falling. we'll have an exclusive interview with the company chairman it is wednesday, february 24, 2020 "squawk box" begins right now. >> good morning. we are live from the marketsite in times square. i'm becky quick along with joe kernan and andrew ross sorkin. the two-day losses brought to nearly 1,900 points. the largest point loss for two days we have seen in history you are still talking about declines close to 7% over a

couple of days over 8% if you are looking at five days. if you were expecting a quick pull back, you are not getting it s&p futures are off by 8.5 nasdaq off by 31 all three major averages have lost all three of the gains for 2020 so far. we have looked at treasury yields so far. >> if that goes up, a tick higher we'll take anything. it is hard to take the big drop when you have one day at 22% keeping things in perspective. our top corporate story. disney ceo bob iger is handing offer the keys to the magic kingdom immediately. >> he's not going anywhere

>> i have a theory >> this beautiful succession is so orderly it is weird that it comes down to, oh, i'm leaving today. i want to hear what you know and some of your water cooler scuttlebutt. and go wild. my son informed me yesterday, bob iger is stepping down. replaced by bob chapek he's been there a long time. head of the global parks unlike nbc universal he's not a content guy he's a parks guy we think of it differently at comcast. parks are important but it is a

secondary thing. >> i would argue both nbc universal and disney have been very good as coordinating those parks. they are very much tied in >> are you surprised the parks guy will run the entire thing? >> yes >> he will report directly to iger who will stay on. he will report to iger and the board. so his contract goes through the end of 2021. he had been ceo over 15 years overseeing tremendous growth with acquisitions of pix ar, fox, lucas film. in an exclusive interview, iger explained his decision >> we looked at the businesses and felt we have a great set of

assets and strategy. what is next for my own strategy is making sure the creative pipe lynn is really rich and our creative engines are working extremely well i wanted to spend more of my time on that >> i'm not sure i want to be ceo during coronavirus either of a theme park >> here is my thought. bob iger in the transaction. rupert murdoch stipulates he has to be there. prevents him from running for president. and others suggests that this is some kind of enter ray to bloomberg/iger -- i'm taking that off the table that's crazy town. however, he's still going to be

in this place. becky said it. he's not going anywhere. the two bob's are running the place. the new bob doesn't work out for whatever reason, bob iger is still there. he's seen many transitions where people are sitting and waiting it is possible, i hope for the new bob's sake, that it works out. we've seen the story at salesforce yesterday where the new ceo didn't work out. kevin block didn't work out. another kevin could step up. to me, the big question mark if you are kevin maer running disney plus, do you stay in this spot because you were thinking you were getting the top job those are the discussions around the water cooler >> also what happens to disney plus if he's not there

>> if kevin maer is not there? he just stepped into that job. >> my point is, you want a happy person running that. >> did you have any dirt >> the only dirt story that has even been speculated is that the new bob might have had a job offer and one. reasons they wanted to do this quickly was to lock him in rather than let this persist in terms of transition -- what's the reason if you said six months, what is the difference >> the difference is that people will say, what's going on? why do it that way >> as things come up and things

leak if you are worried there is a leak coming. >> the stock was nowhere near where it was after the disney plus >> it got very expensive >> how bad could the numbers be? >> i don't think bob iger is stepping down. if parks don't work or if disney plus doesn't work, it is still on his watch even if he announced he is leaving tomorrow.

>> company plans to make first commercial flight early this year the chairman will be our guest in the 8:00 a.m. hour. we'll talk to him about that story. >> 8,000 people want to do this. you are not one of them, right >> i'd love to do it maybe after 80,000 people do it. >> i don't know. your four seconds of weightlessness >> i went to a conference where they had those planes. i never did that >> karl did that

i couldn't. >> i watch you get into your chair in the morning and you get motion sickness. lowes is out with earnings the numbers look good. 94 cents a share better than the street was expecting. sales came in at $16.15. they are talking the estimates for the full year. they see $6 on an adjusted basis. to $6.45 the street was above that at $6.67. not a huge reaction now. you are looking at that stock down about 25 cents. joining us now with his reaction, brian nagel. what do you think about the guidance >> overall, the report is some whatmixed.

that 2.6% comp in the further quarter. home depot did a 5-2 significantly less lowes did call out and talked about this a pure storage comp. they don't have the on line portion working yet. >> home depot said yesterday on line sales were up 20.8% that represents call it less than 10%, 8% of sales. >> lowe's point is not that we aren'tcounting we don't have

anything to account for in e commerce, it is a mess >> it is not operational at this point. that 2.6, if you assume a normalized e normalized e con, that would get normalized >> looking at comments, though we are only one year into a multi-year plan. believe we are well positioned in a market. >> i do. we've been talking about lowes i like it. it was a real mess he came from home depot to clean it up. there has been progress here the other thing is the operating margin expansion significantly lower. >> i found this on the web for guidance is the operating

margin >> you got a call there too. stephanie, do you agree with that >> i saw last year a big shift from lowes to home depot last year, i think the dynamic was that there were a lot more people favoring lowes over home depot. i think that turns this year we are seeing results kicking in that is sad at 23 timesforward that's not cheap while i think lowes can see a turnaround, they are way lind in terms of home depot. there is a lot they have to fix. >> stephanie is with us much of the morning. brian, thank you for coming. >> looking at a 32% drop of the

dow. yesterday, we were at like 100 in the middle of the day, when someone says who runs the section of the cdc focusing on respiratory disease and they say it is not a matter of if but when, we watched the markets reacting >> and the comments of saying we have to get used to quarantine and school issues. for a while, we are hearing from others that it is contained here the part of the cdc says get ready for community spread i wish he'd take it back and hope it doesn't. >> i would like to see more kits. >> we can't do it.

>> you can't buy the as beings on amazon. >> i have been stocking up on water, canned soup and frozen stuff. we have to feed the kids if we are stuck at home. i don't think it is going to happen but if it happens >> if it happens five blocks from here, the whole city shuts down >> i have to read this they worked hard on this we started out with markets in turmoil. pandemic fears fuelling the two-day selloff on wall street sorting through some of the biggest stock losers of the week they are slowing down on depressed market activity. not just on the dire fear. >> american airlines down 17%.

>> don't miss the big lineup starting at 8:00 virgin galactic. leon cooperman will join us. all coming up. stay tuned new york state is building for the future of your business.

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welcome back quote, this might be bad that's the cdc warning now saying they expect a wider spread in the united states and are preparing for potential pandemic warning for businesses, schools and communities to brace themselves not a question of if the virus will expand to the united states but when trump has expressed being furious about the stock market dive here is what larry said. >> based on the numbers we know,

atlanta fed gdp now 2.6% for q1. that could change. all these regional federal reserve reports are not hearing chatter and there is no evidence yet of any supply disruptions. >> amid those new warnings about the spread in the u.s., a look of how the chinese are weatherering the crisis. we want to talk to eunice yoon about how now that it feels more real here to us. i know we should have always been thinking about it this way given the polite ylight you've dealing with

>> new infection cases have been dropping here. today, in the chinese capital, announcing all super markets have to make sure their customers stay five feet apart from each other. the end result is that people just don't feel like shopping. >> before the coronavirus outbreak, he barely stepped in his kitchen. now he won't leave it. he is holed up at home and only spending a third of what he used to he would eat out at restaurants ever day, come to this theater and travel on vacation overseas. now he watches tv, reads books,

edi edits videos i leave maybe once every three days to get groceries. >> you come to shopping malls and if you are not feeling well, the star kwaquarantines you here >> once this is over, he plans to buy a bigger fridge when the cinema is open, that means it will be safe. my guess is that will be summer if the world economy can wait that long. >> the expectation is that demand will be later in the year other people said they are holding off to buy a new car at the same time, there is just

genuinely lost business. there is only so many meals he can meet out to make up for lost revenue at those restaurants >> eunice, you are one person i follow more closely than other yoon tv i follow very closely. about your life and the latest important news as well i was confused about the shopping customers are being told do not go near other customers. i can't realize how that is possible >> there have been concerns about people standing in line and getting too close to each

other. beijing said they have to ensure people are spaces out. so five feet in between customers. thank you, we are down 7%. maybe 8 or 9 total from the highs. there are plenty of companies in correction territory joining us now, jeff mills, chief investment officer and cnbc contributor and stephanie continues with us. in your view, jeff, does this feel like a 10 to 12% garden variety caused by coronavirus fears or do you expect it to be even longer lasting?

>> it is reeally hard to know. right now, we are within the confines of what would be considered a normal correction on any given year, about 12% would be a normal draw down. i would say we are not quite at the bottom yet doesn't quite look like capitulation yet to assume that this is going to be contained might be going too far. it was tweeted over the weekend. there is a chinese soccer team flew out of shanghai, tokyo, l.a. to brazil no testing at all. i think we'll see more headlines that shape the market in the near term. we have to assume that for now

>> there are 1.4 gazillion people in china and only couple thousands infected they are con continuing taining but there are the he ceconomic effects. >> we just don't know. social media isn't helping the setup was poor we thought that this was contained to your point. there is more questions. it is hard to quantify what this

is going to mean in four, six, eight months, it will be contained. i'm looking at companies that have been hit very hard. not necessarily technology stocks some are up 10%, 15% looking at some of the companies and consumer stocks. travel related names, if you can get these stocks at the yield, 4% would be ideal. i'm picking away at those. >> jeff, have you noted that the move down was led by growth and value was even more attractive for a double whapy at this point. is that how investors should be looking at this?

>> that's the case if you look at how markets behaved since last thursday, if you look at names like apple, moft, still 20 to 30% above averages you can certainly find opportunities. looking at dr horton in terms of housing. materially lower interest rates. look at places like energy maybe you need to be patient a name like shanier, valued just those contracts at 66 per share. there are areas and pockets you can look for now, if thinks start to deteriorate more, that growth is maybe not the safe haven it was a fewweeks ago

>> thank you we've had more action in these averages that can get you going a little bit. >> that plane you are talking about is the vomit comit >> you've thrown up on any kind of vehicle >> everything but a golf cart. >> the dow is up >> the rsi on the s&p is 29. pretty oversold. >> there is i difference between fear and oversold. just because you are scared to death doesn't mean you are necessarily oversold yet

quality on sale. >> i like that coming up, more to talk about. shake-up at sales force. expected successor to tstep dow. more more in the sell-off on wall street. $1.7 trillion wiped out from the s&p. take a look at futures now marginally better than where they were. s&p 500 up abo 1potsdout0 in, w up about 60 points, dow up we'll see when we return after this when i lost my sight, my biggest fear was losing my independence.

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welcome back shares of salesforce under pressure the co-ceo keith block is stepping down. as a result, mark will be sole ceo. he will stay on as an advisor for a year salesforce reporting beating forecast dynamic change there as you were saying, he was the

face to wall street. people trusted him on terms of the numbers and what the company was doing. i think the expectation was that mark would become chairman of the company. awf all of his other projects. >> party planning in davos that's what he does. >> endeavors the expectation was that keith block would run the company. >> i'm disappointed as a share holder because transparency goes down dramatically because block was the face now is not the time to leave, i don't think. >> he manned the door himself. >> when we come back, dow futures have been swinging back

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. good morning welcome to "squawk box" here let's show you what is going on with the futures especially given the last few days of carnage in the markets showing you where things stand right now coming off the nearly

1,900-point sell off it looks like we are in the green for now. dow looking to open about 11 points higher, the dow about 70 and the nasdaq just higher >> kind of like the weather right now. in the democrat debate, they attacked front runner bernie sanders. we have more on what is happening. >> reporter: at times a chaotic debate a lot of talking over each other on main issues. >> i'll tell you what the american people want, they don't want candidates to be running to billionaires for huge amounts.

>> if you are watching right now and you are a billionaire, i will raise your taxes. if you'd like to debeat donald trump, please donate the legal maximum. >> reporter: the candidates were asked how they wouldstop the spread of the coronavirus. joe biden said he would use it as an opportunity to confront china directly >> i would be on the phone with china making it clear, we are going to need to be in your country. you have to be open, clear and we have to know what's going on. we have to be there with you >> reporter: president trump responded quickly over twitter defending the administrations decision to close border from travelers. it was opposed by democrats who said it was too soon but turned out to be the correct decision

president trump will be here in south carolina holding a rally i expect a lot more shouting before the week is over. >> we get a lot of complaints on the show of talking over each other. that was my complaint last night. when i want to say something, i'm going to do this year. >> everybody went over time too. >> can i applaud from the sidelines or boo you >> tech stocks among the hardest hit. we'll talk what p it means, next yes. it's the first word of any new discovery.

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>> the coronavirus outbreak is hitting chip stocks. down 10% in a week following a strong rally joining us now, strategist at wolf research. supply chain fears from china affects a lot. chips are always kind of a leading edge that moves before one way or another why is that? >> it was funny.

stocks move early. they were sensitive with things like chip prices back after a big move. we've seen it. when you look at mid-january semis and hardware stocks hit strategies they may have been right for the pull back anyway tech has been huge fairly narrow. i think it is ripe for a pull back there could see some down side tech is not oversold as the

market you probably haven't hit a bottom there is problem more to go. >> what would be the indication to you that the lows were in >> you want to see the virus play out i was concerned the stock wasn't hit at all you've got a number of companies hit yesterday. they said they were 60 to 70% strategy a little concerned that china is sending people back to work when they don't have containment yet. could this create acceleration of spread. you want to see the supply chain stabilize. >> you gave me the numbers on what cot depth could be. what do you think the duration of this whole process could be

>> companies were already saying two to four weeks. maybe four to six. the f1 race in april was canceled it could take us to early to midsummer and then hopefully things will get a lot better >> okay. when we come back, grubhub stock plunged in october since then, the stock has marched upward the company ceo here to talk about what is next futures now indicating up by 100 points 1,900 points off the session for the dow.

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welcome back to squawk box could growing fears of the coronavirus lead to more consumers staying home we'll talk about that and a lot more taking place in this sector joining us right now grub hub ceo. good morning to you. >> good morning. >> let's start with coronavirus because everybody is talking about it and trying to understand what it would mean and there's conversation about certain types of companies that oddly enough could benefit in terms of people staying home and trying to get their food brought to them. >> we'll see i have no idea coronavirus is a scary situation. i believe the scientists and when they're talking about pandemics i'm wiping down my airplane seat every time i fly

we are very much paying attention on a local level we have a problem with demand and how has it worked? >> it's very hard to draw anlages from china to the u.s. was it's a completely different market in the states it's a different system of delivery so i would be very cautious to draw parallels between what's happening over there right now in a crisis situation and how that would impact the states we're paying attention on the ground and seeing how it's going to impact our restaurants and our diners. >> is there anything you're doing today beyond studying and looking at the numbers and

things what you would do. >> we have all of our sensors up we're paying a lot of attention. >> i didn't know if there's anything to do. >> there's nothing to do right now because the cases haven't -- i mean, we're not having an epidemic in the u.s. yet. >> would you imagine that prices would go up. >> i have no idea. prices would be a function of supply and demand. >> you'd have two issues the restaurants in terms of they might want to raise their prices because they might want to incentivize their staff to show up and you might have to try to incentivize drivers and delivery people to show up in the same way it takes place on uber you need people to be in a particular area. >> i know that you don't but absolutely, i have no idea how an epidemic is going to impact our business and pricing

you look at the chart that's upright now and you can see what's happening tell us everything that's happened since then. >> absolutely. so in our third quarter we had a shareholder letter that reoriented the industry around the new reality. what was happening is there's too many competitors spending too much money and losing too much money so we pivoted our strategy to be aggressive on supply and aggressive on incentives and that's exactly what we're doing today with the launch of our grub hub plus membership program it's an order of magnitude more exciting than any other program that's out there the free delivery is there and that's what it is right now and we have 10% cash back. which is really incredible what has to happen to the rest of the business? and i should note by the way the head of uber eats just stepped down yesterday. >> i saw that

>> we're able to lead into the profit and 10% cash back and double the donations and that's part of the membership program. >> is that an effort to put post mates out of business? >> i can't impact their viability as a business but i can absolutely impact. so what we're doing is leading into our profits at a time when everyone else is fighting to find break even. they're trying to battle back. >> that's my question. when you salining into your profits, are you willing to take lesser profits to try to

consolidate market coverage. >> yeah. the stock dropped because we said we're taking our profitability from where it could be near 200 million a year down to 100 million a year we're taking those extra profits and using them hyper competitively and we're trying to steal shares. diners and other platforms. >> were you looking to buy one of these other companies >> am i looking to buy >> yes. >> we bought ten companies in the past ten years this is part of our growth strategy so i'm very opportunistic this year. i'm just trying to be as competitive as possible. >> which one do you worry about the most >> there's a lot of of companies moving a lot of money and the industry is ripe for consolidation. >> good answer thank you. nice to see you. we wish you lots of luck. >> thank you. >> coming up, when we return, a lot more on squawk one of the most discussed companies of the last few weeks, virgin galactic. the chairman is gointo jg oin us

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>> it's not a matter of if but when what a city quarentine here in the united states would look like. >> plus bob iger steps down as ceo of disney. he is now the soul ceo of salesforce and elon musk parts ways with panasonic. the second hour of squawk box begins right now take a look at u.s. equity futures. dow open down now by 11 points

and which way the wind is blowing it all could change. they expect the coronavirus to spread and brace themselves and plan for potential outbreak and saying it's not a question of if the virus will expand but when in italy there's confirmed cases and 11 deaths and they're now being seen beyond the original epicenter. and a jump of 169 new cases bringing the total to 146

infected and 11 deaths china, beijing will quarentine people >> many investors want to know if production is picking up in china. steve is looking at alternative indicators. >> so the top line data that joe is talking about shows growth of the virus while it continues to spread outside of the nation >> similarly coal consumption is not close to where it usually is that's a big deal in a country that gets 60% of its power from

coal all of this is against hopes that china would be getting back to work by the end of the month. the knock on effect of the u.s. could be worse other data includes shipping, real estate transactions,down 90% and pollution all of which are down from their averages in this case it's a sign that factories have yet to recover and the economy has aways to go before returning to full health and this endangers the base case scenario of economists that look for this to be a first quarter event. increasing now we're hearing this may bleed into it here. >> steve, this is something that we have been hearing about the mixed messages they say go back to work and they say increase the restrictions that you may have trying to get in and out of your apartment complex. they're saying no more than four people can get in an elevator. they tell you to go shopping but then you're told don't come within five feet of anybody and all the mixed messages left

people concerned. >> the firsthand reporting by eunice is second to none she would get it before i got it but this data we're tracking is in real time it's still running from 10% to 50% below. one of the things you see is the pollution he quitted by automobiles is down but maybe pollution from factories is up more so it may be that people are going to the factories and not going home and staying at the factories. it's somewhere in mid march. >> so 1% or 1.5% gdp china growth. >> that's what we're hearing with a knock on effect to the u.s. anywhere from .5 -- that would be a median cut that i'm seeing in the first quarter. the issue that i'm talking about here and i think the issue is when do they put that back in?

because it was spt 5 down and it w was.5 up it's a question of when do you look for the return to growth. >> he was talking about the 1 to 2% gdp number over a week ago. we'll talk more about this right now. put this in context. the stock market sell off wiped 1,900 points off the dow in the last two sessions. the s&p 500 lost $1.7 trillion in market value over the same time period. he is the chief investment officer for the americas at dws group and covering the economic angle is joseph, the global economist at jp morgan and welcome to both of you let's talk about this. if you try to extrapolate what this news for the united states base on the numbers right now, is there anyway to give some summation of what we think at this point >> you want to think about the depth of the downturn and then the magnitude of the rebound

the longer this lasts the more it turns into a downturn inventories can absorb the hit in the u.s after awhile you start to run out of the inventories and get real knock on effects. >> are we up against the line yet or no? >> not yet but forecasts keep being revised. we marked ours down to minus 4% for the first uarter. >> quarter on quarter and annualized. >> correct. >> you're seeing a negative. >> has that ever happened? >> not a minus 4 if you look at the sars outbreak you went from 9 to 10 approxima10% down. >> did you get the second quarter rebound? >> yes we have it up 15% annualized in the second quarter. >> you have 15%? >> again quarter on quarter annualized. >> just to be clear but joseph

is the source of some of the data they have created a daily indicator of the things that i'm talking about along with the other shops that are out there so given that your data is showing this flat line on some of these things, does that seem right to you >> when you look at this it's not just looking at things still depressed. it's looking at where the bottom is and are we starting to march our way upward when you get a big hit in the first few weeks of february and that's extending through february, maybe even starting to get into early march, if you get a rebound that's happening, even if you're still down 30%, if you were down on 50% that's a 20% move that starts to impact growth not just in the second quarter but even in the late first quarter. >> so more stimulus coming out of china >> that's a good question about what is the policy response. no doubt that physical policy is the lever being pulled and we have upped our sense of fiscal

thrust in china by as much as -- we were at half a percent to start the year now upwards of 1 to a little over 1%. >> let's get to david. what does this mean from a stock market perspective and the declines we have seen the last two sessions make sense to you david? >> from a stock market special circumstance tif, first you have to understand that we have been paying close attention to this we look at the importance of the chinese economy to the world and china to global manufacturing and china to commodity demand and oil demand and what we see is a clear impact to profitability of multinationals around the world including the united states. but half of that is at risk. and one last thing it's always about trying to figure out the channels

whether it's commodity prices or supply chain or investment spending but currency is something to watch here and if the fed doesn't open the door at the march meeting to a cut and probably follow through with one by the spring, we think you're going to see a much stronger dollar which is only going to exacerbate the situation. >> here's the question investors are waking one this morning. yesterday we had been down 3.5% at that point. the futures were higher we're now down an additional 3%. the s&p is off 8%. do you buy this dip? >> no, not yet it's going to turn into a full blown correction and it's not -- it's a material impact toward earnings outlook and it's probably going to be another year of earnings growth and especially a challenging year for energy, industrials,

materials, retailers, all of those value stocks that so many investors were rotating into and that was a mistake and we think this market needs to reprice. >> do you agree with that? >> well, i think it's impossible to time. so that's why i think you have to look six months out and really think -- >> you're not looking at the major averages anymore. >> i can't that's not the way you invest. you look at quality companies and you focus on fundamentals and see if there's any yield support at these companies so down 11%. 3.3% and mondelez, loved that acquisition yesterday that they did and they're doing such a good job internationally i think they're going to monetize their coffee business. so there's a lot of names out

there. just small pieces. >> if i -- >> we seem to -- >> hold on, hold on. i want a show of hands of who will take 10 to 12 right now if we can quarentee 10 to 12. >> you can cap it at 10. >> and number two you say no i wouldn't buy now why not? we're down ninement you wouldn't buy now? you must not really believe it's only 10 to 12. i wish i could know for sure do you really believe it's only 10 to 12%? >> we always look at our forecasts and we're close enough to stick with true quality companies and true growth economies and true virtual economy companies and there's no safety in energy i'm beginning to envision between the politics and the

com.d.ty price situation -- >> i'm worried about 20% down. >> me too. >> this comes to new york city in any meaningful way. >> we're talking about. >> how could it not be here now. >> this is a good sign that we're scared to death. this is good. >> and then the market is going to -- >> do we have another special tonight? >> i imagine that's a positive as well. >> they're not going to respond just yet >> they used the same language that it used in the past saying that they'll do something if it is warranted. >> but we have plenty of room. we have like three cuts we could do >> is this the moment for sarcasm. >> that's another worry. >> the probabilities were down. >> this is with a you said that we have nothing in the tank if we need it. >> i never said that. >> we're too low it would be nice to have more. >> a 45% probability of a third cut now built in and it's

interesting. how do rate cuts solve supply problems i don't think the fed can either create a vaccine or create a supply and put those people back to work in china. >> liquidity where liquidity is needed. >> that's true. >> i would only point out -- >> go ahead. >> well, i was listening to ste steve. i don't mean to interrupt. the dollar is already expecting the fed to act by easing and if the fed takes the stance that the u.s. economy is so insulated from this virus i think you'll see a stronger dollar and that will hit commodities harder than you could imagine. >> gentlemen, thank you for being here steve, we'll see you later david and joseph, we appreciate your time. also, stephanie thank you for being with us this morning it's been great. >> it's fun. thanks. >> let's also talk about treasury yields because they are

plunging the ten year hitting a new low in which in-turn will push mortgage rates lower the latest report on mortgage applications. >> it was a mixed bag for the mortgage applications because rates didn't start to fall until the end of last week so total volume rose 1.5% for the last week that's according to the mortgage bankers association and an adjustment was made for the president's day holiday. now the average rate on the 30 year fix did fall from 3.77% to 3.73%. but the drop only started on thursday so applications to refinance a home loan they actually fell 1% for the week but we're still about 152% higher annually because mortgage rates are a full percentage points lower than a year ago. refinance volume will very likely increase much more this week because rates on monday fell to the lowest level in 8 years as the market sold off over the coronavirus

now to purchase a home increased 6% and were 10% higher annually. purchase volume has been weaker due to the incredibly tight supply of homes for sale but builders are seeing big demand and mortgage applications for new homes are way up last week was the calm before the storm. >> thank you on the earnings front, lowe's reporting in the last hour, the home improvement i'm reading. on camera. the home improvement retailer adjusted -- we saw that spikey hair that could only be one person. 3 cents above estimates. however revenue was below wall street's forecast and comp store sales rise of 2.5% was below the consensus by quite a bit it was 3.6%. >> when we come back, disney's

bob iger stepping down as ceo handing over the reigns. he's still going to be there as executive chairman for the rest of the year. what it means and what you need to know about the successor coming up. >> before we head to a break, a check on shares of tesla this morning. the stock is back below $800 decline of 2.3%. and down over $100 the it's been a rough couple of days overall. this morning a report says that tesla and panasonic are ending joint production of solar cells sqwkoxilor new yk. ua b wl be right back. memory loss related to aging?d prevagen is the number one pharmacist-recommended memory support brand. you can find it in the vitamin aisle in stores everywhere. prevagen. healthier brain. better life.

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we won't call it anything until we get to the opening and then the close. >> right now 30 points higher. nasdaq up 12 points. s&p up about 6 points higher but an hour and a half ago we were

in the red. >> that's the conversation that everybody has right now. >> that's the real economy story which really becomes the market story. >> yeah. >> meantime, this is a plot twist for you. a surprise and sudden departure at disney. bob iger stepping down after nearly 15 years at the helm. during that timeshares of disney rose 440% while the dow gained 150% julia has more >> good morning to you that's right bob iger is stepping into the executive chairman role to focus on content until his contract at disney expires at the end of next year.

>> what's next and what was next in terms of my own priorities is mab making sure that the creative pipeline was rich and all of our creative engines were working well and i wanted to spend more of my time on that but the only way i was able to do that was to give up the day-to-day running of the company to pass the torch on to bob. >> now he passes the torch he expanded disney internationally with the launch of shanghai disney and new star wars lands he shifted the focus to streaming directly to consumers with a launch of disney plus and espn plus and he gave the company massive new scale for the acquisition of the entertainment assets from 21st century fox. now iger has grown and changed disney more than any prior ceo leaving his successor with big shoes to fill.

you can find my full interview on cnbc.com. >> two questions, one is one of the big questions in hollywood and wall street is the media sy -- immediacy of the announcement to effectively make the new bob the ceo immediately. did he speak to that issue and why? >> well, look, i think there's a question of why this is being announced now when iger's contract had been extended through the end of 2021. you know the board is focused on this issue of succession for quite awhile now expiring someone who could fill his role and remember there were many examples of people like people that were thought to be successors to iger that ended up leaving and raising concerns

about who could fill iger's shoes. so the idea is to identify who that successor would be and once they did identify him they wanted to give a period of transition where they weren't just going to have iger continue in the ceo role until he was replaced but i think he wanted to show that he did have confidence in the person. >> very quickly, second question, kevin mayer that's now taken over disney plus was often seen within the industry as the heir apparent. does he stay does he bolt what's the conversation there and how important is that? >> we'll see i do know one reason he was chosen was because of the operational experience where as mayer has only been running the direct to consumer business for about a year so that's a much younger business where as he was running

before that. kevin mayer has done a good job if you look at the really impressive numbers for disney plus in particular and the growth of espn plus so certainly i would expect that disney would want to hold on to him and i believe he is under contract although contracts can always be broken but certainly someone disney would want to hold on to for the company. >> thanks. look at that chart you saw it there i'm going to ask you some questions about this joining us now like 100 to 110 and 115. and we waited and waited and it broke out off to the races we're back down at the high end of that range but we have got

that on the horizon. with this news, do you buy disney since it's 128 and it's cheaper here is that where you want to buy it or do you worry about what's going to happen in the near term and then we'll get to iger and the other stuff but is this the place you enter disney. >> you're waiting for the negative revision to come. it's given up so much in the last two or three weeks this isn't an entry point for one month and you trade out of disney you're going to have negative revisions. but coronavirus will come and it

will go. >> for right now, they guide it to a hit for the fiscal second quarter and, you know, in terms of just shanghai hong kong and right now i sort of think if it does keep going and it spreads to the u.s. and start taking numbers down for disneyworld and disney land maybe that benefit goes away and people get a bit more panicked but i agree with him. i don't know when. when did we first start talking about iger a lot. >> he's re-signed and there was speculation about whether he was going to run for president and then the deal with rupert murdoch. >> so an immediate, leaving immediately as of yesterday, is it still an orderly transition

that the company -- will we study it 10 or 15 years from now and how to do a succession and this is well done or was it weird? >> the timing was weir. >> it was. >> the timing was not what we expected and not typical disney. you had a quarter two weeks agatha was a great quarter you could have done it on the quarter or waited for the next quarter and the i'ming wtiming s weird. why now, what happens to kevin are questions that everyone wants answers because it doesn't seem that the answers are solid. why now? it could have been two weeks ago. we don't have an answer for why now. >> does that bother you. >> yeah. it bothers me. >> it's not like he's going anywhere. >> that's why i don't understand why all the hubub. >> as analysts we like answers to questions does it bother you in term of an

analyst, yes. >> the k to. >> no, because he's sticking around. >> the announcement doesn't surprise me as much as to why it happens now. >> you guys are control freaks >> that's our job. we like to plan. >> we want to know why >> speculation was maybe he had a job offer. >> he was that valuable. >> was there some event. >> but you could have done it internally. >> is this a trial period? >> is this like a situation where he gets the job but with iger hanging around it could work if it doesn't, do you keep kevin and swap them out later? maybe this is some kind of -- >> is that a basketball? >> basketball hoop

>> i like that. >> he could get the 3 second rule and be out. >> is that what it's going to be like >> we hope so. >> i didn't think -- i go all the way back they didn't know what to do. >> do you like chapek over kevin? >> absolutely. >> more experience. >> more disney culture. >> but i seems like it's star wars now it's creative now. >> okay, alexia and michael. >> it's more than one. >> but it's weird. we usually aren't -- it's usually disney versus boeing. >> compartmentalized block by

block. >> disney versus imminent, horrific disease coming up, the cdc saying it's not a matter of if but when the coronavirus will spread in america and we're in times square what would an outbreak look like in a city like new york or chicago where if you are mandated to stay 3 meters away you couldn't we'll discuss that in a few minutes. here's yesterday's dow laggards. >> that doesn't narrow it down we'll be right back. >> time for toy'das aflac trivia question in what year did linkedin launch no. uh uh. is it homeowner's insurance? no...

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welcome back, everybody. the coronavirus has spread quickly throughout the mainland. it is on its way to becoming a

global pandemic and it's only a matter of time before the outbreak spreads here in the united states. meg joins us with more on what's happening. >> a new milestone noted by the world health organization this morning. for the first time since the outbreak began new cases outside of china exceeded those reported in china the news comes after the w.h.o. praised how the country worked to contain the outbreak but as news spreads europe and the middleeast raised alerts around the world. the cdc telling americans to be prepared it's not a matter of if but when it spreads in the u.s. school closures and working from home and cancellation of mass gatherings all may be possibilities. he urged calm as he says so far the u.s. appears to have contained the virus. he has two appearances on the hill this after democratic presidential candidates in last night's debate says the u.s.

needs to do better in preparedness. >> thank you joining us to discuss all of this is the assistant professor of medicine and the offer of super bugs, the race to stop an epidemic good morning to you. thank you for joining us i'm going to go straight to the question that we have all been asking ourselves, is it here already? >> we don't know and the reason we don't know is we're not testing for it we have done 16 tests a day. >> total in the united states. >> fewer than 500 tests. >> why >> the cdc came up with a test and sent it out to all 50 states and then said wait a second this is a faulty test so we haven't had something to work with. the good news is a new test is on its way and the most important thing that we could do is go out and test 10,000 people today to show that this virus is not actually here and circulating. >> but you would, if it was more than a really small number, you would expect to be able to

detect a background level of respiratory diseases. >> we would expect to see a big bump. >> and we haven't. >> we haven't seen it. >> so you're really worried and we need to do the tests. i did 200,000 tests already in china. so as you said we're not doing nearly enough. so are they going to ship out the new one? they have to ship out a lot of those things how many can we make >> somebody on thehillsaid they were briefed the new test was coming soon. i said how soon? they said we don't know. >> they wouldn't give you a days or weeks type of estimate? >> no, and the cdc hasn't given that information yet when can every doc in the country see a patient and order a test on the spot and i think the answer to that is going to be data will be crucial. >> has china done a good job quarentining people and do we with the amount of freedom that we enjoy in this country, are we capable of the same response that china has taken

>> that's going to be the billion dollar question because the quarentines here may be unconstitutional the question that we're going to have to address and we can only address with data is should we do these quarentines what we're seeing now as people are going to look at the repercussions of quarentines and going to check on the families that have been quarentined today they found a 6-year-old boy that's home by himself for days because he was with his grandfather that died and he would told not to go outside. >> but as a doctor that looks at outbreak control, is it an effective method. >> the world health organization said we don't support quarentines. now we know that it bought us time so there's been a shift in our thinking on it whether or not it should be done outside of china can only be answered once we start testing and we know the full scope of the problem and we don't know that yet but answers are coming soon. >> what's the scenario under which it works and which it doesn't? >> if you had an outbreak of

30,000 people in times square, you would want to quarentine if you only had three people, you would handle it differently. the data is also crucial for travel bans. if you have thousands of cases in the united states and only three cases in bahrain, you don't need to ban people from bahrain. >> by the time you figure out there's 30,000 people in times square that have it it's too late it's a 14 day incubation period. >> it could be longer than that. our understanding is still evolving but more data i coming. >> i know that you don't like to say things that are alarmist is your gamble that it is here or not >> if i had to guess i think it's probably very close to being here. >> very close to being here but not here. >> what does that mean >> that means that we have people flying all over the worldcoming in and out of times square and coming in and out of hospitals. we don't know the answer and it's a challenge for us to try to answer the question so is it here? we just can't answer that

question. >> do you have a better understanding of the actually mortality? since we don't know how many people have it we're overstating the problem, so it's probably not 2% mortality do you think it's .2 do you think it's .02? >> we're seeing an incredibly high mortality rate for people over the age of 80 we're also seeing young healthy people die so our understanding of this is evolving. >> what percentage of young healthy people though? >> very small. very, very small. >> but that looks like a problem. auto immune. >> that's correct. one of the interesting thing is it infected somebody in our military a guy in south korea the question is would we have been able to detect this case if he had been stationed in the united states? and the answer when we get these tests available is absolutely and that information is coming soon. >> and just to end on a positive note, your book super bugs is about something totally different that might kill us.

>> it's about all the other things that can get you after coronavirus. >> thanks for that. >> and the market is down again. >> on that note. >> thank you. >> coming up, when we return, the ceo of software giant adobe is going to join us and then later the chairman of virgin galactic and tech investor is going to join us for the hour. it's been a huge story stock squawk box returns right after this ♪

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home improvement retailer with a mixed quarterly profits were better than estimates revenues narrowly missed estimates and a couple of food stocks on the move today shares of wendy's to the down side about a percent or so 15,000 shares of premarket volume it matched wall street profit estimates and posted better revenue numbers and better than

expected sales growth and we're going to end on shares of papa johns up about a percent or so roughly 1,000 shares of volumes. had a quarterly trifecta better than expected profits as well so two red, one green. coming up, the ceo of adobe systems is coming up on squawk box. keep it here and check out what's happening to futures at this hour. they traded in a 641 point range. a volatile segment squawk box will be right back. (sensei) a live bookkeeper is helping customize

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[ fast-paced drumming ]

names are all in correction territory after the declines we have seen the last couple of days and adobe that had had a strong run to start the year is up 8% over the last week joining us to talk about this and more is the adobe ceo. it's great to see you. >> thanks for having me. >> markets watching the dow down 1,900 points what are you thinking as a ceo seeing what's happening? what is your take on the economy right now? >> i think it's all about the coronavirus and the human element of that is certainly tragic and we're all monitoring that but i think in terms of the general economy we're on the creative side, the notion of

creativity and design has never been more important so i think the fundamental drivers with et cetera artificial intelligence or machine learning or what's happening with 5-g i think the strength will continue. >> have you seen things shutdown because it looks like businesses ground to a stand still in china. >> well, where we are in our fiscal calendar, we end the quarter so we're not commenting on that specifically but actually our sales in china as a result of people using our produc products they're not as material as the other companies that have a larger presence. >> because a lot of people weren't paying for it to begin with it's not going to have as big of an impact. >> in particular china is not a material part of our business.

>> so, can you give us some insight? but trying to see through again, the stock market is like dropping everything right now. investors are dropping everything as we look at the global economy does that make sense from somebody that can see the numbers on a daily basis >> in terms of the uncertainty that this causes, you can clearly see why that might raise some concerns. but depending on how long this goes i think it's the duration and tenure i think it doesn't change fundamentally how technology is going to continue to transform every industry so i think the long-term secular trends are going to continue to be positive it's the uncertainty that everybody is focused on right now. >> here is what caught my attention. yesterday ubs raised the price target to $430 to 360. this was yesterday as the markets were in a free fall. there's been questions from other analysts they want to hear more about what you're doing in terms of business to business

i think it's crazy that people look at texts rather than graphics so i think using digital as story telling. >> photo shop beyond this. >> like spark that we're doing for every single student that secular trend continues on the enterprise side what we have done, we were the first company with how do you engage with your customers and i think the demand for that is how do you engage with your customers directly and everything with respect to direct to consumer, that's also going to continue. >> how is the move to the cloud going? that's what a lot of analysts have wondered as well. >> we were absolutely the pioneer in terms of moving from box offer and when we first did

that many years ago people were wondering what adobe was up to and whether it's the speed of which we can now innovate, the revenue stream, the ability to price differtially it's paid off in spades. >> how recession proof are you for both businesses and consumers? how core of a product is it the company has been growing at 20% we're continuing to do well. we focus more on are we

innovating with our customers rather than any external issues. how has that moved to try to get more to a situation. >> what was a b to c company and may be engaged through a distribution channel, that distinction is completely blurring so you want to engage directly with customers the procter & gambles of the world so i think both in terms of both providing us with that last mile on commerce and the ability for companies to engage directly with customers, both of them are really key parts of our acquisition strategy and rounding out our portfolio >> thank you for your time. >> coming up, the chairman of virgin galactic is going to join

us for the hour. plus the legendary investor joins us to break down this week's mkeart volatility all of that is straight ahead right here on squawk box how's the it department liking the now platform? every time it takes care of something for us, we celebrate. how often does that...

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sorkin and our special guest host, it merges all of the different culture verdicts it's good to have you here. >> we have more things going on. this is just one of them but compared to the last time you were on it is like why are you doing this pie in the sky type stuff next thing you know is stock is worth like $8 billion or something. it's a real thing. >> it's a real thing it was a real thing when we did it. >> we were talking off camera about he has to wait like everyone else to go up and you can put me on the weight list can i be like 10 millionth person to go and it's right over here

all over the map this morning. the s&p up and rebounding this morning. and earlier we were up the yield goes down to all time go >> let's tell you how we got here markets began in the green stocks were positive out of gate as you recall. and fortunes changed and indexes fell throughout the day with investors nervous and then the cdc came in saying it was spreading illness and pandemic

was likely and that everybody should get prepared. and the dow ended down and trillion dollars in market cap just wiped straight off the s&p 500. they're now in correction territory. and just continuing. and all time low of just 1.3%. the 30 year bond hitting an all time low under 1.8%. the most recent stuff is the virgin galactic.

and we have to just -- we all have feelings about coronavirus and the founder and ceo and also chairman of virgin galactic. and that's on everyone's mind when the market goes down. this is the very important thing. and it could be in the middle and all the people who are immediately carrying coronavirus all over the world and probably tells me that if

it's in the hundreds of thousands or millionth than it's akined to a flu. that's much more of a tractable thing because we know how. if the denominator is as low as it is but then the viral spread and coefficient is as past as we're being told it's a serious problem. it's going to shutdown not just how cities are but it's going to be something that we convenient in awhile. >> a responsible investment. >> i can't do anything about it.

>> billions of dollars no wonder you dress like that. billions of dollars of equity. >> it's true do i hedge increasingly i'm trying to just get relief. just remember that i'm not owning stocks. i own companies and as long as i can maintain some semblance of normalcy this will take 8 to 9 months to roll it's way through the marks and for the markets to rerate and right now if i can just

manage my own psychology. >> it means don't be leveraged. >> i have been meeting a lot of great folks the last three days here every time i come to new york i meet some of the best hedge funds and one of the things that really struck out to me this time around is how levered everybody is if they're running something more liquid like a typical macro strategy they're running 12, 13, 14, 15 times levered i have always felt like i have been on the wrong side when i see people printing these enormous gains and i thought to myself why am i being so conservative but in moments like this i feel really calm. >> you're the first-person that said that on the set there's a lot of hedge funds super levered up out there that caught you off guard. that sounds like a potential

problem when you have seen activities like we have seen the last couple of days. >> this is a bigger problem. so they try to have small exposures and then lever the whole thing up they're not hedged to begin with there's a ton of correlation and when things like this happen and everything rerates and you're running 5, of, 7, 8 times then it gets exacerbated. so the thing that we haven't seen is what if that happens it's fair to say that you'll go risk off and people will take money out of the market, that will represent the first maybe 800 points in the dow or the first 1,000 points in the dow. but it's just forced sellers. >> it's so exciting. >> we're getting news that president trump is going to hold a news conference. >> about >> about coronavirus at 6:00 p.m. this evening. >> i did ask him about that.

it was a glimmer in our eyes in davos. >> he has not been worried and he sent larry kudlow out to say he's not worried the cdc has a different view on that >> you have taken companies from a glimmer in someone's eyes all the way to where they're major companies. is space ahead of it -- is virgin ahead of itself have you been surprised based on the fundamentals >> can i take a step back and give you the set up? >> sure. >> it doesn't just apply to virgin but it also applies to tesla and those two things are actually the most similar stories. >> first let's look at the fixed income markets for the last ten years everything that has looked like a nail has been dealt with the following hammer

print money, cut rates trump tweets, print money, cut rates. and rates have gone to zero and there's trillions of excess capacity just sloshing around. and then the number of companies that you can invest in has shrank by a third. there's no growth outside of multiple expansion and no growth outside of buy backs so everybody crowds into the five technology companies. so when you put those two things together there is a set up with no real growth or unique stories and nothing that can give you long-term outlook so when a company comes along that has a unique narrative and trying to do something that's differentiated high margin and could theoretically grow for ten years where there's an enormous amount of con sumer demand, thes

things get repriced in ways that are non-traditional. >> sounds to me like you're saying yes it's a storied stock but that doesn't mean that it's not going to turn into something huge. >> i really believe in virgin. >> the goal is to fly on a commercial flight this year. >> this year. >> yeah. i think the point is that setting an arbitrary date for something like space flight is not the right thing do do. you want to move forward in a plan and not move backwards but give them the chance and opportunity to build a beautiful experience you want to be the 10,000th customer. >> you said the 10,000th customer. >> i said a multiple of 8,000.

>> they are making amazing progress working through the faa and the technical capabilities and flying the machines back down to new mexico and then on top of that, all of this demand keeps piling up. 124% increase in the number of people that want to buy tickets. we have started to accept prereservations. if those 8,000 people, just those 8,000 people it doesn't seem like a lot but when you think the price could be around 300 grand that's 2.4 billion of pipeline. >> is there an insurance program? >> yeah. >> no, for individuals. >> so if something tragic were to happen, do you know what the pay out would be relative to a regular airline? >> i'm just curious. i think that's actually -- i don't know what people think about it like that. >> i don't know but i know there will be a really robust insurance. >> very quickly, mike santoli brings up a good question. it was at half evaluation of 1.5 billion. now it's a lot higher.

is this overdone or did things just change that drastically. >> neither. >> you have to remember, we put $800 million into the business between secondary and primary so there aren't a lot of people that can and the other thing that happened is this is what is talked about it. and then apply it to a unique story. i think people finally woke up to tesla and started to say what else looks similar to this people missed out on a 75x on tesla over the last decade

and i feel just as emotionally invested and intellectually invested in virgin. >> he is with us for the rest of the hour and we have a lot more to talk about with him >> joining us by phone is lee cooperman. lee, we have talked about the volatility that we have seen the last couple of days. and are you a buyer or a seller? and the functions of the market and go back to it february 18th and i said the market was knocking on the door and there

were lots of issues that were being absorbed by the market some investor and i would say that you have to have a strong opinion about two issues one is the coronavirus does it get under control in a reasonable time rame the socialist problem we'll have to see. i don't think the country is so le leftest in it's orientation that

they'll be elected president we have to make it very clear. he is not a socialist. socialists advocate wealth redistribution communists advocate nationalizing the means of production and tearing down the house. that's his approach. i went to cuba three years ago now i have said this on your program i think more than once they're hard working people. you go to cuba and what do you see? they get it once a month and it takes two hours to get from the suburbs to downtown havana because they do not have an organized transportation system. it costs $3.85 a minute to get cell phones. they get no satellite service and no newspaper service and they lived in delapadated conditions

it doesn't make any sense. and we'll have to see this play out. i listened to the debate last night. i just don't think the country is prepared for socialism. >> what do you say to the 50 million plus people that believe if you read the policies and take socialism aside he looks like a social democrat akined to a politician in the nordic countries than fidel castro 2.0. >> i don't know. that's not how bernie sanders sounds to me my main hangup has been all along the constant attacking of wealthy people the villainizing of the billionaire class. i got into the billionaire class. but i don't care much about money, okay. i don't get it you know, i look at a mike bloomberg, the way he is treated in these debates, the way he's

attacked mike bloomberg lost out in a power struggle in his mid 30s. he had a vision of building the machine. he built a machine that you need in you're in the investment business he has built a $60 billion network. he gave away $9 billion to charity on his own well before he became involved in a big political way. he did a fabulous job as mayor of new york and they're attacking him and he had a great line in the last debate where he said i'm the only guy on this platform that built a business and they all looked at each other blank. bernie sanders hasn't worked a day in his life. >> at the end of the day i have been equally blessed as you but at the end of the day if the worst thing that happens is people name call us a little bit it's not such a -- it's not the worst thing in the world if it allows us to wake up to the reality that a lot of people haven't been able to participate

in what is really been an equity market expansion where folks like you and i who can be, you know, long equities in a massive way, levered up, access to certain products can do well to a degree that everybody else can't. so what people are saying is let's just acknowledge that that's happened. >> it goes beyond that i'm a believer in the progressive income tax structure. rich people should pay more but what we have to do is a nation is agree upon what should maximum marginal tax rate be on wealthy people we have to size the government to that revenue yield. now i'm prepared to work six months a year. that's a 50% marginal tax rate depending on which state you live in you're already past that state and federal income taxes and there's a great comment that i read recently and said what is

your fair share? i'm willing to pay a 50% marginal tax have no problem with that. i just think that the dialogue is destructive the moderator asked me a question after i gave my presentation and said what do i think the market would do if elizabeth warren was elected president and i said go down 25%. i think you had a different view i heard that previously and the next day she tweets, leo, i'm only looking for 2%. give others a chance at the american dream she has no clue about anything about me i sent kids to college in new jersey

i pay their tuition, okay? and i decided to take the high road when they go low, we go high i sent her a well written letter, very respectful with a closing paragraph that all of us have to work together to deal with the issues but there are issues i don't deny that. my approach is through education and hopefully fast economic growth what does she do she puts out a comment inside a trader and owned stock very constructive. the wall street journal wrote a comment that day that said he won the case what is she accusing him of? but it was nothing constructive. she was a politician in the worse sense of the word and we need people that see the issues. i like that in certain respects mike bloomberg is a republican and in certain presidents he's a democrat we have to avoid the labels and

we have to work together in a cooperative manner and all of this income differentiation has been the result of monetary policy assuming that bernie sanders or elizabeth warren were put into office and you're okay with maybe some of the criticism but from a policy perspective are you okay or encouraging of the policy and to the extent that you can appoint the head of the department of justice and say, you know, please go look at these individuals if you could say, you know, if you can account the head of the ces that's going to look into various companies in a more aggressive way i'm not saying that she shouldn't. i'm just raising the issues. even if you have a completely divided congress, how you see

this playing itself out. >> it doesn't matter who gets elected in my opinion. i have generally lost faith in the power and the impact of the presidency in domestic policy for years. it's generally the case that the president of the united states is given one hall pass in the first two years of their term at which point the american population either flips the house or flips the senate and creates spaces and it's happened relatively predictably now and it will continue to happen so the question is what do we think is the most likely thing to happen? when trump came into office the only thing that they were able to get done in which republicans were able to coral the wagons was tax cuts and tax change. but everything else came to a grinding halt. >> i don't agree with that

i'm not a trump fan but i believe the man deserves a certain amount of credit for what is going on i don't like his style so at the end of the day you have to vote your values or your pocketbook i'm at a stage in my life where i want to vote my values and my values tell me that it is wrong to call mit romney and it's wrong to tell rick tillerson he's dumb as a rock. it's wrong to say he's looking up and not down but the president deserves credit. they took the foot off of the foot of the economy. unemployments and minorities is at a record low. overall employment is at a record high. we have opened up a long overdue constructive dialogue with trade on china we focused attention on legal

immigration. all of this is good stuff. i aal apologize him to ronald ray gar. ronald ray gar was a very beloved president. when he ran for office he said i had a three pronged program. get the government off the backs of people and reduce taxes and regulation it's not just having a conversation about people that participated. >> there's a lot of stuff. the young people relate to that. >> talking about the evenness that we're talking about --

>> we don't need a gridlock in government. >> not understand economics anymore. to not understand the capitalism got us where we are. so you can have these great high minded nordic social democratic conversations but it's a dangerous place you're trying to take it. we're allowed to have diversity of opinion that's a problem for democrats. >> my -- how -- >> if you think that's okay that he's going to get the nomination, that's fine. i think you have dug -- democrats have -- >> i take a lot of energy in learning about what's happening. i take a lot of energy in reframing. >> we're stuck with bernie versus trump that could be the end result of all of this. >> how many -- >> let me do this, you guys wanted to talk about the market.

if you go back a week ago, 34. >> hubert: -- 3,400 in the market all of a sudden, i have to be very careful but all of a sudden the beautiful lady or the handsome man developed a blemish. and the blemish was the coronavirus and then what happens is these quantitative traders take over and they create a level of volatility that destabilizes. if you have a view of the coronavirus and i tend to have an optimistic take that by june we'll resolve it but i have no expertise in that regard i do not think that the country is ready to elect a socialist that i think that the correction is healthy for the market it's

healthy. and they created a very speculative environment. we have taken air out of the bubble and that's constructive this just a guess. we're not far from a correction low. it's predicated on two assumptions that i'm making and then go back up. i looked and the s&p is yielding well above fed funds and well above the ten year government. companies are growing and there's the ability and they're accelerating recession and fed or significant geopolitical events that you can have forecast and whether that coronavirus or specific event we'll have to see but my guess is it will be controlled

that's my story. >> you said you're a net buyer today. were you a net buyer yesterday too? >> i'm doing a little bit every day. i'm doing a little bit every day. i got three earnings call at 8:30. and six times what they expect to earn this year. they took out guidance because they can't give you guidance until they know what happens to the virus. they brought back close to 40% of their company in the last five or six years. they generate cash flow and it' the multiple stocks. i do a little bit of buying every day and i do some selling

too. harvest is where i think that the risk-reward isn't particularly favorable so i'm engaged but i think it requires a view on the coronavirus and a view of politics. >> can i ask you very quickly, i know that you have three conference calls that you just mentioned that you have to jump off for but last week i think you said that you think bernie sanders is a bigger threat to the market than the coronavirus. do you still think that's true but what made america great is our commitment to capitalism we have flaws and problems

absolutely the free everything. sure it's appealing. he wants to spend somebody else's money let him get a job and work for a living >> don't get me too upset. >> we have held you past the time we promised we'd let you go >> keep fighting the good fight. >> thank you. >> coming up, when we return, bob iger stepping down as disney ceo. but who is the new guy

take a look at an s&p bank and stayun ted you're watching squawk box here on cnbc.

>> some of his most notable accomplishments include shanghai disney in 2016 doubling disney's cruise ships and the expansion of disney's parks with new star wars and marvel ands and he brought content direct to consumers. that experience will come in handy with disney's focus on

streaming. >> well, i obviously have huge shoes to fill. i mean bob's legacy in the company is just profound my role is now to take the strategic pillars and he is so well established over the last 15 years and continued to work on those and implemented those in the marketplace plus they're laurjinching to tae on disney plus you can find my entire interview on cnbc.com. andrew, back to you. >> appreciate it for more on his legacy we want to bring in our guest and and also the offer of steve jobs who also created pixar help us think

through what is happening this year that's part of the dna of the disney company ever since walt disney didthat and hasn't

created many great characters in previous years he strongly opposed that pixar acquisition but he had just become the ceo and he lead isner speak to the board but iger won the argument and ends up with star wars as well. and somebody has a strategic view of where you're going in an era of cord cutting and digital disruption nobody beats bob iger. >> are you surprised who he selected as his successor? >> no, i mean, it's scary after

you saw what happened and obviously the theme park business is not as badly hurt for the long-term but that's bad. the good thing about disney is that it's very balanced. and they'll stay at home and they'll be streaming star wars i do think that it has shown an ability to really capture the consumer and that's the main

thing and it makes an emotional connection to consumers. >> that was a question that i was going to ask when bob first got the job people thought of him dare i say as a suit. they did not think of him as a creative genius. they thought of him as a business person. to some degree chapeck has the same reputation. it's sort of a left brain right brain situation. >> what's particularly interesting is bob iger saying he is going to spend the next year and a half or however long it is being an executive chairman focused mainly on creative because as you say, he came in

as a business suit so to speak he has great taste and great fingertip feel for both television and stars but he is not one of these hollywood people who is known as let me be the creative product person. so it will be interesting to see that he decided to cast himself in that role for the next year and a half >> what are you thinking he has this term that you invent whatever you want to say to make yourself seem amazing. that's a business that frankly more than anything else proved the value of really good m&a by using a highly levered security. that's what they have done the stock was flat for three years. so that single acquisition was i think the transformational event

and in my mind what it proves is the value of m&a so if you have a balance sheet like disney i would kind of think why not put somebody that has an eye more toward a transactional he's an incredibly successful m&a guy. >> and i think that portrays what he is good at. >> if the new guy is an operations guy you built up the company and now you know somebody that knows it well. >> i think disney is such an excellent exceptional example of what an old line industry company needs to do

if you listen yesterday he said we have all of our assets in place. i thought the suggestion he was making was -- >> the difficulty is now what they're finding and this was netflix that's going to do this is netflix has transformed the business into a consumer surplus business it's going to basically take margins to zero and as they do and as they fight for subscribers the only way to survive for somebody like disney is to acquire and bolt on acquisitions over and over and over again >> 30 seconds final ord.

we're going to be in a direct to consumer world and let's get these brands and he did it and he defserves credit. can you do anything? >> we won a bowl game. they won a bowl game three years in a row. >> i'm talking hoops. >> i said i can't. i don't know if there's enough points. >> it's mardi gras and people are not focused. >> yeah. that's true. they're going to be great this

year >> has coachella happened? everybody wants that to get cancelled. >> so they can finally be cancelled. there's people like you guys. >> narrative fallacy is pretty good. >> income inequality is a greater social evil. >> much more from our guest host coming up but first as we head to a break if you missed it at top of the hour, trending on twitter, surprising following his interview on squawk box. we'll be right back.

>> two disney park are closed right now. >> that brand and story telling will weigh outlast any type of short-term growth that we have. >> i try to go to disney land as i'm sure that you make your way there.

we talked about tesla briefly. i bought these converts a long time ago and it was like my zone three years ago. i believe in this business because what they're moving into is beyond cars and

sustainability and whether you believe in climate change or not it doesn't convertibles worth right now >> good. a large number. >> are you surprised to see the stock run so quickly so fast yes. this is what i said before with rates at zero, trillions of dollars of printed money, no investable equities, tesla and virgin one are going to have a bid. if you do something that captures consumer imagination, retail is a huge part of it. >> usg, consumer marketing. >> a complete fraud. governance has been addressed. that's useful. this idea you will get a stamp, my supplier, i have offset their carbon across, it's a joke,

jargon what people are doing right now, using it as a way, if you can paint yourself as csg, in europe you can borrow money from europe at essentially negative rates. >> i will come and give you a massage. >> i don't want you touching him, corona virus. >> i personally believe in climate change >> when you hear they won't finance fossil fuels and going to spend $100 million in real money everyday on biofuels every year, you say. >> two things. jpmorgan by saying what they said, will be able to borrow billions of dollars from the ecb at negative rates. >> you think that's what that is >> it's obvious what it is it doesn't have to work. they're now getting free money from europe for saying this. >> you don't think they would

get the money otherwise? >> no. because europe has a condition to issue green bonds and checks and balances it will be really important to diligence the supply chain to the supplier to the supplier that's a hard thing. these are useful statements. it's great parking lotting again, a lot of sizzle no steak. i think we need to invest in actual companies that can go and count and go and legitimize the actual impact the companies have so that you can do the right amount of carbon offsets you have to have a legitimate exchange to trade them if you really believe in climate change you have to do hard work. >> virgin galactic is going to bo be buying do you have an offset? >> galactic.

>> he just said that i need a cigarette in fact it was so good for me >> does that ever become an actual means of transacting, crypto, am i allowed to say crypto can i bring it up? >> i would like bloomberg to take this article i wrote in 2013 out of their pay wall, my view i held since today hasn't changed, everybody should have 1% of their assets in bitcoin. >> or crypto. >> i still believe that today. i believe it is a fantastic hedge. when you go back to the conversation this morning, you see the amount of leverage the financial industry is running and think about all these dislocations or exogenous things happening you can't predict, there is a lot of risk to the down side. it will be great an average individual citizen of any

country in the world has an uncorrelated hedge i've said this repeatedly,ed ad nauseum on this show, every financial instrument is correlated >> warren buffet says has zero value. unless someone pays more for it. >> i think he's an exceptional person i've learned an enormous amount from the afar and a few interactions, he is completely wrong. >> shouldn't it have gone down >> if it was digital gold. >> you have to look at volumes these are not thisly event driven strategies. >> you just said digital gold! >> i didn't say that >> he didn't say that. that's what people say >> i don't think when you wake up and see a corona virus scare

going down 2,000, you shouldn't buy bitcoin. 1% of my net worth should be on something completely uncorrelated to the world and how theworld works over some period of time accumulate a position and just never look at it again and hope that insurance under the mattress never has to come due if it does, it will protect you because then it will be hundreds of thousands or millions a coin. >> we have to go bank stocks, what are you? >> i'm a net seller, other than amazon >> because >> i think facebook gets regulated. i think google has to go through divestitures to get regulated. amazon keeps growing by 25% every year like clockwork, an

incredible incredible business >> thank you let's get down to the new york stock exchange. jim cramer joins us. a point in time. 87 points on the dow we're all over the map today are we searching for a bottom, do you think >> yeah. i think what we're looking for, like dr. falke said yesterday in the talk we are believers and not going to sit there like scientists i know it's pollyanna to say we have something right now while we will get clusters in the united states, there are people doing good things i don't want to get to the moment we had ebola and someone dies in texas and it is game over for our civilization. it's game over for that. you had a great discussion today and it's not too late to get optimistic when everyone is getting pessimistic.

>> that's a new statement from jim. >> i've been really bearish. down seven i have to get more positive, not the end of the world i checked my ap watch and she says not the end of the world. that's siri. e thank you, jim. seyou in a couple minutes. stay tuned, "squawkbox," we'll be right back. invested at a great rate. that's why fidelity leads the industry in value while our competition continues to talk. ♪ talk, talk

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i want to thank our guest host today the hour flew by thank you. we're out of time. keep an eye on the markets and listen to what jim cramer has to say next we hand it to "squawk on the street" right now. ♪ ♪ >> good wednesday morning. welcome to "squawk on the street." we are looking for some signs of exhaustion after 2, 3% down days on cornerna virus fears. futures did crack below 3100 but higher yields. europe i