good morning, everybody. welcome to "squawk box" on sn. we are live from the nasdaq marketsite on times square yesterday, the dow and s&p closed higher. nasdaq was off by a few points the dow helped by disney disney has had 10 million subscribers already signed up. that stock up by about 7% yesterday. now going to see that the futures are under a little pressure dow jones down by about 17%s s&p off by one nasdaq down by 11. a lot to talk about including the trade war. treasuries this morning, 10-year

trading at 1.85% >> some people saying the bond markets is responding to what is happening with china trade stock market hasn't. update from hong kong, protesters have paralyzed the city school has been canceled protesters blocking a tunnel the tabloid global times tweeting the hong kong government expected to announce a weekend curfew that tweet was later deleted new data from china, industrial output grew at a lower rate than expected fixed asset investment year to date the lowest since 1996 retail sales rose 2.2% falling 7.9% that was expected that matched the 16 year low hit

back in april. auto sales in china fell for the 16th straight month. >> an update now discussions hit a snag over farm purchases. china agreed to buy up to $50 million in pork and soybeans china hery of the commitment in that text. also resisting to curb tech and enforcement mechanisms >> this will be interesting, it is not just the agriculture al number we are looking at but the idea of tech transfers that will be a much bigger sticking issue particularly with the u.s. business community that's what they've been hoping for. >> can't even get the skinny, skinny deal done >> okay. what's happening over here >> i have things on my elbows

that are banging against these >> i see that. they are like laces. >> we have arm chair things. >> you can't go without those. what are those why? >> they are bling. leave me alone. >> did you have to tie those >> no. they came pretied. >> we have to get a shot to see what is going on >> there are these things on here >> they are going to ask us to move on even thoughs it 6:00 a.m. it is clicking it is kind of cool >> it is a little bit of pipping but it has ornamentation >> we could take shoe laces. >> you know what it would do for us highlight our guns >> let's see show them off.

>> okay. >> what do we say about elizabeth warren >> launching a new attack on billionaires actually buying commercial time here on cnbc to air a campaign add that aims at lloyd cooperman and others >> it is time for a wealth tax in america i've heard there are some billionaires that don't support this plan. >> the vilification of billionaires is bull >> he recently sent her an open letter claiming her treatment of him was like a parent chiding an ungrateful child he said he would be happy to sit down with her and have a conversation leon will be responding today.

he'll be on the half time report at noon eastern. his comments have gotten spun into the broader universe. >> couple of things, this ad they are buying on cnbc, i can't imagine they are buying the ad to persuade the audience they are buying it on cnbc so that it can run on cnn, msnbc and fox and get lots of coverage we are covering it it's being covered on all the other networks number two, they are taking shots at leon cooperman who has been on our air. lloyd who was on air recently. i'm surprised they didn't take the bill gates video yet

>> her campaign site is now saying a snarky ad are you a billionaire? the answer no. then a special link for the tax and a link for every rich guy who have said anything jamie, bill, jeff bezos. >> lee cooperman wants aggressive taxes >> lloyd, i argue with him all the time now they are trying to eat their own. >> she's trying to make sure to one speaks out against her >> initially, if you want to reach billionaires you advertise

on cnbc. i don't know where to come down. if you want the highest demo audience that's why all of the luxury goods makers advertise on cnbc >> she's trolling that class >> she's doing it because of the echo chamber >> here we are talking about it. >> i do think the shots she's taking for the most part against these individuals for the particular people she's chosen i could make a list for her if she really wants >> of the greedy bad billionaires who? >> she's chosen carefully anyone who has said her plan is a excuse >> which ones don't give it away >> warren buffett has a great line -- what is it

criticized by category not by name we've had all sorts of guests that have argued in favor of the carried interest a lot of them have philosophical views. with self-interest or not. >> i don't think it is self-interest. they are giving it away anyway >> there are guys not on the politicize that have argued and i'm shocked she hasn't gone after them >> these are people who might support another democrat not people who would necessarily support a republican >> the people who already agree with her i have already taken my stand. these guys are on my own i'm not a billionaire. nothing defending them from me i don't have a billion

tax them tax them at 95%, bastards. why should i stick up for them >> you are defending them. >> i am. >> no skin off my back should we be happy if you want to reach them, you reach them through cnbc that's bad too >> no. i don't think that's a part of it >> she just wants to be talked about. find out how many ads she actually purchased then call me. >> i don't have your phone number can i text you or email you. i don't have your phone number >> you do. >> not many people do. >> when we come back, the first day of the public impeachment hearing is in the books. we'll show you what we learned and talk about the next hearing

scheduled for tomorrow walmart is set to report this morning around 7:00 a.m. "squawk box" will be right bachl. what are you doing back there, junior?

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. >> watching all day yesterday and more about what we can expect >> that first public hearing lasted 5.5 hours occasionally did get combative bill taylor delivered new information saying one of his staffers overheard president trump ask about the investigations overthe phone >> i think you said that after the call, when your staff asked what president trump thought of ukraine, his response was that president trump cares more about the investigations of biden, is that right >> and barsima, yes, sir >> i guess the point is that he cares more about that than

ukraine? >> yes, sir. >> focusing more on the mueller report and hunter biden arguing there was no problem because ukraine did eventually receive hundreds of millions in aid. >> my understanding was that security wouldn't come into he committed to pursue the investigation. my clear understanding was that they weren't going to get the money until they agreed to the investigations your clear understanding was wrong because it didn't happen >> after the hearing, house intelligence chairman adam schiff says he is reserving judgement on next steps. they are debating how long an actual impeachment trial could last speculation ranges weeks to months let's talk more about how the impeachment process could impact the markets and your

money. with our guest, it looks like the markets have been shrugging it off >> that's right. right now what the market is pricing it is that the house is more likely than not or near certain to pass articles of impeachment. it moves to the senate the senate is extremely unlikely at this time to remove the president from the office. they are focused on getting through this earnings season and economic reports coming out of the fed, which generally are pretty good. >> is fromthere a moment when y think the markets will sit up and pay more attention or does it rely on whether the senate will react >> sort of near term with the

ambassador who is in the center of this and this overheard phone call he's already updated his testimony once the market will look at how many, if any republicans side with the democrats with the passage of any articles of impeachment. then there will be speculation on is that enough to really start breaking the dam wall in the senate mitt romney seem more likely possible to side on the side of conviction someone like lamar alexander who is going to be retiring, he's one to watch with how it relates to the president >> how do you think this impacts president trump's reelection potential?

>> that's a good question. it is clear that for the most part, everyone in this country has put on their jerseys if you are for trump, you are against impeachment. there is a small group in the middle especially in the suburbs. we learned in 2018 that republicans and president trump right now are fairly toxic in the suburbs. if impeachment doesn't result in removal but continues to derode that support in the suburbs for president trump, that could be a real warning sign. especially the suburbs of philadelphia, detroit or milwaukee where those are the key three states in my opinion for this election continue to deteriorate, there is more

speculation he'll have a tough time for reelection in 2020. >> what do you watch for that? do you believe the polls there >> the polls will be very difficult. one of the things i'm having a hard time with is the difference between the national and the state polls. an average polling error for an incumbent president has been as high as 3% you add onto the fact that president trump is very probable to lose the popular vote but could still win the electoral college. he could lose the national vote by as much as 5% and still have the 270 electoral college vote to have the election he could be down the day before the election and if we have an average polling error. people will still give him a fighting chance for reelection

>> last time, the number showed 99%. she was ahead by three. >> she won by 2% nationally. >> the other thing you didn't point out, you don't know who the dem candidate. generic dem does well. each one when you put it, you go not them not that person. they are much less predicted he's still 42 cents. i think 18 cents for elizabeth warren the same predict who is going to win the white house in 2020, a dem or republican, it's like 52%. it is weird. when you put a name on the dem, that's when it becomes a problem. >> that's not too far off from where our predictions have been. with the strong economy and lack

of a primary opponent. >> who is the dem going to be? buttigieg? >> what i have been focused on more is we are easily on our way to the first contested convention since 1952. >> i think that too. i thinks that bloomberg's play if it is not going to be clean, you just got to get there. >> john kerry. >> if donald trump ran under the democrat's rules, he would have gotten to the conviction in 2016 without a majority of the delegates. if you do have bloomberg or patrick who step in. if it's a three or four candidate race going into super tuesday, democrats, if you get 15% of the vote in any congressional district, you too joe could get a delegate

you should be in the running >> what happened to bloomberg? you cutting him loose? >> are you kidding me? >> i think bloomberg is terrific >> you've thrown out devaul patrick. >> he just announced yesterday >> bye bye >> the most accomplished person, competent and accomplished >> trump no bloomberg. >> is this even a question >> he's a billionaire. that's the last thing we need. >> the most accomplished and competent person you know? in business, climate change and gun control. >> those are not my key issues

that's giuliani. >> coming up, billionaire bob parsons here to talk with us and he's a billionaire got that goes against him.

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♪ >> billionaire entrepreneur bob parsons recently announced $10 million grant to the semper fi fund for wounded warriors and their families the creator of go daddy and p parson's extreme golf. and the bob and renee parsons foundations that has raised $100 million just for semper fi last year, that's just one of your charities how many charities do you work with >> i think we work with about 30

different charities. we are moving to charity about a million dollars every 14 days. >> i love that one the semper fi. >> a lot is military oriented anda lot has to do with natura disasters. i know every disaster, you are out there front and center with team rubicon can you tell us about those efforts as well? >> team rubicon takes former military and it gives them a purpose and helps in transition over to civilian life. what we fund then is the cost to send these former marines, soldiers and sailors into a striken area to bring it back to where it needs to be

it helps the area we go into and helps the people that are doing it it is in/win you are go daddy's founder you are out now. you've got how many businesses you are involved with? pk is one of them right? >> i have 16 businesses that my wife and i operate they run the gamut from golf to motor cycle, power sports dealerships, we make furniture, we have a big metal fabrication shop that can make anything but money. >> it does make money. >> it doesn't but it makes some good stuff we have a sound recording and movie recording studio >> biggest lender in arizona >> in scottsdale, arizona.

>> you have a place dom and i would be interested in >> scottsdale national golf course in the outskirts of scottsdale surrounded by three million acres of government land >> it is not just 18 holes >> no. it is 45 holes >> and what else a hotel. >> the hotel is for members and their guests it is 60 rooms, it will rival any hotel room it is a good property. >> can you get a good meal there? is. >> you can get an outstanding meal there >> golf clubs. how do you break into that and become sort of the it man?

>> the way you do it, you don't compete with them. you do something different when we moved into that business number one, it has been declining a number of years. the golf industry the past 10 years, units have declined by 30%. we moved in. those other companies, they engineer the product to a price point. we engineer our products to outperform anything and be the most outstanding club made once we do that, we put a price on it. >> i haven't hit them yet. >> the first thing i asked him, is there any reason to believe if it would make my edge game improve. >> first, we have to change the way you think. >> how can i think positive when

i know i'm going to hit a bad shot i want to ask you quickly about being a billionaire. in arizona, i figure, you don't walk around hanging your head in shame. you feel okay about yourself someone running ads about how bad billionaires are >> there are billionaires and there are billionaires i grew up dirt poor. i joined the marine corp at 17, carried a rifle in vietnam i was wounded over there by the way, i failed the fifth grade. i was going to fail out of high school if i didn't join the marine corp and i did. i came back, went to college, graduated magna cum laude.

i taught myself how to program a computer in the late 70s started the business in '84. i used to work 60 hours straight around the clock to get any software done. i knew when i was working too much i started to halucinate. then i would go home, sleep eight hours and work another 60 hours. built another system sold that to intuit. built go daddy that's where i made most of my money. now i'm no longer with go daddy but i have all my other companies. i give a lot of money away >> i always hear the american

dream is dead? >> i don't think so. i thinks it alive and well >> alive and well in china, right? >> we are talking about mobility >> listen to that, it's unbelievable >> inspirational >> i wish you could come back for hours and be a guest host. >> i'm in. >> he's in >> i'd love to have you back it is great having you on. proud of you proud to know you. >> my pleasure >> coming up, when we return, icahn confirming he's pushing for a deal between xerox and hp but viewers were already tipped off to that. >> and a look at yesterday's s&p winners and losers

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welcome back to "squawk box" on cnbc let's show you where things stand. in the red about now about 25 points down on the dow. s&p 500 looks like it will open down about two points and nasdaq down by 13 points. carl icahn pushing for the proposed merger between hp and xerox. a 4% stake at hp and he owns 10% of xerox he said he started buying hp in february without any intention of a deal with xerox i hope you all remember this, "squawk box" viewers were tipped off last wednesday when research analyst joined us and said he

kbleebed icahn was pulling the strings behind that deal watch this >> we have reason to believe he's on that side. carl icahn's are known for poor disclosure for some reason, the fcc has allowed him to operate that way. he has found a way to game the system so he doesn't have to report it is possible no more reported for him. >> billson also sniffed out warren buffett by attracting private planes >> he said at that point, he had to come up with a different way to start tracking things >> talking about blue horseshoe and riding around. you were asking if he road around on a vespa?

>> what day was that >> monday. thursday or friday. >> was that really thursday, a week >> a week ago. >> coming up on today's -- >> it was. >> on today's agenda, result from walmart and viacom. stay tuned you are watching "squawk box" on cnbc >> announcer: today's big number 275 million. that's how many people shop at a mmceart store or on one of its e coer platforms every week, according to the company robinhood believes now is the time to do money.

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. >> viacom is due to report its latest quarter results before next month's expected merger with cbs shares of the media company are down 31% it is not stopping our next guest from being positive on the stock. joining us now and looking overall of us almost like a god looking down on us you got to take this shot. he's so large and he's not in studio but he is here. i can go out and just reach him. >> the camera doesn't do it justice. you got to get closer. >> i feel like he is here. >> cisco telepresenc >> 4d. 3d >> a really bad game of pass

word >> a public company that had the guy on all the time. >> imax. >> tim, it's like you are on an imax screen here, with sense surround be careful tell us about viacom, why you think that's a way to go in media. >> certainly, we've seen a massive change in the distribution of media. if you are not disney and you are not netflix, you are not getting valuation. cbs is trading about 4.5 times earnings it is hard to see how bad earnings could possibly be to justify that kind of multiple. they've got some pretty good legacy assets in nickolodian and paramount pictures looking at trying to get mtv

back on board and some other channels we are pretty bullish on the backing on the future of viacom and putting the team back together with cbs adds more content in the future. >> we are in media, so we love talking media. let's talk nike. seems like it is close to some new high territory you still like it though >> well, we own nike in our growth strategy. it is hard to argue with their leadership in the space they are in they've done a good job of narrowing their business back to focus on the core competencies a long time, it seemed nike got stretched into every possible sport, some noncore. it is about the shoes. we see nike as a better company than it was five years ago >> you like the management

changes and management that is there now? >> certainly, you've had a management change and that can be disruptive but the shoe business is moving into more customization and more direct business they have announced they are no longer selling through amazon which implies to us they feel they are gaining more footing on their own. >> how about walmart and that plays in to what you were saying about amazon too >> right about five years ago, walmart came out and discussed how they weren't going to grow their earnings for a while so they could become the next amazon in a way, they have. they've grown their on line business and are a support system for other businesses.

they have their competition trading in this atmosphere looking at the bricks and mortar retailer moving towards the internet and the internet company moving towards bricks and mortar we'd rather own the lower valuation in that metric >> amazon is not just internet ordering with retail, not just digital and walmart has effectively moved in there as well the world is big enough for both >> i think so. here, we are heading in and part of the bumper talked about the stat of how many million people visit walmart. we'll pay close attention to foot traffic more than short-term earning numbers walmart is really a fantastic

logistics company. >> thank you for having me even on the large scale. >> someone wrote in to me yesterday and i thought about it on the just list we had yesterday. seven out of ten were high-margin technology companies with room to pay their employees. jc penny paying more than market wages. >> it is a valid point and those technology companies don't have the same sort of overhead >> some of them won't even be able to compete. i don't know you know what i mean >> i do. >> you do? >> but his point is that when you are able to pay your employees and make them happy and they are able to make your customers happy, you are more likely to be a stock that does well >> right we went all the way back to the

'30s people have been doing that for a long time. >> jay powell will be back on the hill today we'll talk to one of the committee members who will be questioning him and we'll talk a little about elizabeth warren and that new ad, next. >> announcer: don't forget to subscribe to our podcast you'll get original interviews and original content look for us on apple podcast or your favorite podcast app. subscribe today. i knew about the tremors.

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it is time for a wealth tax in america [ cheers and applause >> i've heard that there were some billionaires who don't support this plan. >> the vilification of billionaires makes no sense to me >> it's bull >> that's a new ad that senator elizabeth warren is running here

on cnbc, taking aim at billionaires and pushing her wealth tax plan and joining us right now to talk about that and so much more, democratic congressman row kana, member who will be questioning fed chair j. powell i want to get to what he's going to talk to j. powell about i did want to get your thoughts on this ad there was a bit of a discussion earlier whether you think this may be considered trolling i know you are in support of a competitor to elizabeth warren, bernie sanders >> well, let's start with the facts on the wealth tax. 87% of american wealth is in the united states. the next highest is the cayman islands at 2%, and britain at 1.5% so people who are saying that somehow they're going to take their money outside the united states if there is a 1 or 2% tax remind me of my friends who said they were going to leave the united states if donald trump became president guess what they're still here because america is the best place to live, and they'll still keep their money here because america

is the best place -- >> i live in new york city and i don't know if you've noticed, but there are a lot of folks moving to florida. i know they're not leaving the country per se, but you're starting to see the movement of money in a meaningful way. >> sure, i cthink people can mov within states. 38% of america is a world equity and debt markets china is 10% we're four times the next nearest country. and you talk to anyone in my district in silicon valley, they will still tell you the best deals are here the best investments are here. some of these people, the billionaires will grumble. at the end of the day they're going to invest their money in the united states. the most entrepreneurial place >> i have to bring something else up which, i noticed it on twitter. we're going to disagree about this one you put out a tweet i think literally yesterday. when private equity firms buy struggling stores, they claim to help them succeed. often it means the firms take the company's assets, load them with debt and sell them for scraps, thousands of workers lose their jobs. we must stop wall street

looting. you then go on to have some numbers, working for retailers and private equity firms have lost their jobs in the past decade are you familiar with what's happened to the retail industry in the past decade >> sure, they face competition from amazon and -- >> right but it is, it is diabolical, sir, to claim that somehow the private equity industry is responsible for the failures in the retail industry. i can send you to the national labor statistics numbers for the retail industry over the past decade and this is a small fraction of the problem that's taking place in the retail industry >> well, let me, let me respond. i agree with you that a lot of the technology is causing the displacement of the retail industry here's my problem. why is it that private equity, when they get their management fees and they make 1.5%, often hundreds of millions of dollars, don't have to discourage that if a company goes bankrupt?

my view is if they're going to take a company ask that company goes bankrupt, which is about one out of ten in their portfolios, they should disgorge that and people get severed. my problem is with the model i'm not blaming private equity for the technology revolution. >> but just so we're clear, if you read this tweet, it suggests that somehow private equity is responsible for these lost jobs in the retail industry i'm sucking to you, sir, that there are much bigger forces taking place in the retail world that are responsible for these job losses >> i agree with that i agree with that. of course, i don't blame private equity for the entire demise of retail jobs. there are e-commerce jobs, amazon jobs. what i do blame is their model they take these risks. they are getting 1.1% management fees and even if the company goes bankrupt, they don't have to give those fees back. i think most americans would think that's absurd. >> you have a problem with a tweet about retail a congressman's support for bernie sanders doesn't raise any

issues with you about whether -- >> congressman is free to support -- >> i'm not saying he's not free, but i might start there with maybe pushing back on -- >> i don't need to push back >> okay. he's wrong about retail, but don't worry -- congressman -- >> i like and respect this congressman. >> i do, too >> he's making very smart points, by the way, especially around carried interest and other things around the private equity -- >> remember new math, those things, my circles with you, congressman, must be like this >> we're going to run out of time to have the conversation we wanted to have about j. powell today. >> go ahead. >> he's going to be -- >> no, we didn't >> we're out of time congressman, i'm going to wish you luck with this testimony with j. powell today and i hope you're going to come on back and we can have a meaningful and longer conversation. >> i love the show, love the back and forth >> we appreciate it. we appreciate your time. thank you. >> all right when we come back, walmart is expected just in the next few minutes to report its earnings

check out that stock it's up nearly 15% just over the last three months. "squawk box" will be right back. ♪ ♪ sundown vitamins are all

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sundown vitamins. all clean. all the time. breaking earnings news, retail giant walmart rolling out quarterly numbers. we've got the numbers and instant market reaction straight ahead. >> taxing wealth elizabeth warren blasting billionaires in a fiery new campaign ad. >> it is time for a wealth tax in america [ cheers and applause

>> and the big business of food. award-winning tv host and chef lydia is our special guest >> so, almond. >> the second hour of "squawk box" begins right now. ♪ ♪ >> good morning and welcome back to "squawk box" right here on cnbc i'm andrew ross correspond ssorg with becky quick and joe kernen. hate to say it, but we're going to show you red right now. the dow would open -- >> barely. >> it was 25 points off before s&p 500, we'll cull it unch. we'll be generous marginally in the red there. >> if the s&p closes down again today. it was down by 3 points

yesterday. it will be the first time in a month -- >> we are awaiting walmart results, we should say, which could move this whole situation around potentially we'll see. nasdaq looking to open down a little over 9 points right now >> and we are waiting on numbers for walmart. mike santoli would have been telling us what we're watching, but i'm told that they're coming out, courtney, already >> so here we go walmart does have its numbers out here for the fiscal third quarter. it looks like earnings coming in at $1.16, adjusted that beat estimates of $1.09 on revenues of 127.999 billion. we take it three decimal points here that is slightly below analyst consensus of 128.654 billion walmart does say that there is around a billion dollar drag from currency on revenues just for the quarter. so the retailer is, though upping its earnings guidance for the year slightly on the back of these stronger q3 earnings, it's

now expecting a slight increase. previously it was between a slight decrease and a slight increase of earnings for the year u.s. comparable sales for walmart coming in up 3.2%. that's slightly above expectations, and also the 21st straight quarter of growth for that metric. traffic also higher for the 20th straight quarter there for those walmart stores now, net online sales in the u.s., so these aren't comps, these are net. these grew 41% that's going to be the strongest quarter so far this year for that metric. online grocery continues to be a key driver there now, i did speak with walmart cfo brett biggs briefly. it was a good quarter. we had solid momentum. he also said the u.s. consumer remains overall in pretty good shape. no material change that he's seen over the last several quarters now, a lot did happen in walmart's quarter specifically, though there was the launch of the in-home delivery in three markets. a new delivery unlimited option for grocery.

foreign is leaving and in september c.e.o. doug rick mill an said they will stop selling munition used in military type weapons, hand gun sales in alaska. ending those in alaska does mark the complete exit of handguns. so, i asked biggs about what's going on there he said that the retailer has not seen a discernible ripple effect to other categories from exiting those ammunition and hand gun categories. you can see shares here of walmart in immediate reaction are up about 2% on these results. >> mike, what do you think >> i was going to say domestic comps is probably the thing to fixate on for walmart, just a broader view that's a beat right there. the stock came into this at a high it's been an amazing performer the market has given this company a ton of credit for disrupting itself. unless there were margin issues below the surface where the cost of the online growth is getting out of hand. it looks like the market likes it and the guidance seems conservative considering they

beat this quarter and they're inching up the rest of the year. >> a lot of what they've been doing, again as a logistics company where you're really getting fulfillment to the customers or letting them come pick up, those have been the things that few successful retailers who have been able to compete with amazon have come up with, i think of target and walmart. >> i think when the options rolled out, i thought that's a nice option. >> huge, yeah. >> it's really working people really do it. if you think about the numbers they throw out all the time, 90% of the u.s. population lives within ten miles of a walmart store. so on their way home from work, they're going to potentially be passing that store, which is faster than getting delivery for a lot of people. and i know that really does work and they're seeing it in the numbers and the metrics they provide us >> mike, you point out the willingness and ability to disrupt themselves >> yeah. >> that's certainly been huge. >> it's been huge, and the market i think maybe slightly surprising is giving them a ton of credit for it if you look at it in the aggregate, it's a slow top line business, 25 times earnings. >> remember when they first came

out, when doug mcmillon came out, not only was he going to pay his employees more, he was going to be spending more for these initiatives. wall street was like cold water hitting investors at that point. they sold off. it took time he did that early. it was several years ago now they're willing to -- >> the company had to demonstrate they could actually execute it, and i think that so far -- now it's almost swimming the other way. the market is willing to believe they can, they can kind of continue to pull it off. >> i think the management team built up some street cred. >> all right >> courtney, why don't you stay with us? we're going to bring in garrett nelson, senior analyst at cfra garrett, let's talk about what you see with these numbers does it change your opinion at all on the stock >> sure. thanks for having me absolutely not this was a blow-out quarter for walmart. they're one of the most masterful companies when it comes to earnings. they have now beat 16 of the last 17 quarters and here you had a significant beat

they beat by 7 cents and what's really driving their, their same-store sales growth is the e-commerce business. so e-commerce was only about 5% of walmart u.s.'s total revenues last year. but here it's growing upwards of 40%. and if you look, walmart versus amazon e-commerce, that's triple the growth rate of amazon. and so that's what's really driving the overall same-store sales growth and it's really being driven by the grocery pick up, and less so grocery delivery >> what's your rating on the stock? >> it's a buy with $125 price target right now but that's under review. >> yeah, because the stock is at 125, right >> correct >> i'm guessing it will be under review and you'll look at it and take it higher are you looking at 12 months >> well, we haven't gone through the release yet, but we'll be revising our, our estimates and rating in target this morning. >> garrett, in the world of

retailers that you cover, which is your favorite buy >> it's walmart. you know, the e-commerce growth is really, as i said, it's being driven by grocery, but there's so much room for growth there. you know, if you look at the company, they're now guiding for a slight increase in eps over the $4.91 that they earned in their last fiscal year but there's a very clear path to $6 in earnings over the next few years for this company they're returning a lot of cash to shareholders in the form of dividends, share repurchases and then they're having billions of dollars of excess cash flow left over after that >> all right garrett, courtney, mike, want to thank you all for being here >> thanks. >> by the way, don't miss next week's cnbc's evolve summit. this is about companies that have evolved and changed with time obviously walmart is a great example of that. what they've been willing to do in terms of disrupting themselves

i'll be there at the event with on-stage guest including c.e.o. doug mcmillon. if you want to attend go to cnbc.com/evolve and register for a seat >> coming up when we return, top corporate stories and why jack ma said alibaba's single day fell short subscribe to our podcast you can get interviews, behind the scenes access and so much more look for us on apple podcast or your favorite podcast app and subscribe to "squawk" pod today. most people think of verizon as a reliable phone company. (woman) but to businesses, we're a reliable partner. we keep companies ready for what's next. (man) we weave security into their business. virtualize their operations. (woman) and build ai customer experiences. we also keep them ready for the next big opportunity. like 5g. almost all the fortune 500 partner with us. (woman) when it comes to digital transformation...

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here's what's making headlines at this hour alibaba singles day had record sales, but apparently not enough for jack ma, the co-founder of the chinese online retail giant. ma told shanghai -- a shanghai convention this year's event did not meet his expectations despite registering more than 38 billion in sales ma said that warm weather may have impacted the sales. an activist investor and florida resident carl icahn -- doesn't matter >> matter to who >> to roe. you're trapped here in the country, so we got you where we want you and you're not going to

move so we're going to get you anyway, xerox will push forward with its bid for h-p icahn holds a 10.4% stake in xerox and told "the wall street journal" he now holds a stake in h-p. combining xerox with the computer maker could yield some big profit for investors wework lost 1 and a quarter billion during the third quarter, weighed down by growing expenses that comes despite revenue nearly doubling compared to a year earlier last month softbank group increased its ownership in wework 80% in a rescue package did you happen to see what adam newman, where he was looking at some property? did you see that yesterday >> no, where >> which one >> somewhere on park avenue. >> another place he's going to buy? >> for 45 million. >> he has a new pay package. >> newman. newman >> was that a cultural reference you just -- huh? >> that was a cultural reference. >> you're coming around.

>> a $45 million penthouse in park avenue according to our good friends at the new york post >> because it's the new york post i was on a train for eight hours. >> you read everything yesterday. >> i know this building, it's next to the church it's a nice building actually. >> it should be for 45 million >> is it near one of your units in that building it's not >> it is not i don't have any units i'd like some units. >> you know our 1%er problem >> yeah. >> did you fix that echo in your foyer? >> now you're using my jokes >> you're using mine, i'm using yours. that's nice. because of their set, i think. >> this set. and we're here with becky. >> so perfect that she's right there, isn't it? >> perfect guess else who is here coming back we'll show you lessons from the kitchen famed chef lydia is cooking things up. stay tuned, you're watching "squawk box" and we'll be right back >> announcer: time now for today's affleck trivia question.

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>> announcer: now the answer to today's affleck trivia question. herman melville published "moby dick" on this day in what year the answer, 1851 >> okay, folks, we are now just two weeks away for thanksgiving. "home alone" doesn't mean dining in 10% surveyed plan to go out to eat on thanksgiving. i don't do this on thanksgiving. i eat with the family in the house. two-thirds of shoppers out on thanksgiving day and black friday will dine out now, for more on all this, i want to welcome our special guest lydia here, chief restaurateur, award-winning host, runs a food empire with her children tanya and joseph. joseph has been on the show before has tanya been with us on the show i don't know a new book out for lydia,

recipes from my flagship restaurant lydia, thank you for joining us. >> thank you, andrew a pleasure being here. [ speaking foreign language >> wait a minute, yes? thank you. >> what do you mean about people eating out on thanksgiving how do you feel about that >> i'm kind of split i have restaurants i love that. they fill them up. they come. it's really challenging and wonderful to feel that you're part of a special day or a special family day big families come all the time and i love that. on the other hand -- >> you want people cooking in their home, right? i'm looking at -- >> there's plenty of people out there. >> we can get all this at italy, right? >> at italy, or major store, shop rite, whatever the stores -- it's in the stores it's on the web. it's whatever. the wine as well as the pasta sauces >> what is your -- actually, i'm curious, though. do you have a favorite distributor? are there retailers that you like more than others? you just like all retailers?

>> you know -- >> that sell your stuff? >> from the point of view of having a line, but i am cautious and i do visit -- we do visit -- my son-in-law is involved. we visit the stores regularly to make sure it is rotated, the dates are correct because once you send out your product, you don't know how it's managed out there all the time >> is everybody selling at the same price >> no. they each one -- you control that as well >> you're like the first bush. when is the last time you were in a -- you know they have scanners now >> when i say do they all sell at the same price, you can go -- >> i know. >> you said shop rite. >> when is the last time you were in a shop rite? where do you send your people, which super market do you send your people? >> oh, stop it >> king's has it and i guarantee you, why pay less i pay a lot more at kings than i do -- >> so, to get back to the prices, you do promotion with the stores >> right >> you give them at a discount to them.

hopefully they'll pass on the discount to the customers. >> right >> that's the thing -- >> how about getting shelf space? >> shelf space is like paying rent you were talking about rates when i came in represent is high in the stores. placing your products is pretty -- >> what about web and direct to consumer right now >> well, that's, of course, the growing market it's a whole new -- we love it we are honored amazon, we're on it. >> you are and you like amazon? some people have misgivings about being on amazon. >> you see, this is a product i can control. for me it's very important that i am truthful to my guests, to my customers in the sense of quality and what i put out there. >> right >> reflects my philosophy of good food at the right price for the people so, that's, that's important to me very much we control that to some extent it's packaged, it's all that we put it out there. now, how they sell it tout

there, i hope they do justice, that they deliver on time, that it's packaged properly and doesn't break, so on >> the amazon worry is -- would you like to have a more direct to consumer relationship with the customer also costs sometimes more because you have to acquire that customer in a different way. >> it does, you are absolutely right. you can't deny the exposure of a company such as amazon certainly. but, you know, i do appreciate very much the direct contact with the customer, and that's partly, i think, my longevity in the business because i think earning the respect of your guest and your customers, they will keep on buying and coming back >> right >> and that means really being conscious about the product, the value, the quality, and the taste, of course >> do you do a lot on social media now? >> we do >> how much of that is your business >> we do social media, to promote to market, we do a lot of organic

sort of ourselves. we do each unit, each restaurant does their own so that the chefs, the personnel that's behind it get involved, you know >> right >> and that is very important for the guest to connect with somebody that will be in the restaurant when they come. >> lydia, what do you see in the restaurants right now? what does it tell you about the american consumer, their willingness to spend >> it's changing it's time for restaurants really to take a look, restaurateurs and -- because the business is really changing. it's changing with the millennials and really wanting great product, but wanting value. they are not as interested in service and in kind of fancy tablecloths. they want it delivered they want it on time they want it good. >> they want it delivered, not even in the restaurant necessarily. >> delivered -- >> oh, to the table. >> both ways the delivery element is really taking -- >> who do you use to deliver do you use uber eats >> we haven't delved into it

i'm very concerned about the quality that ultimately will be delivered. and, plus, money wise, these companies take a big chunk they take 30% off, you know, the price that -- how do they -- they take it from me and they increase the price so my visibility out there to the customer might be, oh, it's not worth it, tropical storm tembin' t it's too expensive, whatever we started our business in the restaurants, that's where our core business is >> what are you doing to address these changes that you see in the population's taste for restaurants at this point? >> well, as a restaurateur, you have to be very cautious and attentive, and you have to be within the -- you have to be sort of ahead. as chefs, we do set the pace, if you will we do kind of innovate going ahead, what is the quality of the food so in each restaurant, for example, the longevity of lidia,

whose book we have here, is 38 years. and that's almost unheard in the restaurant industry. so, you know, you might ask why, why, and again, going back to that -- first of all, the italian way of life, the italian food is honest it's seasonal. it really tastes good and nurtures you so that's important to keep. >> tips, i just want to know about tipping. what do you think -- >> tips -- >> i do. >> he wants to know how little -- >> it feels like tipping is changing because there are so many restaurants now that aren't accepting tips >> you do the elizabeth warren thing, you do 2%, don't you? >> no. and, by the way, there are new services -- >> you don't do the wealth tax tip? >> do you do rezi that was bought by american express in the future people are going to walk into the restaurant, sit down, order the food, and walk out. >> without paying, just like amazon >> and the tip will be added -- >> 20% just -- >> included, right

>> yeah, it's between 15 and 20%. if you are very generous, you're over >> that's a good one, elizabeth warren tip >> that isn't funny. >> 2% won't do next time you come in the restaurant, the customer -- you know, the servers, they deserve, they work very hard. >> lidia, it is great to see you, we're thrilled. hap thanksgiving two weeks in advance. >> thank you, same to you. >> i'm going to do red sauce for lidia. >> we have a dinner for thanksgiving so it is the book. you can come >> maybe i should take the whole family >> you should. >> i'm going to call you i now know somebody. i can get a reservation made >> the table and waiter. >> turkey isn't italian. >> you saw the hoopla about if you're woke. skip thanksgiving, save the planet you've seen that don't visit relatives, don't use turkey it's a huge deal this year

check out huffington post. it was entitled "you may want to consider skipping turkey all together, more importantly, the travel." it was call the environmental impact of your thanksgiving dinner in the huff post. seriously, if you are woke, you're going to skip thanksgiving completely. >> i'm woke to the woke. >> no, no. >> i'm not kidding that's huge. >> you know, i came here 12 years old. so whenever we do the holidays, if it's easter -- we do it italian style. but thanksgiving is the one opportunity that i and my family have to celebrate and to thank america. so, you know, we look forward to it both the restaurants and at home >> maybe the kale thing in the shape of turkey and walk where you're going, get some exercise. still to come -- what's happening? you want me to read? >> yes, sir. >> ibm says it's ready to change weather forecasting and how everyone from a farmer to a banker does business as a result and then this morning's stocks to watch, including viacom posting quarterly results.

did you look up the stuff? and then later taxing wealth presidential candidate elizabeth warren, blasting billionaires in a fiery new campaign ad. she's running on hot networks like cnbc. we'll be right back. obvious.

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♪ ♪ welcome back to "squawk box," everybody. we are live from the nasdaq market site in times square. ibm bought the weather company in 2015 and today the tech giant is announcing a major new development that will marry a big super computer and big data, and perhaps change weather forecasting the world over senior economics reporter steve liesman visited the super computer in raleigh, north carolina >> in developed countries like the united states, our smartphones warn us of looming storms bitter cold or searing heat. but billions of people around the globe lack even basic weather forecasts, making the world a much more chaotic and dangerous place.

but in an historic marriage of big data and super computing, ibm is launching graph today the global high-resolution atmospheric forecasting model. ibm says graph will provide accurate weather forecasts not for a few places around the world, but for the entire world. what you're hearing is the sound of dais, the ibm super computer that runs the new global weather model. it's named after an ancient god who ruled the daytime sky. it has 84 cabinets that 12 trillion pieces of weather data every day for 12 million locations around the world the super computer is so fast, this massive model provides new forecasts every hour instead of every six hours. >> we are actually getting down to kind of the cellular level of the thunderstorms now where we weren't able to do that before and with that information, we can now provide better support to critical decision makers. >> it's big potential business

because big companies increasingly need accurate weather data >> any business that doesn't have a weather strategy is missing out on recurrence. all it is tied to your environment and the weather, being able to predict that in advance for retailers, energy companies, travel and transportation businesses is all we do. >> better international weather forecasts can mean more comfortable flights for passengers who are routed around turbulence and even shorter flights >> if we can do a more fuel efficient flight, we can certainly save money on fuel there's just a variety of ways that operating on time and efficient manner improves the american bottom line >> so much cool tech in that super computer among them they have the gpus, graphic processing unit instead of cpus for video games. no matter how good, it has to prove itself over time america will wait several months before relying on it along with

the other data ibm is going to continuously upgrade the model so it is going to add real-time weather data from airplanes and even smartphones with permission, they can give temperature data and pressure data from around the world. and that's really the key to predicting the future, is having a lot of real-time input of what's happening right now >> it's interesting. this is almost private industry kind of stepping up to fix some of the problems that we failed to fix with infrastructure as a nation because when you look at the time it takes to do this, the gps system, the navigation system that we've built in for airplanes has made it so that you have to pad in at this point sometimes for delays >> exactly >> because you can only get so close. if they can get better by fixing some of the ways they route around it -- >> let me first point out this is a public private partnership with the national center for atmospheric research >> good. >> they partner with academia. this is one of the great things to come from that. but you're absolutely right. we need to have much better tech in order to -- >> something the airlines have

been saying a long time. i wrote a column about it for fortunate probably eight years ago or longer. >> it's cool because farmers in india can figure out is today a good day to plant the crop or not? you go overseas. where is my weather? and you're so used to in america -- i know a storm is coming in two minutes or not overseas they don't know that. >> is that deducible i don't know there is chaos there, right? with whether -- can this new computer, this new quantum computer, can you do chaos theory and figure out chaos theory on a quantum computer >> i'm not a weather geek. i have this abiding interest in how well we can forecast future. the horizon on this model is 15 hours. the good horizon in weather forecasting today is about three to five days and, by the way, it is multiples more accurate than it was even five or ten years ago. you see how they track those storms, right? >> you can't tell me about 2100,

the year >> i know where you're going with this, joe i know -- >> no, i'm not, i'm not going there, no, no -- >> klei climate ology. >> there's a reason you're a weather geek you're a fisherman you go out in the water -- >> when they said i kotb, couldt saved my life. >> someone who loves economics appreciates a physical science it actually has true experimental validation. >> joe, every one of your jokes is a kernel of wisdom. the kernel of wisdom -- >> that's not a joke >> that's mocking. >> you do like actual rigorous -- which never comes into play in the dismal science of economics because it's all about human nature >> >> and behavioral. you could be a psychiatrist. >> i'm on this little crusade here the way to fix economics is much

more data input. we need to know more about what's happening now what has to happen is the economics world, the financial world needs to follow the model that the weather has put forward to us, which is this super computer is taking pressure data, wind data, temperature data, all over the world, putting it into a model and telling us what's going to happen we don't have that in economics. >> thank you, steve. it's pretty cool >> on my little crusade. thank you. >> he's a renaissance man. he's a musician. >> they still look out the window anyway -- >> i still don't know what's happening out the window >> could rain. coming up -- >> could be a recession. >> economics they make weather guys look bright today's big market drivers, the futures right now indicated down a little bit they've turned negative, but not in ray big way after so many series of new highs, down 19 on the dow. stay tuned you're watching "squawk box" on cnbc >> announcer: don't forget to subscribe to our podcast

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welcome back to "squawk box" the dow and s&p both closed at record highs yesterday joining us to set up today's trading session, gabrielle a santos, global market strategist at j.p. morgan funds investment strategy at kumar global strategies. he said such crazy stuff in the past that came true, i have to start with him all right, we bounced off of those low 4.1, 4.5 levs on the ten year we got almost back to two. tell me now, tell me we're in now an environment of rising yields tell me that you're not going to tell me that >> we are -- given time, the next year, which is what we have talked about, joe, on past programs, we are in for a period of lower bond yields >> come on that's what you said last time >> look what happened. you hit 1.942 days ago we are ten basis points lower. >> right >> and there are -- all the

uncertainties that you have in the world, there are three things which matter for bond yield. one is expectation for inflation. second, expectation for real economic growth. and third, the unknown being what happens with global uncertainties. and none of the three factors tells me that they are going to push up the bond -- >> it's telling other people that they are. we had paulson on. he said the dollar is going to weaken because a lot of the head winds that were keeping it strong are abating so he says the dollar is going to weaken. inflation is going to come back. europe is going to respond to a lot of this easing that they've seen and a lot of the stimulus europe seems like it is coming back to some extent. there's the first two. we will get inflation, we will get some growth. you have to change your forecast, sri. you're not going to? >> it looks like what you said, joe, it looks like what i heard in 2009, 2010. growth is going to pick up, inflation is going to pick up. >> where do we go this time, sri, 1 1/2

>> reaches 1 1/2, then we will reexamining the situation. but in terms of what is going on, you will have a trade situation, which is unresolved economic growth -- federal reserve bank of atlanta gdp now number for the fourth quarter is 1% >> right >> the quarter we are in and i don't see any reason the growth picks up in the new year, joe. and then inflation wise, the core inflation continues to maintain -- >> you must think the stock market is way out over its skis, then >> i think the stock market is way out. that is not unusual. it happened in 2007 as well. >> don't bring up 2007 >> that's where we're headed >> i don't think we are headed that way i think the bond markets, andrew, is that the recession is going to be short and shallow. >> let me get to gabrielle what do you think? >> no problem. we would agree with some of that in the sense that it seems like

every time the ten-year gets very close to 2% that there is a lot of demand that comes in to add duration, right. and so we do think that there is a bit of a ceiling there for ten-year yields out over the next 12 months they should go lower. but we do not think that there is a recession or a big market fall in the cards. it's really just about the demand that need to hedge some of the risks that are still prevalent for 2020, that puts a bit of a ceiling on the ten-year >> on the ten-year what about just overall? >> overall, our feeling is that the base case of positive, but moderate growth, is getting stronger, right. i do think we have to acknowledge that over the past 30 days the risks around that view have decreased. so it does make sense to have a little bit more enthusiasm in the equity market. with that said, our view for the next 12 months is mid single digit returns. and with some volatility along the way, so we would also be adding some duration here. >> mid single digit return is

different than a mid single digit decline. you're not saying that especially after all these -- we're at new highs so adding a mid single digits on the new highs -- >> it means higher in 2020 >> it does >> it's not in a straight line by any means >> but if you look at economic growth expectations quarter after quarter, we are decelerating i don't see a reason why it increases in 2020. >> we don't think it does. it's more of a stabilization >> we had -- last december we had jamie dimon on cnbc talking to you, becky. he talked about the ten-year yield going up closer to 4%. we are not going to be there any time what he said during the conversation you had with him. we are moving in the opposite direction and we have moved and i think we are going to move further along in that direction. >> so you're doubling down 1% before we see 2? >> i think -- you can hit 2 one day. i'm not saying it won't happen

tomorrow >> one or down 1.5 again below 1.5? >> 1.5, and then if you have miraculously all the trade situation resolved and economic picks up, i would say to you, joe, i'm no longer looking for -- >> i don't ever expect you to say that >> i will say that -- >> you will? >> things change at the moment we are looking for, at most, 1.5 before you change >> okay. sri, thank you >> thank you >> thank you so much >> when we return, senator elizabeth warren has made taxing billionaires a key pillar of her campaign, and she is doubling down this morning with a new attack ad. the wealth tax showdown. we'll have that straight ahead ♪ ♪ whether your beauty routine is 3 steps...

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senator elizabeth warren is out with a new campaign ad targeting billionaires high profile investors and bankers, and the names are very familiar to cnbc viewers >> it is time for a wealth tax in america [ cheers and applause >> i've heard that there are some billionaires who don't support this plan. >> the vilification of billionaires makes no sense to me it's bull. >> the ad is scheduled to run on "squawk on the street" and "mad money" today and lee cooperman is going to be appearing on fast money at noon eastern time today with his reaction to this entire

situation. joining us right now to talk about it is joel griffith. he's research fellow for the heritage foundation's institute for the economic freedom and opportunity. and jared bernstein, the center on budget and policy priorities senior fellow, also a cnbc contributor. jared, what do you think you have advised democrats is this a smart play >> lee, if you're listening, don't go on tv today look, i hate to create a hole in your 12:00 spot, but the baseball players have a saying a boo on the road is a cheer at home as far as elizabeth warren's political brand and her campaign are concerned, these billionaires are doing her a great favor by invaying against her wealth tax we can have good arguments whether her wealth tax is the right way to go after wealth but the fact that wealth is more concentrated than it's ever been, this is a huge issue for democrats. and the idea that so much wealth escapes taxation, especially unrealized gains, is at the heart of a really important

public finance debate she's helped to start. i think she's done us a great service. i think these billionaires are their own worst enemies right now. >> if it's helping her, why are you against lee cooperman coming on, then you're against her >> i'm just saying if those billionaires want to give me a tiny chunk of their wealth, i will give them some excellent media advice >> you should want lee cooperman to come on because it helps elizabeth warren unless you don't want to help elizabeth warren. you want to help joe biden >> i'm trying to be honest i don't understand the logic these folks are the wrlorst offenders. >> you're being honest >> i'm always honest >> you don't need to say t. >> joe, this brings up a lot of red meat to elizabeth warren supporters >> he's having a discussion about the right way to go after this wealth. i would say we should be discussing whether or not we should be going after this wealth at all because what we know is that this capital that investors have been able to

accumulate, it's not as if they're holding this in bank vaults and under their mattresses this is the capital that's being invested in research, being invested in development, it's being invested in new business opportunities. if we begin taking that wealth and the economic study shows over a longer period of time, this would wipe out in excess of 70% of the wealth of some of these investors, this means negative economic results for all of us, not just on the wealthy. >> joe, i want to stop you because to me there is an issue here, which is that folks like yourself -- and i don't project onto you, but i'd say the heritage and others, for a very long time have pushed back frankly on any -- not wealth tax, but on any additional taxes at all and, in fact, i would argue that it's the result of that pushback on what i consider the low-hanging fruit on a system that doesn't work that's led to maybe we can describe it as an overshoot if you'd like. the pendulum swung too far where

conversation is meaningfully happening around the country as a wealth tax i would argue the conversation about a wealth tax is even happening is because the easy stuff, the stuff that seems so unfair to the average american has been allowed to persist as long as it has how i do think about that? >> i think i understand where you're coming from but the fact is a lot of these proposals have worked. if we've looked at how we've had the top income tax rate has been brought down from where it was in the 1970s, we've seen the gain -- we've seen the income tax on capital gains, we've seen that come down substantially i would argue we've seen positive economic results on that median household income at a record high. if you compare our average family to germany, for instance, which is a very prosperous country, our disposable income per family in this country is $11,000 higher than germany, for instance and that is a gap that has widened -- >> how would you answer the question about the inequality gap which is only rise en? >> i think that our focus should

not be on the difference in equality of wealth or income the focus should be on the gap in equality of opportunity >> opportunity you need to let him finish opportunity. >> first of all, pretty much every democrat running for office strongly disagrees that inequality should be off the table. and i understand why you'd want to go there. but i think more fundamentally, joe is really telling the old trickle downside story that's been disproved time and time again exhibit a right now is the trump tax cuts, which were billed a very significant cut in the corporate, which were billed as an investment charger and business investment has been an extreme soft spot to -- >> how about, how about the trump new proposal that he just floated this week and larry kudlow talked about, too, to offer tax cuts to the middle class if they come up with tax cut 2.0? >> you know, i don't think it's a good idea, to tell you the truth. and the reason is that we have a big revenue problem in this country.

we don't talkabout this enough because we're so focused on the high-level fights between the candidates and the billionaires. the motivation for these policies that warren and sanders and biden -- all of them are talking about is to raise the revenues to support -- >> it's not to cancel out the deficit, though. they are talking about programs of additional spending >> it's a fair point and a good point. >> jared, i'm going to push back on you, which is to say the thing that i don't understand about this for the life of me is if you're going to push a wealth tax, it's not being advertised as a revenue generator it's just not. that's not the ad. that's not the ad that elizabeth warren is taking out that's not the ad that bernie sanders is taking out. i actually don't know why they don't call it the wealth insurance program, which is to say we're going to tax you to effectively protect your wealth. let's just be honest about -- >> hold on a second. >> about how it's being marketed >> when she first, when she

first introduced "her" wealth tax, she talked about raising over $2 trillion over ten years. the reason i remember that, there was a lot of scuffling and fighting whether that was a realistic number and we can have that discussion. initially there was a revenue focus. i think what's happened is she's found this political opening because of the kinds of arguments that this ad is generating and all the debates we had and that's a political winner for her as i said initially, the idea here and it's still all over her materials, is to raise pay-fors to pay for her programs. i agree with becky that doesn't take down the deficit we have. theoretically it doesn't add to it >> joe, you need to push back -- i don't want to tell you -- what happened >> go ahead. >> you need to push back on this narrative that i hear. someone from the left says, you know what, the jury is in. trickle down and supply side growth does not work >> exactly >> that's such crap. that's a load of crap, jarrett it's been proven that it doesn't work >> it's empirical. >> it's not empirical. go ahead

it's ludicrous if you grow the pie, you have more to split up all you do is split up a smaller pie, it doesn't help anyone. go ahead, joel >> we have statistics on this thankfully, and this is government data. and i'm sorry, jared, the numbers aren't on your side on this >> i said government data. >> median household income is at an all-time record high, second all-time record high that we've had. second of all -- second of all -- >> not the highest we've ever had. maybe median family income has hit record highs about 30 times. >> i'm sorry, i'm not going to be able to let you finish your thoughts we are out of time on this >> don't defend trickle down >> you defend trickle down government >> gentlemen, thank you for being here we'll have you both back soon. don't miss lee cooperman's response to elizabeth warren's ad today he will join scott wapner at

noon "squawk box" will be right back. bye.

walmart scores a bottom line beat the retail giant raising its earnings guidance as it reports third quarter results. >> a magical start for disney plus the entertainment giant's stock soaring on eye-popping sign-up numbers. >> and billionaire bashing from a top presidential candidate massachusetts senator elizabeth warren out with a new attack ad against some of america's wealthiest the final hour of skauks begins right now.

♪ ♪ >> speak for yourself. good morning and welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square i'm joe kernen along with becky quick and andrew ross sorkin how are the sleeves? looking good you taped the clicker. doing the funky chicken. u.s. equity futures at this hour, down about 20 points on the dow, not a lot happening so far. we've got about an hour and a half to go before we start trading in ernest. we'll see where we are but right across the board, treasury yields back -- now down to 1.84% on the ten-year >> let's talk about some of the stories investors are going to be talking about today walmart posting mixed results for the third quarter. retail giant slightly missed

analyst estimates on the top line, but it did beat on expectations on the bottom line. walmart also raised its full-year earnings outlook and comp store sales came in above estimates. they rose for the 21st straight quarter. we're going to be talking a lot more about walmart in just a couple minutes that stock up close to 3% in the premarket right now. also take a look at this activist investor carl icahn thinks sear o should push ahead in its bid to buy computer and printer maker h-p. icahn owns 6% stake in xerox he owns a 4.2% stake in h-p. the combination of the two companies could yield big profits for investors. you're looking at xerox. you can look at that stock right there. also check this out. senator elizabeth warren targeting billionaires once again. this time in an ad scheduled to run on cnbc twice today. take a look. >> it is time for a wealth tax in america [ cheers and applause i've heard that there are some billionaires who don't support

this plan. >> the vilification of billionaires makes no sense to me it's bull. >> that's warren's campaign to target the ultra wealthy who she says should pay more in taxes. set to run on "squawk on the street" and "mad money" today and we should say that lee cooperman, one of the individuals you just saw in that ad that she pulled from the great interview, frankly, in my estimation, that scott wapner did with him just a couple weeks ago, will join scott wapner once again on the "halftime report" today to respond to it that happens at noon eastern time today you can argue that these ads, as we said, i believe there are only two that are airing today i think you called it trolling it's not that she's trying to persuade necessarily the audience -- >> running that ad on cnbc is. >> boy, is she getting coverage on this network, i don't want to suggest anybody change this channel. you can see coverage of this ad literally across every television network today and that's what she's trying to do in terms of firing up her own

base >> also kind of sending a warning to any other wealthy individual who might be willing to speak out against her might be the target of the next ad >> that's interesting. you think this is a strategic effort to -- >> potentially maybe silence some people. you wait to get through -- most people she's trolling are people who might actually vote for a democrat but she still has a lot of competition in that race at this point, including michael bloomberg potentially getting into the race, too >> i hadn't thought about it so much in the idea that this is a target at those folks so much as it is about cree -- generating enthusiasm in her base against them, which is starting. >> i think that all of the previous interviews with lee cooperman were on cnbc i think that's -- i'm taking that to be why she's deciding to run or her -- >> by running it on cnbc in particular -- >> are we billionaire class? >> it's a shot across --

>> i don't particularly see cnbc in the pockets of wealthier billionaires believe me, i feel kind of lonely a lot of times here, you know what i mean i think we do fine holding power to account >> look, i think the argument is that we have a audience of business leaders and very wealthy business leaders combine -- >> i think we do well here, we have broad shoulders to keep things -- don't you think? do you watch >> i watch >> let's talk about a few stocks shares of american brands, selling smith and wesson, expected to be complete in 2020. stock is up by 5 cents network equipment maker cisco systems beating street on top and bottom line for its latest quarter. however, the stock is lower this morning down by 5% cisco issued a weaker than

expected current quarter forecast and noted a slow down in global technology spending. i think they said the number of deals didn't slow down, but some of the bigger deals they had anticipated maybe came in with some slightly smaller numbers. i think they also talked about how they didn't think it was other big companies that were stealing from them, but maybe just a little bit of a slow down in what customers are willing to put on the table also, a programming note for you. don't miss an exclusive interview with cisco c.e.o. chuck robbins. it's a little later this morning on "squawk on the street" at 9:00 eastern time. >> fed chair j. powell is back on capitol hill today to testify about the u.s. economic outlook. here's a bit of what he told the joint economic committee yesterday. >> i think the new normal now is lower interest rates, lower inflation, probably lower growth and you're seeing that all over the world. not just in the united states. you're seeing it to a much greater extent in many parts of the world than we're seeing it here >> today powell is going to speak in front of the house budget committee joining us now is the chairman of that committee, congressman

jay yarmouth of kentucky congressman, it's been a while it's good to see you this morning. >> good to be with you, joe. good to be with you. >> what do you think that the most important things that the fed chair needs to get across at this point have we cut enough, do you think, in your view? and when does congress take on the deficit in ernest, the spending time, not revenue side? >> two great questions first of all, on the spending side and my ranking republican member steve womack will agree with me on this, we, in terms of the funding congress has annual control over, what's called discretionary spending, is only $100 billion more than it was in 2011 so we actually have done a pretty good job of controlling that part of the budget over the last 8 or 9 years. what we are seeing a real problem with is mandatory spending, which is social security, medicare, medicaid, and interest on the debt potentially will be a problem, but not right now. so those are, those are

significant questions which have political ramifications. when you have basically two-thirds of the american people over 65, who depend on social security for at least half of their income, 50 million people on medicare, these are, these are real issues that -- they're not called the third rail for nothing >> mr. chair -- >> we talk about them a lot. this is one where republicans and democrats, if we're going to do anything, have to walk the plank together even when we tried that it hadn't worked. >> i remember -- we know about unfunded liabilities we know about mandatory spending and a lot of the looming deadlines where we have to do something. but we're not talking about that not only that, we're talking about the expansion of some of these entitlements, logarithmically. not necessarily republicans, but presidential candidates in the democratic party are you comfortable with

expanding these entitlements beyond where they are right now? you're in kentucky maybe not. >> i'm comfortable with talking about it you know, one of the things that -- one of the bills before congress right now, medicare for all bills, basically just takes all of the money being spent on health care everywhere in the country and shifts it onto the federal tab, which, if done, would be the greatest giveaway to corporate america ever. because it would relieve all the employers of any obligation and shift it onto the entire tax paying public. so you have to figure out a revenue stream if there is a way, there are people, serious people who make this argument, that you can with savings and a certain level of taxation on employers and others, you can actually create a more efficient system. that's the debate we'd need to start having because we're not going to pass medicare for all in this political environment. >> congressman -- >> go ahead. >> do you think the savings from

the administrative costs or profit incentive for private companies, do you think that savings would not be -- those savings would not be offset by the inefficiency of a huge government program have we ever seen any huge government program operate efficiently? >> medicare is efficient it's more efficient than insurance, with 3% cost -- >> you put everything together -- >> we had scott gottleib earlier on in the week, former head of the administration -- i'm forgetting -- fda. he talked about chairman, how administrative cost is a little misleading he said what really happens is medicaid and medicare rely on the private insurance oversight for much of what they do, which is why -- which is why you would see higher numbers there >> humana is based in my district and humana, that's what they do.

they administer government health care programs >> right >> and they do very well but getting back to j. powell for a minute, what i think we ought to know -- want to know from j. powell is two things primarily. what's happened as a result of lowering and raising rates, has it really made that much of a difference and what kind of difference has it made? and what's happened with the tax cuts and whether -- i heard in your prior segment, talking about whether middle class tax cuts justifiable or advisable or not. i think we have to get -- really dig into what's happened with the 2017 tax cut and see whether that's made a difference clearly on the macroeconomic level, it doesn't seem to have made much difference >> i was going to talk to you overall what's happening in kentucky, whether -- how blue it is right now but then i thought about blue and i thought about kentucky and evansville i mean, what happened there? we have to go. >> i saw the last half of the game and kentucky just flat-out

got outplayed on their home floor. i'm a louisville fan as opposed to kentucky fan. we're ranked number 4 and moving up and won last night >> i saw that last night. >> we're going to have two good teams in kentucky anyway >> thank you, chairman espn talks politics and we talk sports topsy-turvy. anyway, we'll see you later. >> we can talk bourbon next time >> now you're talking, although it is 8:00 anyway, now you have me thinking >> that's when happy hour starts in washington these days >> and rightly so. >> coming up, when we return, a lot more on "squawk. a pair of key economic reports, we are set to get the latest numbers on the producer price index, and we'll talk a little walmart in just a moment >> announcer: coming up, we dive deep into walmart's third quarter earnings where does the retailer stand in its long-running battle with amazon and what do this morning's results mean for shareholders as

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walmart posting what we're now calling mixed results for its third quarter. the retailer did raise its full-year outlook. courtney reagan joins us now with more. >> yes, i'll go through the

details for you. walmart beat earnings estimates by 7 cents revenues, though, of $127.99 billion was more than third quarter. there was a billion dollar drag on currency and revenue. it was double what it expected for the drag in the quarter. the retailer is upping its earnings guidance for the year on the back of the stronger third quarter. now expecting a slight increase in earnings growth previously they had said to expect between a slight decrease and a slight increase. u.s. comparable sales coming in, up 3.2%. that was slightly above expectations and the 21st straight quarter of growth traffic also higher for the 20th straight quarter now, net online sales in the u.s. grew 41%. that was a strongest quarter so far this year. online grocery is a key driver in the pre-recorded earnings call, however, when it comes to u.s. e-commerce, c.e.o. doug mcmillon had some interesting things to say. he said, quote, we need to do more and move faster especially with our assortment including market place

and our strength is being driven by food, which is good, but we need even more progress on walmart.com with general merchandise. we're mixing the business out better to achieve better margin rates but there is more work we need to do we need to translate this repetitive walmart business that's profitable over time. that is what we are working on >> courtney, thank you joining us, we want to continue this conversation. joining to us talk about walmart results, director of consumer research at refinativ. chris is here, hard lines analyst at j.p. morgan chris, i'll go to you. quickly, your top line, i was watching or looking at this report that you just put out literally moments ago after hearing this report. >> yeah, i think big picture, it was a nice 6% beat versus expectations we don't expect a full flow through to the stock reaction today. basically because the stock is rich on valuation. and while they continue to

expand operating margin in the u.s. business which is key to the bull case, some of the beat was driven by the tax side so the tax portion and the valuation is going to inhibit the flow through of that 6% eps beat >> what kind of, what kind of price tag do you put on that stock, 12 months out >> you know, 12 months out, i think from here given where the valuation is, you're basically buying earnings growth their target a mid single digit eps growth rate over the longer term, so i think that's sort of the base case here to the extent that the walmart u.s. business stops expanding operating margins, that comp 2 1/2, i think there is more risk that that multiple can contract, given that in the multiple is 23 times as you look ahead. it was not that long ago the stock traded around the s&p, so you're at a nice premium t where the market is currently. >> just to clarify, will you be short the stock?

>> we have a neutral rating on the stock. we just think it's a very well positioned company they are executing very well the consumer is solid. they're driving a good balance of top line growth and delivering -- >> you're saying all these positive things yet you're quote-unquote neutral. let me bring you into the conversation where are you on this? >> i think what's really remarkable from today's result is the fact that walmart raised their guidance to date we have received 22 negative guidance from retailers and only 7 positive. so the fact that they're doing this in a time when there's a lot of uncertainty -- >> is that a story about the consumer or a walmart specific story >> both combined because walmart has proximity to the consumer, it's so large, it reaches 90% of the u.s. consumer. it has a store within ten miles of them. so it tells us both the consumer is strong and walmart's initiatives are very well. >> so i think that is true, but i also think that they raised their earnings guidance for the full year because the third quarter is so strong

the implied fourth quarter didn't actually change they didn't lower it, but they didn't move that up. >> right so when you compare the third quarter results this year results to last year, total sales grew by 2.5% the average ticket by 1.9% the amount of money consumers are spending both online and on store at walmart has increased drastically. the positive traffic is really what's driving the win that we saw today. grocery delivery, the grocery pick up. they're all building customer loyalty that continues to drive the positive growth that we're seeing at walmart. so they're doing a really good job in integration between online and store >> what do you think the stock is worth >> i think that a lot of the good news is already priced into the stock. >> so you're back in the neutral, hang out with the stock, own it, don't own it? >> i think walmart is very well positioned going into the holiday season >> your friend chris here thinks

the multiple could potentially contract on the stock. >> i think when you look at the forecast and where walmart is positioned for the holiday season, i think it's one of the best performers and walmart is definitely going to be one of the winners. >> this is cable you can tell him he's wrong if that's what you'd like to do >> i think, like i said, walmart is very well positioned going into the holidays. >> chris, this is cable. tell her she's wrong >> i think you want to look at other operators. i think the consumer is solid. i'd rather look at a name like target it's got a significant 5.6 p/e discount to where walmart is trading. we think they outcomp where walmart comped this year we're into the consumer into the holiday. i'd rather have a larger mix of discretionary product in a pair he wi apparel and toys the consumer is going to target. >> only put it in one stock. who are you giving it to >> target.

>> well, for the holiday season, maybe target only because they're better with agethleisur. when you think about walmart, target better than walmart >> that goes to what doug mcmillon was saying in the pre-recorded transcript. he said we're doing a good job with grocery, particularly grocery online that is building our online business but we need to get better at other things online and those higher margin businesses to move that business towards a possible opportunity to profitability >> and i think it's outstanding that he has repeated it over and over during the earnings call. i also want to point out that they already know that their groceries is strong and they're use ing it to win over a bigger population of the consumer >> right >> they already have the families that come for groceries. they just recently partnered up with buzzfeed tasty app which allows millennials to pick a recipe and add those ingredients. it's about fast and convenient

ways of making the consumer and attracting the millennial to shop in the stores >> thank you courtney, thank you. chris, thank you >> thank you >> also an important programming note in an era of rapid technological advances, demographic change, legacy companies adapt, innovate and evolve you can join walmart c.e.o. doug mcmillon who is going to be interviewed by the one and only becky quick at the cnbc evolve summit if you take -- you have to get on a plane to go to the west coast unless you'realready there. november 19 in los angeles you can check it out, cnbc events.com/evolve. to learn more, register. do all the fun stuff >> when we come back, a magical day for disney the entertainment giant surprising with an impressive start for its long-awaited streaming service. we'll bring you the details when "squawk box" comes right back. ♪ ♪

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welcome back to "squawk box" right here on cnbc take a look at the futures dow off 25 points right now. s&p 500 looking to open down as well about three points and the nasdaq looking off about 17 points this morning >> a strong start for disney's new streaming service. disney plus. the company says that 10 million people signed up to use the platform on its first day of service. reference netflix has about 158 million subscribers around the world. it's not clear how many of disney's new customers are taking advantage of that free 7-day trial, but the company is projecting that it will have between 60 and 90 million subscribers by the year 2024 aided by the positive streaming news, disney shares gained more than 7% yesterday. that's its best day since april. we should point out these are -- >> what we also don't know -- >> a lot of them were signed up -- >> through verizon those are free as well i think

the first 12 or 18 3months, whatever it is the issue is when that period ends -- >> the stock may have jumped ahead of itself ahead of that. it's super they have 10 million. >> i didn't know 10 million was such a great number because -- >> 10 million like that? numbers -- >> i know. everybody definitely wanted to do it did it it goes down from there. >> call me in a week or two. call me in a week or two and see. >> you're negative >> i'm negative on a different issue. the money they're going to have to spend to make it work >> i like cable. coming up, breaking economic data, fresh reads on the jobless claims i like cnbc. we'll bring you the numbers and quk x" rurt market reaction when "sawboetns we do have "squawk" pod. ♪

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welcome back to "squawk box. rick santelli here live on the floor of the cme group with some breaking news. our second of two inflation gauges this week october price producer index up 4/10 on headline. it's up 3/10 oncor hotter than yesterday's cpi and both these reads are higher than expectations there are no take backs on last month's look, which was minus 3/10 headline and core they stand unrevised let's strip out some things. if we look at ex-food energy and trade, it's up 1/10.

year-end final demand up 1.1, that is a couple 10th hotter than expectations. 3/10 hotter than last week year over year numbers, if we look at year over year core, sequentially following 2.0, like much of the data, 1/10 hotter than expected. he if we add in trade ex-food and energy year over year, it's 1.5, 2/10. jobless claim, revised, add 14,000 onto that and you see our 225,000. we end up with this week, that's a pretty good jump all things considered and we are starting to move a bit away from that kind of magic low 200,000 spot that goes back to the late 60s. continuing claims move from a whisker under 1.7 million to a whisker above 1.8 million. so 1.683 to be exact yields well, consider this.

194 is our high water mark close on the move that has occurred post the mid september 190 close high here we sit 10 basis points lower than that level on the long end we've seen the yield curve, which has steep ened most of the last six to eight weeks. flattening just a bit. andrew, back to you. >> rick, i'm sorry, what did you say happened to bond prices? >> bond yields 1.84 are exactly where they were before the data. but obviously they continue to melt away a bit from last week's 1.94 kind of recent cycle high close. >> rickster, thank you for that. the professor is here this morning, mr. liesman, who looks very studious right now. >> i'm perplexed i'm not sure what to do with this number. let me tell you the month on month is a little bit hotter than expected, but the year over year is not really that big a deal, right? i'm looking at final demand year over year 1.1% ex food and energy 1.6%.

ex food and energy minus trade, 1.5% we did have a jump in energy prices that was baked in. along with that we had a jump in food prices, up 1.3% looking down when i look at personal consumption, 0.6% goods 1.1. these are all hot, but the 1.1 on goods is a reversal to 0.7. the issue now is understanding or thinking about how tariffs can affect this number these prices are pre-tariff numbers. >> right >> okay. so they should not necessarily be affected by tariffs at the producer level >> right >> they would be if it's passed along at the consumer level depending upon how much margin is eaten in there. you can imagine prices going up, perhaps some producers use that opportunity for higher prices. in general, the expectation among economists is the tariff effect such as it will be if those december 15th tariffs do go into place because that will be a spring event.

something that will show up in the data in the spring i'm going to call this in line with the fed chairman's idea that inflation pressures are muted. i'm going to ignore the month to month. and i'm going to keep looking at the year over year, which does not suggest very much pipeline pressure right now if this continues, i'd come back next month i'd reverse myself in a hurry if we have two out size months in a row. overall the year over year remains in the 1.5% range. i'm not going to get excite ed about that >> how is the weekend looking for weather? >> hopefully really good, but depends on where you're going to be >> that's very true. that's very true maybe people didn't see your earlier report, your earlier report on all the weather. i thought maybe you had been thinking it was going to be warm >> warmer than now, but we're not going to return to normal seasonal weather until the end of next -- >> i can't come to you for that after all that analysis? >> if you give me a heads up, joe, i'll give you a model, i'll run a model for you.

where are you going to be this weekend, joe >> is it going to be raining >> it's going to be cold, a little bit on the cold side, a little bit breezy. >> he did a report on quantum computing weather on what businesses are doing -- it could be on the "squawk" pod >> it's on dot-com, all over the place. >> you have no idea what it's going to be like this weekend? >> the only thing i care about is cloud cover on the bahamas. i can't do bone fishing. i need sun so i can see the fish ask your husband he'll tell you all about it. >> he will ron is here. let's get offer to him and talk about -- >> i like the weather channel. >> president and c.e.o., it's great to see you >> good to see you >> it's been a long time since we talked to you we talk about all the risks that are out there all the time for the market and yet we keep setting new highs. what do you think about what you

see? >> you know, look, times are good we are setting new highs in the market i think the fed has gotten it right. they overshot last year. and i think they pivoted back to the right level. you got unemployment -- i mean employment levels are fantastic. inflation is muted economic growth is good. you know, what's all the fretting about we need to get a trade deal done >> that's what all the fret sergio garcia aboufret tin is about >> they don't want to put a number on the -- they don't want to stop the force transfer of technology what does that tell you, is it nervous or are we getting closer to a deal? >> it's all negotiation. if you saw overnight, you saw the chinese economy slowed with the numbers, industrial production >> more than expected. >> more than expected. >> germany did 0.7% growth >> there you go. in china, i think the takeaway

is that the tariffs are impacting the chinese economy more than the u.s. economy this is all a negotiation, although it is important, i think, to get a deal done before the end of the year. >> even if it doesn't have some of the things that business community had been hoping for? >> they're saying it's phase one, and this is going to be an ongoing process. so i think the biggest risk to the markets today is probably trade, but let's not lose sight of the fact that we're in some pretty good times. as we look forward, we don't see a recession. we see -- we've changed -- i was on a couple weeks ago. we changed from defensive to cyclical and we think you should be investing in financials and energy what you're saying, industrials. so we think the market has a good tone here >> you think energy because you think the economy is picking up, and, therefore, more energy will be used around the globe or like jim cramer was saying yesterday, look, you can buy energy as kind of a hedge

against an elizabeth warren presidency because, you know, you will see eventually energy prices pick up if there are curbs in the drilling >> i think it's just more saying they're economically sensitive and energy -- >> demand up >> it's going to be $75 is our thought, on energy >> are you plus -- are there going to be tariffs december 15th or no tariffs >> you know, if i knew the answer to that i could make a market bet here. i believe -- i believe they'll probably push that off myself. it's a cliff >> no new tariffs, you mean. >> sorry >> no new tariffs would be -- >> now what the chinese seem to be looking for is to get rid of some of the existing tariffs >> i'm doing, becky, an informal guest survey most of the market is betting on no new tariffs that's the bet that's out there in the market. i think that's part of the reason why we can be at all-time highs because we're sort of

discounting this threat. >> if there were no trade war, would we be 10% higher >> i think the market would be higher >> do you? >> i don't want to put a number on it. yes, i do. i think that that is -- >> we already think -- everybody that comes on thinks it's so over valued. >> i wouldn't say that >> you wouldn't? >> i would not say that. i would say that there's risks to the market. but i believe if you get a trade deal -- >> there is still more left? >> again, i wouldn't be saying -- >> the atlanta fed is at 1%. >> yeah, new york fed is 0.8 cnbc ramped it hotter at 1.6, and that's the median of all of the forecasts on the street right now. so -- >> will that be the low, do you think, if europe is recovering and if china comes back? >> that's another thing, joe i think the market trades right now with this notion that somewhere between the fourth quarter and the first quarter is the trough in the slow down and there's two components to that the first is that the slow down doesn't get much worse than 1 to

1.5% it has a whole number in front of it. it doesn't go negative and it's over, by, say, the second quarter of 2020 that's the horizon on the market right now. >> the summer, we forget what the risks were in the summer we were talking about the fed. that risk has been taken off the table. >> gone. >> brexit, that was a risk everyone was going oh, my, oh, my i think brexit is not going to have the impact on the market. and the third was trade and that one is still out there >> were we too tight so that a recession was possible, but was it all just a phantom menace do you know? >> you know -- >> we were really pretty sure. was it all just in our imagination, liesman or do we have to deal with it? >> which part? >> the recession right in front of -- >> i would go back and tell you that what i said the entire time, which is i thought a slow down was baked in. i thought the slow down was made

somewhat worse by the trade war. >> remember the headlines about recession? >> i think that was overstated and i was pretty consistent. >> it wasn't that the fed averted a recession by cutting it was that it was never going to happen in the first place >> i keep thinking about this. i think what the fed said is we're going to get -- >> what do you think >> we're going to get to albuquerque by tuesday, right? and they kept that forecast to get the albuquerque by tuesday, the 2% forecast. they had to push the accelerator to get there because of the trade -- >> i think the fed raised four times. i think they overshot the neutral rate even today people think the neutral rate is 2.4. i don't think be it's there. we're kind of there now. >> where is it >> right where we are now. economically, maybe 2, i don't think it's 2 1/2 i think there is a new environment. for the next number of years we're going to be talking about -- >> we did 4. the guy in charge said we're a long way from neutral. that doesn't help. >> let's give the fed credit

they needed to pivot when they needed to pivot. they needed to cut three times they a rerted a recession. >> they did avert it >> i think so. >> it wasn't a phantom >> i was more optimistic about the possibility of tax cuts that i think the president undermined with this trade war. you can do 2.3 to 2.5. i was thinking of of a higher neutral rate because there were possibilities. >> then you have to acknowledge the possibility that long term there could be a method to the madness in dealing with china and this is when we should do it mabl not with tariffs, but down the road, the i.p. stuff, state-owned stuff -- >> i have to say if you're watching what they're pushing for now, it's back to the status quo. >> so that's the key, becky. the president has now acknowledged that the ways that other administrations dealt with the china problem was the right way, which is to compartmentalize issues, not go

for the whole enchilada at once. >> they depth come part meant allies -- the compartment was appeasement. >> that's not true >> we didn't have a whole lot of success. >> we had plenty of success. >> we end up at this point >> the political issue -- >> suddenly a lot of the populous is in favor of it >> a lot of populace knows trade because of the president's twitter account. >> ron, great to see you thanks for coming in >> i like the fact i got on here and didn't have to -- >> if i was in one of those ads, that would be a good thing >> you like elizabeth or you like lee >> look, that's not fair i think that's an unfair question i don't know either one of them

that well. >> are you running for office? >> i might be. >> you spoke too soon. >> i shouldn't have said that. i thought i got out of here. >> he came from nothing and gave all his money away >> i will say this it's not surprising to me that on one hand you have medicare for all program that requires taxes across everyone to finance that thing if you're going to shy away from that, then you go after the billionaire class, and then the billionaire class is responding in a way that gets her on this show i mean, this is free advertising. so it's an interesting thing that i see going on. >> ron, thank you. >> you got it. thank you. >> running for governor? what are you -- congress >> running for the door. >> running for the door. >> i didn't get to talk. >> hold on hold on. coming up, stocks seem to be hitting all-time highs almost daily. but is there even more up side from here? we'll talk portfolio positioning for your money when "squawk box" comes right back >> announcer: don't forget to subscribe to our podcast you'll get interviews, original

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welcome back, everybody. under an hour to go till the opening bell on wall street. president trump just tweeting, hit new stock market record again yesterday. the 20th time this year with

great potential for the future usa is where the action is companies and jobs are coming back like never before our very own mike santoli joins us right now with the story of a small group of consumer stocks that investors have decided that they are loving right now >> yes, becky. this is the anointed group actually a big reason we got in the markets to all-time highs. we have the walmart earnings today, disney news this week look at this group of megacap consumer stocks. disney, walmart, nike. aside from the fact that they're all up more than 20% on a one-year basis, well outperforming the s&p 500, they all also have premium valuations they trade between let's say 24 and 28 times forward earnings. that's at least a 40 or 50% premium to the market. the market is saying these companies have figured out the digital future in their respective businesses, i believe. so they're essentially saying they have the scale to make the investments. they fended offer a lot of the upstarts whether it's correct or not, it's also kind of hiding in some of the megacap names they feel a little bit defensive and people are willing to pay

up for the quality of the global franchise as well as the current strategy, guys >> you know, mike, the question with that, the market has decided they do this and they know how -- they know and have figured this out but how fickle is the market when it comes to things like this >> that's exactly right. the market's preference could turn to we want to go back to the pure technology names. a lot of times they're not willing to put a heavy multiple on a business within an old legacy business and worry about the messiness of it if you think about ibm, nobody is valuing ibm's cloud business the way you value salesforce.com these companies have direct relationships with consumers and you can see the tangible day to day effect of buying their products the market is willing to say they have it figured out >> mike is going to stay with us our next guest -- you're going to come join us at the table, right? i like this, you can just walk right over it's all very -- >> get a shot of that. you missed that. >> it's like the old carson show you sit down >> it depends.

we all took -- 3-0, have him come over. >> have him come on over our next guest expects the s&p 500 to have a shallower pull back than most expected. we'll talk about this. he has some ideas on how to play the current sector rotation. here right now is robert, the technical strategist at fund slimeer, so explain this. >> so the market's up very sharply between the okay lows and november most technician, you look at almost every tradinging indicator is overbomb. there is a lot of concern the market will pull back. that's the generic call out there. the message, it's getting too focused on the short-term data the bicker picture is very bullish. we look at the market data we talked about this in the sthoech /* s&p put a four week the cycle looks very normal to us it looks like 2016 and 2017 and the cycle pullbacks in the '50s,

'60s, '70s and '90's p 90. there were short term technicals we don't want to get lost in the trees through the forest the bicker market will argue we're going much higher from here >> tell me how you think professional investors think about december does that factor into your thinking no, no, to me that's a huge xaent component of how the inadvisor class operates at some point they have to lock in whatever they can you know, when are they doing the lock-in? how that factors into this >> we have the same sort of situation in september there the a lot of mutual fund year ends in september and october. so it's another part of it in terms of year end, i think the sort of the generic call is we have a year-in rally. >> it's obviously a independent direction. >> that's the conflict the conventional wisdom there is a pullback there is another view, a rally you tell me where we are

>> i can only look at the data the way i zay see it >> right. >> the way i see it, you got to be very careful on tase pateing back to the defenseful names right here i think it's such an important view when you start trending in a market overbought stays overbought so if we're looking for this near-term pullback and trying to micromanage a trade going into december, i think it's a high risk. >> i think the december tactical psychology matters but it can change on a dime. first of all, people were very defensive and fearful in august and september and got positioned that way so what we've seen so far is relief, people recampaigning it for the exposure, kind of making sure they don't get left behind, if we were to pull back 2% let's say over the next couple day, weeks, whatever it is, i think the conversation would turn from wow we got to chase this rally to december to make our 84 to we got to lock in on what we v. we are already up 23% in the s&p or

24% year-to-date. >> i just think try to micromanage a 2% trade is really hard you got to get out get back in again. i if et the trading side of it we do it all the time. but the bigger picture continues to be the market's moving higher here. >> how much higher >> i think meaningfully higher i don't know about the year end number, that's not a relevant focus right here. >> let me give you a couple of examples if we look at the argverage four-year sierkle, it pulls up and rolls back, it's a normal cycle. if you go back to the '50s and '60s and '70s and '90s, if you look at average pullback that's 20, 22%. we just had that last year the average rally is 100%. secular bull market, i'm not talking the '70s or '30s, the average rally is 30% that's a big number. the minimum is 62 to 64%

that's exactly what happened in 20 sk 2016 >> that happens to 2021. >> that's when we get bullish. >> that 3800 it looks good. >> just the average cycle, the number will sound crazy, it's 4800, 4500. >> robert. appreciate it. >> let's get down to the new york stock exchange. jim cramer joins us now. geeze, jim >> twitter is a blessing and a curse. sit not? >> ah, 75 bless, 25 curse. >> i like when i get you riled up enough to tweet to your gazillion followers, then you've got all kind, i've blocked most of the ones i don't like once you tweet me out, i start some of the once i never -- of course, it gives me something to do, i get to block a whole bunch of new people. >> look, i got to meet billy joel, i always hear you look just like me let's do a selfie, billy joel, my idol wants to do a selfie

with me and then says, look at this, separated at birth billy joel c'mon, i've seen him ten times including a couple times with elton john, it was amazing can you outtweet that? >> you got to tweet that you need to tweet that out i saw him, too, at msg, he's got like 40 songs that there are some he starts playing i go, oh my god, i forgot about that one. rereminds me of steely dan and elton. b if you put them together you got about 50% of the songs we heard. >> it's like songs that come to your head, candle in the wind comes to your head don't cry, virginia. don't mind >> let me ask you this, so we're at new highs what if there had never been a trade war that's my point, we're at new highs, maybe we do get something out of this, some day, just stop the bleeding of the last 25

years, maybe now you finally -- i don't want to hand him china like previous presidents did please >> no, of course not i would think that elizabeth warren does either i think what you are looking at is an incredible thing happened here, joe. we did big tariffs the consumer has not felt it that's why as a politician you could say listen we have to finally stop having him tack our jobs and stopping the fentanyl, stop having the assistance of technology stealing. this is the time if you are not going to do it now, joe, when are you going to do it? there isn't anybody we talk to we have chuck robbins on you think he wants to do business in cho in no, they'll steal it that's what they do. why is that acceptable we put him in the wto so they'll stop it. i don't think any president feels good with china. president obama shurp doesn't. he feels terrible about it >> let me see how close this is. >> we have the picture

>> oh my gosh. >> whoa, wow >> no, i know. my daughter was saying is that the new apple iphone 11 you can put yourself twice she thought i did something cool like tim cook would do he wanted a selfie how many times do you go up to people and feel mortified to ask for a pick he says, listen, i got to get a picture with you billy joel i pay fortunes to see billy joel, he's the best ever and he likes me. and he likes me. >> that is true. banks manage interest rate changes and airlines hedge fuel costs.

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option okay, do you futures down by 30 points make sure you join us tomorrow here's "squawk on the street". [ music playing good morning, welcome to "squawk in the street" i'm david faber along with billy joel's buddy jim cramer. we are live from the new york stock exchange carl has the morning off we have an excludsive interview with cisco ceo chuck robbins in just a few minutes from now. a half hour from now at the new york stock exchange, you can see we are set up for what looked to

be a low