"squawk box" begins right now. >> good morning. welcome to "squawk box." we are live from the marketsite on time square take a look at the futures this morning. surging after a record day yesterday. the dow close after hitting the 16th interday high s&p 500 reporting 27th record close of the year. dow futures indicated up by another 134. s&p up by about 13 points and the nasdaq indicated up by 44 points this morning. on the idea if a trade deal is done, you could see some more

room to run. as a result, you've also seen pressure on treasury yields. take a look at see what is happening with the treasury market some pressure on treasury prices the 10-year sitting almost at 1.891% yields, we watch them kind of skyrocket last friday after that job's report was stronger than expected they came back down after they made it sound like the fed will not be moving anytime soon with this additional news making this happen. >> going with every trade nuance up or down goes down, if it looks like the yields go down, if it looks like there is not a deal. we recover globally from the trade war. >> the two things of the fed and the economy. if the fed is on hold, the rates don't go up. if the economy are off to the

races again. >> it is a thankless job people at home they see the screen from far away they zoom in, and take it for granted. they think we are just changing the appiture >> there is a guy. >> he's running. he went running by, which startled me for a second, it was worth it, kyle you are going to do it again, aren't you >> kyle, we are going to get you to the big trade story of the morning. president trump has agreed to a limited trade agreement that would roll back existing tariffs on chinese goods in exchange, china will reportedly boost purchases of u.s. farm goods and obtain other concessions also obtaining a snap back provision. we'll get to eunice yoon now in

beijing with reaction on all of this good morning >> good morning, andrew. what is interesting is there hasn't been much reaction at all. the official state media hasn't said anything. commenting only saying a deal needed to be mutually beneficial i spoke to one government source who is course to the trade talks saying there is just some hesitation on the leadership because of the concern about hard targets for ago occg servis that could hem in the chinese and force them into a situation where they would be in conflict with other trading partners and who would see this as a reallocation of purchases and potentially lead beijing to more challenges of the wto. secondly, there is a concern

that president trump because of the u.s. politics in the campaign would eventually reimpose tariffs on china anyway and that china could then be stuck with large purchases or contracts for these purchases of american products but also get hit with these tariffs those are some of the main concerns people have and one of the reasons why at this point, the officials here aren't quite sure of the best course of action however, it was also pointed out to me many times in conversation today that at the end of the day, the communist party does derive legitimacy from the communist party. there is believe there are economic reasons why president xi jinping would sign off on this phase one trade deal because of the understanding it could lift the stock markets and

uncertainty about the economy here >> you are going to use the soybeans and the pigs. the famous other issues. i don't know what that means i don't it means there would be no other ip issues and other issues for phase two, phase three and phase four this is just buying some stuff which makes me think -- it seems like taking off the tariffs would be a pretty good deal for china. the navarro stuff, lighthizer, and steve bannon, this shows you how are we ever going to get that other stuff if they are even backtracking on buying the stuff from the other people. it is tough. >> it has been raised that china has been concerned it wouldn't be in compliance with wto regulations if it agreed to

this >> right that's exactly what they've been saying this one source in the government told me that there is concern that they would be not client with the regulations. >> they don't care about the other things >> that's what folks in washington would say but in china, especially within the government, they believe that they are client with wto regulations and that they don't do anything wrong. joe had mentioned that the forced technology transfers, that has not been acknowledged that that is something that china does, there is discussion of protection of ipr in this agreement. it is not some of the heavy lifting and difficult discussions over a forced technology transfer but instead

more pledges to protect property rights in terms of the faphase two or phase three, i'm sure you are finding this as well i'm hard pressed here to find that this phase two or phase three is going to happen beijing would be happy about a tariff roll back as you were talking about. they would be happy about having that delay >> if both sides need to save face, i think president xi looks fine here. president trump can sell it too. if you really looked at who is getting what they want, at least china is getting more tariffs coming off the ag products i think he could sell that >> it is seen as very delicate, joe.

that is your -- that would be your perspective that president xi seems like he's getting a good deal. what people here are worried about with the government is that it won't be perceived well in china they are seeing this phase one deal as a symbol of the relationship between the u.s. and china going back on track. there have been several people who said to me, what if the u.s. and not only president trump attacks china and congress jumps in what if there are more bills about human rights on hong kong than to china and the chinese public it could look as though leadership could agree to something that wasn't very good. stuck with these large purchases. they are getting tariffs reimposed on them. and they are getting hit >> why not cancel all of these >> i'll call my service and tell

them get president xi on the phone. >> i don't understand. why wouldn't they think the purchas purchases could be canceled? >> why don't they take it. i think they will. i kind of think they are getting a pretty good deal and they should take it i don't think we get much. >> i don't think we do >> on the purchases, one thing i heard was that the way that purchase would have to be made is that the government can't just buy all of these ag goods the government would have to state the companies to do it it doesn't reflectwell on beijing that after all this talk about market it would be perceived. >> and china is worried about directing companies. >> they told companies they can't buy u.s. product

they want them to no longer be buying u.s. technology from software to the computers they are working on >> there was another interesting point that i've discovered in this that is that another concern is that if these -- the pricing there is a feeling that the pricing on these isn't so competitive. ifs that the case, the government would be directin the state firms to make these purchases. that the state firms would be forced to buy at a higher price. we'd likely ask the government for subsidies and then the government would be hit by washington for offering subsidies to these companies there is a lot of nuance and headache that they have to consider when making this decision >> i don't envy any negotiators in the room on this. i don't know what i would do

my head would explode at some point. >> you are right in china, people have been comparing the pictures of the vice premier pretrade talks and now today. they are like, look at his hair. he looks like he's aged. >> i don't envy any of them. >> eunice, thank you for that. our next guest has been waiting patiently and watching all of this conversation play out china books international ceo. you were sort of making faces as eunice was speaking. >> he does that a lot. >> i hear that face trying to say. >> the face is trying to say that we've known there would be a baby trade deal. we've been saying that for months this is a head scratcher this is not anymore than an agg

purchase bill. is it possible is it a 2020 number? they can't do these numbers. the deal itself, does it really have a foundation. they don't really have a text. they don't want to make it public this is just a very, not a done deal yet >> do you think china is doing this as you would say, the bar is so low. >> exactly right why not do this? they are buying stuff they want to buy they won't have to publicize what they are doing. if they don't like what president trump is doing you think internally you could turn this off. you think eunice is suggesting

maybe they couldn't. >> eunice is right the issue that eunice brings up which is a good one. they are trying to talk about all of this nonsense it hurts their narrative to be talking about the state being directed to do this and the government directed to do that it will hurt their trade relationships elsewhere. there are issues as to why this isn't easy, easy it is worth getting done >> just looking at what is going to happen with this. when this deal is done, china will say they've won, president trump will tweet at that this is the greatest deal done with china. how are we to assess that and figure out this deal or not. a lot of this is left out. how do we have any form of measurement? >> the president promised a trade deal that would be big and robust and going after this as a

purchases deal >> you don't even know if they are going to do the purchases. >> they don't have a legal text right now. the problem is is that you have a deal right now, if president trump is being assailed as having given up too easy and 2020 comes in. and the candidate is trying to be stronger on china, we may not see a phase one deal stick this could be pulled back to the 2020 election. the idea that the punt will happen the idea that we have a detant before the election. >> meaning the tariffs would come back? >> a lot of people in trump's year that don't want to deal >> the election and how this kind of deal would be used or not within the political process in the united states >> exactly

this is not a deal that appeared out of nowhere this is the same basic deal on the table for months the u.s. didn't like it. they were not even of one mind. >> is the smarter political play to say, we are not going to impose new deals but we are not rolling back the old ones. >> the part of the slow down that comes here. >> if he rolls off the tariffs and they drop the purchases and don't follow through. >> then they go right back on. >> and impact the market and economy. >> all the people that have been belly aching about how the tariffs are causing no capital spending >> the uncertainty of the trade picture is what is causing the lack of cap x spending that's not going away. >> i read something that said the market hates uncertainty

this removes some uncertainty. december 15, we are not going up we are pulling back some other ones >> the chinese have something that they are holding over you if they don't go ahead with the purchases, you put the tariffs back on. >> the question is is it even a good deal. we had kevin brady on yesterday sayings it going to be great we have all these issues taking that up. >> they may have the low-hanging fruit there putting everybody through 18 months or more of this >> there is never going it be a phase one. the question is if there will be a phase two. >> there will be no phase two, the big question is in six months, will there be a phase one? >> good to see you

i imagine we may be talking to you on monday as well. >> when we come back, the other big breaks news story overnight, boris johnson's victory in the uk we'll tell you what it means for brexit and how investors are reacting to this >> announcer: today's big number $266 million that's how much taylor swift's reputation stadium tour okto in last year, making it the highest u.s. grossing tour in history. [ electrical buzzing ]

[ dramatic music ]

ahhhh! -ahhhh! elliott. you came back! welcome back some breaks news overseas. boris johnson securing victory at a victory celebration, johnson vowed to leave the eu by january 31st saying no ifs, no buts, no maybes. the prime minister is expected to give a speech later this morning. we'll monitor that and bring you updates as they happen >> biggest win since 1987.

>> since margaret thatcher more than 70 mps >> it is not happening in a vacuum either. you just look at the map in the uk, there is london and it is the reverse there. the labor was red then all the out lying areas were blue. reading something saying if they felt the corbyn win was inevitable and that the people in the country now need to rethink the inevitable it is very bad for them.

the sanders, warren party needs to see >> brexit happened and brexit vote right into the election >> ftse is up. pound is up. >> also like when president trump was going to be elected, the world was going to end the brexit, the same thing >> the bigger thing is what happens to the uk. scotland had an overwhelming divisive vote saying they would like to see a vote for sustain session. similar for the northern ireland. >> brexit is happening the question is about the united kingdom after that >> trump and bojo, both with the hair signing the by lateral trade deal that will happen i saw people saying, except for what is happening this morning at 10:00 a.m., friday the 13th,

trump has had a crazy week the usmca. the china trade deal >> the impeachment hearings. >> people would argue those have been good. look, he won brexit, got boris johnson, usmca, china, everything for the defense bill, the budget >> let's call a spade a spade. he has not gotten china. >> it is a delay of the december 15th trade talk. it's something he said he did. >> it is something he still has to do. you make up this propaganda. >> okay. is that propaganda when every newspaper has it it is been a good week, face it. u.s. agrees to limited china trade deal

it got done. >> boris johnson winning you think is a trump win >> i think it is he was backing boris johnson saying he hopes he wins. it is not happening in a vacuum. it is a defeat for globalists and ee littists. if you thought they could lose best out of three, it is not going to happen. the china deal, we still have to wait with what happens this week if beijing tries to return again, i'm not sure trump will go along with it >> if you are worried about sunday, what is the 15th worried about sunday good week. an ipo success story her company has thrived where others struggle. that is next

turning on 54 or something still ahead on the big trade news, the potential phase one deal with china. u.s. equity futures up to 111 points "squawk box" will be right back. ♪ ♪

for every family going home for the holidays, there are countless people working to help them get there. thank you to everyone we rely on to get us home to the ones we love. ♪ ♪ yes i'm stuck in the middle with you, ♪ no one likes to feel stuck, boxed in, or held back. especially by something like your cloud. it's a problem. but the ibm cloud is different. it's open and flexible enough to manage all your apps and data securely, anywhere, across all your clouds. so it can help take on anything from rebooking flights on the fly, to restocking shelves on demand, without getting in your way. ♪ ♪

>> as we wind down 2019, we are talking stock of some of the big unicorn debuts this year some companies struggle. smile direct is down 55% others have thrived. biotech has been a bright spot one of the brighter is turning point therapeutics up 200%. if you do the math, that means it has tripped joining us now, dr. athena, ceo of turning point therapeutics. $18 raised $160 some million with market cap of $500 million. now almost $2 billion.

a successful year for you. >> good morning to you it is our pleasure to be here. >> yes so better than -- i'm just wondering, when the ipo priced, since then, have there been clinical validations of some of the drugs or is it just market sentiment? >> absolutely, you acknowledged there were many ipos done this year including biotech that have not succeeded. we were very mindful something you talk about all the time in terms of that last round of financing that brought a good deal we were very much focused on asset market performance we initially started with one clinical asset we've progressed to three. this is all based on our

platform of inhibitors of cancer >> it is precision oncology. you are looking at the precision there. what does that refer to, the reaction of inhibitors you are developing or are you focusing on very specific cancers they may not be rare or does it apply to a much larger patient population than just some rare cancers. >> our platform is focused on noncancers when you think about precision medicine, it is targeting some population of lung cancer, colon and other cancers. or al drugs that have been well

reaccept tiff. >> you said nonsmall cell cancers. > >> that's correct. >> do we know the genetic profile of people who respond? >> we do one of the ways our story different ated that story tackled resistance. as a patient has been treated, that therapy has failed them and they are looking for another option our or al drug has been changed to profiling of tumors which is now the standing practice. >> so the tumor mu tates around the initial treatment and you use something different after

that maybe it should have gone alongside it after it mutated around it? >> that's a very good point. one of the things is our lead asset. our ipo had clinical data. many ipos have strong science but they don't have clinical validation we had that. our lead is a best in class asset that could be used first it should not be held for a patient already has the therapy failing them >> you've got comments and opinions on whether we should cap the drug prices and which drug plan, whether pelosi and others we don't want to hurt innovation there is a big potential in a lot of these companies and the drugs they are developing. >> first off, i was happy to see the new fda commissioner is an

oncologist we do not have commercial drugs yet. it is a space we are monitoring. some would say it would stief innovation if the current bill goes through my perspective is bigger than that i read an article that under 10 million americans, if you diagnosed with cancer over the age of 50, the likelihood of you disoffing your life savings within two years of your diagnosis is over 40%. that is a terrible stat tisic. >> not just that, it is rare diseases too you need to find ways to push funding to get into these otherwise you are not going to find any sort of care. >> you get better and better at these but it is not cheap.

if everybody lives to 95, and i hope we do actually 95. 105 would be better tofor me thank you, doctor. >> thank you for having us this morning. coming up, when we return, uk prime minister boris johnson set to speak later after his party's victory. we'll tell you what to expect. plus a key impeachment vote delay. we'll talk about possible outcomes of how the markets could react. we'll look at yesterday's s&p 500 winners and losers >> that was wonderful. that was great it was pretty good >> parts weren't really good >> could have been better. >> parts i didn't like >> it was bad. >> terrible. >> boo through the at&t network, edge-to-edge intelligence gives you the power to see every corner of your growing business.

from finding out what's selling best... to managing your fleet... to collaborating remotely with your teams. giving you a nice big edge over your competition. that's the power of edge-to-edge intelligence.

>> good morning. welcome back to "squawk box. two big breaking stories sources tell cnbc trump has reached a phase one deal with china in principal reports say the deal would roll back existing tariff rates and cancel new tariffs set to take place on sunday. in exchange, china will reportedly boost purchases of u.s. farm goods and obtain other concessions. we are still waiting on the chinese side of all of this. as reported earlier, there has been no word from them yet second, the other big story, the uk prime minister boris johnson securing a major victory his party taking control of the parliament johnson vowing to leave the eu by january 31st saying no ifs,

no buts, no maybes the dow up about 108 points, nasdaq looking to open about 33 points higher and the s&p 500 up higher as well >> that footage you saw was live walking into 10 downing street when we return, markets seem to have paid little attention to news of impeachment inquiry since announced back in september. there are a few potential outcomes that could impact your money. servicenow put our workflows in the cloud.

this changes everything. you're right sir... everything. no not everything, i mean you're still blatantly sucking up to me gary. brilliantly observed, sir.

always three steps ahead. six steps ahead. sixteen. so many steps. you done? a million steps ahead. servicenow. works for you. 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.

the house judiciary committee is set to vote on impeachment articles today that vote was set to happen late last night after nadler ended that debate and postponed until this morning the vote angered republican members claiming it disrupted travel schedules if the committee votes to improve articles of impeachment, they will glo food for a full v. that could go early next week, the senate could hold a trial in early 2020 to decide whether president trump could be removed from office.

so far, with the outcome up 65% on the heels of trade and impeachment news going to our guest, a cnbc contributor and sara who is head of u.s. public policy and strategy jim, what do you think, what is the cost of impeachment? has there been one yet >> you mention the market is brushing this off. it is because they think they know the outcome that the president will be impeached but this will get sufficient owe indicated in the senate mitch mcconnell said that last night, we all know there is no chance this president is going to be removed from office. i thought there might be a one in five chance now i think there is about a one in 500 chance. he might not get any votes to convict him in the senate. >> ifs that t that's the case, t

happens? does this slow things down next year as an angry president comes back and says, wait a minute, there is a price to pay for this what happens >> what is interesting is that ironically in this flurry in dez, it has led to more legislation. i think what you are seeing is house democrats and pelosi in particular feeling pressure to show voters that she can make progress on issues they care about at the same time of impeachment. so actually she's passed legislation in the house this week on prescription drug pricing, on nafta 2.0 and it looks like they'll get a budget deal ironically, so far -- the democrats are trying to prove that they can litigate and legislate at the same time the stuff she passed is something the president wanted in terms of drug pricing or

other issues, you think there is any chance any of this works its way to law >> that is a good point. you are right to say we are going into an election year more importantly than anything else in terms of next year. we'll see a lot of the praez trying to frame the election in the economic conditions which he'll take credit for. i don't think we were on track for a lot of legislation >> pence can't vote on anything here there was some that mcconnell might go for an acquittal. he could only lose two did you see that instead of trying to get the 67. what does he need, a 51 to get an outright proclamation if he lost romney or anybody, you can't have pence come in to

break the tie. >> listen, i think the goal is to run the board here and to maybe get somebody like romney to -- maybe he doesn't vote at all. what markets ultimately care about -- >> do you know about the acquittal angel? >> no, i have not heard people talk about it, no. >> yesterday, i heard pelosi say we don't whip votes on something like this. >> there are republican senators at risk of losing. they do not want to lose those republican senators like cory gardener you need to know. >> it will be complicated for sure for some republicans. if he can show an acquittal, that is a great victory for mcconnell and the president. >> i wonder how many dems we'll get next week. could be two could be six >> i think the democrats and the

republicans some the senate, we are not going to have a great feel until we come to next year to see how this trial plays out. i think mcconnell is floating the idea we are not into the senate yet i think we'll have a week-long trial. justice roberts isn't going to preside over kind of nothing he's going to make this look like a real procedure. it is going to be quick and it is everybody's interest -- this is already like we know how the outcome is going to look we might as well get through it and move on. d u e stda i diyoseyeery,t took two hours to vote down the amendment that would change the name from joe biden -- >> we've got to go each day our planet awakens with signs of opportunity.

but with opportunity comes risk. and to manage this risk, the world turns to cme group. we help farmers lock in future prices, banks manage interest rate changes and airlines hedge fuel costs. all so they can manage their risks and move forward. it's simply a matter of following the signs. they all lead here. cme group - how the world advances.

welcome back to "squawk box. more problems for facebook they're integrating what's app and instagram. they may seek a preliminary injunction against facebook as soon as next month at issue, the integration with the messaging services could violate antitrust laws and perhaps even more, make it very difficult or even more difficult to try to break up later for more on this developing story, want to bring in one of the street's top tech voices, mark maheney what do you make of this report? >> this regulatory heat has been building for a while on facebook the company and zuckerberg announced he wanted to make his services intraoperable, instagram, what's app, facebook, facebook messenger

the real loss for facebook is monetizing what's app. that's the potential loss for facebook it's a negative development. >> the larger issue is is this going to set up the breakup or forced even voluntary breakup of these companies or of this company in terms of saying, okay, you can't do this and then does it take away some of the rags nationale to have these component parts as one institution? >> i wouldn't take away the rationale, but it would certainly make it harder to bring them together. we and the street, i think, believe that the chance of a breakup is very slim the chance that facebook would actually be required to unwind acquisitions that it already got approval of 7 and 5 years ago, i think that's a very slim

probability -- slim possibility. that's why it would be a negative surprise for the street if it were to pass something like that, however, would take years to work its way through the system. >> no, no, the reason i'm asking you the question is not necessarily -- i use the word voluntary. once you get to a position -- if you got to a position where the ftc said, no, you can't integrate these products, mark zuckerberg would say, there's more value to be had in having these as independent entities, not under one umbrella >> i don't think so. i get the point, andrew. i don't think they would voluntarily look to spin these assets off there's a fair amount of synergies created to date. at least between facebook and instagram and what's app unwinding those synergies, i think facebook itself would view as a negative development. they wouldn't voluntarily do it. you'd have to force them. >> extrapolate out quick before we go, what does this mean to the other tech companies what does this say about how

aggressive you think the ftc might be in going after them >> there are four or five names in tech that are under the regulatory spotlight, facebook, amazon, google, apple, microsoft. if the ftc is willing to do this with facebook with assets that have already been approved and purchased, it probably would put a lot of pressure on these companies to not do any major acquisitions going forwards. >> apple is vulnerable i imagine if you look at something like this. >> no. no andrew, step back. i think it would be the ability of these companies to do large scale acquisitions going forward. anything they would consider in the future they'd have to think about the whisk of that being unwound several years down the road it would be a chilling impact on future m&a. >> small deals as well >> small deals like google for f fitbit gets through. anything sizeable, 10 billion or

above. >> thank you for waking up early. appreciate it. >> thank you, andrew. >> nice to see you happy holidays. >> you, too. futures pointing to a record high another one for the dow. we'll get you up to speed on two big stie u. econors,.kelti and phase one deal that's next. ompany's growth. i try to find companies that turn these challenges into opportunities. but by going out in the field, and meeting management, suppliers, competitors. in the end, it's these unique companies with creative business models that will generate value for our investors. that's why i go beyond the numbers.

apple card. is a new kind of credit card, created by apple, so it's simple and transparent with a new level of privacy and security. it lives here and here- on your iphone,

and it will save you 6% on holiday gifts at apple; like iphone, apple watch, airpods pro and so much more. ♪ apply in as little as a minute, right in the wallet app.

wall street with ire once again. u.k. prime minister boris johnson landing an historic general election victory in the u.k. as he now turns his attention to making brexit a reality. and no vote. >> the committee will now stand in recess until tomorrow morning at 10 a.m. in a surprise move late last night, house democrats move to delay an impeachment vote until this morning the latest from washington is straight ahead as the second hour of "squawk box" begins right now. good morning welcome back to "squawk box"

right here on cnbc i'm andrew ross sorkin along with becky quick and joe kernen. y u.s. exwitt at this futures. dau up 95 points higher, s&p up 9 points and nasdaq up 32 points higher so far the markets taking it in stride, taking it quite well. >> sources close to the trade talks telling cnbc that the u.s. and china are reaching a phase one trade deal in principle. that's pending the president's approval that news pushing markets to record highs kayla tausche joins us right now. she has more on that front good morning, kayla. >> reporter: good morning, becky. since the u.s. economic team met to discuss the agreement reached with negotiators, it has been radio silent about what that deal would entail. despite expectations for a statement from the white house and u.s. trade representative and a potential signing for the chinese ambassador for the u.s.

before the end of the week china's foreign ministry today would only say any agreement has to be mutually beneficial. the global times editor in china notes the quiet and says this is a delicate situation there are questions now about what transpired overnight and whether china refused any terms that had changed a source close to talks said yesterday that president trump was pushing for a higher number on agricultural purchases but was ultimately expected to sign off on a deal. all this as tariffs are set to take place sunday from the u.s. and china. no federal register noticed to delay the tariffs, becky, as of yet despite the markets and negotiator's expectations. >> kayla, what do you think? anything could happen over the next few days or do you think this is set down this path >> i think it really depends on what happens with the chinese negotiators. it appears, becky, that the ball is in their court at this point. that meeting lasted for about an hour yesterday the president also met with a handful of major multi-national

ceos and the expectation from everyone who had a readout of both of those meetings is that the president was on board the question is just what happened when that news was delivered to china and what they are trying to extract from the u.s. and whether, in fact, that is the reason why we're sort of in this limbo period right now. >> kayla, thank you. we'll talk to you soon. joining us now to discuss the news on trade, daniel rosen and matt through slaughter he's with the tuck school of business at dartmouth. i don't know what other issues means. do you think there are other issues or is it just an ag deal at this point? >> in 1999 we negotiated the wto access package with china. it was dozens of pages of detailed work that had been accomplished on stuff inside china, deeply structural stuff it wasn't just a handful of ag commodity products. >> this is the incredible

shrinking deal. >> did it help all the details and then none of them were adhered to. >> the problem wasn't china's wto participation, it was whether we took it seriously you don't do one deal and go away to the beach for two decades and think it's going to continue to be good. >> should we have re-entered this fray? >> the way that it's been done the past three years >> yeah. >> evidently not given where president trump set the bar where he would for sure deliver or no deal at all, we are so far away from that. >> you don't even know if it's a phase 1? >> what does phase 1 mean? after the elections now we're told so earlier on it was unmistakably said if we don't get all the big stuff up front, we're not doing this we're not going to go down this path. >> can we still come back after phase 1 if it really is side lined? let's return to these intractable issues and make any

headway at that point? >> we could, but those big issues remain completely unresolved based on all the news reports of today the coercion, intellectual property, subsidies to state-owned enterprises. they've been building since china's accession into the wto that would have to wait until the phase 2 or phase 3 agreement. >> do you think that we will abandon phase 2 and phase 3 or do you think that we're actually going to try to keep plugging away on this i figure lighthizer and navarro want to keep plugging away, right? >> i think they will as important as agriculture and manufacturing are to the u.s. economy, when you look at the whole u.s., there are only one in ten jobs in america importantly trade and services is a huge part of the u.s. economy. it's one where we have a large comparative advantage. so it's things like educational services, tourism services people coming to the united states to study from our great professors at universities,

coming to visit our landmarks, going to visit sporting events to see the tiger woods and the john daly's and the other such@leads those are the future issues and policies in the 21st century that need to be addressed. >> dan, you're not a market strategist obviously so yesterday the news comes out that something's going to be announced, then agreed upon. so it goes from up 50 to up 220 or whatever it is. then further news comes out documenting that it's only ag buys and that we're rolling back the tariffs and we're up another 100 points or so today >> yeah. >> do you think the markets are just looking for some type of removal of uncertainty about the tariffs or they're wrong or they're -- i mean, they're not over sold since we're at new highs again. are they misinterpreting the -- nothing's been accomplished here >> when it comes to china, investors generally pretty reasonable minded people are

willing to believe that policy leaders, if they want, can just make these things happen sort of without regard to what the economic fundamentals and the value and the underlying stuff is we've seen that for the past three weeks in china debt markets where the big story, really, is that on shore and off shore chinese firms are defaulting on their debt and yet a little bit of sunshine in the property sector, which is the most bubbly in trouble industry in the whole of china has led to a bit of a global rally thinking that somehow chinese construction is coming back with a roar and that liquidity is going to be able to carry that over the edge here it's emblematic of how much people are willing to expand their toolbox to look for another deal. >> when i see what navarro says under a non-leplume and when i see what lietz lighthizer and se

bannon who probably still has a presence, there are people who want to do much more draconian negotiations. >> i was going to say. we talk about phase 2 of the trade deal >> yeah. >> the trade war of the cold war. >> what's inside the boundaries of trade is ever shrinking it's an ever shrinking impossible burger. >> you mean keeping out human rights, keeping out security issues >> no. >> i.p. >> this is dealing with ag >> right. >> all the industries that really matter to the future of the country, high technology, all of that is being dealt with in america it's being dealt with with export control regulations, inward investment. the fbi restrictions the entities list in telecommunications. >> oh. >> yeah. all these really important industries. >> they don't want any of those things but we are having all of those. >> soybeans is not going to employ our kids. >> matthew, do you think that if

we return to this, whenever, after the election, next year, whenever and you have guys like navarro that are still very hawkish about how we should deal with china, bannon, cramer, it's cool we throw him in with navarro, bannon mentioned him yesterday, do you think we return to a really hard-lined stance for phase 2 is this administration going to want to return to threatening more tariffs to get what it wants on these other issues? >> it depends on if there's enough voices in the administration that recognize that there's really an overlap of interest between the united states and the chinese officials here china's economic growth has been slowing in recent years for good reason population growth and labor force growth has slowed to near zero so what's going to drive growth into china becoming more of the future, it's going to have to be innovation and

technological change there's been over investment and that's part of the trade frictions that have been generated. like a lot of western and bases want there to be, more protection for high tech services and manufacturing, the same thing is true to build the good jobs that chinese leaders are trying to do in their economy as well. >> right. >> what's going to be needed is voices that recognize there's got to be some way to find a commonality of interests and changing the laws and policies around protection of ideas that's going to take some time >> i mean, i think about the next five years and i think about the plan that china put forward. didn't realize that maybe the rest of the world was going to have a problem with some of it you look at the south china sea, the islands, what's happening in hong kong and, i mean, i wonder what -- the next five years are going to be unbelievably important for the next hundred years. >> i was in brussels last week i started this week in

amsterdam. this is not just an america/china issue. everywhere in the market world folks are concerned about where china's choices are taking it right now. i've been pretty much bullish and enthusiastic about china's entry into the world economy but that's because they were generally doing it on adjusting over to market mechanisms and principles they've lost the trail on that the past couple of years when they've hit the hard rounds of what it means to marketize and liberalize if they don't get back on that trail -- >> you're not even talking about human rights you're not talking about hong kong how the hell are they going to deal with that >> it makes market companies think twice about whether they want to -- >> what do you think they really want >> they want to be left alone and the status quo. >> no, do they want to take over the world by 2025. >> they would gladly trade that off if they could have stability. this is what they want, they want everything to stay the way it is. >> not an evil empire. not the soviet union.

>> maintaining power >> do they want to further their worldly ambitions? >> only to the extent -- only to the extent they think they need that in order to secure china's interests. if they are in the middle east, just as we did, worried -- >> they could see a co-existence with another super power, they don't want to be the only super power. >> they've never been out there. in all of china's storied 5,000 years of history, they've never been deployed globally. >> would have been hard 5,000 years ago to do that. >> ask alexander the great to do that. >> took him a while. >> in a single lifetime. >> going back to sailing dan, thank you matthew, thanks for joining us i'm scared >> my pleasure. >> worried >> about what? >> america's place in the world. you? >> you should have been scared about that a long time ago. >> we've been losing for a while. i know you think that. >> you might want to be

scared -- i don't know what you want to be scared about. u.k. prime minister boris johnson securing a victory overnight. johnson vowing to leave the e.u. by january 31st saying no ifs, no buts, no maybes the results were more decisive checking the pound at this hour. >> taking things in stride >> it's doing better than that up about close to 2% actually on this news right now. 1.34 right now take a look at european markets, they are up across the board ftse 100 up close to 2% as well. we've got a lot more coming up on "squawk box" this morning. lawmakers battling over drug pricing. our good friend and former fda commissioner dr. scott gottleib is going to join us after the breaks to determine why price controls may stifle the market i want to check on the markets

here in the united states. dow looks like it would op uenp 102 points higher. "squawk" returns right after this that's what happens in golf nothiand in life.ily. i'm very fortunate i can lean on people, and that for me is what teamwork is all about. you can't do everything yourself. you need someone to guide you and help you make those tough decisions, that's morgan stanley. they're industry leaders, but the most important thing is they want to do it the right way. i'm really excited to be part of the morgan stanley team.

i'm justin rose. we are morgan stanley.

welcome back, everybody. the house passing speaker pel i pelosi's drug pricing bill the senate is not expected to take any action on the measure it currently has a competing bill and president trump said he

would veto it. in a wall street journal op ed scott gottleib tackles the drug pricing debate taking place on capitol hill. he said policy makers need to resist the urge of controlling drug pricing dr. gottleib joins us now. he's a venture capitalist at new enterprise associates. he's a cnbc contributor and you're on the board of pfizer, correct? >> correct. >> pfizer the drug company scott, this is always a difficult conversation because when people look at this, it's very obvious we had a dwguest on earlier thi morning, patients who are found to have cancer 40% of them or something have financial troubles within the first two years of that diagnosis. this is a hot button topic it sounds at first blush anybody who says you don't want higher drug prices like you are being mean and cruel to these people who need the drugs you have an important point. >> this patient's facing real hardships. more people find themselves

under insured for drugs. it's not increasing that much. what's happening is more and more patients are out of pocket for their drug spend and it's tied to a list price the problem is that the government steps in and sets arbitrary price controls, which is really what this house bill does, the government starts to pick winners and losers and re-allocates capital it's not going to re-allocate the capital into the highest use endeavors. my fear is what this bill is going to do by raising the cost of capital and capping effective returns is effectively reduce risk taking. you'll get new drugs but you'll get investments in known targets and platforms well developed the problem is what holds promise for the future won't get developed. >> those that have plenty of drugs would be what? >> cardiovascular disease.

parts of the body, organ systems that we understand the biology well those are targets that are well-validated places in the body that we don't understand are brain diseases, neurodegenerative diseases and cancer >> over the last 15 years? >> right 15 years ago the refrain about the drug industry was all they do is make two products. all they do is make a statin or a blood pressure pill. we designed medicare part d and tried to shift incentives into higher risk incentives you see companies shed their otc businesses, animal health, generic drug businesses and they moved all of their investment or a lot into the high growth, high risk parts of the industry. >> as a result, what sort of developments have we seen for these rare diseases where there was no hope before >> gene editing, gene therapy where we had the ability to cure

inherited disorders. sickle cell diseases, we'll have a cure for sickle cell disease in the next five years these new platforms are being used against rare diseases once they get perfected and mainstreamed, we'll use them against more common diseases like maybe to cure the effects of a heart attack. you look back 250 years ago, those drugs were targeted towards rare cancers now we have antibody based drugs for treatments like asthma or common diseases like that. more cholesterol, lowering cholesterol. they get perfected in high-risk areas and then they get mainstreamed you won't get investment in that you'll get known platforms, is small molecule drugs, what you swallow and well validated targets. we'll get more drugs, maybe more, but we won't get drugs targeted to high risk endeavors. >> where does it stand with this bill passing the house the president has said he'll veto it. there's an alternative bill

moving its way through the senate where do you think that will play out >> the alternative is a good piece of legislation there are parts that could be modified and made better that doesn't solve the drug pricing problem, if you will, the out of pocket problem for a lot of americans it will solve it for senior citizens it modernizes medicare part d. the house bill doesn't help a lot of consumers either. it's not going to solve people's problems every day >> what will solve the problems on an everyday basis if insurance companies are no longer paying for these things and people are dealing with list prices that aren't the prices insurance companies pay, how do you fix that >> there is a provision in the bill that passed the senate just recently or is a compromise that is said to be broken between the senate and house that would mandate that the rebates need to be passed on to consumers. that would be helpful. i think looking at the structure

of health insurance, we've started to hollow out health insurance in recent years. a lot of this was set in force more people find themselves in certain formularies. they find themselves under insured for drugs. it's not that the drug prices have gone up significantly. >> they stop paying for it. >> insurance companies -- >> as a result of the affordable care act >> the affordable care actwas compromise trying to extend coverage to people with coverage that was skinnier. so i think the aca popularized the use of closed formularies. that means there's a formulary list it's a narrow list of drugs that are covered but drugs that don't make that list you're completely uncovered for. >> which goes back to rarer diseases and other issues that are popular. if you are not using lipitor, it's not on the list. >> lipitor there's a lot of generics for a lot of these common

maladies there is something. >> personalized medicine will be expensive. >> it is. >> we better not hurt the drug industry too much. it's better than going into a hospital. >> gene therapy drug, a single patient in a clinical trial for gene therapy, costs between 500 to 700,000 just to run the trial. >> that's cheaper -- >> gene editing trials, it's $1 million. >> you are finding platforms that can be rolled out to multiple patients and you find multiple diseases. >> exactly. >> you're talking about one that goes to a platform. >> if you want to grandstand it in congress, you're going to use 500 to 700,000 -- >> that's not what it costs the patient -- >> i know. >> but the alternative is you don't solve these problems. >> i understand. talk to the people that want to stifle innovation. >> the other thing is the refrain is, well, all we're doing is curing rare diseases.

that's not having a big public impact the platforms as they get perfected will work. >> things like autism, alzheimer's. >> parkinsons. looking at gene therapy to reconstitute heart muscle after a heart attack. >> do we need to keep saying a pill is better than a hospital bed? >> the technology costs are born up front it's hard to lay out the money. >> got to go. >> scott, come back because i love this conversation. >> u.k. prime minister boris johnson securing a major victory overnight. we're going to head to london for the latest futures this morning are striding higher. up about 86 points we'll be right back. time now for today's aflac trivia question. tomorrow marks the birth of quantum theory in 1900 which physicist created the

theory x"onnusqwk when cnbc's "ua bo cties lac? because health insurance doesn't always pay it all. aflac! after surgery we had extra bills followed up visits, deductibles. we thought health insurance had us covered up for everything, but it didn't. aflac gives you money directly to help you with those things. i want to thank my wife, my mom, the duck. get help with expenses health insurance doesn't cover. get to know us at aflac.com

but with opportunity comes risk. and to manage this risk, the world turns to cme group. we help farmers lock in future prices, banks manage interest rate changes and airlines hedge fuel costs. all so they can manage their risks and move forward. it's simply a matter of following the signs. they all lead here. cme group - how the world advances. now the answer to today's aflac trivia question. tomorrow marks the birth of

quantum theory in 1900 which physicist created the theory the answer, max planck what if numbers tell only half the story? at t. rowe price, hundreds of our experts go beyond the numbers to examine investment opportunities firsthand.

like a biotech firm that engineers a patient's own cells to fight cancer. this is strategic investing. because your investments deserve the full story. t. rowe price. invest with confidence. 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.

breaking news overseas u.k. prime minister boris johnson securing a major victory. at a victory celebration johnson vowed to leave the eu by january 1st. no ifs, no buts, no maybes willem marks joins us. corbyn says he's going to quit promises, promises >> promises, promises. what we've learned from jeremy corbin in the course of tonight is that he will not lead the labor party into the next election the worst result for the labor party since the 1930s. for the conservative party the best result for them in decades. it means that boris johnson will stay inside number 10 downing street likely for the next five

years. he has a significant parliamentary majority when it comes to brexit that will allow him to leave january 31st, next year. the challenge then of course is how does he -- >> okay. we're taking -- we're having some technical issues, we would call them. call it taking its in tv business a record-breaking day on wall street and this news out of china and this news out of the u.k. that we were so -- well, we were interrupted jeffrey mcdonald is here harng smi hank smith is here as well >> good morning. >> how do you read the issue in brexit, the issue in china and to the extend you think it's going to matter, to the markets. everybody is liking things if not more so? >> i think the uncertainty meter

just took a really big hit everything in my world keeping curbs glass, yields down, we had the fed on it. they're unlikely to do anything next year. ecb, the transition to lagarde very smooth. going to be a smooth transition there. i think with brexit, i think with the usmca, all of these uncertainties we've been dealing with in the market have all made big moves in the last week i think it's doing what it's supposed to do, which is encouraging risk assets, steepening curves, rates >> this market has been acting in the most rational way in my 35 year career when you think of what it's been 3 paying attention to. low inflation, low interest rates. gdp growth strong balance sheets, it's ignoring all of the headlines that are often framed in a crisis draconian matter, whether it's brexit, whether it's income inequality, climate change, government debt, geopolitical tensions it's ignoring all of that and

just focusing on what really matters. that's going to continue into 2020 in our opinion. >> so the question though is should it? i mean, you're arguing the answer is yes. as in all of these issues are noise and my question is do they ever become more than that >> well, the noise has become -- is going to become deafening in 2020 because we're in an election and regardless of party affiliation, whose ever's out of office is going to create a crisis environment that only their solutions can solve. notice how in the democratic campaign so far there has not been the topic, the economy. the moderators never said, now let's turn to the economy because the economy is in great shape and the consumer is in extraordinary shape given that we're in the 11th year of an economic extraction. >> when we have the tax reform act that came in 2017, that was very favorable for corporations. should have everybody couraged a lot of investment. you didn't see that business

investment it was against the backdrop of all of this uncertainty. if that goes away, i think the investment picture becomes more. >> i know you're playing for the long term as they like to say but we are in this very strange end of the year period where there's lots of tax harvesting and all sorts of she than know begans, names, they show up. we've had this sort of nice run, sort of christmas rally of so s sorts. the question i would ask you, do you have any anxiety come january 1st we could have a little bit of lull or worse? >> our only anxiety is the market has to have anticipated or bought into a little bit of next year's returns. while we see a very favorable fundamental backdrop particularly different the trade deals completed, confidence will pick up. the economy should pick up off of 2%.

that's got to be a little bit priced in. we're counseling moderate, temper returns we still think it will beat. >> if you get this environment where curves are likely steepend, lats likely to back up, you could begin to lock in some of the other rates. the other thing i would throw in there in terms of year end issues was the funding issue with the fed and the repo markets being haywire. around year end we're likely to see more noise around that in the fixed income world that's something we're going to watch >> they said something about that these aren't weird moves. >> he did and he also really went out of his way to say this isn't qe4. these are funding issues. >> they say that but if you need to provide the liquidity, you're not doing it for that intention, for the intention of trying to losen things up. if you are providing the liquidity, you are still providing something. >> what's interesting, they're

talking to the banking industry all the time they checked in around september and said, hey, do you have enough ample liquidity, we have more than enough. >> here we are. >> here we are, so there is some reluctance to put that cash back into the funding markets there's something about the attitude of these company managements with respect to the regulatory environment that is gumming up the works in the funding markets. i think we're going to be dealing with that as we move into 2020 but it will certainly be something we're paying attention to going into year end. >> from an equity standpoint, they said they're going to be on the sidelines for 2020 that has to be a positive backdrop. >> thanks for having us. when we come back, an update on when the 737 max may be back in the skies phil lebeau joins us right after this break right now though as we head to the break, let's take a look at yesterday's winners and losers in the stock market. ♪

(vo) in every trip, there's room for more than just the business you came for. ♪ let's make the most of ♪ ♪ what we've been given whether that's getting a taste of where you are... ♪ let's get to living ♪ ...or bringing some of that flavor back home. that's room for possibility. ♪ ♪ let's get to living (brakes screeching) okay. so, today you're going to leave your phone with a guy named flip. (ding)

but it's more than your phone, it's your business, your customer data, your sales figures. and who can forget, those happy hour selfies? not flip. (honking, gasping) this isn't working. introducing samsung business security solutions, with knox software. with the galaxy note10, you can remotely wipe data or lock phones, so your business is secure even when your phone isn't. samsung business solutions. even when your phone isn't. of millions of americans during the recession. so, my wife kat and i took action. we started a non-profit community bank with a simple theory - give people a fair deal and real economic power. invest in the community, in businesses owned by women and people of color, in affordable housing. the difference between words and actions matters.

that's a lesson politicians in washington could use right now. i'm tom steyer, and i approve this message.

welcome back a bad day of news for boeing yesterday after announcing an agreement with southwest american airlines took the 737 max off of its schedule until april. phil lebo joins us with all of this you brought it from the faa administrator's mouth. but we continue to hear of a time line that operates on the faa's mouth and not boeing's. >> that was the come to jesus meeting. this was not going to be a case where boeing could continue to pressure the faa as they were november and early december. at some point you knew that the faa would say to them, we control the time line. that's what happened yesterday when dennis muilenburg met with steve dickson. they fell in line with the 23fa

time line. is a q1 certification in line? maybe. this depends on a number of hurdles to be cleared. the faa is not saying they expect this to happen by any certain date meanwhile, we did have the news late in the day that american airlines has pulled the max off its schedule until april 7th look at that number at the bottom, almost 50,000 flights will have been canceled by american, 737 max flights will have been canceled through april 7th when they plan to bring it back in. southwest pilots yet out with a note saying, you know what, we don't think it's going to be back in service until april. officially southwest has not moved it off the schedule. they still have it in early march but don't being surprised if that gets pushed back as well take a look at shares of southwest. as we reported yesterday, the company reached a settlement with boeing, $125 million, roughly speaking around there, will go to a special profit sharing payment that will go out

to southwest employees if you take a look at shares of the -- of boeing, remember that the max still faces a number of hurdles, guys. even though we have these expectations being drawn back to maybe late january, maybe february certification, there's no certainty there >> all right phil lebeau, thanks. >> you bet. >> been an interesting -- you've done a lot for us in the last couple of days we'll see what happens the stock didn't do quite -- it doesn't know which way to go on all of this news i guess maybe it's looking for a bottom coming up, what will mike bloomberg's tax plan look like robert frank joins us with a preview. hello. >> good morning, joe the richest man ever to run for president is likely to raise the taxes on the wealthy anorl tell you what it could me f your taxes and your investments coming up. here, it all starts with a simple...

hello! hi! how can i help? a data plan for everyone. everyone? everyone. let's send to everyone! wifi up there? uhh. sure, why not? how'd he get out?! a camera might figure it out. that was easy! glad i could help. at xfinity, we're here to make life simple. easy. awesome. so come ask, shop, discover at your local xfinity store today.

welcome back to "squawk box. mike bloomberg has yet to unveil a tax plan but our robert frank has ideas where the presidential candidate would look to raise revenue. >> only one thing is certain under mayor mike's upcoming plan, that the rich will pay more he'll make the progressive tax system even more progressive and focus on the three pillars of the tax code, that is the top income tax rate, the capital gains rate and the estate tax. the rates and details will be released in the coming months.

to help those at the bottom he plans to increase the earned tax credit and child tax credit. bloomberg told people that supporting a tax cut -- wealth tax for people like me, those proposed by bernie sanders and elizabeth warren just doesn't make sense now a year ago in new hampshire he said wealth tax may not be constitutional and that those who want to attack capitalism should, quote, take a look at venezuela. >> he's apologized for those comments no, kidding. kidding. that was stop and frisk. >> wealth tax is taxing the wealthy. >> forthcoming. >> but he's not supporting a wealth tax on the corporate tax side bloomberg was supportive of the trump tax cut on businesses but he said the accompanying tax reductions on the wealthy were a mistake. he likes to point to his success with raising taxes on the wealthy in new york city that's where he raised property

taxes in 2002, raised the top income tax rates a year later and raised sales taxes which helped turn a multi-billion dollar deficit into a surplus. >> for more on mayor bloomberg entering the 2020 race and if wall street will support his run, we're joined by alan patrikoff, friend of the former new york city mayor. are you backing mike for this? hillary looks like, i don't know can you tell us anything do you think she'll get -- >> she certainly hasn't called me and told me she's thinking about it i would be very surprised. there are lots of surprises around it. i am supporting biden. i have been since the earlier part of the year we all love mike in new york if mike had come out earlier this year, i'm sure a lot of people on wall street would have been certainly very supportive i think the question is has he

come out too late and will he -- can he quickly mobilize support. i mean, $100 million -- >> what do you make of his strategy nkts i don't think he had any choice i think it was just too late i think he's coming out -- he is going out, as i understand, with a massive field organization so he's really going to be on the ground. >> you disagree with his premise that joe biden can't win he said he wouldn't run unless joe biden couldn't win. >> that's what he said last year he said lots of other -- >> you don't take his word -- >> i have nothing negative to say about mike bloomberg we're all fans of his. >> he did say none of the 17 can beat trump. >> exactly he thinks now that something new is needed. he thinks that there's not enough energy. >> do you worry as a supporter of biden, how much do you worry about the money piece of this. is it elizabeth warren has

money, pete buttigieg has money. all of them i think have more money than biden then you have bloomberg who has more money than all of them combined. >> even without as much money, joe is leading the polls if you want to trust any poll at least as of yesterday he's at the top of the pack. he's obviously getting the most bang for the buck. i read a fund-raiser from two weeks ago, i have to tell you, it was in an apartment so if i tell you it was sold out, it was sold out there were only room for 100. >> i know you. you know hillary what if she were to enter, would you go with her? and is there -- have you talked to her about the possibility of it tell us the truth -- >> the truth is -- >> there's 17 ways to tell whether -- >> i would tell you it would be the same thing as with mike. it's late. >> oh, it is you'll stick with biden even if hillary -- >> i've been saying it

i'm going to go home with the girl i brought to the dance. i'm a loyal person. >> i don't know if you should say that anymore. >> i can't say that? >> go home with me >> okay. >> rephrase that. >> not in today's world. >> rephrase what i said. >> you might use a phone number down the road and court someone the night of the dance >> give me another phrase. i'm sticking with joe biden. that's who i started with and i do think he is -- has the best chance of winning. i mean, he's -- look at his tax proposal it's come out. it's a sensible tax proposal he's going to raise taxes by, what, $3 billion to offset his expenses. >> what do you think of how many people that are in the race and those entering late though does that frustrate you as someone who would like to see a democrat there. >> i would think it would frustrate joe. >> i'm fine -- no, oh, oh.

>> the clown car of a million is over we're really down to five. >> you do biden, buttigieg, sanders. >> warren. >> you do warren. >> and yang. >> and maybe bloomberg. >> yang is above bloomberg >> well -- >> yang and cory booker, some -- they're in it but not really in it >> they're still going to be on stage for the debate. >> i am not giving up. >> they're still going to be around for the debates there is a clutter effect. >> no, the question though is do they get into all of the debates? >> yeah. the one that's coming up those people certainly are and our friend from the west coast will be in. >> what about tom steyer. >> that's what i'm saying. it cost him a lot of money to get there.

joe is in the lead he's the best candidate based on credentials. >> do you think the party has moved -- has the party moved to some other place where the wealth tax and his tax proposal isn't grand enough >> i think the vote in england yesterday, the brexit vote with johnson winning and offsetting labor at a dramatic fashion has -- is sending a message. stay away from the far left. >> do you think voters within these parties are rational actors in that way meaning they say we really only want to support the person who we think can beat the other side so much as we want to support the person that we sort of get excited about? >> yeah. >> irrespective of their prospects. >> we had an excitement process last time with the candidate who we now have running the country. obama certainly created excitement bill clinton did i think joe is less exciting but

more fundamental, more factual and more qualified to be -- sit in that chair. >> all of the young people, so much energy. you could use the ragan line you, alan, could say, joe, you're not going to let his relative youth get in the way of supporting him >> famous ragan comment. >> famous ragan comment. >> which got a lot of laughs. >> i think bloomberg is the same age as biden. >> exactly trump, bloomberg, biden and bernie >> michael bloomberg -- look, i don't know if you can say people act younger or olders -- >> look at me. i'm the best example 85 i should run right now >> yeah. >> ran over here >> not necessarily age but acting your age or acting not your age matters >> well, look, mike and i are from new york. joe's from pennsylvania, delaware i mean, there's -- they're not as -- you know, they don't use

their hands as much. >> not in pennsylvania okay >> we should ask you while you're here, you work with david stern. >> yes. >> the great former commissioner of the nba who i know is consulting with you and doing other work, he had a brain hemorrhage a dear friend of mine. i did my first interview of my whole life in a little sports magazine i went to his home he knows it. >> he's a terrific guy he's been working with us for almost two years now after he left as commissioner i just happened to run into him at some point, some event or party and sold him on the idea of coming by every monday he's gotten really hooked with entrepreneurial companies. i think he's made an investment in 20, 25 companies. you have to hold him back. he's gotten really involved with it and i'm really very sorry this

morning. i'm really worried they called me last night to tell me he was in the hospital they were having an operation. i don't know what the results are this morning, but we should all -- >> we are praying for him and for diane and eric his son and andrew. >> gracious man. >> he's terrific i hope he's going to pull through. >> we're all hoping for that >> hopefully just an episode. >> alan, thank you for being here this morning. >> robert. >> and our thoughts do go out to david stern and his family. when we come back, sources telling cnbc that the trump administration has reached a trade 1 agreement with china pending approval from president trump. the markets are soaring. they're up 56 points we'll get much more on the marketeaion te rctafr this break. "squawk box" will be right back. this is a historic moment.

demand has never been higher for what we do. creating compelling, engaging, and informative content and experiences. with this merger, viacomcbs will be one of the largest and most influential content creators in the world. i know we can deliver on the full potential of this amazing new company. so servicenow put your i workflows imm-hm.cloud, huh? your employees must love you. thank you. ah, you could say that.

so how are things with you guys? great. thank you. thank you, sir. lunch next week? terrific. say hi to the team. will do. call my office, i will. -sounds good. alrighty. servicenow. works for you. across the atlantic -- >> we will get brexit done no ifs, no buts, no maybes.

>> u.k. prime minister boris johnson scores a win and a potential nail in the coffin for anti-brexit forces the final hour of "squawk box" begins right now. good morning and welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square. i'm joe kernen along with becky quick and andrew ross sorkin u.s. equities are a little bit higher but they have definitely moderated. in fact, we've got some red in the s&p and the nasdaq dow holding on to just marginal gains after being up triple digits for most of the early morning session. there is the last little bit of trading as you can see right

now. let's look at treasury yields. let's see if there's any movement there yields had gone up based on the china deal as they have typically recently on the idea that maybe some uncertainty is removed. 10-year, 187, about where it was earlier this morning. we are watching two very big stories this morning for the market impacts in the u.k. prime minister boris johnson's big win and the vow to get brexit done. this side of the atlantic president trump signing off. let's go to kayla tausche for the latest on trade. we have seen the futures take a sudden turn lower. i haven't seen any tweets. that's the first place i checked. what can you tell us about what you're hearing at this point >> reporter: it's still radio silent from both the u.s. and china. this since the u.s. economic team met with the president yesterday to discuss the agreement. we expected the president to sign off on the deal the question is what happened in china overnight. despite expectations for a

statement from the white house and u.s. trade representative and potential signing by the chinese ambassador before the week's end "the new york times" is reporting that a policy announcement could be here today. mike pillsbury spoke with him yesterday after that trade meeting and said he expected a breakthrough china's foreign ministry would only say, quote, any agreement has to be mutually beneficial, end quote. china is not confirming that there is any even broad agreement at this point. so we do have questions about how china reacted to any potential change in terms that were potentially presented to them overnight sources close to talks yesterday said that president trump was pushing for a higher number on agricultural purchases but is ultimately expected to sign off on what negotiators presented to him. both u.s. tariffs and china retaliation, we would need a federal register notice by about today, becky, in order to delay those tariffs. we haven't seen anything

published as of yet. >> that's an interesting note. kay kayla, thank you very much let's bring in former commerce secretary carlos gutierrez. he's the chairman of all bright stonebridge group. thank you for being with us. >> pleasure, becky thank you. >> where do you stand with where we are >> look, i think that the announcements of the last couple of days, especially coming out of the u.s., are positive. this doesn't mean that the trade war will be over, but it's a halt it's a halt in hostilities and i think what's remarkable is that we have announced that we are willing to take down tariffs, not only stop the increase on the 15th but actually take down some of the tariffs that we've already put on that's an extraordinary concession i think it's a sign of goodwill on our part but now we have to wait for china my understanding is that what

they're pushing back on is we want a specific number for purchases. soybeans, et cetera, and they're not willing to commit to a specific number. and also we don't know what's in the section of i.p. and technology transfer and all of these structural issues that really, really are the core of the relationship and what we should be focused on there's still a lot to learn and, of course, we have to hear from china we haven't heard from their side yet. >> mr. secretary,the way you'v laid it out, the deal keeps getting skinnier and skinnier. we've whittled this down to what seems like an ag purchase deal now we have a number on how much of the agricultural products they'd be willing to bet on. what would you suggest doing at this point maybe we go ahead with this deal and hope for further talks with phase 2 and phase 3 and beyond >> yeah. i think if we can get a phase 1

deal which will essentially be halting hostilities. it's not going to be a major breakthrough and give us a little bit of time to assess our goals. what are we trying to do it's interesting, our trade deficit, which was the original idea with china, is leveling out. it has gbegun to narrow, which i good but with the rest of the world it's growing which means a lot of the production is moving out of china to other places. i think we should turn our attention to technology, to the future a cyber agreement between the u.s. and china i think would be the best news for the markets and it would be real because that is the issue. it's not about soybean purchases in the future. that tends to be very -- very tactical just kind of mercantilist. we need to focus on the structural issues, especially on technology i hope that the administration sets its sights that way in

round two. >> the cyber agreement is what that sounds pretty tricky. >> well, what -- how is china going to regulate its market is it still going to -- china 2025 is something they don't talk about anymore it's something that apparently they've walked away from but china 2025 essentially was a decoupling of technology trying to decouple china from the u.s., from the west on tech noll i think that would be a major problem for china, a major problem for us, a major problem for the world. everyone is going their own way. the european union has gdpr. india has its own scheme china, vietnam so the world is splintering when it comes to technology, which means we're not going to get the benefits and then, of course, the technology transfer. i do think that there's a little bit more leverage now because now china has some of their own

technology they want to protect whether it's huawei, ten cent or something else that's the big issue >> that's a big issue but i think it's an intractable issue too, mr. secretary >> yeah. >> because of security concerns that are there and have been raised even if there is an agreement reached on trade, you talk to somebody like the head of the sec, he wants to see chinese made equipment from huawei and zte and others no longer being put into rural equipment here in the -- rural communication companies here in the united states they are saying the same thing in china, that they don't want u.s.-made equipment or foreign-made equipment put into state enterprises. you're talking about a serious operation that has been exaggerated or is going to be really kind of pushed into a much firmer place over the next many months. >> i think you're absolutely right, becky negotiating a cyber agreement with china is going to be a lot more complicated than

negotiating soybeans, but what choice do we have? i think we have to give it a shot and we have to give it a shot with our partners you know, up until now with our allies, european union, japan, others, it seems that our policy has been to stop china from achieving their strategy so we're trying to convince countries, don't get involved but they continue to get involved we're trying to convince countries not to buy huawei but we just saw germany signed a deal with huawei to help germany build out their 5g network i think instead of trying to stop china, we should have our own strategy and how are we going to compete in the future it's not about bringing back jobs, it's about creating new jobs in new industries. >> mr. secretary, these are all the allies, people that criticize the way we're approaching china. these are all the allies that they're saying we should be working with and these are all

of the allies. let me ask you about usmca whether you think that's a positive, and does it address some of the -- in your view, the short falls from the original nafta agreement? are you happy about this >> it's fine it's got some issues that we'll have to manage through i'm just very glad that we're going to get this done >> yeah. >> mexico agreed on the inspections for the factories. that's a positive. the one thing to keep our eye on, joe, that we haven't talked a lot about is the dispute settlement mechanism that's been watered down substantially, and it's been taken away for manufacturers so it's only there forex tracttitrac -- for extractive industries. they have access to the tpp dispute settlement mechanism that's one thing that isn't being talked about, that is out there, that i wish could be a bit different, that i wish our

companies had a bit more protection the auto agreements are going to be very hard to manage 75% from inside the region this 40% with $16 an hour wages, it's going to be tough to manage, but we have an agreement. it's a good agreement. the estimate is that you would generate it from the u.s $65 billion of additional gdp. let's take it, let's move on. >> overall good >> i'm positive. >> enemy of the good, enemy of the -- whatever that expression is it's good enough to at least ratify and be happy about it and improve on some things so that's good >> yeah. yeah i think it's good to get it out of the way it's good to get the uncertainty out of the way on china this is going to be around for a long, long time will the agreement on structural issues take on anything other than state enterprise tsz. do we accept it?

do we accept that we have two systems that are going to have to co-exist? those are the big strategic issues that i think are so much bigger than how much are they going to buy. >> would you agree that this is something that we've been on a collision course with for some time we are two different systems they have operated along parallel paths but maybe this was an inevitable point. >> yeah, i do agree maybe we were headed towards something like his maybe not to this scope. we've always had our issues with china. we've always had some very difficult negotiations and every administration has made its own progress gradually but this is -- as you say, there's so much to unwind, whether it's sifius, whether it's export controls we'll tell china, you know, don't use technology transfer. they'll say, well, then sell it to me instead of putting in

export controls. it is just one vicious cycle i will say this, becky and joe, i don't believe as some people in the administration believe, that war with china is inevitable and i think that's a very dangerous assumption, very dangerous to believe that that is the future because we can just make it happen by insistence. >> you mean a trade war? >> no. no no no no i think there are people in the administration who believe that a conflict between china and the u.s., military, trade, economic -- >> mr. secretary, can you name some names here? help us understand what you're talking about. >> oh, well just look at some of the books that have been written about china and the u.s. you've had people on your show you had some yesterday bannon -- look, hold on. >> david, all sorts of people think that over time we are

headed towards some kind of -- >> i think that's a mistake. >> i don't disagree with that idea the idea of an outright war to the degree there's speculation about that, i'm not sure unless you're referring to peter navarro, doesn't know. >> there's navarro, bannon they believe that a military war eventually is inevitable by calling china a strategic rival. there's no question. they're a competitor if they're strategic, then that means we believe they're an existential threat if you call someone an enemy, they will become your enemy. we need to be careful. i hope that at this point we keep the war in the confines of economics, in the confines of trade. but this could get out of hand so easily and, yes, there are people who i believe just see

that in the future it is inevitable that we are headed towards conflict i think that's a dangerous assumption >> just because you're paranoid doesn't mean people don't hate you though, don't forget that. >> i do. >> chinese are doing some things in the south china sea we still have mad, don't we? we'll obliterate each other 100 times over we can't do that. >> the trade war is the same we're both hurting each other. who won? >> secretary gutierrez, thank you for your time. >> appreciate it. coming up, we'll talk tech and how can companies deliver for their employees and share shoulders. we're heading to break check out the futures, some whacky retread information that may have hit the futures back up and solidly positive not triple digits. 55 on the dow, 15 on the nasdaq, 4 on t she&p

welcome back to "squawk box. the dow is up 63 points.

s&p futures up by just under 5 points and the nasdaq futures up by 18. let's show you another chart. the s&p technology sector we just saw an all-time closing high one of the companies in that sector is online content delivery firm akamai they've landed on the latest list of america's most just companies. the just list ranks companies on nonfinancial metrics here to talk more about the impact of the esg movement on corporate america is akamai ceo tom leighton good morning nice to have you here. help us understand this. when you think about yourself

and the kind of metrics just looks at and esg, are these conversations you're having among management >> oh, absolutely. treating your workers well treating your customers well, worrying about the community and the environment are -- >> no, no, no, i get it. do you think companies are hearing from the shareholders and investors, are they talking to you individually, coming in and saying, hey, where are you on this and this and this metric >> yes i would say a sub set of the shareholders, that is of good concern. that subset is growing i think there's other shareholders, particularly those that only hold for a short time, maybe hedge funds, it's not really on their radar in terms of the question they ask. >> how old is akamai now 30 years old >> no, we're 21 years old as a

public company. >> but i remember it long ago. would you say that before you started emphasizing these things it was an evil company from its founding -- >> yeah. >> -- it was a good company with good intentions treating customers right, treating employees right? >> yes. >> okay. >> did you look around at everybody else that you were with and were a lot of those companies egregiously hurting customers and the environment and everything else? were you unique in beingthat >> no. to be honest and look around, we're starting -- >> do you feel -- do you think that the companies just started behaving like this in the past two years since paul tudor jones started this >> oh, no. >> so maybe quaker oaths m e era just company >> i would imagine. >> what are we doing other than --

>> no, i think it is good to put attention on it. >> why >> because i think it helps executives and companies make better decisions and i -- >> so they've been making bad decisions -- >> no. i think it helps them be more cognizant of it. it brings the -- >> it might provide some cover with shareholders, too >> i think that's -- >> and with lawyers. with lawyers, too. >> i was going to ask you, you look at your stock being up as much as it is. how much do you think that's a result of your market share and financial success relative to these other issues that are -- >> and what's a counter factor if you weren't bogged down >> the stock is up on the financials. >> he's a grownup. >> it's different from how you treat your customers and workers. >> it's hard to be a successful company if you're not doing those things >> i think so. over the long term, absolutely. >> the reason i asked though

about these metrics is whether you think companies are going to start meaningfully trying to say to themselves when you actually look at the end of the year, for example, at the metrics that you think you need to hit, that these things are now going to be on a list in a different way >> i think -- >> that's the thing. i think they might have always been in the back of everyone's head or at least i hope they were, but the question now i think that's being asked is whether something has fundamentally changed? by the way, it genuinely has changed in europe. i know that the boards actually sit around, if you look at the decks that they're looking at, there are actual metrics on the piece of paper. >> yeah. >> so my question is do you think that's coming to america >> i think it's happening more, and literally i look at a sheet of paper, where are we on the environmental impact >> right. >> we've got four targets, hitting three, one's iffy. >> how much of our power is going to be from renewable

sources? 50%. we're close. one of our providers had an issue with -- >> i was kidding about the counter factual. if you end up spending 60, 70% more on non-competitive renewables, i don't know if the benefit that you're supposedly getting from the environment is worth while with the profit margin you're going to have. >> technology companies have big, fat profit margins that allow you to think of these. if you are jcpenney, another company trying to stay in business, may have to -- >> you. >> i know that you are in a fortunate position to think of these. >> that's why he can push the industry forward and others can't. >> it iks ma a difference. sometimes it may look like you're paying a little bit more. our customers -- >> happened in germany >> judge us. it's part of the model, yeah.

>> part of the woke model. >> what would you rank on the just capitalist? tom, thank you you can join tom for the quarterly just conference call taking place in about -- well, little over 15 minutes 8:45 eastern time. you can register to listen to it at just capital. >> i'm very low on the woke list when we come back. breaking details on the read on the coumnser data. stay with us for all of the data and analysis

coming up, the economic number of the morning. we'll have it for you when "squawk" returns is the monolithic view of emerging markets obsolete? at pgim, we see alpha in the trends driving specific sectors of outperformance. where a rising middle class powers a booming auto industry... a leap into the digital era draws youthful populations to mobile banking and e-commerce... trade and travel surge between emerging markets. every day, our 1,100 investment professionals around the world search out opportunities for alpha. partner with pgim, the global investment management businesses of prudential.

doprevagen is the number oneild mempharmacist-recommendeding? memory support brand. you can find it in the vitamin aisle in stores everywhere. prevagen. healthier brain. better life.

welcome back to "squawk box. we are now seconds away from the latest import price data in november retail sales numbers. rick santelli standing by at the cme. want to get to rick with the numbers, sir >> reporter: all right, andrew november read month over month up .2. x petroleum up .2. much higher than expected. let's go big, year over year, down 1.3 on export prices month over month, up .2 year over year, down 1.3 maybe all of these export and import prices will get rejiggered of course, if phase 1 of the agreement actually is signed and shown on tv for verifiable proof now let's move to retail sales for november up .2. half of what we were looking

for. but there are some revisions last month gained .1 from .3 to .4. let's go x autos up .1. also on the light side also a positive revision of .1 in the rear-view mirror. strip out autos and then gas sales, it is unchanged so these are softer numbers. the control number that gets plugged in higher up the food chain of economic fundamentals up .1. we are expecting .3 and we leave .3 in the mirror with the consumer being center stage, the numbers are okay but they're definitely nothing near the warm to heated numbers that we were looking for. dollar index is the clear loser over the last couple of days down half a cent it has been drifting for several sessions we see that interest rates are off their highest levels easy perspective last week before a lot of this

excitement, the fed meeting we were at 184 at a close right now we're at 1.88. we did venture briefly right around and slightly above 1.90 yesterday. we want to pay close attention all the issues of supply, you know, we had 78 billion in supply, 30 years were a blowou auction. the reason i bring it up is because another tax day on monday and another settlement for this auction joe, back to you. >> stay with us, we're joined by matthew lizetti, chief economist at deutsch bank. let's get data reaction to this data from cnbc's chief economist, steve liesman i'm back to the promotion. >> thank you, joe. does that come with a check or not? >> no check. >> more days off perhaps >> there are no -- but you do get the "squawk box" mug. >> i get the mug. >> you can take it home with you. >> thank you very much look, these are confusing numbers. not the numbers we were expecting. roads or all signs were pointing

to a robust consumer spending. november is not half, not quite half but it's a decent and important chunk of the holiday spending season, and in places where it would appear to matter we do not have strength, we have department stores down .6 of a percent. miscellaneous stores down .4 sporting goods and hobbies and other places you might see holiday spending down 0.5. clothing down 0.6. possible there's some price effect in here these are nominal numbers. you do have a big jump the last two months in a row in gasoline station sales. 0.7, 1.7 i could also say it's possible there's a seasonal affect here because we had the short christmas season thanksgiving didn't happen until towards the end of the month it's possible some of that distorts it. the reasons why there was so much optimism about it is because you have the great job

numbers, decent wage growth, relatively low debt levels all signs kind of pointed towards an optimistic holiday season you cannot give up the ghost on it because they have a good chunk of december in which to spend. possible there's a seasonal adjustment factor in here. you have to say they're disappointing numbers that are likely to in some way bring down the outlook for the gdp. it had been on the rise. we had been going up from 2 to 1.5. we may be going down >> matthew, when did the outlook come out for 2020? >> we've been hoping to get it out. we've been waiting for what's been happening >> i was going to ask you. >> it's not really completely out? >> it is not >> wait, you picked the wrong week to quit sniffing glue you have brexit, usmca, china, so the whole -- that could change a few things. >> a lot of volatility certainly what you get could -- >> but you still have some

general views about 2020, about inflation and gdp. the jobs claim number, did that raise an eyebrow yesterday anything to be concerned with there? >> it did, the jump. with seasonal issues, with the thanksgiving holiday moving, you tend to get some volatility in the weekly jobless claims. if we were to sustain at the elevated levels, it would be a concern. it is inconsistent with the other data the strong jobs report that we saw in terms of what we've been seeing, all of the market data has been pretty strong the consumer data this morning is really important. we are seeing a slowing over the past several months from what was probably unsustainably high levels if you go six months ago. for the fed, the consumer outlook into 2020 is key because everybody has baked in pretty weak manufacturing sector, relatively weak cap ex trade is expected to be volatile

you need the consumer to be remaining above 2% to think you have a growth number next year. >> becky, can i ask you to walk me through how trade affects the outlook? i've heard economists say the effect of trade on the economy for 2020 is baked in at least for the first half what we're talking about now, is there a deal, is there not a deal is really a question for the secretary half and whether or not we get a rebound closer to or above potential if we were to get a trade deal in the next couple of days. >> i think that's fair we continue to think of the channel with business sentiment and cap ex the concern i would have over the next year is if we just have a handoff from trade policy as we get into the second half of next year, cap ex tends to be weaker particularly in the third quarter. it goes from ism manufacturing sentiment tends to be a bit weaker so even if you do get some dissipation in trade uncertai y

uncertainty, i think the outlook remains subdued. >> so very quietly because it's not public, tell us what your number is for next year right now. >> for next year, you know, we've been thinking about numbers around 2%. we're right at 1.8% right now. and so around 2% growth would be the expectation for next year. if you get a trade deal i think that could add several tenths to that outlook as we look at the fed, we have them on hold over the next year. i think if you look back to the press conference on wednesday, the most interesting story i think was how hard chair powell pushed back against the upward drift that was in the dots as you have a fed that is worried about low inflation, worried about low inflation expectations, at some point they may be forced to act on that you get the policy review in the middle of next year. that could be a point that pushes us in that direction. >> got to go rick didn't say anything

rick, are you still there? i guess he's gone. all right. >> we have some new headlines out on china trade china's state council information office now saying it's going to be holding a press briefing at 9:30 a.m. eastern time let's bring in eunice yoon from beijing. eunice, that's 9:30 p.m. your time and we're going to hear something potentially? >> well, it looks as though that's the case. it's actually 10:30 p.m. beijing time we're 13 hours ahead of you. we got the news that said yeah min who is the deputy director of the financial ministry and wang cho wen are both going to be there in addition to other chinese officials. these two people are very important because wang cho wen, the vice commerce minister was one of the leaders on the

working level side for the trade negotiations and soon it was kind of taken over by yao min. these are two very important people when it comes too these discussions. they are going to be heard that they didn't have anything planned for a statement or a press briefing but had asked us for some questions the question we had for them was whether president xi was going to accept the offer by president trump. we'll get an answer to that one. but also separately what was interesting is that the global times, which is a communist party paper, had flagged this saying reporters were also already in place and ready though the timing of this, a press briefing, was going to be delayed. the editor in chief of the global times also hinted as to

what else would be discussing saying that the trade talks as far as he knows have moved a step forward but how to define the step and what real significance does it have, the answers lie in joint efforts of china and united states. so a bit cryptic but still someone who is quite influential with the trade negotiations, especially because of his position as editor in chief at the global times guys >> one of the issues, eunice, we've been thinking we've been dealing with a deadline of sunday at midnight before a decision needs to be made. kayla pointed out earlier this hour that a rule would have to be changed by today in order for those new tariffs not to go into effect so maybe that speeds up the time line right now, particularly given how late it is there i guess already looking at past 9:30 your time >> reporter: yeah. actually, i had heard the same

from my government course who had said that the likelihood of there being an announcement within the next day was quite high because it would have to be done before the tariffs. of course, anything is possible and there is a possibility that the negotiations would continue past the tariff deadline, but i heard the same thing that kayla had. >> steve liesman is here steve, from the fed's perspective trying to read what they may or may not do. >> it's really interesting if you saw, one of the biggest reactions, we had a big reaction in stocks and a big reaction in bonds. ten basis points higher on the yield and that suggests that if there is a trade deal, you could be looking at higher yields, better global growth, maybe a little pressure on inflation the one place i'm looking at, the sort of deep space probe, if you will, on what the market is thinking about the fed and trade, i look at the july fed futures, what you saw is you had a kind of -- more or less

ambivalent sense there might be another rate cut in july you look at july in the wake of a possibility of a trade deal and that probability has come down the first step the market is taking here with the possibility of a trade deal, possibility of better global growth is to reduce the chance of a cut in july and i don't think it's necessarily going to bring the fed back in at a possibility of hikes but we're going to get rid of the possibility of cutoffs. watch bond yields. global growth from the lessening of trade tensions, the possibility of positive developments on trade would get built back in there. >> steve, thank you very much. eunice, thank you. when we come back, we've got what you need to know about a market that could be emerging from a will they or won't they obsession with u.s./china trade talks. maybe not. as we head to break, check out the futures. dow futures up by 74 points. s&p up by 6. nasdaq up by 23.

stay tuned, "squawk box" will be right back it's not about quantity. it's about quality. no trendy stuff. i want etfs backed by research. is it built for the long-term? my reputation depends on it. flexshares etfs are designed and managed around investor objectives. so you can advise with confidence. before investing, consider the fund's investment objectives, risks, charges and expenses. go to flexshares.com for a prospectus containing this information. read it carefully. have you ever worked with dr. francis? oh yeah, he's ok. just ok? guess who just got reinstated! well, not officially. nervous? yeah. yeah me too. don't worry about it, we'll figure it out. i'll see ya in there! just ok is not ok. at&t has america's best network, now with our best plans, at our best prices, starting at $35 a line for 4 lines. new from at&t.

this morning we heard from boris johnson vowing to take the u.k. out of the e.u. come january 31st the fact that the numbers should suggest that it will be much easier for him to do this than it was in the past still uncertainty remains and the big question will be the trade deals he's able to strike. we've already heard from president trump this morning congratulating boris johnson and

dangling the pros spent of a massive trade deal between the u.k. and u.s. post brexit. in terms of market reaction, we've seen quite strong moves here in the u.k. sterling jumping 2% versus the dollar on the back of these results. we've also seen very strong moves in domestic u.k. stocks, so those names that were suppressed by the brexit uncertainty. one other thing to keep an eye on as we head into next year is scotland the scottish national party also performed very well. they have vowed to push ahead with another independence vote watch this space as we head into next year. the bottom line is a brexit seems much more certain today than it did just 24 hours ago. guys >> julianna, thank you very much. also, some big developments on the china story this morning. futures have been swinging on conflicting reports about whether china is committing to the agricultural purchases we expect to get more clarity at

9:30 a.m. eastern time that's when china's state council is issuing a briefing to talk about issues on relative progress of china, u.s. economic trade consultation joining us is j.j.kinehan and also mike santoli. mike, let me just ask you. we've been playing this game for a long time. yes, they're going to sign a deal no, they're not going to sign a deal what happens today feels like this is some sort of a culmination. >> it is it's a culmination from this entire process from the market's perspective it's more about do we suspend the tariffs due to go on sunday? do we get beyond that? we spent yesterday pricing in a likelihood i also think though it's important to recognize that all happened on a day when we got some clarity on brexit, when you had the fed come out and say, look, we're going to do

everything possible. we're not going to allow stress and we got movement towards a federal budget deal. so you had this moment in the markets where it's kind of like what's there to worry about if, in fact, we get over the line with china the question is had the rally already told you there's a lot less to worry about. would that create more and an up side chase >> i don't think everything's -- it's great that we had all of this stuff but i still think it leads to a lot more questions to be honest with you, becky. with wrecks it, it's great that we have clarity on what's going to be done no one knows the process because no one's ever done it before with the china deal, also, i warn people about a little bit of exuberance because until pen actually hits paper and we have a true agreement on something, it just makes me a little bit nervous that it's the constant promise, promise, promise, promise. we need to see something that's a little bit delivered actually, as i think we head today and into next week, i

think next week becomes one of the most interesting trading weeks of the year because it's the last full week where you have a full roster, so to speak. people start taking off for the holidays it will be interesting, i think we've seen a lot this last couple of weeks of people trying to catch up a little, get names into their portfolio we'll see if the momentum can carry in. >> is that your plan, take profits? >> overall, it's not the worst idea you know, this has been a phenomenal year for many, many stocks and not that you have to take off your whole position but you can certainly take a little bit off and, you know, take some risk off and lower your cost basis. nkts hey, mike, as we get into the beginning of next year, we have to get through the next couple of weeks. what do you think the big issues are that will kind of be pushing trade one direction or another

and by that i don't mean trade talks, i mean trading on the is right now are going to be let's make sure the economic numbers do improve as the markets have been trying to indicate and handicap for a few months right now f y now. if you get a trade deal of any position, you don't have the kind of friction in global trade throws, addition of what we have, i think the markets can give it a pass for a while and say we have confidence that things are going to get better even before the numbers actually do the big question is, are we going to see a real kind of speculative rush and have sentiment get way ahead of itself and have some kind of real blowoff before we get to that point we're not there yet in my view but that's probably the thing to look for is to see if sentiment gets a little bit too happy, and therefore trading positioning gets a little vulnerable i don't necessarily think we have reached that yet. >> we had one guest earlier this week pounding the table saying, look it going to be about earnings next year, all the

companies will come in with better earnings. the economy will look better than anticipated and that's why stock prices continue to climb what do you think of that scenario >> we have that opportunity for earnings to look better. we still have some of these other issues overhanging i will tell you one thing that makes me nervous as we head into next year, the fact that we haven't really heard companies talking about spending money on infrastructure, and i think as we look, you know two years out, that's the thing that makes me most nervous, companies have held back for the last six to nine months on spending money and infrastructure as we had this tariff situation overlooming. and if we don't start seeing that soon, that's the kind of thing that really is going to make the road a lot tougher as we get further out in the shorter term, i agree, i think earn ings will look bette, it makes me nervous if we don't start spending some money now it will be difficult to continue the growth path that we can be on. >> j.j., mike, thank you very

much >> thank you, becky. down right now to the new york stock exchange, where jim cramer joins us now. want to get his thoughts about china, about brexit and whether you think that's going to happen, what you think it means to the market as we head into the weekend. >> how was the champagne never told me. >> i know. that's why i'm asking -- >> existential part. >> bringing the tweet to life. >> will be good. >> jim >> i'm still waiting to hear how the champagne was, andrew. >> the champagne was fabulous. >> now we're talking >> i'm still feeling the champagne now, this morning. how was the cake in. >> i had to do that to you sabotaged with great champagne i think the idea, at some point in the wall street journal that the president was going to roll back, half the tariffs and then cancel, that's the straw man i think there can be a deal, but that -- that's never been the

president's position and i'm not sure where the journal got that i think it is something much smaller and -- that whole narrative about slashing existing tariffs by as much as half, andrew, i'm saying that's wrong. i'm saying that was not in the cards and is not in the cards and won't be. >> and therefore but you think there will be a deal that the chinese who obviously have been relatively silent thus far, we think we'll be hearing from them soon, are going to say, what and do you think it is going to be -- whatever this deal is, do you think it is going to get -- it will have teeth and get you where you want to go >> i don't think -- i think it gets wall street far enough, does it get the president where he wants to go if we don't see a gigantic pork buy in the next really next 48 hours, we're going to come in here on monday and the tariffs will be on the chinese are spreading a lot of information about what they think the president is offering, but the president is not confirming any of that it is so -- it is so fluid now, andrew i've been working on this for last four hours and it changed,

like, it changed like twice already. there is no rollback by half, that story is not accurate >> and you were responding -- >> you guys -- >> all these people that think china is an existential threat, were you responding with that tweet, jim >> absolutely. absolutely no ifs, ands or buts the idea this isn't -- the october 4th speech by vice president pence laid out the strategy, 1947 george canon piece out of the soviet union laid out the strategy. i'm not going to be naive about this i'm not going to say general mattis would tell you that there are real issues with the chinese militarily i think general mattis, one of the great military minds of our lives and he says it, so i don't know mr. good year is a really good man, but i think we got to think -- it is not existential, it is real existential makes it sound like starter kamu, i'm talking about military, us funding their

military, i am not a -- am i jingoist on this thing i'm a realist. i think he's not realistic >> jim, we got to run. the real question, very quickly, going into this weekend, how do you want to be positioned? >> i presented a group of trades last night on the show, that i think work into monday on a deal but they're all trades i think we have to go back and start focusing on the eli lillies and the united health. this thing is too crazed we don't want to hurt people, up and down it was good stuff, my friend i'm grateful and as i said, if you can hear it in my voice, i feel it. so thank you which cake did you like the most >> the carrot. >> the carrot, yeah. >> i'll see him on saturday. there's other people. >> thank you, jim. >> we will all see you tomorrow. don't miss an exclusive interview this afternoon with

morgan stanley chairman and ceo james gorman now coming your way on closing bell, 3:00 p.m. eastern time stay tuned you're watching "squawk. when i lost my sight, my biggest fear was losing my independence. 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.

it is already working in cities like tokyo. investment opportunities beyfirsthand, like biotech.ne because your investments deserve the full story. t. rowe price invest with confidence.

welcome back chinese officials have been silent since reports emerged yesterday that trump

administration had agreed to a phase one trade deal they'll break that silence at 9:30 a.m. eastern, which is 9:30 p.m. -- 10:30. it is night. so it must be important. it is a news conference to talk about economics and trade it says futures were up. join us next week. "squawk on the street" is next ♪ >> good morning, welcome to "squawk on the street. i'm david faber with jim cramer. we're live from the new york stock exchange carl has this morning off. let's give you a look at futures as we get ready to wrap up the trading week you can see we are set up for a higher open. road map this morning does start with trade volatility, of course china and the u.s. closing in on a phase one deal president trump reportedly si