tv Squawk Alley CNBC March 23, 2017 11:00am-12:01pm EDT
unit. reuters reported on friday that the bank's board of directors was set to decide in april whether to go ahead with this ipo. we have reached out to credit suisse for a comment. we have not yet heard back, but we will tell you when we do. the stock is about 1% higher year to date. now it's time to send it over to the crew at "squawk alley." over to you guys. >> all right, dom. thank you very much. it is 8:00 a.m. at alphabet headquarters out west, 11:00 a.m. on wall street, and "squawk alley" is live. ♪ ♪ good thursday morning. welcome to "squawk alley." i'm carl quintanilla with jon
fortt, seema mody joins us this morning at post 9. we begin the hour with some breaking news out of disney. the company saying the board of directors has extended bob iger's contract as chairman and ceo to july 2nd of 2019. orrin smith is the independent lead director. he says given bob iger's outstanding leadership, his record of success in a changing media landscape, and his clear strategic vision for disney's future, it is obvious that the companies and its shareholders will be best served by his continued leadership. i think returning to julia boorstin on some of this as we make sense on what iger's going to be around for a while, julia. >> that's right. there's been a lot of talk and speculation about who was going to replace bob iger when his contract expired at the end of june 2018. and so, the fact that this is being extended for a year is not a big surprise because there was no obvious successor for iger. there is also the fact that disney has done phenomenally well under his leadership. now, in the past couple of times
i've sat down and interviewed bob iger, he's talked about how much he's enjoyed running disney and about how there is so much potential ahead. just a couple weeks ago in the company's shareholder meeting, he dropped some hints that this news would be coming. he said he sees massive potential for disney ahead for all of its different divisions, and sort of indicated that he's started certain things, such as the park in shanghai, such as doing more digital initiatives with espn and with the media networks, that he would like to see out. so, this is not a big surprise. but certainly, reassurance for investors who wanted to understand who would be leading disney into this next chapter. the press release here cites that under iger's tenure, there's been a total shareholder return of 448%, compared to 144% for the s&p 500. the dramatic increase in the company's market capitalization to $177 billion from $46 billion. so, clearly, iger has transformed the company, some massive acquisitions, such as
lucasfilm, which has enabled the company to do this "star wars" franchise, also acquiring marvel. so, iger's transformed the company, and now he has another year beyond his past contract through june 2019 to take the company into the digital future. guys? >> julia, thank you very much for that. 66 years old, has been ceo for 11 years. of course, as julia just mentioned, vastly outperforming the s&p under his tenure. as for iger himself, he says "leading this company has been a tremendous privilege. i'm honored to have been asked to continue serving. i'm confident disney's best days are still ahead." >> and this, of course, follows widespread speculation of facebook's sheryl sandberg potentially having some level of leadevership at walt disney. you've got to wonder what this means for her and her position at some point at this media company. >> yeah, i don't know that that was ever taken that seriously, but looking at bob iger's legacy, i think it's easy to
forget, when he came on board, the whole pixar relationship was in question. his relationship with steve jobs sort of paved the way for pixar to become a part of disney. that brought john lasiter in to basically fix disney animation, which was in shambles. it's hard to remember the time before "frozen," when that was a mess, plus, pixar and lucasfilm, as mentioned. and then over the past week, we've seen "beauty and the beast" start this new era of live-action remakes of disney classics. it really has been phenomenal. mike santoli, wondering your thoughts on the impact for the stock going forward? >> yeah, jon, obviously, it's going to be considered welcome relief. i don't think there was really a pins and needles sense about this. it was kind of something that could go either way. he could be extended, or maybe they would do a full on search. i do think one of the reasons there's relief is because the lack of an obvious successor, somebody who really seemed to have the heft and the vision that iger has shown here was probably going to become more an
issue the closer you got to the end point of his contract. so, i think this is a company right now, as it approaches wall street and its overall strategy, that is all about kind of transparency about the next few years and those franchises. you mentioned, jon, the remakes of the animated movies as live action, all of the individual franchises that iger has purchased, whether it be, pixar the least of them, but obviously, lucas and marv yelling with the "star wars" and the economcomic book franchises. they have multiyear slates of releases. but espn and the cable bundle has not been so much, but i think there is probably some comfort that iger will be the guy there trying to figure out, midwifing this transition to kind of whatever comes next and experimenting with other models there. >> julia, we might expect then over the next few months, i would imagine, we'll see, the degree to which iger can afford to make some longer-term bets as they try to mitigate the bleed from subs at espn and cable in general. but i wonder if you think the
question of board -- the question of benchmark strength in the c suite remains, because after stags, this was a question that people wonder whether they were left with anyone else. >> oh, yeah, carl, there's no doubt that basically this does nothing to kind of refill the ranks. it just kind of puts off when that becomes a critical problem. >> julia? >> but i think to your point, carl, that we have seen iger start to make some of these long-term bets, such as buying a big stake of bamtech, which is a streaming video technology company. disney has the opportunity to buy the rest of that company and to use that technology to create more direct-to-consumer apps, you know, taking disney content and turning it into subscription service, bringing espn direct to consumer in more ways. we already are anticipating an espn streaming service coming later this year that's not going to have the core television content as part of that. but we are starting to see iger make longer bets, and i think there is the question about giving some of the executives at disney now more time to mature and potentially become
successors to iger. tom stags was coo, the heir apparent, and he was pushed out. he was pushed out in part, perhaps we're seeing now, maybe iger thought he wanted to stay longer. it was said that he just didn't have the content chops to lead this media giant. but i think now the question is who are the people running different divisions who could be trained in the next couple of years to be successors to iger, or will we see in 2019 sheryl sandberg or someone who's an outsider be brought in to replace iger? he certainly has very, very big shoes to fill and there is not an obvious successor yet at the company. so, right now the big question is whether someone will be trained and put into that coo role that tom stags had when he was considered the heir apparent. >> yeah, julia, i watched your interviews with sheryl sandburg in the past. what do you think this means for her role at disney long term? >> i think she was always considered the outsider long-shot. she is a member of disney's
board, and so she serves as a member of disney's board. i think when people were trying to figure out who's going to be the next ceo of disney after iger, people started to really look outside the company because there were no obvious successors there, and that's why someone line sheryl sandberg, who has very different area of expertise than iger did, was mentioned as a possibility. but i think for now, the question is with iger leaving in 2019 if there will be more time for the bench at disney to mature to be able to take on those roles. i mean, this is a company that traditionally hires people, you know, promotes people who have been there for a very, very long time. it would be unusual for them to hire outside. sheryl sandberg's hands are very full right now, being coo of facebook. >> julia, if i had to pick something to be a knock on bob iger's tenure, it'd be tough, but i think it would be in tech. you mentioned the bamtech acquisition. maker studios was another that from where i sit looking at tech
just really hasn't blown the doors off for disney. what would you expect to see from the next couple of years of iger's tenure in the technology space? they've used it certainly to great effect for marketing, but in terms of building up their own technology. properties, they haven't done much. >> i think you're right. i think maker studios was a disappointment. $500 million to buy these msns. these are multichannel networks, which is basically different groups of youtube content creators. now, it didn't turn out to be the massive hit that disney's other acquisitions have been, and it was a move in a different direction. we'll see what the long-term value is there. but in terms of technology, i think it's going to be buying the rest of bamtech and creating more direct-to-consumer options. disney is an unusual media company in that it has the name recognition and the brand recognition that it can sell its content direct to consumers in a way that other media giants may not have the opportunity to.
the prime example that everyone's watching here is disney life. it's a product, a subscription service that is sold in the uk that's selling disney content, disney movies. so, a lot of analysts say that a lot of families in the u.s. would happily pay a monthly fee to have access to disney content. >> yeah. so, now the race is on to see whether disney's move into tech can be faster than some tech companies' move into content, recalling that old -- wasn't it they went that a way and that a way. isn't that an old disney picture? julia, thank you, guys. we'll watch that as the morning goes on. the showdown in d.c. over health care and uncertainty over the trump agenda casts a bit of a shadow on the markets. the dow was eyeing six straight days of losses, but now up 55. here to break it down, doug cody's chief market strategist, samantha mazarello strategist with jpmorgan funds. good to see you. we don't know what's going to happen tonight, so as the market tries to look through the house
vote, what is the trend in your view for equities? >> firstly, i'm positioned for the growth in reflation traidz tra trade and the fundamentals look strong. i'm seeing all good. i'm seeing accelerating corporate profits, broadening manufacturing, not just in the u.s., but around the world. the consumer -- i call the consumer the game-changer. and what i'm looking for, what i really want is tax cuts. and by the way, i don't think it's really being telegraphed. this aca restructure is really the first shot across the bow for tax cuts, and that's very important. so, that's why this has to go well. but you have a president who, if he doesn't get it tonight, he's going to get it tomorrow or the next day. he doesn't have another path. this is the new path -- pro growth, pro jobs -- and this is the down payment. >> samantha, from an investor perspective, this health care vote is seen as a test of
president trump's legislative ability and to see if he can actually get tax reform on the table. if it doesn't pass the house tonight, does tax reform become a 2017 story? >> i think they're separate issues, right? and it's easy to link the two and say if one doesn't happen, it will make washington seem inept to the markets. it's too early to kind of market that way. yes, it has implications for the health care sector and health care stocks, but you zoom back out, the broader narrative is global growth is picking up, and the world is becoming in sync again in terms of business cycle uptick, so that bodes well for equities across the board. then you can get a bit more nitty gritty, whether you want to believe more in u.s. equities over international. we have a little bit of a bias to international and emerging market, so maybe there's a little caution from headline risk affecting u.s. equities. >> doug, when it comes to u.s. equities, what do you think is baked in as far as the likely outcomes here with health care? i mean, if we don't get a vote tonight that goes in the direction that the republicans certainly expect, is that a negative for the market, or have we been sort of treading water
slightly down for the past five, six days because we expect uncertainty around how long this is going to take? >> no, i think the health care vote is important, but i don't think it's critical. what i'm looking at is critical is first-quarter earnings reports, and i'm looking at -- i'm seeing a 9% earnings growth for the first quarter. we haven't seen that since 2011, and that's a testament on the global economy because half the revenue is from overseas. so, i'm saying the market should be looking past this. i'm not saying we're going to get hurt. i don't think so. >> we'll hear about that in the next few weeks. really appreciate it. when we come back, we are awaiting that vote on health reform. we'll talk to house ways and means committee chairman kevin brady, making that last push in favor of the bill. he's going to talk to rick. we'll get more on disney, bob iger extending.
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house speaker paulry ryan delaying his press briefing until this afternoon. he's meeting with freedom caucus members this hour ahead of tonight's vote on health care reform. let's get to the cme, rick santelli and a special guest, rick. >> i'll tell you what, this is a big day for me, but it is certainly a huge day for this gentleman, who happens to be chairman of the house ways and means committee, texas congressman kevin brady. chairman, thank you so much for taking the time today. >> thanks, rick.
>> listen, today it's all about timing, really in many ways, the first big test of having both houses under the arc for republican with a republican president. how might the timing be changed considering last-minute negotiating regarding the big vote. >> yeah, it is a big day, as you say, and i think that's what contributes to this. look, a lot of the timing for this vote depends on the meetings that are occurring today. the president with the freedom caucus members, leadership, those of us putting this bill together with other members in the conference working toward a solution. as you know, look, i think there's 95% agreement on this bill, but in washington, that last 5% really matters, especially if you're ripping up a huge entitlement, making huge replacement decisions going forward, just going to be this way. so, i'm really hopeful we get this day, we get to that point
where we can move this out of the house. >> you know, i like taking a tour of the sausage factory, chairman. i don't find it at all ugly. i think it's a beautiful process. and to that end, one of the issues of the freedom caucus -- and i get this -- is less federal mandates on people's health care. and two that, one of the things being bartered right now, i would wager, are ehbs, essential health benefits. the federal government mandating what the baseline of all insurance policies need to be. i can understand why the freedom caucus doesn't like that. your thought. >> i agree. i trust the states to approve the plans that work best for the states. and even in states like texas, frankly, our communities are about five different states. so, there's going to be different plans with different emphasis in different parts just of our state alone. but look, i also think we have members who are concerned about sending that much power back to
the states, and so there is some resistance. i think at the end of the day, let's do all that we can to eliminate the federal mandates out of this. let those new, innovative, affordable plans take life back in the states. >> all right. now, listen, i've said this many times. i don't think it's a secret. trump in another era would be considered a moderate democrat. the freedom caucus is definitely conservative. i would say that them intermingling may have an effect on the bill that will make it the most conservative it will ever be, if it passes, because then it goes to the senate. why don't you tell me about that process, chairman. >> yeah, so, as you know, we are playing by the senate rules, one, because we're trying to get over that 60-vote filibuster through a simple majority. secondly, we have to abide by the senate rules. so, the house has some guard rails. frankly, we'd prefer we didn't have, so we're going to send the most free-market, most local control reform bill to the
senate. we are hopeful that they can do their magic with their own rules and continue to make it better. and so, i don't think this is over yet, and i think, frankly, moving forward, it can get even better. >> you know, i'm a market guy. you know that. and i hate when things come down into the marketplace that i love as a binary scenario, meaning, if this passes, markets generally will like it. if it doesn't pass, markets generally won't, kind of like that first t.a.r.p. vote. so, i will ask you, are people expecting too much? when the media puts out, it's messy, people like puritiy. we live in a social age -- thumbs up, thumbs down. that's what people want to see. but it isn't pure. but can it get more pure if you make it over this hurdle? >> look, i think a lot of good things happen moving forward. one, as you said, it shows the unified republican government can act boldly and actually govern to get it done. secondly, for me, you know, my
love is tax reform, and so, passing this eliminates nearly $1 trillion of taxes. that makes our tax reform even more pro growth and more bold. and secondly, it creates the momentum that i think's hugely important to tax reform going forward. so, i think there's a lot at stake on the upside of getting this done sooner rather than later. >> give us some insight, chairman, into how president trump is dealing with the issues and trying to come up with, of all things, compromise. >> yeah. so, in every meeting he's been in that i've been in, he's been listening very carefully. he's really straight forward. look, we can do this, we can't do this. others we need to do in the senate. how do we get it to the senate? and so, he's -- look, he knows what's at stake here. he knows we just can't repeal and walk away. the market just shatters further. and so, look, i like what i'm
seeing out of the white house right now. and members, boy, i think they love to be engaged with him on this. >> excellent. okay, now, the time remaining, about 2 1/2 minutes, let's talk about taxes and tax reform. and the main issue i want to deal in is the back tax. quickly, there's a group out there that just say it's a tax. you're trying to cut taxes with a tax. and their idea is that if you separate the dollar value exports and imports, it's around let's say $500 billion. if you take the tax rate people are looking at on the corporate side of 20%, what's 20% of $500 billion? it's $100 billion, the exact amount that you're trying to raise in revenue through the back tax. is it more than just a tax? >> it is far more than a tax, and this is the heart of this. look, your viewers succeed because they know what their competitors are doing. so do we. we know what china, germany, canada, mexico are doing. they're beating us on rates. they're beating us on no longer taxing worldwide and border
adjustability. so, we're going straight at them in the world today, because this isn't the '80s where rates alone will do it. we have to go bolder than that. and the border adjustment tax has big benefits. one, it simplifies international tax code. it levels the playing field here in the u.s. between foreign products and u.s.-made products. it eliminates any tax incentive to move jobs in manufacturing overseas. in fact, just the opposite. it re-establishes us for that new business investment. and yes, it helps us lower that business rate dramatically. so, my thinking is, rather than take the b.a.t. out and we have the opposite of all that, why don't we modify the border adjustable provisions, phase them in slowly, make sure that we allay the valid concerns of those who are importing today. and i'm convinced we can do it. >> all right, now, my next question is, are there going to be any carveouts? and i don't know, pick a weird
example. we don't really -- we're not really known for growing bananas in the united states of america, okay? guatemala maybe. so, are there going to be carveouts where there are going to be certain things that are coming into the country that by taxing them, we're not going to do any good? we're going to raise prices, because the industry just isn't ready here. will there be carveouts? >> so, i hope not, rick, and here's why. look, that will be the new lobbyist dream for tax for the next 20 years is to get their product or service or components exempted from this. i would rather design this to address the raw commodities coming in, the components that move across, the finished products. and as you know, by the way, i love that example, because look, fruit, farm products, they fluctuate in prices dramatically. when bananas go up, what do we do? we buy georgia peaches and apples and california raisins. we substitute. i think at the end of the day,
we can design it to address issues just like that. >> now, my final comment. you know, when it comes to taxes in general, there's a lot of talk about static versus dynamic scoring. i guess what i'm worried about is that same thought process when it comes to what happens in other countries. so, we put a border adjustment tax. well, play ping pong. now the ball's on their side of the table. don't they just make an adjustment that would render this less important and maybe start issues with trade and pricing that we don't want to go down, a road we do not want to go down? >> yeah, great question, and the answer is, on the border adjustability, they already do it. 160 of our competitors already do this. their only argument can be don't copy us. but, of course, we have to to have a competitive tax system. what i do think they'll do is look at their own tax rates, which they've just been beating us like a drum on, and try to figure out can they go lower in that rate.
so, my point is, we're already in a tax war with our competitors. we're just losing. and so, to leapfrog back into that lead pack, we've got to go bold, we've got to go straight at this and recognize our competitors are always going to try to have a better business environment than us. our challenge is we've got to stay ahead of them. >> all right. my final, final question -- do you think the bill's going to pass, and will it be voted on this evening, sir? >> i don't know the timing. it depends upon how the meetings go today. but yeah, i do think at the end of the day it does pass, because look, we are so close and agree on so much of this. you can't tell me after seven years and all this work that we can't finish it out. >> chairman, you've been a very good sport. i like your very direct answers. please come back after the vote and let's discuss the outcome. >> it's a deal. >> thank you for being my guest today, sir. >> thank you, rick. >> thank you. seema, back to you. >> rick santelli, thank you. of course, this all coming ahead
of the crucial voet tonight, carl, and markets again seem to be concerned about whether this vote will pass. but again, the implications on not just the health care sector, but what this means for tax reform and deregulation, these two pro business policies that wall street has really been trying to run on. i mean, the stock market out 12% since the u.s. election, but if there's any delay, the impact that could have on stocks and bonds, that will, of course, be watched very closely. >> of course, brady making the key point that a big part of the health care reform bill involves taxes. our last guest called it a down payment on a broader tax reform schedule. and you can't ignore goldman now adding 25 points to the dow, which is close to session highs. not that the market is a great whip count, because often it's not, but there's little more optimism about passage at this moment. >> yeah, there is optimism about it, but it strikes me that what we're actually getting in the ahca keeps morphing, keeps moving. the latest news overnight that
the sort of minimum provisions in insurance would be shifting, according to what the freedom caucus wants. the republicans are going to have to actually sell this after they pass it, if they pass it. the negative scenario for them, i guess, is that they end up getting this through, and then their core voters don't like it. we don't know, because we actually don't know what this is going to end up looking like once it gets through, if it gets through, carl. >> and we still don't have an updated cbo forecast on the new amendments made to the bill, what that means for the number of insured. more on that health care bill coming up. and when we come back on "squawk alley," former medtronics ceo bill george on the business impact of tonight's crucial vote. and disney's ceo bob iger extending his tenure with the company. pulitzer prize-winning "the new york times" columnist jim stewart weighs in. "squawk alley" will be right back. ♪ ♪
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rise nearly 80 points as we await the timing of this health care vote potentially today. when we come back, we'll check in with pulitzer prize-winning "the new york times" columnist jim stewart on bob iger extending his contract at disney, in a moment. hey gary, what'd you got here? this bad boy is a mobile trading desk so that i can take my trading platform wherever i go. you know that thinkorswim seamlessly syncs across all your devices, right? oh, so my custom studies will go with me? anywhere you want to go! the market's hot! sync your platform on any device with thinkorswim. only at td ameritrade
belgium's prime minister charles michel informing parliament that authorities were closely following developments in antwerp, where a car drove high speed through a busy shopping street in a suspected attempted attempt. police arrested the driver. the senate banking committee holding a hearing on jay clayton to head the securities and exchange commission. he said the question of whether dodd/frank has been effective is on the minds of the trump administration. >> i do believe that dodd/frank should be looked at, in particular, rules that have been in place as to whether they are achieving their objectives effectively, but i have no specific plans for attacking a particular provision of dodd/frank, senator. a suffocation risk has prompted the recall of more than 10,000 packages of children's water-proof bibs. the recall involves environment brands bibs with water-proof plastic backing.
there have been 12 incidents of that plastic separating from the fabric. that's the "news update" this hour. back downtown to "squawk alley." carl, i'll send it back to you. >> sue, thank you very much. obviously, big news out of disney this hour, bob iger extending his contract until 2019. joining us this morning with his always unique insight, pulitzer pri prize-winning "the new york times" columnist jim stewart, author of "disney war." jim, good to see you. >> thanks, good to be with you. >> going to be hard to run for president if you're running disney. were you surprised? >> well, no. the fact that he extended is not a surprise. there's been a certain amount of kabuki sheeter about that. as soon as iger said he was, quote, willing to extend his contract, you know he wouldn't have said that if he hadn't gotten plenty of encouragement from the board, and he's very close to the board. but i will say, i am surprised that it was only a year. his contract was going until 2018 anyway. he gets one more year, to 2019? you know, for the last year, something like that, if this is a real exit time, that's, you
know, you're a lame duck. i was a little surprised it wasn't longer. this basically just slightly pushes the decision down the road. disney is still facing a pretty imminent deadline to come one a successor with no obvious heirs apparent inside. >> jim, i'm looking at the list of ceos of disney since walt disney -- roy disney, don tatum, card walker, rob miller, and of course, michael eisner. it seems to me like iger is perhaps the most significant ceo of this company since walt disney, based on the acquisitions he's done and the success of the movies and parks and marketing since then. give a sense of how important he is to the company and how smooth or difficult a transition out of his leadership eventually is likely to be. >> well, iger has done a tremendous job there. i don't think there's any disputing that. you know, by every measure, they've done -- he's just had some phenomenal accomplishments
under his belt. the acquisitions of marvel and pixar, which were widely under yided on wall street as too expensive, so much exceptism. they seem to have been home runs. the resurrection -- you know, the success with the movie division, the resurrection of disney animation, which was, you know, on life support when he came in, these are huge accomplishments, and i think he deserves a tremendous credit for that. whether he's the greatest ceo since walt disney, i think you have to give michael eisner credit in the early years. he also brought disney back from the brink of death, and that was also a very, very significant accomplishment. but there's no question that in recent years, iger has been kind of the model ceo. that said, you know, he's been there 10 or 11 years. disney does have a history of, particularly with isner, of ceos staying too long. and you know, it's not unique to disney. it seems to be the entertainment industry generally.
maybe these jobs are just too good to give up, but there are some new challenges arising. you know, the fade of the cable networks, which is the biggest contributor, not the most visible sometimes, but the biggest contributor to disney's earnings, very much a subject of concern for wall street. rapid technological change. there is a lot of thinking that you need a new generation, not just at disney, but pretty much all of the legacy entertainment companies. >> you know, jim, the success that disney has had in its box office, that, of course, has fueled earnings and its stock. it's up about 16% over the past one year, but there is still longer-term questions about the health of espn and sports. so, what else can iger do there? >> well, what could any human being do about the technological changes that have swept the cable industry? i mean, the move to the thin bundle, the skinny bundle, you're seeing it, already a lot of channels are going to get
squeezed off of cable. the old cable model, which was fantastic for espn, is eroding, it is dying. is there a path for espn to maintain the level of revenue growth and profitability that the old cable model developed? and i don't know anyone who has come up with an answer to that, that says, yes, it is, you know? recently, the profits have been down slightly after years of amazing growth there. that doesn't look like for the foreseeable future it can be a growth -- certainly, this problem cannot be solved in another year or two that iger is going to be there. that is going to be a big issue he'll have to hand off to a successor. the studio division has had amazing success. and this announcement kind of comes in the after glow of a huge opening for "beauty and the beast." who would have thought a live action "beauty and the beast"? it's already an animated film, already a broadway musical. now they have squeezed it into a monster hit.
well, good for them. allen horne, who runs the studio division, he's kind of getting up there, too. he's done a fabulous job. again, how do you do any better? the "star wars" franchise, they have executed brilliantly under iger. can you milk "star wars" forever at that rate? i mean, it's a fantastic property, and i give them tremendous credit, but i don't know if that's humanly possible. so, maybe iger is smart not to stay too long. another year, he'll still be, you know, leaving with a glow of tremendous run around him. >> right. i was joking about the run for president, jim, but i wonder, july '19. i mean, if your interest is maybe in more local or statewide politics, maybe it is a natural time to step out. >> yeah, well, that struck me, too. i recently wrote about, like ceos who suddenly think they are viable contenders for the presidency, given that trump is in the white house. and iger has been frequently mentioned and talked about as a candidate for political office. it seems to be something he's
interested in. we know he's had conversations with former new york city mayor mike bloomberg about mounting and financing some kind of a bid. in the summer of 2019, it would give him a number of options. i think it's a little late for president, but that might have been a stretch anyway. >> jim, it's good to get your take on it. obviously, market paying attention this morning. we'll see you soon. >> right, thank you. >> jim stewart of the "the new york times." >> and also joining us now on the phone is walter isaacson, president and ceo of the aspen institute. good morning, walter. a lot to talk about this morning. we've got this news about disney's ceo, bob iger, extending his stay there as ceo. we've got the health care vote on capitol hill later today, and then we've got news of advertisers, at&t, j&j among them, pulling ads from google's youtube because they're concerned about the type of content they're being displayed beside. so, my question is around content. you can say anything about bob
iger, it's that he is invehas i in premium content at that company. that seems to be also what the youtube thing is about. what's your thought about where we are in the content business, what this signals for us? >> well, i think the bob iger news is both very welcomed, and in the day and weeks of totally surprising news, it's probably the least surprising news and most expected news you can have, because of course disney would want to extend him, and i can see why bob, who really loves what he's doing, would be able to do it. as you say, he's been about premium content. he bought pixar, he bought marvel, he bought lucasfilm. and remember michael eisner, who was the outgoing ceo or just left thought the pixar animation studio acquisition was insane because of the price. even went to the board and said so. bob iger turned out to be right. in this day when you're going to be -- in these days where you're going to be unbundling the cable model, as jim stewart said,
that's the biggest, biggest challenge disney faces, you want at your helm somebody like bob iger who knows that in the end, having the premium content is what protects you in a world where people can go anywhere and get anything. and certainly, when youtube is putting on content that's destructive and denigrating, and now people are fleeing it, you protect your brand of disney, which is one of the great brands of the century, and you protect your business model if you're somebody like bob iger who understands good and premium content. >> is two years long enough to see this content versus technology thing really more come to a head? you mentioned the sort of unbundling of content. netflix has its model. we see technology companies like apple and amazon trying to move more into the content space. or are we going to see bob iger kind of play his fuller hand in that environment?
>> i think the big thing bob iger can do is say what do you go to when you're in a post cable bundle model. what abc and disney have done is, unlike say the network we're talking on right now, decided at abc disney not to own the pipes, not to own the distribution. this can give you more flexibility. the question is what do you do with that flexibility? how do you invent new ways of going direct to the consumer? that's going to be bob's big challenge, not only doing it himself, but finding a successor who's going to bring us through that next generation of on demand, anywhere you want content, but i think he'll lay the foundation for that by having things like marvel entertainment and all the things disney produces, including espn, which people really, really, really want to see. >> walter, if we look at bob iger's bigger initiative, which has been taking disney overseas,
specifically in china, which i was just looking at box office sales. if you look at "beauty and the beast," sales in china, that was its single biggest contributor to foreign ticket sales, but now there are also questions about this uncertainty around the future of relations between the u.s. and china. do you think that will impact disney's growth in this big market? >> i think disney is probably less susceptible to having problems, except for as an intellectual property trade war and china goes back to being able to rip off intellectual property with impunity. i know -- i saw bob iger when he was in town a week or two ago for the opening of "beauty and the beast" on broadway. i mean, who would have -- i mean, this is a pretty good brand, disney, but who would have thunk that you could have a brand like "beauty and the beast" that would become a global brand from broadway to beijing? so, i think the thing about disney and about bob iger is that he's covered his bets, he's
hedged his bets. if espn has a bad quarter, the studio still does well. if china has a bad period, broadway does well. but i don't think he's as susceptible to problems with china as other trade partners would be. >> all right, walter isaacson. >> i do think it's interesting, you did ask about, you know, him running for president or things like that. we'd be very lucky to have the type of business leader that bob iger is on the national scene some day i me. i mean, i don't think donald trump has shown how do you really run an enterprise. bob iger has shown how you run an enterprise. >> but trump certainly has us talking about ceo presidents, whether howard schultz or bob iger. walter isaacson. [ everyone talking at once ] >> thank you. >> yes, thank you. >> thanks, walter. when we come back, the crucial health care vote on the hill. we'll check in with former medtronics ceo bill george, who has always some good insight.
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scott wapner. today's dramatic health care vote will end the trump rally or send it to new heights? plus, you won't believe what analyst thinks shares of american airlines could head. big news on disney and ford. big stocks on the move today. we'll debate them, as well. "halftime report's" top of the hour. we'll see you in about ten
minutes. >> thanks, scott. president trump meanwhile lobbying house comforts at the white house on the gop's plan for health reform. unpacking the market impact of that bill and more, bill george, harvard business school, senior fellow and medtronic's ceo, and cheryl skolnick, senior health care analyst. welcome to both of you. cheryl, you point out the likely impact on the hospitals of all this. whether it gets through the house tonight or not. what do you see as the impact on the hospitals up to this point, and what happens, say, if this gets delayed a little bit? >> sure. so first, thank you for having me. you know what's really interesting about these stocks, they're actually higher than they were the night of the election on november 8th. and that was actually not what i expected. so, you know, analysts who haven't been wrong, haven't been on the street long enough. i had been on the street long enough to be wrong. i think what's happened is the
enthusiasm for, a., the aca not happening, and b., tax reform happening has carried these stocks up to their recent highs. and now we have seen them back off, and there is news and there is noise. we have got a lot of noise now. we'll get news when we get a vote. and you're seeing the reaction today of that. but if this bill is passed out of the house, i still think that it will be negative for these stocks. i think that the general consensus is not that it actually passes. i think the consensus is that it fails. and as a result, if it does get past the house, there will be, i think, some moderated downside. all eyes will turn on the much more moderate senate and the games we will have to play, and the machine naigss to get it through the much more moderate senate from the house. >> it's strange, because i want to get to bill in a second. but overall markets up, which some take to mean they think passage is more likely. but the hospitals are up, which
some believe it's less likely. what's the tell today, is the question? >> again, so i think the hospital investors and i don't think there's generalists investing in hospitals these days. i think those who own it are specialists. and they're trying to read the tea leaves of the commentary that's coming out of the house. so, for example, you had chairman brady just talking about it. he didn't say definitely we've got to vote tonight. so what that's going to tell a seasoned health care investor is they don't have the votes. because otherwise they would know what time they're voting. so that could be why -- that's why i say there is noise rather than news. but what i see is this is all part of the normal extraordinarily messy process of getting legislation that is this fundamentally change-making through a house that is not united. and has very different objectives, depending upon where even within the republican party the member sits. >> one of the essential
features, bill, of this health care bill is the eradication of the individual mandate. which sector of health care do you think will be most vulnerable to this change? >> well, i think -- go ahead. >> bill, i'm sorry. bill, go ahead. >> i think we're seeing a massive wealth transfer with this from the poor and the middle class to the wealthy, to wealthy pharmaceutical companies, and i think it could be a disaster in the making. as we go through this, i think hospitals are going to be very vulnerable, because people are not going to have health care. the 14 million are going to lose their insurance could be a lot more than that. because insurance rates are going to escalate rapidly. now, as the pools without the individual mandate, the pools are going to be filled with people that are older and sicker. and that means higher rates and insurance companies have to charge those higher rates. and so i think you have a real problem here. the hospitals are going to be flooded with people in the emergency room so they get free
care. and this is not good. and they'll come in late-stage and get that tumor, you my weight a year-and-a-half and then it's advanced, metastasized and costs a lot more. there is nothing in this bill that deals with improving the health of americans with our lifestyles, with the quality of outcomes. and so i think the bill will get done on the house side, i think it has to get done. it's moving the wrong way, farther to the right, taking away the various mandates. i think all that means is that people will find out, wake up one day, find out they have a certain illness and they're not covered. we had an example in minnesota. today. from the kaiser family foundation. someone earning $30,000, 60 years old, their insurance rates go from $2.500 to 18.9. if somebody who is 27 years old has insurance rates and earning $75,000, their rates are going down $2.500. so you have this shift and i think it's wrong. >> bill, whether the american people are going to get a good
sense of the impact of this bill, you think. you seem to think it's going to be negative. >> yeah, i think it will be negative. i don't think they'll have it for some time, and the people, john, getting hurt are the trump voters. the people that voted for trump. it's not the wealthy people, they're going to love it. and it's not a lot of the wealthy companies. they're going to love it. i can tell you, the people harmed the most -- and i'm concerned about the socioeconomic disparities of health care right now that are going to head us -- and i think they will hit the hospital sector pretty hard. i'm on the board of mayo, and i think we worry about this a lot. >> all right. and cheryl, very quickly. if you can. the next important moment for the hospitals after this vote. >> what amendments are going to be introduce in the senate and how far it has to move to get to the senate. >> bill and cheryl, thank you so much for joining us. >> thank you. with all that, dow remains up 72. "squawk alley" is back after a break.
. well, you're going to have to wait. that's essentially the lesson for today. we've got the house freedom caucus members of the white house right now meeting with the president. but the market is going to have to bide its time, wait for clarity on the health care vote on the hill. for now, up 72 points. pretty tight range.
>> at the same time, too, very popular safe haven trades. gold getting buying and the japanese yen, carl, its biggest run since april of 2011. signalling nervous nsz out there. >> and s.n.a.p. up nearly 35% today, well above 20 bucks. >> let's get to headquarters. scott wapner and "the half." yes, it is, the final countdown. welcome to "the halftime report, he" i'm scott wapner, down to the wire as the house is ready to vote on the health care bill today. does the trump rally hinge on the outcome? with us for the hour today, joe terranova, jim lebenthal. and head of macro investments. we begin with the markets. there is the dow up 71 points. s&p good for eight. that big vote on capitol hill today looming. the president making that 11th-hour push now to win