good morning, everybody. welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm becky quick with andrew ross sorkin, joe is out today we do have some breaking news that we would like to tell you about right now. cnbc has learned exclusive details about a deal in which warren buffett's berkshire hathaway was outbid. the deal was sweetened from apollo's previous bid of $130 a share after an unnamed souter topped the original offer. that souter was none other than berkshire hathaway buffett told me one week go he

bid $140 a share or over $5 billion scluting debt. the apollo's offer was accepted. the later offer accepted by tech data as the better offer and buffett says he does not intend to make a higher offer a little bit about tech data, it is a global distributor of technology products and services it supplies small companies with technology software and hardware made by larger companies, larger technology companies, a middle man. this is evidence of what has been happening with berkshire hathaway as the cash ward has grown. topped over $128 billion according to most recent s.e.c. filings from the company this move is interesting pivot for buffett, he rarely goes up against private equity companies and doesn't like to get into bidding wars it shows how he's going further afield to try andlook to deplo his large stash of cash that he has on hand. he's known as being a cheap guy. somebody who looks at prices -- >> he doesn't like auctions. >> doesn't like auctions, doesn't like to get into the fray what is interesting about this some of the back behind the scenes details on this

bank of america brought the deal to him a go shop vision part of this. bank of america brought it to him. they very rapid succession went to work put an offer on the table in a matter of days. so just shows there are different ways of coming at this -- >> i'm surprised $5 billion deal wouldn't even -- it is like pocket lint. >> $128 billion gorks the , gott what to do with it mike santoli will join us on the squawk newsline to talk about this what do you think? >> it strikes me as just in terms of the nature of the business, that tech data represents, its distribution is wide exposure to the u.s. economy, global economy, which i'm sure it is a top down strategy by buffett to buy the types of businesses but they seem to check off a lot of boxes. huge example is the railroads, power transmission just the idea of relatively

steady and pretty good businesses, seems like that business could get consolidated more but then also i guess price discipline he had the ability to pay up probably not in the habit of going toe to toe with equity that also shows that it wasn't worth any price it wasn't going to be a trophy business, wasn't going to move the needle that much financially and so there is a number you are willing to go for, but not more. >> yeah. and that too, just the idea that he's known as somebody who won't pay top dollar for things, got in, saw something he thought maybe he could offer a fair bid for, he said he won't make a second bid on this. >> i'm surprised he would be involved because of this issue right? >> bank of america brought it to todd within a day, buffett looked at it and realized he would be willing to bid up to $140 over

$130 that apollo had bid greg abel went down and flew down to clearwater, florida on friday he was down at clearwater, florida, at the headquarters speaking with tech data. by saturday, they made a firm offer of $140 a share. it shows you how quickly they put it together. to speed things along, they took apol apollo's contract that it had already written, sweetened terms, raised the price and threw it back together they didn't bring in any law firms on this. >> was there a view that apollo wouldn't come back >> i don't think they were massively surprised to see apollo come back they would have thought itwas good way to put money to work. interesting, just to see these coming through, he never really got involved in some things before you're looking for more avenues because what buffett told us in recent days, mike, or recent months and years, is that he thinks market valling with as

for buying entire companies have gotten out of hand because there is so much liquidity, the markets are flush with cash, hard to buy a company outright >> absolutely. i think that is a piece of this right now. even the fact that, you know, private equity is probably done less in terms of acquisition volume than you would expect, so even private equity is saying there is not enough to buy if it can hit their thresholds for valuation, i think that berkshire won't see there to be that many ripe opportunities valuation wise and, yeah, obviously one thing that berkshire always benefitted from, that's been the story, is that being the preferred buyer, right? you have certain companies that say, you know, it is almost kind of this mark of honor to have buffett want to own your business and if you don't have that, if you just simply go for the highest take-out price, the junk

bond markets are right there to finance a lot right now. i think it makes it a struggle at this point in the cycle. >> that's why this is so surprising to me just so antithetical to his whole sort of approach, he wants to be the preferred buyer this is somebody who sold themselves to somebody else, somebody else is the preferred buyer and they put a -- by default, this is like an automatic auction. >> the tech date why's board, he came in with the higher offer, immediately on sunday night, they already approved that offer, it gave three days to apollo to come back and match -- or raise or beat at -- to beat that offer that's what happened with it we were looking at the board showing some tech data's biggest customers. it is a supplier that uses the resales products that come from other big technology companies as we mentioned. about 16% of the sales come from apple products and products from cisco and hewlett-packard enterprise 11% each it is an interesting company, tech data, from the perspective of you could be a little bit of

a bellwether for the broader technology industry. you see whoelz sale whose sales increasing >> mike, thank you for calling in it is good talking to you today. we'll see you later. >> joining us to talk more about the markets is simeon heimen at proshares, and kevin simpson of capital wealth planning, which has more than $1.5 billion of assets under management. what do you think, market valuations now, not what this deal says about them, but watching market valuations and looking at big players struggling to find things they can buy? >> the market is trading at almost 20 times 2019 earnings, which isn't bad given how low interest rates are a full valuation mike hit the nail on the head with private equity. high yield spreads are tight now. 375 on the high yield index,

rates are still low. tough to compete against that. also, with regards to this negotiation of taking out whole companies, governance isn't as bad as it was 20 years ago companies are buying back shares, and if they think the times are going good, and going forward, they're increasing dividends, more tech companies that are consistently raising their dividends than ever before you can't swoop in and just fix things because they're not as broken as they used to be from a governance standpoint. >> kevin, how about you? what do you think? >> i think valuations, we have a little over 19 forward earnings for next year. there is so much cash on the sidelines, sometimes smaller deals attract the bigger investors. >> what does that tell you about where momentum is headed we're looking at green arrows for the future, even when we set new highs the night before this is different dow futures down, but only 51 points ma maybe it suggests there is no

alternative. >> i think there is a lot of positive signs in the u.s. if we look out the window, the consumer is shopping, out there spending i don't know if it is an indication of what the markets look like or the holiday season will look like, but not 100% certain my mom is watching this morning. last night on good authority there may be talk goving to walmart for some early -- >> door busters? >> yes if the u.s. consumer spending, my mom's spending, i think that's going to bode well for the markets and for the economy. >> simeon, again, this momentum forward for the markets, we may be stretch valuation levels from a historic perspective is this the new normal given where you watch central bank policy, interest rates >> i think a couple of things, first, a little bit more of a santa claus rally is likely in order because portfolio managers are chasing returns. they want to put winners on their books. with regard to the retail season, people are forgetting, last year was tough.

the retail season up against the big market sell-off. the comps are not so bad this year there may be upside out of the consume they are year. people were freaking out the conference board survey came out at 125 a smidgen below expectations that's still sky high. >> all the economic data has been positive, has pointed to the idea we have dodged a recession. >> i think that's right. even in germany, this week, we had some good news out of germany, everybody thought this summer was going into recession. so things are definitely look slightly better than six months ago and a lot better than a year ago. it is true, what else are you going to do with your money? and the signs of overheating aren't there either. capacity utilization numbers dropped to below 77. that's a low number. >> i'm not suggesting you try to

play the china trade war or what happens on december 15th, with tariffs, that's going to -- that will be a headline risk, either to the upside or to the downside over the next two weeks. i don't know if you sit on -- if you have a little cash, say to yourself, i want to go in now, i'm betting this will go great, but that's how -- people think that way no >> i just don't know how you bet against that last little rush of money to put the names on the books, so your clients and the pms look like they own the winners all year t was in reverse last year. you had the sell-off >> that was a separate issue there were people who did that as well. >> people were getting out to make sure it didn't look like they had losers all year . >> what would you suggest, kevin, for investors who look at this and saying, okay, maybe i want to get in, but i watched the markets run up to this point and now worry about what happens

in january >> we think we're in a bull market until proven otherwise. crazy we're sitting here with a return for the year, phenomenal. i think we can see a santa claus rally. we're still optimistic for 2020. so what may be over a short-term two week period isn't going to change our views over the long-term of buying high quality companies, strong earnings, great dividends, we want to be in these names and we're excited about the next month and 2020. >> kevin, simian, good to see you both, thank you. more coming up on "squawk box" this morning. the "squawk box" black friday extravaganza begins. we have early data on the big holiday spend, projections for the winners and losers in the retail sector. all of it when we come back. $968.8 million, that's how much americans spent on turkey for thanksgiving this year according to an estimate by the

national turkey federation at dn iglyro20th'sowslht fm 18 ♪ ♪ ♪ ♪ ♪

wthat's why xfinity hasu made taking your internetself. and tv with you a breeze. really? yup. you can transfer your service online in about a minute. you can do that? yeah. and with two-hour service appointment windows, it's all on your schedule. awesome. so while moving may still come with its share of headaches... no kidding. we're doing all we can to make moving simple, easy, awesome. go to xfinity.com/moving to get started. welcome back to "squawk box. happy thanksgiving, everybody. americans ate their turkey yesterday, then shopped online in record numbers. according to early data from

adobe, online retail sales will reach a record of $4.4 billion, increase of 19% from last year's online sales of $3.7 billion adobe expecting black friday sales to reach $7.5 billion this year, that would be a gain of more than 20% from last year we have a dynamic duo to cover the retail world for the next three hours. jan niffe is here, cnbc contributor. i'll give him store credit you did not see each other at the same stores, different stores. >> different stores. >> who knows. >> that's true. >> i want to get to both of them in a minute. before we do that, full coverage of black friday holiday shopping today. frank holland is at best buy's distribution center and kay rogers joining us to talk about

the momentum for retailer target let's start with courtney reagan covering the mall traffic in woodbridge, new jersey courtney >> good morning, andrew. the cadence changed a little bit of black friday with a lot of these things happening earlier on thanksgiving day with the sales. some retailers doing early black friday sales today is expected to be the busiest day of the year for retail so when you're looking at the five-day stretch, 150 million today, 40 million were estimated to have hit the stores yesterday, and the internet according to the international retail federation. many retailers offering some early black friday deals, walmart starting those in october this year. amazon started its black friday deals last week. this weekend, though, still very critical for the sector. according to tennessee data, last year, black friday generated 6% to 7% of total

quarterly sales for lots of retailers including american eagle and best buy that compares to a normal day of 1% so black friday is the equivalent of an entire week of sales. the average household expected to spend 415 bucks this weekend, according to deloitte. you mentioned the numbers from adobe, $4.4 billion expected to have been spent online yesterday. $7.5 billion today this five-day stretch make up 20% of the total holiday seasons online sales so some early online performance issues, though, search int intelligence says that costco saw a big spike in search increases and in catch point said potentially as a result that site had some slowdowns, actually was off lon for a period of time yesterday morning. came back on h&m.com down on thanksgiving morning for about five minutes or so. and home depot.com also experiencing some slower load

times. we'll keep it all monitored here at the mall. shoppers start coming back in. for now, back to you guys. >> thank you, courtney want to get to our guest host this morning who have been traveling the malls and the shops. get a sense of what is going on. what was the gut what is gut reaction here in. >> black friday isn't what it used to be it is still a big day. you have promotions beginning on halloween or around there, consumers have a lot of choice of what to buy and when to buy the deals are special, it is a huge week gent, bend, but not wt used to be stores close by 2:00. >> good thing, healthy thing, better >> it gives you a little more time, consumers always have a fixed budget they decide when they're going to spend it is in the control the consumer >> is it better for the retailer >> retailers have more to make up in a shorter period of time it is more promotional than it felt before. >> jan what did you see on your

travels? >> walmart started on the 29th of october for christmas sales. >> really? >> yeah, really. target shortly there after if that's true -- >> now a race to july 4th? what are we talking about here >> a race to january 1st, yes, it is. we'll see plenty of sales after christmas of course. this is the best it has ever been after christmas too the whole thing has changed. this is my 55th year of being in a store working or out looking at a store on black friday i've never missed one. and it changed dramatically. when we started, not when she started, she's younger, when we starred, the stores did open at 10:00 and close at 10:00 and then they went to 8:00 to 10:00 and 8:00 to midnight and judging the store got more and more difficult the internet has done the same thing. we're out in stores, we don't know what's going on because 20% of the sales, 25% of the stores are coming online. it is hard to tell by looking at

the store what sales are doing if sales were really up 19% yesterday on lon which is what we believe, we're going to be fine for the christmas selling season. >> dana said it is more promotional than ever. it could mean there are zedeep discounts coming with that >> these are planned promotions. for most of the guys they're planned promotions >> the margin gets -- right? i assume a lot of money losers >> i don't know if it works the same way online. >> we started at 2019, allabou margin flow through. look where we're ending 2019 what is the margin flow through? i think you think about the holiday season of '19, about the letter b. binary holiday season and value and convenience between the halvf have and have-nots. it is about brands if you have binary, brands, big

box. >> give me something unexpected. how about the retailer you think is going to win that everybody thinks is going to lose? anybody out there that is not walmart or target or amazon? that you think will be a real -- >> two retailers that are going to win that other people don't think are going to win because people think the high end is slowing down, prada is going to do well despite the fact that people are trying to tell me the high end consumer is not strong, not going to affect the sales, going to be strong lvmh too, but they're trading at a number that people find hard to buy they'll do well too. caring doesn't trade at those kind of numbers. >> why would those brands work, and yet obviously we hear about nordstroms and neimans and everybody else in the high end space who is just clobbered. >> well, that's not brands >> i know. >> brands are doing fine all across the spectrum.

>> you think brands are selling through -- selling through what channel working for them >> they're selling through their own stores, selling online, selling in places like nordstroms and naeemeeimans, bu they're harvesting the -- the strong brands are winning. >> when you think about brands going more direct to consumer as well. >> and pop-ups. >> terrible question for you we were watching the macy's parade yesterday. >> so were we. >> we all were one of the great things in the world, i love macy's, how is macy's going to do and i'll tell you what came up at our dinner last night somebody said, i won't say who, said what happens if macy's goes away one day what happens to the parade that was the conversation. >> and the fourth of july. >> and the fourth of july. >> look at the parades and fireworks, memories create experiences. and when you think about what all of retail wants to be right

now it the experience. you mentioned pop-up before. who would have ever thought that lvmh would be doing pop-ups. now doing 100 pop-ups this year. you'll find a new way to create memories you think about -- >> tell me macy's is going to be here in 20 years. >> maybe here in a different form, may not be here in the same number of stores they have today and it may not sell all the different categories that they sell today. we'll vei we'll have a different retail environment in in 20 years we'll have new names to talk about and we need that with evolution. >> however, nordstroms, macy's and kohl's will be here. all the rest of the people that fall into those categories may not be here, but those three will be with us. not highly levered they're restructuring their business, the returns may not wh be what they have been however, they're not going away. >> what are the four again in. >> nordstrom's, macy's and kohl's. >> macy's still with us?

>> they will be with us. >> not the chase parade or the verizon parade it will be the macy's parade they're paying a 10% dividend, buying back -- reducing their debt load, they're doing all the things you have to do to stay with us. the question is what is the return on investment going to be they're going to be here so are nordstrom and kohl's. >> you made a lot of people happy. >> they'll hereby in different formats maybe than they are today. with stores maybe smaller number >> they're not going away. they're going to be reconfigured >> yes. >> they already have been reconfigured there were 850 stores. >> we'll have more from our dynamic duo when it comes to the holiday shopping season. when we come back, target is hitting the holiday quarter at full steam that stock is soaring, up 16% in the last month, hitting an all time high. kate rogers is at a target store in jersey city kate, what do you have for us? >> well, 2018 marked target's

best holiday season in more than a decade we'll tell you what the retailer has in store this year coming up after the break on "squawk." we made usaa insurance for members like kate.

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johnsbut we're also a cancer fighting, hiv controlling, joint replacing, and depression relieving company. from the day you're born we never stop taking care of you. welcome back to "squawk box" this morning target hitting the holiday quarter at a full sprint the stock is trading now near all time highs kate rogers joins us from a target store ins happening there >> not much happening yet. the doors are set to open at 7:00 a.m i'm sure it will get crowded quickly. the store and retailer is heading into this holiday season

with an advantage having just reported stronger than expected quarterly earnings especially compared to some of its retail competitors like jcpenney and kohl's. 2018 marked the strongest holiday season in more than a decade a lot of focus has been on digital, digital sales increased 31% in the most recent earnings report but target is also focusing on the instore experience, made investments to spreuce up its stores and smaller format store. the company is working with disney to open up mini disney shops in some locations and has teamed up with true kids, the parent company of toys "r" us, to help relaunch that brand's commerce operation target teamed up with shipped for same day shipment operations and same day pickup in stores. the company doubled the number of team members dedicated to

fulfillment. it start black friday deals early on loan for tline for red cardholders. we all know the holiday season is a bit shorter this year by six days it is important to get customers the options even earlier and as you mentioned, the stock is up under 100% since black friday of last year. back to you. >> thank you appreciate it very much. when we come back, president trump making headlines late wednesday when he signed two bills supporting hong kong protesters we'll show you how beijing is responding right after this. plus, take a look at this. this was the scene at the mall of america this morning as the retail rush rolls on santa's there already. quk x"ilbeig back. through the at&t network, edge-to-edge intelligence gives you the power to see every corner of your growing business.

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good morning, everybody.

welcome back to "squawk box. after closing at new highs once again on wednesday, you are looking at a slight pullback this morning it looks like dow futures indicated down by 44 points. s&p futures down by 5.5 points the nasdaq off by 15 the last week it seemed like every day we were sitting at new highs once again so this is just a slight pullback given the gains we have seen in recent days. president trump signing two bills into law on wednesday, supporting hong kong protesters. one bars the sale of munitions to hong kong police including tear gas and rubber bullets. the other involves an annual review of the city's autonomy from china, which is the basis of special trading status that hong kong currently enjoys washington is unlikely to revoke that special status, but the symbolic threat angered beijing, which they denounced the new law as illegal interference into their own affairs. thousands of people came out for a thanksgiving rally, celebrating the signing of the

bills. lots of american flags flying, saw someone who looked like they had on the hat from the statue of lb ty or tiberty or the crow. symbolic and something that was forced onpresident trump given the recent bills that we saw passed through congress. >> president trump made a surprise visit to afghanistan yesterday to celebrate thanksgiving with u.s. troops. during the trip, he announced a resumption of peace talks with the taliban in an effort to reach a settlement to end the 18-year afghan war the president was on the ground for about three hours, delivered brief remarks and served turkey and trimmings to troops at bagram air field nice surprise for thanksgiving for them coming up when we return, we're going to talk about the state of the consumer with national retail federation matt shane next and then later, the luck of the irish? we'll dive into netflix's big holiday release "the irishman" and talk about what it might mean in the battle for your screens. that's what i was watching last

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welcome back early data from adobe showing a record amount of online spending on thanksgiving day with more records expected for today black friday sales best buy, testing a new shipping strategy to bring all those purchases to consumers faster. frank holland joins us from a best buy fulfillment center in new jersey i may get online to do a little best buy buying in a moment, frank. >> i think brian said he ordered a phone case but best buy said their sales grew ov grew year over year. they're trying to continue that trend by offering 50 million people in the biggest cities free next day deliveries on orders placed as late as 8:00 p.m. something the company boasts as the latest deadline in the industry a lot of this is due to their investment in supply chain and logistics. we're standing at the mec in the

n new york city area they're a key part of the company's holiday strategy to target 50 million people in those big cities with the latest deadline for free next day delivery as long as orders are over $35 just take a closer look at the mecs, you see the building, this blue, white and yellow, best buy colors, that's a high tech, high density auto automated warehouse that lets this company target customers in big cities. we spoke with rob bass, he says it is all about competing on customer convenience. >> really what we're after is allowing you to go to work, enjoy your day, hear about the cool thing that somebody bought at best buy, get home, relax, go online and get a chance to buy that and get it tomorrow we believe it is not about saying next day but allowing you to shop late today and get it tomorrow. >> prime members get free next

day shipping on orders befo s be noon local time, but they have to pay a fee important to note, 3:00 p.m. is the deadline for best buy orders for mec areas outside of new york, chicago. they managed to maintain market share three quarters of revenue coming from big screen tvs, mobile phones and the like the company says it sees free next day shipping as a way to bring in customers and attract them, through price match guarantee and geek squad service as a way to keep them. >> thank you very much. for more on the state of retail on this black friday, let's welcome matthew shay, the president and ceo of the national retail federation good to see you. >> hi, becky happy black friday. >> happy black friday. first of all, let's talk about your forecast. you're talking about a very voluntary bust shopping season this time around how much do you expect shares to

be out versus last year. >> our forecast for the holiday mean is that shares will increase between 3.8 and 4.2%. that averages out to about a thousand dollars per consumer. that's $730 billion. it is substantially better than a year ago our numbers indicate we're up a couple a percent last year for a number of reasons. some of those you have talked to earlier in the segment the stock market going in different directions we had the government shutdown this should be a good year our members are very bullish, consumers are spending and we have every reason to believe that will continue. >> what do you think is really pushing the sales this time around, the healthy consume, healthy outlook for the economy? >> that's a fair question because we know that as we see in the past, just because the macro conditions are healthy, not every retailer performs equally. again, knoyou know, we have a diverse group of members we can't pick any of those. we love the mall

you know those that friare find ways to compete. it has to do with convenience. has to do with fulfillment, has to do with the selection, the assortment so i think retailers are finding a way to deliver what consumers want and they're doing it in a way that makes it convenient for them that's what your last seg was about, how do you make it happen and get that experience as conveniently as possible >> i hate to throw a little rain under this parade. we do have the story of what has been happening with the trade talks with beijing we just talked in the last block about how president trump on wednesday signed two new laws into a -- two new bills into laws both of which support the hong kong protesters that angered beijing, which said this is illegal interference with their own internal affairs that's not great news. how are you watching this? how are you keeping an eye on this what does it mean for the

retailers you represent? >> we're watching it very carefully. as we have been and we have been very engaged in conversations with the administration and the u.s. trade representative and ambassador lighthizer and others about trying to move this forward and i was in hong kong a few weeks ago and in shenzhen and talking to some of our members, talking to suppliers, talking about others involved in the supply chain about how they're working with this. you heard in earnings and analyst report last week, number of retailers referenced this so continues to be a concern and we're hopeful we get progress on the phase one deal, maybe we don't implement that fourth tranche that 156 billion of december 15th tariffs and move forward and show signs of progress as we get into 2020. >> what would it mean if tariffs are put in place on december 15th >> i think it is hard to predict. we know many retailers had the opportunity to try to work with their flyer partner and adjust their supply chains. we know larger retailers have the scale and the scope, the resources, to maybe spread some

of this impact across other goods, to work with their suppliers. some have just come out and said they're going to refuse to pass on any increases to their customers. for smaller retailers, for other independents, midsize companies, independent small companies, very difficult to do that. and so i think we're hopeful because we believe that overall moving forward on a trade deal will be good for the entire economy, not just retailers. so we want to see some progress. but i think as you heard other executives say many times, a lot of levers can be pulled. many of those pulled already i'm sure retailers will continue to find ways to deliver the value their customers want and work through this. we would like to not face any head winds if we can avoid them. >> something you just said struck me. this idea that the biggest retailers have been able to kind of maneuver and make sure they can spread the pain. it seems to me the smaller

retailers had a tougher time for a-long time as they try to compete for the big guys going online and being able to deliver instantaneously and do different things has it gotten that much more difficult as a small independent retailer to try and survive in this environment >> i think it continues to be. i think that's a real challenge for independent retailers. and they're facing competition in a lot of different ways for example, some of fulfillment and inventory management issues are a big challenge for them they don't have the scale. they have the ability with the internet to try to attract the larger market, other platforms out there to take advantage of those to reach customers in other places when it comes to negotiating with suppliers, that's a real challenge. and if a supplier has a cost increase, that a small retailer really can't negotiate, there is not much they can choose to do, they can try to change products, they can try to push through price increase on to the customers, which is in a

competitive market not an easy thing to do. that forces them to eat the cost or shave margins somewhere that's one of the things we tried to communicate to the administration if you think about the 42 million jobs created in the retail industry, we talk a lot about the bigger companies, 95% of those retail companies out there employ five or fewer people, 50% have one location. so we're talking about a lot of small businesses as well so it is not just the big ones that you already mentioned there is a lot of smaller companies there that employ people across the country and they're going to feel this >> matt, want to thank you for being with us this morning that's a pretty optimistic view and expectation for what we see this holiday season, but already kicking off with black friday today. good to see you. >> you too. >> we'll see you again as we get deeper into the holiday shopping season. >> thank you so much. when we come back, details on our own big breaking news story of the morning a bidding war involving warren buffett, one he was notse successful in.

bob johnson says the 2020 election is president trump's to lose we have his comments next. don't forget to subscribe to our podcast. you'll get interviews, original content, and i'm a regular in my neighborhood. i'm a regular at my local coffee shop and my local barber shop. when you shop small you help support your community - from after school programs to the arts! so become a regular, more regularly. because for every dollar you spend at a small business, an average of 67 cents stays in the community. join me and american express on small business saturday, november 30th, and see how shopping small adds up.

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welcome back to "squawk box. media mogul robert johnson speaking out about president trump's chances at re-election he spoke to our own hadley gamble >> reporter: when you take a look at what president trump has done in the last several months,

particularly the exchanges around the u.s.-china spat, is this his to lose, do you think >> i think the president has always been in a position where it's his to lose based on he's bringing a -- sort of a disruptive force into what would be called political norms. i don't care whether it's his -- the way he conducts foreign policy, the way he takes on the government agencies and how he deals with immigration, he brings his style now a lot of people, particularly those who voted for him and those who will vote for him again in the next election, like that style. i think what the democrats have to do is to be careful not to get caught up in style is stick trump and more in substantive trump. >> and johnson said that president trump's ability to dominate the news cycle puts him above the challengers. he said none of the democratic candidates appear to be enough, quote, in the center where most voters are

here's his take on newly announced candidate michael bloomberg. >> mike is willing to spend a lot of money. >> reporter: and he's going to have to? >> yeah, to make the case for potus, but more importantly for the money is his narrative as to exactly what he's going to do and how he introduces himself, particularly to the african-american community i think he's got to address the stop and frisk issue that was under his leadership when he was mayor of new york city, and i think he's got to let the african-american community know that he identifies with their issues, something that he's identified with it to some extent in new york and he's been positive on gun control and climate control and other things like that that benefit all of us. >> so interesting because i think that bob originally -- bob historically is a democrat. >> yeah. >> however, he has become -- he's -- president trump's sort of welcomed him into the white house. he spent time with the president. >> worked on him closely with some initiatives that he thought were very important for the

african-american community he said president trump welcomed him in, got to work on some of those issues and that's why he's become a supporter. >> so the question is -- that's why i wish we had him right here because i want to know if he was ultimately supporting president trump or if he was suggesting he might, you know, support michael bloomberg or somebody else otherwise. >> yeah. >> unclear. >> maybe we'll get him in to talk about that at some point soon yeah, definitely interesting when we come back, we've got some breaking news on warren buffet exclusive story on the bidding war he lost next. plus, we have full coverage of the black friday extravaganza got the names you need to know in retail. what it means for your money check it out right now you see walmart shares are up this morning other retailers pulling back slightly, but this does come on the same morning that you're watching the futures pull back as well. i've seen lots of days of green and lots of new highs that the indexes have seen. right now the dow is indicated down by 48 points. a little later this morning,

former representative barney frank and lanhee chen will join us to give their handicap. they show pete buttigieg is surging into second place. we'll talk a lot more about what bloomberg could do to this race and what's happening with elizabeth warren, too. stick around, "squawk box" will be right back. mmm... good. so i've spent my life developing technology to help the visually impaired. we are so good. we built a guide that uses ibm watson... to help the blind. it is already working in cities like tokyo. my dream is to help millions more people like me. but when i started seeing things, i didn't know what was happening... so i kept it in. he started believing things that weren't true. i knew something was wrong... but i didn't say a word.

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. good morning welcome to "squawk box" right here on cnbc i'm andrew ross sorkin along with becky quick joe has the day off post thanksgiving in studio, retail expert dana telsi. jan knippen. wwe. worldwide. back from the shopping malls already this morning we'll talk about that this morning. take a look at u.s. equity futures on this friday morning let's show you how things look like they're setting themselves

up down we think retail is up but the market is down dow is down 45 points breaking news this morning cnbc has learned exclusive details about a deal in which warren buffet's berkshire hathaway has been outbid the company is valued at $5.41 billion. that deal was sweetened from apollo's bid after an unnamed suitor topped the offer. that suitor was none other than berkshire hathaway buffet said one week ago he bid $140 per share or just over $5 billion a share. apollo's bid was accepted and buffet said he does not intend to make a higher offer tech data is a global distributor of global services

berkshire's cash award has been growing topping $128 billion according to the latest sec filing a lot of people wondering what he was going to do with that money. this move was an interesting pivot. he does not like getting into bidding wars it shows how he's going further afield in terms of looking for ways to deploy his large stash of cash. they moved quickly on this deal. they learned about it tuesday. by wednesday buffet had looked at it and thought it was worth $140 by saturday they made a formal offer. just taking the original contract that apollo had written up and changing just a few details to make it a little sweeter for the tech data side of things. anyway, it just shows he's moving very quickly trying to look for places to deploy capital. it speaks a little bit to prices in this market and valuations at this point let's get reaction to the news from peter bookbar

he's a cnbc contributor and, peter, what really strikes me with this is back in may buffet had told us he thought market prices for stocks were fair, that still beat anything you saw in terms of looking at the treasuries or anything else. but when it came to actual companies, to buying full companies outright he thought those prices had gotten bid up because there's so much cash out there floating around. >> right private equity on average is paying an ebitda almost 12 times. back in '07 it was not even 10 because we have all of this money that's gone into private equity because they feel that's somehow safer. granted, they've had great returns over the past 20 years you don't mark to market you look at last december, we talked about the decline in stocks private equity didn't mark to market their company all of this money is piled in. it's burning a hole in private equity pockets buffet is obviously more price sensitive than a private equity firm that wants to deploy

capital. what's interesting is for warren buffet tech data was a way of playing technology by being technology agnostic. they have over 100,000 different customers and products, ibm he chose who was going to win in technology apple he considered a more consumer products company. tech data, it doesn't matter who wins and loses in terms of software and hardware, as long as companies are using technology, tech data benefits. >> tech data, a little more information about it because i didn't know that much about it until i started digging into it, they are middlemen essentially. >> yeah. >> good tech bellwether to see who's doing what, when and where. right now the biggest product, apple makes up 16% of what they sell another 11% comes from cisco here are some of the big partners that they team up with. it is a good way of seeing what's happening in the industry and seeing what changes. i looked up an article and saying five years ago, four years ago in 2015 analysts were

concerned that apple was becoming a bigger player it was making up to something like 30% of the sales at that point and people thought it was going to be too hot. it shows you the fortunes of these other companies, big tech players that were out there. >> i think tech data has over 1,000 different vendors they're selling product for. whoever is up and down it won't matter. >> how much do you want to own the company to see what's going on >> you mean from buffet's perspective? >> find out if apple or somebody else -- >> maybe make the argument he owns so many other companies that have to use so many other services already that he should be able to have decent visibility into the world of technology but this gives you the direct sort of line. >> yeah. if you're going to sort of play that way without having to pick and choose who's got the better product, which is what buffet acknowledges that's not what he's good at, this is just an easier way of capturing growth in the technology space without having to figure out who's going to be a good product and what's not. >> i'm suggesting -- we were talking about you own it in part

so you understand -- >> right. >> you understand who's winning and losing. >> sort of insight into -- >> whether to buy more of it >> sometimes people say too good of an insight. this is something that's happened in the private equity space a lot. >> oh, no question and i'm sure with todd coombs helping out and broadening buffet's horizon in terms of the type of things he invests in this will be a huge help if they were to buy it and bring it in house. >> todd is the one who got the call from bank of america. buffet took a look at it and brought in greg able to do the negotiations private equity there's a company called cbc capital that bought one of the competitors to tech data for $1.8 billion it is an interesting area for private equity to get involved. >> the secondary issue that we -- >> no, i like it. >> but it's a little complicated. nobody really raises it but we

should raise it. some private equity companies are buying businesses that have great access to sales -- >> broad market data, stuff that people want. >> but now a lot of private equity companies that used to buy other private companies also have a public trading arm, right? so -- and there's not a chinese wall so they're able to say, look, this is really selling we see this. and then they're able to buy the stock of the other companies and then you have to decide whether you think that this is good, bad, fair, indifferent. >> i don't know. it's one of the reasons that i like having private equity guests on. the first thing they can tell us if they have 60, 70, 80 different companies, give me a broad swath of what you see. they have a good idea. >> i'm raising a different issue. >> privately telling other people -- >> what really constitutes inside information whether we think there's a fair playing field in the marketplace. whether we think my mother or father actually has the same access to information as an

investor if you have the access to research analysts, but in this case you have access to actual sales data. >> right. >> actual access to sales data, is that different? should you be limited in terms of your ability to actually buy into public stocks that are on the other end of these things? that is a whole world that has not been explored now that private equity has attached themselves, effectively, to some people call it the casino, but the stock market. >> so buffet owns a lot of apple stock. >> right >> apple's tech data is the biggest customer. >> insight into buffet, but i'm saying the insight issue and you have to decide what that -- how great that insight is or not by the way, you could argue it's just one slice in terms of the insight, meaning you're not getting -- you know, one retailer's insight is different than somebody else's insight and that's one of the arguments why you probably could -- >> i wouldn't be surprised if this would have been a platform for something bigger tech data, huge revenues but

tight margins. very low business. you need scale you need size in that business to succeed. >> peter, i want to thank you for being here it's good to see you >> happy thanksgiving. it is black friday according to shopper tracking, it's the busiest day of the year you're looking at live data. the mall of america where shoppers are already making their way through stores and looking for that perfect gift. we have every retail angle covered this morning court any ragan is breaking it down julia boorstin is looking at how digital brands are investing in a physical store presence and once you buy your figts, frank holland is looking at an increasing demand. i want to get to courtney first. good morning, courtney >> good morning, andrew. now we're sort of in the beginning of the second wave of shoppers, right? those door buster sales, those start now on thanksgiving thursday evening, folks go home, take a rest, come back out like you said, today is still expected to be the busiest day of the year for retail even though the cadence has changed

and stretched out a little bit 115 million americans are expected to shop at some point today, in store, online, or a combination of the two to give you an idea of how critical today is, according to 1010 data, black friday generated 7% of total quarterly sales for many retailers, like american eagle, like best buy compared to a normal day which is 1%. a week's worth of sales in one day. so what are shoppers looking for this year? according to cap at this phi, top search for deals as of this morning, amazon echo deal searches are up 420% followed by best buy laptop deals, amazon kindle deals electronics always a key category for black friday of course when it comes to brands, the top search for brand as of this morning is h&m then it's followed by the big tech name. apple with air pods getting 40% of the searches, amazon and

microsoft. now thanksgiving did see a big increase in searches for costco, but that also probably led to some issues, some intermittent slowdowns and then actually the cost costco.com website not being available for a period of time on thursday morning. h&m also went down for five minutes on thanksgiving though it does appear to be back up and working now. home depot had some slow load times. for now i'm going to send it over to julia boorstin with more on the direct to consumer market hi, julia. >> hi, courtney. clicks to bricks is the rising digital first brands investing in physical stores it's epitomized by glossier. it now has 2.4 million followers on instagram it opened up one in 2016 and one in los angeles this year it hosted five additional pop-up stores glossier's stores get free marketing tagging them in 20,000

instagram posts every month. that doesn't include all the tags in instagram stories. the company says the stores have a halo effect with a glossier canyon, a very instagram friendly image driving shoppers to post and more people to shop online now glossier which said it had more than $100 million in revenue last year is one of a number of digital first retailers benefitting from a physical showroom along with warby parker, casper and others. oliver chen said it makes sense as the cost of acquiring customers online increases the cost of retail space has declined let's get over to frank holland with the look at the battle of faster shipping. frank? >> reporter: thanks a lot, julia. best buy increased its logistic spending by 90% last year. it's maintained the level of spending as it continues to strengthen the supply chain and get it to 99% of the customers

what we know overall is it the industry is increasing the spending amazon expected to see a $3 billion increase in costs from offering free next day shipping this year. walmart it acquired jet.com in 2016 for $3 billion to boost its logistics. it is expected to see its costs increase by $215 million this year by offering free next day shipping so we know that spending is it increasing overall, but best buy says its plan is also focused on long-term savings and sustainability behind me is a custom boxing machine. this machine has long-term cost cutting benefits >> you look at the packaging and the materials and you save there. what people don't think about is that if you just look at the profile of these, i could put about three of these in the same space as this one. so ultimately that means we're filling up less trucks, putting less trucks on the road and then on some of our air shipments it's fair to say we're putting

less airplanes in the air. >> reporter: and the company said it's cut its cardboard waste by 40% the savings from shipping says it can reduce its spend with companies like ups and fed ex as well as xpo that handles deliveries of large things such as appliances. >> frank, thank you so much. master card credits a stable economy and lwe have steve sadof with us. he's a senior advisor for master card dana telsi is joining us as well and jan knippen is joining us. steve, we just heard from the national retail federation in the last hour talking about how they're looking for up 3.8 to up 4.2% both dana and jan thought we'd

take the high end of that. what are you anticipating? what are you seeing out there? let's talk this through with n dana and jan too. >> it's calling in the 3.5% range. it's a healthy consumer. last year you saw some very good numbers coming out of the master card database. you had a little bit of a conflict between the government numbers and some of the master card spending numbers. i think it was a very healthy holiday season last year probably not going to be quite as healthy as last year 3.5 to 4 versus 5 last year. overall we see a good consumer don't believe we've seen much of an impact on the tariffs yet that's still to come if, in fact, it were to happen, but overall i'm feeling good about what i'm seeing with the consumer. >> steve, you've always talked about omni channel and how important it is, how retail's evolving what are you seeing this holiday season that will be different than holiday seasons past

regarding convenience? >> well, i think the reporting that you just saw is telling the story. omni channel is critical consumer wants the product anywhere any time they want to get it and fast and the companies that have made the investments in the infrastructure, in the shipping, in the analytics are the ones that are winning right now and it's getting faster and faster and the consumer's changing faster than some of these legacy companies. >> jan, what do you think? >> steve, who do you think is winning and losing here? i keep talking about walmart, target, best buy being the winners, the big box guys. how do you see that shaking out as far as what's -- what we see going forward and who gets hurt the most by the tariffs? >> well, i think starting with you have the big boxes that you talk about are winning you also have categories that are winning and losing this year apparel is having a weaker performance the electronics, the hardware. the jewelry are performing quite well clearly the big box players within that are doing the best

i think that some of these digitally native brands, we talked earlier about the digitally native brands that are opening up a lot of stores they're winning. the resale is winning. the rental is winning. and i think these niche specialty brands that offer a unique story, they're winning. they have a sustainability story. that's winning it's the legacy companies that haven't evolved that are having a tough time adapting to this environment are the ones that are losing. >> hey, steve, i feel like we've been talking about how apparel has been having a rough time in the last -- >> apparel last year actually had a pretty good year it was up 6, 7% so you saw voedown over the course of the year fast fashion is not doing well anymore. >> like h&m? >> the younger consumer is not as much into stuff they're into experiences so you saw the forever 21

bankruptcy so the experience is becoming more important the specialness of product so i do believe that you see shifting tastes. the luxury category has shifted as well. you don't see as much growth out of luxury. a lot of it driven because of the experiential economy doesn't mean that individual brands aren't doing well jan made a very good point earlier that when you talk about department stores, for example, those aren't necessarily perceived as brands like a louie vuittan, prada or gucci. they still want differentiated product. companies delivering against all of those dimensions are doing exdree extremely well. >> jan, what was your thought just in terms of the tariffs, who this could hurt or not hurt? are we going to see some retailers that actually have profitable sales and others who don't because of those tariffs

>> i was going where matt shay was a while ago when he was talking about it because when i look at it i say big players with great supply lines are going to win smaller players without the ability to really push the supply line, they're going to lose, and the market share's going to move. amazon, walmart and target i say if you're not one of those three, you're probably losing market share unless you're a very small niche player of some sort and i also say all the time, and i still think this is true, online, off price, off mall discount rental, resale, and local are winning. on mall full price is dead >> hey, steve, very quick last question if something happens that the tariffs are -- the additional tariffs on december 15th do get put on, would that change your outlook for what you're anticipating this holiday season it does sound like you're expecting the consumer to be pretty healthy. >> it would affect me. i think the tariffs if they come

on is another tax on the consumer the consumer's 2/3 of the u.s. economy. i think there's some from guilt the -- fragility there. jan is right, the big guys will fare better but overall a tax is a tax. >> steve, thank you for joining us dana and jan are going to be with us for the rest of the program. before we head to a break, i want to check on the markets it is a half day on wall street today. futures are in the red we have the dow looking like it would open off 45 points s&p 500 off 4 points nasdaq off 15 points when we return, will the debut of the irishman hurt the thanksgiving box office or not we'll discuss what that film means for tfnelix after the break when "squawk" returns. sundown vitamins are all

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and i also do my own carpentry. >> oh, i'm glad to hear that >> that's code, by the way, for those who saw the movie. that was a scene from martin scorsese's "the irishman." it by passed the box office release and was streaming on netflix. i want to bring in zach fuller, senior media analyst at media research good morning to you. >> good morning. >> i shouldn't say i finished the film i watched actually two sittings so far and i've got more to go, zach the real question though is whether we think this is actually taking away from the weekend box office in terms of people going out to theaters. >> it's taken away from the weekend box office what does this actually give to netflix? they need to prove their subscriber growth model is still robust after they had a hiccup earlier this year after they saw

the first decline in u.s. subscribers in eight years what does "the irishman" do for netflix? does it bring them over offer is it at the expense of the box office. >> do you think they're going to get new subscribers? do you think anybody on wednesday morning who was not a subscriber who turned it off said, i'm turning the service back on? or do you think this is a game of trying to avoid churn and prevent people who might have been thinking about turning it off from doing so? >> all comes down to peek attention. when netflix was first bringing people over to its model, this isn't netflix, gaming companies, streaming services, are they bringing those subscribers over to the model does an epic such as "the irishman," they've gone in other cinema, this is a test whether they can compete. >> what's your thought about

whether they can >> but also are there games, streaming services, music? excuse me. can you repeat that. >> what's your handicap of the situation? meaning, do you think you're going to see at the end of this month much better numbers in terms of subscriber growth as a function of "the irishman" at $12.99, $14.99 in if you're in 5k, do people say, okay -- new york city, that's one ticket to go to the movie theater >> with no popcorn. >> with no popcorn. >> this game is becoming far more zero sum at this stage. you're now competing with gaming companies, with music streaming services the question isn't more so -- rather less so are people going directly to the movie theaters, it's are they spending their attention over there we won't really know in terms of netflix's business model until the next quarter whether or not those subscribers or rather "the

irishman" has brought more subscribers or caused more to stay. >> right the other piece of this is wha it does to the theaters. i assume that theater traffic will be down but how often do people go to the theater to one film and then go to -- it's not like a razor blade model where you're going to multiple films you're going to a film -- unless you're sneaking into the second film. >> people don't do that. >> do people go to the movie theaters still i don't go to the movie theater anymore. i'm wondering how much damage this is doing. it also damages retail when you look at how much is going to subscription services. so you pay $14.99 for this, 1 . 12$.99 for that. the phone bill is $300 that's coming out of retail sales. now there are i'm going to say a gi gillion only because i have hyperbole. there are a gillion things you

can subscribe to. >> look at tv sales. >> honestly, i want somebody to curate it and show me the best on now the idea of switching back and forth, are you kidding me? i want my cable box back. >> there were a couple of people saying we're going to turn hulu off, turn show time on, turning this one on. they go back and forth. >> oh, my gosh. >> not keeping them. >> i can't even keep up with what's on. >> that's too much brain damage. i can't do that and i'm not going to do that and neither is anybody else going to do it long term. >> maybe not. >> you'd need an app that does that for you. >> that you can pick and choose. >> by the way, goldman sachs owns a thing called clarity money. it's an app part of drk i don't know if they've rebranded it marcus yet it's in that new world of theirs i don't think you can turn the service back on, but you can go through the subscriptions on the app and turn them off. >> that's good

that makes it much easier. >> tell me the best of so i know which one i haven't seen yet it takes way too much brain power to figure out what's on these things and what's next how many people say, hey, tell me what to watch because i can't find anything. i have all of these services and i can't find anything. >> convenience and seamless. >> the other thing you brought up is the individual ticket. when you take your family to movies. >> it's over 100 bucks. >> versus sitting home it's the national debt. >> you have to mortgage your house. >> and the popcorn and other things that are three times the price. >> thank you for playing along happy thanksgiving to you. >> happy thanksgiving. when we come back, we've got your business travel forecast and then the resilience of the consumer with the holidays here, steve liesman takes a look at the state of the economy "squawk box" will be rig bk.htac 'n campus for the official visit. aflac! coach saban, how is aflac's program different from health insurance? well aflac gives you money directly, for things health insurance doesn't cover. aflac!

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toyota let's go places. johnsbut we're also a cancer fighting, hiv controlling, joint replacing, and depression relieving company. from the day you're born we never stop taking care of you. and welcome back to "squawk box. i'm meteorologist michelle grossman with your business travelers forecast the storm coming on shore. the quick glances at satellite and radar. a lot of impact in the business travel where we see the blue, that's in snow we're seeing heavy rain in southwest arizona, also the

northwest. this will continue as we go throughout the day and continue into the weekend let's talk about winter weather advisory this will no doubt impact your travel on the roads, also in the air. we have winter storm warnings, winter storm watches also blizzard warnings that includes rapid city air travel, we are looking at the possibility of a lot of delays across the country. this is a coast-to-coast storm it's impacting many on friday and then again on sunday as we get back to work as well so that pacific storm moving to the rockies impacting parts of the inner mountain west and severe storms in the northwest the northeast is looking pretty good high pressure and control, lots of sunshine. look at the possibilities of some delays. kansas city with showers and thunderstorms. oklahoma city down to dallas, even st. louis and houston that will continue to the southwest. so we are looking at the possibility of some delays as well you're watching "squawk box. we'll be right back. the world .

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welcome back to "squawk box. black friday is almost one of the most important retail days of the year, but this year it may be more important for u.s. economic growth. steve liesman joins us now with more i'm very surprised by this i don't want your coffee, by the

way. >> thank you >> because these folks have said that actually today may not be as important as historically it has been. >> it's not. the five days, the period. my main point is consumer spending relative to the economy. u.s. economy more dependent on consumer spending than it has been in five years this black friday may well be shop or we'll drop as economic growth could be flat or negative without a strong consumer. here's the math idea this is the way it's been the past two quarters. we look at economic growth and we take out consumption growth it would have been deeply negative i don't have that -- >> not a recession because it's not new a row. >> awfully low we ekquilibriu eked out a smalln you can get rid of consumer growth it's other parts of the economy that can overcome it in a slowdown in consumption. you have to go back to 2015 or '16 for a time when the economy

was relying on the consumer. the same thing then as now a slowdown in business investment and investment. we had a welcome rebound in business spending and an easing in jobless claims. october spending was decent but income was flat. take a look here overall spending has moderated since august we had a nice bump up in the summer now down 1 to 2 percentage points the consumer benefits, low unemployment, sentiment is high along with the stock market. that helps a lot shapes up through a good holiday season that's especially important because right now we need it to keep growing until we can turn around business spending you remember last december the worst december for retail sales. >> terrible. >> since the great recession and things weren't terrible going in but we had a lame -- we had a selloff on the stock market and we had the interest rate hikes with the fed. >> stay here let's talk about the resilience with the consumer. joining us is brian levitt global strategist for north

america at invesco steve is sticking around we have dana tulsi and jan knippen. how does this play out in terms of what you do in the stock market >> the consumer does have a lot riding on it we have to remember all of these periods where we talked about the consumer being the big driver was the result to steve's point of business investment being quite weak as a result of policy uncertainty so in my mind we are getting to a better position on policy. the federal reserve is easing. dare we say incremental progress on trade there will be fits and starts. the consumer is healthy. the policy situation is better we're not expecting lights out growth but we don't need lights out growth. >> advocate. what if those tariffs come in? >> so if the tariffs come on, then -- steve, what we need is some clarity on policy so protectionism in and of itself creates inefficient

economic outcomes. >> the business can deal with it once they know what the layout. >> we just need to know the rules of the game. in actuality, the irony of all of this is weak growth, benign inflation, the fed having to be on hold for as long as the eye can see or ease policy all of that should be good for the equity markets. >> we have seen some numbers very recently that suggest maybe business investment is picking up do you think we've seen the drop >> the yield curve is inverting. that is peak uncertainty that is peak weakness in the u.s. economy or trough weakness in the economy rates up a bit the yield curve steepening a bit. all of that is improving policy backdrop which is supportive for business back drop and business investment we shouldn't expect this to be lights out we're going to be dealing with the uncertainty in trade for a long time.

it's the incremental progress that is helping business investment, helping growth and helping the markets. >> can i ask dana a question >> sure. >> you're so hyper focused on the stores, like down to the shelves. >> right. >> if you were to tell me what your 40,000 foot view is, when you think about going into the season, what indicators from the consumer are you looking at that tell you, hey, we're going to be in good shape this christmas >> couple things i'm looking at disposable income growth i'm watching the savings rate. that's what i wanted to talk to you about also. >> it's up. >> exactly. >> which is a concern. >> so here's the deal -- >> it's also a positive. >> yes >> this gets to jan, right >> right so they have money and this becomes this fabulous conflict every holiday season are the retailers going to be successful at separating people from their money >> right. >> that's really the contest that goes on >> it is. >> i've got it in my pocket and i'm going to go into your store. you can't make -- can you make me take it out of my pocket. >> at what price >> exactly

>> you know where i am do you have a job? will you keep your job if you lost your job could you get one paying just as much or more the answer is yes. >> absolutely yes. >> the stock market is -- >> can i ask you a mixed question we have this question about netflix. we are talking about all of the subscription services that everybody is buying. >> they take a piece >> do you think of them in the same way >> i think of them as consumption. >> straight consumption? >> essentially, you know, they're part of a budget >> consumer spending >> yeah. we've got to go. the companies that are the most successful are the ones who have figured out how to turn my costs into a monthly fee. >> annuity. >> because it goes onto the credit card. >> i know. >> and people direct pay attention. you might have been talking about show time or hbo, but people don't know which one is which. >> bye, steve. bye, brian >> time to work off that thanksgiving feast we'll talk about it. what it means. eaig aerhess rhtft t

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it smee has an update how about you? >> i'm guessing a lot of people will be hitting the gym. this is the start of the busy season for the sector. outside of apparel it's in september home cycle and treadmill. in the passing lane up nearly 11% from the ipo the company opened a new germany. it's hard for the holiday season planet fitness is at the opposite end the relate from just shopping.

maker of the famous bowflex. its stock is down 88% year to date sales have been very weak but the company signed on a new ceo last spring. analysts have it under valued. fitness sees the biggest sales and subscriptions right around new year's day becky? sk >> diana, thank you. are you hitting the gym after this >> no, going to work maybe after work, after i shop >> you're better than i am thank you. great to see you, diana. when we come back. will mike bloomberg entering the adce hurt candidates who are leing in the polls we'll talk about that after this break. keeping me from the things i love to do. talk to your doctor, and call 844-214-2424.

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a surprising jump to the second place in the polls is pete buttigieg and michael bloomberg is tied for third. joining us is lanhee chen and barney frank congressman, let me start with you. are you surprised to see mike bloomberg already jumping in to fifth place even though he only announced in the last week that he's going to be running for president? >> no, because what's more important than 5th place is 3%

that's a very low number he has a low number and he has a high profile name. so i'm not surprised that he's at 3%, which is a relevant statistic. what isn't measured by that, that's how many people are for him. i believe if you were to measure negatives, you would have by far the biggest negative there's a great deal in mike bloomberg's record that is a real problem for very many democratic voters. you know, i'm personally well aware of his opposition of financial reform 2006 he was calling for even more deregulation just before the crisis he opposed almost any serious regulation he has a record of raising money for tom delay so, no, with all of his money and his celebrity, 3% isn't a very impressive number. >> you don't think that he's going to be able to survive the democratic primary >> oh, no.

no i think, as i said, even more negative about him, more that will come out. i do think the most interesting statistic there is take the two candidates who have been talking about being more aimed at beating trump and more cognizant of the political constraints that exist on very far-reaching measures that's the -- >> biden and buttigieg >> yeah. >> they together have many, many more votes than elizabeth warren and bernie sanders that's the way it's focused. then if you throw in the others like amy klobuchar and even bloomberg, i think the interesting point now is that the view that says it's important for us to beat trump and to do that we have to avoid things that are likely to alienate people, like medicare for all which i agree is a problem. i think that's a sign maybe after obama's speech that a consensus is emerging or at

least a strong majority on the democratic side for electability, still with a very liberal program. it's interesting >> congressman, do you think -- i don't want to say democrats. do you think people, frankly, are as rational as you're considering? the reason i say that is people who are die hard bernie fans or die hard elizabeth warren fans, it's not clear to me that they turn around and say, actually, i really like that situation, i'm so desperate to get rid of trump that i'm willing to move over to somebody -- >> no, you're right. the point is not what the die hards think but how many there are. look at the numbers. look at biden and butd at this geg and throw in klobuchar and bloomberg. elizabeth warren is a very intelligent, very smart candidate. she tried to move off of medicare for all i don't think she did it as successfully as she was trying to do.

she understood that. there are differences between her and sanders on this. so, yeah, i do think that a majority of those who will vote on the democratic side -- here's the issue. usually the most ideologically motivated are more likely to vote in primaries. antitrump feeling is so strong among democrats for very good reason that it becomes an equal turnoutdriver with the usual positive oh, we must make enormous changes. >> lanhee, what do you think of this there does seem to be a battle for the soul of the democratic party. >> i think there's a lot of appeal to the far left policies, but i think what you're seeing is that people are waking up to the fact that what elizabeth warren is saying as medicare for all, simply won't fly in a general election beyond that, i don't think it's what people want personally. the interesting dynamic with

bloomberg will be once his advertising starts to take hold, once people start to see his liberal bonafides around gun control, regulation, climate change, i think his numbers will improve. its think it's inevitable that when you spend that kind of money and you're the only candidate that has the financial wherewithal to play in all of these states that are going to be competing in the super tuesday primaries, which don't happen until next march but are still going to be an important part of the process, i think bloomberg is going to be a factor in this race, no doubt about it >> in terms of being a factor in this race in terms of pulling the party to the center or in terms of actually being a candidate that could emerge with the democratic nomination? >> well, i think first of all inevitably what his money and what his involvement in the race will mean is it will return the throw way of the party back towards the center in this race. i don't think it's going to be the case that he's going to pull things to the left in terms of whether he can win

the nomination, it's an unprecedented strategy to say i'm going to avoid iowa, nevada, new hampshire and south carolina and opt to compete in a series of states that don't go until march. it's an unproven strategy. frankly, if you're mike bloomberg, that's the only strategy that works. pete buttigieg, the reason his numbers are where they are in iowa where he's leading according to a lot of recent polls, he's had the time and energy to put in there bloomberg doesn't have that luxury i think he could compete i don't see him being the nominee at the end of the day but i think he will compete. i think he will end up changing the dynamic in the primary as we move into those super tuesday states come early march. >> congressman frank, we appreciate your time lanhee, we appreciate yours. we have to get out of here everybody says pete buttigieg is their second choice. would you be okay with him as the first choice >> well, emotionally obviously i'm very strongly attracted to him, and it's a very good sign

about america that this openly gay candidate, his impressive, articulate approach outweighs any prejudice. it's a sign that prejudice is diminishing. i am not confident that it is completely there let me just add by the way, the premise for -- bloomberg is not pulling the party to the center. he is hoping to catch on to what was already happening. >> i hate to cut you off but the hour is ending we will have you back to talk about it thank you very much. when we come back, we'll talk retail names and so much more on this friday. "squawk" returns in a minute also a deal that buffet was involved in but was thwarted back in a moment breaking deal ns

warren buffet loses out on a deal. and "squawk" goes shopping >> ho, ho, ho for me. >> gearing up for big sales. we check out what's on amazon. we have a few gadgets topping our list. >> can elon musk take a joke poking fun at the cyber truck. the final hour of "squawk box" begins right now.

good morning welcome to "squawk box" right here on cnbc i'm andrew ross sorkin along with becky quick joe has the day off today. joining us for the rest of the program, they've been here since the very beginning dana telsi and jan kniffen is here take a look at u.s. equity futures at this hour we are, i believe, still in the red. marginally better than before. dow off 35 points rather than 45 points s&p 500 off 4 points nasdaq looking to open down about 13 points. let's also take a quick look at treasury yields on this friday

morning as we flip that board around you're looking at a 10-year note at 1.769. we also have a little bit of breaking news on this friday morning. cnbc has learned exclusive details about a deal in which warren buffet's berkshire hathaway was out bbid. tech data said it was out bout by $145 a share. that deal was sweetened from apollo's original bid of $130 a share after an unnamed suitor topped the offer it turns out that was none other than berkshire hathaway. buffet said he bid $140 a share for the company. that would value tech data at $5 billion excluding debt apollo's final offer was accepted by tech data as the better offer buffet says he does not intend to make a higher offer it supplies small companies with technology software and hardware made by large companies, large technology companies, a

middleman in this entire situation. i think what's interesting about this deal is it speaks to berkshire's cash hoard it's been growing. this move is an interesting pivot for buffet because he rarely goes up against private equity companies or just about anybody else he doesn't like to get into bidding wars and he has made some comments about how he thinks buying whole companies earlier this year he said that was a really high premium. he didn't think it was worth it, which is why he's been putting so much of his money into stocks like apple this move shows he's gone a little further afield to look for ways to deploy his large stash of cash. joining us is mike santoli coming to us from the new york stock exchange this morning. mike, just in terms of where we should look at this, private equity, what it means for the car war with buffet and market valuations overall >> reporter: yeah, first of all, the kind of business that tech data represents is pretty reflective both of the type that private equity would like, which is steady.

it's not very glamorous. it hasn't been growing very fast and modestly developed it has not been embraced but you have some up side if you want to leverage it for private equity and improve the operation. there was value there, in other words. when it comes to buffet, it would only have represented 1/20th of the cash he has sitting there. the idea you have a pretty good business that's been around, pretty defensible type economics and why not get involved because the valuation, even at the in initial acquisition by apollo doesn't seem very demanding. that makes sense what you've eluded to, he does not want to go toe to toe with private equity he has a different time line and horizon. he doesn't feel like he has to get involved with multiple bidders. wants to be the preferred buyer of good assets it makes sense that it was the kind of company that he would look at. the manner in which it happened is a little bit unorthodox or

out of character it definitely tells you something about the scarcity of opportunities of very good but modestly valued businesses that a variety of strategic or financial buyers can grab. >> the details of how this deal came together, buffet's deal on this entire situation are interesting, too if you want more details look at our story online at cnbc.com he found out on tuesday. bank of america was shopping this around. it was part of a go shop deal -- aspect of this deal that they had to go look for other buyers. bank of america called todd combs, one of the top investors at berkshire hathaway. he gave it to buffet buffet thought he would bid more than $140 a share versus 130 apollo agreed to buy the company for. greg able, vice chairman, flew down to clearwater, florida, melt with the company and they had made a formal deal stream lined the entire process. took the contract apollo had,

sweetend a few of the details. they didn't bring lawyers into it which is why it was able to move so quickly. that's kind of interesting, too. >> it's very interesting, becky. it also tells you what buffet's tactical advantage is in general, not just with this deal the ability to just kind of make a decision, take a look at the financials and arguably write a check within a few days and just get moving on that is something that i do think in typical deals is going to be an advantage and one of the reasons i think bankers would bring things to him first if they were looking for that kind of tidiness to an outcome. >> andrew, you've looked at it, too, in terms of private equity, what it means. >> the two things that are surprising to me, a, that they even went to buffet and that buffet engaged, not because of the value of the company but because it was a go shop and he historically avoids auctions this is the ultimate version of an auction to some degree, but i do like the idea, i think there's a larger issue we've talked about in the last hour of buying a company like this that gives you a remarkable line of

insight. think about this for apollo. you're going to be able to see what sales really look like across the board in tech land in a way that most other investors can't. as a result of that, if you play the public markets, which by the way apollo does to some degree, you will have access to really great information that mom, pop, everybody here doesn't what does that mean? by the way, buffet has probably had access to information through the years given that there's flow through blackstone, same story this is a whole other sort of piece of the puzzle. i don't think that apollo's buying it for this purpose per se but the idea that you could buy a company with remarkable insight and what that means about your ability to buy into stocks and public markets as a result. >> tech data, i don't think we explained it, tech data is a middleman. >> yes. >> that sells other products like apple most of it coming from apple then they have -- cisco i think makes up 11% of the products

that they sell and then hughlett packard enterprise is another. >> you should know before the end of every quarter how apple is doing on a relative basis or at least you should have a better sense of how apple is doing. >> with smaller customers. >> with smaller customers than just about anybody at this table. >> mike, thank you for joining us it's good to see you >> meantime, we've got full coverage of the black friday shopping holiday season and deed dre bosa joins us. we have kay rogers covering the other holiday winner restaurants. let's start with courtney ragan. she's covering the mall traffic in woodbridge, new jersey. courtney >> reporter: hi. good morning, andrew the cadence of what we see for black friday is changed as you have the door buster deals starting online early on thanksgiving day, in store later in the day on thanksgiving day now in this lull this used to be the pbusy time before the shoppers come out it's still a very important day

for retail, likely the most important day according to mpd and the national retail federation you'll see 165 million shoppers hit stores and online this entire weekend 115 million today making it the busiest day of the year here so a lot of the shoppers that you see and that we've talked to, they start at the big box stores on thanksgiving afternoon. they get the door busters. targeted shopping. then they go home, rest, that's kind of where we are right now before they've recharged, eaten, come back out to do a little bit more leisurely shopping and a lot of self-gifting. like i said, black friday is a very important time of the year. alex partners helped cnbc with an analysis with what it means for retailers. in 2017, 15% of holiday sales for retailers was done on this thanksgiving weekend last year it was 13% this year alex partners is looking for that to be around 12%. why has it fallen? two things number one, the early black friday deals have pulled sales forward and this year you have

six fewer days between thanksgiving and christmas so you have a shorter period of time for these sales to be taking place so what are shoppers looking for so far according to adobe, some of the top stories for toys, frozen, lol surprise, paw patrol gaming, madden nfl '20 nba 2 k 20 and nintendo switch and also air fryers is this year's instapot. my colleague deidre bosa. >> we were just commenting on those air fryers amazon holiday strategy has always been cheapest and fastest. but as walmart, target and others up their ecommerce games, amazon may be losing its earning. i looked at two items on becky and andrew's list. andrew, you're in the market for a color printer with wireless capability we looked at the cannon pixma model g4210.

it is pretty much the same price across the major ecommerce shops but amazon with a slight 99 cent advantage. we went to delivery times. amazon comes first with one day shipping andrew, you would get that printer on monday if you order it today but not necessarily the clear winner because remember you have to have the prime membership that costs $119 a year if you're okay to wait a day, walmart will get that to you on tuesday, no membership required. best buy on wednesday. becky, your item was far more straightforward. a countercade pacman gaming unit the best deal had to be at kohl's for $149.99 on amazon it was only available from third party sellers only starting at double the price guys, this isn't exactly a comprehensive look but it does suggest that the ecommerce holiday battle starts to heat up especially with one day shipping also why we continue to see growth at amazon's core business >> selfishly, i can only get 99

cents off basically this printer? that's all that's available? so sad >> yeah. it's a pretty competitive product. 99 clint discount. if you have the prime -- >> i do. i'm going to ask our audience because we have a lot of clever people out there because i need to get a printer for the family. if you think there's a better printer at a better price. >> you're so cheap. >> no, i want a deal. >> the kids need a printer that does glossy and can be done for hallmark, color, let me know i want to know >> deidre, can i say you are saving me. i often think of amazon as my first and only shopping stop that i'm going to do if i'm shipping something from online what you're talking about is going to save me a whole lot of money if i look around for something like that. >> yes. >> that's not often the case that's a big deal. they just don't have this? >> well, i have a question for you, becky

where did the countercade idea come from? it didn't seem like a super popular option maybe that's why they don't have it >> no, it was for a story that i did for "on the money. we had a woman who came in who's a great toy expert who looks at all of these things. it was one of the four toys that she said will probably be a hot seller for this season i took it off of that. yeah, i do want this >> that's a great gift >> it's an example where a walmart, target, kohl's, one of these other guys actually gets a better exclusive deal. when you lock up exclusive deals you're not going to find it on amazon. >> that's right. only third party seller. so when you get to shipping and everything, that's also a lot slower so you're paying more, waiting longer it was surprising to me as well to see kohl's and other retailers had a better deal. >> can i ask one more question >> of course. >> what the heck is an air fryer? we've been talking about that. what is this >> well, courtney's probably in a better position to tell you but from my understanding, i

don't use it yet i have heard lots of buzz around it you basically -- it's like deep frying food but healthier. you put it inside of a machine it air fries, but it takes like deep fries. >> air burning which it's better quality. thank you for doing this work and thanks to courtney. >> my pleasure. what tech products should be on your wish list this black friday joining us to bring the best of the tech is todd hazelton. he's technology product editor andrew, this is you. i'm sorry. >> you know i love this stuff. i'm like a total geek. >> me, too that's what i live for >> you have the headphones i don't want to take you out of order. >> real quick. i've reviewed dozens of stuff. these are my favorite that i've played with. air pods pro already i told you when they launched, they sound great, they have noise canceling. they are $250.

>> easier to drop. >> a lot easier to drop than the old ones. >> buy apple care. 29 bucks it's worth it. if you need to replace them, you can -- >> what if you lose them >> even if you lose them. >> really? >> for 29 bucks. >> for how long? >> i think it's a year. >> worth it. >> apple care plus i don't know -- >> are you sure about that >> yes. >> when's the delivery of those? >> that's a good question. last week we learned apple has pushed it back to december 30th earliest but amazon has them on sale. we go back to amazon for $15 off you can get them before christmas. so that's actually the better place to get it. there was a report last week that apple has seen such high demand that they may be increasing production from 1 million to 2 million a week. >> that means we'll have to get these. >> you can still buy the regular air pods and get them before christmas. >> real quick, how do they do on an airplane? >> great

>> i used to use the big bose q 35 these do almost as good. >> for road warriors, you need a dongle. >> if you want to collect to the in flight stuff. >> in flight matters you know about the dongle. you stick the little thing in? >> yeah. i'm using my -- >> buy it from apple >> you can buy it from apple but belkin and other companies -- >> you have a big speaker. >> that looks like the apple. >> it's not an air fryer. >> this is amazon's echo studio. it's the best echo i've ever heard. better than a home pod, i think. it has a crazy 3d audio effect mere's the kicker, thisis amazon, very good at getting you to subscribe to things you have to subscribe to amazon music hd to get the better sounding music tracks. >> using spotify it doesn't sound as good? >> it doesn't do the 3d audio

effect there are only a couple of songs. >> how does this compare to my s sonos 1. >> it's better it's awesome it's worth considering it does everything else an echo can do this fits in better if you have other echos. you can play music in all of your rooms and stuff like that >> where is sonos? >> this is 200 bucks. >> how big is that library going to be? a couple hundred is not much >> right expanding to thousands of tracks there are millions of songs you can listen to. spotify, pandora, tune-in music. but if you wanted the extra 3d radio, you have to pay a little extra. >> what is this? >> this is the google nest home hub max. it looks like a digital photo frame but it's a lot more. it has a camera but doubles as a security camera when you leave your house.

>> i like that. >> it can recognize me right now it's going to say good morning, todd. >> that's creepy. >> right then it would tell me how long my traffic commute is in the morning. when i go into the kitchen, i walk past this, it says 45 minutes to work, an hour to work depending on traffic then it brings up my pictures. specifically pictures from previous years at this time. so that was in my kitchen showing thanksgiving from last year, six years ago which was really fun >> good morning, dave. >> have we reached the point of, good morning, dave. >> it has this, good morning, todd it freaks my wife out. she won't register her face. google says they store it locally so your face isn't everywhere -- >> yeah, right. >> my wife is like, no way. >> listening to everything and -- >> not just your face. >> there's a switch on the back that disconnects the camera and the microphone so you can turn it off. >> if you believe that >> but then you don't get those things when you walk by because it can't recognize you.

>> do you keep it in the kitchen, not in the bedroom, right? >> yeah. exactly. it's a kitchen gadget. you can bring up recipes, news stories i like in the morning, it recognizes me, videos i might want to watch, those kinds of things then we talked about the air pods pro then i had a stocking stuffer that's fun. >> what's that >> wireless charger. they work with the air pots. drop them on and they start charging it works with most new iphones. >> that is the most convenient >> they're like 15 bucks on amazon you don't have to buy a brand name this is belkin that apple sells. >> it charges fast >> it does, it charges fast. >> that's a big problem. >> how much does this cost >> 229 but on black friday for 200 bucks. this is $200 and it's not on sale because i think they know it's popular you can still get it before christmas. so, yeah, everything here except for the air pods. >> the kitchen or the bedroom. >> it's a lot of fun. >> wait. you want that for the bedroom

watching you are you out of your mind >> i bet you there are some -- anyway, i'm not going to say it. >> i think the air pods seem the most popular. >> don't hang out. >> seem the most popular everybody seems to be wanting these. everybody i talked to that didn't buy them already says they're on the top of their wish list for christmas. >> where can you get it before christmas? >> amazon. >> target, walmart i checked had them in stock. best buy has them in stockstill. you can buy them from retailers but apple seems to run out of stock. >> definitely don't want one of those. >> which thing >> no, that thing. >> the air pods are great. >> in your bedroom. >> not in my house period. >> what was that. >> divisive device. >> the russian roulette service people would go in -- >> yeah. >> chat roulette. >> chat roulette it was not -- >> it was not family friendly. >> not family friendly happy thanksgiving. >> thank you >> hit the online stores.

when we come back, can elon musk take a joke some major brands poking a little bit of fun at the tesla cyber truck. we're going to find out how next right here on "squawk box. thanksgiving is over the feasting is done, but for retail and shoppers, the work's just begun for both bricks and tricks, it's the make or break season we'll tell you who wins and we'll tell you the reason. and while you're out shopping, you'll go out to dinner. we'll tell you why rtaesurants are the other big winner ♪

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welcome back to "squawk box. s&p futures indicated off. the nasdaq down by 16 points of course, this comes after all the major averages set new highs once again on wednesday, the last day of trading. we'll see what happens as we get through black friday. in the meantime, let's take a break from retail madness. for that, joining us is ed lee

he's "new york times" media reporter and cnbc contributor. ed, let's start with some reactions surrounding tesla's new cyber truck. i mean, this is a dream to have this much publicity happen, right? he doesn't have to advertise or pay for marketing at all. >> exactly he got all of the attention he absolutely wanted even if some of the attention was negative. >> doesn't matter, just spell my name right. >> he calls it cyber truck for one thing. that in itself, you know, he's going to attract all kinds of commentary the demonstration with the cracked window probably was not in the cards. >> still, it may have played to his advantage. you see denny's getting on board, pepsi getting on board. we ran that footage of him cracking the windshield. >> great television. great television at the same time, more seriously, he's had these fcc violations in the past i've been watching how he's been acting on twitter. >> i have a question about this, too. when he tweeted the other day,

all he tweeted was 250 k. >> that was it >> he was originally referring to how many preorders for the new truck. >> is he that's what we assumed. >> then he updated it with 250,000. whether that's specifically the truck or some random number he's putting out there. it's $100 deposit. it's conceivable that that's likely the case. >> i thought the same thing. is that a violation of the sec rules? is he trolling by saying 250k so he can say, that's not what i meant. i was talking about how much i paid for x, y, z. >> i think it is a really carefully worded tweet in the sense that it doesn't -- >> evading the sec >> right right. what do you think, jim i see you waiving your hand over here. >> i think it's scary when he puts out tweets like that. i'm a big fan of the truck, by the way. i thought the tv was grade, like you said when he gets things out that are hard to determine and, you know, having sat on the starbucks committee, i look at it and go, wow, i don't think i would have put that out that way.

>> right >> already got in trouble. >> hard to know what it says. >> well, yeah, he's already been in trouble it's really confusing, i think, if you're the investor. >> it seems confusioning if you're the investor. if you're the consumer you're a love it or hate it scenario. that's what he's always playing to always playing to the consumer. >> the crowds. >> wall street is always a secondary concern for him. if you are an investor, that's the underlying or baseline concern. >> if you are the sec what should you do? >> in terms of that specific tweet? yeah, i think it's worth an inquiry. i don't know that it's worth -- >> what happens? they send a letter. >> they send a letter back. >> go back and forth. >> more lawyers back and forth. >> is that a lawsuit >> it's interesting if you look at what the judge said the last time around. they seemed to be somewhat sympathetic in terms of elon musk, freedom of speech. first amendment issue. >> isn't he allowed to say what he wants to say? >> the answer to that is no. >> a judge, if you read some of

the earlier opinions it was not clear which way they would ultimately go on it. >> i think we're entering this new terrain where it's not just musk a lot of the silicon valley executives are more used to communicating in these forums. it's the natural thing. >> it's not about the forum. the media is not the message the message is the message. >> it should be about the accuracy of what you're saying not using twitter to put this stuff out but the idea of what he was saying was saying this is a done deal. we have the financing secured. >> that was a specific -- >> that was a lie. >> that was a specific tweet and that i think more clearly violated sec -- was an sec violation. >> not about twitter. >> but i think there is this off the cuff mode, right, when it comes to these forums, that they're using that it's not an excuse but at the same time, you know, that's i think leaning in the direction of there's a more informal way of communicating and usually it's with consumers as opposed

to investors if you're an investor, it's not a good thing you don't want to a lie yourself. >> although i will say for somebody like jeff bezos, he's always taken the side of the customer and that will serve wall street. >> he's much more disciplined. >> much more disciplined. >> the background is -- give him this license to do it that way >> because he said it in his very first letter to investors. >> don't -- >> yeah. >> we're going to be in this for the long haul. >> you could argue in the very beginning maybe investors didn't give him the license. >> it's been up and down. >> he was a very tough guy >> right let's pivot to another story that we've been watching that's a popular social media app tiktok apologizing to a user she posted a video criticizing chinese treatment of muslims this is interesting because of tiktok's ownership. >> it is a chinese owned company. a media company, basically, going to call it a media company

the way twitter and facebook are media companies of gaining popularity outside of china. what's interesting is that the chinese internet is sort of like a closed off system. they had their own whether it's we chat or tiktok or others, it's always been a sort of a thing where there was a chinese version of everything you had seen outside of china. it had developed in a slightly different way and china, beijing didn't really care whether these services sort of made it outside of china or not. tiktok is the first to do that the direction of trade is only one way here, right? facebook, twitter, google is not allowed in china tiktok is allowed in the u.s. >> what shocked me is they actually apologized. >> they restored the account. >> and restoring the account the idea that they care, i mean, that is completely shocking to me you would think that there would be a zero tolerance policy. >> for that, yeah. their shift on that is interesting. also tiktok has a policy against any kind of political messaging

or advertising at all period there's a blanket. no political anything if you're a regular person who posts on there, i think the rules are different. but i think how they develop and how they adapt to sort of outside china usage, i think that will be interesting to see how that goes because ultimately what's their aim do they want ticktock to be like a global dominating force or do they just want something that's going to make money. >> there have been people who said you shouldn't use it if you're in the united states. >> because of security concerns. >> you hear something like this, it's like, oh, maybe there's a reason that they're restoring that account which is something i would never have anticipated. >> should i pull my 9-year-old off of that? >> yeah, that's something i've thought about with my kids, too. >> for whatever spying they want to engage in, they can look

through facebook or instagram. >> this way you're uploading it. >> you're uploading it straight to them. remember, social media is media. you want it disseminated, right? you are posting something with the aim to getting it out there to as many people as possible. you're not hiding anything that is the other thing. i think managing -- this goes for facebook as well, right? managing the populus, so to speak, that's always going to be a bigger challenge china always wants to manage the message no matter what it is, and i think -- i'm really curious where they're going to go. >> i was shocked to hear that they restored it that seems so uncharacteristic of anything i would have anticipated. >> right how this media works, what the aim is for tiktok, what the aim is for beijing, i think that's the question. >> happy friday. great to see you. >> going to go back and do some black friday -- i saw you doing it earlier. >> i think i'm going to open a tiktok account i want to. i want to get into lip syncing

battles. it's a lot of work snap chat was hard enough. >> no way. i'm not going on tiktok. >> "squawk box" tiktok >> "squawk box" tick it would be big. will santa claus visit wall street we'll find out what december holds for the markets. plus, check out a big winner, chipotle are there some other food stocks out there ready to gobble up "squawk" returns in just a minute

coming up, who's hungry. consumers hitting the restaurants this holiday season. >> reporter: hey, andrew heading out to shop. we're going to tell you much more after the break when you shop small you help support your community - from after school programs to the arts! so become a regular, more regularly. because for every dollar you spend at a small business, an average of 67 cents stays in the community. join me and american express on small business saturday, november 30th, and see how shopping small adds up. ♪ yes i'm stuck in the middle with you, ♪

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welcome back to "squawk box" here on cnbc we are live from the nasdaq market site in times square. let's get you caught up on stories that investors are likely to be talking about we have new details on charles schw schwab's deal to buy t.d. ameritrade it carries a $950 million early termination fee. they announced it on monday. t.d. ameritrade are $52.22

charles schwab is 49$49.95. >> i think there could be regulatory issues. >> because -- >> because of the -- >> because of the rai? >> because of the rais they'll own 75% plus of the market on that side of the world and so you have to decide whether that's a good thing or bad thing. what i don't know is is there some kind of solve, meaning in the same way that in a t mobile, sprint transaction i'm going to carve this out and sell this. i don't know if you're to do this whether it unravels unto itself i think people will take a hard look at it. >> german automaker daimler plans to cut 12,000 jobs worldwide over the next three years. it is the third german automaker following audi and bmw companies are facing slumping demand in china. online retailers like amazon

are being pressured by the ftc to remove fake product reviews to their websites. according to fake spot, more than 1/3 are fraudulent, meaning they are generated by robots or people who are paid to write them. we all know black friday is a major shopping day but how do restaurants fare kate rogers has more kate >> reporter: hi, andrew. you'd think with all of these people out and about on what is the biggest physical shopping day of the year that restaurants would be getting a big boost, but that is wrong. the npd group analyzed the holiday shopping season for 2018 and found black friday is the biggest day for restaurant volume and buying. these are the top five last year many falling before thanksgiving the group says that the traditional big shopping days are not the highest ranked restaurant spending and volume days with the exception of december 15th, which was less than two weeks before christmas. now the reason, of course we do

a ton of eating on thanksgiving and black friday tends to be a big day for leftovers. there are some beverage retailers like starbucks and dunkin' which npd group says could get a boost because there are a lot of beverage occasions on black friday. you are out and about so you may grab the extra cup of coffee we took a look at how restaurant stocks perform throughout the holiday season not much movement in the past five years the big winners were wendy's and dominoes. >> good to see you. let's take a look at chipotle versus the s&p 500 this year check it out the s&p is up by 25% for 2019. that's a huge gain, but when you put it next to chipotle's gains, that looks like not much chipotle shares have nearly doubled. joining us is peter sole, mapping director who covers restaurants at btig. good to see you. >> thanks for having me. >> we looked at the one-year chart of chipotle it's

impressive two-year stock is even more impressive it's up 200% you have a buy rating. why? what do you think this company is going to be doing and how will it continue to outperform >> i think it comes down to earnings i think the earnings numbers are moving higher. they've been moving higher for the past 18 months if not longer we continue to think $25 in eps is a totally achievable number for this brand it's really driven by two things, one, the top line is growing extraordinarily well driven by digital. their digital sales up 88% in the last quarter up into the upper teens. 18.3% sales digital and that's growing at a very rapid pace every quarter every year really has our loyalty program that continues to expand, as they roll out more of these chipotle lanes which are drive through restaurants and also the digital sales are higher margin. so you're seeing that flow through their second make line higher margins and top line growth

you're seeing that all flow through the bottom line. >> as you think about costs, labor costs, food costs, how is it impacting chipotle? what's your second favorite name after chipotle >> i think labor costs are an issue for sure across the restaurant space food costs are fairly benign to be honest with you 1 or 2%. labor costs are up in the mid single digit range across the board for all restaurants. to be honest with you, when you are growing same store sales 11% or 10% and you have 2 or 3 basis points, that starts to offset a lot of that pressure they're seeing leverage on the labor line one of the few companies in our coverage that are seeing leverage on the labor line and leverage across the entire p&l other names i would tell you domino's as well having another great year for domino's as well capitalizing on the digital trend. digital sales for domino's up at 65% of their overall business. so, you know, they're growing

their unit counts, growing the top line same store sales and they're also growing eps numbers pretty substantially as well >> my question to you, peter, how much do you think this is about marketing right now. >> for chipotle? >> for all of them, actually how much of this is a marketing story versus just straight operations story versus the digital piece? >> i think a huge portion of it is marketing if you consider what brian did when he came in almost two years ago, he halted all the marketing that chipotle was doing. took them a quarter or two to get back on the marketing trend and they launched more national marketing. so they went from the grassroots marketing initiative to national marketing and that really drove a lot of the sales so it is good marketing, which has worked for them, but also capitalizing on the digital is shown to prove really across all of retail. >> peter, the other stocks you like are domino's pizza and then

texas road house, too. do these three stocks have something in common or is each one finding its own place? >> i think what's in common with domino's and with chipotle is really the digital trend so you're seeing, you know, chipotle at 18% and growing, you know, almost 100% every year on the digital side domino's is at 65% digital and that's growing but not nearly at the same pace given the penetration. for texas road house now i think it's -- they're not capitalizing necessarily on digital just a good unit growth story and finally getting their margins in line as they're taking some more price and being a little bit more thoughtful about how they deploy labor in their restaurants. >> last week john schnadder, the founder of papa john's, came out and said he'd been eating pizzas, 40 pizzas over the last 40 days. would you agree with that? they've lost their touch domino's, are they winning at

the expense of papa john's. >> we are buy rated on papa john's as well if you look at the last quarter performance, they posted a positive comp. the consumer doesn't think they've lost their touch and it seems like trends have turned for papa john's in recent so i think that's just one person's opinion. you have to look at the numbers and i think the numbers suggest things are improving for papa john's as well. >> who would eat 40 pizzas in 30 days. >> john would. >> peter, thanks for joining us. it's good to see you talk to you soon. >> good to see you, too. coming up when we return, should investors expect to see santa claus? that's the question. futures may be low right now will the markets continue to build on their record highs? that's next right ren quk x.he o theme park capital of the world, it also has the highest growth in manufacturing jobs in the us. it's a competition for the talent. employees need more than just a paycheck. you definitely want to take advantage of all the benefits you can get. 2/3 of employees said that the workplace is an important source

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welcome back to "squawk box. we're in the red, the market looks like it would open down. the s&p off 3.5 points the nasdaq looking to open down. can the rally be sustained through the end of the year? that's the question of the morning. joining us now is kevin monn, president and chief investment officer at henney and walsh asset management good morning to you. >> good morning. >> the question is, the answer is, i should say, does it actually run through christmas or not >> yeah. i think i hear bruce springsteen singing in my head now "santa claus will be coming to town"

and he's brought in presents this year already, up over 23% i think it is because of the strength of the u.s. consumer. >> that happens if december 15th comes an goes and there is no deal >> that's the biggest risk now, no deal and additional tariffs placed let's say for argument's sake that gets pushed off punted down the road >> how does the market take that >> very positively very positively. the fact that as we talk about black friday right now, we're forecasted to have holiday shopping sales 4% up year over year, online commerce up between 11% and 14% year over year that's the investment opportunities in that online commerce >> in the retail space. >> in the specifically in e-commerce and those companies that benefit from increases in commerce, including the credit card companies, payment processors, warehouses, the distribution centers, the distribution companies i think that's the opportunity. >> do you cover any of those companys >> watch lot of them it is super important. >> you're not in the warehouse business >> no. >> that's where you look at where the real growth in the

stock price has gone, warehouses have been huge. >> that's where the growth in the employment picture is too. retailers go down in employment, warehouse and transportation go up >> the industrial reits also. >> part of the commerce ecosystem. >> you think about going to -- let me ask you a separate question, which is i've also talked to some investors who have a view that we'll have a santa claus rally, everything will be great, people want to own some names, coming into january, it all turns. >> you have to look for other opportunities for alpha beyond january. one of those areas is biotech. we had 17 major announce deals thus far this year we just heard that novartis is planning on taking over the medicines company with this bipartisan desire, yes, i said, bipartisan desire to lower drug prices that squeezes the margins of the large pharmaceutical companies and they have to be inquisitive to be able to grow in scale. >> there is a sense all sorts of healthcare transactions or

biotech transactions in the m&a space. i wonder if this slows down come first, second quarter of each year because the election is coming and nobody knows what is going to happen. >> to that point, we're forecasting 10% additional growth in 2020 the bulk of that coming in the first two quarters of the year and until we get past november and know who will be in the oval office who will control congress, you'll see a lot of trendless volatility. >> in the stock market you're saying 10% for that >> 10% from now to the end of next year with the bulk of those gains coming in the -- >> the s&p, the dow? >> the s&p. >> you agree with that 10%? >> i would take 10%. that would be good for our names. we have so much uncertainty in consumer now >> i think consumer stays strong through the end of the first quarter. that's bolstering a large part by the fact unemployment, prices are only about 1.8%, so the consumer remains confident in their jobs, more money in their

pockets, they're going to spend. >> i don't know. i feel an election year is a tough year. >> it is going to a tough year as we get to the third and fourth quarter and we find out when the conventions hit, who the democratic candidate is going to be and what is the likelihood of that outcome. >> i've been surprised that the market has eased through elizabeth warren picking up in the polls, same thing with some of the issues. will it be as laid back about it next year if some of those names continue to dominate >> yeah, i think for portfolio managers like myself, the election is so far out now what is on our near term horizon is holiday shopping spending and what happens or doesn't happen on december 15th as we get through the second quarter of next year, we'll start focussing on the election. >> how do you feel about tech? >> depends on the areas of tech. revolutionary technologies, artificial intelligence, robotics, those are areas for growth big tech, a little sluggish going forward. >> thank you happy thanksgiving. >> you too >> when we come back, before you head to the mall, our guest host

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bell rings on this holiday shortshor shortened trading session. s&p futures down by 4.5. nasdaq off by 18 one more thing to watch as we head into the holiday shopping season black friday, here we are, it looks like it is going to be better than anticipated, really strong consumer. what is the one thing riding on all of this? jump ball who wants it >> i'm going for something else. tariffs are a big problem. if the market stays strong here, we're good right through the holiday season and the first quarter. >> that's a derivative of the tariffs question the market is betting the tariffs will not be put on what happens if they are >> our names, price increases can't afford the price increases, our stocks come in, everyone is going to try to evaluate what does it mean for the bottom line for 2020 we have easy comparisons in the first half of the year, december typically isn't a good month for retail stock prices, let's watch as we see as we go on, but we have a season that should be up

at least 4%. >> tariffs will not hurt the consumer spending through the end of the year. it will hurt the consumer stocks >> yes. >> it will hurt the -- >> the consumer doesn't care they will look at it, all they care about is the price. >> retailers raise prices or eat it >> they will not raise prices, because nothing happens. they will not raise prices going forward. there is a worldwide oversupply of goods, we're not going to see prices. >> manufacturers will share the price increases with the retailer >> to this point, it has been pretty interesting walmart, target, other big players said it doesn't matter, we can afford this, get through this, they have so many other places where they can pull levers and spread the pain out over different places. will that be the case if additional tariffs come on too. >> i'm hearing about mid to single digit increases for some categories like footwear depends on the categories. some furniture prices try to be increased, they couldn't pass the pass increases on. >> in general, walmart and target will spread the pain out overall the other retailers,

they're going to hold the price and take share >> jan, dana, thank you for being with us this morning it has been wonderful having you here and we hope you come back to tell us more about what is happening as we get through the season. >> thank you. >> that was fun. make sure you join us on monday have a fabulous thanksgiving weekend? >> yes. >> "squawk on the street" begins right now. ♪ ♪ >> good friday morning welcome to "squawk on the street." i'm david faber with morgan brennan and mike santoli, live from post nine here at the new york stock exchange. let's give you a look at futures as we get ready to open a shortened training session today, this day after thanksgiving we're looking for a slightly lower open on all the major averages european markets open for some time let's take a look and see what the tone has been like over there as you can see