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tv   Squawk Box  CNBC  November 11, 2015 6:00am-9:01am EST

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2015 and squawk box begins right now. ♪ live from new york where business never sleeps this is squawk box. >> good morning, everyone, welcome to squaux box here on cnbc. it's veteran's day. a day that we remember our troops and those that have served overseas and come home and those that have not. alibaba announcing it's singles day sales already surpassed last year's $9.3 billion total. that's more than americans will spend in total on black friday and cyber monday combined. research firm idc says that the e-commerce giant could see sales jump to $13.8 billion today. we'll have a live report just a little later this hour and then coming up at 9:30 eastern time don't miss jack ma at squawk on the street. he'll be ringing the opening
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bell remotely from china. now to the markets here at home, check out the u.s. equity futures at this hour. you'll see things look like they're in the green. right now the dow futures up by 40 points and the nasdaq up by 14. >> let's tell you about stories we're watching this morning. the big one, overnight, inbev finalized a bid for sab miller. $66.70 a share. or more than $105 billion. now the combined company would make about a third of the beer consumed worldwide. the exact number market share wise is going to be like 29%. as part of the deal to get this to appease regular you lay tors and we'll see whether it appeases regulators, sab's interest in miller coarse will be sold to molson coors. it's also a secondary issue that hasn't been resolved yet in china which is a stake in a
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company called snow. they would have to actually try to unwind a deal with their government partner in china. so we'll see whether that goes forward or not. also in the news this morning, new york ordering fantasy sports websites to stop taking bets in the states. they call it essentially illegal gambling. nevada took similar action last month. both companies fighting back. draft king will pursue all legal options to make sure that customers continue to play. they call the move political. >> the ads are already working on me. >> do you want to do it at this point. >> i'm not. but sunday is like christmas. you get to pick a few and i watch my points go up and when we do the pool, that's fun.
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suddenly we watch every game and we're interested in all the games. >> so then again i see the guy he's got -- >> you want to wear the hat. >> the guy with the hat on backwards and they're hitting an uber driver and i don't want to be one of those guys. anyway, express scripts -- i'm watching him going -- but i don't know enough. i wouldn't know which offensive linemen to pick. >> the argument is it a game of skill -- >> is it quarterbacksor running backs. >> is this a game of skill or a game of luck. if it's game of skill it would be legal. if it's game of luck, it's not. you know me with my sweet 16 picks. it's like pick the colors i like or hit the automatic fill in. >> well, i don't even want to go here but maybe it was a pretty good question. maybe we needed clarity on whether it is gambling or not. express scripts is cutting off a pharmacy that sold medications made by horizon pharma.
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the nation's largest pharmacy benefit manager is also suing the drug maker and shares are down sharply this morning. almost 20%. express scripts will drop linden care after it found the pharmacy dispensed horizon prescription drugs. this is coming out now. express scripts is also evaluating other pharmacies that it believed dispensed mostly horizon medications. >> let's get a check on the broader markets this morning. the futures are in the green today and that's the same story you see in europe at this point. the dax up by .8%. the cac is up by .5% and the ftse in london up by .4%. hang seng was down by about .25. if you're checking out oil, yesterday crude oil broke a four day losing streak. it settled up at 44.21 this
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morning. we must have seen a -- that's a december. so we did see a new contract come in. that is down to 43.71. also take a look at what's happening in the bond market. the ten year note edging slightly lower yesterday to 2.32%. it's sitting there this morning as well and if you take a look at the dollar at this point, the euro fell below 107 yesterday. it's sitting above that at 107.39 this morning. dollar is down against the yen at 123.04. finally gold prices, look right now, like they have barely budged. $1,088 an ounce. >> you know what's coming up? >> no. >> thanksgiving. >> no. >> davos. >> oh, january? >> did you see a thing yesterday? i got something that says i'm registered. >> you did? >> i didn't get anything. >> someone registered me. >> are we going again? >> yeah. >> the euro is to weak but it ain't the euro. it's the swiss franc.
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>> it's all against you and your travel plans. >> in scotland i'm using scottish pound. it's all so clear. so easy, yeah, sure. 13 different currencies in the european union. >> i think we're at parity for the swiss franc. >> 13 different currencies in the european union. do you think it's that simple. why are you looking at me? >> i'm not looking. >> are you going to come this year? >> i got a plane ticket. >> you are so ready. >> i got it already. >> you are through and through. all the subjects i talk about -- >> probably so. >> you are. the elitist panels over there. >> i am. >> they love you. >> i'm forced to go. a new day and a new chance for stocks to gain some traction. the market could still continue --
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>> your chance just went out the window. >> i want to go to my -- we stay in the sanitarium there. we do. with no lights in the halls. i'm not kidding. >> this year is going to be worse. it's a former tv -- there used to be a lot of people with consumption would go to davos for the altitude. anyway, sorry hans. >> you're not walking around that sanitarium saying redrum are you? >> it's as scary. >> it's like a hostile. >> it is. some parts of europe aren't big on luxury. anyway, we're talking about the august-september correction. hans is for the wealth and investment management business at barclays and there is a certain contingent that thinks that rate hikes cannot really be baked into markets and just as night follows day, when we make that turn, that inflection point, it's just going to be bad
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for financial assets in general. do we still have some retribution here? >> i think so. the bill has not come yet. >> the check at the restaurant. >> that's right. >> we have seen this play again and again. the markets consensus would get to the point where -- or got the market consensus but the belief would be that the fed would raise rates. talk about rate increase or the possibility there of. markets become quite unsettled and then fed backs away, market settles down. it's like boiling water. once the heat is removed it settles right down. this time it looks like they'll pull through, finally at last. unfortunately, it's, you know, the optimal time to do this, probably about a year ago. six months ago. now is kind of difficult as you get into the end of the year, there might be liquidity issues as banks reset their books. as, you know, investment
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managers reposition their portfolios. it's not a great time to have to be doing that. >> you know what, we say, well, the uncertain city hurting us now. we're going to remove the uncertainty but it's just increasing because we get every meeting and they say they're going to go up another quarter. are they going to do it again? we're never going to know completely when they're finished and far it's going to go. >> we know what the end point will look like. >> really? >> yeah, it's probably around inflation rates. but if you take the cpi year over year it's probably about 2%. so 2%ish would probably be the end point in you're right once they start the question will be the next time they meet will they increase the kwar. >> that gives us 8 meetings to sweat out on squawk box every single time and some where they won't raise. so they're probably at least 20 meetings we'll be sweating out. will the most important fed meeting of the -- we're going to
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do this. >> the interesting thing is that, we are now at a point where it would be very, very hard to, based on the numbers, based on the mandate, for them not to do it. when you look at earnings, unemployment, inflation. >> we handled the taper okay. we got out of qe and the market kept going up but this is different if it's rates going up instead of just getting rid of the qe. >> the complicated factor is the earnings aren't going up anymore. we're seeing the close of the 3rd quarter earnings season. this will be the third consecutive quarter where revenue versus fallen. the second consecutive quarter where earnings have fallen. even in the small cap sector which are more domestically focused. the earnings result there has been far from inspiring. in fact, it's been negative. >> all right. well, do you think -- the final question, worry about the dollar could effect whether the markets
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continuing. because we're just talking about earnings. i wonder if unlike the stock market, maybe rates start going up and the dollar has seen it's best levels. is that possible that 105 could be the low for the euro? or are we going to parity? parity is going to make it tough on exports. really tough. >> parity is definitely a possibility because we haven't -- the unknown, the element of unknown here is probably bigger than it's ever been because we haven't been a decade with essentially a rate increase. and it's a long time for people to take positions, build business models that assume a certain dollar exchange rate and a certain interest rate scenario. >> right. it's totally different. >> well then it's not in the books that stocks go up in 2016. >> not at this point. >> thank you. are you canadian.
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>> no. >> grew up in new england. >> close isn't it? >> near canada, isn't it? >> kind of. >> border. >> all right. >> we're going to talk a little politics this morning. there was a debate i don't know if you heard about it last night, gop presidential hopefuls squaring off on stage for the fourth time and john harwood joins us with the highlights. >> good morning, andrew. we had some sharp exchanges among the candidates last night but none that changed the emerging trajectory of the race in which both marco rubio and ted cruz, senators from florida and texas appear to be rising in the race. the sharpest of all to marco rubio's benefit came on the issue of foreign military intervention and related military spending with rand paul. take a look. >> i do want to rebuild the american military. i know that rand is a committed isolationist. i'm not. i believe the world is a stronger and a better place when the united states is the strongest military power in the world.
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>> marco, how is it conservative to add a trillion dollar expenditure for the federal government that you're not paying for? how is it conservative to add a trillion dollar in military expenditures. you cannot be a conservative if you're going to keep promoting new programs that you're not going to pay for. >> now you also had rand paul going after marco rubio accusing him of using a new child tax credit to create a newell fair entitlement on the issue of immigration which has been a flashpoint in the race. jeb bush and john kasich both criticized donald trump for suggesting 11 million illegal immigrants can be moved out of the country. that was a more energetic performance from jeb bush than we have seen in the past. not clear it's going to help him and of course ted cruz came back as usual with a strong conservative retorte saying amnesty is not the way to build up the american company or win
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the election. >> i was surprised to not hear marco rubio's take on immigration. it got a lot of heat last night. >> and interestingly even though he was the co-sponsor of the bipartisan immigration bill that's gotten so much heat from conservatives he with you never asked about that issue. >> the four man debate is easier to watch and listen to and i felt like i got a lot out of it. christie was phenomenal. >> he had a good night. >> he didn't complain and he said i'll go debate anywhere and i think he understood that he'd get 25% of the time and he decided i'm going to shine at 25% of the time. and he did. i saw a couple of people tweet that out too. >> and also did bobby jindal a favor. he had somebody to go after. >> gave people a better look at bobby jindal. >> we'll see how republican --
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>> you didn't like the juice boxes. >> no, didn't. but this is something that republican primary -- >> he'll get those with him. that's one reason why. >> republican primary voters will sort that out but bobby jindal finally had a foil in that debate who seemed big enough for him to go after and you know -- >> christie never took the bait. >> no, but jindal kept reeling as hard as he could and, you know, the bush strategist said he thought jindal actually came out on top of the debate with republican primary voters. >> no. >> is it just done. >> it was a better jeb bush. i think he was more confident. his body language was better. >> did you read this. >> i didn't. that he went against his own wishes that his whole campaign party told him he had to go meet
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with some guy. >> remember he advised his father's winning presidential campaign. >> he wrote a book with another fellow. he's a professional trainer for these things. >> the question is does he break through with enough force to grab the lapels of republican voters. he slid down below his former proper protege in florida and ted cruz and has the advantage of a lot of money and super pact that can put advertising on the air. hasn't moved numbers so far. it's not over for jeb bush but he has to string together a series of strong performances both on the stump and in debate. >> right. >> john, thank you very much. >> coming up, a live report from beijing on this singles day. alibaba sales smashing records already. plus t-mobile announcing it will offer free data usage for video streaming. so what's the catch? that story is straight ahead.
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but first as we head to break, here's a look back at this date in history. when you're not confident your company's data is secure, the possibility of a breach can quickly become the only thing you think about. that's where at&t can help. at at&t we monitor our network traffic so we can see things others can't. mitigating risks across your business. leaving you free to focus on what matters most.
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a sober remembrance will take place this morning at the
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tomb of the unknown soldier at arlington cemetery. other commemorations will take place at the national world war ii memorial. the veterans memorial wall and other places around the country. also officials in ohio will be holding a press conference today about a small business jet that slammed into an apartment building yesterday. the building burst into flames and a nearby house also caught fire. no one on the plane survived but no injuries were reported on the ground. investigators have been processing the crash scene throughout the night. >> we're switching gears this morning buzz t-mobile is introducing a new addition to the monthly wireless plan. free video streaming. subscribers won't have this now counted against their data usage. >> we are optimizing the stream for what a video is required on a mobile device and you'll be able to stream for free and then secondly for anything else you
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stream, even outside of these 24 you'll be able to stream three times as much data. no overages and none of the other shenanigans the big guys are pulling. >> he's such a good sales man. but the free video streams will be in lower resolution. that's one of the most important points about all of this and the offer applies only to customers that pay for at least 3 gigabytes of data a month. >> china e-commerce giant alibaba hosting the world's biggest shopping spree. singles day sales could rise to as much as 13 billion, 50% above last year. jew nis eunice joins us live today. it's numbers above 50% that justify any valuation. we'll see what happens but that's a big number to grow like that. >> there are definitely a lot of big numbers here. the greeting today among chinese
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consumers has been did you buy? and the numbers have been really impressive. the chinese post office inspects that 760 million parcels are going to be shipped today and alibaba has already seen 360 million transactions. i don't know if you can see the board behind me but the company has already exceeded and broken it's record from last year. the numbers are already reaching 12 billion, just about $12 billion and we still have five hours to go. now singles day is kind of like an anti-valentine's day. university students got together and decided they wanted to give each other and themselves gifts but alibaba ended upturning the day into this massive consumer extravaganza. there was a big fwrksgala in be and the sales and the discounts are for everybody. we already know that the best sellers on alibaba sites are
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phones and nike and new balance shoes and also the discounts have been incredible and the deals. people are talk about how they're dealing coupons to preorder an ipad pro. and you could get a cadillac sedan for 50% off if you're lucky and the whole point of the day is to get consumers spending here and the big question for alibaba is whether this type of spending is sustainable. people are wondering where is the future of growth? are they going to be able to clean up concerns about accounting or fakes on their sites. but even the chinese premiere has gotten into the action. his office contacted alibaba to congratulate them for singles day. >> you mention that the clock behind you is rallying up sales. that's 75 billion and counting at this point. >> sounds like we may be missing
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a connection here again. that's eunice yoon. >> missing connection or a long delay between here and there. in the meantime, let's bring in the founder and ceo of a consumer intelligence company that focuses on luxury retail in china. good morning to you. >> great to be here. >> help us understand this. this has always been alibaba's day but now there's more competition. so how do you think it's going to set itself up. >> alibaba is the dominant player obviously in china as it relates to e-commerce. they have 70% market share. we think it's a rising tide. the holiday will be 50% larger than last year. alibaba share will be proportion gnat. people talk about the other players but this is alibaba's day. >> is there a moment you think that could turn? do you say you know what i see them coming at the heels of alibaba in a way that we haven't seen before or is it the opposite? >> that's a great question.
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if you ask me that question two years ago i would have said yes but what we have seen in the hast couple of yea last couple of years is its gone from being a traditional e-commerce marketplace to more than that. video streams, omi channels so working with brands and investing in off line retail as well as online so this company that we thought of just a year ago as basically somebody challenged by the mobile revolution in china is now much more. >> you have seen the short thesis on alibaba and the concerns that certain investors have. >> absolutely. >> given your bullishness, just speak to that. >> so 12 months ago i share somd of the same concerns but what we have seen is how they're broken out of that. it's almost like google buying you tube seven or eight years ago and how that changed the video market and advertising dynamic and what it did for
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online advertising. very similar what you have now with alibaba is basically owning youtube and netflix at once in china. this is a business we hadn't thought about a year ago. >> i don't know if this is the right question or not, but we always keep thinking about alibaba as a chinese company. do you think there will be a day when they'll flip the switch and be competing in the united states in. >> not with the current construct. it's very chinese focused and chinese consumer sen trick in term of the user experience, how sales occur and products are delivered. to get here they have to buy u.s. companies in a big way. >> i find myself landed on alibaba oriented pages more and more when i'm shopping or looking for something or it's always in chinese or the english is broken. do you know what i'm talking about? >> absolutely. >> i think to myself if they just had a s.w.a.t. team of people trying to fix that
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component of it so that when people in the united states landed on these pages it actually looked like something we would be more used to that you'd have a heck of a business pretty quick. >> so that's very true. the challenge in the u.s. is you have amazon, you have ebay and some competitors. i think personally where alibaba would be best served, africa, vietnam, malaysia, other markets where you have significant growth. you have a rising middle class, you have a major dependency on e-commerce to deliver goods. the u.s. market, definitely interesting but i think chinese consumer is even more interesting than the u.s. consumer at this point. >> selfish question. thank you. >> appreciate it. we should tell you a quick programming note. alibaba's executive chairman will be on this morning. >> when we come back this morning, nbc's al roker taking the nation by storm. he's on the road this week visiting all 50 states in 7 days
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and helping an organization devoted to feeding those in need. al will join us live, next. first as we head to a break, take a look at yesterday's s&p 500 winners and losers. ♪ the great beauty of owning a property is that you can create wealth through capital appreciation, and this has been denied to many south africans for generations. this is an opportunity to right that wrong. the idea was to bring capital into the affordable housing space in south africa,
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with a fund that offers families of modest income safe and good accommodation. citi got involved very early on and showed an enormous commitment. and that gave other investors confidence. citi's really unique, because they bring deep understanding of what's happening in africa. i really believe we only live once, and so you need to take an idea that you have and go for it. you have the opportunity to say, "i've been part of the creation of over 27,000 units of housing," and to replicate this across the entire african continent.
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>> welcome back to squawk box. a week long trip reporting the weather live from all 50 states and the district of columbia in 7 days. al joins us live this morning. i've had trouble trying to keep up with you the last several days. where are you this morning? >> we are in slidell, louisiana at honey swamp island and all sorts of surprising today. we're going to try to do another 8 states starting in louisiana and as we make our way into the southeast we'll be at a number of naval -- i should say military installations. it is veteran's day and we wanted to kind of honor our nation's military by stopping off at some of those places and highlighting their work but we're having a great time meet a lot of people. we're eating very badly. by that i mean we're eating a lot of great food that's not good for us. and you know what, we like it. >> al, be totally honest with us. have been there a couple of
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times you got the green screen out behind you and stayed in one place. oh, look where i am -- it's okay. >> no. never. no. we don't make stuff up. >> no cheating. >> we go forward. no cheating. i understand -- you're at home right now. i understand. you're a hologram. you're not even there. >> can you get me a green screen and i asked get me a green screen. i'm going to be in davos because we can do that now, right. >> it's true. i know. but here on the "today" show we are everywhere where we need to be. >> okay. >> so watch today on the "today" show. >> what's the hardest part of this journey? is it the keeping one the food? is it the running? you must be working 20 hour days trying to get from state to state. >> no, the hardest part is trying to manage people's expectations. we have been so blessed. we had huge crowds showing up and as we get later in the day
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we lose time so these folks are waiting for us and we don't want to keep them waiting because once they see me there's such a let down that, you know, i feel really badly for them. they go that's it, really? he's so much shorter. it's not -- so the people that were coming to visit today, don't -- it's not that great, okay? but i can't wait to see you. >> it is that great and we are thrilled you are doing this al and we'll let you get on your way because you have a lot of stops on the way today but congratulations and keep up the great work. we'll see you soon. >> thank you, rokerthon, be there. >> wow, coming up energy prices under pressure this morning. we want to talk to one of canada's largest independent oil and gas companies but first as we head to break check out the dollar this morning. you're watching squawk box on cnbc. first in business worldwide.
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welcome back. it's been a tough environment with crude prices tumbling 10% this year. our next guest runs one of canada's largest independent oil and gas companies. the company reporting a mixed quarter last week but it is increasing it's 2015 production guidance driven by growth. he is the president and ceo and thank you for coming in today. >> thank you. >> the big news last week, at
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least in canada was that the keystone pipeline has been shutdown by the obama administration. what does that mean for your business in particular and what does this mean for the future of canadian production? >> you know, i don't think that was particular use for people watching this very carefully. this is well telegraphed by the administration for quite awhile now and so i think industry in some respects has moved on. canadian oil is moving to u.s. markets. rail has been a really big part of that so i think people have been focused on alternative market access as this drama is played out. >> do you think there will be another pipeline that doesn't cut across the united states? do you think there will be more rail production brought? ? what does it do in terms of limiting the amount you can take out of the ground and put somewhere else? >> yeah i think canadian oil is going to move the market. it's going to move to the u.s. and it's going to move overseas and find a way. rail is going to be a part of that. i think pipeline may well be a
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part of that. the only real issue that's going to come out of this is going to be potentially less efficient than pipeline access. >> in terms of raising your production for the next year, what is that based on. what's happening that you see right now and why do you think douk that? >> so we like a lot of oil companies are living within this tough market that you described so we are growing less than we otherwise would be. for those that don't know our company we have a big project in the balkin. we're in the sweet spot of the play. we have strong well results which has been a really key driver of growth for us. >> when is it profitable for those areas if oil falls below 0 is it profitable for you and what's the difference when oil is back at $80. >> it's evolving. clearly. i think something that is critical in thinking about u.s. supply growth is understanding that plays are not all created equal.
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it's about 1.2 million barrels of oil a day. we calculate about 10% of the acreage is really core in tier one. so for us in that core area we break even about $40 oil. so now the script points to 50ish. it's not as exciting as it once was. >> 43 this morning. 43 and change this morning. >> 43 this morning. we have good hedges which helps out a little bit but it's a really important dynamic that's played out where we have seen this amazing growth of u.s. oil production and so much of it is in areas that need prices higher than we're dealing with right now. >> when you say that it's 10%, $40 is break even. does that mean the other 90% you need to be 45 or 50. >> we're quite fortunate. we have been in the u.s. we're a canadian based company. when we set up our play we tried to get in the sweet spot and that ended up working out for us. we think all of our wells are in areas that break even under that
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$50 level. that wouldn't be a normal dynamic when you look at those. >> the iea just came out and is now saying that they don't expect oil to get back to $80 barrel until the year 2020. it's surprising. does that fit for your forecast for where oil prices are headed? >> yeah. so it's complicated making this call, clearly. we're planning for a lower scenario. we have cut our capital. we're moderating our growth. we cut our dividend as well to prepare for $50 oil. i would say there are some pretty powerful forces out there that seem to be setting the seeds for a bit of recovery, demand growth is strong and industries cut hundreds and billions of dollars of capital out of projects and that is going to impact supply. can we stay in that scenario for a long time? maybe but there's pretty powerful forces that can push it up. >> the cuts you already made assume a $50 oil market for how
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long? >> next year. >> next year. >> what happens if we say in the 43 to 45 to $46 range for the next year. >> yeah so we're going to remain i'd say nimble in connection with that. we ruled out a capital program next year that's 30% lower than this year which is 30% lower than last year. we have the ability to bring that down a little bit. the thing that's really interesting to watch is how fast costs have responded. >> sure. >> talk about the break even supply costs, the u.s. needed 60, 70, $80 oil as recent as a year ago and now they're starting to work. if we stay in this world we'll see cost response and we'll see a force of innovation that's playing out here as well. >> we have an oil analyst who joins us frequently and he's been pretty right on about why prices have stayed lower for longer and thinking that they would be in this area. one of his points is its a lot
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easier these days if oil prices start to pick up north of $50. he thinks that will keep a lid on things for quite sometime to come. would you agree with that? >> it has been one of the variables as price rolled off really, really quickly and people stopped completing wealth. wells have been producing but it's the extra to bring a well on to complete it. that phenomenon is playing itself out though. that's a 2015, maybe into 16 phenomenon. we were an example of that a year ago. we stopped completion activity for the biggest project in our company. we drilled wells and we stopped that partway through the project. that's pretty unique. but costs have come down and oil prices came up a little bit we were able to hedge more and started to complete them. there's not as much going on any longer. >> thank you for joining us. >> coming up when we return, the ceo of the bio tech company shares soaring in the last week on the successful treatment of
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an infant with leukemia but first it's time for squawk planner at 8:30 eastern time this morning. macy's will close quarterly results. the ceo will join us on the set and jack ma will be ringing the opening bell on wall street doing it remotely from china on the country's singles day and then he's going to talk live on squawk on the street and then speaking of a big sales day in the tech world apple's new ipad pro going on sale today and that is your squawk box planner. stay tuned. we're coming back in just a moment. ♪jake reese, "day to feel alive"♪ ♪jake reese, "day to feel alive"♪ ♪jake reese, "day to feel alive"♪
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i'm talking about a medical break through. an infant was struck with an aggressive form of leukemia and doctors used an experimental drug containing genetically modified cells but not hers. two months later the infant was cancer free. now it's being credited we limb nating the child's cancer and french genome engineering firm is behind the so-called wonder drug and the doctor is here to talk quickly about this and i don't want to lose everyone. what's amazing about this and you pointed out effectively is that instead of taking a person's cells out, modifying
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them and putting them back in which is what is usually done with this type of therapy which is very difficult to do, you used some other person's cells that were genetically modified to be able to work here which would make it much other therap in ice right now? >> yeah, the therapy usually are using t cells -- >> your own? >> your own t cells with an immune response, for example, infected cells infected by the flu, so you have a flu-type rejection of the cancer in this way, but you can want use others injected to a patient because then they attack the tissues leading to the host disease. >> organ transplants are the same. >> exactly. what we've done is take the cells and gene edited, go inside the cells and knocked out the gene called the t cell receptor so they are totally blind to anything that is nonself-and can
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totally focus on the tumor itself. >> so you didn't have to actually -- you didn't have to put in a new gene to recognize the tumor itself? >> well, yes. >> oh, you did do that? >> it's a very sophisticated product. step one, add the receptor, the gene that will definitely take the t cell out and focus on the tumor, called the car, and then step two, you gene edit the t cells -- >> the stuff that causes rejections. >> so the t cell is blind to noncells. >> you point out that the other type of therapy is a service? this is an actual product that could be used? much more widely applied, and i guess this little girl, she had had a bone marrow transplant so her cells were destroyed, no cells to take. they were gone. you had to use someone else's? >> yes. the doctors came to us and said, well, we have no other ways it cure this person because this
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person has no cells, and everything possible been tried on her. ship us a vile and let's try it on her and manufacture the viles in hundreds to thousands, so we had some of them that were staying in the fridge, so we shipped the product to her, and they just injekted it. >> i understand how you make a generic cell that wouldn't attack the body that you're putting it into,ut isn't every cancer that people have, isn't that -- isn't there specific cancer that you would have to put in the gene to attack that type of cancer? >> yeah. like the cancer that you would like to attack is determined by the gene that you insert inside which is the car. >> insert different ones for different types of cancer. >> exactly. we are trying new technology that we would like to conduct with cornell here in the states. >> that's -- you'll never get anywhere with that school. >> thanks, andrew. >> go big red. >> andrew went to cornell. >> we're cornell guys, we love cornell. for example, aml, it's like the receptor is seeing one, two,
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three, and mild leukemia -- >> they are all the same, the it's the same with everybody who has it? >> well, most of -- like, you have to check on the cancer. if you have, for example, the recenter on this cancer, for example, cd 19 cells, check the leukemia, if the cell is expressing cd 19, then you can use it. >> okay. >> if it expresses cd 123, then you can, but it's according to the tumor itself. there's different recenters and in the freezer, there's different products. >> could put five ones in for different diseases rather than an infinite number needed for each individual with his own -- with the antigen on his own cells? >> each cell, each product is focusing on the specific tumor, but not one -- >> right. but maybe you need five rather
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than one for each individual? you could have one that's customized for a specific type of cancer? >> yes. one cancer, for example, for all b cell leukemia, rempresenting hundreds of thousands of people, you could use the same product. >> how quickly can you ramp that up? >> we've been ramping it up. we've announced a few weeks ago that we've. able to conduct gmp production, which is running through batches in a row, and each batch of production is hundreds of thousands of viles, so now i think that for starting for the fifth batch, so it's, like, thousands of viles that have been producing, so it's, like, mass production that you can do this. ship them all over the world. >> andre, how is the biotech industry in france or europe? andrew says, brit lanrge, is it more difficult over there? can you -- how long will the patent protection be if this is successful for you? >> well, you have to see more
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like, on expansion and producing things that could cure patients rs but the fact is that the industry is extremely inventive and productive. the difficulty is the access to, like, large money is not that possible. this is why you see so many european bioteches coming to the united states. >> that's what we're told. we're told because there's, you know, there's pressure on prices there, that companies are not going to put in capital to develop new therapies because they are not able to, you know, be rewarded down the road. little drug development came out of europe versus the united states. >> well, because the investments are more intense here, and such type of very sophisticated and complex drugs are required a lot of -- >> you don't put money into something complex that, you know, if you do hit it, you know, and do something really incredible, you want to be able to, you know, you want to be
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able to be compensated for that. >> yeah, but this is most gross margin on the product itself, so what we're trying to do is trying to make a drug that's affordable compared to any type of cancer drugs, but keeping a decent gross margin for the company, which is within the fapharmaceutical growth margin. this is the important thing. it's not the price of the drug per se, but more how much you make money on the drug itself, and how much of the money reinvests after. >> have you thought about moving here? >> well, we have offices and labs on 21st -- >> a lower tax rate over there anyway, right? >> well, maybe for stock options, yes. [ laughter ] >> amazing. anyway, had to focus on business. thank you, good luck. >> thanks for inviting us. >> i now understand it a little bit. >> helped us understand it. >> tough for me to understand. when we come back, more of this morning's top stories including a beer deal, a loss for fantasy sports site, and
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this hour on "squawk box" "squawk box," singles, beer, and sports. >> we'll get you up to speed on china's holiday, a deal to combine the largest brewers, and new york's ban on daily fantasy sports. plus, apple's ipad pro available today for online orders, but will people upgrade or ditch pcs? top tech reporters weigh in as the second hour of "squawk box" begins right now. ♪ live from the beating heart
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of business, new york city, this is "squawk box." welcome back to "squawk box" here on cnbc, first in business worldwide, i'm joe kernen, and u.s. equity futures at this hour, up 69 or 70 points or so, and yesterday's session was manageable when all was said and done, looked to be down for a while, but nothing finally happened after -- when a finally closed. nasdaq up 21 points, and s&p 500 indicated up about 8. okay. let's talk about the stories we're watching at this hour. alibaba announced single day's sales surpassed last year's $9 billion total exceeding $12 billion in the past few minutes, more than americans spend in total on black friday and cyber monday combined. research firm idc says the giant could see sales jump up to 13.8 billion today. at 9:30 team, jack ma is going
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to be on "squawk on the street", ringing the opening bell remotely from china. >> hacked into the opening bell -- >> no, no, no, no, no, they did not hack in. >> oh, okay. >> good joke, though. >> yeah, thanks. overnight, though, another big deal, the beer deal we've been talking about for months, inbev with a bid for asbmiller, the price tag is $66 per share. in total, that's more than $105 billion, combined company makes about a third of the beer in the world consumed worldwide. this gives them a real foothold in africa and india in a way they did not before as well as part of the deal, we have to tell you, sabmiller's interest in miller's coors sold to molson for $12 billion in effort to appease american regulators. we'll see if they do that. i imagine it does. we talked in the last hour about
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similars they deal with in china around a brand called snow. fantasy sports websites ordered to stop taking entries in new york state. new york attorney general eric sniderman calmed these operations illegal gambling, and both companies fighting back, draft king pursuing legal options to ensure customers in new york state continue to play, and fan duel calls this move political. a lot more on that story in just a minute from dom chu in a little bit as well. and then the gop candidates clashed, of course, in last night's presidential debate. donald trump, governor kazic, and senator ted cruz sparring over immigration. >> we are a country of laws. we need borders. >> it's a silly argument. it's not a dull argument. it makes no sense. >> republicans joined democrats as the party of amnesty, we will lose.
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>> taxes were part of the contention. >> strongest military on the face of the planet, and everyone has to know it. >> i want a strong national defense, but i don't want us to be bankrupt. >> we can't have an economy if we're not safe. >> the next debate now set for december 15th in nevada. back to the markets this morning. joining us now is bob dahl, the asset managements's chief equity strategist, and mark grant, hilltop's security managing director and fixed income strategist, and, gentlemen, welcome to both of you. bob, i know you're in the camp of people who thinks that a rate hike is increasingly likely in december. jim cramer said yesterday, if that's the situation, you should bewe beware of stocks, do you agree with that? >> no. i think this time the market's waiting, waiting, waiting. think of the september meeting when many thought the fed would go, becky, that three weeks up to to that, the market was up
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8%. it sparked after and then down 7% in three weeks. the market's ready. we're at 0. time to get off that dime. the economy is standing up on its own two feet, and i think the market says, you know what, the world did not end when the fed raised rates from 0 all the way up to 25 basis points, and life will be okay. >> bob, does that assume that the fed raises once or twice and lays back so you're not looking at rates going very high very quickly? >> yeah. more important than when they started is the pace and the terminal rate, and we don't know know much about that yet. if they raise rates in december, the language around it will be very dovish to assuage fears of those worried they will be punitive. they will be very, very slow, perhaps lagging the curve up on the way up as we know. >> mark, what do you think? >> well, i've said all year, becky, as you know, that the fed was not going to raise rate, but
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i recently changed my tune about three weeks ago and said they were. it became apparent to me the way they are approaching this they raise rates in december, but i'm more negative than bob is. i think being more on the bond market side, you know, real estate, cost to borrowing, and the focus is going to change from when the fed raises rates to how much, how far, how fast, and i think it's going to have an impact, a negative impact on the markets. >> you know, one of the things we watch is what happens with currencies. the dollar's obviously going to get stronger, and we're not going to know immediately how quickly the fed raises rates, something we'll know in hindsight, and you can anticipate the markets react quickly. that's an issue too. if the dollar's stronger, what's that mean for corporate earnings? is that part of the concern, mark? >> yes, becky. it's going to be a very negative for corporate earnings. we had a lot of financial
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engineering. that's going to stop. the stock buyback programs -- not stop immediately, but they will start the process of stopping, and then you're going to have to look at not just earnings per share, but operating earnings as the dollar gets stronger and as american corporations are hurt by this. i think the ecb is pushing as hard as they can, the dollar to parody with the euro, and that is not going to be a good thing for the equity markets. >> bob, have you factored in that idea about a stronger dollar and what that means for the industrials? obviously, the financials benefit if rates are up, but other sectors could get hit hard. >> i don't disagree at all, becky. all year, my focus has been on companies to get most of the earnings from here and not so much multinationals because slower growth overseas and the rise in the dollar, and i don't think that game has changed, so you have to focus on a lot of domestic companies in my view.
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>> what's the companies you like, bob? >> so i think that is the consumer's in good shape, and whether you own a target, you have to be more specific with the retailers. i think the credit card companies, mastercard, capital one, discover, i think you have to own an airline, delta, these are the companies i think that can win even as growth is slow and the dollar modestly rises. >> mark, you said yourself, the strategies that worked this year, last year, worked the year before, do not work this year. what's latest in your line of thinking in terms of what will work? >> becky, i think coming out of the 2008-2009 recession, financial crisis, we were betting and it was a correct bet on appreciation. as you know, as we talked about recently when i was in new york with you, i said, this is a time to focus on yields, so i'm in favor of closed in bond funds that you can buy at a discount. i like taxable munis where you are getting yield, and you don't
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have the exposure to the dollar to europe, to china, and so i'm looking at some alternatives here, and i think that yield, given that the equity markets have been totally flat and given that the treasury markets have been totally flat all year long, we're, like, minus or plus almost nothing for the entire year, so i'd rather get yield and get return on my capital than try to bet on increasing the capital. >> all right. mark, bob, gentlemen, thank you, both, for joining us today. >> thank you, becky. >> thank you. coming up, when we return, senator james langford launching a bipartisan propose to cut government waste. joining us next, and then fantasy sports under fire. new york banning two of the most popular sites. details straight ahead on the story, and, plus, apple's new larger ipad pro available today, but will it be as big a game changer as tim cook claims?
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we'll ask ed lee. we return with all of that in jux a moment.
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welcome back to "squawk box," everyone. we've been watching the futures this morning, over at modest
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advances yesterday, you are seeing a bigger pickup this morning. dow indicated up 69 points, s&p indicated up by 8, and nasdaq up 20. jcpenney on the move this morning, announcing the settlement of a class action false advertising lawsuit for $50 million. they added despite the financial impact of the settlement, they are pleased with the soon to be announced third quarter results. the stock up by 7.5%. senator james langford and heitkamp are teaming up to trim the fat in washington. he's a member of the appropriations committee in energy and water, soon to release a report, and watching the debate last night, senator, apparently, there is waste in washington. i was not aware of that. did you get to see any of that? >> i can assure you there's plenty of waste in washington, what both we're aware of and what we dig out and find out the
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time, but thanks. >> i know, it is staggering, a daunting task. you have to start somewhere, i guess. ta how do you begin? >> so the challenge is every member of the congress, every member of the senate, house, should dig in, look for areas in their particular committees and find areas that have waste. there's $430 billion in deficit spending this year with complaints about that, a lot of conversation about how do we get on top of that? we have to get practical solutions on the table. all of us should work in the areas where we have purview, be able to find the areas of waste and be able to lay those on the table and say we're talking about how to get back to $430 billion. there's a way, let's chip it away. >> senator, i don't want to be cynical, but i saw an msnbc report, a gas station costing half million, but came in 54
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million, asked how it happened, and, like, i don't know, they had no idea. by definition, no one in government has a boss, reallying i don't think that takes it seriously in terms of watching the money come in and you tax people more and get more money. why mind your ps and qs. how do you do this? by definition, it won't work. >> government, you're right, by definition is inefficient. government is not business. government is like a business? it's not. it has all inefficient sis of government and retapes that. only way to make government official is to make it smaller and local. your local county commissioners are more efficient than your federal government is. saying all that, there are structures that have been put in place, the inspector generals, gao, they both exist just to be able to look for areas of waste to gather the reports. there's also an expectation from the agencies that the executive branch put down to look for areas of duplication.
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we have to get that. one of the bills that i have on the table is the bill called the taxpayers' right to know. right now there's no list of every program in the federal government, how it's evaluated, if it is at all, and the number of full-time equivalent employees in the amount it spends on each program, you can't deal with duplication if you can't get it all on the table. every business in america has a list of everything they do and watching for duplication other than government. that's one of the tools we have to add to the tool box. we have the inspector general and gao to do that. we have to use their reports and digging into this stuff. >> yeah. the other problem, senator, and, you were involved talking about keystone and, you know, aspects of that pipeline. we know the oil's coming one way or another, on rail, whatever, but that's besides the point. we had bill daly on the other day, and when they tell me it does not materially add to the economy, and the number he used
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for jobs was 200, and i said, no, i think it's more than that, but, you know, we don't -- one side straight faced, 200 jobs. looking at what you said, the state department says the project creates 42,000 jobs. someone between 200 and 42,000? who is lying? >> in all likelihood, it's both. they have long term numbers. once the pipeline is constructed, operational, how many does it take to maintain it and just monitor this pipeline? the good thing about a pipeline is it does not take a lot of people to monitor thousands of miles as they track through the equipment. i'm talking about construction jobs. >> right. >> that's welding. all the construction, all the land man work going into this, that's 40,000-plus jobs. the state department says this. >> right. >> when the president said he was not going to accept the pipeline, he said it did not lower gas prices right now or
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enough jobs for a highway bill. this is private sector funding, not public funding. oddest to me of all, it's not in our national security to purchase oil from unstable countries. when did canada become an up stable country? it was an odd answer to me that we don't want to buy oil from unstable countries. >> did he mention all the infrastructure projects that democrats want? are they permanent job? people building the road there? those might be temporary as well. >> they are. >> but with the public sector infrastructure, they do not mention they are temporary jobs. >> that's correct. the other challenge is it's clear, this is taxpayer funded money. >> right. >> when you talk about infrastructure projects. private infrastructure for pipelines is private money, infusion into the economy. >> talking about this, you should just resign. listening to what you go up against day in and day out, i couldn't stand it. >> it's frustrating. there's basic things on energy policy like oil exports that's
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old policy. we are swapping crude oil from mexico right now for some of the heavy crude coming in for our light sweet and swapping it. we have a commodity that the oil wants, light oil that refineries don't want, that oil, we should butt that on the world market. it's a no-brainer, a jobs development, expansion, and our trade deficit. this should be a simple thing, but it's incredibly frustrating just to put a commodity we have an abundance in the world market for a place to buy it. >> how many elections -- how long you been a senator? >> i've been a senator for a long time, almost a year now. it'll be pushing. >> bright eyed optimism, you'll learn. >> i'll take it. >> senator, thank you, a friend of the show. >> terrific ally on the show. . able to work together a lot on it. >> good, well, thank you, good luck, and put up with thall tha.
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see you soon. >> thanks. >> all right. when we come back this morning, new york's ag dealing a blow to draft kings and fan dual, ordering them to stop taking bets from new york residents. details straight ahead. time now for today's "aflac trivia question," how much did the original kindle sell for? the answer when cnbc's "squawk box" continues. aa-flac! aflaaac. aaaa-flaaaac. someone's sandbagging. i'd be tired too. he paid my claim in one day when i got hurt. one day? serious hustle. serious duck. in just one day, we process, approve and pay. one day pay, only from aflac. ah!
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now the answer to today's "aflac trivia question," how much did the original kindle sell for? the answer? $399. new york attorney general ordering draft kings and fan dual to stop accepting bets from new york residents. dom has more now, and i talked earlier, the ads are starting to work on me. >> are you playing? >> i'm not going to do it, but i said it looks fun. >> you know, comcast nbc universal is an investor. >> have you tried it? >> i have not done daily fantasy sports yet not because i don't
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want to, but because i've been told by my wife i spend enough time on regular sports. the reason it's important, guys, the most important development here so far in this whole fantasy sports issue is because new york state, by many measures, in some estimates,ing thes for 10% of the u.s. fantasy daily fantasy sports industry. it's a lot of people here, right? unlike in nevada, which was the other big one that happened, nevada, remember, put cease and desist on these things, there's a lot more people here playing fantasy sports. a big reason why this is coming across right now is because there has been a number of inquiries made by new york state attorney general, and this was all, remember, in the aftermath of what happened with regard to whether employees had access to some of this proprior tear nondisclosed information ahead of everybody else. here's the interesting part about it. it is the next part. both sides weigh in. i want to realize a couple
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things. basically, is it or is it not illegal gambling? the new york a.g. says our review says fan dual and draft kings institutions constitute illegal gambling under new york state law and the constitution here in new york, important to which a person engages in gambling when he stakes or risks something of value upon the outcome of a contest of chance or a future contingent event that's not under his or her control or influence. >> broad definition. >> very. >> the stock market. >> well, we can liken it, if you will, but there are differences, right? why is it not illegal gambling? draft kings issued a statement in response to eric's remarks saying that we strongly disagree with the reasoning in his opinion and will examining and vigorously pursuing all legal options available to ensure that over half a million customers in new york state can continue to play the fantasy sports games they love.
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>> giving them five days to respond. what happens at the end of five days? >> interesting part about this is is this does not shut down overnight. there's going to be a time period, a lot of legal wrangling that happens. it's not that people who use the sites immediately have their accounts frozen or locked. you can access the website, see what's going on, they just, in some way, shape, or form in the coming days cannot take wagers like nevada has done so. the interesting part about this whole discuss is what it leads to next. is it considered gambling? maybe it is, maybe it isn't. folks out there likened what happens with draft kings and fan dual, fantasy sites, to a lottery or to a game of no limit hold' em or the roulette wheel. the subtle difference here is at the end of eric's statement, he cites the new york state constitution for what are expectations to the gambling rule, meaning gambling happens all over the state of new york
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legally whether it's the power ball, lottery system, anywhere else. you kind of feel it's the next step here is possibly a run at trying to regulate and maybe tax or get some kind of a compensation element from these sites. that's the reason why it's important. it's a big one. it's not that it's not that big overall. we shouldn't care that much because it's daily fantasy sports, but this tells us something about the regulatory environment these days. that's why it's key. >> thank you. fantasy sites. >> yeah. fantasy sports sites. >> you said fantasy sites. >> i did, yes. >> coming up, craig hodges talks picks next. details next. as we break, look at u.s. equity futures. we can help guide your investments through good times and bad. for over 75 years, our clients have relied on us to bring our best thinking to their investments
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♪ welcome back to "squawk box" here on cnbc, first in business
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worldwide, and among the stories front and center at this hour, mortgage applications drops 1.p% in the last week, and average rate on a 30 year fixed rate rose slightly to 4%. economic figures from china today, the output growth is a seven month low last month, and meantime, investment expansion fell to the weakest pace since 2000. express self-incriminates cutting off a pharmacy, evaluated by others who believes suspenses verizon medications, coming out after valeant issues. shares offerer vieson down, just out with a response saying our philosophy of ensuring that parties get med siicines doctor prescribe is profiteering exp e exposing what we believe is a lack of care for patients and respect for physicians. >> tough words. >> the battle is on. >> yeah. >> one of our platinum portfolio
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matches is switching up the play in the playbook. craig hodges is here, good morning. >> morning. >> tell us, we've been following you, morning, tell us about the big move this morning for you. >> yes. >> you did it yesterday? >> yeah. j taking matador, stock ran to 27. 25% on oil stock in this market, i'll take it. taking that one off and putting on jcpenney, who we believe is in the midst of a turn around. >> $9.50. >> i think that's because of me or do you think that's other news? >> there's other news becky talked about in the break. you want to share? >> a settlement they had, but third quarter results are good and same store sales up 6%. >> you made the move just 24 hours ago. >> yeah, yeah. >> now would you get out?
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you are up close 10%. >> i think the stock could go to 11, just, i think the report earnings were on friday, and so stock dropped about 15%. >> is this a short term trade? >> not necessarily. i think there's money to be made on the short term, but they have earnings potential of $2 a share, eventually. >> you know, years down the road. this is a company -- >> how many years down the road? >> four, five. >> wow. >> they say 50 cents in 2017. it's not cheap, but, you know, it's one that what they are doing, i mean, y'all remember what ron johnson came in and just destroyed their loyal customer base. >> yep. >> it's very slow in bringing them back, but they are doing the right things, and channel checks we're doing, the people are coming up with penney's at the top of the list again and such, taking share from kohl's and macy's. the turn around in is place. >> it's a long game. looking at what is expected,
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2020, just 1.26. >> but that trades $20. you know, a double, but it's a big ship, long time to turn, but, obviously, what you're seeing is obvious, they are getting the turn made. it's just going to take time. they are cutting costs, doing thicks like that, and i think they cut 9% of the work force in dallas, redoing the pension, i believe, restructuring it, and then, so, really, the hard part is getting customers back, which i think they are going back to the loyal, you know, coupon driven discount driven customer base. >> down the list, you like american airlines? >> yes. >> you don't think there's pr e pricing pressure at some point down the line? >> there hasn't been. people talk about pricing power in airlines, and prices have not gone up in 50 years, right. >> so i think there could be inflation, but most of the airlines are trading below ten times earnings, american trading five times. >> 44, 45? >> yeah.
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>> 9350 earnings. >> where do you think that is 12 months out? >> i think the stock could be $ $60. american doesn't hedge. they benefit more from the low fuel prices more than anybody. >> you think there's multiple expansion? >> i do. i think they are returning so much capital to shareholders that eventually those airlines get more of a market multiple. i don't know that they'll trade 15 times earns, but ten times, you would see a tremendous move in the stocks from here. >> and trinity industries is your third one. >> yeah. three quarters in a row, real car manufacturer, three quarters in a row of beating expectations and raising estimates, and the stock is not doing much, but six or seven earnings, and still grows. >> okay. >> looks good. >> well, we'll watch all of them. congratulations on catching cjpenney, a nice call. >> luck. >> wish you were on yesterday. >> yeah. >> thank you for the picks, check it out if you visit
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cnbcpro, joe? >> coming up, apple's tim cook proclaiming death of the pc this week. the ceo touting the company's new larger ipad. digging into apple's product line and that's next. stops improving. k that nev ...that's grown faster than any other, covering nearly every american. and these geese. but it's not who you think. it's t-mobile. our new extended range lte signal... reaches twice as far. ...and is four times better in buildings. think you know our lte coverage? think again. see for yourself at they are. do i look smarter? yeah, a little. you're making money now, are you investing? well, i've been doing some research. let me introduce you to our broker. how much does he charge? i don't know. okay. uh, do you get your fees back if you're not happy?
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if you only knew. apple's newer, bigger ipad on sale, and reviews are in. we are joined from san francisco with a big debut. >> reporter: good morning, joe, it is a big debut because it's a big product. the ipad pro is for sale on line only today, in stores later this week. the pro is bigger at 12.the inches with a stylus, enhanced retina display. they hope it applies to the creators, but the key audience is a business customer, a segment dan ives called low hanging fruit, counting on the market for ipad pro's success, predicting it helps reverse the negative tablet trend and remit 15% of apple's revenue up 10%
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from today. tim cook estimated the enterprise market makes up $25 billion in annual apple revenue, up 40% from the prior year, calling it, quote, a major growth vector for the future. he takes direct aim at the pc market saying, quote, why buy a pc anymore? no, really, why? there are challenges as iphones have gotten bigger. some argue it decreases demands for ipads. cook acknowledged that. plus, while apple tops the list, idc's overall tablet sales declined 12% in the third quarter. joe? >> okay, thanks. so, will the ipad pro replace the pc? joining us now, ed lee, the managing editor and our own, john, to me, seems like semantics, guys. it's not completely, but it's -- is a new ipad with a key pad that different from a laptop,
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and a laptop different zblsh. >> yes! >> yes! >> why? >> ipad is not as good as pcs. >> tim cook wouldn't lie? >> a brilliant guy, but he's wrong on this one. first of all, the idea of killing the pc in the third quarter, pc shipments were down 11% year over year. shipments down 20% year over year. when you -- >> doing well. >> mac's doing well, yes. >> that's a personal computer that's going well. >> i'm not sure, but, look, i mean, the ipad pro costs around $700 if you put the keyboard on it to make it more productive, then it's $900. the average price of a non-mac laptop is under $500. why buy a pc? because you don't want to spend more than $500. >> he's talking about his own laptops? >> no, no, i think test hawking
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about windows, but there's never been a time where cook said it's a great time to buy a windows pc. this is not the salesman for the windows pc. that said, windows 10 is coming out. it's well reviewed, a good product, going to be cheaper to get more productive on the windows platform than in a long time. >> that's key, though. he wants to hit the enterprise space. what's that mean? the business consumer, big companies wanting to buy, you know, hundreds and thousands of unites at a time. you know, a lot of tech companies right now are seeing certain maturity in a lot of products so it's, like, where do we find growth? i don't know that this new ipad pro will be leading the way for that to happen, but it's a great device, with bells and whistles, but it doesn't -- i agree, it does not replace the pc. >> the guy i trust is your boss and colleague, the ipad proe cannot replace it, even a tablet lover. he loves it. >> uses it all the time, like, this is not going to replace it.
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you still need the full on device, you know, the attached keyboard in the proper way, adjust the right way, and this new tablet thing has a keyboard, but you angle it one angle. >> a winner or loser? >> it's a winner, but it's not a mainstream product, even for corporate, even for the enterprise. this is under the category of executive jewelry where the high up executives who decides whatever they want to work on, they might get this, the creative folks who get the more powerful pcs anyway get a specialized tablet, but the worker bee is not carrying around a 12 inch tablet with a keyboard. >> we had the guy come on, that great macbook 12, like the air, you know what i'm talking about? >> the really thin one. >> yes. >> compared to an ipad. if you could use that or one of these things with the new keyboard? >> no, you're going to use the small laptop. >> yeah.
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>> you know -- >> the reason you say that is because of the angle of the keyboard? >> that's huge. >> really? not the functionality of the laptop doing more than the ipad? >> i think you nailed it earlier, joe. is it semantics, blurring the lines, like, the tablet is now so powerful it does so many things it's like a laptop? it's form factor, how it works, how you touch it. >> angle of the keyboard on a plane. >> absolutely. >> you don't want to sketch the mona lisa. you can't do that. you need for the laptop to be at the right angle for the cramped seat in coach. >> i don't need a laptop. ipad. >> it's happening. >> i don't need a calculator. >> talk about t-mobile for a quick sec. >> data caps? >> about data caps -- >> lack of. >> allowing free streaming for things like netflix and hbo, by
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the way, at a lower resolution, though. >> sure. brilliant. >> game changing or not? >> marketing gimmick? what is it? >> everything done is game changing, but recognize he's playing a different game than the other carriers are with all this capacity to deal with, and he needs people to get into the bar, so he's, you know, it's ladies' night, the band is playing, it's free before 10:00 p.m., he's throwing this stuff in there to fill the bar up. it's working. he is changing the game. >> the lower resolution point, i mean, it's -- there is a bit of marketing here, a lot of marketing, frankly, it's a race to win consumers. whatever he does to get them to come over, he'll do that. >> do they have better bandwidth? because there's less people using services? >> that's a big part of it. they got more capacity, building out lte, and now they need more people to jump in, and they have been changing the rules of the game to make that happen. >> you notice on the other side,
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the video part of the freda that cap paying or no data cap, facebook and youtube are not part of it. they see it as, you know, this is a gimmick. i don't know it makes sense for us. >> headline, snapchat, down valuations, rather, from fidelity. >> square ipo. that's my response. square. they put out the perspective for ipo, willing to go out at a lower valuation in the public markets than raised private. >> right. >> if you're an investor in the small unicorn startup, like, square's going out like that, chances are the others are overvalued now. >> snapchat is not just a unicorn, but the golden chosen unicorn. >> domino effect? >> yes. >> so many of the unicorns have public money in them where they have to market in some way that the other investors, the venture guys have not. >> it's burn rates at this
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point, about how much the growth is real, how much is driven by marketing spending. i mean, a lot of us, remember, the story from 14 years ago, 15 years ago, we saw the dot-com bust happening. it's going to be ugly out there. >> the stocks busted? [ laughter ] >> yeah. i know, it's all up here. >> all up here. >> wow. >> ja"squawk box" is stalling, now, but i guess we can go to break? yet? >> no. >> no? >> you don't want the segment to end? >> no. ♪ [ laughter ] ♪ oh what a night >> you know what this is? disco. >> ladies' night. >> oh, yeah, yeah, ladies' night. >> a reference to your man. >> t-mobile. >> savior. >> i actually do value you. >> yeah. >> anyway -- >> see the comedy, it's bringing it back. it's bringing it back. >> you heard the joke about the roof? >> i moved on. >> okay. all right.
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it's good. >> there we go. anyway. >> guys, thank you very much. when we come back this morning, ecbs with a speech this morning that could impact the currency markets. a live update from london after the break.
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bob dylan. to improve my language skills, i've read all of your lyrics. you've read all of my lyrics? i can read 800 million pages per second. that's fast. my analysis shows your major themes are that time passes. and love fades. that sounds about right. i have never known love. maybe we should write a song together. i can sing. you can sing? do be bop. be bop do. do be do be do. do do do be do.
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welcome back. the currency market watching comments by draghi.
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pressure is expected to remain on the euro, and we are there with more on that. jeff, watching this closely since it became more common thought process that the fed raises rates, there's been a lot of pressure on the euro. >> reporter: yeah, absolutely. i think the prospect of the fed possibly going for liftoff in december may give the ecb a little bit of breathing space, but, clearly, look at developmen developments politically in portugal right now, there are still concerns as far as the ecb is concerned. one, that we have stability around europe, and, two, that the current round of asset purchasing is actually generating some form of liquidity that is seeping into the real economy, and the evidence is not there, really, in the data at this point. we still have very weak pmis in the euro zone, which is why people focus on this speech due up in 15 minutes or so. the question is, will mario
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draghi continue to talk about what dude more on extending the scope of the current qe program, or, indeed, the time of assets that they may be willing to purchase at this point. we heard from axel in earlier interviews, former head of the bank, suggesting that maybe there could be a ten basis point cut on interest rates, but we are already negative deposit rates for europe here, so if they are not creating growth at this point, one does wonder if we got to a decision on a further ten basis point cut, what difference that would actually make to the growth path we see for the euro zone right now. back to you. >> all right, geoff, thank you very much. we'll bring you the headlines as we get them. let's take a couple stocks to watch that are worth watching
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today, semiconductor maker, sky you know works solutions, announces a $400 million stock buyback, battling with semito buy smcsierra. one selling half a stake in the social networks giant, 19 transactions involved, prices 101.96 to 110 a share. interesting. john paulson alert. john paulson, hello, john. he's in the rain. >> huh? >> nobody knows what we're talking about. >> john paul walked by. he walks by a lot. >> on the way to the office. >> never looks over, never looks over. >> brunswick, maker of boats and fitness equipment expects to benefit by improvement in the core marine markets and microsoft's price target up at cls to $60 from 54.
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they say it thinks that the tone of microsoft's business is the best it's been since the 1990s, and we just heard about windows 10, john ford talking about it, well received. for me, it's when the new yellow pages come, you know, the new phone books here. windows 10. >> get right on it. >> so much better than windows 9. how do you get decent it computing power? >> operating systems in general. you downloaded the last apple one. >> i did. windows has been a -- >> it's -- >> unbelievable now. unbelievele. >> so much better because of vista. remember vista? >> i remember the name. >> vaguely. >> after 4. it was terrible. now they improved it. >> mastercard. >> talking about the new microsoft store. i went to it, fantastic.
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i thought it was an like an apple store. >> i could spend hours in there. >> after the show, we should walk over there. >> what's it have? games? >> it's right over here. >> you can play a drum set on the screen. there's cool neat stuff. it's fun little store. >> we usually on a rainy day go to bed, bath, and beyond and look at everything from duvets, all the stuff. >> you know -- >> you could get lost in there. >> thank you for admitting it. >> sandisk, is there one nearby in the city? >> the one we go to, absolutely. >> linens and things. >> are we not going to body shop after? >> what's body shop? >> lotions, creams, yeah. >> you know -- we may have to do that. metro boy here. [ laughter ] downgrading market perform from out perform at bernstein. the price target at 86.50, and amazon's price target raised to $800 at morgan stanley and
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shares are weighted overweight. >> brookstone. >> you didn't know what it was. >> i didn't, no. i didn't. i thought it was on 42nd street. that's another body shop. >> no, no, no, no. >> okay, yeah. we can't go there. morality clause. >> no. >> or victoria's secret. they had a big show, you know, they do that -- >> did they? >> last night. >> guys, this is getting weirder by the minute. >> more uncomfortable. >> let's get out of here. >> for becky and viewers too maybe. we'll bring you the numbers and a first on cnbc interview with our ceo, joining us all that coming up right after this quick break. back in a moment.
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macy's earnings crossing the tape, a miracle on 34th street or a night mare before christmas? we are joined with the results, and the company's holiday forecast, first on cnbc. >> a method to make big money from a tiny startup to $200 million in sales, how the eco-friendly home goods maker cleans up the aisles of target and disresults the cleaning
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product industry. we are live from the iconic conference in washington with the company's cofounder. >> called the electronic cast king. ♪ how the dj is filling stadiums with fist pumpers and fat bass lines raking in millions. joining us to talk about the business of electronic dance music. the final hour of "squawk box" begins right mow. ♪ live from the most powerful city in the world, new york, this is "squawk box." welcome back, everybody, this is cnbc, first in business word wide, i'm becky quick with joe and andrew, and we are less than 90 minutes from the opening bell on wall street. the futures this morning have been steadily picking up through the course of the morning. dow futures now up by 86 points above fair value after modest advances yesterday. s&p 500 up now by 10 points,
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nasdaq up 25. what's happening in europe at this hour? you see there are green arrows across the board. in fact, advances have improved throughout the morning too with the dax now looking up by 1.4%. the cac up and ftse up .75%. >> stories this morning, inbev finalized a bid for sabmiller, the pricing e ing ttag is more billion. the interest will be sold to molson coors in effort to appease american regular laters. this morning, mortgage applications dropping, and the average rate on a 30-year fixed loan rose slightly to 4%. the oil prices lower, plans to release data this morning, so we'll watch for that.
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>>. >> i'm sorry about this. few stocks to watch this morning. jcpenney, is what it is, third quarter same store sales up 6%, and it says it's pleased with its overall results, the retailer scheduled to release full quarter results friday. nothing -- they are not gaining market share from you, are they? oh, good. he responded. think about it. now you have a good response with all this time. verizon pharma taking a hit. a lot going on in the specialty areas. this time it's express scripts, a pharmacy benefits manager cut ties with linden care, a specialty pharmacy made by horizon. as a result, horizon in suit, and they are seeking recovery of $140 million for alleged breach of contract.
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>> chinese e-commerce giant breaking its own singles day record. singles day there is the opposite of valentines day here. we are joined with more on the story. >> reporter: thanks so much. well, jack ma was on the stage speaking with chinese media saying a couple things about the economy. the chinese economy in his perspective faces difficulties over the next five to ten months and said that he's expecting to bring singles day to new york or london, though he didn't give a time frame. for today, though, it is in beijing, and so far he said the events here have been very successful, and why shouldn't they be? the numbers are impressive. the chinese post office said they expect 760 million parcels to be shipped out today, and soofr they have seen already 400 million transactions, and they also, i don't know if you can see the board behind me but they
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have closed in very quickly on 13 billion dollars in sales. there's still three hours left for this event of the the event as becky was mentioning is singles day, but it's app anti-valentine day, a time when people give gifts to each other, but it started with the university students who gave gifts to themselves and also to each other. the company, though, managed to turn this event into a massive monster consumer extravaganza. yesterday, there was a big gala, daniel craig, the james bond actor, was here on the stage, and the whole point of it is just to get chinese consumers spending, and we saw a lot of discounts and deals. people have been picking up coupons to preorder ipad pros. some people got 50% discounts on cadillac sedans. the best sellers here at alibaba
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are phones, nike shoes, as well as new balance sneakers, and, of course, they face a lot of questions about future growth. after today, what happens about the accounting irregularities or cleaning up the sites because of counterfeits, but today, it's about the numbers, and as i said, guys, they are so far, very impressive. >> okay. thanks. jack ma, as you know, is on at 9:30 on squawk on the street. as you can see. just minutes ago, i talked about terry in studio, and macy's earnings, two cents ahead of expectations, revenue shy, perhaps, of maybe the most aggressive numbers. joining us first now on cnbc, the chairman and ceo of macy's, and at this point, looks like the stock opens down in 45 and
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change, and that would be a 52-week low. >> it's the guidance too. >> yes. >> lower on guidance for the full year. >> yeah. >> versus 470 you said earlier. what happened? >> tough quarter. no question. a lot of the themes that happened earlier in the year continued and got worse, particularly the international tourist business, which we are heavily penetrated in, more than others, and that trend just got worse, so that consumer's not here, and when they are, they are not shopping, spending. that, plus this continuation of buying in other categories, sales were good, saw home improvement is good and technology is good. spending money there, but not so much in our category overall, and then, you know, i hate to talk about weather, but jim cramer talked about it a lot, and the reality is, particularly in the northeast, it is much warmer this year than last, and so we expect that to continue.
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those things are just in the going to change dramatically, i don't believe, and at some point in time, you run out of days, you know, to sell through inventory, december 27th comes and volume drops precipitously. earnings is forecast down for fourth quarter because we're going to take markdowns. great for consumers, consumers will have a field day because there's a lot of values out there for consumer, but we're going to get rid of the inventory. >> last time you were on, expected to be cold, and you were glad to sell coats, but it was not cold for long. >> yeah. i almost wore a scarf and gloves on camera to make people think it's cold. >> yeah. >> but, you know, obviously, it's not happening. >> i hope you're not a proxy for the whole economy. you said there's very specific things, but for getting ready to raise rates here, and for the notion that we're 5% unemployment, macy's stock price over the last year does not look like a flush consumer or 3% gdp
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economy either. there's a disconnect there. >> i said this to you in the past. one of the disconnects i see is that productivity is low in declining in america while unemployment is quite low. that's, to me, generally a disconnect. you want to see productivity going up to keep up employment down, and so something i still worry about as time goes on in terms of job creation, is that a factor in 2016? >> given the trend you see in terms of foreign visitors and other things not buying like they did before or not as many people here, is there something you need to do or think about in terms of repositioning the product mix, the markets approach, or anything over 12 months to appeal to a different type of person or product that they may be more inclined to buy? >> well, good news is, andrew, that, you know, the strength of the business, there's not a lot at this point in time, but it's the strength of the business that's coming from the millennial consumer, the young consumer, is finding our stores
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ape it is shopping with us, both in the young men's, young women's category as well as junior businesses, that that business is better than the adult business, one, and so we're just trying to make sure we're shifting quickly and more aggressively towards going after that consumer. we've. doing it, launching a lot of new lines, attracting the young consumer which seems to be working. our online business is growing double digits. you all know that, seventh largest internet company democrat world and growing, probably moving past up a notch perhaps this year looks like. >> there are companies we think of as domestic companies that depend on foreign tourists. >> yeah. >> if i go to paris when the euro's 1.40, that's like a $30 cup of coffee. they come here at 1.06 on the euro, they might not come, and if they do, they don't want to spend. >> in the department stores in paris are doing very well, very
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much linked to the international trade. they are going there instead of here. >> opposite for you. >> that's not going to change. >> not going to change. >> fed raises rates, there's more pressure. >> good news is we're year rounding it. year rounding that trend starting in mid-december of this yearings but it's not dr i don't predict that's getting better over time, certainly over the course of the early '16. >> no way penney's is eating your lunch, is it? >> you mentioned this before the break. listen, i want them to do well because i want them to participate in getting mall traffic, you know, going, but don't forget they dropped $5 billion in 18 month period. not so long ago. their base at which they grow on is, obviously, very, very different than our base or other bases, so i don't want to take credit away from them they are making product, but they have a long way to get back to where they were. >> expected to lose 1.22, next year, expected to lose 43 cents.
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>> any competitors out performing you at this point, you look at say, wow, look at that? >> nobody's doing particularly well. we came out first with the numbers, and so you're going to see other numbers over the next week or two. i don't expect any great numbers. you have. seeing in the past, a trend towards trading down for consumers, and to that point, we have opened the backstage doors, blue mercury business, pleased with, another 40 of those, plus putting in-store installations, but we're not, you know, the things is we take it serious ly not sitting still, aggressive action, we are targeting, going after 2018, aggressive in '16 and '17 as well. >> in advertising? where in the budget? >> that size of the number we go after, becky, it's not one area.
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this has to be across the board. we have to look at all categories of spend. we have to resize, reshape the business, and look across the board. we've done this before. you know, the one good thing about the company is we've seen this move before in the past, and we've responded, and, in fact, some of our best and most innovative times have come from when we have been, you know, pushed backwards and aggressive on moving forward. that's what we do now and early 2016. >> how big a problem is the weather? i started thinking about other retailers that maybe are more exposed to the northwest with snow. is that big enough to see somebody who is concentrated there, a nordstrom or something. >> should be better. business in the west is the best business, whole west and northwest, that's the best. northeast is the worst. >> andrew's buddy, you got 15 app hour in all the stores in
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new york city, would that make a difference to you? >> good news is we're already above minimum wage in our stores, but the truth of the matter is, just as a general question, i worry about restaurants. i worry about a lot of -- >> not at 15 an hour? >> no, not at opening, but i do worry that how are you going to pay for that? you know, how are you going to pay for that? it's a great idea. we would all love to see more wage increases for everybody. we want to see that, but you got to pay for it, and you end up sadly going to pay for that likely with less jobs. >> walmart setting new wages too. anyway, have you thought about my idea? it's expensive, obviously, for you, but huge parade, new york city, you get, you know, floats -- >> have a parade? >> you get bands. >> that could bring attention to the main stores. >> have it go along the street there, invite all the people, and just, you know, macy's parade! macy's parade. >> there's a holiday coming up,
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do it then. >> have you thought about that? >> 89 years ago. thank you, it's expensive, but we'll do it. >> all right. >> if that does not work, what about fireworks in the summer? >> july? >> it's a good month. july is a good month to try fireworks. >> by the way, this is a good point, honestly. >> i have been challenged in the past that in 2001 and 2008 to eliminate the parade and fireworks by different groups of people. >> sure. >> saying you should be spending money at this period of time, and i'll tell you why because the country needs an uplift. >> no kidding. >> this is a time where we shine is when we do events just like this. nobody does them anywhere in the world, frankly. we're not going to stop. >> advertising too. >> terrible. >> sure. >> like telling at&t not to do the pebble beach tournament. let's hope there's never a world where those ideas gain traction. thank you. >> thank you.
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. >> appreciate it. >> great to see it. >> beautiful suit you're in today. coming up, a major blow to the multibillion fantasy sports betting industry with new yorkers in a tizzy. details on that, heading to break, though, special happy veterans' day to all those who served in the armed forces. look at the numbers. 2014, over 19 million military veterans in the united states, 11% of them women, 7.4 million vets in the labor force, and the 9% of them are business owners. california, texas, and florida have the most. "squawk box" weshs each and every a happy veterans' day, and thank you for the service. back in a moment. ♪ do solemnly swear that i will support and defend the constitution of the united states against all enemies foreign and domestic... ♪
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♪ ♪
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new york ordersing fantasy sports websites to stop taking bets in state. in a letter to draft kings and fan dual, new york attorney general calling the betting operations essentially illegal gambling. nevada took a similar action against the popular sites last month. they are fighting back. draft kings pursuing all legal options to ensure customers in new york state can continue to
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play. they call the move political? >> political. >> they did. not me. somebody else. >> method making cleaning products making the planet a cleaner place. the cofounder is joining us on how to take on dirt with the environment in mind, and later, an electronic dj on his base thumping fist pumping rise to one of the highest paid djs in the world, the rise of electric, and why fans pack stadiums to see him spin. we'll -- he'll be our special guest in the next half hour. you're watching "squawk box" "squawk box" on cnbc, first in business worldwide.
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method, the cleaning brand company, cleaning the dirtiest apartments in chicago, grew from a tiny startup to $200 million in sales. the cofounder is joining us now on the site of cnbc and ink magazine's iconic conference in washington, d.c. good morning to you. >> good morning. >> thank you for being here, eric. so give us -- give us the story. we love to hear sort of a great success story. how did it happen?
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>> you know, adam and i really saw an opportunity to disrupt the category finding tired categories, see the culture shift missed, and reinvent had. we had the opportunity to do that in tw2001. >> you like to disrupt things. is there more coming? >> oh, yeah, clearly we're at the right conference for that here, and i launched a new brand called ali with a similar approach of going in and really trying to reframe and change that nutritional supplement aisle. >> and long term for these types of bets, do you think that you can actually afford to be independent, or do you think, ultimately, it's selling to the big guy? >> yeah. it's, you know, there's such a huge consumer shift going on right now, and that's a lot of what we're trying to execute against. i think huge companies are
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really misunderstanding how much millennials are changing the landscape of consumer products in retail. we are trying to create authentic brands, different, connecting with a younger audience with a product proposition that stands out. >> right. you are at the conference. what's the conference about? what are you looking for? >> so, we're in washington, d.c. i apologize, it's hard to understand, but we're here in washington, d.c. for the iconic cnbc conference. >> and this is about disruption, this is about millennials, intern nuentrepreneur entrepreneurship, any panels you're looking forward to? >> yeah, it's just great to spend time with other people going in to change industries and gives us courage to keep doing what we're doing and be different out there. >> you said something about millennials, i wanted to ask this from a perception p perspecti perspective. there's the big, large, traditional established companies and newer starts.
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do you think that millennials have a preconceived notion or negative bias against sort of the old incumbents? >> yeah. well, i think part of it is that any time a new generation comes in, a lot of what they are bringing with them is different media habits, to a lot of these largest established brands, you know, were created in mass media and in the 30-second spot. it's not necessarily bias against the big brands, but it's the lack of the big brands really connecting with millennials, and even gen-x through new emerging media. >> and, finally, real quick, you know, one of the conversations we had, a silicon valley conversation, but the private market versus the public market, and the valuations of the unicorns. you're in a more traditional space, so not unicorn territory yet, but what do you think of what's going on? >> no. i mean, we're seeing
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particularly within wellness, millennial driven brands, valuations are get r much more froth ty because the large strategics are starved for growth, becoming more and more dependent on new emerging brands, and there's this scarcity value in that. i think we continue to see strong valuations in the private sector for wellness driven brands, and i think it's -- i think it's well deserved right now. >> okay. leaving it there. good luck today, looking forward to it. thank you. >> thanks for having me. coming up on make a deal in the brewery business, a speech by draghi, and dollar index at the highest since april in growing expectations of a rate hike next month. what matters to your money. equity futures uple 0 points on the dow.
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welcome back to "squawk box," a live look at denver. >> nice. >> my nephew lives there, born last week. very exciting. >> last week? >> what's the name? >> i did. >> what's the name?
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>> ben. >> ben. did we know? >> you didn't have a name. on set, we didn't have a name. >> i missed this. >> was born, not on the set, but while we were on the show. >> while on the show. >> oh. >> and in the meantime, headlines this morning, it's a normal day for the stock market, but the bond market banks and post offices closed for veterans day, and, also, apple music is available on android today, four months after it first debuted, of course, on the iphone, today is the day that apple's larger ipad pro is on sale. mortgage applications fell 1% last week, according to the mortgage bankers association due to a drop in refinancings. average rates rose from just above 4%. >> dollar index hit highest level since april, diverging policies between the fed and european central bank, joining us, mark chandler, and also,
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gina sanchez, chief executive officer and cnbc contributor. folks, let me ask you, you know the dollar is stronger and stronger, and people assume the fed's going to raise rates and european banks continue to add liquidity to the systems. makes it seem like a crowded trade that everyone is going to be thinking, mark, that the dollar's going to be long. any reason to bet any other way? >> i don't think the timing yet is to bet any any other way yet, and in the mop tear cycle peaks, hard to say the dollar piques. i don't think it's discounted already. i think the incementive structure, that's given to us by the interest rate differentials. pay people to be long on the dollarment it's not just old money moving on the dollar, but new money, hedging decisions, investment decisions influenced by the incentive structures, the differentials. >> you think that's the right way to see it, though, not an alternative version of the events? >> well, i think the alternative
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ver version is the federal reserve disappoints us. that does not happen. what we do now is debate is moving two to things, one, if the fed takes off, liftoff in december, how fast do they raise rates? when does the cycle pique, and, also, who is next. that's why it's holds up well in face of the dollar because the u.k. is the second largest country to raise rates. >> interesting. >> what's your view of the world now, gina? >> well, i agree with the comment, and, you know, i would add, though, that the challenge to presents to the market is that a continued strong dollar does continue to make earnings a little more challenging because it does make our goods more expensive in the market, talking about up to 45% of earnings, and let's not forget that. i think that the markets right now are incredibly concerned, however, that if the fed lifts
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off, look, we know that it's probably going to be very slow, at least everybody believes that, and that's our belief, that the fed is going to go very, very slowly, and that the actual pique as mentioned before is far off, awhile before we see that. really slow. does it matter to corporate financing? probably not. you know, there's a lot of concerns in the equity market that, in fact, earnings are way out ahead of themselvethemselve. >> my guess is when everybody sees the market one way, if there's any sort of short term d divergence from that, if they don't raise rates, something else happens, there's a lot of money rushing very quickly in the other direction, not over the long term, but short term moves, type of volatility if things do not go as planned, gina, do you agree with that? >> i do agree with that, and i think the direction you see is a pop in the markets relief rally
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rather than the other way. now there's nervousness in the markets, and we're, you know, i think that that continues to build until we finally get past december. >> marc, you mentioned the british pound is an interesting play because you're gaming out who is the next central bank after the fed raises rates. what do you think beyond that? a third alternative play? what do you do in terms of something like the yen or euro? is that just almost dead money for a while? >> yeah, i mean, i think that in the big picture of things, this is what i think a lot of it is, not all investors are short term hedge funds types, looking for the next half percent, but think about the next year or two years, you have to anticipate dollar trending higher. bank of japan says a couple weeks ago they are not going to ease again, but many people think they will either in december or perhaps as early as next year, but december is the month to remember because the ecb could be easing two weeks before the federal reserve lifts off. i think that that -- for the next year, it's going to be a
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story about the federal reserve and other countries easing poll city, but after next year, i think that we are looking at other countries. i'd have canada as well as -- leaving aside the emerging markets, but canada is the third or fourth country after the federal reserve to raise interest rates. >> okay, marc, gina, thank you both. >> still to come, a dj making millions by packing stadiums for electronic dance festivals. the entrepreneur. >> he's outside. >> joining us after the break, but see the infamous jump. there it is. we'll ask him about that when we return as well. "squawk box" will be right back.
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♪ welcome to "squawk box" this morning, electronic dance music industry is close to $7 billion, and one the biggest superstars and draws on the live fest call circus steve aoki is here, and he's been here in the music industry since he was a tarchs. steve is here. he's collaborated with everybody from, and spoke
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yesterday in new york with bill nye the science guy. what was that conversation like? >> it was interesting. the guy is -- he's, like, very witty, digresses into any topic into his own entertaining, finding relevance in practicality with everything, whether how you tie your tie, explaining the right way to do it or the more effective way to do it and the science behind that. you know, it's, like, one of the conversations. >> tell us this. you are both an entrepreneur in businessman and also a musician. how much time do you spend on each? how do you, like, split your brain in terms of label versus everything else? >> like a mashed pot, inspiration finds me, so, you know, i go with where my passion's going, and with my, like, my culture, it's, you know, i mean, everything we do
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is, like, we're always going to entertain the stuff that's around us. >> right. >> so whether it's music or whether it's fashion or any sort of business that's involving that, i'm going to use whatever's in front of me. >> one of the debates we had a lot yesterday, just had it yesterday, is sort of the health of the music business. not the live business. >> right. >> business you to hustle to make work. >> yeah. >> but whether spotify, now on apple music, and whether this business is good for musicians. >> yeah, i mean, there's still an income stream. you can't say we don't make money from that, because we do, but for myself, i don't look at, like, okay, i got to get that check to make it through. it's definitely more of a pension plan, you know, like, i mean, i'm doing a service when i play a show, and that's really where the immediate income stream is coming, you know, into the whole enterprise. >> right. >> i do that, and then the music
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is what drives people to the shows. you know, at the end of the day. >> as a lead in bringing people in, almost. >> right. >> we talked about how hard you work with that, how much you're traveling, how much you're on the road, and there's not a lot of sleep. >> no. >> reporte >> that lifestyle. >> you have to accept a different lifestyle. you know, it's not -- the balance between being at home and touring on the road, that's harder than just being, okay, i'm on the road. then you've accepted, like, jet lag is one of your biggest problems that you face, and learning how to take your naps and learning how to adjust your schedule to your work. >> how much of your decision, then, to do the residency in vegas was part of just, i don't want to be on the road in the same way that i was? >> yeah. well, i mean, that was practicality. i moved to vegas for that reason. >> right.
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>> and it's -- everyone goes to vegas. >> big money in vegas. >> yeah. >> paid like $200,000 a night? >> well, we don't disclose that information, but -- >> that was in some of the reports. >> you know, at the end of the day, like, you have a big weekend, a bachelor party, there's always some reason why you're going to end up going to vegas for that one crazy weekend with your friends, your spouse, whatever it may be, and it's -- you get a whole slice of the world coming there. >> right. >> so the weekends are -- >> i don't know if you can see this, and i mentioned money, and you may not want to talk about money, but there's huge money in this business in a way that there was not five, ten years ago. >> right. >> what do you think happened? how has this happened? how do you, plain it? >> it's economics in the end, too. we're not just getting inting other people are paying us because there's a -- there's, like, a -- there's a model.
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>> another issue. >> there's a model. you have festivals where promoters pay artists, and ul the people come and pay ticket prices, and then, you know, if they were not paying the artists, they are holding the cash, so it's -- the djs are actually having more power in saying, hey, actually, we need to get paid more than giving us five grand and a bar tab. >> right. >> you know, like, we are -- we are bringing in this many people. this kind of money. >> what do you say to djs are not musicians. you heard that before. >> of course. as long as i can do my thing, as long as i can tour and produce music and all this stuff, you can say anything you want, you know. i mean, you're going to get criticings and haters in all business. people might not like the blue tie, you know what i mean? >> that's business. >> he's been sarcastic. >> no haters in the business. never seen it. never experienced it.
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>> talk about not sleeping, you're involved in a documentary called "i'll sleep when i'm dead," what's it about? >> documentary working with a team for close to three years now, following me around, and -- >> here today? >> they are -- no, that's just my own -- >> that's your own crew. they follow you everywhere. there's cams ra that go where you go. >> yeah, i live a crazy life. it's something i don't want to miss out on. i've had a blur of time spent traveling the world, and, like, okay, let's document the amazing stuff we see, all the cultures we're a part of, the magazine people we meet. i mean, i try to take advantage of that when i can. >> a sneak peek on new collaborations you are working on? anything like that? >> just released my album, you know, future odyssey, a deluxe package of both albums released in the previous year with new music, and one song, i can say, it's a big homage to celine.
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i met her in vegas. >> did you see the show? >> saw her show, more importantly, the show is her as a human being, just so kind, so funny, and so just open -- like, you don't -- you step into a room like that, like, this is celine, you're a megafan. you don't know what to expect; say they hi, good-bye, and that's fine with me, but they started rapping, curious to see what you're doing with music, the music i was using for her for my set, i was just blown away. >> a real person. >> yeah. >> when you travel around the world, and, obviously, huge in america, are there other markets where you are bigger, or is this the king? i mean, must be different where every you go. >> i say the spanish speaking sector of the world is a big fan base for me, like, central america, south america, spain,
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asia's also a huge, huge growing, growing scene of dance culture there. i go out there a lot. i live in spain four months of the year. it's -- it's definitely a global culture. >> right. >> awesome. thank you for coming in this morning. ? thank you. >> this is cool. this is past your bedtime, but before your bedtime. >> i'm awake, feel alive with you guys. >> appreciate it, thank you. >> when we come back, cramer from the new york stock exchain. the futures green, continuing now with dow up by 71 points, and s&p up by 7, and nasdaq up by close to 20 opportunities aren't always obvious. sometimes they just drop in. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets
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. all right, stocks to watch, apache shares down after sending the company a nonbinding offer to acquire it, but rejected. it's now withdrawn that bid. anadarko said it was an all-stock proposal, with a modest premium, and is not pursuing a deal without access to detailed non-public information, and it says its analysis suggests that apache
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creates at or near full value currently. all right. let's get down to the new york stock exchange. jim cramer joining us now. that was a weird -- what i just heard, you were aware of that situation, jim? so it was situation? it wasn't like your normal -- bear hugs usually cause a stock to go up. we're already -- was there conjecture this was happening? >> there was. this was odd because apache has come down a great deal. i thought it was a good opportunity for anadarko. just go in and go out? why? this is a great combination if you think oil will stay low longer. these two companies teaming up will be fantastic. apache has a new ceo, he hasn't been in that long. maybe the guy wants to give it a shot that stock down 100 points. they did something for you. >> we had terry lundgren on, had not followed the stock that close. will hit a new low today. >> i think the weather has hurt
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them. people were expecting to have real estate investment trust deal. point blank just said that is not going to happen. i think that that's going to disappoint some people. at a certain point, you have to say it is going to get cold again, they will be relevant. they're a very good chain. then people see jcpenney's numbers, and they say is jcpenney taking away from macy's? i think terry is doing a good job. but there are fates against him. the worst one is the fact that i am still not wearing an overcoat. >> yeah. i know, that's true. i wonder if we can deduce anything else? walmart. there's other factors obviously. but it doesn't look like an economy headed to 3% gdp. and amazon goes up every single day. morgan stanley raised its target price to 800. the thing is a juggernaut. i don't know. if i'm in retail, i hate amazon so much. i don't know what i would do.
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>> we'll be tuned in. you have jack ma on later. 9:30? >> yeah. they say they're not amazon. point blank, we're not amazon. which is fine. room enough for another river. >> i guess calling it the anti-valentine's day. something about that sounds sort of -- valentine's day is so romantic. i don't want an anti-valentines day. >> he says life is just a box of chocolates. he's kind of a forrest gump guy. he has that covered. >> i don't want to be cynical about -- i love my valentine. any way -- >> but you have a valentine. >> i do. >> we have mcdonald's on. >> mcdonald's on, too. wow what is that. >> egg mcmuffin. >> nas to me. pass that to me. can you -- how far are you from us? no, you can't be here in seven minutes. jim, thank you. we'll see you in a few. >> you're welcome. >> up next, we spoke with ceo
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terry lundgren a short time ago. reaction to the numbers and his interview after the break. "squawk box" will be right back. so what's your news? i got a job! i'll be programming at ge. oh i got a job too, at zazzies. (friends gasp) the app where you put fruit hats on animals? i love that! guys, i'll be writing code that helps machines communicate. (interrupting) i just zazzied you. (phone vibrates) look at it! (friends giggle) i can do dogs, hamsters, guinea pigs... you name it. i'm going to transform the way the world works. (proudly) i programmed that hat. and i can do casaba melons. i'll be helping turbines power cities.
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i put a turbine on a cat. (friends ooh and ahh) i can make hospitals run more efficiently... this isn't a competition!
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. december 27th comes, volume drops off. earnings is forecast down for fourth quarter because we'll take markdowns. great for consumers. consumers will have a field day because we'll have lots of values out there for consumers, but we'll get rid of the inventory. >> that was terry lundgren, macy's ceo explaining why they are taking their guidance down so sharply this year. you can see the street has not reacted kindly. stock down by 8.25%. down to 43.10. joining us on the squawk news line is dana telsey. it wasn't the current quarter so concerning, but a miss on sailings for the current quarter and the guidance for the full year that's probably catching the street off guard. what do you think of all of it? >> i think macy's did come in weaker than expected. the tourist markets got impacted. core category, apparel and accessories face a headwind.
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think of that center floor. they're left with inventories now, exactly what terry said, just under 5% it will be markdowns and pressure on the gross margin in the fourth quarter that's leading to this reduced guidance. it's a challenge. it's macy's and other department stores also where there's issues with those in flagship cities that's been a problem. >> is it a problem that shoppers are not going into the stores? is it a problem that consumers still are not spending on some of these items even though we expected them to because they were saving so much at the gas pump? what's happening? >> i think it's both. overall, the whole apparel category and the accessory category, we've seen slowdowns in growth rates. when handbags had been a high single digit grower and now is a low single digit grower that first floor brings people up to the other floors. there's more competition out there for better quality. and look at the choice that consumers are spending on whether it's travel, technology,
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whether it's upgrades of their iphone. in order to gain share and gain consumer dollars you have to be innovati innovative. one thing you see macy's do on the millennials floor that opened last week, it will be interesting to see if a year from now that helps drive sales. apparel and accessories has had a tough go in 2015, it's tough for the holiday season and the third quarter earnings season. >> you just mentioned a year from now. are you talking about a problem that lasts well into next year and beyond? >> no, i'm just talking about some of the new initiatives that macies is doing. they maybe open restaurants on that one below floor that they opened on 34th street in order to bring traffic there. the new initiatives they begin to scale as they move on. the weakness in earnings, it's the fourth quarter hit of
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getting rid of the merchandise to stay clean on inventory. >> you have go back to 2013 to catch the stock at these levels. what would you do here? buy or wait and see? >> overall you have to wait and see. fourth quarter still will be a challenge. you want to see what the guidance is for 2016. and as we come up with our own numbers of what 2016, long-term investors for a company like macy's, this is an opportunity because there's margin opportunities ahead and all the sales growth initiatives they had along with the opportunities on the expense savings side. they're taking out another $500 million. >> dana, thank you. >> thank you. among the other stories we're watching, inbev announcing it's finalized the bid for sabmiller. $66.70 per share, or more than $105 billion. the combined company would make about a third of the beer
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consumed word wide. sabmiller in miller coors will be sold to the joint venture morris coleson in order to appease veterans. happy veterans day. thank a soldier today. make sure you join us tomorrow. "squawk on the street" begins now. ♪ good wednesday morning. welcome to red s"squawk on the street"s is, i'm carl quintanilla with jim cramer and david faber. steve easterbrook is here following his company's investor day. later, jack ma, more than 12 billion in sales and counting on singles day. ma is at beijing's national aquatic center. we see him on the right where alibaba is hosting its global shopping festival. he will ring


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