out over the near term.

>> go ahead, gene. >> yeah, we look at earnings 8%, 9% next year they are a little elevated there will be inflationary pressures. wages are rising and there are concerns and we do believe that wages will push earnings down. margins will be declining. so, we do expect analysts to res have next year's earnings. right now, 8%, 9%. we can see them down 5%, 6% pretty easily. >> we'll end it there. thanks >> thank you when we return, we have a special edition of the executive edge we'll talk about hiring veterans next "squawk box" will be right back. datadog has become the modern monitoring and analytics

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time now for a special veterans day edition gaming company has launched a campaign with general james mattis his message is that one of the best ways to honor veterans is to hire them >> you'll hear a lot about how coming out of the military means that you're somehow damaged goods. i would reject that. i believe that people coming home from combat could haactualy have gone through post-traumatic growth where they grow stronger, kinder and they're more courteous and probably the most important thing we can do is provide jobs

for those who get out of the military >> the call of duty endowment has funded job placement for more than 63,000 veterans just in the last ten years. it ames to hit 00,000 placed b the year 2024. we're going to talk more about this important issue later with general david petraeus. coming up, a couple downgrades to tell you about, including hp and qualcomm. we'll show you the reaction in the stocks straight ahead. today's big number $630,000 that's the median listing price of a house in hawaii making it the most expensive place to buy a home in the u.s., according to data from zillo. through the at&t network, edge-to-edge intelligence gives you the power to see every corner of your growing business.

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good morning u.s. equity futures at this hour indicated down about 140 points. there is some weakness at the outset the beginning of the week, obviously, the nasdaq indicated down about 46. s&p indicated off about 13 or

so does come after a week of new highs that we pointed out. last week, i don't know, we had three or four as we continued to melt up, it seems like >> what has it been six weeks in a row higher for the nasdaq and five weeks for the s&p 500 >> 3,093. >> all three of the major did on friday. piper jafry reducing price target from $55 to one piper citing a slowing macro service provider sectors and right now it look like that stock is off by 1.3% morgan stan hley downgraded shares the semi conductor peers has closed moving price target from $89 to $90. okay moving it up by a dollar, but you can see that stock down by about 2% and then evercore that is upgrading hewlett-packard

from outperform to in line among xer xerox's bid for the company. right now the stock is at $19.59 when we return, disney's streaming service is set to launch tomorrow. we'll talk about what it means for investors as the streaming wars continue to heat up. plus, new details from the trump administration on the vaping crackdown we'll be joined by dr. scott gottlieb to talk about the latest developments. stay tuned you're watching "squawk box" right here on cnbc. is the monolithic view of emerging markets obsolete?

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welcome back, everybody. disney's streaming service is set to launch tomorrow that service is going to be priced at 6.99 little lower tha

hbo and max. bob iger joined after fourth company earnings >> ready to go, i'm glad to say. we tested it in the netherlands. we'll be talking about that a bit on our call and it was quite successful the product of the netherlands b did not have original content and well received but the user reaction to it very, very navigable meaning easy to use, elegant, great access to our brands and our storaly telling. >> joining us now is alexia media analyst at jpmorgan. thanks for being here today. >> thanks for having me. >> what do you think the question with all of these things has been, okay, now that traditional players are getting into this. they are not going to be able to spend the same amount that a

player like netflix. what do aiothiyou think? >> disney all the brands and programs they put on i think they match netflix if you take into account the movies and everything they do >> will the stock appreciate that or not? >> we know this has been coming for a long time. they had an amazing investor day in april about that and bob has been talking about it before then for a while they gave guidance and we knew about $2 billion a year by 2024 and that's on top of investments they've already made, right? they got the box office coming to them. >> huge library it comes with, too. >> the movies, aeeverything els. >> what do you think in terms of measuring success. what will you look at saying this will work or didn't work? >> the investor community and sale side community are laser focused on sub growth. the numbers have gotten crazy. you don't know huge success i feel like no one has the

marketing arm and the content and the expertise that disney has and i think it will be very successful the question is, how quickly i heard number s 3 million to 2 million in the first quarter and that is six weeks because it launches tomorrow. i can't imagine they'll hit 25 million in six weeks, but the point is a huge range of expectations and i guess the only concern i'd have in the short term is that investors' expectations don't get too high, too fast but i generally think it will be a very, very fast. >> if we saw 10 or 15 million, you'd say, that's fine we'll see what comes >> generally publishes 5 million in six weeks but we don't have sense of timing. 15 million for the first year and we'll see what goes. >> alexia, who has to sign up right away who is the customer that the moment they can, they absolutely have to sign up. >> you have 30 million homes in

this country with kids assume two-thirds of those think this is a compelling product inexpensive price point. >> 30 million households with kids just taking my own household two 11 year olds and 14-year-old they're out of the disney products. >> until they go to school and hear about the tween shows or hear about the "star wars. >> they're never totally gone. >> you're never gone >> my kids are teens. >> so are mine and they're excited. >> how does this match up with what you're expecting from some of the other players hbo max and what you'll get from peacock with comcast >> this is compelling because the brand is so compelling and so many brands, right. pixar, disney, marvel. i think this is more compelling. but doesn't mean the others can't work at some point, there will be too many and they'll be windldown tt

a few. people trying them out but the price point here is so compelling >> i saw a poll yesterday that said americans are willing to pay for four maybe even more services spending something like $46 a month on these streaming services does that surprise you >> if you eventually get rid of your cable, that seems very affordable if you're doing the cable bundle and that, i would say people are going to be trying a lot and then narrowing down to two or three. >> which ones do you think are the winners in that scenario >> you'll keep netflix, but i think disney has to be the other one. >> what is your take on disney shares >> we like them. we have an overweight. i think it's appreciated a lot already. so, i don't know if it stays still until we see some numbers on the sub side. so, we will see what they are eventually so, it probably sits range bound for a little while and rally

assuming the number comes in at a good number. >> it rallied twice on this already. on something they're not charging anything for. $250 billion >> i think management, disney in a way has a harder job because they have to balance pleasing the shareholders that want to see earnings growth and seeing good, rapid, rapid growth in this product it's going to be a bit of a balancing act. >> what are expectations in terms of the end of the quarter. is it your 5 million >> i heard ten, really most consistently between five and ten. >> thank you good to see you. >> thank you >> at home there is like all the machines are going off every time you say that. >> alexia. >> we had to get rid of the product. >> honestly >> i think there is a way to change the name. but we had to turn it off. >> you know, it's listening. in my house, that kind of -- we

thought about turning it on i said leave that thing off. and -- >> i don't turn it on at my house either >> you don't >> no. >> afraid. afraid very afraid. be afraid. coming up, regulators announcing an investigation into the apple card algorithm after a report surfaced of sexism and credit limit decisions details s after the break. don't forget to subscribe to our podcast. you'll get interviews, original content and behind the scenes access look for us on apple podcast or ppndour favorite podcast a a subscribe to squad pod today

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said it will be opening an investigation into whether or not the apple card's credit limit algorithm discriminates against women. fold man sax says our credit decisions are based on credit worthiness and not any other basis prohibited by law. joining us for this and more, joan salzman c net senior writer and joanne lipman author of number one best seller "that's what she said" and a cnbc contributor can't we look? someone knows how algorithms are written. isn't there a way of finding out whether this is true or not? >> these algorithms are a black box. >> someone wrote them, right >> ere's the issue with the algorithms is that they're written by humans. they are essentially a language and if the humans are biased, the bias goes right into the algorithm and then the information that you feed into those algorithms then becomes

biased. >> their paper trail is more than is actually happening. >> i wish there were and i wish that was the case. this is an issue that is so much larger than apple because any company that is using algorithms to make decisions whether it's on lending, on health care, on criminal defense, any of these systems, if there's bias that's built in, then you have bias that comes out >> although i have a hard time believing that they actually have an algorithm that counts you down if you're a woman because that is a violation of law. there may be something else inherently that gets biased into it. >> i think there's a lot that's sort of an unconscious bias. it's the way your factors are put into t. it's also the information that's fed into it. >> they ask your salary i would assume. >> if you look at the situation where you have people, the couple that started this all where she's got a higher credit score than he does and he gets 20 times a higher credit limit, you have steve wozniak who says,

you know, he and his wife have joint everything and he got ten times more clearly there ease something at play we have seen bias in other venues as well this is not just an apple issue. >> in that example it doesn't seem crazy to me i know it's fun -- i'm not saying you are but just last night looking at twitter, viral. everybody likes to jump on goldman sachs. in the couple that you described, let's say in this case it's the man, it could be the woman is the earner, the other spouse is not an earner, they're not always necessarily married and in a union with joint bank accounts. so you could be issuing a credit card the next day they could get divorcend and you have one that's credit worthy making a bunch of dough and another that is not. >> as wozniak said they have other credit cards that are joint. there are clearly factors put into there i think there is an enormous issue that we do need to understand because the algorithms are a black box we should know what's in those

algorithms and it will get even more extreme with machine learning where machine learning if there's any bias going into that information, then it gets doubled and tripled down upon like we saw with amazon. amazon is using a machine learning tool to screen resumes, right? >> right. >> they found suddenly -- >> inherent bias. >> suddenly they found that it was screening out women because the information that went in to this machine learning, the machine was learning not to hire women because historically amazon had had a poor record of hiring women >> got an answer for that? >> well, you know, the problem with inherent bias is definitely there, but i think that we -- i don't know how much inherent bias has to do with machine learning and just the fact that it's baked into a lot of financial crediting decisions. not only the ones based in technology but based on human choice i believe that goldman sachs is the one that's taking point on the decisions about approving credits and what credit limits

are and so, you know, goldman sachs, although certainly a company known for technology, it's not in the same realm as apple. and i also think that, you know, apple if you're looking at who's going to take some of the blame for this, apple i think has a much better halo than goldman sachs does >> i mean, you would need a controlled -- you'd need to control all the other variables that might go into inadvertently coming to that conclusion, i believe. has that been done if we say that's a black box, we'll never know are we dancing around the edges? >> you're right. we need to have a better understanding what are the factors that do go into that are there factors that we need to think about changing or is there inherent bias built into it >> you need a control -- there are so many -- just thinking about the latest about red meat. does it or doesn't it? red meat eaters, they have french fries and they don't work out a lot.

there are all of these societal lifestyle choices that are prone to people that eat a lot of red meat it's never been done where you factored out all the wild cards with it. i mean, it's just really come down to, you know, what kind of chromosomes you have when you're born i don't know >> it will be interesting to see. we're seeing a lot of the problem of a black box we're seeing that investigations are the things that are starting to crack that black box open those are the way the investigations and the ways we're getting tech companies start to have to show their cards because they don't have any choice. >> all right we've got other things to do joanne and joan. he didn't even try >> joe >> joan. >> super easy. >> joanne. >> totally >> all right when we come back, we're going to take a look at the market impact of the ongoing impeachment process. what's priced in and what could give the markets a surprise. l ve more on that when "squawk box" returns this changes everything.

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non-gmo, made with naturally sundown vitamins are all sourced colors and flavors and are gluten & dairy free. they're all clean. all the time. even if sometimes we're not. sundown vitamins. all clean. all the time. markets under pressure stock futures falling ahead of another big week that includes a big speech from president trump and fed chairman powell heading back to capitol hill. more protests in hong kong today's demonstration turns violent. we have the latest developments. and ecigarette crackdown is vaping about to turn into a political issue. we'll talk about that and the breakdown of what's causing the lung illness that has led to dozens of deaths

second hour of "squawk box" begins right now. good morning and welcome back to "squawk box" here on cnbc on veterans' day. i'm joe kernen along with becky quick. andrew is off today. with us tom farley, former mise investment group he's chairman and ceo of fallpoint llc and a cnbc contributor. we'll talk about that. you might be back tomorrow. >> special thank you to all the veterans. >> yeah, exactly we'll mention that talk to you every time we come back in from commercial. bond markets closed for veterans' day. u.s. equities at this hour are weaker on a percentage basis coming off all-time highs. maybe not that much. >> the news is the momentum shift. i mean, when you watch stocks go

up every single day. >> on a percentage basis, it's half a percent >> yeah. so the first pull back we've seen in a while. >> in the morning. >> we did see another record close across the board for all three of the major averages on friday. >> i haven't seen hong kong but it was off 2.75%. >> probably because of the news breaking overnight hong kong police shot and wounded a protester who is reportedly shot and hospitalized in critical condition. they shot into the violence which has been rare. police fired tear gas in the central business district as office workers on their lunch break crowded the pavement and protested. the china-backed government has been the subject of these protests we should say that many places we saw closings come early some offices had actually closed early and sent workers home as a result of this violence. earlier hong kong leader carrie lam said it's exceeded

violence it has been half a year since this began 24 weeks now we're going to continue to monitor the situation and bring you updates as you get them. here's what's making headlines this hour. american and southwest airlines have both extended flight cancellations involving the grounded 737 max jet both have removed any 737 max flights through early march as boeing continues its effort to restore the jet to service alibaba is seeing record sales in its annual singles' day event. they saw 30.7 billion in sales within the first 18 hours. this is the 11th year alibaba has held the singles' day event. weird. the whole concept to me is a little bit weird it became a big retail day because you're celebrating being single. >> same thing as valentine's day. the opposite >> exactly the opposite. >> we've done it

i'm going to celebrate being alone. that's no way to go through life. >> you can celebrate your independence >> i will say it's resonated with youth, right? >> yes. >> when i was there i felt like i was in another universe. k pop bands, youtube celebrities. >> like walmart's annual investor day all kind of celebrities that come into that. >> did you feel old? >> i felt old. i felt like i just didn't understand the culture. >> yeah. >> it didn't seem fun to me at all. look at somebody trying on a dress, oh, my, i have to buy that dress and they gameify it. i bought the dress and one out of every ten friends gets it free the register keeps running i just didn't get it i felt foreign i felt -- and i was literally foreign but i felt foreign. >> you are foreign

and taylor swift, we know about her -- >> i would have liked that part. >> i know. but her record in the romance category is littered with -- a lot of her songs are about breakups. >> singles' day is -- >> here she is over there celebrating singles' day >> i hope she finds that love eventually she's young. it's hard for her. how does she know why someone is expressing love for her. she's going to be worth a billion dollars. >> good thing you found penelope. >> it is >> i know. >> you never know. >> i think this new guy is the one for her. the new album is all about this guy. >> is that true? >> it's like love. >> there's one song about cornelius street. >> we're analyzing taylor swift? >> that's because she's over there for -- but she has had well-documented -- >> yes, it's been her success. after she breaks up -- >> kennedy, when she was with that kid she had the disc jockey for a while, right

>> actor >> huh >> she had an actor. huddleston. >> you're right. harry styles with the hair. >> i'm impressed you two are really up to date on this. >> we are, but he more than i. >> i don't think so. >> we're really getting -- the producers -- >> don't worry about him. wall street always keeping close tabs on what's happening on capitol hill and inside the white house. eamon javers joins us with the latest developments out of washington good to see you. hope you had a good weekend. >> reporter: good morning, becky. it's going to be a big week here in washington in terms of the impeachment of the press on wednesday you'll have the first public hearings. that should be a big set piece and crucial moment on friday we saw something we haven't seen before which is the white house acting chief of staff adding his name to a lawsuit against the president and congressional leaders. the object here for acting chief of staff mick mulvaney is to figure out and get the courts to

decide for him whether he should follow a congressional subpoena to testify in this impeachment inquiry or whether he should follow thepresident's orders and not comply now there's been a lot of speculation over the past 48 hours or so that this indicates some schism here between mick mulvaney and how he should go forward. the president would prefer that mulvaney not go to the hill and get involved in this court case. i talked to a senior white house official yesterday who said this poo-pooing some of that speculation saying mulvaney's counsel is working with the white house counsel and was fully appraised. this is a technicality only given the nature of the competing instructions it's not adversarial towards the president of the united states and in no way indicates any distance between mulvaney and trump. we'll see how that one will play out. and the public hearings on

wednesday. the president is in new york and will be in new york tomorrow making another big set piece speech on the economy. we'll watch that as well. >> eamon, thank you. eamon, correct me if i'm right is it less than a year now >> until election day? >> yes >> yes. >> reporter: yeah. yeah >> just checking. >> november 3rd. >> you're getting my math. >> reporter: are you getting ready? >> i think when it's less than a year -- >> we might actually start talking about politics >> the question that you asked about whether it will start affecting the markets becomes more -- i think after the first of the year when we're in 2020 more so. >> reporter: there's a couple of thresholds for market impact i'm not a markets guy. if there was a sense that the president's support in the market was eroding and you could see removal after impeachment, impeachment happens in the house, then the senate holds a trial to decide if the president

is removed or not. if that started to erode, you could see a market impact. the reality is that you'd see a mike pence presidency between now and the end of this term so the question would be what do markets think about mike pence as president and does that give them uncomfortable feelings about where things are going to go in 2020 does that make an elizabeth warren presidency after mike pence presidency you get knock on to knock on scenarios for the markets to consider. >> trump could run again too >> yeah. right. well, no if he's impeempached and remove, you can't -- >> i'll check my pocket constitution. >> do you have a pocket edition of that? i would like to know that? >> reporter: no, but i have an iphone i can look it up as soon as we get off the air. once you're removed, that's it >> predict it is -- predict it

is very i will lilliquid at thi. bloomberg for a couple of minutes was up at 15 cents he was above now he's back down below andrew yang >> bloomberg seems like a tough one, right >> tough for democrats. >> a lot of opposition research, right? stop and frisk policing, any sort of me too related issues. >> amy klobuchar said we're all -- you need to come in and save us because we're all so terrible >> right. >> apparently it's up in the air question run again. the process bears examination. it's never been used before. no u.s. president has ever been convicted of an impeachable offense by the senate. >> nixon's case he felt like he was going to be impeached. the republicans came to him and said, we don't have the votes anymore, sir, that's when he

resigned it was a resignation >> i think right now if the senate were at about zero. >> zero republicans willing to remove -- >> are you sure about mitt romney >> i'm not sure. you never know about mittens. >> slightly north of zero but nowhere near the 20 that they need. >> right, could be north of 20 anyway, for more on how the events on capitol hill could impact the markets, let's bring in our guest right now, brian gardner, kbw's washington research analyst and sarah bianchi, evercore isi. u.s. politics head at purdue brian, sarah, is there a better site than predict it to figure out where the smart money is going on these things, brian >> i don't know. one, as you noted on the bloomberg issue, it's a little

illiquid two, i don't think it was that accurate going into 2016. >> i don't want -- i can't use the polls. i mean, come on. >> no, i -- >> anything versus the polls. >> joe, i actually think the polls were roughly accurate. >> are they accurate now >> on which? on the general or the -- >> you tell me you tell me. does elizabeth warren 8 points ahead of donald trump? is that how you'd put your money on if the election were held today, brian >> at the national level she may be close to that i think what's more interesting is to look at where the battleground polling is in states like the great lakes industrial areas, in florida, and there it has a very close race, one or two points either way. so, yeah, i -- i think the polls are roughly accurate again, you know, then you have to factor in, you know, what is turnout going to be? how engaged are voters right now? you know, yeah, i -- >> "new york times" had 98-2 on

the night of the election and it switched to 98-2 on the night. whose poll were they using that night, brian >> from where we sit, i think the polls give us a roughly accurate picture of where the election is. >> what happened last time you said it was pretty close, but obviously -- if people were using the polls to decide last time, they were abysmally disappointed in the information they were getting before the last election. now maybe you say that the popular vote, it was kind of close or whatever -- >> and that -- that's why i made the distinction at the top of my answer of the national polls versus the local polls look, there were a number of state polls that were quite accurate goinginto 2016 in florida, in north carolina, in ohio yes, the great lakes states were off so, you know, you have to take it with a grain of salt, and i -- so when i look at predict it, when i look at the polls, i don't look at either of them as being entirely accurate.

i get -- i think they give -- one, they give you a rough idea. two, much more important, it's something i should have mentioned, it shows you where the trends are you look at polls over time and how the electorate is evolving and so a poll today doesn't -- is not necessarily predictive of where we're going to be in a year, but over the course of a year polling taken in the aggregate can show us direction of where we're going. >> sarah, weigh in here maybe. >> yeah, i guess i'm not as bullish on polling i think, you know, predict and other things,they do show you trends they do show you directional movement but they were directionally wrong in 2016. i think what you're seeing with bloomberg is a little bit of interest when he first got in and then the reaction that you saw, which was basically the warmest welcome that he got was from elizabeth warren and bernie sanders and not really from voters so i think he won't actually end up getting in the race because i

think when he pressure tests this into out there in the country, real people, real conversations, he's going to find that actually setting this up between warren and a billionaire is not particularly the best place for the moderates in the party to go. >> sarah, brian, if the house rushes through impeachment and there's a trial the beginning of next year, how does that impact sanders and warren because wouldn't they actually physically want to be in the senate for however long mitch mcconnell chooses to have that trial? >> yeah, it is going to have an impact on the primary, and i think that's what the market is more focused on. as you said, the senate doesn't have the votes to remove and that's not likely to change. it is going to have an impact in iowa where voters expect their candidates to be on the ground in december and particularly in january. so it is going to be a complicating factor. it's not just the two of them. it's also a kamala harris if

she's still in at that point and cory booker and then also the conversation is going to be about impeachment and it's going to be about ukraine. it's not going to be about the distinctions that i think folks really -- primary voters really want to see, which is medicare for all versus other approaches on health care so i i this it's unfortunate for the process in general so they're going to have to figure out a way, whether it's paid advertising or other ways to get their message out on what voters are actually focused on. >> brian, sarah, thank you >> thanks. >> we'll probably talk again, i have a feeling probably after the first of year i can almost guarantee it but thanks. still to come this morning, uber ceo is walking back comments he made about the murder of journalist jamal khashoggi being a serious mistake. we have that story next. and the crackdown on vaping and ecigarettes. has it turned into a political issue that could impact the 2020

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♪ ♪ happy veterans day. happy veterans day. happy veterans day. happy veterans day. student veterans of america champions those who have served and also prepares them for their next chapter in life. please take a moment this this veterans day to remember service members, who put their education and careers on-hold to give back to all of us.

we thank you. feliz día de servicio. happy veterans day. happy veterans day. please visit studentveterans.org welcome back to "squawk box," everyone uber's ceo is backtracking after calling the murder of jamal

khashoggi a mistake. he compared the death to a fatal crash. axios said he called back an hour after the interview expressing his regret for what he said and later e-mailed a statement saying i said something in the moment that i do not believe >> got to figure out the problem is that premeditated murder is different than an accident. >> yeah. >> that's the problem. it's not like you don't look at it as a pr mistake i don't know if you look at a fatal accident in a car, that's a serious -- it's an accident. >> right. >> that's the key difference you've got to be so careful. i'm just telling you, you're going to be here all day tomorrow, too, right >> right. >> choose your words carefully. >> right, or i'll be off the air. >> i watched that interview. dan primack, it was a very tough interview. he immediately made the mistake

you made those are two very different things dara is so eloquent and articulate, he was pained when he was answering you could tell he was conflicted when he called back an hour later, most cases it would be the pr flakes told him to do it, i think it was dara. he realized that's not me. that's not what i feel. >> do you tweet? >> no. rarely rarely. >> i'll tell you what you can tweet. you have a puppy, right? >> yes. >> tweet puppies >> don't do anything controversial when you tweet pictures of your puppy. >> right tough weekend for my puppy. >> i heard maybe we'll visit that pit bull with gunther. >> thank you coming up, the latest on the break through on what's causing the vaping illness that led to more than 30 deaths. former fda commissioner scott gottleib will be our guest and he'll join us to talk about that and the latest efforts to crack down on flavored vape. "squawk box" returns in a moment datadog has become the modern monitoring and analytics

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today marks exactly two months since health secretary alex a czar said the trump administration would act to remove flavored ecigarettes from the market including everything except tobacco flavor and then on friday president trump signaled that guidance could be coming this week there are some signs the administration may be softening its stance allowing menthol to remain that's a flavor, i think and potentially excluding vape shops from the flavor ban. meghan tirrell and scott gottleib vitamin e, something, there's more clarity on what's causing it, scott? a little bit more than that? >> that's right. it looks like it's the thc vapes, the cannabis based vapes. things are being added to the liquids. >> meg, i hear you on that one >> i do. there is a lot of news that's been going on and i'm excited to

talk with dr. gottleib about it, but in terms of softening potentially the order on flavored ecigarettes, if they do that, this would be a victory for advocates in the vaping industry many who would warn of a political push back. >> they want politicians to know that not only do they feel passionately about the products but they are voters, they are vapor voters similar to gun voters who feel deeply passionate about the use of firearms in the protection of themselves, these people will vote on that issue. >> so americans for tax reform is warned that a trump flavor ban may mean vapors may not show up to the polls in 2020 costing the vez votes in the 2020 race they have reported the trump campaign and gop groups have circulated that in a bid to get him to back off of the flavor ban. this comes as new numbers showing vaping among kids is still on the rise.

there are an outbreak of vaping-related illnesses in kids matt myers, president of campaign for tobacco free kids told us a weakened proposal on ecigarette flavors is bad public policy and bad politics for trump. this is an issue in which parents, including suburban moms feel is very important >> all right meg, thank you we're going to continue this conversation right now let's bring in our guest, dr. scott gottleib who is former fda commissioner. he's now on the advisory board and a cnbc contributor scott, the politics obviously sound pretty tricky. what's the science say >> it looks like what the kids are abusing are the cartridge-based products, giuliani, njoy they like the high nicotine content including giulianjuul it's potentially sound to carve

out the vape stores. that's what we were looking to do when i was at the fda at this point you really need to look at potentially pulling all of those cartridge-based products off the market. >> you're not even just talking about flavored, you're saying anything out there >> all of them juul in particular, you can't treat differently -- similarly situated products differently under regulation juul is a differently situated product. we have data showing that more than 50% of all kids who vape are using juul it's very clear that juul can't keep their product out of the hands of kids. you could treat that differently or selectively pull all of the cartridge-based products off the market if you wanted to carve out the vape stores which are selling the open tank vaping systems to adults. the kids don't prefer those products if you look at what's happening in the u.k., the u.k. has high

numbers among adults they don't have the same problem with the kids. the nicotine problem is higher the kids don't like the big con trap shuns >> you heard what meg just laid out. where do you think the administration is heading in terms of what they'll do >> it's hard to read the tea leaves if you look at some of the statements, it seems to be that they're skating towards a carve out towards the adult vaping stores we were trying to approach it by putting in place heightened age requirements the convenience stores wouldn't be able to comply with that. >> like what >> well, you'd have to physically restrict access you'd have to have a separate room where you card someone that goes in. only a store that's adult only would be able to restrict access in that way. that was before we had the 2019 national youth tobacco survey which showed another big uptick. the other thing you could do is you could say if you're mixing

liquids in response to an individual customer, like the adult vape stores do, that's permissible, but if you're pre-filling syringes for the cartridge-based products, that you can't do you can't pre-fill products in syringes for future sale but you can do it for an individual customer that would carve out the vape stores. >> scott, last week the white house advisor made comments saying they shouldn't regulate at all you had an aggressive stance as fda commissioner on tobacco. you wanted to lower the level of nicotine in combustible cigarettes what do you make about the administration backing off of tobacco altogether do you see them stepping back what you laid out as combustible significant ritz -- cigarettes. >> this was an important part of what i did at fda and i think there was no more single impactful thing we could do over any period of time than

dramatically lower smoking rates in the country which have declined if you look in the last two years. it's true we wanted to regulate nicotine to more potential. >> if you think juul should come off and they've removed the mint flavor which comprised 70% of the sales, this is an existential point for the ecigarette industry in the country. does this industry survive can they get back on the market if they're pulled off? >> look, the youth problem -- the ecigarettes can help currently addicted adults transition off of cigarettes i still believe in the notion of harm reduction, helping adult smokers quit combustible juul is almost single handedly destroying this. what's driving the youth use is

primarily juul. >> are they still marketing to teens? >> it doesn't appear that way. if you look at some of the historical marketing, i think it was targeted towards a younger secretary. they seem to have cleaned up what they're doing but it's hard to unring that bell and you've hooked a lot of kids kids now it's become sort of fashionable and they like the form and fashion of this product. it could be that this product can't exist on the market anymore. >> net-net, people get off people get on. net-net seems like more people are getting off. >> on to nicotine in. >> on to these things instead of helping people get off net-net it's not worth it. >> probably true when you look at the overall data. you do see smoking rates declining. >> we'll need a whole new generation walking around with steam coming out of -- >> that's the problem. the problem is all the youth use it if we didn't have this, this could be a viable segment. the youth use is driving us out of market. >> is there any data, i've looked for it, couldn't find it, of juul sales are children

>> i was asked that question before congress and what i said was that we had data when i was at fda between 10 and 20% but we didn't think that data was reliable enough to publish we never had definitive data on what percentage of juul's overall sales. at one point we thought it was between 10 and 20% i used that figure the new data that came out shows that more than 50% of all kids using ecigarettes are using juul we built into the 2019 survey a question what brand are you using? we put the different brands to the kids more than 50% are using juul you can back into how much of juul sales are to kids from that figure >> scott, it's great to see you. >> thanks. >> thank you for joining us today. meg, thank you. still to come on "squawk box," singles' day shopping spree. there are still several hours left in china's 24 hour retail bonanza.

alibaba is hitting a success it was sophie's big day. by the way, she's the next mozart. as usual we were behind schedule. but sophie's enthusiasm cannot be dampened. not even by a run-away donut. we powered through it in our toyota prius. because a star's got to shine, no matter what. it's unbelievable what you can do in the prius. toyota let's go places. servicenow put our this changes everything. you're right sir... everything. no not everything, i mean you're still blatantly sucking up to me gary. brilliantly observed, sir. always three steps ahead. six steps ahead. sixteen.

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welcome back to "squawk box," everybody. we have been watching the futures this morning the bond market is closed today for veterans day stock market's open though and it looks like at least now we

are looking for a lower open if we stay on this trajectory dow futures indicated down by 126 points s&p futures down by 12 and nasdaq down by about 39 points this all comes after all three of those indices set new records once again closed at record levels on friday. >> it is singles' day. the world's largest 24 hour shopping event ecommerce giant alibaba set a new sales record $30.5 billion. we're joined now from alibaba's campus i haven't asked you, we're all on record. are you single, argen? >> reporter: i am not single, joe. no, actually, i may have made a little purchase not too long ago for my girlfriend as well. >> i feel -- i don't know, i just feel like this kind of discriminates against people who aren't single.

i'm kind of -- kind of offended a little bit by it, argen. big sales. >> reporter: very big sales. that figure over $30.6 billion a lot driven in part by chinese consumers, a lot of imported goods, particularly american brands despite the concern there could be anti-american sentiment alibaba's good earnings, the chinese consumer remains pretty robust despite a slowdown in the economy. they continue to flock online and purchase these goods they're also big ticket items such as cars, other holiday packages on sale during the day. seems to be that it remains robust analysts told me earlier they're expecting that figure behind me to hit $37 billion as i mentioned, just over $33.6 billion. with about 3 and a bit hours going there's every chance of alibaba hitting that

right now back to you. >> this is what amazon -- the revenue amazon does in two months for the american viewers trying to comprehend how big this is, two months. >> you know what it reminds me of >> nba 500 how many -- >> 1.6 million people. >> 500, 600 million fans over there. how many people in this country? the market potential for china is just in sheer numbers unbelievable another example of it. still to come this morning, is the streaming field getting too crowded? disney plus about to launch tomorrow we're going to take a look at where the content in the streaming wars go next "squawk" will be back after a quick break. make fitness routine with pure protein. high protein. low sugar. tastes great! high protein. low sugar. so good! high protein. low sugar. mmmm, birthday cake! pure protein bars.

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prevagen. healthier brain. better life. welcome back, everybody. disney launching its highly anticipated streaming service tomorrow joining us to talk about the crowded streaming wars is howard owens. he's the founder and co-ceo of propagate content. that's a media production company that works with companies from apple to fox. howard, it's good to see you today. >> thank you great to see you, becky. >> so to this point you've

worked with everybody but is it getting a little bit more complicated? do you have to start choosing side to this point to the content? >> a lot of people are choosing sides. we're choosing to play the field on the streaming side. and it's been -- it's a great time for consumers right now it's a boom time for blue chip. great television so much opportunity for, you know, all -- every part of the family and as producers, it's also a very rich time because there's different kinds of content being made at the different platforms and, you know, it's just that rare moment that you can be as creative as possible and feel like there are unlimited possibilities. >> and unlimited cash, right >> there is a lot but the business models are changing >> how are they changing what are you seeing happening right now? >> well, as producers it used to

be that you could own a piece of the show and you would approach your distribution partner as a creative business and you would be part of that show for the life of it and if that show was successful 20 years later, you would participate 20 years later. now the model is changing more to a goods and services model where you're paid very well for delivering and rendering those goods and services but once those goods and services are rendered there's no real tail anymore. at least that's what the streamers are leaning into. >> why do you think that is? >> because the streamers are now, you know, big media companies of their own right and they want the ability to win tows their programming anywhere they want. you know, take disney tomorrow, which launches tomorrow, disney plus, you know, they have a broadcast network. they have cable networks and they are now going to have

disney plus. they also have cable channels and fx channels and "national geographic" networks they want to be able to window their programming how they see fit, whether it be on disney plus, whether it's on the channel. because of that, every time the show moves, they don't want to have to do a new deal with the profit participants. they want to be able to move those shows freely so that's why they're paying up front money but you're not along for the long-term ride. >> does that mean an end to the golden era of content or is this just kind of corporate governance and corporate policy kind of working its way into what's been a wild west at this point? >> well, hopefully it's not the end of the golden era of content. hopefully it's the beginning i think the deals are going to change and work out and for the producers who -- and the writers and directors who are strong and have great new original ideas, they are going to be paid very

well and you're seeing that across the board. so now it really is -- it's still a meritocracy. those who have the best ideas, the preshest approach are going to be rewarded, the rewards are just a little bit different. more up front now. so you're taking less risk but there's less long-term tail and opportunity. >> howard, i want to thank you for your time and as this develops we'd love to have you back and talk to you again >> thank you very much it's great to see you. coming up, retired four star army general david petraeus joins us we'll talk about hiring vets to global hot spots and social media spying "squawk box" comes back in just a moment

welcome back to "squawk box. it's veterans' day let's welcome general david petraeus in the last year, since last veterans' day how many >> over 15,000 the grand total now of the vets

that we're programming in terms of hiring veterans and their spouses, because we focus on them as well, is 77,600. >> that's incredible. >> it's a great program. >> thanks. >> how many employees overall? >> overall it's -- around the world it's probably around 8 or 900,000. we own well over 100 companies at any given time and have minority stakes in another 50 or 70 it's a pretty substantial portfolio. >> to be perfectly honest, i heard general mattis talk about how there was a stigma in hiring vets to me, i thought for me maybe i'm just sold on it. i would think it would be the reverse. i would think you would seek out guys that were vets and knew how to respond in situations that i can't even comprehend, me, myself. >> well, i'm with you. more importantly, our businesses are with you the businesses i think for a while thought it was the right thing to do to hire veterans now they realize it's the smart thing to do. veterans bring all kinds of

experiences, expertise, qualities, attributes. >> just being self-serving to the business, not being altruistic or -- >> absolutely right. now the key, what we're really emphasizing now is don't just give a veteran a job, provide a career opportunity there's a big difference the latter means that you invest in the veteran, you provide training, education, mentoring, focus groups, all of that to help that veteran truly be all that he or she can be. >> with that said, we are all well aware and it's heartbreaking that to get back into society sometimes it's difficult for veterans this -- one of the reasons, i would imagine, is because they don't have a fulfilling career at that point. so are you -- that can be part -- does that follow -- does that trouble ever follow them into the job i guess it's hard to get -- >> transitions are tough. >> yeah. >> you take off the uniform that has been your identity, you leave a community in which you all serve a mission that's larger than self and feel very

privileged to do that. that can be very jarring it was tough for me to take the uniform off even into such a wonderful job as director of cia. this is where employers can make a big difference it's how they receive veterans it's, again, helping them get into groups with other veterans and above all investing, training, mentoring, helping them have a career again not just a job >> general, my own father is retired u.s. army. he lost his leg in vietnam and works at walter reed with young men and women coming back with missing limbs or otherwise severely wounded are kkr's portfolio companies and generally corporate america able to help those people with truly catastrophic injuries? it's very, very difficult, but i've seen kind of firsthand watching the work my father and

so many other brave souls at walter reed, how important it is >> well, it's hugely important obviously it depends on the nature of the disability is there a function that can be done by these individuals? we see throughout society the answer to that often is yes. not in every single case clearly, but in many cases the answer to that is yes. and, again, employers have to make that effort of course, with unemployment at a 50-year low -- by the way, veterans unemployment is even generally below that it should be expected given that these individuals held jobs, tough environments, turned up for work every day, difficult enemies and circumstances, but those who have come home missing limbs or come home traumatic brain injuries, ptsd, all of these, again, society owes a great deal to them a va and medical system has to give and everything that we can possibly provide

and, indeed, our employers should make that effort and many of them are. >> we want you to give advice to china on how to handle this. that's not what i'm looking for. what should we be doing to try to support the protesters or -- you know, when the nba said something like that, you saw what the backlash was. what's the right approach for president trump, the administration, and americans with what's happening? >> well, it is a very delicate situation. we saw that obviously in the case of the nba tweet and then all the backfilling and so forth in the wake of that. >> right >> look, i think that this is an opportunity for china and for the government of hong kong to show that they honor agreements, and i think that's the approach that perhaps should be taken. >> what agreements >> well, there were agreements made for the transition of hong kong and now we need to see if those agreements will, indeed, be hon be in order i think that's a reasonable approach to this

and i hope, by the way, that in the weeks, months that lie ahead also u.s. and china can, indeed, resolve the differences and get the phase 1 trade agreement done obviously they now have to find a location in which to do that since the meeting will not be held in china. so, again, with that worked out, that can help this relationship move forward this is the most important relationship in the world, that between the u.s. and china it's not just the most important to our two countries, it's the most important to our entire world. we are naturally and understandably strategic competitors. we have to acknowledge that. but this should be a relationship that can and should be as mutually beneficial as is possible. >> complicated relationship for american business. >> very complicated. >> american business has been left to navigate it on its own these are markets that we've pushed into but do we check our own sort of sense of what's right at the door and bring it

to the party >> and extend the conversation to saudi arabia. same discussion. >> first of all, coming back to china, this is a market 234 which we are very active we are the biggest firm throughout asia, including china, japan, india, the three big economies there. we have learned how to navigate it there are themes in the wake of the milk scandal why don't we help chinese businesses pull together the biggest dairy conglomerate so they can have milk that they believe in. >> you didn't go to saudi arabia this year? >> no. i had a board meeting. i pulled out of last year. >> you have to deal with saudi arabia, too, or do we? >> look, i think the big -- the big issue, in fact, for the kingdom of saudi arabia and for vision 2030, which by and large we should want to see succeed, we very much want to see the path of reform continue. along the path there have been these divergences that have

caused real reservations by business leaders not the most recent of which has been the gruesome murder of khashoggi. >> spies on twitter. >> certainly so, again, look, the kingdom really has to look deep within it and ask can we -- what do we need to do to regain confidence of investors because vision 2030 relies on outside investment that's why this limited ipo of aramco was so important. they have to get outside money they cannot do it just with what they're generating from the export of crude oil. it's well known. their sovereign wealth fund is down $500 million. go through it at 50 to 60 billion a year depending on the price of brent crude, they cannot continue that forever. >> they're kind of an offset to iran not a great choice, but think about it. >> by the way, you just highlighted one of the features of the middle east the enemy of my enemy is not

necessarily my friend in all cases. we should want saudi arabia to succeed. >> right. >> we should be giving them advice and assistance and so forth -- >> right. >> -- but that has to be fairly forthright with it i have offered some of this to very high ranking individuals in the government that's the corner stone or the keystone or whatever of the gulf region and really beyond >> exactly. >> their influence is huge, and if they can go down a path of moderation, which is generally where they're headed, women driving, no longer having a guardian rule for women and so forth, that would be very, very helpful in the region and indeed in the world >> general petraeus, thank you for being with us, especially on veterans' day. >> great annual tradition we have thanks to all the veterans who are out there and who will be honored on the streets of new york today. quk x"omnel., gera "sawbo cing right back datadog has become the modern monitoring and analytics

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markets set for a pull back. investors have conflicting signals on a u.s.-china trade deal. >> violence flares in hong kong. and a familiar wall street executive weighs in on the wealth gap.

>> there are solutions to these problems the problems are real. it does not mean free enterprise bad. >> we'll bring you jamie dimon's new comments on inequality in america as the final hour of "squawk box" begins right now. good morning and welcome to "squawk box" here on cnbc. i'm joe kernen along with becky quick. our guest host far point chairman, ceo tom farley good to have you here. u.s. equity futures no reflection on you, i don't think. down 132 points after being up just about every day for the past month welcome, tom smile or something anyway, down 13.5 on the s&p and

the nasdaq indicated down over 40 the bond market is closed for today. that's 194 it will be interesting i don't think 2's bad. 3 might be scary are you seeing the shift >> yeah. >> oh, my god, we're too low. >> too high. >> yeah. >> 2 is historically low. >> so low, isn't it? >> just that we were at 1.47 >> right >> not unfairly. we pay a lot of debt service >> what does that mean for conditions looking to refinance? 3 could be worse and 3 is historically low. >> on a relative basis. >> do you think we're getting to 3% is this a conversation we need

to worry about >> i hope not. we saw that last year. well before we get to 3 we'll begin to see problems if this continues in the same direction. i want to be clear let's not start extrapolating that we could be headed for pitfalls after this massive blowout you've seen in the last few weeks. >> after 3 comes 7%. >> 7 would be bad? >> rashir is here.

let's get you caught up on stories investors are talking about today. new violence police there shot and wounded a protesters who is reportedly hospitalized in critical condition. they fired tear gas in the central business district as office workers crowded the pavement and protested the china-backed government there. earlier this morning hong kong leader carrie lam said the violence has exceeded calls for democracy. apple's credit card agency is being criticized. a tech entrepreneur and apple co-founder steve wozniak posted tweets saying that their wives got much lower credit limits than they did. goldman sachs which partners with apple in issuing the card issued a statement saying it does not figure in based on gender alibaba is on a record sales pace for singles' day.

this is the world's largest 24-hour shopping extravaganza. the pace is seen likely falling short of year ago levels this is the 11th year that alibaba has held singles' day. stocks to watch this morning. boeing 737 max jet has been taken off flight schedules for both american and southwest until early march as they await the return to service of the still grounded jet and xerox is offering computer and printer maker hp four weeks of mutual due diligence, according to bloomberg, to a report and it comes after hp acknowledged that xerox had approached it about a possible business combination. president trump ended last week by throwing some cold water on hopes of a trade deal with china. over the weekend we got some new comments from the chinese side as well. kayla tausche joins us she has more on that front good morning. >> reporter: good morning. the white house is hoping to have a phase 1 deal by the end of this week

president trump said friday there was no agreement on removing certain tariffs and it's possible that part of the deal doesn't happen this year. it casts some confusion on a process that the chinese have viewed as fairly straightforward thanks to president trump's tweets the country's former vice minister said in an investment forum on friday, quote, he makes the u.s. decision-making process efficient and transparent because he basically says what it is. the pros of having president trump outweigh the cons. they're still hashing out an agreement the u.s. side had already reached about a month ago. several items are competing on the calendar for the white house. the impeachment inquiry going public government funding running out in ten days and a narrowing window to take up the new nafta. for now, china is what the market is watching and it is a critical week on that front. becky? >> kayla, thank you very much. for more on the u.s./china trade talks and their impact on the markets, let's welcome once again, rashir sharma

rashir, what do you think? where are we in termsof the trade talks and what does it matter to the markets? >> the markets are discounting a lot which is the data that we are now in a trade truce because of the feeling that president trump needs a trade deal before the next election. i think what really happened this august was quite significant in that the escalation of the global trade war led to a rapid rise in recession fears. i think that message really got to the white house and president trump. he's very sensitive, as you know, to what happens to the stock market in particular i think that we are basically now in a trade truce more and i think that that sort of risk for now seems to be out of the way the market is largely pricing that in. >> having said that, if you think this is something he's worried to do, what do you attribute his comments to last week at the end of last week he didn't sound like he was desperate for a trade deal >> i think that's the usual back

and forth in terms of what's going to happen to trade negotiations i think there is a bigger picture here which is the fact that we are in an extended period of a trade war but i think that for the next 12 months or so we are in some sort of a trade truce so it's like the sort of cognitive dissonance you're going to hold both parts in your head if you have an extended trade war for the next 12 months, we are likely to see more of a trade truce than an escalation in the trade wars. >> the next 12 months happen to be between now and the elects. you think this is all tied to the election if president trump wins the election, the gloves come off again? >> no matter who wins. this sort of escalation is bound to continue in terms of what matters. you can sense the public sentiment as well. the u.s. and in china. there's a fundamental means here i don't think it was going back to five or ten years ago this is not about trade. this is about technology that's where the battle is going to be fought that's what is also something that china's relying on much more in terms of its attention

the u.s. realizes that's a vulnerability in terms of where that is. >> you're talking about huawei, zte, all of these situations >> yeah. you think those security concerns are legit and maybe more importantly will they stand if there is a trade truce? >> that's right. i think that it's sort of battle going on now we have force from tariffs but the tech war is acting in parallel i feel as far as president trump's concerned his incentive is to try and count things down. after that, no matter who gets elected, i feel that we see an escalation on both the fronts, particularly on the tech front. >> do you think that china intellectually in terms of everything, the infrastructure of the higher education, are they ready to do things on their own? and if so, could they go hand -- i mean, could they match us technologically in ai and all of these burgeoning industries

right now? do they have the wherewithal or do they still need to steal? >> i was there -- >> what would you call what they do now you think borrow is a better word >> i was there in china like a couple of months ago and i think we had this discussion earlier, too. what really strikes me there is the scale of the consumer tech revolution happening on the ground out there >> right >> i've not seen anything like that in terms of going into the department stores and you see the way the entire thing is run by technology. you see drone deliveries taking place out there. >> in ai they're ahead of us in some wasys. >> is that true? >> they have so much data where they don't have a problem taking data from everyone who walks by and they're able to get ahead. >> no, i think it's very dependent as far as some key industries are concerned they're concerned about what's happening to huawei and they are dependent on the semiconductors, chips, et cetera i think it's the same thing going on they're vulnerable at one hand

on the other hand, the consumer tech revolution is happening >> has our market factored in even if there is a trade truce here, we may be going toe to toe with security concerns has that been factored out and worked into market prices in our stock? >> no, i don't think so. the fact that the market gets surprised just tells you that we have this very long period of deglobalization. the deglobalization is not just about trade, it's got to do with technology as well it has to do with capital flows as well. that's a risk that's rising as well, what is the regulation out here it sort of prohibits american pension funds and other institutions from investing. that risk is also very real. it's a multi--pronged sort of battle going on and i think this battle is set to continue after the election is over. >> rashir, thank you for coming in. >> great, thanks. the phrase goes, don't fight the fed. well, it appears consumers might not be listening and our next

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this should be a key moment for the american economy we're just one year away from the 2020 presidential election some new data out this morning is leading to questions of just how important the economy will be in next year's vote contessa brewer is here. she's got more on this right now. contessa, good morning. >> reporter: a new cnbc acorns invest in you survey finds a majority of americans say the next election is mainly about issues other than the economy. for the younger generation, the environment and education outrank jobs and the economy for the older generation, 65 plus, top priorities are health care and immigration still, 79% of those who responded say it's important to support a candidate whose policies will help improve their personal financial situation none of the top three democrats appear to inspire much economic

hope, even among democrats biden has a moderate lead over sanders and warren, but more than half of respondents say none of these candidates makes them more hopeful about their personal financial situation than a second trump presidency worth noting. >> the survey was conducted before michael bloomberg announced he's considering a run for the presidency for more on the survey go to cnbc.com investinyou invest in you ready, set, grow investors in aacorns the candidates need to pay close attention to this. for younger generations to say that the environment is their number one top priority and for older americans to say health care is, means that what we normally pay attention to maybe is changing somewhat

>> as we get closer to the election, it doesn't come down to the same old mantra, it's the economy, stupid. >> farmers who are on the verge of losing their farm and i say to them, hey, we're in trump country. does this influence at all how you see the next election? no i'm going to support trump it doesn't matter that his policy has hurt me personally, i'm going with this guy. and that's something that i have not seen in previous elections i've covered quite alot of them. >> you have to vote to express your environment and passion to go to the polls. >> and will those young people >> no. that's what i mean >> no, they never do they don't show up. >> everything you're saying about the survey is helpful to trump. environmental policies, they don't vote take them off the table. older people are worried about health care. medicare -- they vote and medicare for all makes no sense. i don't think people are going to fall for it. >> early and often. >> he's talking about

immigration. when you take all voters into consideration, immigration is number two on that list and it almost matches the concern for the economy. >> thanks, contessa. joining us now to talk more about this as well as her new op ed titled many americans are fighting the fed, good for them. is sheila bair, former fed chair. great to see you >> nice to see you >> chairman bair i have a mixed viewpoint here. you're gratified that a lot of people are sort of saving for a rainy day and prepared for a downturn, whereas, the fed doesn't seem to be in that same camp i sort of say that people are still very, very affected by what happened ten years ago and i hope that doesn't keep them out of, you know, they're so risk averse that they don't participate in what's happening in the stock market right now. you're happy that they're not as freewheeling as the fed about their finances.

>> well, yeah. i think it was more focused on consumer spending than their own personal finances. i think, you know, people should be in the stock market long term i don't think people should try to time the market beings especially retail investors. i was more focused on the trend to cut back a bit on debt. cut back a bit on spending save a little more i think, yeah, that's prudent. the likelihood of recession is not insignificant. certainly a slowdown next year i'm glad they're doing that. monetary policy, deciding to get people to borrow more than spend more they're not doing that i think that's a good thing, yes. >> that's the fed. you have the federal government itself not exactly -- >> well, that's true >> not exactly being spendthrift and prudent. >> no. it would be nice to see some of that prudence on the part of the federal government, that's for sure >> what do you think we would need in terms of dry powder for

the inevitable next slowdown is that going to be a problem in your view? >> well, i think it is it's hard for me to see how this ends well if we get into a downturn, if we get into a recessi recession. we're going to be fiscal stimulus i don't see how that happens other than monetizing the debt the fed is buying 60 billion in t bills a month now which has helped invert the yield curve. maybe that's positive. maybe it's confusing market signals, but it's hard to see this massive amount of debt if the market's already having trouble absorbing, going to increase if we need fiscal stimulus, which we will. the fed will have to monetize it again, longer term that's not a good trend at all. i don't see what else they're going to -- do quantitative easing again >> what do you make of the geographic center of the democratic party right now whether you want to talk about elizabeth warren or bernie sanders. is that a winning argument that

you are seeing how did we get here in terms of all of the -- >> yeah. well, it is -- it is certainly a much more expanded government role some of their things resonate with me. i do think we have a rigged system in the sense that a lot of our tax policies are skewed towards very wealthy, you know, people who get most of their income through investment. so i think attacking some of this root causes would be a good thing. i do think the system is rigged. i think bailouts of the type we did in 2008, 2009 rigged the system it propped up the banking sec r sector, it propped up monetary assets it didn't do much for homeowners economic recovery covered by this is not robust we're seeing wage growth i think relying on monetary

policy, the tax code skewed towards investment income, i think those kinds of things do favor the wealthy. we need to grapple with them i'd like to focus on the root causes as opposed to going after billionaires i don't think that should be personal to anybody. i think they need to acknowledge that part of the reason they were able to accumulate wealth is because they do get very favorable tax treatment and treatment in terms of monetary policy driving the economy and the impact that has. >> when assets get marked up in low interest rate environments, people that own the assets -- >> and they're -- they are them, that's right. >> positive things happening at middle income people. >> there are, yes. >> where the employment rate is as well. >> it's great to see. >> anyway, i mean, your name is chair bair it sounds funny when you say it. is it okay it's still okay? >> yeah, it's fine sheila's fine, too we've struggled with that for years, joe >> i'm going to go ahead and say

it you are chair bair thank you, chair bair. >> nice being here thank you. when we come back, one of the richest ceos on wall street weighs in on a heated debate over wealth inequality we'll bringyou new comments from jamie dimon "squawk box" will be right back. don't forget to subscribe to our podcast. you'll get interviews, original content, and behind the scenes access look for us on apple podcast or on your favorite podcast app and subscre sawpotoy.ibtoquk d da

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benioff reported that a light in the world has gone out calling bernard a special inspirational leader someone that a lot of people have really mourned. peter lee, the head of cover california, that's the exchange in california, probably put best he said, you know, bernard really walked the talk >> yeah. >> a good friend here on "squawk box. hard to imagine he was only 60 years old. >> only 60 they didn't talk about the cause. he's survived by his wife and three sons. >> his lovely wife, denise really lovely. >> yeah. lovely family. the board did name the executive vice president greg adams as the interim chairman and ceo but he's got very, very big shoes to fill. >> we'll miss bernard. bertha, thank you for that appreciate it. coming up, jpmorgan's jamie dimon says the american wealth

gap needs to be solved we'll bring you the details of what the bank ceo said that's coming up next. still to come, what the story of two former twitter employees accused of spying for a foreign country means for the biggest names in tech. facebook's former head of security joins us with insights in just moments. stay tuned you're watching quack b"squawk cnbc ♪ ♪ ♪ ♪ ♪ ♪ ♪

welcome back to "squawk box. here are some of the stories if you can tell by the music, some very important stories that we'll be talking about today moody's has turned sour on the global outlook. >> company man. >> that's me, for 2020 the credit rating agency cut its outlook from stable saying disruptive and unpredictable world politics will increase the risk tesla shares are moving higher in pre-market ratings. jeffries has raised it from 300 to 400 they're consistent with sustained profitability. blackstone group is taking a majority stake in magic glad the parent company of dating app bumble and badu. >> bumble.

>> really? >> yeah. >> okay. >> so do we. we've had bumble on here. >> bumbler because of the producer we know that's on it. total bumbler. kidding. magic lab is profitable and has annual revenue growth. when he talks about it bumble bumbler. >> that was it that was good. >> that's for people like him. not like some of the other ones where -- this is where they might even take me in bumble if i were ever single on singles' day. >> pleased that you weighed in on the music you asked me to. >> no, you're a company man. >> am i not with you you asked for my help, i'll help you. >> thank you appreciate it. jpmorgan chairman and ceo jamie dimon waded into the wealth on a clouded debate on "60 minutes. jpmorgan's board decides what he takes home but there are other ways to try and close the wealth gap aside from cushing executive

pay. >> executive pay, last year you were paid $31 million. too high >> the board sets mine i have nothing to do with it. >> you can return some of it. >> i could is that going to solve any of those problems. >> i don't know. >> i'm going to leave it to the board to set my comp. >> you've answered everyone of my questions but this one you're fobbing off. >> the board has to do it. >> let me ask it in a general way. should executive pay in this country be curbed? >> what does that mean >> cut back. should there be a way to say, we're not going to have such a spread between our workers and the guy at the top >> you know, when you say something like that you have to say, how are we going to do it does it make sense i think you use the tax system i would not have taxed the rich, i would have spread the earned tax income joining us to talk about all of this is seth hanlon he's the center for american progress action fund senior

fellow also, michael strain who is american enterprise institute's economic policy studies director let's talk a little bit more about this seth, what do you think? is the way to curb inequality to bring the top down >> well, we can certainly tax the top more i mean, i think our tax system fails a lot, not with ceos but super uber wealthy people who are in many cases paying a lower tax rate than people in the middle but absolutely it's not just about bringing the top down it's not about bringing the top down at all. it's about raising more revenue, having a fair tax system and investing in people in the bottom and the middle. >> are you talking about changing rates on income or are you talking about overall? a lot of the wealthiest people earn their money -- they pay capital gains taxes but that's a lower tax rate right now than they would be paying if it was just earned income. >> exactly it's more -- not -- mostly about not the ordinary income tax rate but capital gains and not just capital gains tax rate but also

the capital gains tax base right now super wealthy people if they don't sell their stock they can accumulate massive wealth i'm not talking -- >> wealth on paper wealth on paper. you're talking about forcing them to pay a tax even if they haven't realized or recognized those gains yet? >> that's right. i think when you're talking about super wealthy people like billionaires, they enjoy all of the benefits of their wealth you say it's on paper but in essence all wealth is on paper they can borrow against it you know, they can straddle with losses there are many ways to avoid taxes but i think that's the big -- the biggest problem with our tax system right now is that super wealthy people can accumulate in some cases $100 billion while paying virtually nothing. i mean, none of that income shows up on their tax form. >> michael >> well, i am happy to hear seth say that the problem -- that the goal shouldn't be to bring down the rich that's not what -- that's not the sense you would get if you

were listening to the public conversation, if you were listening to many people on the progressive left the argument seems to be that the wealth gap in and of itself is a problem the income gap in and of itself is a problem we need to shrink that in order to curb their political influence, in order to not have an oligarchic society or something like that. i actually find myself in broad agreement with jamie dimon and with some of what seth said as well the goal should be to advance economic opportunity for low income americans, for working class americans. that's going to cost some money to do that we shouldn't borrow that money we should redirect current spending, perhaps we should raise revenue but the goal should be to lift people at the bottom up. the goal should not be to tear people at the top down. >> i think those are really excellent comments i get the politics of going after billionaires you know, it has the benefit of kind of hiding the ball a little bit about all of the spending policies that when you add them up altogether they reach a

ridiculous level we started out by talking about jamie dimon. jamie dimon makes $31 million. there were three pitchers that make $31 million jamie dimon runs the largest bank in the united states by assets, second in employees, 200,000 employees. he has done a fantastic job. he is worth every penny of $31 million. i'd rather it be in his hands than the federal government's hands because i'm certain that jamie dimon plows it back into philanthropic causes and otherwise makes productive use of his capital. >> seth, lesley stahl probably makes 50 to 100 times what the average cbs worker makes do you think that tv anchors that not even write their own questions, should there be a pay cap on tv anchors like that would you think? >> i don't think there should be a pay cap but there should be steeply progressive taxes on people who make tens of millions. >> if i would have been jamie i would have asked her that question. >> what is jamie worth how much should jamie make a

year >> the thing with jamie dimon, i don't know the board sets my pay. who -- you know, like he has absolutely nothing to do with selecting the people that are on the board. i mean, i know that, you know, we have some independent compensation committees but like ceos choose the people that are on the board and those people recommend the -- >> who would you say >> the idea that this is like a purely market transaction i think is a little bit shady. >> you're right. that's below market. jamie dimon can leave jpmorgan tomorrow and he could make $150 million a year doing something else and jamie dimon does not select his board, that's wrong the board of directors of jpmorgan chooses incremental additional board members of jpmorgan. >> look, it's a thin market and the market for ceos is -- there's not a huge supply of potential ceos and huge demand for potential ceos

you have to rely on the idiosyncratic factors. i think any system where you were trying to tie the pay of the ceo to some sort of ratio between ceo pay and average worker pay just seems a little nutty to me. i don't see why that would get us closer to a socially efficient or socially optimal outcome than having boards of directors. >> michael, there's actors that make $25 million per movie. >> sure. yeah yeah yeah. >> where do we start capping which -- do we start -- i mean, i think jamie's probably more important than leo kind of i mean, i love "once upon a time" in hollywood. >> "titanic" was good. >> that was a long time ago. >> yeah, sure. >> bad ending. bad ending for almost everyone, especially for the guy that went into the boat with all the women. >> yeah, that was-- >> horrible. >> sad moment. >> that guy. bad news anyway -- okay

thank you. i just don't know who we -- i'm looking at you, new york stock exchange you and grasso. looking at you, pal. >> you said it earlier if you have a crony board with management to the detriment of shareholders, let's go get them. jesse from elliott is going to give them a phone call. >> it is difficult because we had the cash compensation didn't work, then we went to shareholder -- to stock compensation then you do the every three months you're trying to juice the stock because you might have -- so you do have to watch for unintended consequences that make you do seven things based on your own -- >> short termism versus long termism. >> that's fair. >> and a fair tax. >> buy backs, you do buy backs you lower the float so the earnings per share goes up there's ways that you do it. i'm talking about the general idea that you're going to say, you know, the best baseball player only makes, i don't know. how do you even begin to do that i don't know. >> tell you guys about some breaking news out right now. we've been keeping an eye on

shares of walgreens boots. those shares are up after a report from bloomberg that says kkr has made a formal approach to walgreens on a record buyout. you can see that stock is at $63.53 that's an increase of 7%. if you go back to even october 31st, that stock was trading as low as $54.78. rumors about a potential buyout happening have pushed that stock substantially higher i think they traded on tuesday, november 5th tuesday of last week they were all the way up at $61.21 again, kind of renewing all of those ideas that had been out there, those rumors that had been out there about a potential buyout this is a report that says that kkr made a formal approach for a leveraged buyout with walgreens. keep in mind, walgreens is a $52.8 billion market cap company. that's before you see the gains today. >> when this came out a week ago, i fooled around and tried to understand what the equity

account would be. >> right. >> the chairman owned 16%. if you assume he rolls, my math, which i only know enough to be dangerous, was they would actually need fresh equity of something like 15 billion. this is not just kkr there's no way this has to be kkr with their largest lps perhaps, a gic or saudi arabia i can't imagine kkr unless they were going to raise a one-time fund for a particular deal would be doing this alone. >> this would be the largest private equity deal by double in terms of enterprise value. also point out the largest lvos have not done well if you remember txu is the largest ever did not go well at all the number two was first data which was ultimately a huge success story but at one point before frank came in, it looked like it was going to be wiped out. >> first data, what was that, 20 years ago? >> about 20, right no, this is a new realm. this is a new realm.

this puts a lot more businesses in the sights if this deal is actionable i bet some private equity analysts are redoing their screens. >> elsewhere there are growing concerns over insider spying at social networks. last week federal prosecutors charged two former twitter employers with spying on users on behalf of saudi arabia's government the next guest warns there's more to come joining us is alex stamos, he's nbc news cyber security analyst. that sounds ominous. what do you mean more? give us some insight into the worst case scenario. really make it bad for us. it's cable >> hey, good morning so i think one of the things we need to keep in mind is that a number of american companies and now including the tech companies have become the front line in the battle between the united states and its adversaries from both an economic espionage but a

human espionage battle and, you know, these kinds of things that you used to see of other countries trying to turn spies within u.s. defense contractors, within government agencies, it's now the tech company's turn because of the amount of user data they have globally and the fact that like in the twitter example, that they are the platforms by which people communicate about autocracies. the only safe way in some of these countries that you can talk about how you dislike the government, your desire for the democracy and the like is on american tech platforms. that means these companies have a real moral tendencies can't suppress them at home. >> trying to figure out the right path, alex i can see -- i'd have to ask myself which way i would want to err. would i want to err on the wild, wild west and don't -- you know, we're all adults, don't hurt

innovation or i don't want us to become china i don't want to look -- i don't want us censoring things and baby feeding all of us to what we can handle either so, i mean -- and the other thing is shouldwe -- should we try to anticipate the bad things that are going to happen and regulate beforehand or do we let these things blow up in all of these different areas and say, i guess we should have thought of that and then do it? i don't know which side we want to err on. >> i'm not sure there's a good regulatory path here first off, these companies have no desire for their employees to be threatened. i do think there is an alignment in interests between the large american communication platforms and u.s. interests in this case. i think it's up to the companies right now to think about what kind of data they hold and what kind of access they have internally for a long time in silicon valley the model of building up engineering teams has been to

allow them to have access to almost any data so they can be really efficient and innovative in their work. i think that model is going to have to change because it puts employees in a really untenable position, especially those who have families who live in these countries. there's a number of autocracies who have no compunction in leaning on people's families as a point of leverage. i think the first work has to happen there i'd like to see some acknowledgment in different parts of the u.s. government that the domestic u.s. counter intelligence work that they've done for decades has to extend into understanding the way these companies might be infiltrated there are a lot of things that private industry can't do itself. >> am i naive to be particularly disappointed in understanding that saudi was spying on u.s. soil in a u.s. company given our relationship with saudi, given the education information, the weapons we sell them, the intelligence we provide them

>> yeah, i mean, i guess i wouldn't be surprised that the kingdom of saudi arabia is a frenemy of the united states through all of the actions of the current crown prince, mbs, they have demonstrated that they are not really reforming towards democracy like was advertised, that the primary goal of the saudi royal family is to stay in power. obviously the horrible, horrible actions against jamal khashoggi demonstrate that so i do think -- this was interesting. now what was kind of surprising here is of all the countries that have the ability to spy on the united states, the kingdom of saudi arabia was not at the top of anybody's list. the top is generally considered obviously the russian federation and the people's republic of china. the fact that the first big case of this was saudi arabia i think indicates that we should b concerned about countries that have i much longer history of spying in the united states and being able to pull off the same

kind of thing. >> alex, we've got to run. we appreciate it i like that shot >> yeah, next door, actually >> yes yes. good to see you. thanks >> thanks. >> we're on a first-name basis >> yeah. >> i play golf -- >> augusta >> i don't know what you're talking about there. >> good answer no idea. >> when we come back, top stocks making moves ahead of the opening bell we're going to talk about deploying your money smartly with markets setting record highs almost daily maybe not today. right now it looks like the dow down by 122 points s&p futures down by 14 nasdaq off by 37 we'll talk about much more when quk x"om rhtack.

welcome back to "squawk box. the futures this morning pointing lower across the board today. that's a little unusual given the direction of the markets lately

right now dow futures indicated down by 1 20 s&p futures off by 13, the nasdaq off by 37, coming off record closes on friday. joining us to talk markets ahead of the trading week is liz young, director of market strategy at bmy melon investment management is this just a little bit of a pause or what is really affecting the markets today? >> i think it is a little bit of a pause here and the markets can continue to grind higher through the end of the year if we keep getting positive rhetoric on trade, we keep getting news on trade that looks good, one of the things that i think could actually surprise the markets positively big into the end of the year is if we actually get a trade deal. that's what we're still waiting for. >> does it matter about the details or any trade deal that says this is a truce if things aren't going to get worse, maybe in the future that would be an option. >> i think the market is pricing in a truce if we don't get a trade deal at all, that's going to be a pullback.

>> a couple of things that the market has been so focused on, first is earnings, the second is the fed. earnings have been fairly decent, what do you anticipate for earnings next year. >> you have to define decent earnings scaled a low call -- >> decent compared to zp ed td o expectations. >> the number of companies that beat is higher than normal the magnitude they beat by is lower than average we didn't beat by anything that surprising we had more cups that underpromi underpromised. as we move forward and earnings expectations are higher, it is going to be tougher to scale that wall and anybody that misses i think is going to get punished more than beats would get rewarded. >> next year, earnings projections are about 8% growth. year over year and forward pe is 17 that's not cheap if anything is that 8% going to materialize or are we going to see that 8% end up being four, five, six and

that's why we're trading >> usually you see earnings expectations come down as we get closer and closer. i would be happy with anything about average and average over a long term history is 6.25% growth if we can stay above 6%, that's good for the market and the valuations are fair. below that, we'll see the market get disappointed by it. >> do you have thoughts on european stocks. it feels like things are getting a little better. is there any catalyst you can think of where we can see european stocks catch up >> it does feel like things are getting better what i heard a lot of clients say europe is cheap, so we should buy now that doesn't mean it can't get chea cheaper. we need some head winds to come off. ifp that has, i think the european market gets surprised positively and then see a little bit of a comeback in 2020. >> thanks. >> with that, ten year today at 1.95%, that's a long way that we

have moved very rapidly hi lly on yields, does that concern you? >> it doesn't concern me i think it is good news. the yield curve has been steepening since the beginning of september the steepening of the yield curve doesn't get as much press as another curve does. financials have run very kawhi lit kind of behind the scenes for that whole period. i think a ten year that continues to go up is good for the economy. >> liz, thank you. >> thank you >> down to the new york stock exchange on this veterans day. jim cramer, you had a jump on veterans day you -- that was cool, out in -- >> thank you that's an academy that is joyou in the sense that there are people there who were so happy to be there. it is just an amazing place. we had a show where there was more sophistication about the

stock market than any other place i've been to in all the other places i've gone they're fascinated by the market and they're interested in everything from tesla to micron. i was surprised. a fabulous place, so many great young women and men. >> they do a military air force type boo-yah for you all at once >> yeah, they did. at the lunch room, i think i would count that also, when we did our show, one thing i went to see -- they wanted me -- they wanted to know if i wanted to jump from a plane. i think they're being facetious. i went into the plane they jump from, it is a tin can. i think i would feel safer jumping than being in the thing. >> it is a good point too. no reason to -- no reason to jump, right? probably going to land okay? >> everybody has to jump the first jump you can't be holding on to someone. the first one you're out there, these people are special they're tough. and i just -- again, there is a

great feeling of camaraderie and excitement there just -- it is an exciting place and colorado is exciting. >> it is beautiful they are different i mean, i was in a really deep bunker the other day, it was pretty harrowing that's about it for me and, yeah, that's as scary as i want things to get jumping out of a plane jim, thank you i was in a bunker a couple of times. anyway, we'll see you in a few minutes. to keep me moving the way i was made to. it nourishes and strengthens my joints for the long term. osteo bi-flex - now in triple strength plus magnesium. will it feel like the wheend of a journey?p working, or the beginning of something even better? when you prepare for retirement with pacific life, you can create a lifelong income... so you have the freedom to keep doing whatever is most meaningful to you.

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a final check on the markets before we hand things over to "squawk on the street. we have been in the red all through the course of the morning. dow futures still indicated down by 125 points. nasdaq off by 38 s&p down by 13 that does it for us today. join us tomorrow. >> we'll be here. >> tom will be here. >> unless andrew comes running back >> thank you to all the veterans. >> thank you to the vets ♪ good monday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cram cramer, david faber at the new york stock exchange. stocks will take a breather at the open, dow futures down about 125 across after a record high across the board on friday fifth straight week of wins for the s&p. you got trade uncertainty and violence in hong kong top of mind europe is red. as i