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come on and find it ♪ >> good thursday morning welcome to "squawk alley." i'm carl quintanilla with morgan brennan and jon fortt at post 9 of the new york stock exchange the market taking a breather, down 134 on pace for the biggest weekly decline in a few months we begin at a world economic forum in davos where sara eisen has a special guest. >> marc benioff is the founder of the sales force, the man of davos, i would say good to see you. >> thank you for saying that >> you made a lot of headlines when you said capitalism as we know it is dead. what do you mean >> people have been asking why am i wearing this black suit and -- >> you're in mourning? >> -- tie because i'm at a funeral for capitalism >> what do you mean by that?

>> it's dead >> you have a public, right? >> you know that capitalism is dead and we are introducing a new capitalism here, a stakeholder capitalism, which is a more sustainable capitalism, a more equitable capitalism, a more fair and just capitalism. it's not like -- the old capitalism, you know, is all about milton freedman. business, business, business, money, money, money. the new capitalism is the new stakeholder capitalism, business is the greatest platform for change i've heard that before >> you have heard it before. >> you've been out front on this issue. >> yes it's why i started my company 21 years ago. >> i guess my question is, you know, traditionally wall street and analysts and investors reward share buybacks, cutting costs, layoffs, meeting guidance these are all sort of short-term thinking it goes against your long-term think being. how do you marry that and see

this paradigm shift play out in the market >> well, we went public in 2004. i thinkthat's when i was first on cnbc. since then we've had a 4,000% return for our shareholders. they've done just fine we've also given away $300 million. that's part of our stakeholder return we make sure we're a net zero company because the planet is a stakeholder. we've adopted 170 public schools because our public schools are stakeholders we make sure we pay men and women equally for equal work because our female employees are stakeholders we have a great shareholder return, but we have a great stakeholder return and that's how we marry them together. >> why do you think everybody else is coming around to it now? is there a crisis of trust with business or is it potentially reaction to the fact that there's not leadership at the top? president trump withdrawing from the paris climate accord what is it >> i think everybody realizes that, you know, we're in a planetary emergency, and we need to make changes. and business is the greatest

platform for change. if you ask what the narrative has been at davos, there has been a trenamendous narrative around what can we do for the state of the world president trump has announced he's joined one2.org, one million trees on the planet, an initiative >> you're supporting it. >> i'm supporting it, also the chinese government supporting it, the european government is supporting it, the president of colombia, duque, is supporting it, and over 300 companies have come forward in davos to say they're going to participate that's in the first 48 hours and it's very exciting because one trillion trees sequester 2208 gigaon thes of carbon we used to have 6 trillion trees on the planet. we have 3 trillion trees we have 500 gigatons of

atmospheric carbon that needs to come down and one very efficient way to sequester carbon, actually the most efficient way to sequester carbon is -- >> planting trees. >> it's the tree >> you were here with the president. >> nobody's against trees. >> nobody's against trees. >> the tree is also a bipartisan issue. >> and it's the first time we've heard president trump talk about climate change >> well, they've been all in from the beginning of the idea, which was amazing, and they've been excited to come here and make the announcement at the world economic forum it's convening -- i'm a trustee. i worked with charles schwab, the co-founder this is one of several major environmental issues that they're supporting but it's very exciting to see 1 trillion trees, and we're going to do this over the next ten years >> we're also here at davos talking about tech and disruption and whether it's a force for good what's your relationship like these days with fellow tech

ceos you've had twitter fights. you've called facebook the new cigarettes >> they get nervous when i come in the room because i ask them one question what is your highest priority? what is your highest value what is truly important to you and i think that maybe they're board members, they're investors, and i think it's kind of the shift again from pure shareholderism to a new stakeholder capitalism that, you know, you have to ask yourself, what is your highest value what is truly important to you and if trust is not your highest value, then your company is going to be in a crisis of trust. >> facebook is coming off a year it rallied 60% despite this crisis of trust and controversy after controversy, earnings continue to grow. consumers, you know, continue to go on the platform investors continue to buy the stock. >> making money is easy, but doing the right thing is not eventually every company comes to that point, and we've seen that over and over again

we don't have to look at history to understand that leadership eventually is about what you do and who you are and what your legacy is reflected in your values, and you have to decide are you going to tell the truth, are you about the truth or about something else >> facebook you don't think is there. >> i think you look at, you know, they're a great specific example, are you about truth and trust? you know, those are the two t words. truth, truth, trust, and time. that's value >> i have the "times" special dav davos issue. president trump and greta lundberg on the thing together he was bitter he got the "time" person of the year did you hear from him about it >> i dead. >> did he complain to you? >> i think he's actually quite

supportive that she is on the cover. i think that, you know, at the end of the day, she is a fantastic person of the year, and i think it's our most popular person of the year choice ever. and look, she made her first major global public appearance in davos one year ago. look at what she has done over the last year. it has been spectacular. and i think that a lot of the change and understanding what's happened with climate, well, a lot of it is led by her. she has been the spokesperson that we have needed. >> she has more paparazzi around davos than you do. >> thank god >> you've criticized facebook, not so much twitter. i read in the book the story of how you passed on the twitter deal, listened to those around you, had an epiphany after falling on the ground. do you think twitter sumps from the same sort of addictive qualities that you criticize facebook for >> i think they've made more positive changes

youtube has made 50 policy changes. the ceos of these major tech companies, i'm one of them, have to look at their values and have to decide. exactly what we were talking about. are you about trust? are you about truth? are you about the equality of every human being? you have these amazing platforms. is business is the platform for change and you have this amazing tech company platform, what are you doing with it? are you using it to make the world better or just using it to make money i think that is the choice here in davos and in some ways a false choice you can do both. >> david salman today, goldman sachs ceo said we're not taking a company public unless there's a female on the board. >> i think that's a great first step i think he should also say he should not take a company public unless they're net zero. no more carbon >> not might be taking a lot of companies public >> we're net zero. lots of companies are net zero we'll be fully renewable, fully

carbon negative. we committed to planting 100 million trees here at davos, which i think will be -- you know, it's a very significant amount of carbon sequestration, and i think every company should do that. >> about elon musk hot topic with his $100 billion auto company would you invest, bet on him >> i think he's the edison of our time i don't know where he comes up with these ideas it's incredible. >> you and president trump >> one day he is drilling holes in the ground. the next day he's landing a rocket on mars based on artificial intelligence. the next day he has the most incredible automobile going down the road by itself he is an impressive entrepreneur and an impressive innovator. >> also people look to you as a gauge for intenterprise spendin, 2020 outlook you've seen strong growth. what are you seeing in the come moogs? >> i'm very excited about growth this year we've given guidance that, you know, coming up we

think we're going to get to about $21 billion in revenue, very exciting, up from about $17 billion in the year we're fin h finishing. i continue to see digital transformation as the number-one thing on every ceo's mind. they want to have a digital relationship with their customer every digital relationship begins an ends with the customer and the major customers we have at davos that i've met with, people like volkswagen or adidas or louis vuitton, they are all deeply focused and committed to their digital relationship with their customer, and that's why we're so xiltded to work with them >> do you expect to see a pickup as a result of the u.s./china trade deal having some certainty there in terms of spending from corporations >> i don't think that will be a huge catalyst, actually. i think the real catalyst is the united states. the u.s. growth has been pretty phenomenal and we continue to see tremendous progress in the

u.s. economy you saw more unemployment drops in the fourth quarter and at davos, we've heard 72% of the people entering the workforce were women that's impressive and amazing. i expect the unemployment rate to drop in the united states that's powerful. >> the president came here to list some economic achievements. has he been good overall, beneficial overall for tech? there were some threats of antitrust violation and privacy regulation and some twitter attacks. but in the end, these stocks have done remarkably well and have seemingly benefited >> well, look, every president is going to have different values you know, these presidents, administrations have changed we talked about that our values haven't changed there's going to be good things and bad things you know the immigration policies have been difficult i think for the tech industry because we need more workers

that's really important for us to grow. at the same time, it's great to have a powerful economy because we also need that to grow. so, you know, you're never going to get everything, and you're going to hopefully get, you know, the best that you can. >> yeah. marc benioff, thank you very much >> great to see you. >> that's the founder and ceo of sales force. >> sara, your last interview high five. >> grand finale here >> how was it? last interview >> trees are bipartisan. >> trees are bipartisan. >> back to you guys. >> congratulations onda voc dav. >> and to you. >> thanks again to marc benioff from out there in davos. now we want to get to the markets. some shift movers. morgan stanley updating micron and western digital this morning. the analyst behind that call, joseph moore, joins us now good morning >> hi. good morning >> so tell me, what's going on here because you say there's some

changes in the memory market in particular the buying activity. is this about sentiment, about people stocking up will it have impact as the year wears on >> i think so. the two companies we upgraded are manufacturers of semiconduct semiconductors it's still a commodity we've seen prices go up since, you know, the fourth quarter we missed a big move by being a little skeptical about that early on in the fourth quarter, a lot of the strength we were seeing was being attributed to things you're referencing, inventory build, tariff anxiety, and a lot of the channel checks we had said we would get past these december 15th potential tariff and there would be air pock net demand demand in the last 30 days we've seen good demand, firming of pricing and conviction that prices will

continue to move higher throughout the year. even with the stocks having done what they've done, relative to the rest of semiconductors, there's positive ramifications for where these stocks can go if those commodities stay strong. >> the stocks have been sensitive to trade headlines is that why they're firming up, perhaps? the expected phase one deal and then the signing of that is it something else or is this volatility we could see continue things look good now but in a couple weeks they might swing the other way. >> i think it's certainly being been a pretty big aspect of what's happening the tariffs that were supposed to go into place on december 15th that eventually ended up not going into place, pretty big ramifications for memory so i did feel like at the time there was some prebuilding in front of those tariffs i think that day of getting those behind us, the phase one deal was probably less of a factor than just not having that as a major factor.

i do think that the demand we're seeing now is a little bit more responsive to demand there are anxieties globally about the ability to procure things there is a willingness for customers to hold more inventory so we have to keep a close eye on it. but when we see the conviction that prices will continue to move up and in some cases in the nan space, one of the major commodities, outright tight supply even in seasonal weakness, there's pretty high conviction that will persist through the year unless there's a real demand-side shock that changes that conviction, it's hard for me to see that inventory getting drawn back down. >> to your point, we have seen revenues come down for many of these names in recent quarters working through inventory here, we've seen a correction in the market more broadly you're talking about the firming up and increasing in pricing for some of these semiconductors as well. given the pretty dramatic

rerating we've soon in teen in e stocks betting on this bottom, at what point do valuations look stretched? >> that's 100% right over the course of last year we saw very weak fundamentals and very strong stock performance. so the whole group has really rerated. i think the question now that things are getter better is who's earned that rerate where are the companies where that downturn looked more shallow than what we've seen in the past and following a strong upturn from 2017 and 2018. i think we'll look at these stocks and say -- and we were fairly cautious over the course of last year over semiconductors there were a bunch of demand indications we saw in this memory space i think now that it's kind of bottoming out, i think you look at that and say, okay, in memory, we had very challenging conditions, demand at kind of 2009 levels of demand growth yet we're bottoming at levels in the case of micron, close to the levels they peaked at a few

years ago. it really suggest, yes, the whole sector is rerated. the call today, certainly semiconductor companies have earned that rerating by showing us the shallow nature of the downturn and the stocks thatch the most leverage if this improvement continues. >> you don't shy away from the notion that there might be some pull forward of demand, particularly in china. you raised the risk that maybe 5g gets deferred as a consumer buy. how serious would you rate those risks? >> they're pretty material risks over the long haul i think to put that in perspective, there is always an aspect of that you know, particularly in these price-sensitive commodity areas, when prices bottom out, the customers are always more willing to hold inventory. so we're certainly seeing that now particularly coming off of fairly significant shortages in 2017 and 2018. there is a willingness to hold inventory. that's part of what's going on

as to whether that's specifically china, the data doesn't show that. there have been some pull forwards in china for sure, but we've seen china as a percentage of globally going up by a couple points, 42% to 44% of revenue. it's been a small change micron has made cautionary comments but it's a relatively small part of their business i think it's something to watch and we are going to need demand followthrough. we have pretty good demand in cloud, pretty good demand in pcs that's likely to slow over the year, and smartphone where the builds have been pretty good you'll have to watch those factors. but right now when you put all that together, it still looks like a pretty strong environment for memory, particularly for nan where we're seeing prices rising >> a strong day for some stocks. western digital up nearly 3% joseph moore from morgan stanley, thanks. >> thank you very much when we come back, thinking about going public

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this after the cfo, mike kavanaugh, warned that the company expects higher video subscriber losses this year, saying, quote, video is still valuable for us to attach to our broadband centric customer relationships but only to the extent that it helps us increase the lifetime value of those relationships. there's a segment of the market that either doesn't value a traditional pay tv service or isn't profitable for us to serve. we are not chasing that segment of the market. comcast ceo brian roberts saying as the company reduces reliance on shrinking demand for traditional tv bundles, it's staking its future onbroadband growth >> we made a pivot to a broadband centric cable company that, whether it's for streaming or gaming or any other app a this you're interested on your television, the best wi-fi, that's the number-one product. that's what we go to market with we now have a mobile product and we have multiple video

offerings. >> roberts saying the whole company is focused on serving customers in the mobile world. he said he's confident about the launch of peacock and they're also continuing to grow their broadband product for stlereame called flex. back to you. >> julia boorstin, thank you for bringing us the latest putting pressure on other media stocks as well up next is the era of the unicorn over in silicon valley we'll explain that one after the break. stay with us ♪ ♪ ♪ ♪ ♪ ♪

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welcome back goldman sachs' ceo david solomon telling cnbc the firm won't take companies public that don't have at least one diverse board candidate with a focus on women. >> solomon says they could lose that on some business but in the long run it is the best policy to drive returns >> starting on july 1st in the

u.s. and europe, we're not going to take a company public unless there's at least one diverse board candidate with a focus on women, and we'll move guard 2021 requesting two we realize that this is a small step, but it's a step in the direction of saying, you know what, we think this is right >> he added that about 60 companies in the u.s. and europe have gone public recently with all white male boards. despite multiple studies that suggest companies with diverse boards have lower volatility and better performance, women are still underrepresented and progress has been slow according to deloitte, women and minorities held 34% of board student-athletes among fortune 500 companies in 2018, an increase from 31% the previous year in private markets, venture capital investment in all female-founding teams represented less than 3% of capital invested in states of emergency of all of the ecosystem last year. just 11% of decisionmakers at

these firms are women. some of the biggest and highest profile unicorns still don't have female representation on their boards here's a view of them. they include doordash, juul and palantir this isn't just an issue solomon is get beg hind, blackrock and others back to you. >> dreeirdra, i was going to brg up a california law baz it seems some companies like doordash would have to add a female director anyway. moving two two and the impact on europe would be pretty big, would it not >> it would be i think the main point is you need to get female directors on board earlier. it's interesting you kind of see a little built of a trend here when companies get ready to go public

they start adding a woman to their board if they don't already have one perhaps raising the profile, solomon's comments, as well as the law in california will encourage companies to do it a lot earlier. that's the hope at least >> green washing maybe face painting will be the new term for throwing a woman on right before the ipo as opposed to building diversity in from the beginning. maybe we have to create a new term for that. >> laws in california also the eu, deirdra bossa, thanks for breaking that down for us. european markets set to close in a moment mold mo seema mody has the action. >> china down nearly 3%, european markets are mostly lower today after the european central bank opted to hold interest rates steady with christine lagarde striking a more devilish tone than expected they're set to launch the first policy review since 2003 aiming to tackle whether the inflation target of around 2% is still

appropriate. lagarde noticed that lower wages are underpinning the euro economy along with a sluggish manufacturing environment. listen in. >> in particular, the weakness in the manufacturing sector remains a drag on euro-area growth momentum. >> now, adding to pressure in europe are growing fears of the spread of coronavirus. the european center for disease prevention and control noted the further spread of the virus is likely we've been watching the impact on luxury retailers that rely on the chinese market, like lvmh, richemont lower. >> seema, thank you very much. sue herera has a news update >> hello, everyone here's what's happening at this hour the trump administration publishing new visa rules aimed at restricting what's called birth tourism in which women travel to the u.s. to give birth

so their children can have u.s. citizenship. birth tourism is a lucrative business in the u.s. companies take out advertisements and charge up to $80,000 to facilitate the practice three people including a 9-year-old boy remain hospitalized this morning after police say several people opened fire in the busiest part of downtown seattle during the wednesday evening commute. one person was killed and seven were wounded nepalese authorities deciding to end the search for four south korean climbers and three nepali guides buried by an avalanche on a popular trekking route last week. crews have not been able to find any clues of their whereabouts a new study is showing just how much food americans are throwing out researchers from penn state university analyzed data from 4,000 households and they found that on average americans tossed nearly a third of the food that they buy, costing them an average of about $1,800 a year

you are up to date that's the news update this hour back downtown to you >> sue, thank you very much. after the break, boeing shares heig s higher today but nearly 7% in the last week the ceo of airbus joins us in a moment sell-off has resumed, almost down 200 . that's what happens in golf and in life. i'm very fortunate i can lean on people, and that for me is what teamwork is all about. you can't do everything yourself. you need someone to guide you and help you make those tough decisions, that's morgan stanley. they're industry leaders, but the most important thing is they want to do it the right way. i'm really excited to be part of the morgan stanley team. i'm justin rose. we are morgan stanley.

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alley. an air bugbus subsidiary will be partnering with the nasdaq for a trading venue. this could hedge revenue risk through indices that track the daily fluctuations of air fare joining us with more on the partnership, airbus america's chairman and ceo, jeffrey knittel. thanks for being with us today >> hello, morgan how are you? >> doing great so skytra basically cash settles futures and options contracts allowing airline customers to hedge risk around air fares. how does this work and why does it make sense for airbus to be getting into a financial instrument like this >> well, if you think about it, the industry's morphed over the last 10 to 20 years from an industry that was really focused on cash generation to one that's been focused on profitability and predictability and as it looks at

predictability it's come up with various ways to hedge its costs. when you think about the cost side, you think about fuel, currency, interest rates the one thing that to date has not reallybeen predictable or as predictable as it could be in terms of financial performance has been revenue so as a partner with many airlines and understanding what the airlines are looking for, and i would say in a line partner because we, too, want a predictable airline industry, we put a team together and came up with a concept using data, large amount of data, to analyze flights and fares from around the world. and that's how and why we launched skytra. we think this will enable airlines to be able to be more forward looking and more stable in their performance going forward.

so the realty of this is we are trying to help our customers because we are truly -- we want to be aligned and we want them to succeed fundamentally it's about the ability to aggregate the data, analyze the data, and make decisions. as you're probably aware and it may be true of your own travel practices, that most people, 90% of travel, the decision occurs within 90 days but the commitment the airlines make are long-term commitments, whether they're for airport infrastructure, whether they're for airplanes, which obviously we sell. they're long term, 20, 25-year commitments. so having a more predictable revenue stream we believe will be very, very helpful to them. so that's the basic concept, morgan >> okay. in some ways it reminds me of some of the attempts we've seen with trucking futures as well.

i'm kushs you about the timing what spurred this? ''the the 737 max grounding, did that play a role here >> this is something we've been working on for two to three years and this is something we had heard was -- airlines continually asked and talked about this, and we felt that there was a need we could help provide a solution for, quite honestly it had nothing to do with the other factors. we just saw a need and had a solution >> you announced recently increased investment, plans to ramp up production for the u.s.-made a320 jetliners how much of this is driven by demand as that 737 max grounding continues to put pressure on airlines versus the presence of tariffs on europe-made planes post wto ruling? >> well, it's about demand the reality is we are sold out

for six years on our single-aisles, and that's because we believe we just have a terrific product that there is a lot of demand for. because of that, we made a decision, by the way, globally, to increase production to meet the demands and requirements of our customers. so we've increased rate, we're increasing employment. now, specific to the tariff issue, fundamentally, airplanes that are produced in mobile are not tariffed we're not a believer in tariffs. we don't see how that helps anyone including the industry or the economies globally but airplanes produced there are not tariffed and are -- so -- and we will deliver u.s. airplanes to mobile -- from mobile in the u.s. >> jeff, the ceo of southwest was on cnbc this morning saying

that it wasn't essentially just a bluff, talking about moving away potentially from being boeing exclusive do you think airbus has been making inroads there with a customer like southwest? is this a real opening, do you think, to get more business? >> well, i'm not going to get into specific campaigns, but i will say this. we believe we have the right product in the a220 and 320 but specifically the 220 so fulfill the needs of a number of airlines, and southwest fits that grouping. so we continue to have close relationships with all the airlines, and we have conversations, but i certainly wouldn't get into those discussions publicly they want to get the max in the air and we respect that. >> longer term, people still wonder if this duopoly ever gets

busted by a large oem that comes to market with a competitive product, namely the "cheers. chinese i wonder how farther busting into this two-way street you've had with boeing for several decades. >> well, one, they have an airplane that they hope to get certified within the next year or two they are a real competitor in terms of their ability to innovate but on the other hand, we need to get better every day. we feel we have terrific products we need to continue to innovate on those products and make them better it will take anyone time to get into this market in any significant way. when you think about the numbers of airplanes necessary to displace a major competitor, it is significant but we take the chinese threat

and other threats very, very seriously. that's why we put so much money into r&d and relationships and ensuring we're bringing the best possible products forward. >> you just mentioned the a220 we had reports last week that lombardi is considering leaving its venture with airbus around the making of that aircraft carrier, rising production cost, the company is cash strapped dealing with issues including its transportation business. what's going to happen to the production of that aircraft, which is made, at least some of them, in the u.s.? >> the production of the aircraft will be unaffected by changes or potential changes in share holding. we continue to produce the airplane in maribel and we will be producing airplanes for u.s. in mobile. we will have that facility finalized in midthis year. and we will start -- we will be

delivering airplanes that the point. so changes in the shareholders will not affect the actual production of the airplane itself >> i want your thoughts on the supply chain as well this boeing production malt this ha -- halt, you use some of the same suppliers does it enable you to push suppliers to make components more quickly given the fact there's maybe more xcapacity on their end? or is it something that concerns you given the fact the locker that halt drags on you could see some of these companies in more questionable financial positions? >> the reality is the industry is better if we have a healthy supply chain these types of e e havenvents, different supplier to supplier, but generally these type of events are not helpful to the supply chain you saw spirit had to take some action with their workforce.

and that does create issues. our view is that we are looking for a healthy supply chain and short-term issues that have come up that negatively affect the supply chain are not a plus for us or anyone else. we are looking far he ing for a supply chain that continue to grow as i mentioned earlier, we have a huge backlog we need the supply chain to come along and to grow with us. >> so, jeff, i also want to shift gears and get your thoughts on the outlook for defense and space given the fact you have a defense business in the u.s. and also a commercial space business including the satellites you're making with one web. what do you expect for this year and beyond >> specific to defense and space, we've gone through a bit of restructuring in our defense and space business here in the u.s. and globally. when you look at the global

construct or the ceo of our global defense business has talked about some of the actions that need to cur but our view is that we have some terrific products and with those products we think there will be some interesting opportunities. specific to one web, we think we are a leader in the leo constellation and because of that, that is creating opportunities already for us in terms of customers and interest in the product >> jeffrey knittel, thanks for joining us today >> thank you >> meanwhile, 2019 was a big year for unicorns or private companies valued at over a billion dollars. could this be the end of that era? we start the call for nominations for this year's cnbc's disrupter 50 list, julia boorstin has a look at a new trend. 36 unicorns landed on the

2019 disresulter 50 list but the performance of some of the biggest ipos last year as shown that raising billions of dollars pre-ipo does not necessarily translate to public market success so the era of the megafunded private company could be threatened bill gurley tweets increasingly seems like we are entering a new reality in unicorn land. if you have raised more than $250 million and are not public, the presum sgs you are losing way too much money and you probably have -- i'll use the word poor, but he used a different word -- unit economics and probably need to do a layoff now, take uber, the biggest ipo last year. it raised $14 billion before it went public. the stock has lost 17% lyft, the second biggest ipo, raised $5 billion before going public its stock has lost 34% in contrast, one of the lowest valued companies on last year's

list, progeny, having raised just $93 million, it's seen its stock double looking at companies that went public last year trading below their ipo price, they raised an average of $774 million in funding. those companies trading above their ipo price raised less than a third as much, $209 million. this year we may see airbnb pursue a direct listing like spotify and slack did, to enable them to start trading without raising money. you'll likely see companies going public focus more on profitability and investors focus more on valuations nominations are now open for this year's disrupter 50 list. go to ruptecnbc.com/disrupters. amazon is a hot topic. eamon javers has more.

>> the white house spokesman was asked about the allegations that saudi arabian leader mbs hacked jeff bezos' cell phone here's what he had to say about it >> saudi arabia is obviously a partner and ally i'm aware there are reports. i don't have any more information than that. we obviously take those situations seriously, and so when we have something more i'll let you know >> he says the white house takes that situation seriously, but starting his comments there with the phrase that saudi arabia is obviously an ally not a huge register of concern here on the part of the white house. obviously, bezos is somebody the white house views as a political enemy, but the white house is not going to be able to dismiss this entirely because there are reports that jared kushner, the president's son-in-law and senior adviser at the white house, himself engaged in whats app texting with mbs there will be some concern on the part of the security forces at the white house that there may have been a similar attempt on jared kushner

they'll want to examine that as best they can. no indication from the xwhous that anything like that has happened but of course when you see mbs hacking prominent people, you'll want to look at it at the white house as well. >> thank you, eamon javers markets back in sell mode. the world. markets back in sell mode. below 29k. "squawk alley" is back in a few moments. more lugging your clubs through the airport or risk having your clubs lost or damaged by the airlines. sending your own clubs ahead with shipsticks.com makes it fast & easy to get to your golf destination. with just a few clicks or a phone call, we'll pick up and deliver your clubs on-time, guaranteed, for as low as $39.99. shipsticks.com saves you time and money. make it simple. make it ship sticks. shipsticks.com saves you time and money. car vending machines and buying a car 100% online.vented now we've created a brand new way for you to sell your car. whether it's a year old or a few years old, we want to buy your car.

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now for a story hopefully everybody can relate to. a shower head company backed by the likes of apple ceo tim cook and former google ceo eric schmidt launching a new product this week like its predecessor designed to use 45% less water than the average shower head unlike its predecessor n the neighbor of $200 as opposed to $500 with us, post 1, philip winter >> good to be here. >> this is in partnership with moen you are doing a kick starter at the same time. explain why you are doing a kick starter when you have a partnership and big backers? >> we started on kick starter four or five years ago it is a community that gave us life it is an amazing way to bring a new idea to the world. because you get all of these people who are interested in something that will back and you give you feedback.

it is our way of gratitude frankly it is a new company and we still need the funds and early volume to get it off the ground. >> this isn't digital. this is physics, i guess early on, you put them in a gym in the bay area. >> yeah. >> for people to tryout. one of those people ended up being tim cook he is coming out of the locker room, i guess, and you ask him for feedback he ends up investing is that really how it happened >> it was how it happened. venn dipty, six weeks after moving to the bay area early in the morning i was coming out of the women's locker room after installing a proceedo type there, and i saw him on the bench press ten feet away. he just saw me come out of the locker room. this means he is going to take a shower. >> how much was he benching? >> i don't know because i was doing the install. >> did go. >> he was one of the first people to try the prototype. it was pretty basic. but he got the idea, tried it a few days and believed in what we

were doing and became our first investor. >> what is different what makes it work >> we atomize water. we borrowed from rocket nchbs breaking streams of spray into tens of thousands. it is like steaming. but it feels like a rinse. it feels like ultrahigh definition tv as opposed to standard tv. >> how many have you sold. >> over 20,000 units, 55 different countries, pretty much all on line. saved a couple of hundred millions gallons of water. it is like our tesla model 3 that's how we are going to have an impact. it has to be in millions of homes save billions of gallons of water our partnership is fundamental the ceo flew across the country,

took a test shower in the shower in our office. came out after 30 minutes and said let's go ahead. >> i have been to the test shower it is an interesting product, philip, thanks for being with us. >> hopefully everyone will check it out on kick starter >> yes thanks. dow is down, on pace for the biggest weekly decline since late september and maybe, i don't know, there is chatter about growth scares once again as copper comes off of some high levels, ten-year yield down below 172 and the canaries in the coal mine will continue to come after the bell with intel. >> yeah. >> after getting the news from texan last night, maybe a more condensed space sectorwise but looking for guidance on supply and units. >> supply, exactly they continue to be in this constrained environment. because of their own planning issues, holing back the pc market in general.

we will watch that other chip players, western digital, now up more than 3% other chips on a bit of a run. >> yeah, transports turning positive earlier this hour a number of those names reporting earnings this morning. >> skyworks along with a fit balance sheet which remains integral to the market's direction some argue with all that, let's get to the judge and the half. >> carl, thanks so much. i'm scott wapner front and center the great debate about stocks. is the rally too stretched or is it capable of climbing even further it is a question every investor is asking. it is 12:00 noon, we are answering that question on the halftime report. >> fears about profits and stretched valuations the one big factor that will determine where stocks go from here earnings and upgrades. the biggest chip names on the move the traders take their positions. ge rallying on a bullish call should you buy in?