important deals in trade ever. very porn deal, and i guess you can say one of the most important deals in trade ever. very porn deal, and i guess you can say one of the most important deals in trade ever. aa very porn deal, and i guess you can say one of the most important deals in trade ever. rf a very porn deal, and i guess you can say one of the most important deals in trade ever. ef a very porn deal, and i guess you can say one of the most important deals in trade ever. >> no one's ever done this before we never had a u.s. trade deal of anything like this. >> we just achieved a breakthrough on the trade deal, and we will be shining it very shortly. >> this kind of deal and this kind of cooperation did not seem possible two years ago >> on january 15th, residing monster, a big, beautiful monster. it's wednesday morning, welcome to "squawk alley." i'm carl quintanilla at the new york stock exchange. the president is set to sign an historic deal with china in a few minutes. we will bring it to you live when it begins in the meantime we have every angle covered at the end of that event. yunus yun has reaction bob pa santi will join us on what we see in the stock market

and eamon javers has the latest from the white house good morning. >> good morning, carl. the exact details are under wraps until after the president signs this deal but officials are talking throughout the morning in general terms about what's in here treasury secretary steven mnuchin earlier today this isn't about ag purchases which have gotten so much attention but the fundamental way chinese companies behave in the global economy. here's what he said -- >> we need to put together very significant laws to change rules and regulations and made very strong commitments to our companies there will not be forced technology going forward. i think that's a very big win for our technology companies, for our businesses and for our american workers. >> larry kudlow on cnbc earlier today. the national comic council director suggesting also there are big manufacturing, energy

and services, purchases in this agreement in addition to the ag numbers that a lot of people have been talking about going forward. the devil, of course, is in the details of all of this we will see the tax at some point this afternoon, administration officials promised i can tell you, there's intense choreography going on at the white house for the rollout of this, which will be in the east room later on today. very detailed preparations they did a walk-through with the chinese side the protocol, who speaks, what order, who is standing where all of that carefully walked through yesterday. we're told white house officials are pleased about how that went and are optimistic today. >> yes, i think 200 people standing room only will be a busy afternoon going through the 86-page report and all of the details eamon javers, thank you very much let's get over to eunice yoon but let me know we hit highs across the board

we go to yunus now for the insights in china. >> thank you very much they are saying this deal is good not only for the u.s. and china but also the world and it also quoted the vice premier saying the deal was based on mutual respect and equality. that last point is important because it ends up fulfilling one of beijing's demands and helped beijing market this deal back home to its people. today the state media has been quoting a customs official who is saying that really helping to prepare the public for this idea that the chinese are going to buy more from the united states. the quoted official said that buying u.s. imports wouldn't hurt purchases from other trading partners now people both in and out of the government have been telling me today that the chinese do actually have problems with this

deal there is bag concern that china isn't going to be able to reach some of these purchased targets. some had described this to me as unattainable there's also concerns about the purchase targets that at the end of the day can end up setting theses up for a conflict with the u.s. or some of its other trading partners finally, there's a little confidence just as americans are maybe suspicious of the chinese sticking to its word the chinese are very suspicious of the trump administration and in particular president trump, for sticking by his word especially with the election coming up in november and what appears to be some trouble within the u.s. economy. so because of that, my main takeaway from my conversations today was that there are a lot of people who think this truce is fragile and there's some concern that this is more a way to play for time, and that the phase two isn't going to be

within china's interest. in fact, just a couple of hours ago, the global time the communist party paper had quoted an unnamed source saying the phase two trade talks may not start any time soon. guys >> i'm curious, they have been focused what the tariff situation is in the u.s., tariff levels on imports here from china. but what is the rhetoric, what is the expectation around the tariff that the chinese have put on american imports there? >> there hasn't been a whole lot of discussion about the tariffs that the chinese have imposed on american goods because from the chinese perspective, that's seen as a countermove, that the u.s. is the one who initiated this trade war and the chinese are just reacting to it right now the focus mainly is about this trade deal and the hope that this could at least ease the tensions somewhat,

although just from the narrative from the state media, most people don't believe it's actually going to ease the fundamental problem between the u.s. and china >> eamon, eunics, stick around we have the former nbc deputy director and former director of pr from china. thank you both very much for the time you heard the deal is transactional, pull of promises. tariffs remain in place. you think it's more substantive than that? >> absolutely. i think people will be excited when they see the text of this agreement. it is a lot more detailed and covers a lot more topics than most people are talking about right now. let me just give you a couple examples you start with forced technology transfer, which really was what started this whole dispute in the first place and three of the four issues that were

articulated in the 301 report are covered in this agreement and china said they will stop doing it and it's enforceable. and then the two highlights for me, trade secrets, something our countries had concerns about for a long time. something the president actually talked about at the u.n. general assembly whether he talked about micron and the effect of their trade secrets. now china will put in place a modern regime to protect that, including penalties. there's also a lot on pharmaceuticals and patents, which is really important for that industry, especially after losing ground in the end game on usmca. then financial services, you heard a lot of talk about the removal of the equity cap but really more significant are the provisions in there on licensing so once those equity caps go away, china will have to grant licenses to u.s. companies that apply on a nondiscriminatory basis. on agriculture, we can talk

about the sales, purchases over the next two years and that's good, but this is a fully fledged agriculture chapter like you would see in a trade agreement. it really gets into a lot of details in terms of china having to adhere to science-based standards, having to conduct biotechnology approvals, things like that. they will help u.s. soybeans and corn and beef pork and i can go on i think this is a good deal not only for the u.s. but china. i agree, i think it will help both of our economies moving forward. still work to do but this is a really good first step. >> jeff moon, larry kudlow really worked to frame this phase one as a big deal. it seems like clete agrees but in the meantime the details are yet to come. perhaps coming in phase two. we heard our eunice yoon saying phase two seems to be on shakier

ground in terms of how it pans out from the u.s. perspective. is this a big deal >> i think we have to be careful not to see the forest through the trees here we have tariffs on billions of dollars of tariffs on chinese imports with the promise to resolve that and he has failed we need to recognize that. china already proposed since the beginning of the trade war to write a few checks, make some big purchases and call it a day. basically they succeeded the issue we're discussing other than the purchases, frankly, were all on the table at the end of the obama administration and were discussed in the context of the bilateral investment treaty that was 90% completed the issues we were talking about in that respect represent incremental progress, not revolutionary progress we really need to read this agreement closely and what china does

with regard to forced technology transfer, for example, china passed an investment law that came into effect two weeks ago and china claims the ban on forced technology transfer resolves america's concerns. if you look at the text and look at the implementing regulations, you will see a ban but no details on proceedings to punish violators or whether there are any penalties or not that's basically nonenforceable. as for licenses, i think the american credit card industry can teach us how licenses work in china in 2012 the world trade organization found china unfairly blocked its market for credit cards and the credit card industry in the united states has faced various licenses and approvals and all sorts of delays and they're still not able to fully go into business so i'm very skeptical and my enthusiasm is well contained love to see progress here, but what is not in the agreement is

much more important than apparently what is in the agreement. >> the way you've been speaking it sounds like perhaps you actually have seen this document, is that the case and i guess even more importantly than that, the enforcement mechanism in here, that's really where the devil is going to be in terms of the details and how this actually plays out in the coming months what is that going to look like, and why is it actually going to potentially -- why could it work when other deals, other promises from china in the past have not? >> yes, i'm very familiar with the deal let me just say this narrative this doesn't do the big things is an incorrect one and we will see this soon. like i mentioned before, three out of the four things i identified in the 301 report are in here. the credit card issue jeff is alluding to is in here and that is significant progress. in terms of enforcement, this is a rigorous enforcement regime. what it would allow to happen is

if the u.s. and china through consultations cannot resolve a problem, the u.s. would have the right to retaliate by putting tariffs in place at a level consistent with the harm that's done to their industry that's a lot like we have in other trade agreements so it's a real enforcement regime. the difference here is you don't have a third party adjudicator so there is some question about whether or not the parties will act in good faith in utilizing that i think that's a legitimate concern. but that brings me to next steps. i think what's really important here is not what's in the deal but what everyone does next. i do agree the implementation will be critical now that we have this enforcement mechanism we need to hold china's feet to the fire. but also looking at the multi lateral agreements, these things on technology transfers and other things, they apply to both the u.s. and china

we need to bring this neutral language into the wto and use it to jump-start the reform process and get all countries in the wto to help us enforce it together against china. and one last thing i will point out. in the areas where we came up short, where we didn't get as much as we wanted like subsidies, what the administration is doing is actually making progress with its allies and trading partners on getting disciplines that would apply to china just yesterday the u.s. and japan announced a proposal they want to bring in the wto to deal with problems with china on subsidies. i think we want to couple the two approaches, the bilateral approach with some of the multi lateral action and that would make this sustainable over the long term. >> that would be enormous pivot, jeff, because multilateralism is not the m.o. of this administration some said that's how he should have begun the process

that would mark a concern with how we run trade, isn't it >> absolutely. we're moving away from america first approach which relies on tariffs and bludgeoning china to get our way and working with allies, maybe rejoining tpp and working with them on subsidies as we were talking yesterday and other issues, i thinkthat's th way to victory i think that's what he ought to be doing actually any democrat will be tougher than the trump policy because they will start operating multi laterally, the most effective way to confront china. we want to bring in our steve liesman now from washington from an impact perspective on the micro level, the stocks i would expect to move on a signing like this, say deere, archer daniels, be midland they had their move in december.

in terms of economic impact of the signing of this deal and how it plays out over the next few weeks and months, what do you say? >> separate this into three different buckets. first one is the idea the tariffs remain in place so whatever the negative effects there are from the tariffs we see in the economy, the bulk of the tariffs will remain. that's offset at least somewhat by the fact there could be u.s. purchase of chinese goods. there could be some of it but it is to wait and see if china will fulfill. and the second one is the uncertainty and that had a substantial drag on capital investment by companies. it's remain to be seen if they will look at the document and say there's a truce now when it comes to the u.s. and china when it comes to additional uncertainty, that the way is clear for their to be additional investment and uncertainty diminished and you can't leave out the third element, which is a long-term element, this idea they had begun to address this

intellectual property issue. it remains to be seen what's in the document the first speaker is right, if he's right, that's a longer-term good for u.s. companies. i point out it might make it safer for u.s. companies to go further into china and doing case there that means there could be additional profits for u.s. companies. but for the shorter term you have to go back to the idea tariffs remain in place and see what happens, how executives take this issue up with another higher or lower or same as it's been. >> i want to go back to eunice in beijing we've been talking about what's great about this deal, ag purchases and other technology transfers in there on the chinese side they're saying this is a win-win what is the win that china has talked about up to this point on their end? >> the win is that it helps ease

some of the uncertainty, and also some of the tariff relief is there for the chinese so one of the big narratives here has been that the economy has been troubled, that the leadership is concerned about it so from that perspective, it does help to alleviate some of the burden or at least a fresh burden in the form of tariffs. but one other thing that isn't really discussed publicly but is discussed privately, and that is that china is able to benefit from the extra time because even though they're complaining right now about the big purchases they might not be able to reach these goals, at the end of the day they have been able to do something successful and that is to avoid any serious discussion about major changes to the way a china runs the economy so some of the private

discussions i have had both in and out of the government, people have said to me, china has more time now. the thinking is they have about one to two years of time to be able to see what exactly happens in the u.s. both politically and economically and that 12 months or 18 months down the line, the situation in the u.s. can be very, very different so in the meantime the focus here has been about self-reliance. when it comes to products that you make and also the technology that you use >> eunics, stay with us. all of the averages hit new intra record highs. >> i think we can exhale it's finally here. how long have we waited for this kodak moment a deal is finally in place i'm relieved i think the markets are expressing relief as well. yes, we can look as steve noted

the existing tariffs, they are for the most part still in place. the president reimpose tariffs if he wants to there are a lot of cynics say the chances are high he will do that i heard 50% chance he will impose tariffs between now and the elections. maybe. but let's look at what the markets are telling us now, the moment of peak uncertainty seemed to have pass. not just on trade. but look at the u.s. consumer and strength of the economy. all of the concerns about recession we had in the middle of last year, they're gone that uncertainty, recession unternty gone, trade uncertainty for the moment is on the back burner the fourth one that moved the markets, are we having a global bottom in the economy or not a little argument on either side but there's evidence there's at least some kind of bottom. those are the four big things

that moved the market last year. those uncertainties are lesser so when people say gee, why are the markets at a new high? i said why would it not be at a new high lessening the uncertainties we had. >> steve, i want to get your thoughts on the economic remodelling. we had the white house adviser saying give trump's tariffs a fair test and the economic models have been ignoring of tariffs and national security. we have not seen the tariffs play out in inflation data and, yes, tariffs will remain on a number of chinese imports but it seems to be now a detente in terms of more tariffs going into place. how does that get back to the economic model and does it need to change? >> i thought navarro statement was interesting yesterday when

he said the tariffs themselves and unconvinced more are that they lead to good outcomes i think intellectual property, that leads to good outcome but tariffs themselves are thought to be negative you can do a very simple exercise you can even do this game at home if you want, morgan write down what we thought gdp would be, in the 2%, even in the administration, 3% range we ran it at 2% and fed funds rate that was half of what it was with a balance sheet declining -- that was rising rather than declining. so we took a whole lot of stimulus to get us to the 2% change where as before we didn't believe we needed that stimulus. you see weakening and global economies, manufacturing being down i think the idea the tariffs did flot have an effect on the u.s. economy is vastly understated in

that we're barely able to do 2% growth with 1 1/2 fed funds rate so i think there have been substantial effects of the tariffs, and i think bob may be a bit optimistic in many economists think some of the worst of the tariff effects are still to come given we had a new round in september the worst was avoided but i don't think we're there yet to close the books on the impacts of tariffs it's good they're not suspended but a substantial of tariffs are in place >> that's a good point for our guest on the phone, john rutledge, former economic adviser to g.w. bush and ronald reagan john, i wonder, do you think we have seen peak tariff or not >> hello, carl i think we should not take on our election-colored glasses when we interpret all of this. the tariffs were purposely left out because of the election.

regarding the kodak moment we heard about, there are two sides of that. one is the u.s. gets to sign a piece of paper that shows progress that's a good thing. i don't want to say negative things about that. but regarding the chinese side, it's very important, most americans don't know this, but in china they have four vice premiers, and the one there is not number one, two, three or four so the chinese face, the most important thing on this regarding posture, the fact shea ping is not signing it it is an extremely positive phase for the chinese side this is a political victory for china. i think tariffs will stay until they are until the election. and we will see a little more growth but the main argument for ip

protection is coming from the fact all of the wealth created in china the last few years has been intellectual property and they want it as much as we want it. >> as we're lyistening to you, john, the white house has arrived. vice premier, minister of commerce, ambassador to the united states from china and head of the people's bank of china. clete, i wonder to john's point about the fact she's not here to sign it, is that a signal they are trying to save face, it's not being taken as seriously as it is in china as it is here >> i wouldn't read too much into that president xi was involved with this throughout. he was involved in the negotiations he was in the room with president trump talking about this in argentina. and then again at the g 20 this year in japan. we've been involved in this. hu has been the lead vice premier with the united states

i read less into the hierarchy as he's the man who's close to president xi i think they went to high school together and he's the guy appointed to do this and he's delivered. actually, i think this is a good deal for the u.s. and china. one of your other speakers alluded to this, higher standard interelection chul property protection in china is going to help bring investment in china there are a lot of people in china who believe that ultimately i think the u.s. objective here has never been about keeping china down it's been about creating a level paying field where our companies are treated fairly that's good for the u.s. and ultimately chiern's growth and that's what you see here that applied also to financial services, the banking sector is significantly in need of reform. this will help them move in that direction. >> john rutledge, you talked about election-colored glasses from the political perspective,

is this basically a win for the president election wise already? how long is it really going to take for us to see the impact of what's in phase one anyway might it not be so long that voters who are convinced that this is great for the u.s., great for the economy, even if phase one has its holes, will not see it play out? >> i don't think you're going to see any real impact economically between now and the election but the fact they signed a deal is worth something and as someone said, it lowers uncertainty and ought to be a help to capital spending and the like but the most important thing going on this week is the u.s. is starting to talk with other countries about cooperating on trade. that's what will actually solve this issue and it's not measured by the

bilateral trade negotiation. >> we want to go in the room at the white house for more as we await the signing. >> morgan, we're in the east room of the white house there's much heralded event scheduled to take place teleprompter is set, awaiting remarks from president trump we're told after that we should expect remarks from the vice president and vice premier of china and the treasury secretary steven mnuchin these negotiations have been going on for the better part of two years. a period of heightened volatility where tariffs were slapped on hundreds of billions of exports from both countries certainly there's been some deescalation with the rushering of this deal even before it is signed but there's still much to come the president said negotiation is on phase two and would begin immediately to try to get some of the thornier issues solved. this morning the treasury secretary said on cnbc that phase two would be accompanied

by rollbacks of attentional tariffs. something leaders of various businesses and industry have been wanting certainty on. many in a room today we will see exactly what happens from here on out now that this watershed moment of sorts has approached >> by my count it looks like we have 20 white house and trump administration officials that will be there today, including president trump. 27 lawmakers, all republican four state elected officials and only four members of this chinese delegation is there anything to be read in those numbers? >> there are four members of the chinese delegation officially listed on the documents that was white house released of chinese state media are reporting ten. but you're right to point out that's a fraction of the delegation and at times the delegation has ranged in the 30s in terms of number of people the country has

sent certainly, it is china sending a signal that it is something it supports but perhaps at the highest levels, there's more work to do certainly earlier in this project back in may, there was a translation of an earlier version of this deal chinese walked back significant portions they were not comfortable with and that created basically a period of escalation between may and september, where it was unclear whether we would even get to this day it's clear china did not get everything they wanted president xi trying to protect his domestic, political reputation there and one reason why you see a relatively small chinese delegation, despite the banter the white house is throwing today. >> eamon javers, i was reporting earlier this is very carefully choreographed, every step of the way. can you give me a preview or sense how this will play out in

the coming moments or coming out hour >> certainly the white house has all of its supporters here that have been cheering on this deal throughout the court of negotiations of course, white house officials are always reluctant to predict what the president will say because the marks get edited up to the very last moment. even as of this morning talking to administration officials, they said they were not exactly sure made it into the final order. what is clear the administration is celebrating this moment they are doing so privatel behind closed doors, dinner with the delegation last night. lunch with the delegation yesterday in washington. and publicly with an event at a scale we have not seen at least for a year of this administration the last time there was something of scale in this room was the nomination of brett kavanaugh in the summer of 2018. one other point i want to highlight in our reporting is

the level of purchases the chinese will be making as part of this deal you heard larry kudlow earlier today put some ranges on those numbers. but three sources familiar with this deal have provided a little more specifics i have made a graphic of this but i do not have the numbers right in front of me now you will see $32 in agriculture purchases, just shy of $78 billion in manufacturing goods and roughly $ 50 million in the energy space and $40 billion on services as well you can see the specific numbers, total is $200 billion those are the purchase targets china will be trying to make the administration will be inhaling that significant portion as a win here. that's something the president ha been pushing for throughout these negotiations but china has only said up to this point it will be buying from all of these overseas vendors in coordination

with the market demand certainly trying to couch exactly what it will be doing, even though the administration of people we have spoken with who have seen this deal have been willing to put a finer point on >> caleb, before i lose you to the room there, the market would love to know of that allocation, what goes into auto parts? what is ag machinery what are medical devices what are semis any chance we'll get that level of granularity. >> we will try to report that out, carl, but the administration has been incredibly tight-lipped on this fact back in december they held a meeting before it was fully translated and that question was asked at that briefing he said clearly he did not want the numbers out there because he didn't want disportions in the market he wanted the market economy to function as it otherwise would without the statistics out there. that being said you can be certain commodity traders are trying to figure out exactly

when this text hit and exactly what key words, product names, will be in there to see if there are any actions they might take. i heard from various traders plan to do just that but certainly insofar as the administration hoped, it does not want specific numbers to become public to distort those type of scenarios. >> i want to go back jeff moon, former u.s. trade rep to china on this issue of what these agriculture targets really mean. it sounds like from the u.s. side, larry kudlow, who was framing this as here is what china wants to do. this is more of a target and it's not going to reduce purchases from other countries as well. based on your experience, what is china really saying >> i think that's a very important question the administration has emphasized all along the need to

have enforcements. if you don't have precision in these numbers, how can you enforce the agreement? we know that the assumption in 2017, i believe it was $16 billion, was much, much lower than what they're committed to do right now i think there are skeptics everywhere how is china going to make up that difference? i think the chinese are fearful they may be falling into a trap where the numbers are too high they can't in good faith meet them and, therefore, will will be some kind of snap-back tariff dispute. so i think this emphasizes the need for details in this agreement. we need precision, exactly what was committed to, what people said they would do so we can then have accountability down the road. >> steve liesman, china committing to potentially having these targets of up to $200 billion of additional u.s. goods and services over the next two

years, how is that going to play out here in the u.s. economically speaking? when you're thinking about more manufactured goods, you got to think that's going to change the inventory numbers. it will change capital spending numbers, be able to hit some of the targets. >> i know a lot of economists will be listening closely to kayla toshy and her reporting of what these numbers will be because they will figure into gdp. if these targets are met it will have an impact on gdp and growth and i want to come back to one thing, the good and bad of of this deal. it's quite remarkable president trump managed to change the facts on the ground. here he is about to have a i signing ceremony with the chinese where 1 1/2 rounds of the tariffs remain in place. if you're peter navarro and part of that camp, this is a huge win for those who want tariffs this

place to even the playing field with china if you're among a set of economists and free traders, they see that as a very, very bad outcome. quite remarkable, this is hat's off to what the president wants in his deal-making skills. he signs a deal with the chinese where the facts on the ground has changed to a much higher tariff regime as we go further into further negotiation it's a very big deal in that regard i think. >> watching the audience fill in, our steve schwartzman. ment and a bit of liaison between the americans and chinese. commerce secretary on the left side, lou dobbs in attendance. we're also told sheldon adelson is there, henry kissinger. the optics of this -- we took that live shot of the text we would love to get our hands on that red book and what we think is about 86 pages of translated text. but the subtext is important in

some way. >> yes, i'm here you see a lot of support there at the white house for what the president is doing i want to weigh in for a second on this commodity purchase issue. i'm not going to get into the specific numbers other than what the white house has already said publicly, which is on agriculture they will get up to $40 billion a year from china. everyone needs to remember the baseline they're using there is 2017 where we had $24 billion in sales to china and that will go up to $40 billion. a lot of people said no, that's not realistic but once you see the agriculture captor, you'll understand why it is just to give you a couple examples, poultry is a market where we sold zero dollars into china in 2017. they're now going to get rid of their ban on u.s. poultry and that is something the usda has said publicly will be about a billion and a half dollar market you look at beef

we sold almost zero to china in 2017 they will get age and traceability requirements. that, again, is somewhere you can have about a billion and a half dollars pork, they're dyeing from pork in china with swine flu. that was something in 2017 it was half a billion and can go up to around $2 billion i'm not giving specific numbers but illustrating what analysts said where this could go soybeans is another one with the biotechnology aapproval process what you're going to see from the white house today is top-line number on agriculture, on manufacturing, on services, on energy but i want to illustrate, even if you don't see the details, when you do see the systemic changes, you can see how those numbers can build pretty darn quickly.

>> kayla, i think we can forgive some people being cautious around some of these numbers pete was just talking about because the road to this moment in the road with china has been paved with misunderstanding. u.s. saying one thing is the case and china saying not necessarily. how controversial are these numbers, these targets or how much do you think they really are understood in the same way by both sides >> i think any administration is right to reserve judgment on whether china will deliver often some of the promises not just trump administration but the administrations prior when they got china to make these commitments. certainly many who will be most focused on whether china can agree with these promises are executives operating companies on the ground in china who have been dealing with some of these restricted practices for decades now. i want to fill in the audience for you a little bit carl, you were mentioning people here, members of the

administration there are many familiar corporate bases. i saw the ceo of qualcomm, al kelly, and the ceo of mastercard and ceo of jpmorgan asset management one of the hallmarks of this deal is the opening of the financial services sector. this is something china has been pledging for at least three years. we heard many of the executives say even though these lofty promises are made very publicly, on the ground it's been really difficult for them to get licenses for them to actually see china affect some of these promises they're making. many in the audience are cheerful observers i turned to try to get a couple comments but much to my chagrin they wouldn't offer any. they're here and cautiously optimistic but they say in many cases they have seen this before. >> if anyone gets comments, i imagine it will be you certainly financials is one of the worst-performing sectors because we have earnings from

bank of america, goldman sachs weighing on that sector now. in general as earning season gets under way, we get the deal signed and more details, we will hear more about what this trade deal can mean for companies this year is that going to become a bigger theme? >> the bulls are hopeful once this deal is solved and you get this uncertainty behind you, there will be more optimistic commentary it's what you want to hear on the earnings calls where they say we feel more confident, blah, blah, blah it's more of a change in tone than everybody saying we're changing our purchases i'm a little optimistic than i was a few weeks ago for fourth quarter and q1 numbers that's what we're looking at there were disappointments, fedex and micron, but the bank numbers have been pretty good so far today. look at goldman sachs. goldman had good numbers, opens down six, ends up three right now. i think we have a very good chance, down a little bit for the fourth quarter, we could end up three, four percentage points

if this continues. if we get into positive territory and numbers stop coming down for 2020, we can see 5%, 6% growth in 2020 and that might be good enough with uncertainty removed or at least lessened. >> as you're talking jared kushner and ivanka trump in the room along with trmansportation secretary chao bob rutledge, commentary about global trade, i'm reminded what dimon said yesterday at jpmorgan, resolution of trade issues help support climate inactivity towards the end of the year do you respect corporate commentary to reflect this signing today? >> i think so. it's been earnings called on the negative side before so we will hear positives i think we will hear some positives from ag sector as clete was saying, allowing you to buy chickens is going to

make a difference. the numbers, projections to me, don't mean anything. the changes in the rules make everything happen. i think that you're going to see some more action later in the year keep in mind two things -- three things first of all the names you're reciting in the name are political names, not economic names. second of all, the numbers that everybody talks about with the china/u.s. are gross numbers, not net trade numbers, and they're bilateral, not multi lateral trade numbers. which means if we sell something to china and they turn around season ship it to another country, it will count as china buying from us even though they exported to somebody else. and there's no way getting around that. jill from exxon said motor oil is motor oil and soybeans are soybeans. >> it let's talk about the political implications of this it is an election year what is the push bak likely to

be from the democratic side and challengers on this trade deal is that already organized? are there already talking points being distributed trying to knock down this as not a big deal, which the trump administration, of course, is saying it is >> they're certainly trying to allude to some of the arguments. not only ten months from the general election but 20 days from the iowa caucus, one of the battlegrounds where the trade war is playing out front and center you just had the democratic candidates last night in des moines talking about the economy. but they've really struggled to draw the line exactly where they come down on this, whether they would keep the tariffs in place, whether they are effective, whether the tariffs are a good deal or bad deal many said they need to see the text and not actually willing to say president trump is doing the wrong thing. they say that his strategy is ill-founded but ultimately china

needs to be gone after they're a rogue actor in the global economy but really struggling to say what they would do differently and what the different outcome would be if they were to pursue that. >> eamon javers, as we're showing life footage of the room, one of the people in and out of the shot is robert o'brien, relatively new national security adviser to president trump. it does seem like even as we get this trade deal, this phase one trade deal today, increased purchases of american goods and services simultaneously reports that the administration is going to track down harder on the supply chain for huawei. how do we balance how this administration is approaching both trade and the longer-term issues around national security? >> sure, and the big question i think coming out of today, is this going to be one and done on china trade for 2020 i asked the president about this in the roosevelt room last week, and he said he thinks he might

wait to begin negotiations or finalize negotiations on phase two, as they're calling it, until after the election in november it might be the case this is the only ceremony of this type that we see this year in washington that's why it's so important to the president, who views this as one of his most significant accomplishments in office. i think we should step back and note the extraordinary split-screen day we're having in washington, d.c. as the president is participating in this signing ceremony and touting what he sees as a major, major accomplishment here. we also have the speaker of the house down pennsylvania avenue naming impeachment managers today and they're going to walk the articles of impeachment over to the senate chamber later on this evening to kick off an impeachment trial of this president. so a dramatic day in this presidency and all of it setting up how he's going to contend he's the best person to be the president of the united states in the selection in fall this, he feels, will be one of the big pieces of evidence why

he should be re-elected. >> chinese delegation in the room, eamon, and to your point about the president's comments to phase two, larry kudlow did say this morning phase two would begin immediately. not the first time we've seen discrepancy what the president says and what a member of the cabinet says we see the chinese president enter the room give us color how they see not just the deal but how they feel walking into a ceremony like this one in this country >> well, they're probably feeling some level of cautious as well as some level of relief when it comes to this negotiation that has been going on for quite some time i wanted to talk though to somebody not in the room, and that is president ping

there was an expectation here in china president xi would be signing the agreement with president trump and the chinese administration and in particular president trump from face perspective would want to be seen as sitting down with president xi when president trump had indicated he was okay with the idea of sitting down with the vice premier instead, that was a bit surprising here in china, but people did think that at the end of the day, it would be a good idea to be able to try to come together and have some sort of agreement but what is significant from the fact president xi does not have his name on the dotted line is that from a chinese perspective, that means he is not responsible if there are issues with this deal down the line and so the one who signs it is the one who has to take the brunt of the responsibility. so in that way, it in some way

safeguards him of any potential criticism if at the end of the day there is no criticism that china didn't get exactly what it should have gotten from this phase one trade deal >> i want to go back to kayla in the east room at the white house right now, as i think the ceremony moves closer to commencing the fact this is an 86-page document we're expecting, the translation was really going sort of down to the wire here in terms of details is the expectation we're still going to have this released in its entirety on the heels of this signing today >> it is morgan, this is something the administration has been working painstakingly to put in writing. it was in writing about a month ago at least in english. for the last six weeks or so the administration has been working with the chinese to translate that into a translation it found

to be effective and workable and enforceable. that is what we're expecting to see released when this is signed, a document closely watched by corporate america and by trading floors as they seek the exact language of what's in it i can tell you a lot of this goo some trade deals bellwether for future deals. a lot of that property language hues closely to what we saw in usmca. you can figure out a little bit about what's in it and what it could look like. although it is, as they will say, a much broader and bigger deal let's go now to the president. >> ladies and gentlemen, the president of the united states, accompanied by the vice premier of the people's republic of china. ♪

[ all hail the chief ] ♪ [ all hail the chief ] >> thank you very much we greatly appreciate your joining us at this white house this is a very important and remarkable occasion. today, we take a momentous step,

one that's never taken before with china, to a future fair and reciprocal trade deal between the united states and china. together, we are writing the wrongs of the past and delivering a future of economic justice and security for american workers, farmers and families i want to thank president xi, who is watching as we speak, and i'll be going over to china in the not-too-distant future i want to thank president xi, a ve very, very good friend of mine we're representing different countries. he's representing china. i'm representing the u.s. but we've developed an incredible relationship i want to thank him for his partnership throughout this very complicated process. negotiations were tough on us, open and respectful, leading us to this really incredible

breakthrough people thought this never could have happened. should have happened 25 years ago, by the way. that's okay. a man who also has become a good friend of mine and somebody who is very, very talented and very capable, delighted to be joined by vice premier, ambassador and many other people from the republic of china. vice president mike pence is with us. mike, i would like to have you say a few words, please. >> thank you, mr. president. it's an honor to be here with vice premier liu he.

in a time that the american economy is booming with the strong support of members of congress who are gathered here we are now experiencing an economy that's created more than 7 million jobs unemployment rate is at a 50-year low. the average american household income has risen more than $5,000 that's all a result to your commitment to roll back taxes, and it also reflects your commitment to free, fair and reciprocal trade you made it clear that the era of economic surrender is over and you took a strong stand for american jobs and american workers. you said to our friends in china that things had to change and, thanks to your leadership, today the change begins. [ applause ]

thanks to your efforts, mr. president, we announce great progress on protecting intellectual property, forced technology transfer and currency manipulation t means so much to you, the greatest impact may well be on american agriculture, 30 to $50 billion that will result in greater prosperity for farmers all across the land. mr. president, your commitment to a growing and prosperous america has been the centerpiece of your leadership and today with the signing of phase one, another commitment to put american jobs and american workers first. we recognize differences will remain between our two nations but today is the start of a new chapter in trade relations between the two largest economies in the world i can assure the american people that this president will ten to

stand firm and put america first even as we forge a more productive relationship with china and with the world mr. president, you know there's an ancient chinese provertebrae that says men see only the present, but heaven sees the future so, let today be the beginning of a brighter future, more prosperous for the american people, the chinese people and the world. thank you, mr. president [ applause ] >> thank you thank you, mike. an incredible job. incredible guy i also want to give special thanks to our u.s. trade representative, who has been kept very busy he's doing a lot of deals. we'll haveanother big one next week it should get approved very shortly, and that will be tremendo tremendous, with canada and mexico, but we'll talk about that next week but robert lighthizer, are we keeping you busy enough, huh

the poor guy can't sleep what happened to him >> sorry that dropped >> thanks. mike that's right, you are all purpose, come to think of it bob lighthi zechlt r is sharp and smart and understands trade better than anybody. when i first took this, i said i've got to get the best guy and all signs pointed to robert lighthizer, so thank you very much, bob. [ applause ] i have one question. was this an easier job or tougher job than you thought

[ inaudible >> had a feeling he might say that also a great treasury secretary steven mnuchin has worked hand in hand with bob thank you very much, steve good job [ applause ] so this really is a landmark agreement. along with them, we have the exceptional jared kushner. where is varied? great job, jared he worked hard he left a beautiful, nice, very prosperous real estate business and came here, and i can tell you, that was harder -- this is harder than real estate in new york isn't it, jared? but you've done a fantastic job. you don't get people like that so, thank you very much. ivanka, nice to have you here. thank you. also somebody i've heard for 35

years. the voice just -- a great gentleman, a friend of mine but a great gentleman. we brought him in and he has been outstanding the only problem is, he doesn't like going on television very much a little bit shy about that. larry kudlow where is larry [ applause ] >> where is larry? we had a day where the market went down $1 trillion. think of that. in other words, it was one of those few days, because we've had 141 days where we hit all-time highs and we just broke, as you know, we just broke the 29,000 mark on the dow just now as we're walking in market is up substantially today. but larry kudlow went out on to the beautiful lawns of the white house, standing in the rose

garden, beautiful scarf waving in the wind. everything perfect, right out of greenwich, connecticut he started talking by the time he finished i said you just made $1 trillion, because the market went up like 250 points i said, larry, what the hell did you say? and it didn't matter, but we were even. we went from being a trillion down to even and that was pretty good larry, you've been fantastic thank you very much. appreciate it. [ applause ] by the way, our great ambassador to china, right, governor. so we've had the governor of iowa and he loves china. and he's the longest -- you're the longest serving governor in the history of our country, like 24 years i called him and i said governor, you have to do me a favor. because i remember one conversation i had with him. i was going in to make a speech before the election. and he said, sir, please don't say anything bad about