we saw what happened with cbs and the s.e.c. rights, they had the window to extend and they decided not to they tried to bid and looks like they're not -- >> merry christmas very special -- merry christmas to brian thank you for being here mcc, thank you. >> see you thursday. >> see you thursday. tom farley and wonderful blazer. so great. >> with all of you. >> happy holidays, happy holidays to everybody. have a wonderful christmas and we'll see you on thursday. "squawk on the street" begins right now. ♪ good tuesday morning, welcome to "squawk on the street." i'm carl quintanilla with david faber at the new york stock exchange cramer has the morning off joining us, jim stewart with "the new york times," cnbc contributor, author of "deep state. rally rolls on today we think as the nasdaq goes for ten consecutive gains, only two times this decade as it managed

such a streak. u.s. equities close at 1:00 eastern. road map begins with the santa rally. nasdaq with nine consecutive record closes, longest streak since 1998. >> retailers bracing for that last minute rush on this final shopping day before christmas. but delivery companies also under pressure from the late push. >> and wework's co-founder may have big reasons to smile this holiday season a report says his $1.6 billion exit package could get sweeter we'll fill you in. with markets in record territory, investors are in a better mood. the 2018 christmas eve period saw the dow tumble 653 points. s&p down 27. nasdaq 140 drop. since then, those stocks have surged the nasdaq leading the major indices with a 44% gain since then we forget, december 26 we came in the day after christmas, and the dow and the s&p rallied 5% it was wild a year ago.

>> i remember vividly sitting on christmas eve, watching this show and i probably shouldn't have been doing that on christmas eve. i was, and it was plungingsinki thought wait a minute, it is christmas eve, it is the stock market, it goes down, it goes up, i won't let it ruin my holiday. i put it aside i had a great time but it was pretty grim you were delivering lumps of coal a year ago at this time. >> the everything rally, how everything rallied this year as the fed has cut three times, trade tensions lessened and argument for next year is that multiples have room to run you can be looking at 19 1/2 times 178, gets you close to 3500 on the s&p. >> that's true i was looking at the multiples myself, rough gauge, are we at any kind of overexuberant territory. they're starting to get up

there. i would say looks kind of fully valued without a pretty good growth in earnings trajectory. i see no reason why we wouldn't have that. i think a key factor that maybe some people have underestimated is this incredibly low unemployment rate with money flowing into the pockets of some marginalized workers who haven't had a regular paycheck in a long time and consumer spending is a big part of the economy, that's going to provide a strong floor, especially the -- some of the basic products and materials that retailers like walmart, do cater and respond to people who are not -- have not been that affluent before. >> i think we got some news on uber. >> not perhaps that big a surprise if anybody who has been watching, the sale of stock, he sold almost all of his ownership in the company he will be stepping off the board of directors

uber announcing that mr. kalanick will resign effective on the 31st of this month to focus on new business and philanthropic endeavors. a nice quote from the current ceo. remember mr. kalanick had been involved in, well, a lot of tension there from that period of time when he was in control and then gave up the ceo ship, but retained significant ownership stakes but that has changed significantly. josh lipton, you've been following this through the time that he started to be a seller and picked up dramatically one can imagine that would be followed by his stepping down from the board >> yeah, i think, listen, as you just mentioned, maybe not a big surprise here. travis kalanick has been systematically selling his shares since november 6th. as you point out, maybe not a huge surprise here he was on course to actually completely exit his stake from the company. you remember the co-founder,

former ceo of the company, he actually sold about 2.5 billion worth of shares in the company, since that lockup period expired last month he actually -- he had less than 10% of his holdings left according to public filings. not a huge surprise here but a big step, a huge milestone in for this company, the founder of this company, gets a lot of credit uber, a lot of people say, would not be where it was without kalanick analysts, bulled up on this stock, would talk about as you mentioned there some of what they refer to of the excesses of the company under his watch. probably not maybe too surprising for investors given what he's been doing with those shares, david. >> it is funny, josh, because there has been this sort of story out there for some time, certainly given the performance of the stock since it went public and what has been a poor performance, this idea that kalanick would somehow come back, steve jobs at apple, clearly we cannot i think

dismiss that but there was a thought. certainly we know the downside plaintiff c of mr. kalanick's time, but many say the company lacked the energy and passion it may have had during his period of time as well >> well, we certainly heard that stated, david. we look at the recent performance of the stock obviously. it has been rocky under khosrowshahi when the company last reported, listen, they are on track for the ebitda profitability by 2021, some bulls grabbed hold of that there was an all great news with the last report either, some metrics came in slightly less than what the street is looking for. the stock took a hard hit that day on bookings and users. kalanick's move here, the systematic selling, you talk about the energy, but it was interpreted by some as perhaps a lack of confidence in the company's future so we'll see how investors react

to this headline >> we're looking at video here a moment ago of travis on ipo day, awkward dance between him on the floor along with other members of current management. hard not to think, though, you can't blame a founder for diversifying their portfolio but, liquidating your stake is an indictment. >> i wouldn't necessarily jump to that conclusion this is a fairly interesting -- but very specific situation where i think it was very awkward to have the founder with this substantial ownership stake, who had supposedly rehe li relinquished all management site i think for the health of the company, he really needed to remove himself both operationally and from an ownership position i think that's because -- i met kalanick i thought he was very smart, very charming. came across as the fire breathing dragon there has to be a significant

shift here from the kind of hard charging aggressive, upset the apple cart, thumb in your face, we don't care about the local regulations to a global charm offensive to win over regulators that has gone from a scrappy upstart to a very major established company that threatens existing interest and travis is just not the right person i think he did need to sell. >> i don't know. i don't know. >> if he didn't, he's like -- what is the ceo going to do when hegets the phone call from the huge shareholder >> he had a lot -- he had a number -- a lot of influence, a number of -- initially a number of board seats that were given to him, remember they had the big fight with their venture investors as well. kalanick and khosrowshahi came in and we forget the drama that took place there but there are a number of people i think who still view him and i spent time with him as well that think there is something

missing, that founder energy and passion and now willingness to sort of fight for every last inch is missing to some extent. >> well, i'm sure it is missing. and that -- isn't that the story of all of these, you know, high flying innovative upset the apple cart upstarts? they have to at some point make the transition from being, you know, the scrappy newcomer on the block, challenging the status quo, to becoming part of the status quo when exactly is that going to happen it is never going to be perfectly timed or very easy there have been many examples of founders that have trouble making that transition. >> you think about founders, zuckerberg comes to mind as the founder still on top, still every day making those key decisions for arguably one of the most important companies in the world. >> a really good point can you imagine zuckerberg not even becoming chair emeritus, leaving the board completely and

selling all but 10% of what he owned? >> i agree, it is hard to imagine. but that said -- >> bezos, could you imagine that no, you couldn't. >> no. >> i can go through a bunch. mr. musk, you covered, could you imagine that >> no, but here's the difference they have succeeded. they may be the exception rather than the rule. they have -- there are various transitional points in the histories of these companies, but they have made successfully the transition to, you know, upstart, into establishment companies. though let's acknowledge they have been running into some problems as they have become the biggest kid on the block there are a host of regulatory issues they're confronting now that they didn't before. massive problems that come with their success. and i think that the jury is still out on how successfulfully

they're going to navigate this new set of challenges to growth. >> speaking of which, price is still here at 30, 40, a third below ipo at 35. are you -- what do you think about the prospects for ride sharing and all the ancillary businesses you see us getting back to 45 anytime soon. >> i wouldn't predict the timing of it. i've been positive, i've been bullish on the story for both the uber and lyft. i think these are transformative companies. i think, yes, they're going to -- they're meeting head winds here, very powerful established interests trying to block them the model is very good and especially as you move to self-driving, self-delivery, you start solving some of these environmental problems now i think the future is very bright i think this really is transformative model that could end up being very, very successful. >> that's going to be the key story for next year. the degree to which they get out of markets with eats, they're not number one or two, and how

the unit economics work as we get closer what kind of advances we make toward autonomy in the years ahead. >> it will be interesting to watch the story play out uber attracted a few more bulls. one -- you know very well, i remember jim, jim cramer, a few weeks ago, late november, thought, with the lockup period behind it, i remember jim thought it was maybe time to take a look at uber. in terms of jim stewart, my old professor at columbia, make a great point, different companies, different points in their history, have need for different kind of leaders. at one point you need kind of maybe the scrappy founder and maybe the feeling that now you need more of the kind of professional operator and travis kalanick himself, listen, he's moved on he has new ambitions as well he's an venture investor now in cloud kitchens, but certainly an interesting headline and one i'm sure investors will be paying close attention to.

>> we'll keep an eye on travis as well. he's an interesting fellow and as you say, cloud kitchens or ghost kitchens, seems to be putting a lot of capital behind them josh, thank you. josh lippen to repo en tlipton t a day after firing the ceo, we'll tell you what boeing is telling its suppliers to do. also ahead, if you thought there was outrage over adam neumann's -- speaking of founders who stepped aside, $1.6 billion golden parachute, hang on it could be getting even bigger for the wework co-founder. another look at futures as we get ready. shortened trading session today. we end at 1:00 we may have higher open, a lot more "squawk on the street" straight ahead he's finally here! hey! how are you? i'm good. ♪ how are you?

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to do the extraordinary. take your business beyond. ♪ ♪ some new developments at boeing, a day after the firing of ceo dennis muilenburg the company told its 737 max suppliers to suspend parts shipments for a month beginning in mid-january the jet still grounded and airlines have taken max flights off their schedules as far forward as june. some of the news outlets have a look at filings on severance,

the supplier part is what is interesting. the companies have to decide how many workers to furlough or lay off for a month at least. >> we have known that boeing sits at the middle of a huge economic ecosystem so far they were buffering the impacts of all of this by keeping production going and now the time has come where they're having to shut this down we are going to see some substantial ripple effects moving through the broader economy. >> and discussion continues this morning about calhoun. and whether or not it is enough, heard on the street, probably not. >> more people need to go. >> i don't think you hollow out the company at a time when you're still dealing with the prices we have never really gotten an accounting of exactly what happened and who is responsible. but everyone in boeing is not

incompetent or responsible for this particular thing. it will benice to know they have pinpointed the responsibility and taken the right steps, but short of that, i think they need some continuity here. as well as change. >> yeah. >> you have to have a mix of both. >> it is a difficult industry from which to pluck somebody from the outside, not that you can't do it obviously. calhoun was a board member before becoming chairman, difficult to find operating people who you can just put in here, particularly in the midst of a crisis, as they have been undergoing you could argue maybe the board could be up for some recomposition at some point. >> well, yeah. and we still don't know why the board waited as long as it did, they did take action i've also been wondering, could there be a silver lining for boeing here. when this thing finally the max finally rolls down the runway, surely it is going to be the most scrutinized aircraft in the history of aviation. and, you know, as a flyer, i

would feel maybe there is something really good about that it is going to be the safest plane in the air i hope that's the case but god knows they are really going over every single detail on that thing. >> your point about the complexity of the company's operations is well taken and you added yesterday the point about safety being the completely other important element to their operations and calhoun's been on the board of cat, experienced ge where you're dealing with multiple suppliers and precision manufacturing. i guess to that extent, his experience is critical, right? >> and definitely. and if they have solved the technical problems, i hope they have, then the communication function going to be absolutely critical it is going to be reassuring a vast number of constituencies, starting with the flying public, the congress, the suppliers, the airlines, that vast, you know he, network of people they deal with, that's going to take a really, really skilled

communicator to inspire confidence that it is safe and that that's the primary mission of the company and it really -- i think the biggest failing of boeing was from the beginning, not to recognize what a catastrophe this was >> as jim said, on the phone yesterday, david, he believes that muilenburg's exit was almost a condition of get the plane back in the air, through the faa's eyes. >> it may have been, worsening relations he had, reporting from phil lebeau and others, with the faa. and by the way, the frustration of his board and some investors with what had been continually incorrect assumptions he was making in terms of when the plane would be returned to service. >> not only incorrect, but they were incorrect always in the same direction ie overoptimistic. >> right >> nobody would have been upset, incorrect to say it is going to be june and turned out to be april. >> right. >> it was consistently too positive

>> yeah. >> i think, you know, optimism is a good quality in a ceo at some point it becomes delusional >> yes when we come back, wework's co-founder adam neumann speaking of optimism could be getting more money to walk we'll talk about the golden parachute. futures here, cast of the nutcracker on the floor of the nyse on this christmas eve we're back in a moment through the at&t network, edge-to-edge intelligence gives you the power to see every corner of your growing business.

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"squawk on the street" live from the financial capital of the world. the opening bell set to ring in over three minutes on this christmas eve. shortened session today. stocks close at 1:00 p.m. eastern time bond market closes at 2:00 tesla has been an interesting story obviously. hit 420 yesterday. all time high. musk responded with some tweets of his own saying, whoa, stock is so high, lol. today, adam jonas at morgan stanley has some thoughts on the stock at 420 we are not bullish on tesla longer term. especially as overtime we believe tesla could be perceived by the market more and more like a traditional oem. we are prepared for a potential surge in sentiment through the first half of 2020 but question the sustainability, seems like we have seen that surge to some degree, right? >> right >> i think the question that adam is posing there is a good one. is this an auto company or is it something else if it is an auto company, some

day the valuations come down to auto company range i tend to go with musk, this is not just another company it has got -- don't forget the solar thing, the power generation, the battery operations, power, that's a huge, huge potential market for them, as we move into self-driving, artificial intelligence, who knows what frontiers they're going to be able to master i like the story i think it is -- it has the potential to be way more than a car company. >> i hope this isn't in the speculative stewart portfolio. >> some companies who value on metric, revenue, cash flow, earnings, others you value on the story. that depends how got story is. i happen to think that tesla has a good story, uber has a very good story i don't believe that about everything but i think these are good

stories. readily acknowledge you're buying the story here. you don't have any numbers to support these valling with a vas >> you're not turned off by leverage, clearly, rates at this level? >> not in these early phase companies like this, you have a lot of leverage, a lot of venture capital in there it is too early to use those traditional -- >> i will say this, coming back to looking at it from an m&a perspective, 420 tweet, of course, oftentimes we see boards that say no or perhaps should say no and in this case, as fleeting as it was, unlikely as it was that he was going to be able to take over the company, you can make the argument if you had and closed the middle of this year, you would have gotten your 420 in cash here you are not that much later and perhaps, you know, another example of when it is right for a board in cases where it is more likely to say no that price is not high enough, that's not good enough we would rather take our chances. >> right, well, the 420

valuation was not musk's -- he did not use any financial analysis that we know to come up with that number you're right >> there is the opening bell and the s&p 500 at the cnbc real time exchange. the big board, as we said, it is the new york city ballet celebrating the annual production of the nutcracker at the nasdaq, usps operation santa as these santa trackers will be in full force and already is around the world. will be here in the states in just a few hours been a lot of talk this morning on "squawk" about netflix which is the -- >> i like that what is that >> no idea. >> got the fire, got santa across the globe

>> that is great netflix stock of the decade, best s&p stock for the past ten years, 4,000%. today there is some wire reporting on comp for next year. reed hastings and ted sorentos whose payment structure is different. one is much more reliant on options. >> but it is interesting, they're both -- it is the same total number and by the way, ted is making 20 million bucks in salary, and 14.65 million in annual stock options, these are vested options by the way reed hastings, $650,000 salary, 34 million in stock options. the two of them together, it is the same number which is interesting, the board chose sort of to go in that direction. shows you how valuable he is, viewed as well

there is some pretty big numbers, nobody can argue that reed hastings has not created an enormous amount of -- >> think how netflix has transformed the media world over the last decade. where, you know, people used to, like, appointment tv and wait for each week for a new episode of something and now people binge watch, they can get anything they want, anytime, they push a button and it comes streaming in, great quality entertainment. it has been an extraordinary run. and, again, i think the compensation, it is very performance oriented which i -- as a share -- not a shareholder, if i was a shareholder, i would want that. >> we spent a lot of time discussing what the next decade is going to look like for this company. one that is going to include and does already include a great deal more competition than it faced early on and whether or not see domestic subs and the entrance of disney plus, the expected entrance of hbo max

early next year, the peacock entrance, a streaming and supportive service from comcast, not to mention the existing players as well. it is getting rowded we all know that will be interesting to watch netflix in terms of how they choose to go about weathering that and whether or not their budget needs to continue to increase from what is already stratospheric numbers >> there are two big questions over the next few years i'm fascinated by, one is how many streaming services is the market going to support three, six, ten. i know it is not 100 like we have on cable. but that number is going to be very critical to determine what sort of ultimate profit margins these companies are going to be able to realize. the second big question to me is do you -- can the franchise model, that disney used so successfully be transformed over into this streaming area disney is without question the leader in established

intellectual property. they're doing the mandalorian, spinning out the brands. netflix doesn't have the big franchise, they're inventing, and good for them, they have done amazing original programming. but that clash will be very, very interesting to watch i think as well. >> president on the tape talking about north korea, saying if there is in fact a christmas week surprise, we'll deal with it says this is literally a headline out of reuters, trump says north korea's surprise might be a nice surprise, maybe a vase i wonder if you think geopolitics could come out of nowhere if you think the north koreans are testing us >> geopolitics can always come out of nowhere and relatively few of those events, i think, end up having huge impacts on the market you see something like world war ii, that's just like monumental effect on the global economy

but these little short-term provocations, i think, tend to be fleeting. but the risk is always there i was reading an article recently that somebody was saying, there is always something bad that could happen tomorrow, but we can't go through life planning or anticipating things that we have no control over and have no way of knowing so, yeah, the risk is always there. >> north koreans tend to use periods like this one, where news flow is light to try to get the most attention that they can around the world >> on the other hand, i have it say, i wasn't aware of a north korea threat until the tweet >> potentially planning another missile test, which is, you know, which is what -- maybe we're just going to get a vase i don't know what that means you think about threats, though, jim, it is funny, the one that comes up most often when i talk to senior executives or boards or ceos is the cyberthreat

actually and is the concern that at some point there is going to something very significant, perhaps catastrophic that would get everybody's attention. >> right >> hopefully it never happens. it seems to be paramount concern of a lot of people you can imagine why, of course. >> there seems to be a lot of smart people around the world who devoted their lives to penetrating, disrupting, hacking, i don't know what motivates them, but they're out there. and i think the test is going to be who is going to win this battle, the disrupters, the criminals or the people trying to make these systems safe i would like to think that we can put the resources there to block these people, but they -- let's face it, they scored some pretty shocking successes. >> and/or governments like north korea or iran or russia. one of the more interesting stories over the last year, i won't be here next year, i can start talking about the year end stories, the collapse almost, almost collapse of wework. adam neumann, the company's

founder, the ceo, he's still in the news he could be getting more walking away money from wework golden parachute could balloon to as much as $2 billion, that was from $1.6 billion deal this is according to the ft. the additional 350 million or so would come if there is a successful ipo, neumann owns millions of profit interests and they pay out f all this began because the company's failure to be able to actually come to the public markets. perhaps rare instance where the public market said no, we don't want it. and we are not going to buy it and we're not going to value it anywhere near what you think we should that, of course, created an entire series of events that led to his leaving and softbank taking control >> i think the neumann compensation package is one of the astonishing stories of the

year and the idea that you would have this massively visible failure, with even questions being raised about is this whole thing a house of cards in any event and then the founder walks away with 1.6 billion, maybe an extra 350 or something, but let's look at 1.6, that on the face of it shocking what was the leverage he had in order to negotiate that kind of exit package i suspect that it is very similar to what we sometimes see with borrowers you think in a borrowing relationship, the lender has the upper hand but there is a tipping point, if you borrow enough, you have the advantage and he had one major financier in softbank and billions of dollars at stake, so they could let him go, he could be nothing, the thing collapses, they lose billion, he loses his net worth, big deal, or they sink more money and pay him out

in the hope that this can actually continue. and ironically the -- once you have managed to extract that much money out of a single lender or investor, you have tremendous leverage. >> that's like the old joke, right? you owe the bank a certain amount of money, it is the bank's problem, not yours. >> it does happen. >> it is a great point it is a great point. many of wework employees, some of whom are laid off, feel very differently given what happened to them versus what happened to the company. >> i'm afraid it is these kind of stories that fuel anti-capitalist furor out there in the public. and i can get that it was like the same thing on wall street, where the banks are in the brink of failing and the government stepped in and, you know, bailed them out and the ceo has the huge pay packages. that was corrosive i hear people saying, how could this stock get that kind of money in capitalism is corrupt it doesn't -- it is not fair nothing is perfectly fair.

i think this is an aberrational situation. >> it comes down to one person here, that person is masa son and his decision-making and his willingness to bet fully on mr. neumann as he likes to do with other founders as well no softbank vision fund, no masa to run it and get those enormous checks and this is a different story. >> well, and, again, the stories i read about how he swept through, you know, neumann gave like a tour of the office, and then suddenly said, okay, here is a check for $4 billion, i mean, wow, this guy neumann man -- he must have known how to key into this guy. if nothing else, he knew how to read his investors. >> he does very charismatic gentleman who also could connect well with people it is not like he didn't -- there wasn't something behind the ability to create this company. still there and marcella claret is the chairman and they're trying to figure out a strategy that means weworks survives and

thrives into the next decade. >> from the president speaking in florida, he does say that the china deal is done just working on the paperwork. and that there will be a signing ceremony on the china deal that's going to be a big story in early january, we get a look at the text, how much of this commitments to buy, anything american is on paper and then the degree to which we get the two together, xi and trump to sign this. >> right it has been -- i assume he means phase one is done. and i think people have been scratching their heads trying to tally up, well, what do we give up, what did we gain, what is -- is this a net positive, it is a huge relief to the market that at least this phase or the fighting seems to be over and there aren't risks of greater tariffs on this. the jury is still very much out on the details of this and whether in the end we gain -- >> with all that, with the president's comments, and the premarket action, we're taking a bit of a breather on some light

volume, dow down 11. to bob pisani. >> happy christmas, merry christmas to everybody 2 to 1 advancing to declining stocks big story, every day, the breadth of the market advances, broadening out, that's one reason we have new highs here. feel like you like that fire the sectors are cyclicals that keep moving here this month. energy stocks, metals and mining, real estate a little weak, some retail mall reits had some issues. we understand what that is and oil and gas and exploration companies, they're having a little bit of a moment here, moving up. you get this mean reversion, the old losers tend to be bigger winners in the new year. december last year, we talked about this yesterday, what a cascading series of events it was, up until this moment last year president trump tweeted he was tariff man on december 4th, a drop notably on the s&p, 3% that day. december 19th, fed hike. that created a cascading series of four lousy days in the market, culminating today,

december 24th, down 2.7% we had steve mnuchin making confusing comments, ample liquidity, nobody knew what he was talking about. others said it was discussions about powell and the federal reserve and the economy and how things were doing and everybody was confused by the end of the day on december 24th we had a bottom of some sort at that point, remember what was going on take a look at the markets here. by that time, december 24th, we were down 15%. so take a look at the s&p, there we go, tariff fed hikes and we bottomed and bounced back in the last couple of days. good news is all that is over. we don't need to worry about it. everything is the opposite of what it was on december 24th of last year. trade and tariff war, heating up last year, now hopes for truth the fed was raising rates last year now neutral and cutting rates at the end of this year global slowdown, worried it was cascading down, very big earnings recession, doesn't happen, talk of a bottom and no

talk of a recession first part of 2020. we had a u.s. government shutdown looming that was a big issue faded in everybody's memory. that's what is happening we have no shutdown. is the market going to be up or down in the next year? i get this question every time this year and the answer is nobody knows but play the averages. i tend it look at what happens to the s&p, year over year, with the dividend that's total return. right now, in the last 90 years, the s&p 500 has been up over 72% of the time. you include the dividend, it has been down 28% of the time. next thursday, this coming thursday, we talk about the long-term averages and how the stock market work and very long cycles bottom line is, stick with the markets, they tend to be up year over year. back to you. >> okay, thank you, bob. time to head to the bond picks check in with rick santelli at the cme group in chicago. rick >> good morning and thank you. happy holidays, merry christmas to all viewers and listeners

when i look up at treasuries, we're closing the year out on the low end of what many analysts and economists and armchair technicians thought with regard to all maturities. if you look at intraday of 10, it is climbing a bit zoom into a two-day, 194 today yesterday a little bit lower, we have taken out the high, zoom it back for an entire week. you can see we have been here before, we always seem to stop right around 195 but volume is thin holiday markets early closures over the next several sessions, many think that we could go through, we could slice through that level might have not have long-term implications though and that is the point. another big issue is bob was discussing how things have changed. all these yield curve spreads that went along with an in part fueled the recession talk were misguided. we spent some time in negative territory, but not much. and many of us continue to

monitor 10s minus 2s 30 basis point separation last week and that was the widest in 13 months. but we have seen on those charts that the long end is kind of stuck. but the short maturities not so much look at the this year to date chart of 5 year minus 2 year, it widen out to 10 basis points all the spaces in the short maturity and along the curve continue to open up. carl, back to you. >> rick, thank you very much rick santelli. for more on today's movers, to bertha coombs. >> another day, another record for the nasdaq apple helping contributing to that but the stock of the year really has been a man has been amd it is the biggest gainer and saw this huge turn around from a year ago, a year ago going into christmas eve, down four straight days, losing 14.5%. look at the big turn around. we have seen a big turn around in chips as the sentiment turned

around on trade. the big comeback is healthcare, biotech. biotech last year down nine straight days going into that december 24th low. it was down two straight quarters coming into here, the end of the year. it made a really nice bounceback and when you take a look at some of the newest listings here in the nasdaq, the best performers are all biotechs beyond meat is the next one, up 200% for the year. over to you guys. >> all right, thanks, bertha rbc takes their amd target to 53 the title of the report is in lisa su we trust best s&p of the year. >> i feel like we know somebody else who likes lisa su his name is jim. he doesn't look like you >> make sure to check out our podcast, listen to the opening bell hour, "squawk on the street," wherever you listen to podcasts, best podcast in the world. we're back in a moment dow is down 29 this is a historic moment.

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expect in the new year phil lebeau has the 2020 playbook for the automobile sector ♪ >> next year is a huge one for tesla and its investors. as model wide deliveries begin it could rack up big sales for two reasons. first, crossover utility vehicles are in demand second, tesla will build the model "y" at its plant in china and china is the world's largest market for electric vehicles meanwhile, you can tap the brakes expecting much from self-driving cars next year. yes, companies like wee mo and cruise are making progress when it comes to autonomous vehicles but the technology still has a ways to go bottom line, you won't see a lot of autonomous vehicles on the road in 2020 what you should see next year are strong truck and suv sales americans are still buying these bigger models at a near record pace yes, they are paying for more

those vehicles and that is expected to continue but as long as unemployment remains low and consumer confidence remains high, there will be plenty of demand for trucks, suvs and crossovers, which now account for two-thirds of the new vehicles sold in the u.s. >> global auto market has had its challenges and even in the u.s. auto sales have been strong but haven't grown in the last four or five years >> well, you know, we've seen now quite a few years in very high sales it is a cyclical business. i think in a waywhat's more surprising it hasn't tapered off more than it has you know, a year ago the fears of investors certainly was that the sales had peaked and we're seeing a declining sales period and a tough time fort automakers here's where the think the high employment kicks in. if you haven't had a paycheck and suddenly get one, what's one of the first things you want to do if you have a car that's past

its sell by date you want to get a new car. it's one of the most basic things you will invest in. that has helped prop things you. >> interesting story in the journal worth a read about americans overall driving less the numbers are coming down. >> that's interesting. >> moving to cities and all of that it's true. as we go to break look at some blue chips finishing the year with strong momentum unh and apple leading the quarter. s&p is down almost 3 , and i approve this message. climate is the number one priority. i would declare a state of emergency on day one. congress has never passed an important climate bill, ever. this is a problem which continues to get worse. i've spent a decade fighting and beating oil companies, stopping pipelines, stopping fossil fuel plants, ensuring clean energy across the country. how are we going to pull this country together? we take on the biggest challenge in history, we save the world and we do it together.

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if you missed news the morning, uber says traviscalan nick will resign december 31 to focus on his businesses and philanthropic endeavors. nice quote saying very few entrepreneurs have built something as profound as he did with uber, he's liquidated his shares in uber, having sold $2.5 billion in the past several quarters we'll see what this means in terms of uber forward and travis himself. >> we were chatting earlier is this a vote of confidence in

uber i don't know that you can say that i don't know that says taking he doesn't believe in the future of the company either that would be hard to believe. i do think it's just part of this essential transition from the upstart innovator to the more established company uber has become a big part of the status quo in the cities now. >> it's great having you, jim, thanks. >> nice to be here. >> merry christmas. >> merry christmas to you and everybody watching the stock market has helped make the merry. >> that's for sure jim stewart. when we come back more on uber and we will talk to blacktone's byron wien 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,

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♪ it's that time of year ♪ christmas time is here >> good tuesday morning. welcome back to "squawk on the street." i'm carl quintanilla with david faber, julia boorstin in for sara eisen, live at post nine of the new york stock exchange. quite a bit of news for a christmas eve, especially for a holiday shortened session. we're going to look at uber, tesla, boeing and a lot more as the nasdaq is going for ten straight wins. one of a handful of streaks like

that so far this decade. >> let's goat our road map this morning. it does start with travis kalanick he's calling it quits when it comes to uber. the co-founder of the company leaves its board of directors. we're going to discuss what it means for the company. >> plus, legendary investor b byron wien will join us. >> and the holiday shipping wars a record number of packages expected to be delivered this holiday season with fedex, amazon and ups battling it out >> we begin with the markets retreating a bit after a higher open with the nasdaq hitting a new record high. president trump speaking on a video conference call with troops in the last half hour, here's what he said about the china trade deal >> we'll probably do it. we'll be doing a smaller ceremony ultimately we will be having one. the china deal we will be having a ceremony, yes. >> will you sign it, you and xi jinping? >> we will ultimately, yes, we

will when we get together we'll have a quicker signing because we want to get it done the deal is done it's being framed right now. okay thank you. >> for more on trade in the markets let's bring in kevin, senior portfolio manager at washington cross advisors and kenny, senior market strategist at slate stone wealth. kevin, reflecting on what president just said and your outlook for the sort of corporate performance next year, what's your expectation of trade deals and how trade could weigh on the markets >> well, the market and the economy really needs this because we've had a very good year this year in the stoemts, but a lot has been driven by liquidity and central bank action in order to get a good year to follow 2019, we really need to see the data that was starting to turn up some better numbers on manufacturing, better numbers on business expectations

we need to see that follow through. and trade is a really important factor that's driving business confidence ultimately investment and earnings, so hopefully we do get something and see know reason why we can't. that could create a very good start at least to 2020 >> kenny, do you agree i understand you think we'll see the market pull back a bit in the first quarter of 2020? >> i do. listen, overall, broadly i agree with kevin and i think he's right. trade is very important and it's going to be important into 2020. but i wouldn't be surprised if in the first month, january, february, you actually do see the market pull back we've had some major moves in the market the s&p and, you know, nasdaq up 35, 38%, whatever it is. the s&p at 30% there may be a lot of planning as we hit in january people that maybe want to take some money off the table, but didn't want to take it off in december and know the taxes four months later in april. if they take it off in january they don't owe those until april of 2021. there may be some of that.

i wouldn't get up in arms about it or worried about it that would be normal financial planning and tax planning. i do see that would be the weakness into january, not a slower economy or not a trade issue or talk of recession at all. i think it's much more going to be a technical kind of rebalancing, that's all. then the market actually i'm bullish on where the market is on the u.s. economy and now ta we've got, you know, trade 1.0 basically done, we're on to trade 2.0. that's going to be the next driver on top of everything else that's going on in terms of the presidential election. >> yeah kevin, are you more interested in seeing how a phase one text sort of ratifies the market's view of the detente or are you looking for q4 conference calls to ratify what we've seen in terms of multiple expansion? >> well, both, really. it's ultimately going to be investment spending we need to see pick up because that feeds

nicely too earnings growth which has been the thing that's been absent from the party this year. in fact, there's a dichotomy here because growth for the year slowed we know the imf coming into the year was looking for 3.7% global growth it's really looking more like 3% growth the united states is the only g7 country growing something above 2% the rest seem to be growing below 2% we're at an inflection point where the market has given us a big gift this year with the significant moves in terms of the upside, but we need to see follow through in terms of growth and growth in earnings expectations if we don't get that we could hit some headwinds next year thankfully the data seems to be turning, seems to be getting better, and whether you're talking abouts u.s./china trade or brexit, which is better defined now, there seems to be a little more confidence as we head into the year at least it's not the worst outcome which would have been a breakdown in trade conversations or something more significant

breaking down in terms of global growth we're happy to see the progress that we've been making the last few weeks. >> so kevin, what gives you the most concern, if anything, heading into next year >> i think it just has to be the duration of thecycle we've had a very long cycle here, a lot has been underwritten by very, very low interest rates look around the world, you've never had a phenomenon like we had today between 10 and $20 trillion of negative yielding debt out there that's very strange. never before in human history have we had that and when you have very long periods of very low interest rates, oftentimes you can end up with expectations that get priced into assets that are hard to be met. so if you get to a point where the credit cycle globally rolls over, yes, we would go through a more difficult period, be maybe a recession. there's nothing in the immediate data that seems to be pointing to that. that is obviously something that would -- that we're aware of and we need to be watchful of as we move through the next several

quarters >> now, kenny, you mentioned expectations of some near term profit taking but what are the macros issues that you're watching that could pose the biggest risks? on the flip side where are the areas you think provide the opportunity in terms of sectors or international markets >> so i think it's going to be about trade and the presidential election certainly for us in the u.s., right. about trade 2.0. and then i think up until super tuesday there's going to continue to be this question about who is really going to rise to the top and then what's the platform going to look like and is the democratic party going to go more far left or is it going to come to the center that's going to define kind of how asset managers set themselves up in terms of, you know, what sector is going to be most effective if they go far left and we were fearing with liz warren or bernie sanders you had to worry about health care, pharmaceuticals, big tech, the financials, right, but if we see

them coming more to the center i think a lot of that pressure gets taken off you can see it in the way health care alone has performed since she started to go down in the polls a little bit, health care has taken off because people are starting to reevaluate next year i like energy. say what you want. i like the big names i think there's a lot of opportunity. you can start to see it raising its head oil up 12 to 15% so far. the big oil names, exxon, chevron, will start to play catch-up i'm big on that space and i like it and i think it's exciting i also think once we get past super tuesday, again you see more of what the platform will look like, you have to be in financials you have to love tech because 5g is coming to change the world again in 2020. there's going to be a whole other revolution in tech anything that's 5g related in that space is going to be certainly hot. and the cyber security space, things like the hack etf or palo

alto or cisco, anything to do with cyber security because once again i think we're still on the cusp of what could potentially happen in terms of security risks. there's a big opportunity in those cyber security type names. >> kevin, kenny, thank you both so much for joining us this morning. >> thanks. >> merry christmas. >> same to you guys. >> $41 billion in five year notes up for auction santelli is in chicago good morning again. >> good morning. before i even talk about the auction look at the landscape quickly. yields are up against resistance to the upside. what makes yields go up, price going down treasuries have had selling pressure another issue. it's real thin markets today, right, yes well the latter has nothing to do with with the auction as carl said, $41 billion will move no matter how many people are here. i gave this auction an a-minus 41 bill five-year notes on a half session and they just gobbled it up.

mainly for the reason i gave first. because they look at where the market is, thin markets, they think this is going to be a great buy and the price is going to reverse when we start to put more people into the equation. quickly, the yield was 1.756 the one issue market was deb set didn't trade at all, right around 177.5 lower yield, higher price, 2.49 bid to cover that's the second best bid to cover going back to july of 2018 62.4 is the indirect that's the second best since august of 2018 and finally direct 16.1, well, it's the best since june of this year no matter how you slice it the five-years flew off the shelves. >> thanks. still to come, travis kalanick calling it quitses the co-founder leaving the board of directors at uber what it means for the stock which is down more than 30% for the year later on, do not miss wall street legend byron wien on the

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uber's co-founder travis kalanick leaving the board of directors at the end of the year josh helped us break that story and joining us with the latest hey. >> that's right. travis kalanick will focus on his new business and philanthropic endeavors saying uber has been part of my life for the past ten years and at the close of the decade and with

the company public it seems like the right moment for me to focus on my current business and philanthropic pursuits he was ousted from uber in 2017 amid a series of scandals, but he remained on uber's board. this coming as kalanick had been systemically selling out of his position in that company, having sold about 90% of his stake and more than $2.5 billion of the shares that stock now about 30% below its ipo price of $45 so what is next for kalanick he's already busy with other pursuits for example, launching his latest venture called cloudkitchens which rents out space to restaurants in a statement uber ceo dara khosrowshahi saying he was grateful for kalanick for building this company. >> joining us with his take on the shakeup, former medtronic

chairman and cnbc distributor bill george. good to have you back. >> good morning, carl. >> how common is it for a co-founder to completely leave a company and not leave one foot in the door, whether on the board or with a stake? >> well, i think it's about time in this case and i think he should have left two years ago travis is a brilliant entrepreneur, he had a great app but somebody has to run the stage. at different times and stages you need a different leader. i think this is timely they've had a lot of cultural problems in addition to using investor capital to fund the losses on underpricing taxis so now they have to get back to a normalized business model and out of the high rate of losses still running on an ebitda bases of $2.5 billion a year. >> you think his presence or the board or presence as a stakeholder was a distraction for management >> no doubt about it i think dara has to have free

rein to run the company. he has to change everything. the culture, the leadership team, maybe the business model and to get it more to eventually a profit model they did that at amazon. i think they have to do it here. i'm not saying can't be done it's a great app i use it all the time. it's time to move on >> bill, it's interesting looking at sort of the timing of this he's getting out of his stake in uber just as we have boeing ceo pushed out and this year we've really seen a record number of ceos leave their posts, some fired for misconduct, others are founder ceos who are leaving among -- amidst the idea maybe they're not the right people to be running the company anymore how much do you think this is about a cultural shift, boards holding their ceos to higher standards? >> i think there's no doubt about it, julia. boards are under a lot of pressure these days, particularly from outside groups, regulators, government, media, politicians, so i think

they have to -- the ceo has to perform. if you have any kind of deviation from corporate standards as we saw at mcdonald with steve easterbrook, the board has to move. if it's created a culture like mark parker at nike, i think it's got to happen or if the profits aren't there, you can't solve the problem. i think it's very -- it's inevitable that boeing was going to make a change and boeing is lucky to have dave calhoun to step in and to lead the company. he's a very experienced aerospace guy and aviation guy i think he can do that at boeing i think you will see more changes coming up. the time frame for ceos to perform is very short, particularly earlier in their tenure >> yeah. well you went to boeing where we were headed, so, you know, i'm curious, do you think the board also needs to be shaken up at all when it comes to boeing beyond just the executive suite, bill >> i think they have an outstanding board, david

i'm not worried about the board. i think they needed to give dennis a shot and he just -- the problem with boeing is they didn't move quickly when they had the crisis they wait too long and should have done it in october when they had the first stretch and then in march before they came public and there was a lot of blaming and they should have moved faster i think dave calhoun will restore the confidence externally and that's what has to be done to give them time to get the max back into the air. >> is it enough to just replace the ceo? do you think that sort of is what they need to do and they can move on from here? >> well, they already have replaced the head of commercial aviation i think dennis did that and that should be done remember back when alan mulally was head, they need that strong person change in the board is not going to change any. this board is not complacentp. they have a lot of strong

directors that have been through crises like this before and they gave dennis a shot the external pressures made it inevitable but they're fortunate to have calhoun there. look at wells fargo, david they took six months to go find a ceo and it will take them another three or four months to get up to speed. they lost almost a year. boeing, calhoun can move in. he was making phone calls the other day to everyone in washington trying to restore that confidence and give the company time to get it up in the air and not frankly be over confident. >> now, in retrospect with a change in leadership inevitable, should boeing have made this change earlier or do you think that muilenburg deserved a shot at handling it better than he ultimately did >> i think the ceo deserves a shot i'm not quick on the trigger you have to give him a shot. ceos get under pressure from time to time to see if they can. all i'm saying today's world is different. it's the external pressures are so great and they mount up on you and that's when you have to

move we've seen this in case of other crises that's when the board has to step up and make the change. >> finally, bill, i'm looking at the list of exits of notable ceos, muilenburg and oscar munoz are recent art peck at gap, easterbrook, tim slone, kevin burns, mark parker, adam neumann, what's going on at boards and why is the leash shorter and is it going to stay that way >> i think there's no one cause that's causing this, but i do think boards have to recognize when they have a problem by the way, when it's a code of conduct problem, it's almost instantaneous as it was at intel, as it was at mcdonald's when it's a cultural problem it takes longer for the board to figure it out like it did at nike they're fortunate to have john up there to replace mark parker. they're fortunate to have that when it's a performance problem is it a short term or do you have deeper, long-term problems if i think the boards give --

need to give their ceos a chance to get the company on track and not be too quick on the trigger, but on the other hand they can't wait too lock. you're seeing boards being much more active than they were a decade ago i think that's a good thing. i think boards are taking their jobs very seriously today and making the moves they need to make to get the companies on track. i'm not at all negative about this i realize being a ceo it's tougher than when i was ceo 15 years ago. >> it's going to be something to watch. definitely have been complaints about the dynamic being the inverse of what we've seen this year bill, merry christmas, good to see you. >> same to you thank you very much. >> bill george quick clarification from me on something i said last hour, i had said that i would be not here next year when i meant next week thank you for all the outpouring on twitter for the texts as well i will be here next year

i will be here for our next block of programming as well when we come back, it is the worst sector of the year, but our next guest thinks some names in the energy sector are poised for a rebound in 2020. we're going to explain next when "squawk on the street" returns ♪ ♪

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energy is this year's worst performing sector in the s&p and the only sector which doesn't have double-digit gains for the year but our next guest says he sees a buying opportunity in this industry and he's here to share some of the names he thinks will do well joining us is portfolio manager wynn murray. why energy in 2020 >> well, you know, i got to start with a caveat, you never wake up in the morning wishing you have a chance to buy an energy company, you know at oak mark we're comparing all stocks against each other and not just looking at a particular sector we're comparing apache to microsoft to merck energy has been a significant laggard and more importantly a

huge amount of underinvestment from a supply perspective. the price of oil is up 100% since 2016 the energy indices are down since then we're basically seeing the market give us these companies at a discount to the run up value of their existing fields. >> and so within the industry then, what attracts you the most in terms of the theme you just set out? >> well, so this is an industry that has a history of bad capital allocation so one of the first things given our holding period is four to seven years, the way these companies deploy their cash flows is really important to the investment thesis so we have to find management teams and boards of directors that think like portfolio managers it's harder in this industry than in a number of industries so that's the first criteria and, you know, it's a disqualifier if they don't we're looking for companies with oil exposure we think that's the part of the market that's likely to inflect.

we think the clearing price of oil is going to prove to be higher than it currently is. there's companies with a lot of leverage to that. >> so with energy stocks coming off, you know, 2019 where they were among the worst performers this year, what are some of the individual names you're focusing on for 2020 in particular? >> so some of the stocks we like include diamondback, apache, eog. these are companies run by excellent ceos they' they're essentially growing their oil production double digits with the stocks having a mid-single digit cash flow yield right now, despite below normal oil prices even if oil prices stayed flat, these companies would probably produce double digit shareholder returns. we think the amount of supply that's come out of the industry, the rig counts declining the way they have, the complete collapse in offshore will lead to an

environment where the price of oil is actually, you know, $10 or so higher and they have a lot of leverage to that in their income statements. >> win, the journal did a piece this week about shale and banks tightening their credit lines, quoted some people thinking they might cut revolvers by 10%, largely affecting the smaller players. do you buy that? >> yeah. i mean that's the part of the cycle that we're in, and if you look at -- i mean you guys know how investing works. if you look at every investor who has had a successful 40-year career they frequently deploy capital into industries where the capital markets have closed to them. right now, we think that if you can find oil and gas companies with good management teams and balance sheets that will ensure survivability through potentially a prolonged downturn, because we don't know when the timing is going to be on this turn, you're getting paid pretty han somely in terms of discount to value right now.

>> you talked about oil not being at a normal price. why isn't this a normal price? i heard your belief you think this will go up, is this just a play on your belief that oil prices will cease by 10 bucks? >> we think at the current stock prices the companies we invest in, essentially could run off their existing reserves without growth cap x and we would end up doing fine the increase in oil price would provide a lot of upside to our valuations you know, the last quarter showed an increase in demand for oil by about 1.2 billion barrels a day, at the same time the reserve index is at its lowest levels in 20 years when capital stops being deployed to it it looks bad for a while but suddenly the incremental barrel is demanded

by the market and the price goes to the cost to get that out of the ground >> right you don't think the permian production will increase from here in 2020 >> you know, the technology there has been amazing the production growth has been phenomenal it's been one reason why this has been a terrible sector but if you look at the decline rates of these wells and you look at the amount of capital that's required to maintain production at these levels and you look at what you guys said about how capital is getting cut off from this industry, it's difficult to see how you get the type of step function increase in supply that you have seen the past couple years. >> win, thank you. appreciate your time and happy holidays >> yeah, you guys too. glad you're back next year >> thank you we're all relieved it's the best christmas ever. >> yeah. i didn't know anybody actually cared. my own mother was like, you're

leaving? >> it's time for our etf spotlight with less than 24 hours until christmas a look at the spider etf ticker xrt trading up about half a percent. the group recovering over 18% from last year's christmas eve lows still, some of the market's weakest performing name since the december bottom retail macy's more than 42%, including others like gap, l brands, kohl's and tapestry. >> let's get a news update hi. >> good morning. here's what's happening at this hour pro-democracy protesters clashing with police at a busy hong kong shopping center. some of the officers were seen hitting people with baton's as others pushed bystanders back and they dispersed tear gas. sumatra, a bus plunged into a ravine after the brakes malfunctioned. 28 people were killed. 13 injured the ravine is 262 feet deep.

officials say the bush crashed into -- bus crashed into a river forces capturing a stronghold amid missiles that struck a school they took refuge in >> prince philip has left a london hospital where he spent the last four nights the husband of queen elizabeth did leave on foot and entered a waiting vehicle. he will join the rest of the royal family for christmas at sandringham house in england that is our news update at this hour back to you, julia >> thanks. when we come back, the s&p is on face for its best year since 2013 only week left of trading. blackstone's byron wien will quk t see rur record run when "sawonhetrt"etns every trip... there's room for more than just the business you came for. ♪

whether that's keeping up with what you always do... ♪ ...or training for something you've never done before. (crowd cheering) that's room for possibility. ♪

♪

perhaps the record highs for stocks aren't high enough. our next guest says the market is still below fair value and central banks has fueled stocks upward momentum. byron is vice chairman of blackstone and joins us to help close out the last couple weeks of 2019. welcome back. >> always good to be here, carl. >> you were with us just after thanksgiving or maybe before and you did say the whole move of the market since '08 is the result of monetary easing. you thought 2020 would have the economy running above trend once again. talk about what you see for the next 12 months >> for the next 12 months i think the market is in pretty good shape it is not overvalued at these

interest rates so i think it still has room to go higher. >> the journal argues the new normal maybe 19 times, 19.5 times is the new normal. what do you think that number should be? >> well, i think the market canal sell at 20 times remember, you know, stocks are related to interest rates and they compete with bonds, and with rates below 2%, 20 multiple can certainly be supported >> rates seem to be the most important thing. i don't want to put words in your mouth, but i've been listening to you for a long time am i right >> yeah. interest rates are key i mean the geopolitical background is important too, but even that has been cleared up. we now have a phase one deal for china, brexit has been resolved or looks like it's going to be

resolved, so, you know, some of the clouds that were hanging over the market are no longer there, or at least they're not as sense as they were before >> so if you're reassured about a china trade deal what are some of the biggest risks you see facing the market next year? >> well, we could have a rise in inflation that would drive interest rates up and would drive multiples down it would create risk in the market we could have an election outcome in the market that would affect the market negatively, having one of the more progressive candidates get the nomination and actually win. right now, i don't see any severe thunderstorms afflicting the market in 2020

>> byron, i always ask you this and try to characterize your concerns about deficits and the debt you got an economy growing at 2, and debt growing at 5. it's not a u.s. phenomenon, it's a global phenomenon. greenspan said given deficits inflation will inevitably rise and he has had the stagflation thesis for a while when do you get concerned? >> nobody knows what that point is one thing i said, i think i've said on the program, carl, is in the year 2000, the cume lated debt of the united states was $6 trillion and the blended interest rate was 6% so the debt service was 360. now the debt is 22 trillion, the blended interest rate is a little over 2, the debt service is 450, so the debt is almost quadrupled and the debt service

has only gone up 25% that can't go on forever so eventually interest rates will rise and that will create serious problems for the market. but i don't think that's a problem for the next year. >> byron, that's great stat and i remembered it from the last time when you said it. only $90 billion increase in our interest cost. what makes me think we can't have interest rates go up. it's simply not a sustainable thing in any way for the u.s. budget for rates to go appreciably higher because we'll be sunk in terms of interest payments and how much of the budget that takes up >> well, i want you to get a good night's sleep on christmas eve, carl, so let me take -- >> that was david. >> oh. i'm sorry. i didn't realize that. so the point is that there's so much liquidity out there, you

know, in 2008 the central banks had about 3 trillion on their balance sheets and now they have over 16 trillion there's a lot of liquidity looking for a place to hide. that liquidity keeps interest rates down so i don't think this is a clear and present danger i think rates will stay low during 2020, but you're right to be concerned at some point out there, rates are going to rise and the -- both the bond market and the stock market are going to have a tough time with that >> byron, we've been looking through your predictions for 2019, most of them turned out to be very accurate one of them was that growth stocks would continue to provide leadership with technology and biotech doing well we saw tech stocks have a banner year i know you don't officially give your predictions until january, but can you give a hint about some of those sectors, particularly tech after such

significant gains this year? >> well, julia, i've always been a growth stock investor. i'm a believer in it i don't think earnings for the s&p are going to be up a lot next year. maybe 5% and if that's the case, if you can find a growth stock with earnings up 15 to 25%, at a reasonable multiple, i think that's attractive. >> byron, politics, you know, come january we're going to be focusing on des moines and new hampshire. it feels like the market always does a little too much hand wringing relative to the actual threat of policy, given all the things that would have to go right for things to be implemented after november how do you think that's going to feel say come super tuesday? >> well, look, you know, donald trump is going to be in a trial

relative to his impeachment. i don't think he will be convicted. he will be the candidate for the republican party i don't know who the candidate will be for the democrats will be right now i have to say trump will be re-elected because i don't see a democratic candidate who can beat him and so that means more of the same for the market. the market is assuming there isn't going to be a serious political change in the united states and that's why it is continuing to rise >> certainly explains a lot of the action over the last several weeks. byron, our best to you and your family it's always such a pleasure. we look forward to a lot more in 2020 >> okay. carl, one point i would make,

russia gii can't give you any surprises but i can tell you one i didn't use because i used something like it last year and i don't do it two years in a row watch gold in 2020 it has a chance to be an interesting investment >> highest level today, since november, at 1500, byron we're going to remember that tip. thanks we'll sea you later. >> okay. bye. >> all right call that a tease. and by the way, speaking of teases, as we go to break there's a look at the top stocks on the nasdaq 100. the overall index hit a new record high today. we have a lot more "squawk on the street" after this 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

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to help the blind. it is already working in cities like tokyo. my dream is to help millions more people like me. welcome back over to the cme group in chicago and rick santelli with the santelli exchange. >> thank you, julia. i would like to welcome my guest

peter, academy securities. thank you for joining me on this christmas eve. i remember one of our first interviews in 2019, you talked about corporations going on a debt diet. what did you mean and how do you think it turned out? >> i think it turned out extremely well what i meant was a lot of the weaker triple b companies would focus on reducing their leverage, cleaning up their balance sheet and we saw company after company do that, whether budweiser, at&t, verizon, rubber made, kroger, and the list goes on, and your much improved credit situation for the companies which has benefited the stock market as well. >> all right now we've looked at the side of the issuers, now let's look at the side of the investors that like to buy the securities that they are issuing to clean up and deleverage and do it at lower rates. we've seen big supply, record year, we're probably showing the barclay credit spreads

investment grade or high yield, they keep narrowing on the investment grade, it's now under 100. although, on high yield, even though the spreads have collapsed which is a good thing, on the 20th of this month moody's said they're nervous they warned of a frothy u.s. junk market. weigh in. >> yes i think first it's been a great year and the more risk you took, the more you were rewarded i think you want to be cautious here on the high yield side. one thing i've seen over the past month, short squeeze. some of the weaker triple c credits, the bottom end of the credit spectrum, i think they rallied based on short squeeze positioning so i think you want to be careful in high yield, in leverage loans right now i almost prefer the leverage loan market to the high yield market i would be taking profits and reducing exposure to high yield right now. >> how much do central banks generically have to do with this global appetite, this insatiable

appetite for investors it's like they have a sweet tooth and anything corporate is a big piece of chocolate does anything worry you here that we could have any quick changesne changes on the sentiment side. >> i think they've been supportive of the market credit tightening in market because we initiated qe. american companies issue into that and the u.s. you really saw three turning points in markets here, three periods where we were a little bit weak and we bounced. first in december and january of last year where the fed really said hey no more cuts, sorry no more hikes then started doing the insurance cuts back in may and june and then started regrowing the balance sheet in september and october. i think the fed will not be able to be supportive of the markets, i don't think we get any more cuts and talk about the maximum size of the balance sheet. you want to be a little bit cautious and take profits here it's been a great year, it's

going to be tougher this year going forward. >> peter, great to hear from you, especially considering how well you've called this market happy holidays, merry christmas, happy new year to you and your family carl, back to you. >> you too, thanks a lot, rick. >> all right at the top of the hour, top of is day before christmas which means it is time for the traditional singing of wait 'til the sun shines nelly the traders are getting ready to perform on the floor that's coming up on "squawk on that's coming up on "squawk on the street." because hey, tomorrow's coming up fast. nature's bounty. because you're better off healthy.

the spach&p 500 waiting for gains. cyclical groups like industrials and health care are dragging us lower, then let's drill down on one of the outperforming sectors, real estate that group on pace for the fourth day of gains in the last five tracking for the best year since 2014 that's been boosted by falling interest rates one of the reasons investors like the space, dividend yield at 3.4%, nearly double the ten year yield some of the names higher,

vornado, simon property group, cbre trading at all-time highs back to you guys julia? >> thanks, rahel. 'tis the season for shipping holiday e-commerce on pace to shatter records. as they shift to online shopping, on time delivery is more important than ever where do shippers stack up on the naughty or nice list frank holland has a report card on shipping wars. >> with a 99.8% on time delivery rate, u.p.s. was the best of the major shippers last week that was the final full week before christmas and hanukkah. amazon, u.p.s., fedex, post office separated by a few tenths of a percent anything over 95% is good. talking holiday packages every tenth of a% below 100 percy kw100% is 86 thoirks packages that didn't

arrive on time for the holiday season, new data shows deliveries exceed 2.5 billion packages between black friday and new year's eve. that's a record amount, done in 33 days. shortest period of time possible between thanksgiving and christmas. for the full holiday peak, u.p.s. leads for on time delivery some of the holiday volume includes returns, including growing category of returns of items that people bought gifts for themselves during holiday sales, returns are expected to increase by $5 billion for the third consecutive year, putting additional pressure on all of the networks yesterday was the deadline to send a package, make it in time for christmas for all shippers except for amazon. the tech giant offering free same day shipping tonight for orders over $35 in 42 cities, as long as they're placed by 9:30 a.m. local time. when we come back, we have more on what travis kalanick leaving the uber board means for

the future of the company. a muted range day before christmas as we have a shortened session. stocks close at 1:00 dow down 120 "squawk alley" starts in a moment - at southern new hampshire university,

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good morning it is 8:00 a.m. at uber headquarters in san francisco, 11:00 a.m. on wall street, and "squawk alley" is live >> reporter: ♪ ♪

good tuesday morning welcome to "squawk alley." i am carl quintanilla, post nine with david faber, with julia boorstin jon and morgan have the morning off. let's send it over to bob pisani, art catshi cashin. >> 1860s, start of continuous training, there was a tradition of singing raucous carols on the floor of the new york stock exchange the song has a little more sentimental, but one that survived all of them here in the 55th year on the floor of the new york stock exchange, art cashin leading "wait 'til the sun shines nelly. ♪ wait 'til the sun shines,