tv Squawk Alley CNBC February 2, 2017 11:00am-12:01pm EST
patriots, and the patriots are united around hating roger goodell. back to you. >> although they just got a shout-out from rex tillerson. jane wells, thank you very much. now to carl for "squawk alley." >> all right, sara, thank you very much. good morning. it is 8:00 a.m. at facebook headquarters in menlo park, 11:00 a.m. on wall street, and "squawk alley" is live. ♪ ♪ good thursday morning. welcome to "squawk alley." jon fortt, kayla tausche and myself at post 9. henry blodget, business insider,
joining us here. there are reports that alphabet and other tech companies drafting a letter opposing the administration's temporary immigration ban, according to recode. an early draft -- "we are a nation made stronger by immigrants. as entrepreneurs and business leaders, our ability to grow our companies and create jobs depends on the contributions of immigrants from all backgrounds. while security and vetting procedures can and should always be subject to continuous evaluation and improvement, a blanket suspension is not the right approach." as the president prepares to welcome key members of his strategic and policy forum to the white house tomorrow, henry, how important is it that these companies are getting together to write a letter, some argue, as strongly worded as this? >> i think together they do have a lot of weight. if it were just one, it would be much less so, but these are incredibly important companies to the economy. they're right in saying immigration has really strengthened the technology industry, which is one of our best industries. so i think together they'll be listened to. >> is there a sense that if you're canada or mexico, you're
putting in a call to the ceos of these companies to say build an engineering office here, bring your people here instead, make it the americas office and not necessarily just silicon valley? >> i don't know that you get that call immediately, but these are global companies. they can put people anywhere. if great engineers are in india, they will build out that facility if they're not allowed to bring people into the united states. so if the trump administration wanted to try to prevent that, he would have to do a lot more than just say this particular country is off limits. >> thus far, the response seems to have evolved from, well, let's just see, to people in these companies, including twitter lately making individual donations to organizations like the aclu, to now these kind of united front responses. where do you think it goes from here if tech and big business in general don't feel like their feelings are being reflected in the trump administration's policy? >> well, we're going to have the big meeting today or tomorrow with a lot of ceos with president trump. he does listen in those,
clearly. at least that's the story that everybody tells after the meeting. so maybe there will be some influence there. but one of the interesting things about the immigration ban is nationally there's actually a lot of support for it. so this is a national conversation, and they're very clear on their view. >> a lot of support for restrictions on guns and automatic weapons as well, but that doesn't happen. so i don't know -- >> this is true. this is true. >> you said that candidate trump was smart. president trump is pushing anti-american policies, but he's all about america first. why is he -- >> well, he's saying that, but on the other hand, if you want to crusade against the media and say it's biased, the only truth is the white house, i'm sorry, that's just an anti-american attitude, anti-american to bash the media all the time. sure, one organization, one story, maybe you say a particular outlet is biased, but to trash the free media? come on, that's anti-american.
we've had that from the get-go. >> you're not going get a lot of arguments at this table. that's a discussion for another time, perhaps. we do want to hit on facebook today, topping estimates, of course, and that mobile ad revenue strength continues to astound a lot of investors, but not to the degree it did last night. julia boorstin has more on that this morning. hey, julia. >> reporter: hey, carl. facebook beat estimates on every single metric -- revenue, earnings and user growth. i speak with coo sheryl sandberg yesterday who said the out-performance was thanks to three factors -- one, growth in the community on facebook and instagram, businesses making the move to mobile on facebook and instagram, and ad dollars following, and a strong year for product announcements, including the big success of instagram stories and growth in video. sandberg along with ceo mark zuckerberg on the earnings call last night stressed the massive opportunity in video, saying they want facebook to be a destination for video content from both friends and professionals, which is why they're investing in content and sharing ad revenue with
creators, saying they're committed to a great video experience across platforms. the stock is trading near a all-time highs. they did give up gains after last night, david a winner reiterated that revenue growth will decline meaningfully in 2018 while they ramp up expenses. analyst reactions are largely positive. goldman points to facebook's ability to effectively target ads as a growth driver, and morgan stanley says that facebook's video focus could lead to higher monetization. one downgrade from pivotal research cited guidance on expense growth and expenditures higher than forecast. investors are looking forward to snap inc.'s public filing expected in the next couple days. we'll have to see if facebook's success with features similar to snap chats, such as instagram's stories, are impacting snap's growth. back to you. >> that's a lot. julia, thank you. one of my favorite metrics, henry, four years ago, percentage of revenue on mobile, 23%, now 84%.
>> it's staggering. remember after the ipo when the stock was in the teens. mark zuckerberg came out and said you know, we think mobile will one day be bigger than desk top. a lot of people laughed, and here we are. it's just extraordinary. we see this every quarter, but this company is executing so spectacularly across a whole number of fronts. and one of the things that came out on the call was this emphasis on video. and i can say, from being a facebook partner, they are very serious about that and they are very serious about working with video producers to create a great experience. it's not television. it's native facebook and it's social, but it's getting better all the time. >> and their context is growing pretty decently, too, though. how much of that do you think is just smart earnings management? because they often say, hey, we're going to spend a lot of money this year, so hold your horses, and then they don't spend as much as they said. and how much of this really is pursuing some of these video initiatives that they say are important to their revenue growth? >> they're doing an excellent job managing expectations. they have for many quarters, so
that's good. on the other hand, they should be doing what they're doing in terms of spending very aggressively. they get a 50% profit margin. that is exceptional. we could take it down to 25% and it would still be spectacularly profitable. so if they see a huge opportunity going forward, it would be a big mistake for them to say, no, we're going to maximize profits in this quarter. so, i am as a long-term facebook fan totally behind them spending a lot, if they see the opportunity going forward. >> you think back to the ipo and so many skeptics looked at the headline and said facebook wants to be a blue chip, and they laughed and said social media is a fad, it's a flash in the pan. but the success they've had and the fact that their stock price has nearly quadrupled, do they set an impossible bar for snap? >> they've set it tough for snap, yes, in particular with facebook. they are doing all the right things for long-term growth. the stock still trades at 60 times earnings. eventually it's going to trade at 25 times earnings. that's just what happens. so hopefully it happens slowly,
multiples compress over time and you still get some appreciation. but as growth slows, that's going to happen. snapchat, look, snapchat is also an incredibly powerful force, great company. we'll finally get to see the financials, which will be very interesting, but it's not necessarily either/or here. they both can succeed. >> although people are going to ask, right, when they come public, is it facebook or twitter or something else. >> as they should. and facebook's actually been directly attacking snapchat for years since they reportedly tried to make an offer to buy them and rebuff. and based on some recent statistics, they are making some headway. but i can tell you in our household, snapchat is still very popular with other than me. my son figured out how to use it, really. although it is an issue. >> the company's trying to say most of our growth has come from users over 25. we're not just a millennial tool. but what do you think is the most important metric for them to put up in the echelon? >> user growth is very important. you'll remember with twitter,
user growth started to slow and some of the bulls said, but look at that revenue growth, 100% year over year. eventually, the revenue growth's going to be capped by the user growth. so user growth is strong, and they're early in the monetization curve. that bodes very well for the next few years. if facebook continues to nibble away and you see usage start to drop, that's a huge warning sign. >> henry, a lot of ground covered. thank you. >> good to be here. >> henry blodget at business insider. the president sits down with executives from harley-davidson today and other top union leaders. the head of the united steelworkers joins us to discuss that. a volatile few days of trading since the president's executive orders. the chief strategist at td ameritrade will join us. and later, paul ryan speaks about a busy week in washington. his comments live in a few moments. >> announcer: post 9 is sponsored by fidelity investments. innovative ideas for serious investors. nt"$7.." e'of epyoad
out of all your services, like xfinity x1. we'll put the power in your hands, so you can see how x1 is changing the way you experience tv with features like voice remote, making it easier and more fun than ever. there's more in store than you imagine. visit an xfinity store today and see for yourself. xfinity, the future of awesome. president trump meeting with key executives from harley-davidson and manufacturing unions today as part of his manufacturing jobs initiative, part of that america first policy. joining us this morning, leo gerard's international president of the united steelworkers. leo, good to have you back. good morning. >> good morning. good morning to you. >> harley's an interesting case because such an iconic american brand headquartered in such an important state politically. what is on the agenda, first of all, do you think? >> look, i'm not sure what's on
the agenda, but we weren't contacted by the white house. in fact, they've invited the president from our plant in milwaukee, and i think the president from the plant in york, pennsylvania. harley is an iconic brand in america, but one of our concerns right now with harley is in recent years they've been starting to import parts from china, and we've been trying to stress to them that in the long run this will damage the brand, that the reality is that we've said for a long time that harley was, as you said, the iconic american manufacturing success. when harley was in bankruptcy, god, i lose track, almost 25 years ago, the labor movement help helped, and a trade case against the japanese helped to pull harley out of bankruptcy. and part of the way we did that was to talk about how this was a
made-in-american, first-class motorcycle, and the brand came back roaring. so now we're a little concerned, and hopefully, the president will talk to them about that and they'll talk to the president about that. >> leo, during the campaign, in the waning days there was a bit of a dust-up between the steelworkers and president trump. of course, we remember chuck jones of local 1999 talking about the issues at carrier. you brought up the fact that trump himself has used imported chinese steel in some of his products. and i believe you were quoted as saying that trump is "nothing more than a hypocrite and someone who we should not trust whatsoever." now, though, he's talking about making keystone pipeline pipe in the u.s. that could benefit the union. is it possible to mend fences here? >> well, look it, right after -- let me back it up a bit. we certainly weren't as nasty to the president as some of the republican candidates were. but right after the election, we
sent him a letter, because we said, if you're serious about repealing nafta, we're with you. if you're serious about taking on china, we're with you. if you're serious about rebuilding america's infrastructure, we're with you. and to the tune of the things that he wants to do to rebuild manufacturing, i think that that's incumbent on him living up to that promise and put people back to work. that's why he won the election. if you go through the industrial heartland, what you'll see is that people who have been worried about their job -- they go to work on monday, wondering if they'll have a job on friday because of rotten trade deals with mexico, with permanent trade relations with china, in the wto, with south korea. all of those bad trade deals have lost millions and millions of jobs. just this week, the economic policy institute put out a report that said we lost 3.5 million jobs to china in the last ten years. so if the president's prepared to take that on, he can consider us an ally on that and we'll consider him an ally. >> right, but leo, how
consistent do you think the president's approach to unions and to labor issues will be? because you mentioned some of these trade deals that he wants to rip up that unions have not favored for some time. he's talked about wages. he's talked about wanting to bring those jobs back. but on the other hand, people point to his labor secretary pick as someone who is against wage hikes, who's against certain employee protections, and i'm wondering where unions draw the line and how you pick your battles. >> well, look it, i can tell you that we're very, very disappointed in the nomination -- in fact, we're disappointed in several nominations, but in particular the one for labor. it's mind-numbing that a guy is going to be secretary of labor, said he'd like to be able to replace his workers with robots because they don't take a break and they don't need a rest. i think that that position, that secretary of labor is, as you put it, he's directly different from what president trump has been saying, and president trump has said that he wants not only
to bring back industrial manufacturing, but he wants to have higher wages. well, hopefully, he'll get a chance to fight for a higher minimum wage, he'll get a chance to direct his secretary of labor to do things that will be able to strengthen the ability of workers through collective bargaining to raise wages and bring about more income inequality. right now we've got the most inequality we've had in the last 75 years. >> leo, one last question on trade in general. does the union worry at all about this america first policy discouraging foreign investment? i mean, there's workers in spar spartanburg who are grateful to bmw, but should they be worried that job is in jeopardy because of this some say antagonistic view? >> well, look, if our preference is to grow existing facilities that already xest, in the parts sector, steel, aluminum, paper, we want to grow existing
facilities, but if there will be foreign investments and work for high unionized jobs, we'll be for that. it doesn't matter. aufz seen, we've had relations with global companies. we've got good collective bargaining relationships and we'll be able to raise wages. but the preference we have that we grow the existing facilities -- the steel industry now -- just to make this point -- ten years ago the steel industry in america made about 125 million tons of steel. we now make 85 million tons of steel. ten years ago, china made under 500 million tons of steel. now they do 1.2 billion tons, over 400 million tons of overcapacity, depressing prices in the steel industry, all around the world. they're doing the same with aluminum and with paper. so, if we can stop that destruction of industrial jobs because china cheats, we can grow the steel industry back without building new plants. we can grow the paper industry back without growing new plants. we can grow the aluminum
industry. we had 14 aluminum smelters ten years ago and now have 4. china produces 32 million tons of aluminum when they only need about 7 million tons. so these are fights that if the president takes them on, he'll have a good ally with us. >> you do sound a lot like what we're hearing from the white house these days, leo. >> uh-oh. >> it's going to be interesting to watch. appreciate your time. leo gerard with the steelworkers. >> looking forward to it. still to come on "squawk alley," volatility spiking this week following the president's controversial immigration order. td ameritrade's chief strategist weighs in on that and more next. and a tough quarter for deutsche bank. details coming up in the european close. stay tuned.
with a special guest. >> that's j.j.kennehan, tj ameritrade's strategist, joining me out here by the pool. one of the seeming disconnects in the market is the market's been relatively calm, volatility levels have been subdued with some flurries with individual companies and sectors, despite what's perceived as a lot of policy flux coming out of washington, a lot of what seem like they should be destabilizing messages they should be from the white house. how do you explain what the markets are thinking and where the market is pricing? >> i think two things are happening. first, like you said, we're in flux because the fed after the last 2 1/2 years being 1 a is now 1b behind policy. everything is about policy. what you're seeing with the vix is interesting. while the levels are not increasing in the vix, what you're seeing is people selling cost, willing to give "cnbc news updat update"side to protect downside. it's almost like the yield curve. you're seeing a shift in the
curve, known as rescsku. the volatility level's not necessarily increase, but people are still buying protection. we're at all-time highs. i think people are struggling with what do i do from here. and we talked about the fed put for so long. i think there's almost a text tax put right now. if we can get the tax policies through that president trump talked about on the campaign, i believe that's what's keeping support in the market. people believe if that happens, we have the potential to explode to the up side. >> i wonder your view on investor positioning. you've seen the surveys surge in terms of confidence levels with individual investors, professional investors. basically a similar message saying look, it's a new investing regime under trump. now, is money following that sentiment? in other words, are you actually seeing investors get position either in higher-risk areas or for more growth? >> i think the position for more growth. talking to all the -- you know, we had over 2,000 registered investment advisers here, and
one of the messages they're talking about is their clients are calling more often, very excited about what's going on. and one thing i'll go back to on a bigger picture is think about the ceo calls of the last nine months. nine months ago, they were like, we'll continue at this rate and do okay. now you hear we expect growth. jamie dimon talked about the fact that the u.s. is poised to grow big. asia and europe are growing small. i think there's a change in how the ceos are looking at everything. >> j.j., thanks a lot. you people should check out the fun game you have with a tool about social sentiment, ranking super bowl ads. >> this sunday we'll do something through social streams, follow nicole and steve on twitter. we'll follow the super bowl ads. dorito has a big one. how will the ad affect their parent company in pepsi? it's a way to show how the ads are used and how the companies perform. >> carl, back over to you. >> j.j. knows football, we know that, mike. thank you, mike santoli.
we'll get the european close in about 4 1/2 minutes. seema mody's at post 9. >> we have a mixed session in europe, some gains across spain and the uk but a lot of attention being put on the pound. the pound decline accelerating after the bank of england left rates unchanged in its most recent policy meeting but raised its short-term growth forecast. it also said it's willing to tolerate running its inflation target above the target over the coming months. those comments a bit concerning. governor mark carney also made some interesting comments about how we are coming to the last seconds of the central banker's 15 minutes of fame, perhaps highlighting the rebound we're seeing in growth and inflation and shift towards fiscal policy, which of course is being well telegraphed in the bond market as well with yields on the rise, not just in the uk but across europe. now, speaking of the uk, an update on uk politics. british government publishing its white paper on the brexit after parliament provided overwhelming support for the
bill that enables the government to trigger article 50. that basically emboldens theresa may's position to push forward with the brexit process in march of this year. now, when it pertains to financials, deutsche bank is in focus, reporting a second full year net loss, earnings hit by litigation, restructuring costs. this also comes after many analysts were expecting an improvement in profitability from european financials with those yields on the rise, but perhaps for germany's largest bank, it will take a bit more time. shares down as much as 4% on the day. commerce bank, hsbc also lower. on the m&a front, reckitt benckiser up about 4% after they said they are considering buying baby food-maker mead johnson and nutrition. m&a is hitting an 11-year high in the month of january, so perhaps for these companies it's not impacting dealmaking at this point. >> thank you, seema.
and still to come, iac profits soaring in its most-recent quarter. the company owns brands like home advisor, "the daily beast" and vineo. we'll speak exclusively with the ceo coming up after the break about advertising online video and a lot more. but first, we're moments away from house speaker paul ryan's weekly briefing. we'll bring you those comments live. much more "squawk alley" coming up next.
good morning once again, everyone. i'm sue herera with your "cnbc news update." defense secretary jim mattis meeting with south korea's prime minister in seoul. on the agenda, the trump administration's policies on asia as well as reconfirming strong u.s./south korean ties. more than 100 workers were injured following a huge fire at a factory south of manila. amateur video shows the flames and the thick, black smoke billowing from the site. three people remain missing. israeli forces removing the last remaining settlers from two buildings in the west bank outpost of amoamona. benjamin netanyahu vowing to build a new settlement as soon as possible following the court-ordered demolition of the illegally built outpost. and we might be in for a long winter. punxsutawney phil saw his shadow early this morning. look at that poor guy. and that means we're in for six more weeks of winter. groundhog day has been celebrated in the u.s. since 1887.
that poor guy. that's the news update this hour. back downtown to "squawk alley." dragged out of his cage once a year. poor thing. >> that seer of seers, sue. thank you, sue herera. we're moments away from the house speaker's weekly news conference. when the q&a begins, we'll take that live. meantime, eamon javers outside the white house as we get ready for this meeting between the president and some harley-davidson executives. that's been moved up to noon eastern time. eamon, good morning to you. >> reporter: good morning, carl. we're keeping our eye on the street outside the white house to see if we can see those harley-davidson executives rolling up to the white house here and also as you talk about paul ryan, he's been on talk radio already this morning talking a little bit about what the president had to say and what this white house had to say yesterday about iran, as general flynn came to the white house press briefing room to say that the u.s. is putting iran on notice. not a whole lot of detail about what "on notice" necessarily means, but paul ryan supporting that statement in his comments on the radio this morning.
we'll wait and see if he supports that again today. but there will be a lot for the press to ask him about, including the president's apparently contentious phone call with the prime minister of australia this week. that's getting a lot of attention this morning. and then, obviously, we are waiting for this meeting tomorrow with a whole host of ceos who will be here at the white house. there will be some questions from those ceos we are expecting on the issue of immigration and the executive orders that the president signed last weekend. so, all of that sort of in the mix here for paul ryan as we watch this fascinating relationship where paul ryan and donald trump not necessarily on the same page during the presidential campaign, but now these are two political leaders who very much need each other to accomplish their respective agendas, but you do sense there is some distance between them. paul ryan also saying at some point today that he's growing to appreciate the tweets from the president, and he said this will be an unconventional presidency, something he's said time and time again when asked about donald trump. so, watch this relationship,
because that will be the key to whether any tax deal or anything else can get started here. >> eamon, let's go to the speaker. [ inaudible question ] >> i'm not sure you're familiar -- i'm not familiar with what you're talking about, so i'm going to pass on that. we don't want the little sisters for the poor to be forced to buy cupboards that violates their conscience. if you're talking about that, then i'm in full support. casey? [ inaudible question ] >> don't know about the veracity of those reports, don't know about the content of the call or even -- i didn't hear about john mccain until what you just said. i know prime minister turnbull, he was in my office a few months
ago. he is a very important ally. australia is a very central ally, they are and will continue to be. i think it's important that presidents and prime ministers, heads of state are able to have candid and private conversations with one another. a twofer. [ inaudible question ] >> oh, did he? did he do the accent or the -- say that again? >> arnold schwarzenegger tweeted to the president that perhaps they should switch spots, the president to "the apprentice" it. >> i'm not going to comment on this stuff. let's talk policy. let me go in the back. [ inaudible question ] >> yeah, the model's the plan that we ran on last year. you can go to better.gop and look at. we think that you want a vibrant individual market, a vibrant
employer market. we want medicaid to work so that the states can innovate and so that doctors actually take medicaid patients. we want medicare to be solvent. we want medicare to be something you can depend on and know that it's going to be there when you retire. so what we mean is choices. we don't want one choice. that's not a choice. we want to have more insurers and providers in the marketplace competing against each other for our businesses, consumers and patients. we want patients and their doctors being the driving force and the nucleus of the health care system, instead of some government regulator telling you what you have to buy, where you have to buy it. we don't want just one insurer. we want a lot of insurers competing for our business. that's what i mean when i say choice. the whole point of this is it's the cornerstone of the free enterprise system in america. the more choices you have, the more competition there is, consumers benefit from that, and that is obviously true in health care, and it is one of the big reasons why obamacare is collapsing. look, as you heard me say how
few choices and options there are because of obamacare. it is not coincidental, then, that we have double-digit premium increases every year, that the deductibles for obamacare exchange plans are three times as high as the deductibles for people in the large-group insurance market that they get the health care from their jobs. so, clearly, this law isn't working. it is collapsing. and yes, this is what we call a death spiral. you're not getting the kind of pooling that needs to be allowed with choice and competition to get rates down, so we had to step in and replace this law before it gets too late, before people lose what they already -- their insurance. [ inaudible question ] >> the words you're talking about. right. [ inaudible question ] >> no, i'd say there's just a miscommunication or a misinterpretation of what we're trying to say.
our job is to repair the american health care system and rescue it from the collapse that it's in, and the best way to repair a health care system is to repeal and replace obamacare. it's not an either/or. if you want to repair the american health care system, you've got to repeal the law that is destroying it and replace it with a system that's much better. yeah. thanks for -- i know most of you, but thank you for saying who you are. [ inaudible question ] >> -- sexual identity or sexual orientation? >> no, i voted for that in 2004 or something like that? i can't remember when that bill was. so, no, i just don't believe in discrimination in the workplace, period. but back to your health care point -- what was your health care question? timeline, yeah. so, i'll defer to the chairman
when he wants to have his mark-ups, but we want to be moving our obamacare legislation by the end of the first quarter. yeah. >>. [ inaudible ] for employee-sponsored plans? >> there's no secret. i had a bill when we were debating obamacare that did that. so, my position is very clear. where congress goes on this is an open question. that's one of the ways you can finance tax credits. there are a lot of other ways of financing tax credits as well. [ inaudible question ] >> i'm wondering if you're totally comfortable with the executive orders and divisions -- >> yeah, sure. that's a good question, because you know this is not a muslim ban. if it were, i would be against it. we are a tolerant, pluralistic country. we are and we will be. it's really important. the bill we passed last year, if you recall, after the paris
shooting, it became clear to us that one of the terrorists infiltrated the refugee population coming from syria, so we wanted to make sure that that didn't happen here in this country. that's just sort of like national security 101. and then when we inquired among our professionals at homeland security and the fbi, can you properly vet these people to make sure that this doesn't happen in america, they said, no, we can't. and so, that's why we passed legislation with 289 votes, big bipartisan bill, saying let's pause this program until we can figure out how to get it right. that's effectively what this is about. so, to your point about religious persecution, presidents always and often put preferences in refugee populations. i think president obama had one for sexual orientation. they didn't call that a sexual orientation test. he put a preference in for sexual orientation. religious minorities are being persecuted. there's nothing wrong with preferring religious minorities from persecution.
yazidis are being persecuted. sunnis are being persecuted. christians are being persecuted. so there's nothing wrong with saying we're going to take into account minority religious persecution with this. jed. >> what about -- the question on australia, had a question here about the executive order -- what about the perception? do you have concerns? >> no, of course i do. of course i do. [ inaudible question ] >> well, like i said, i didn't read the transcript, so i can't speak to the president's -- >> even if that's not true, there's perception -- >> but i do think that there is a perception issue, and i think this loose rhetoric that suggests that this is a religious test or a muslim ban is wrong because it further that perception because this is not that. so i do think it's important for people to pause and look at the actual context of this. look at the press conference that secretary kelly had oopsion to put this in proper perspective so that it is not
misinterpreted as to being something it is not. [ inaudible question ] >> i said this on tuesday. i think the rollout could have been done a lot better. look, green cardholders. i mean, nobody wanted green cardholders to get caught up in this. so i think, yes, the rollout could have been done much better. i think we all know that. but going forward, let's make sure that we're not saying this is something that it's not so that we further misperceptions. tell me who you are. [ inaudible question ] >> rex tillerson's confirmation. are you concerned -- [ inaudible ] >> well, my position on things is pretty clear. i think rex tillerson's going to be a great secretary of state. i think people who don't know him or haven't followed him closely, will be pleasantly surprised. this is a very, very capable man and i think he's a good model for secretary of state. i don't know what their policy
will be for russia. i'm a russia hawk. i think sanctions should have been done a while ago. sherman. [ inaudible question ] >> oh, you're talking about the executive order? yeah, i obviously think that they could have done a better job on the rollout of the executive order. i think that they -- they don't even have a full cabinet in place yet, so i think it's pretty important to get the cabinet up and running so these interagency reviews can be done well. and i think going forward, they're going to do a better job of these things. yeah. [ inaudible question ] >> from the president directly about -- and australia. is it problematic -- [ inaudible question ] >> no, i don't think australia should be worried about its
relationship with our new president or the country, for that matter. i know your country well. i've met with your leaders continuously over the last number of years. so no, australia is an important, essential ally and it's going to continue to be. you haven't been to many press conferences. i typically don't quote or comment on the tweet of the hour. >> last question. >> laura. no, laura, "wall street journal." sorry. [ inaudible question ] >> i would be in favor of additional sanctions on iran. i think i'd like to put as much toothpaste back in the tube as possible. i think the last administration appeased iran far too much. i think they went too far with iran, and i think as a result, iran is far more active than it otherwise would be. iran, don't forget, is the largest, greatest sponsor of terrorism in the world, the biggest state sponsor of terrorism in the world. iran writes on their missiles "death to america, death to israel" and then tests them.
so this is not a friendly country that has global peace or national security interests in their mind. so yeah, i think we need to have it tough on iran policy. [ inaudible question ] >> i think we should stop appeasing iran. >> that is speaker ryan weighing in on several different fronts, this phone call between the president and the australian prime minister, the aca, the difference between whether you call something a repeal or a repair, the immigration order, of course, saying it is not a muslim ban and that if it had been, he would be against it. eamon javers, as he spoke, reuters out with some headlines from the president, saying he has serious concerns about nafta but says he's indifferent to whether it is changed or renegotiated entirely. we assume we'll get more clarity on that once this meeting with harley begins. >> reporter: yeah, that's right, carl. so, what's going on, we're having a bit of a news bonanza today. up on capitol hill you saw paul ryan speaking. we were listening to those comments. as that was happening, the pool
of reporters was brought in to a meeting that the president's having right now here at the white house with congressional leaders. they're expected to be talking about taxes and trade. the president has made some comments to those pool cameras. i'm seeing the pool reporter right now, in which he says maybe we should do a new nafta. he says i have very serious concerns about nafta. and the prison hesident has appy said maybe put an extra "f" in nafta, for free and fair trade, because right now trade is unfair. he says i don't care if it's a renovated or new nafta, and talks about wilbur ross, in the meeting with him today, saying he is one of the greats and will be fair to the country. so the president and top staff talking to congressional leaders about trade right now. we are expecting to see the president also meeting with harley-davidson executives. he's now expected to greet them on the south lawn of the white house as they come in for that meeting, and that's a meeting that has a lot of bearing on tariffs as well. of course, there's a long history of harley-davidson as a
company and tariffs in terms of foreign competition for u.s. motorcycle manufacturers, so you can expect there will be some more on trade here at the white house today, carl. >> all right. of course, this all sets up tomorrow, eamon, where we get the likes of steve schwartzman, jamie dimon, mary barra. that's a truly impressive list, if we can go on what's been reported in terms of invitees. >> reporter: we can, and cnbc has been confirming a lot of those names and we have a lot of those pinned down already. elon musk will be here. by my count, carl, that will be the fifth time that elon musk has met with the president since the election. so there's a ceo who views a very close relationship with this president as important to himself and to his company, and you can imagine why. i mean, tesla is a company that has benefited from government programs and access in the past. presumably, musk doesn't want to lose that and also wants to be a voice in this administration. but i've talked to some of the ceos who have walked up and down the driveway here on the white house north lawn as they go in to meet. some of them have a clear sense
of what they want to do and say here, and some simply tell you, look, i am here because i'm a good america and when the president calls you to come for a meeting, you come for the meeting. >> or in kevin plank from under armour's case, who says he's a good american, you might also live down the street from the white house. >> it's easy. it's good for you. >> i wonder if the priority for a lot of the executives coming to the white house tomorrow will be tax reform. we did get paul ryan earlier today in some tv appearances saying that the rollback and replacement of the affordable care act is priority number one, he'll do that by the end of the first quarter, but tax reform will be tackled in the spring. so now a lot of these executives have a couple months to actually have a seat at the table and tell the president what's important to them. what do you think they'll say? >> well, look, i've been asking the white house this morning for a specific agenda, what exactly does the president expect to get out of this meeting tomorrow? they're not offering that up and they're not confirming the list of ceos that will be here, but you can imagine they will have
the opportunity to say whatever they want to the president. and at some point here, we're going to get to a tipping point, right? because the initial meetings with ceos here at the white house over the first week of the trump administration were really sort of introductory sessions, get to know you sessions. you saw the president going around the room asking each ceo to identify himself and say a little bit about why he was there. in this case, you might imagine they might get to some more contentious issues, particularly on immigration, which is vital for some of these companies, and a lot of the companies have expressed real dissent with the white house in what it did last weekend. so, how will the meetings go that are more specific and not as general, and really express some dissent with the administration. how will the president respond to that? all of that is sort of part of the anticipation here as we go ahead into tomorrow. >> yeah. initial niceties might be over and the sleeves are rolling up. here's the president. >> good to see you. good to see you. >> mr. trump. >> good to see you. >> got it right the first time.
>> good to see you. >> hi, there. how are you? >> nice to see you again. >> nice to see you again. >> okay. >> hello, everybody. >> mr. president. >> nice to see you all. thank you. good to see you. we're going to start getting our trade in order. i know you like that. good. >> going to be one thing we'll really get along on, right? >> yes, sir. >> i think. so thank you all for being here today. great honor. we have put together an all-star team of top-level people working on trade. we are working very, very hard and will be very soon as soon as we get the go ahead. we'll have the 90-day period we have to think about. but we want to get that whole
thing kick-started and going. we have some statutory limits. we don't want to have those statutory limits. it's very important. i have very serious concerns about nafta. nafta has been a catastrophe for our country, our workers and jobs and our country, leaving our country. i want to change it. and maybe we do it. maybe we do a new nafta and we put an extra f in the term nafta. you know what the f is for, right? >> yeah. >> free and fair trade. not just free trade. free and fair trade. because it's very unfair. so all of the statutory guidelines we are adhering to. i would like to speed it up, if possible. you're the folks that can do it. it's so important. and we will make great trade deals and we will have something that will -- i don't care if it's a renovation of nafta or a brand-new nafta. but we do have to make it fair. and it's very unfair to the
american worker and very, very unfair to companies that do business in this country. that's why they're leaving. one of the many reasons. really, the taxes are too high and we're going to take care of that also. you all know wilbur ross, who is one of the great people of wall street, and he's going to be representing us in negotiations, along with his -- a lot of other great people. so we have really assembled tremendous talent. some of the best in the world. carl icahn called and said i can't believe you got wilbur. wilbur is known as "wilbur" and one of the greats. and he's fair. and he's fair to other countries. he will be fair to other countries. and i think we're going to have a whole new -- a whole new picture by the time we're finished. i just want to thank you for being here. we're starting the process and i think it's going to be a tremendous thing for our country, for the workers and for our countries that employ the workers. and thank you all for being
here. okay? [ inaudible question ] that is the president surrounded by obviously you heard him say, wilbur ross, one of the great people of wall street, who will be point man on any nafta renegotiation, which the president hopes to do sooner rather than later, apparently. also in the room, steve bannon, jared kushner and so on. eamon javers, what did we learn just now? >> carl, what we learned is the president is convening this top session, and you look around the room to see who is there. because so much of the negotiation depends on who actually has access to the president. we are told, it's hard to tell, the side facing us in that shot was the side where the congressional leaders are. we were told that senator orrin hatch and senator ron wyden of the finance committee in the senate were supposed to be there and also congressman kevin brady and congressman richard neil in the house ways and means committee in the house of representatives. those are the tax committees who
were there in that meeting. and what happens after they escort the press out and you get the introductory marks is they get down to some actual business. the fact that democrats were expected to be in the room, as well, you can expect that there might be some early table setting here in terms of trade and tax policy. so that's what we can expect. we'll try to do some reporting when they come out and figure out if they got anything done here, at least initially, guys. >> this tape has -- displaced the regular santelli exchange. we want to get rick's temperature after what we just heard? >> i'll tell you, carl, whether it's about policies that are pro business, like lowering corporate taxes, whether it's about trade and changing trade agreements, the market and investors continue to be more or less half full versus half empty. but it is very difficult. think of the three words we're talking about here. status quo, change and uncertainty. with regard to status quo, whether it's on generic issues,
the country is pretty evenly split, which means half like status quo. change means you're going to alter status quo. it's not going to be easy. and change could go in either direction. but when it comes to certain issues, as uncomfortable and uncertain as change may be, things need to get done. and an adage of keeping things the same that are running at a c minus at best, and trying to improve them is still going to break a few eggs to make a better tasting omelette. and the last point, and i think this is a biggy, and more than semantics. uncertainty has a common denominator with logic, as well. many things were necessarily business-friendly. yes, they're uncertain but more pro business. and i think that has to be weighed, and i think the market is weighing that. and i think it's a continued underlay meant of much of the activity we have seen since the election. >> rick, any concerns about the fact that our relationships with
neighbors, like mexico, certainly, canada and then our frequent partner, australia, put into question during all of this change? >> absolutely. absolutely. and i think that that's where many of the tensions lie. but at the end of the day, this president has said time and time again, he's going to do what he thinks is in the best interest of america, being an american president, and we'll have to see where that takes us. >> rick, thank you for that. rick santelli and eamon javers in washington. dow is down 34 in all of this. back in just a minute. alal.its)? vae pitah,t thama alal.its)?
we are awaiting executives from harley davidson, the iconic american motorcycle company to arrive at the white house. ceo matthew will he vattich and other leaders meeting with the president and members of his staff. that's expected to take place at noon eastern. it was originally scheduled for 1:00. shares of harley were down earlier in the week after softer than expected earnings. but it will be interesting to see what comes out of this meeting. >> stocks up 44% in 12 months versus s&p 19. interesting, i thought. last night, company tweets hash tag united we roll. and says america has never faced a problem americans couldn't fix
by looking each other in the eye, shaking hands and firmly resolving to hammer out a solid solution. we'll see if that's the tune they take today. >> that's optimistic. we have also got amazon earnings after the bell, which we will be watching after facebook did well and apple, as well the day before. >> what a week for tech. let's get over to the half. back at hq. ♪ guys, thanks so much. welcome to "halftime report" i'm scott wapner. we begin with the markets and whether the trump rally is at risk from rising global tensions to uncertainty over the fed's next move. a lot for investors to consider today. with us for the hour, joe terranova, jim labor en that will. also, paul richards, the president of medley global advisers. so doc, you tell me. i'm just wondering if investors are complacent, too much so, to some of the risks that seem to be out there.