tv Squawk Alley CNBC October 4, 2017 11:00am-12:00pm EDT
responsibilities for stopping terrorism. nato members are now contributing more to shared security our approach to south asia and specifically afghanistan means building upon our relationships with india and pakistan to stann stamp out terrorism and support the afghan government in providing security for their own people isis's fraudulent caliphate in iraq and syria is on the brink of being completely extinguished thanks to an aggressive new strategy led by the president. what we have accomplished, we have done as a team. similarly, secretary mnuchin lobbied economic sanctions on north korea and related entities countries must increasingly decide whether they will do business with north korea or the community of peace loving nations. ambassador haley has spearheaded and achieved enormous success, passing the toughest u.n. sanction toss date on north
korea. general mattis and i communicate virtually every day, and we agree there must be the highest level of coordination between our diplomatic efforts and our military efforts you can't have a stronger partner than secretary of defense who embraces diplomacy, and i hope he feels he has the partner he needs at the state department this is just the beginning of the list of partners and friends across the government who are all working for the american people there's much to be done, and we're just getting started to address a few specifics that have been erroneously reported this morning, the vice president has never had to persuade me to remain as secretary of state, because i have never considered leaving this post. i value the friendship and the counsel of the vice president and i admire his leadership within president trump's administration to address the many important agendas of
president trump both from a foreign policy perspective and diplomatic -- i'm sorry, domestic objective let me tell you what i've learned about this president, whom i did not know before taking this office, he loves this country he puts americans and america first. he's smart he demands results wherever he goes, and he holds those around him accountable for whether they have done the job he's asked them to do accountability is one of the bedrock values the president and i share. while i'm new to washington, i have learned that there are some who try to sew dissension to advance their own agenda by tearing others apart, in an effort to undermine president trump's own agenda i do not and i will not operate that way and the same applies to everyone on my team here at the state department
when i wake up in the morning, my first thoughts are about the safety of our citizens at home and abroad there's no more important responsibility i carry with me than ensuring that americans are safe providing for the security of the united states must be the number one goal of our american foreign policy president trump and his administration will keep moving forward as one team with one mission, doing great things for the united states of america to make america great again thank you. >> is that the only thing you consider to be erroneous in that article? >> i think it's the most important out of the article to reaffirm my commitment to this role president trump has asked me to serve and dispel of this notion i have ever considered leaving. i have answered that question repeatedly for some reason it continues to be misreported there's never been a consideration in my mind to leave. i serve at the appointment of the president, and i'm here for
as long the president feels i can be useful in achieving his objectives. >> mr. secretary, do you agree with secretary mattis the united states should stay with jcpoa? >> we've have a recommendation for the president. we're going to give him a couple of options to advance. jcpoa represents only a small part of the many issues we need to deal with when it doss iranian relationship it's an important part of that but not the only part. i've said many times we can't let the iranian relationship be defined solely by that nuclear agreement. >> can you address the main headline of the story you called the president a moron. if not, where do you think these reports -- >> i'm not going to deal with petty stuff like this. this is what i don't understand about washington again, i'm not from this place but the places i come from, we don't deal with that kind of
petty nonsense it is intended to do nothing but divide people and i'm just not going to be part of this effort to divide this administration. >> mr. secretary, do you speak with the president, did he ask you to make a statement? >> i have not spoken to the president this morning i think he's on the way to las vegas is my understanding. >> the foreign minister, reliable partner -- [ inaudible >> the pakistan relationship and u.s. relationship is extraordinarily important regionally as we rolled it out we spoke in a regional context it's not just about afghanistan, this is about the importance of pakistan and pakistan's long-term ability as well. we have concerns about the future of pakistan's government, too, in terms of we want their government to be stable. we want them to be peaceful. many of the same issues they are
struggling with in pakistan are our issues we think there's opportunity to strengthen that relationship we're going to be working very hard at all levels from the state department to the defense department to our intelligence communities as well as economic commerce opportunities as well so it really is a regional approach pakistan is critical, i think, to the long-term stability of the region thank you very much. >> that is secretary of state rex tillerson pushing back hard against a report that he considered resigning over the summer in his words, i have never considered leaving this post tillerson widely considered to be one of the most effective spokespeople for the administration calls the president smart, says he loves his country, puts america and americans first. as i'm new to washington, i've learned there are some that try to sow dissension to undermine the president's agenda
i do not and will not operate that way he was asked specifically if he called the president a moron following a meeting in july and refused to address it directly saying he won't get into that petty nonsense. >> petty nonsense, right did not refute it but did say he never considered resigning and gave full throated backing to president trump, his agenda. also said he did not speak to the president today, who is on the way, by the way, to las vegas right now. our kayla tausche has been monitoring and has some other headlines for us clearly secretary of state rex tillerson staying on and backing the president and his policies >> this is a rare appearance, to say the least, by the secretary of state who does not do these things for him to come out and not only affirm his commitment to the president and what he calls the president's foreign policy goals, not those of the state department is quite a remarkable event that we saw this morning but also dispelling this notion
he would resign. it was perhaps the most detailed and well sourced of those reports, they have been coming for months at this point perhaps he felt that the reporting had just reached a fevered pitch. especially ahead of crucial foreign policy trips in november to asia, where he just returned from, where he was trying to lay the groundwork, that he wants to make sure there is no doubt in the unity between the state department and foreign policy goals of the president and the white house. so quite a remarkable scene we just saw the secretary of state making those comments and fielding questions on a wide variety of issues because there are so few occasions on which reporters get to ask him about those things. >> thank you for that. market did get a move on some of this mike santoli, as we work our way on "squawk alley" on the east coast. maybe some investors holding
steady ahead of the pressor. >> holding back a little bit maybe a little relaxation after we did get the press conference. although yesterday it seemed the market was taking the morning off and you build strength throughout date. hard to separate those things out. >> watch all that and get to a lot more today on a busy news day. don't go away. i was playing golf days ago... love golf. i used to love golf. wait, what, what happened? i was having a good round, and then my friend, sheila, right as i was stepping into the tee box mentioned a tip a pro gave her.
good wednesday morning welcome to "squawk alley." i'm carl quintanilla john is at the cyber summit in boston ceo founder an mike isaac of the "new york times. good morning to you both pressure mounting on big tech. eu looking to collect $300 million tax bill from amazon citing illegal tax breaks back to '03 a similar case against apple calling on ireland to recover more than $15 billion in what it considers illegal tax benefits
given to the iphone maker. mike, we've had people on this show suggest perhaps the biggest threat to some of these companies is directly out of brussels and specifically regards tax. you agree? >> yeah. i think vestiger is making up for short comings over the past few years. we haven't seen any real prosecution or persecution of these companies in the united states so over in the eu, this is where they feel vulnerable obviously dpoog had all these cases they were flying big time over there facebook is waiting for the hammer to drop overseas. i think that's where a lot of their pain is going to be. obviously you see what's going on with facebook in congress right now. that's probably the other hammer to drop. >> i'll take the other side of that, mike why is it right for the eu to do
after u.s. technology companies that made legal deals with foreign governments, luxembourg and ireland. isn't that antitrust and monopolies >> that's totally fair i think tim cook earlier this year called it pretty cal crap, which is not entirely far off. they are sort of, as you guys no eu harps on privacy a lot more than the united states does. in the absence of going after them on that root night now, i they are trying to find other issues tax issues that seem like the easiest way to get at that >> jason, obviously potentially on this amazon eu thing, it could be just writing a check at the end. maybe it's not that big a deal
these companies are fighting this multi-front war they feel as if they are all of a sudden cast as bad guys. i guess the big question is have they unfairly been cast in this way or are there legitimate behaviors that really have to be change among these big companies nf ye >> yeah, listen. people played by the rules the rules change eu looking at huge cash reserves sitting in bank accounts in the eu and eu countries. they are saying we're going to take our piece of that if you want to cheat on your tacks or play funny games on your faxtaxes, go ahead and do a in the united states, if you want to pay off politicians, do that in the united states but it's not happening here anymore. it's part of the populist movement if you're in the technology business, pay your taxes and don't expect to be able to buy up instagram and whatsapp and
have it sale through d. o.t. and doj. population saying if you can't give us health care, why should you give us crazy tax break. this going to dove tail with the populist movement in the united states with trump. it's going to be a very fine filter if you want to acquire stu stuff. the big failure of leadership from obama to trump, these are retro active fines we have to get that number here so it's harder trump made a huge blunder by going after obamacare first. he should have done repatriation of cash, stimulus, tax breaks, then obamacare. >> to be fair, they are working on tax reform right now front and center, diswrasjason and repatriation is a big theme. it's month nine. he spent nine months fighting over people's health care. put that aside get the repatriation money back. that results in m&a and jobs
do stimulus, that results in jobs tax break, that results in jobs and growth >> you're not the first -- >> took the strategy from jared kushner. basically when your son-in-law is giving it to you. sorry. go ahead. >> mike, to the point about election interference and being defensive on the hill now, you've got facebook with a full page ad in the journal and "washington post," again, outlining the nine things zuckerberg said the company would do to protect us from election interference in the future does this sort of thing help >> they are trying to go after the folks. they also, by the way, had an ad in the "new york times" this morning, too they are really hitting all the big newspapers sorry had to plug my employer. >> i only subscribe to digital. >> but you're right. they are trying to sort of blanket -- right now they are getting hammered by everyone who is sort of realizing the extent
of what facebook's platform can do this real awakening as to what digital advertising does, you know, a lot of these realizations we're coming to are not particularly novel in at least as far as the technology works. it's more who is able to use it and who has been able to don't it for particularly nefarious purposes obviously the russian-linked ads are doing more than just saying vote for a particular candidate. it's really driving these sort of social divisions that are going on right now i think facebook is trying to say, look, we're doing whatever we can to figure out what went on these are the ways we can prevent anything like this from happening again. >> although, i was just going to bring up this one point and we'll hear from you jason. we did hear in the last hour from fbi deputy director mccabe. he was talking to our eamon jave javers
he said he had a lot of respect for mark zuckerberg. it's not so simple and straightforward as all of washington right now is against some of these technology companies. perhaps facebook just has a bigger role helping authorities like fbi. >> facebook is -- >> i think that's fair. >> go ahead, jason i know you want to jump in. >> facebook has a track record of tlooes trustworthy company in silicon valley, under 20-year audit and fine with ftc when all this nonsense came about with the russian. they can ban ads for affiliates for amazon but can't ban racist ads. they shouldn't have been allowed to buy snapchat and whatsapp we wouldn't let radio stations create conglomerates.
>> they screwed every partner they ever worked w anybody who gets into business with them wakes up with their throat slit. this company has to be regulated and it has to be harsh regulation they should not be allowed to buy any more assets. every user who logs in should have the option of do not track. i do not want my gender tracked, i do not want any tracking that should be the gold standard if you have to pay $10, $5 to do so, fine let them make money that way you cannot trust facebook. they did all of this bad behavior while under a 20-year audit. how many chances did zuckerberg get. it doesn't matter how many cities he goes, how many cows he milks, how many apology letters he writes, you cannot trust zuckerberg. >> let's switch gears to uber. the company's board proves a series of corporate changes,
multi-billion dollar investment from the bank which holds other on demand services like grab uber says it will create as many as two new seats, including resolution to go public by 2019, a day after traveling to london as they strug toll stay viable in that city we can turn to both of you guys, mike, i'll go to you first and have you tell us where we are in the evolution of uber. >> yeah. so you know, the board, as y'all know, has been quite fractious in the past. there is a power play between two sides. on one side, the former ceo really trying to fight back power in the company and another investors bench mark trying everything it can to get travis out of the company. the issue here is who on the
board is on who's side the addition of six new seats is trying to balance that out more. i'm excited to see what 17 members on a board is going to look like for uber especially before they go public. but this is an attempt to kind of split down the middle and not favor either side too much >> jason, where does this lead the new ceo with this pord structure with 18 month road map tom ipo. does it set aside this and let him do what needs to be done or still in that sort of haze of conflict >> as an investors in the first round uber ever did when it was a $4 million company it's the happiest day of my life on professional basis to see these fights end i'd like to congratulate mike and kara swisher for joining the board. they have so much information it's unbelievable.
it's great to see we're on the road to ipo. it's great to see massive growth that spiked the chaos that occurred in 2017 as a shareholder i cannot wait for 2017 to end and for us to be on track to focus on the core business which, let's face it, what's amazing about this company is despite all of the mistakes that have been made, we are still growing at a tremendous pace. i think it's fantastic that travis remains involved in the company, despite the mistakes he's made, i am still a huge travis fan and i would like to see him regain the ceo spot in two, three, four years i think there's a path to do that i think dara is the right person to take it public. i think he's the right person to lead it through these troubled times. nothing would be better than travis to support dara through the next two or three years and then regain, like steve jobs did, his seat at the top of the company in 2021.
>> mike, in a word, will that happen >> i would -- honestly, i would love to see what travis has planned for the next few years the door hasn't been closed on that twitter was famously called a clown car driven into a gold mine, so now i'm wondering if this is a self-driving clown car driven into a gold mine. >> this clown car is growing 20% quarter over quarter in jack's tenure in the last two years it hasn't grown at all. >> jason, some of the other competitors like lyft have been making inroads in market share and investment they lost london and now have to go on the charm offensive to win it back. there's challenges and signs of damage from all the turmoil. >> the cleanup continues but i'll tell you this, lyft was getting absolutely demolished by uber when it was at the top of
its game when travis was running the company. so all of these investors can complain about the mistakes that were made, but this was a company that grew faster than any other country in the history of silicon valley under one person, travis we need travis involved in the company. dara's leadership is going to be a great compliment travis needs to be there if lyft enjoyed a little bit of market share dpan while youtugas stumbling, that's short-lived. we're back in the game, the team is aligned whatever gains lyft made they are going to lose in 2018 and 2019 you heard it here first. >> great to have you guys together jason cal canis and mike isaac thanks so much when we return former equifax ceo rick smith back on the hill facing a grilling this morning from elizabeth warren. electric push kicks into career.
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former equifax ceo rick smith back on capitol hill this morning facing senate banking committee this time. aditi roy on the scene got heated between senator warren and mr. smith what else happened, aditi. >> reporter: yes the hearing going on he's seeing a tough crowd with the nearly two dozen lawmakers in the senate banking committee. among those was senator elizabeth warren let's listen in to some of those pointed questions she had for him. >> a company like equifax that has sensitive personal information on most americans should have the best data security in the industry instead it has the worst. >> reporter: she also asked smith about the profits the company has made since the hack.
>> you've got three different ways that equifax is making money, millions of dollars, off its own screw up meanwhile the potential cost to equifax are shockingly low consumers can sue. turns out that the average recovery for data breaches is less than $2 per consumer. equifax has insurance that could cover some big chunk of any potential payment to consumers so i'm going to look at the big picture here from 2013 until today, equifax has disclosed at least four separate hacks in which it compromised sensitive personal data in those four years, has equifax's profit gone up mr. smith? >> yes, senator. >> yes, it has gone up, right? in fact, it's gone up more than 80% over that time.
>> reporter: he was asked also about the stock sales by three executives at equifax shortly after the breach was discovered and smith reiterated his statement that to the best of his knowledge that those executives did not have knowledge of the breach when they made those stock sales. the lawmakers here expressed a lot of scepticism and many of them talked about how it didn't seem to pass the smell test. we'll be back in there and send you more updates as this hearing progresses back to you guys. >> all right we'll check back in with you aditi roy, thank you. when we come back, comments on ceo of s.n.a.p. going public, evan speiegelspiegel meantime checking on dow and s&p coming spoke positive territory here after we closed after another record high. all building on gains. "squawk alley" will be right back
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and precious commodities. and when industries are undergoing massive transformation, opportunities are only opportunities if you can find an answer that separates fact from near fact. thomson reuters provides you the intelligence, technology, and human expertise you need to find those trusted answers. the answer company. thomson reuters. . good morning once again, everybody. i'm sue herrera. here is your cnbc news at this hour house democrats making an emotional appeal on capitol hill for stricter gun control laws. former representative gabby giffords who was shot in the head by a gunman in 2011 calling for bipartisanship to enact the gun measures. >> now is the time to come together, be responsible democrats, republicans,
everyone we must never stop fighting. fight, fight, fight. >> a ruling to extradite cyber crime suspect to the united states where he's wanted in a $4 billion bitcoin case he was arrested in greece in july he's expected to appeal that decision. an entertainment mogul david geffen donating $150 million for construction of a new building of galleries at the los angeles county museum of art the museum said it is the largest single cash gift from an individual in its history. it will be a wonderful addition to the city. that's the news update this hour back downtown to "squawk alley." carl, back to you. >> sue, thank you very much. we want to get to the latest on the investigation surrounding mass shooting in las vegas over the weekend. for that we'll go to jane wells. good morning once again, jane. >> reporter: hi, carl. the president will land here within the hour.
he'll meet with victims and first responders we've had a lot of developments overnight. first, stephen paddock's girlfriend we have video of her arriving lax from the philippines. she's met by fbi she's a person of interest they hope she can help them determine a motive second, stephen paddock's room where he set up cameras in the peephole for the hallway police say 67 officers wearing body cam sunday night and here is what some of that looked like police at times met with disbelief from concertgoers who thought it was just firecrackers among the 58 victims, paddock is 59, a las vegas off duty police officer at the concert with his wife.
>> even though officer hartfield was at the concert as a civilian, he immediately took action to save lives in that moment he was acting as a police officer he ultimately gave his life protecting others. officer hartfield was 11-year member of lvpd and leaves behind a wife and two children. we're very grateful for his sacrifice. >> reporter: there are probably more cameras in las vegas per square foot than any other nongovernmental place. more security, more technology, but could things be made safer here with technology, even with, you know, cameras on slot machines that was top of mind at the huge global gaming expo, a big industry show taking place here this week. >> when you look at security and surveillance, the gaming industry has long been seen as a leader on this front so there's no doubt there are a lot of lessons, best practices here in las vegas, and we're going to have to go back and figure out what else needs to be done
>> finally, the family of eric paddock, the gunman's brother released a statement which says in part. like everyone we are learning details about what happened as they come out. there's no way to express shock, devastation and sorrow for all the victims and their families unimaginable loss. guys, the president is calling it a sad day back to you. >> jane, thank you very much for that we want to take you back to washington, d.c. our aditi roy with senator warren aditi. >> equifax has tried to shuffle his way towards some kind of credibility and it just hasn't worked republicans and democrats have both said this is a broken company and this is a broken industry we need to make real change. >> first of all, just your initial thoughts about his responses. were they enough >> no, they weren't. but let's keep in mind, there was a structural problem we talked about in there. equifax -- as staggering as this
is, equifax is actually making money off the breach so while 145 million americans around this country will have to worry about identity theft for the rest of their lives, their social security numbers will be out there, their pert days will be out there, their phone numbers will be out there, their home addresses will be out there, what equifax is doing is actually making money. they sell a product that they have offered for one year for free but after that, it has to be renewed. if just one in seven of the people who have taken up the offer for free protection renew for just one year, that's $200 million more for equifax when you look at other companies that are offering credit protection services, it turns out they do through equifax. so every time someone goes to life lock, equifax is making
some money off that and equifax sells information to both businesses and to the government to deal with identity theft. since identity theft is more likely right now, equifax makes more money that is a company that is broken that is a market that is broken. >> there's been a lot of talk about regulation -- >> what about equifax ceos who sold that stock. do you buy the excuse these are honorable men following the rules? >> look, the basic story in there is these are the luckiest guys who ever walked the face of the earth. they were in a position to get the information and make money off it, but they didn't get the information. they covered their ears and got lucky enough to make money on their own. that's why we need a strong securities and exchange commission to do a thorough investigation into whether there's been insider trading the story we heard here defies credibility.
>> senator warren, why is it the government's role to step up and regulate equifax is there any concern about this being a slippery slope >> i'm sorry, who do you think is going to equifax? what equifax just promised if we do data breaches we'll make more money off them we'll put a ceo or former ceo out front to try to tout more money they can make money off. this is an industry that is fundamentally broken here is a way to understand it right now. as a consumer you can't decide who gets access to your data if you think equifax did a really lousy job, you can't say, hey, i'm taking my business somewhere else, because you never authorized the collection of your data to begin with even if equifax says, oh, we'll put some kind of freeze on your data, the other two credit reporting agencies don't have to do that. that means thieves can go out and open credit cards in your
name or take out other loans in your name, buy products in your name as long as it's run through one of the other agencies, you're still at risk. so the way i see this -- look, love markets i think markets are terrific there are some markets at some points that just don't work. what we need here is a different kind of market first, we need consumers to own their own data we need a world where the consumer decides who gets access to the data and who doesn't get access to the data and part two on this, we need to have real, meaningful accountability for executives. when a breach occurs on their watch, there needs to be some personal accountability. otherwise they are not going to have the incentives to run the country the right way. third, we need real penalties imposed on companies when they
leave data so that it gets stolen keep in mind here on data theft, we went back and ran the numbers on earlier cases where there's been data theft, it turns out the recovery for consumer is less than $2 apiece. so this is a whole industry right now where the incentives are in the wrong place the incentives are to collect as much data about people as possible and pump it out for sale to as many companies, as many businesses as possible. we need to change that. >> what kind of personal accountability should there be for someone like equifax >> i think the bonuses that you get, the salary you get, the retirement goodies that are coming down the line need to be clawed back when there is a major breach that happens on that executive's watch i want to say that for the ceo and for all of those at the top who were in charge you know, you may have heard in
there, there were questions about where was general counsel, when general counsel was signing off on people trading in stock after the breach had occurred. part of the problem we've got in big companies like this is that when something goes wrong and somebody has not followed through on trying to clean up from a breach of the data, the executives all play this game, right? i heard nothing, i saw nothing and therefore, i'm still okay, and my bonus is still protected. and meanwhile millions of customers are just kicked to the curb. >> one of the structural problems -- >> you call for the ceo to be fired. yet time and time again we have seen whether it's on wall street or current situation that these folks are not fired, they don't go to jail why is that consistently the pattern? the second question on another topic on the minds of many americans and that's las vegas
what needs to be done, senator, now in response to las vegas >> so let's start with the executives i'll take it in the order you asked it look, until we have personal accountability, nothing is going to change at these giant financial institutions and the only way we're going to get that kind of personal accountability is if we here in congress demand it we can change the laws and say there will be clawback, there will be consequences when major breaches happen on your watch. people talk all the time about pay for performance. how about if we make that work both ways. that is the company does great and consumers are fully protected. you make more money. boy, if it all pelosi up and you destroy the security of millions of people, then your pay is way down that money gets clawed back. >> what are the structural problems. >> i'm sorry, you had a second part. >> about las vegas, what do you think needs to be done in terms
of is this going to -- we've seen nothing happen on gun control, whether sandy hook, after orlando, what do you think should be done >> we have a serious problem with lack of gun safety in this country, and we make it a national conversation at the moment of a mass shooting. this is happening every single day. every single day in this country people are dying from guns every single day children are being killed, teenagers are being killed it is our responsibility here in the united states congress to make sensible changes on behalf of the american people not simply to be held hostage by the nra. there are a lot of different steps we could take. we could do more extensive background checks. we could make the weapons themselves safer and less likely to be capable of shooting many
people in a short period of time there's a lot we could do. right now the nra and their friends in congress won't let us do anything. i want to see us come together as a country and say the lives of our children, the lives of our friends, the lives of our neighbors, the lives of our families matter to us. we're going to start taking steps towards sensible gun safety thank you. >> senator, guoing back to equifax. one of the sources of outrage as you mentioned as a customer you can't fire equifax their clients are financial institutions how do you solve for that on a legislative level? you've offered up legislation but how do you get to that core issue? >> understand if the consumer makes the decision about who gets access to the data, so if you easily online can simply freeze your data, that means as a matter of law, nobody gets access to it
companies that are trying to sell you a credit card don't get access to it and by the way, just understand, right now equifax sells your data to companies that just want to sell you something. want to sell you a cruise, want to sell you jewelry, want to sell you a car you ought to be able to freeze your data and say nobody gets access to my data. and then if you, for example, want to take out a home mortgage, you can turn it on for a specific purpose and turn it right back off if that were the case, the entire business model for equifax and the entire industry changes. they are making money from selling your data in secret. >> they are offering a plan starting next year, that would allow customers to automatically lock and unlock their account. is that sufficient >> no. i'll give you multiple reasons why. first of all, what they are offering to lock is not clear. whether they are offering to lock it so that no one can pull your credit report but that they
still want to be able to sell data out the back door so others can sell you other items so that's one part of it the second part is this is voluntary, which means at any point they can change it the third is it only applies to equifax. consumers are now vulnerable to the loss of their data and some thief going through one of the other credit reporting agencies. that's why we need to change the law. we need to make it in place, forever, and make sure that consumers have control over their own data, that that's what's guaranteed. that's what will make this market work again. >> senator elizabeth warren taking reporter questions, including a few from our own aditi roy outside that senate banking hearing where they have been listening to testimony and q&a from the former ceo of equifax on the hack. warren, guys, going after everyone from the executives saying they should claw back their bonuses to the fact they
are making money still off of this people sign up for that free credit monitoring service. if they renew after a year, equifax makes money. also going after the entire industry which she called misunderstand mentally broken and ways to address that. >> the key to try to help conss >> her effort to enlarge this beyond the one situation with equifax and it reminds me of the pharmacy benefits manager. myelin, why is the business model the way that it is that could be the ongoing story when it comes to the credit reporting agency. >> an indictment of the entire market, she said i love markets, they are terrific but in this case it doesn't work you need to decide where the consumer gets to decide how their data gets spread out and in this case sold. >> she also called on the s.e.c. saying we need a strong s.e.c. to decide whether there's been insider trading for the luckiest men on earth and some of the stock trades ahead of the
they still see opportunity and where they are taking profits today. and the scathing criticism by one well-known tech investor about facebook and its founder mark zuckerberg. if you're an investor in this stock, you need to hear this "the halftime report" starts at noon eastern mike, we'll see you soon. >> all right, scott. thanks very much gm and ford, meanwhile, announcing a major move to electric focused vehicles. for more on this issue we're joined by former gm vice chairman bob lutz. bob, great to have you here. it's interesting to watch analysts, the companiey very sur that the detroit incumbents are big in electric vehicles and are positioned to invest in the future do you think gm and ford have reached a point where they can be agnostic as to how things go from here when it comes to gasoline versus electric >> yeah. i've always said back when i was in the industry when people accused of us of not wanting to build vehicle vehicles
i said, we'll build any -- we don't supply the fuel. we don't do gasoline we don't do diesel fuel. we don't do electricity. we'll put any power source in the vehicle that the market demands, and, you know, as a relatively frequent contributor here, i have said without fail that people are overestimating tesla and underestimating a company like general motors, which as everybody seems to forget, had the first viable lithium ion powered plug-in hybrid with the chevrolet volt general motors is an extremely competent company, as is ford. general motors has demonstrate that had they can master any technology that they set their mind to, and as we now know from the cadillac announcement and the cross-country drives of the new cadillac ct six, general motors leads in vehicle autonomy as well and i've been saying this, you know, repeatedly but it always fell on deaf ears
because it was dumb old detroit versus modern smart silicon valley and in the real world that just isn't true. >> bob, if in fact these companies can provide vehicles of any sort that the market demands, they still have to make some kind of a bet on how much the market is going to demand of electric vehicles. gm talking about 20 models by 2023 do you think they have the proportions right? >> well, you know, 20 models it depends on your definition of a model, but that's still going to be a relatively small fraction of the total gm fleet, and gm has promised that they will make money on them. right now hat the cost of lithium ion per kill watt hour without government incentives it's very, very hard to see how that would be possible but, you know, even if they are break even the sale of electric vehicles even at a loss enables because of the credits you get for them, enables the sale of profitable vehicles like yukon,
suburbans and full-sized pickup trucks, f150s in the case of ford and so on. >> yeah. >> as gm emphasized when they made the announcement, don't expect this radical transformation to all electric. >> sure. >> it's going to be a thing that's going to take decades. >> appreciate it bob lutz we're in a little bit of a hurry on this end. thank you very much for your time. >> you're welcome. >> switching gears want to talk to sonos unvoilg a smart speaker called the sonos one. so are you partnering or competing with amazon, alexa and google assistant >> we are partnering in fact, you know, we're partnering with every company that has voice assistance so we're really talking about today delivering a partnership with amazon where we're allowing existing sewn existing sonos control by using their voice with a echo or echo dot and having alexa built in and google assistance by 2018.
>> if i i have a sonos. >> yes. >> and i really only use alexa for music, can i get rid of the alexa? >> what i would recommend is using the alexa to control the sonos with your voice so you can actually use an echo or echo dot to control your existing sonos in that snarior or add the sonos i to your collection and control the entire system there? >> then you have multiple speakers >> echo dot, for instance, you could be controlling your sonos throughout your home you may want to add the sonos i to one room in your home sonos is a system so it's not like many other things out there where it's devices sonos is really that system and we're putting voice control from amazon into the system. >> how big of a market do you see for this >> oh, this is enormous, and i think we're just getting started in terms of where we are today we see, you know, the smart speakers just beginning to take off today. i think people are calling for 30 million, 40 million over the
next couple of years, so we think it's a huge opportunity. >> what do you say to people who have privacy concerns, don't like things that listen right, what do you say to them? >> it's a great question we've hard-wired the light to the mike so if you turn it off there's no way you'll see the light go off and there's no way to actually hack that or corrupt it because we heard those concerns from consumers, for sure, you know we've privileged to be in some of probably the most prestigious homes in the world and we wanted to make sure we had a good solution to that. >> it's literally deaf. >> exactly right. >> khost >> 199, so you can pre-order it on sonos.com and it's $199. >> trying to think how that stacks up against some. >> pretty close. >> is the big competitor going to be the apple home pod >> we partner with apple we're implementing the apple air play ii into the sonos i so we spoke of partnerships with amazon, google and apple because we don't think consumers should
have to pick one of the eco-systems. we've proven we can do that with services and we're the only one that has the music services from all three. >> patrick spence, things for joining us today sonos and showing off the new speaker. >> an eventful morning of news markets have been able to hang on to gains. let's get to wapner and "the half." a busy hour ahead. welcome to "the halftime report." i'm scott wapner our top trade. industrial strength rally. another new record for the dow this hour. how high can that average fly, and are the big blue chips the best bet for your money? with us for the hour steve weis, josh brown and the brothers najarian and ian winder, the co-head of equities at web bush securities we do begin with the major averages, the industrials and transports making another new high the nasdaq joining the party, albeit slightlas