Skip to main content

tv   Squawk Box  CNBC  August 29, 2016 6:00am-9:01am EDT

6:00 am
this is "squawk box." good monday morning everyone. welcome to "squawk box" on cnbc. i'm kayla tausche with becky and andrew are off today. look at where u.s. equity futures are at this hour. negative territory. but currently slightly positive. the s&p opens by one point, the dow opens by two points and the nasdaq flirting with a break even line for the implied open. take a look at where we are. strength in japan by a weakening yen against the dollar based on comments from kuroda in jackson hole. they have ample opportunity to continue easing shanghai. we're going to 4 decimal places there. that's roughly flat. hong kong is slightly negative. europe equities, we have been fairly negative throughout the morning. you're taking a look at the broader european averages. every single one of them is negative. the ftse is a little bit of an
6:01 am
outlier. that is the close from friday. they're having a bank holiday in the uk. finally, take a look at where we are on crude. it's been sliding throughout the morning. it's been in focus for equities here in the u.s. and across the world. wti just slipped below $47 a barrel. it's down 1.5%. brent is trading roughly lower by about the same. that is below $50 a barrel. scott? >> loud noises at los angeles international airport causing panic late last night as many confused the sounds for gunshots. passengers at lax were seen running from terminals on to a tarmac after police responded to 911 calls from many locations about a shooting at the airport. around 11:45 p.m. eastern time. police conducted two sweeps and concluded the reports were unfounded and there was no shooting. in business news. look for personal income and spending. on tuesday, we get the home price index and august consumer
6:02 am
confidence. wednesday, it's adp employment report. chicago pmi and pending home sales on thursday. look for the revised second quarter productivity and the ism manufacturing index. on friday, we close out the week with the august employment report. >> what do you mean jobs report already? >> yeah. >> i was thinking that, too. i realized it was this friday. >> it was also -- i was also thinking august 29th, bummer. >> the end of summer. >> reminds me of the sonnet, what you see in the leaves and what you see in me. colors are changing, i'm getting wrinkly. >> i don't go back to school but i get that feeling, that dread. >> the pits. >> exactly. everybody says, i don't know who was here last week, it gets confusing. was it you? >> you used to love going back
6:03 am
to school for the close? >> love it. the annual trip to targets to get the new lunchbox. focus on the supplies. >> i don't care how many supplies you get, i don't care how many clothes you get -- there's nothing -- >> zero. >> after the summer. you get used to that -- the three months, remember when you were a little kid, three months was forever. >> you're never going back to school. >> stocks to watch today. i mentioned this at the open. roche says that the fda issued an emergency use authorization for a viral test for zika. the test is easy to use and can allow doctors to quickly detect the virus. >> the mosquito bites. >> the mosquitoes love me. i don't know if it's my blood --
6:04 am
she was somewhere -- i mean, summer up north in new hampshire. that's fine. >> you get weird. they find me wherever i am. they find me. >> the guardian is reporting that mylan's ceo sold 100,000 of her shares earlier this month for a profit of $5 million. it took place august 9th, really before any of the controversy. it was the same day that mylan reported earnings but before everything hit the fan over the price of epipens. mylan says that the move was part of a predetermined stock sale which work really well for people that can always just fall back on that, right? >> remember, it was the famous angelo ma zillow, remember him. it was all, no, no, no. >> hard for me to say. that sounds like elmer if you had. country wide.
6:05 am
elmer fudd. >> i know who he is. >> i'm driving in my car, remember that? >> do i want to what? >> mansion and a yacht. >> my name is elmer j. fudd, i own a mansion and a yacht. do you remember that episode? >> no, i do not. >> killed the rabbit. ♪ killed the rabbit ♪ >> my name is elmer j. fudd -- >> was he a millionaire? i thought he was a hunter. >> probably he was that too. >> i better pull that up for you. >> the two of us together. >> we're tackling life ease deep questions on quack box. >> it is 6:00 a.m., it is a monday. >> you look it up. >> they're jointly developed cholesterol drug met targets. it's intended for patients with my cholesterol who don't respond to statins which are the most commonly prescribed medicine for that condition.
6:06 am
i tell you, the drug industry without dealing with cholesterol for 20 years, would they have sold anything else? they've really been whipping that -- i guess it does matter. heart disease. i think there's a good linkage between high cholesterol and heart disease. lipitor, i think of all of drugs -- >> selling epipens too. >> it wasn't as lucrative as for the last couple years. >> we mentioned mylan under fire for it it's going to launch a generic epipen auto injector at a discount of more than 50% from the brand name product. the list price will be $300 for a two-pack. mylan expects to launch that product in several weeks pending completion of labeling revisions which is weird. they're launching a generic against their own thing. just begs the question that i think it's coming down at any time. is this different than just cutting the price to $150 per
6:07 am
epipen? how is it different than that when you're the company introducing the generic? like folding, don't you think, wapner? >> yeah. they've hiked the price twice in the last 12 months. a 15% each time. >> we've talked about this. you need competition. you need competition or else there's no -- otherwise, you have to -- >> maybe you just need more or less. >> that doesn't equate -- how would you ever -- that's the whole idea of capital itch. you never know -- >> this is not capitalism. >> the drug delivery had -- >> they decide on every price, every product a company sells -- a pharaoh owe. >> common sense decides at some point. common sense should play a role in the conversation too. >> i'd rather not leave -- common sense every single person has a different idea of common sense. every single person has a different idea of fairness.
6:08 am
i'd rather have the market dictate how much you can charge. >> who other than the ceo, the board and shareholders of mylan look at the price hikes and the ridiculously absorb tant price of the epipen and say that's cool. >> measure margins. there's no way that -- because they're so good at making chips should charge -- a fair margin price is 10%. unless the -- if intel's guy was moral as all, there's no way he'd sit there and charge 60% margins. and drugs cost pennies to make. some of them $50,000. there's so many things that go into it. >> is there a difference because the income chip isn't saving your life? >> there's no way that you can leave pricing to some type of subjective fairness analysis. is has to be a -- >> did the cost of making an epipen go up 600%? >> the doing this to make a
6:09 am
ridiculous point. you know i'm right about this. what dictates pricing -- >> there needs to be pushback. >> just read there. there needs to be competition and innovation. someone says i can make an epipen and make a decent profit for $80. >> should it have been -- >> i don't know what -- how you decide. >> i know there's no competitors. i'm going to jack the price up to outer space that's capitalism. >> that's what you try to maximize profits. that's something that all private companies try to do for shareholders. maximize profits. until it becomes where someone else comes in and says oh, no, that's way too much. we're going to do it for this much and somebody else comes in and we've got innovation, we've invested, we're going to do it for this much. we have employees working harder and more productive. we're going to do it for this much. you can't expect people to say, what's a good price, 140, 380.
6:10 am
i feel better if i charge 80. it's not the red cross. if you want all utilities -- maybe there should be zero profit. you pay your expenses and you're done. >> i'm not saying they're not valid points. i'm saying, this is not the way that the best of capitalism is supposed to work. i'm sorry, that's not it. >> i'm not leaving people to decide what's right and what's wrong with this. you can't decide things like that. >> i think -- i don't think anybody needs to decide what's right or wrong. you look at the price hike of x 100% over what period of time of time it is and say really? that's cool? >> yes, shareholders. shareholders -- until someone comes along and undercuts you -- you say that -- >> if you're -- of course they should. if you're a mylan shareholder
6:11 am
and you see that this has happened and draws all this scrutiny, are you happy with that or say what is our ceo thinking. >> that's not maximizing profits. then you've gone too far. >> are we there? >> probably. you're arriving at that point a different way. you're still talking about maximizing profits. but the pr is hurting the company's ability for shareholders. then you would -- >> if you want to go that route, that's fine. capitalism needs to work with competition. it's the government's fault for not having more -- i don't know what fda was thinking about not allowing generics. >> i don't either. >> blame them. it's always the government, you know that. >> i do. i'm sending you the link to the elmer j. fudd thing right now. >> he would not have become a billionaire without capitalism. >> this is my -- >> we are counting down to friday's jobs report. joining us now it deutsche bank chief u.s. economist and
6:12 am
executive vice president of northern trust. good to have you both us. joe, we'll start with you. you're right here. friday jobs report, sealed the deal for september. this friday. >> no. >> i mean, if the number is really strong. 300,000-plus the unemployment rate falls. >> what if it's 200,000. that's strong. >> it is. that's a good number. the fed looks at the market. they're hostage to markets. it's getting crazy. >> the market has been offsides on this all along. they have said the fed is not going to go. fed funds futures going into friday were, i don't know what the numbers were. >> it was zero a month or so ago. >> the fed was saying on friday, the market is wrong. >> fed has been wrong pretty much -- but the market has been saying the rate is about 1%. the feds have been saying 4 and reduced it to 3.5 and put it to 3. it's kind of pathetic. the market is saying they're going to go once this year, which i think is right.
6:13 am
i still think december. >> december. >> carl, what do you think? >> so i'm always confused when people say the markets are saying one thing or another. who are these people. they think there's a 75% chance we'll get a rate increase by the end of the year. you have to be careful in inferring fed forecasts because trading is influenced by a lot of factors other than what monetary policy ought to be. that said, markets are not reacting in the manner you would expect after a strong employment report and some speeches. they've backed off chances that we'll get an increase at the end of the year. if the fed thinks the market misunderstands, there's a clear -- our economy is in fine shape. in order to avoid financial excess down the road, we're going to remove excessive
6:14 am
monetary accommodation. >> the market has been dictating to the fed all along. kb what i said with joe, this is the first time to get the conversation back if you will. >> it -- one is dictating the other. it is ideal for markets. >> the market has though few surprises lead to greater financial stability. which is what all banks are seeking. >> it's undeniable. >> dictated to the fed. >> if you look back -- the last since at least bernanke can go back to greece. the fed has never moved on a hike without fed funds futures pricing something like 70% chance. this fed is led by the market perpetually. the fed has arguably little credibility. doesn't matter what stan fischer says. when lease man interviewed
6:15 am
him -- >> i thought that was sexist. >> the fed has always covered itself with the fact that its policy [ overlapping talking ]. yellen, it's what i was reading from different -- didn't do much on the talks. the thing, joe, is that yellen is super -- it's yellen and dudley for the most part. fischer has been perceived more hawkishly. when fischer came out so soon avielle en's talk on friday, they figure -- >> why do -- [ overlapping talking ]. >> why not price it at minus 30e. we should go to negative profitability. >> negative interest rates. >> might as well go to negative probability. >> the fed will have a credibility problem again.
6:16 am
[ overlapping talking ]. >> when leashman came out, he said yes and yes. that's the way you should read yellen's comments. >> sure, absolutely. they probably think they can move in november or late october, which is absurd. >> of course not. >> when you say strong employment report, i guess if the report is so ridiculously strong and the market prices are going to move, i guess they could go. this is sort of the supervised situation where the -- got the data. it's absurd. >> the economy is strong enough -- >> the economy stinks. >> i used to be bullish. the economy has grown barely above 1%. in nominal terms, shrinking. this is a horrible economy. >> it's hard to take 2/3 of the economy out of the equation. you got to remover the consumer. we've had an inventory correction the last couple of quarters.
6:17 am
we're seven years into an expansion. you would expect growth owe. [ overlapping talking ]. >> we've had deleveraging going on at societies and globally at all levels. that's held down demand. i don't think you can dismiss the demand side of what's going on. right now, we've had great job creation. it creates a lot of demand to carry over to consumer spending. this is -- there's still potential momentum here. i also don't want to overplay the idea that even if the economy is weak, the reason we have -- low levels of interest rates are driving investors into places they don't normally go, could be a problem. >> there is a problem. >> we have house prices back to where they were in 2006. commercial real estate was mentioned once again during jackson hole and in the fed minutes as a source of concern. you've got equity valuations and i'm not an investment
6:18 am
professional, so i don't play in that sand box. some would say they have been pressed to multiples that are not natural for this point in the earnings cycle because investors are trying to avoid low interest rates and realize their yield objectives. ziemt carl, thanks for joining us. joe good to see you. coming up, carl icahn and bill akman sparring over her balanceife. donald trump looking to set up questions over his immigration policy. giving a major speech on wednesday on the topic and in arizona. we're joined with a recap of the weekend's top political stories when we return. ♪
6:19 am
[announcer] is it a force of nature? or a sales event? the summer of audi sales event is here. get up to a $5,000 bonus on select audi models.
6:20 am
6:21 am
carl icahn buying additional shares late on friday. the billionaire investor may have been interested in exiting in august. jeffries and. ubs were working independently to find investors. but nothing materialized. in a statement icahn denies he attempted to sell his stake,
6:22 am
rejecting claims that were made in a "squawk box" interview here on friday morning that he had been offered some of icahn's shares. icahn didn't dispute he recently considered selling but blasted ackman saying, "it amazes me a guy with no knowledge of my internal investment thinking believes he's in a position to go on television to tell the world what i am thinking." we're joined with more now. this was huge news on friday morning on this set. really continued throughout the entire day. >> it did. i really can't believe the way the story continues to unfold. i think there are a couple of key points to bring up here. i think there are two issues. joe and i were talking about this during the break. number one, did carl try to sell and it sounds like he confirms at least considering sell for a moment in time there. or was there something a little more nuanced going on, like the idea of soliciting bids for a block of shares as opposed to say outright, i'm unloading these, what can we do here.
6:23 am
let's play sound from ackman that clarifies this point. >> we're trying to take a block trade to take carl out. i said absolutely not. there were kind of -- everyone laughed about it. then they said, obviously we can get carl out that, will help you. i said that's true. so what i said to him, i said, look, go find buyers for this thing. if you can find buyers, that's great. they went shopping, looking for potential buyers. >> okay. so my read here, i think there's word parsing going on. it's clear that at least for a brief period, icahn acknowledges considering selling and apparently engaged jeffries and possibly ubs to help him out, see who was out there. ackman was a possible phone call. does ak man get in over his skis when he tries to say this is what carl is thinking and is
6:24 am
carl right to shut him down in that regard. >> when someone sends a signal, that obviously tells the market something. if you're on the other side of the trade, you're going to interpret that as you will. to me, coming on air talking about that seems like fair game. >> want to go a step further and buy more? >> we talk about how icahn has deep pockets, especially with the herbal life trade, ackman offended a lot of people going short and people took the other side even without strong convictio convictions. >> he did that as an owe he that was a total -- [ overlapping talking ]. >> there you go. the reason he did it. look x ackman said he bought at 30. he doubles his money at 60. that's all he had to say. for him to say this indicates that carl knows this is a scam and carl thinks this is toast and the business model is going to change because of this
6:25 am
settlement, he's telling people -- carl, i don't think he wants to be seen as someone who just was expedient in a scam, took his double and then got out. i think carl has said this is a real company. >> right. he's on the board. he must think so. >> he doesn't think it's a scam. >> ackman went too far. he opened his big mouth and said look, carl thinks it's toast. when i was watching, it was like he should have left well enough alone. >> that's bilk bill, isn't it, scott? >> talk his book, again. >> i wonder how the day would have transpired had there been no interview in morning? >> he might be out. >> the first question is, we'll never know in. who leaked the story to the "wall street journal." the mere existence of the story was going to spur this. i think at some point certainly ackman was going to weigh in and maybe icahn too. so you got to wonder, was that
6:26 am
sort of a loose lip third party with no ax to grind. was that one. parties on either side. again, we won't know. the mere existence of that story got the ball rolling. >> you've seen ackman and how ruthless he's been talking about herbal life. going on a podium on tv to get the narrative out that it's a pyramid. he's not pulled any punches. the latest thing is to say icahn agrees with me that it's a pyramid. it's going to be toast. even he's the last man standing, all the other guys are out. icahn is now out. it was another way to drive the shares of herbal life down again. >> if he had strong conviction about the company and wanted to make it a long-term play, why would he briefly consider
6:27 am
selling it? >> he's already made it a long-term play. it's up like 75%. >> no question about it. >> since he bought it. i don't think anybody could have predict add at the end of the day on friday given what happened on this show in the morning that icahn would have -- >> i saw that. i laughed. he could be out next week. who knows with carl. remember apple? that was like a week later it was going to a trillion dollar market capital. a week later, boy, i'm out imt carl is mercurial, right? he's the most unemotional investor -- >> i don't know this was emotional on friday. >> on the fundamentals of the investment itself. >> but you can see -- >> obviously, there's emotions about [ overlapping talking ]. >> for them to issue a dividend and buyback and all of the above that he wanted. after a couple of years -- >> the point is correct that this has been a long-term play for him. i don't know if we have that chart handy. but he's made incredible returns on it. like 77, 78% when i was looking
6:28 am
at the life of the investment. late december it was 2013 until now. however, if he felt like it had great prospects going forward -- i'm sorry 12. why would he have considered selling it? granted, it's been a great investment. to the credibility and the belief in the company question, you would stay in it longer if you felt strongly about that. >> ackman on friday, he had me convinced that the settlement was going -- he had me convinced that the only people that buy anything are distributors. if you have to book revenues with what ends up in the hands of the people -- it would be like zero. he was implying that icahn said the same thing. to see icahn come back at 60. >> i would answer your question. when carl went -- when an investment runs its course with carl, it runs its course. that's it. done. move on to the next one. that's what i mean about being unemotional and making those kinds of decisions. the stock went up 70-some-odd percent since he bought it.
6:29 am
he sees that. maybe there's questions about the settlement, what's it going to be mean for the business going down the road. i've made great money. i do believe in the business but at some point they all end. >> he's willing -- that guy is willing to lose 50 million to make a point. >> he is. >> why wouldn't he be? he has how many billion? 10, 15, 20. something like that. >> the key counter point to ackman's -- on the earnings erosion of this company that would bolster carl's fundamental point of view would seem to be, it's just the u.s. business that reached the settlement. by the way, the settlement has not kicked in. all the international businesses are unaffected. can go on doing what they're doing. it's a relatively small slice of the revenue pie. even if it erodes, it could take a long time and they could bolster the overseas operations to counteract whatever losses
6:30 am
are here. >> it was an amazing day. following it from away and participating in it to some respects as well to crazy day. >> we missed you. good stuff. kate, thanks. thank you. speaking of carl icahn. he will be one of the speakers joining a blockbuster lineup for the delivering alpha investor summit produced by cnbc and institutional investor. we'll hear from treasury secretary jack lew. paul singer of elliott management, among others. all taking place september 13th. delivering alpha.com. >> where were you last night? was there an anti-capitalism rally? some bernie sanders. >> anti-epipen price hike thing. >> everything should be a utility typo owe. >> just boycotting. >> we agree with each other on both the points, i know that. you know what, you know who really understands fair pricing and morality? congress. while we're pricing any of that stuff, get legislation in there.
6:31 am
let the democratic congress control pricing on all of this stuff. they're very moral. >> coming up, headlines from the campaign trail plus we'll show you -- >> we agree more than we disagree. >> the first time six nasa scientists left a biodome in hawaii in a year. take a look at last week's s&p's winners and losers. >> i am elmer j. fudd, millionaire. i own a mansion and a yacht. when whirlpool builds an appliance, they put everything they know into it. but once it's sold, there usually isn't a way to keep improving that product. today, whirlpool can analyze iot sensor data from connected appliances on the ibm cloud. so they can continuously learn how customers are using their products. and how the machines respond.
6:32 am
harnessing data to make great products better - that's what the ibm cloud is built for.
6:33 am
6:34 am
harnessing data to make great products better - hey, jesse. who are you? i'm vern, the orange money retirement rabbit from voya. orange money represents the money you put away for retirement. over time, your money could multiply. hello, all of you. get organized at voya.com.
6:35 am
welcome back to "squawk box" on cnbc. first in business woorld wide. flirting with a flat line and they still are. it must be august. most major averages would be open just about one point at it hour. stocks to watch, mylan will launch an auto injector at a discount of more than 50% from the brand name product that has been under so much scrutiny. the list price will be $300 and that's for a two-pack. the company, of course, has been under fire for hiking the price of epipens multiple times in the last decade. they plan to launch it in several weeks pending label -- a quick turn around for that company on that product. >> time now for the executive edge. we're talking politics.
6:36 am
let's get to the highlights on the campaign trail over the weekend. ammon, next week is labor day. supposedly, that's an important period in election years. it's also the u.s. open, which is -- there are some good things about early september. it's still summer. you don't really feel like summer is over yet. you got some good things. like maybe the -- is it good that the campaign starts in earnest? i don't know if i can take it. >> the campaign started in earnest months ago. this is typically as you say a slow weekend in august. it's back to school day for my kid. a lot of people not focused on the campaign trail. i don't know where to begin, joe. so many headlines. start with confusion on the campaign trail and over what their position is on immigration, including in the -- here's what reince priebus had to say. >> we're going to build a great wall on the bordered and we're going to institute nationwide
6:37 am
e-verify, stop illegal immigrants from accessing welfare and entitlements and develop an exit/entry. you know what that is. exit/entry system to ensure those who overstay visas that they're quickly removed. >> that was not the reince priebus bite i was hoping to play there. the term of the republican committee was on tv over the weekend saying he wasn't sure what the republican plan is on immigration. we're going to see donald trump on wednesday as you just saw in that sound bite. he's going to come out with a larger speech on immigration. some question about whether he's softening his immigration approach in attempts to reach out to independents and suburban vote who are might be put off by his hard line stance during the primary. where the trump campaign ends up on immigration, key issue into the fall. also there was a sound bite from the former head of barack obama's -- talking about donald trump and his emotional and
6:38 am
psychological temperament. >> basically there's a psychopath running for president. he meets the clinical definition. >> diagnosing people on arrow owe i assume you don't have a degree in psychology. is that fair? we're jumping to conclusions here. this is what gets voters frustrated. >> listen, the grandiose notion of self-worth, pathological, lack of empathy and remorse. >> so the clinical definition of a psychopath, according to the democrats anyway, that's donald trump. meanwhile, mike pence on television as well continuing to hammer away at the clinton foundation saying that the clinton foundation is yet another example of pay to play politics. guys, we also learned that both candidates had begun their preps for the first presidential debate in october. so we'll see where that lands. all of this a big political stew going into the week, guys. >> yes. psychopath the same as a
6:39 am
sociopath, isn't it? >> it is. i've done a lot of research on this, joe. yeah. i mean, look, somebody who doesn't have empathy, scientifically. somebody who doesn't have feelings for other people. >> they look at the way other people respond emotionally to things and that's how you -- they do feel a lot of -- they suffer themselves and think that -- they understand suffering within themselves. >> whether you can psychoanalyze a guy watching him on tv -- >> i know ted bundy was a sociopa sociopath. i know that. >> iman, thank you. i'm going to leave it there. >> safe to do that. >> smart. coming up, the a success story looking to disrupt the pet food industry. the founder of turbo pup will be here next. a quick check of what's happening in europe.
6:40 am
uk is closed. look at everything else. slightly down. we'll be right back. this car is traveling over 200 miles per hour. to win, every millisecond matters. both on the track and thousands of miles away. with the help of at&t, red bull racing can share critical information about every inch of the car from virtually anywhere. brakes are getting warm. confirmed, daniel you need to cool your brakes. understood, brake bias back 2 clicks. giving them the agility to have speed & precision. because no one knows & like at&t.
6:41 am
mapping the oceans. where we explore. protecting biodiversity. everywhere we work. defeating malaria. improving energy efficiency. developing more clean burning natural gas. my job? my job at exxonmobil? turning algae into biofuels. reducing energy poverty in the developing world. making cars go further with less. fueling the global economy. and you thought we just made the gas. ♪ energy lives here.
6:42 am
6:43 am
a startup is taking on the industry. wants to redefine mealtime for -- natural power bar to help dogs refuel. the company recently launching in kroger and petsmart. joining us is christina guerr o guerrero, founder and ceo. appeared on shark tank last year to strike a deal with damon john. now on track to hit a million dollars in sales this year. >> hopefully. fingers crossed. >> how do you decide this is what dogs needed? there weren't enough snacks and you needed to -- >> i'm an avid outdoorsman. i get outdoors a lot. i'm in the back country, hiking. now i'm a mom. i'm always with my dogs. new generation, i grew up, my dogs were stay at home pets. now they're always out with me. what i found when i was out, i
6:44 am
had a real hard time remembering dog food, kind of bringing a bowl, bringing things with me. i wanted something quick and easy and on the go. so it was really important for me to have something healthy when i was out with my dogs that could sustain their energy. >> does a dog know the difference between that and normal potentially cheaper dog food? >> i think my dog loves the bars way more. >> you say it's not a snack. what does that mean? it sounds like a snack. >> actually the pet food industry has certain definitions that differentiate a meal from a snack. so for me, when i made the bars, these bars, i made sure that they met the criteria to be a meal. >> it's like a meal replacement, like a regular human being? >> exactly. but it's healthy. when you're out and about, you really shouldn't be feeding your
6:45 am
dogs treats. i liken it to giving someone a bag of skittles. you want to give them something filling and nutritious for their health. dogs are really interesting. >> you mean skittles aren't good? >> they're good but not for the athlete. >> but you're giving them roast duck and kale? >> this is the new super food snacks. they launched in kroger stores this month. again, you know, i wanted a healthy alternative. not something that's full of sugar, something unhealthy for dogs. you feel good about giving it to your dog. >> can we have joe taste test them? >> no thanks. >> you are a dog owner. i. >> i got three dogs. they gain a little bit of weight. i have a puppy, german shepherd puppy. you can't believe what he eats twice a day. i would rather give him protein because his muscles were growing. do adult dogs, will protein still help maintain weight better than carbs or something? >> actually, a dog burn protein
6:46 am
and fat as main energy source. not like humans. they don't burn carbs first. when we made this, i was thoughtful on it. >> i have a german shepherd mix. >> they're incredible. i have one that's six months old. >> gives you a run for your money. >> 24 hours. it is. >> when you said you're a mom. do you have children? or were you talking about dogs? >> some people are like that. they are. >> the bars went from my backpack to my diaper bag. >> you flew c 130s in the air force. >> that is cool. >> that's incredible. >> wish you must success. >> best of luck, kristina. >> kristina guerrero with turbo pup. narrowing his -- talking
6:47 am
about retaking the cup. looks like it's with him after three consecutive euro wins. i wonder if they know he's got it. >> start getting used to it davis.
6:48 am
6:49 am
6:50 am
the door is now closed on automatic u.s. qualifying for upcoming ryder cup. rickie fowler had a chance to grab an automatic spot yesterday
6:51 am
at the barclays but lost it. he lost it on the double and birdied the next one. u.s. and european teams not completely set. joining us for more on how america can take back the cup davis love iii team captain for u.s. you brought the cup with us, which is cool. thank you for joining us. >> don't let darren clarke know i have it. >> exactly. rickie, yesterday he had to finish better than third. >> he had finish third alone to secure his spot. >> how many more chances? >> two more weeks, three. then we pick the last one before we go to the ryder cup. i tell players you've got another chance. >> you pick them -- >> before fedex event after bmw, then a week off and then the tour championship. bubba came back from the olympics and he was worried. i'm not playing this week, what
6:52 am
do you think? i've got to pick the night before we go. don't worry about it. rickie needs to play fedex and not worry about it. >> the olympic didn't throw a wrench in the timing? there was some scuttle about that. >> rickie was down there two weeks. he missed two pga tournaments where he could have gotten points. >> might be some guys on my team. >> we're trying to win this thing back. >> i'm somewhere between left hand low, right hand low, claw. >> cache you off the list. >> rickie, right? >> rickie, been big part of a lot of teams since cory pavin picked him. i was his assistant. he's great on the team. he had a lot of intangibles other than golf. everybody loves to be around him. we've got a lot of great
6:53 am
players. really anybody who made it to the top 100 deutsche bank is in. somebody in the top 100 could win fedexcup. >> on europe team we've got who? >> they have their nine. tomorrow darren announces his pick. once he picks, then i can start thinking who can i match up. we're one up. >> carried the sign for darren, said she loved him. talked to her the entire time, found out everything about her. >> one of the nicest guys in the game. we're both thrilled we're doing it at the same time, get to spend time together. we've got a little wager who wins. we're going to have a fun trip after ryder cup no matter who wins. >> some quads. >> we have so many that get
6:54 am
along really well, rickie fowler. >> he's not on yet. >> still gets along well with the guys. matt kuchar is not on but he brings a lot to the team. sean o'hair played really well. moore won and played well last week. i could take any four guys in the top 30 and we'd have a great team. >> have you thought long and hard, i'm sure you have, everybody has dissected it over the years, why it's been so difficult for the u.s. to win the ryder cup as of late. >> we've thought long and hard. we want to win so badly we get in our way. rickie didn't make any bogeys, then all of a sudden started making bogeys. started trying to win and beat patrick. hitting for birdies instead of the middle of the green. we try to hard for something we want very badly and get in our own way. >> last time you were captain, that's like watching slow motion train.
6:55 am
>> was that worse than anything that's happened in your own personal career? >> it was. it was tough for me because i know how much the team put into being prepared. they played great friday, saturday, better than any u.s. team that played. >> other guys had something to do with it. dustin rose. >> four ahead. >> poulter. >> almost unbeatable in ryder cup. >> we lost momentum. ryder cup if we lose momentum we panic. we play not to lose earn play to win. easy to say, relax and play, just another term, but it's not. >> do you judge anyone for nothing going down to the olympics? in hindsight, what do you think? >> in hindsight i said what a lot said not sure what happens. when we see matt and sydney kuchar celebrating third place finish on last green and flew home to sea island, hundreds met him, it hit me. this is a big deal. kids that watch that and watch guys win a gold medal and girls, they are going to say, hey, i want to do that, too.
6:56 am
i want to be rickie fowler and go to the swimming and table tennis events. they saw it happen. i think it will elevate olympics next time. >> are you kidding me? i want to go down and win. we have gary claire coming on later. he said in his day he would have gotten in a row boat from south africa. zika, that's like one in 5 million. i live in south africa, something can happen to me every day. >> tiger is an assistant captain. how involved is he going to be? >> very involved. text message at 12:30 last night. what can i do to help. tiger, jim furyk, tom strickland incredibly helpful. says a lot to players these guys are in on it. tiger is coming no matter what. >> how do you carry this thing? >> it has its own box. like the stanley cup, a handle and pretty silver box. it's neat. this the first year the ryder cup trophy tours.
6:57 am
this cup is going to travel around the country and get the golf fans fired up. [ clock ticking ]
6:58 am
6:59 am
time. you only have so much. that's why we want to make sure you won't have to wait on hold. and you won't have to guess when we'll turn up. because after all we should fit into your life. not the other way around.
7:00 am
investors feeling a bit of a fed hangover. >> sounds like somebody has a case of the mondays. >> what you should take away from yellin's speech and how you should be playing the markets as the summer starts to wind down. that's straight ahead. brug pricing fallout. could the controversy surrounding mylan's epipen spell over to big pharma and other drugmakers. is government regulation to blame. we tackled the sector and find out if the blame game will continue. top players, celebrities and businessmen coming together to support a great cause.
7:01 am
grand slam winner gary player will join us himself as the second hour of "squawk box" begins right now. ♪ i'm all right nobody worried about me ♪ >> announcer: live from the beating heart of business, new york city, this is "squawk box." >> welcome back to "squawk box" on cnbc, first in business worldwide. futures this hour flat after what was supposed to be a momentous day friday. a little volatility. at least the dow moved around a little. >> couple hundred points. >> entire month or something. when it was all said and done, it was down like 50. check out europe. europe was in the red on my way in when i looked at it. almost a point on a couple of boards, ftse up. oil trading low. i don't know if that's a problem or not.
7:02 am
i don't know what the correlation is, down 1.3%. here are the currencies, the dollar hit a high, two-week high against the yen earlier. back 102 on the yen, just under 112 on the euro. the pound is hugging that 130, above and below. we had it 132, now 130 post brexit. >> here are headlines. plenty of data on the economic agenda this week. today july personal income, tuesday monthly case-shiller home index and august consumer confidence. wednesday adp employment report chicago pmi, pending home sales. thursday look for revised second quarter productivity. ism manufacturing index comes in as well. on friday we will close out the week before the long weekend with the august employment report. meanwhile mylan announcing generic epipen injector at 50%
7:03 am
the brand name proublg. list price $300 for two-pack of the product. the company under fire for hiking the price of the branded epipens. cnbc will have much more on this story in just a few minutes. faa's new rules for commercial drones go into effect today. pilots must pass air nautical exam before they have to fly but they don't have to get pilot's license, which was a point of context. under rules drones must be under 55 pounds. they can't fly at night or higher than 400 feet and they have to remain in visual contact with the operator. the new rules include limits to hamper arrival of some drone services like packaged delivery which amazon, dominos and others have been seeking. >> i was just thinking of dominoes when you were reading the story. >> are you hungry? >> i'm always hungry. i think i saw something over the weekend about domino's and drones. i was just thinking about it.
7:04 am
>> will there come a time we all have goggles, those things flying around. what if the operator isn't in the range to see the drone. that'sing someday, isn't it? >> delete from the rules because you can't do delivery if you have to stay inside. >> might as well deliver it if you're going to be there. right? the operator, the pepperoni. you like pepperoni? >> thin crust. >> you look like you go for the thin crust. >> you go all in deep dish. >> i like pan pizza. >> i wasn't going to say it. >> walked into it. >> by saying you weren't going to say it is saying it. >> thinking it is the same thing as saying it. >> double deep dish extra cheese. drugmaker roch, molecular
7:05 am
diagnostic test easy to use can allow doctors to quickly detect zika. janet yellen speaking friday signaling a rate hike could come sooner than expected. join us with more on where markets are heading, investments portfolio manager and mike ryan ubs chief investment strategist. do you really think she signaled it will come sooner or set the market up, more of the same, data looked good, at some point we'll do it. >> i think at some point well, i don't know about september. how strong the employment data is, how much we're starting to see price targets of 2%. i certainly think december is the most hikely but i wouldn't rule out september. if we do get a flurry of strong unexpected data, we could well see something in september. >> do you see the fed moving the goalpost, even if we get a
7:06 am
strong employment report we've heard stan fisher say maybe should be 3%, gdp growth, maybe setting our sights elsewhere. what is the fed actually looking at? >> i think what the fed is showing us, by everything they have been doing, how cautious they are doing, looking at data point, airing on the side of caution. i think this. i don't know why they need to hurry. from their perspective rates are gradually moving higher. we all know rates are gradually moving higher. as equity investor i don't know if i care. rates can move higher as long as curve isn't too steep. i think they are showing us the slope of the curve is not going to be that steep. >> i'm sorry. assuming the fed is able to control the curve. there's some question obviously if they will lose control, if they are already -- have they lost control of rates, have all central banks sort of lost control. >> yeah, to some extent, i think that's why for the first time
7:07 am
that i've ever heard them say, but maybe you know differently, they are talking about paying attention to things happening outside of the umbrellas. first time they have ever said that. that's because we're in a much more globally dynamic environment than we've ever been before. so they are thinking about what's gdp in china when they think about whether we raise rates. it is more complicated than it has been. i think that's why they have been so cautious. the u.s. economy in good shape. i think they want wiggle room to have interest rates higher. >> mike, if you need money parked in bonds or recommend money parked in bonds, what's the safest? >> you still need some encome in portfolios. the notion you simply won't have everything rolled into short-term investments because the fed is poised to raise rates, i don't agree with that. physical of all, i think it's a gradual pragmatic rate rise. we'll be at this low in terms of interest rates. fed's ability to control the curve, they can't completely
7:08 am
control the curve. when you own an awful lot of treasuries, that's going to limit mou far the rate back even if we do see interest rates. >> there are really two distinctive side to the stories, whether you think the economy is good, as you say or as joe sitting here earlier said the economy is terrible. it shows you the differing views people have on where really we are. fundamentally different views on where this economy is, it plays into how you think we should invest in the market. >> the markets, i think u.s. economy is in relatively solid shape. not robust growth, the kind of growth we've seen prior but the economy is actually doing okay. what the fed is concerned about is what's happening in the rest of the world. the fed can't unilaterally go out and raise rates when the rest of the world is struggling for positive gdp growth. >> margaret, if you're putting money in u.s. equities which you have recommended putting focus,
7:09 am
where can you get value. the majority of strategists, where ku find -- >> i think that's fair. i would agree. i don't necessarily see overall market as being mispriced but i think there's opportunity in places like biotech, which i realize is not particular popular right now. biotech is really inexpensive. look at selgen, trading at 15 times. even with much more modest pricing assumptions going forward, company still generating double digit earning growth. i think biotech, if you're willing to be patient and look beyond the election, which i think people are so myopically focused on very short-term. look longer term and those are interesting companies. >> we've got to leave it there. margaret, appreciate it. take care. >> latest read on home prices, heading higher faster than expected. now some are worried another housing bubble is in the making.
7:10 am
diana olick joins us now with more. hi. >> ten years ago home prices hit their peak of the housing boom and we all know what happened after that. values dropped for six years by the most in history. but somehow we are almost back to where we were. take a look june marks 50 consecutive months of annual home price appreciation with prices up 33% from that bottom in 2012. a new report from black night financial services put the home prices in june at 265,000. that is within just 1.1% of a new record high. the difference today from a decade ago is that these prices are not being driven by faulty mortgage products that people can't afford. they are driven by a severe lack of supply of homes for sale as well as record low mortgage rates. going locally of the nation's 40 largest cities, 14 have already
7:11 am
seen home prices cross to new highs, austin, boston, dallas, pittsburgh, portland, oregon, san francisco and seattle. only st. louis saw home prices drop annually. apparently there is thankfully a limit. san jose, who has some of the highest home prices in the nation, did fall off its peak an gains in san francisco are shrinking. that's some good news. right, guys? >> i guess so. we'll see later in the week what the data bring for now, diana, thank you. coming up on "squawk box," after a week that saw stocks fall 50% and ceo heather bresch named pharmaceutical industry's latest villain what is next in the epipen saga. what's new? crude prices falling 3.5% since august peak, down 1.5% this morning. here is a look at where we are trading. more on where oil is going when "squawk" comes right back.
7:12 am
so it's indigital. digidustrial. indigenous. shhhh... let's go with digital industrial. for now. digidustrial. yeah. or, digital instrial.
7:13 am
7:14 am
we're back the epipen controversy raising fear level among big pharma levels that price scrutiny will spread across the industry. meg tirrell joins us with more. >> reporter: this is something they have been extremely concerned about. mylan raised epipens
7:15 am
cumulatively over time. i think we have to focus on the news about milan's generic competitor making this announcement essentially that mylan it's self will launch first generic epipen cutting the list price in half to $300 for two-peek. authorized generic identical to the branded product available in the same strengths and make this available over next few weeks. i've been trying to understand what this means this morning. the company doesn't need to seek additional fda approval for authorized generic since they already made the product. importantly it's going to be ab rated. when it's ab rated, a pharmacist can swap it in automatically for products. you go to the doctor, they write epipen on your prescription they give epipen generic which is made by the same company that makes epipen. i've been talking to analysts this morning, thank you for answering e-mails at 6:30 this morning. this is typical to do for a
7:16 am
company to make an authorized generic version of their product to be ready to launch when a generic launches. what's unique is we don't have that mylan launching early. i've been talking to other folks saying it looks like they are cutting the price, generic half as expensive on the face, so seals like maybe they will lose money. actually, if they are rebating so much on the branded epipen and they have cut this price of generic to $300, they actually might be able to make the same amount, maybe more on unit cost of generic if they aren't facing rebate precious. mylan is up. if you look at teva trying to get the generic epipen approved. >> who gets the branded version when they go to the pharmacy? >> it's a great question. i don't know. do you have to say i want the branded epipen to the pharmacist so they write, do not swap, it's
7:17 am
made by the same manufacturer and the same product. it's a very interesting, confusing situation. >> the whole quagmire of the way drugs are biosimilar, biological agents, how they get protection, every country is different. you've got 12 years and extended release. it's not a free market. that's the problem. it's not where competition -- it can't be because of the cost to develop these things are so prohibitive that nothing would be develop if you didn't have patent protection. it's a mess. will you stick around, meg? >> sure. >> we'll solve it right here. let's talk more about the role the fda should or should not play in pricing. joining us former principle deputy commissioner with fda, currently associate dean johns hopkins bloomberg school of health. doctor, it's good to see you. so one thing we need that i can see you feel strongly about, maybe the whole generic process
7:18 am
needs to be maybe revamped or reformed in some way or at least be more transparent. that would be the first step. >> well, the gern aircraft drug market accomplished a tremendous amount, 90% are generics, over a trillion dollars in savings. people expect generics to be there to lower the price of drugs. what's really been shocking over the last few years, it's the generics themselves that have gone up so much in price. people didn't expect to be hit in that direction? >> you make the point that in a perfect world there would be competition and it would simple. we wouldn't have to worry about these things. you need competitors, but you also say there should be limits on pure profiteering. how would that work? who would come you with the limits? how would you decide on what's profiteering and what isn't.
7:19 am
another law? another agency, more regulations written, more red tape for companies to go through to decide how to price their drugs? >> this isn't unique to pharmaceuticals. if there's a hurricane people aren't allowed to jack up the price of gas or jack you the price of water. in some of these circumstances the companies are creating their own hurricane. they are making lifesaving drugs for no reason other than to extract money go up in price by 100 fold or more. that kind of situation people inherently understand is unfair. this isn't a case it cost more to produce or some supply issue. this is a case people decided, hey, people's lives depend on this, let's dramatically increase the price right there. sort of like the surgeon right as you're getting surgery saying, by the way, we're going to take your house for this surgery. >> this wasn't a weather event or hurricane. this was nothing that changed, a
7:20 am
gas crisis, this has been going on the last five, six, seven years they have been doing that. there should have been other companies without a barrier to entry to come in here and do that. epinephrine has been around how many hundred years, that wasn't similar to what you described at all. there should be competition for this. >> you can't snap your fingers and have other people in the market. you are pointing out something very important. ku have both things. you can have companies essentially acting like profiteers on lifesaving medicine but also have the need for more competition. in this case there are some things that fda is starting to do and can continue to do to facilitate competitor products getting on the market. for example, you would put a second competitor in line ahead of the 19th competitor. you've got 18 generics on the market, that 19th isn't as important to the health care system where it's the second competitor. >> the eye of the beholder.
7:21 am
profiteering is the eye of the beholder. who is beholder. a drug that cost $300,000, every democratic person in congress would have called that profiteering so genzyme wouldn't charge this. if congress was the eye of the beholder, everybody with that disease wouldn't have a drug to take. >> i'm saying something different. i'm not talking about goshet. >> who decides on profiteering, congress? >> i'm talking about new drugs. nothing changed but cost went up 100 fold fl people know that's unfair. attorney general of maryland has written it would not be hard to apply those type of profiteering laws that work for gasoline and wat
7:22 am
water, nothing different. not r&d, drugs on the market for years very low cost then going up 100, 200 fold, something like that, people know is wrong. >> doctor, aren't we even having this conversation in some respects because the agency you used to be an official with is too slow approving drugs, approving generics. there could have been a generic version of epipen on the market but the fda hasn't approved it. at the end of the day, isn't that the problem? >> i don't think that's fair because i think that the fda made a very important point with these injectors, which is a different issue. if a pharmacist is going to substitute an injector, it has to work the same way. if a coy comes in with a product that doesn't work the same way, that's very different for families. i mean, you wouldn't want to be trained to use one device and pick up a different device. there's very the room for error
7:23 am
with injector. i think to say fda, it's almost the same, go ahead and approve it isn't fair to families whose child's life is on the line. >> doctor, quickly, we're almost out of time. you mentioned this issue of again arab drugs prices spiking. what in the near term to not go through the approval process when you have a spike of a drug price? >> i think it's important for policy to try to deter that business strategy, the business strategy of saying we're just going to take something already on the market and jack up the price because we can. there's a couple of ways to deter it, accelerate applications, which they are doing. in some circumstances they can authorize importation temporarily of similar products from europe, for example, if the drug is really priced out of reach here. i don't think that's a great thing.
7:24 am
i think the fact fda would do it could deter the business practice, totally unfair, produces no value except essentially for a profiteer. >> i don't know what you'd use, whether you'd use margins. i don't know how you decide. if you use margins everything intel sells should be -- they are profiteering, they get 60% margins. fairness -- whenever you use fairness in terms of how you're doing things, that's in the high of the beholder. you can see the way this has been demagogued, this entire issue. if it turns around and ends up causing price controls and loose innovation, we're going to look back and say there shouldn't have been this demagogue fl anyway, doctor, thanks for your time and thanks for being with us. >> thanks for having me. >> meg up as well. coming up, controversy continues -- >> you took both sides. you were on my side for that. >> i told you i disagree with some of your arguments.
7:25 am
>> you know what that's called, psychopath. you don't believe either side. os connected. businesses count on communication, and communication counts on centurylink.
7:26 am
7:27 am
coming up, a fund manager whose bread and butter is tech. finding value in financials, paul meeks joins us to discuss
7:28 am
his latest stock picks. as we head to break, u.s. equity futures, somewhat muted gains at least and applied. back after this. people get anxious and my office gets flooded with calls. so many things cano wrong. it's myorst nightmare. ery seco that power is out, my city's at risk. siemens digital grid manages d reroutes power, so service can be restored within seconds. priority number one is keeping those lights on. it takes ingenuity to defeat the nsters that live in the dark.
7:29 am
7:30 am
7:31 am
among stories front and center mylan announcing it will launch generic epipen injector at 50% of its brand name. list price will be $300 for two-pack. the company has been under fire for hiking the price of ep pens. mylan expects to launch the product in several weeks pending completion of labeling revisions. carl icahn bought 2 million shares of herbalife friday. the billionaire investor may have been interested in exiting part of his position early in august. jeffries and ubs working independently for icahn's massive stik in the supplement company but nothing materialized. in a statement he denies he attempted to sell his stakes in an interview right here on cnbc
7:32 am
that he had been offered some of icahn's shares. icahn didn't dispute he considered selling but palaced him. it amazes me that a guy who hasn't any knowledge of my internal invest think thinking believes he is in a position to say that. some scrutiny from republican lawmakers, leaders and voters, the issue deporting undocumented immigrants. his campaign saying today, quote, trump has been completely consistent on his plans. again, that speech happens on wednesday. >> time now -- >> that music was like -- sort of builds up a little bit. >> you know about judge wapner. you know what's going on with him? >> i don't. >> alive or dead? >> alive. >> how old. >> 90. >> six. >> 96.
7:33 am
>> 96. >> is that right? >> november 15th, 1915. he's still going strong. he's retired. judge -- >> i know what it is. >> you know what it is. >> i just have wondered because that music -- >> clearly kayla has never watched -- >> i know the music. >> by now. >> still god bless him, a great programmer, still living off survivor, which is embarrassing. latest survivor again. genex versus millennials, is that you? >> i don't even know who gen ex is. >> how do they survive? cell phones? can't snapchat on the island what do they do?
7:34 am
start twitching and go through full withdrawal on the island. >> watch and find out. >> what's working, talk to investors about what's playing well in their portfolios. let's bring in tech investor paul meeks. tech has obviously been great this year. does it continue to be so? >> actually right now i see more opportunities to short some tech names because the tech sector poor at the beginning of the year but on fire last couple of weeks. i had some great opportunities, for example, four tech stocks in my portfolio, tech guru, no surprise. right now i think they are all fully valued and then some. >> what would you short? >> there is a company i actually wrote an article about for cnbc, a company called power solutions, psix. i worry about power solutions and i also worry about that, whenever you see a company delay quarter financials, that's a
7:35 am
very bad sign. both companies have. >> are you short both those names? >> not hane but power solutions. >> what works, old tech, microsoft, cisco, et cetera, and so-called fangs had a nice comeback in their own right. how do you view both distinct groups? >> the way i look at it is you do not want to have client server hardware oriented names from the '80s and '90s. the only one i really like because i think they have had a nice metamorphosis under their ceo is microsoft. all other ones you want to avoid. not necessarily today but any reasonable dip in the cloud super powers, which is microsoft, google, amazon -- >> sales force? >> salesforce.com because they are dominant in software and service. >> no ibm. >> no. ibm has put together a cloud
7:36 am
franchise through kind of patchwork with acquisitions. i'm not impressed with them. of course that company continues to grow or actually shrink on a quarterly basis every time they report for the last two or three years. >> what about these fang stock, facebooks of the world. >> i like facebook very much. the way i look at it, facebook still has a lot of runway because they haven't exploited fully and mondetized video. this is a company profit margin two or three x the company, last year's revenues 60%. i think plenty of runway. when i say runway, target price 30% higher. >> that could be one of those stocks. i know it's not lumped into your old '80s tech, but obviously that stock had a great run. some question how much better can it get? >> i actually think it can get better, unexploited, at least as
7:37 am
of now, with video and messaging. >> what about apple? do you own it now? >> i've had apple in the past. the problem with apple, i think it's a value stock now. right? it has a yield s&p 500 plus. the problem as we know, 60 to 70% of revenues with the iphone greater proportion of operating income, you have this lull between the generations of the seven to the eight. >> maybe slower, undeniably so. excuse me, that doesn't mean that the story is over. >> no, no, no. i actually think if the stock gets down to 89, which was its low, it might be a buy. i don't think you have it as an ultimate growth stock consistently anymore. it's a value stock, buy it on dips. it has a nice protection on the bottom because it generates about $1 billion of free cash flow per week.
7:38 am
>> who hits trillion dollar mark first? amazon, google or apple? >> i think apple may get there first temporarily speaking the ramp of their next phone. >> got to be $200. >> could be. >> not buying it until '89. not got at 200, i'm waiting for 89. >> you asked me which one could. i think it has the best chance. in the long-term i'm not so bullish on it. >> as she said, google. other people are changeing to amazon. how do you ever discount that? >> the nice thing about amazon, i live in seattle, i have a good read on it. everybody focuses on amazon web services, totally dominating as a service space. on the other hand at long last, remember this is a company that went public in the late '90s, even their etailing business showing operating leverage and market expansion. remember, we've been waiting a
7:39 am
decade or more with that. >> facebook, aramco. >> that's a safe bet. >> perfect segue actually. >> it is. oil prices falling, rising output from iraq, joining us where prices could be headed next matt smith clipper data commodity research. what i can tell when people talk b to you about what you think, matt. the rally, people buying into it, jawboning, saudis continue to go for market share? >> exactly. we've got saudi basically last month they hit their record in terms of production. we track their crude loadings. they are at 7.5 million barrels a day in terms of exports. up over 1 million barrels a day since early last year. they are putting more oil onto the market. we're seeing more oil on the market from iran to iraq.
7:40 am
the rhetoric and the actual actions are very different. >> i can't use regular usually. i bought some regular in a rental car, $2.15. i can't help but think that felt really good when i bought it. it has to feel good to a lot of people. >> good times. $2.20 on the national average. we're coming up to labor day. july 4th weekend was the most people driving in a decade. we're likely to see that this weekend as well. demand is relatively strong but price is relatively weak as well. >> inventories up 8.5% on gas year over year. >> right. that's correct, yeah. >> so the $47 number, you think the new range is $40 to $50? we're going to stay there for how long? >> into next year. we're not going to start to move higher until we see the
7:41 am
production biting from these projects that are not coming online. until that point, we're going to be seeing probably 200 moving average de los $40 at providing some support. once we get up to around 50, you're saying recounts ticking high. you're seeing permian basing a lot of investment into it. there is production response in the u.s. at the same time you have saudis, irans, iraqs putting oil onto the market. the band of 40 to 50 is good. >> what does iran want its market share to be? >> as much as it possibly can be. >> what's possible? >> they are stalling out, i believe. they got up to 2.5 million a day in exports and they are stuck there. that's where they got to in may. their production 3.6 million barrels a day but it's been there for a couple months now. i think they really want to get up to 4. there's no reason to talk about a production freeze when they really are targeting production 10% higher than where it is now.
7:42 am
>> you think the september conversation in algeria will just result in nothing? >> result in nothing but going to be a very long four weeks getting there. >> all right. thank you. >> thanks. up next gary player ready to tee off his annual gold invitation. dom chu joins us with preview. dom. >> a great day for golf. all about charities this event supports. gary player invitation in ann arbor in bedford hills. we'll be back with the black knight himself to talk about the health of the game of golf. we'll be right back. a shiny oor x,o? not if you just put the finishing touches on your test masterpiece. timi's important. comcast business knows that. that's why you can schedule an installation at a time that works for you. even late night, or on the weend, if that's what you need. because you have enough to worry about.
7:43 am
i did not see that coming. n't deal with disruptions. get better internet installed on your schedule. comcast business. built for business.
7:44 am
7:45 am
celebrity business leaders and golfers coming together for invitation. >> am i okay? >> what are you, dom? dom is there. he joins us with a celebrity, a golf pro or a business leader. they are going to throw you out of there. what are you closest -- i don't even know what you're closest to? >> what he hasn't told you, he's played nine holes already and
7:46 am
nine holes afterwards and you think he's going to a meeting. >> joe, there are, like you said, a lot of folks converging in westchester, new york, for this particular event gary player investational, u.s. it's a huge day for charities. i want to start by going there with gary player. first of all, thank you for joining us on cnbc. >> it's a pleasure. to be here at ann arbor, it's a beautiful golf course, beautiful part of the united states. events taking place in six different companies. so blessed to having a phenomenal sponsor located in germany, united states and europe. we played this event at wentworth in england a few weeks ago. we had 15 major champions playing in the event. the thing that's really just added luster to the event we've got all these lady pros. they are phenomenal at looking after client.
7:47 am
service in any business is such a charitable. >> how big is this and what kind of charities will it benefit throughout the world. do you think charitable giving is still helping? >> absolutely. the people -- they are changing millions of people's lives, so gratifies for me, having been poor and struggled as a kid. golf has never fwn more healthy, professional playing for prize money. olympic games made a massive difference. i spent two weeks there. i stayed in the village for two and a half days, dined with 11,000 athletes. went to the gym, same with convenieseren serena, all the great athletes, doesn't matter who it is, phenomenal, the opening ceremony. but the big thing, the golf was of such a high standard, men and women. the crowds. brazil is not exactly a golfing
7:48 am
country. there are young kids there. it was so gratifying and exciting to see. what's going to happen now in japan? they have 25, 30,000 people there every single day. >> now, with the olympics, do you think it was enough, this particular olympics, first time they have had it inside early 1900s, enough to promote more the game of golf within the world realm of sports? >> very much so. we've already had messages from people in smaller countries saying it's made such a difference already the excitement. 3.5 billion people see it. it the biggest show on earth, never mind biggest sporting event with all records broken, phelps, usain bolt. we had a young man from south africa meet michael johnson's record, a 77-year-old lady who coaches him. >> it's amazing. gary, i know the guys back in the studio, joe in particular has a question for you guys as well. >> questions and comments. gary, mr. player, you actually
7:49 am
were on. you said you would have gotten in a row boat from south africa as a player and you would have rowed to play in the olympics. we were talking in light of some of the guys that didn't go. i think they are going to be there next time. knowing how competitive those guys are, they were watching going -- watching kuch get a bronze, i thought i was going to start crying when he got the bronze. it was unbelievable. >> having been a professional 63 years and traveled more than any human being ever, i was choking as well. i was captain of the team. i would have given -- in fact, i would have got in a row boat and rowed over just to participate. i must tell you this, the players that didn't play, some of them made a very bad decision but they would have missed, quite honestly the standard of play was so high in such great a field, such great attendance, such enthusiasm and the media
7:50 am
coverage was phenomenal. in the end, the most important thing the game changed our lives. remember, wemont be preordained and think we're entitled to make this money, entitled to be important because we're not. we're just servants of the lord doing a job and work on this earth. >> i know joe wants to ask another question. the fact that rory didn't go, i bring him up because he specifically said he did not think that his role was to grow the game of golf. he's there to win tournaments, win majors. what's your reaction to a comment like that? >> well, first of all, he's a very nice young man, a very young man. he's playing in the open and focused on trying to win the open championship. we must not be too judgmental in life. he has subsequently said he's sorry and made a mistake. i don't know of anybody who doesn't make a mistake in life. we must go ahead and forget about it.
7:51 am
i'm sure next time he'll participate and be a great addition to the field. >> gary, that might be because of the golf god's or olympic gold gods put a hex on his putting stroke. >> too nice man for that. >> i can't even watch it. you know, i was thinking about you and your career and everything else and you and jack and arne and i get a little bit -- not sad but you three guys, i don't know what about the sport breeds guys like you, but it's, you know, incredible. i know arne can't hit the ball -- i don't know if he plays at all anymore but watching you guys, that's one of the greatest things at augusta to watch you guys every year. >> well, thank you very much for that compliment. i phoned arnold yesterday. he's a very dear friend.
7:52 am
we traveled entire world promoting the game of golf, not asking for these crazy sums of money. one of the things that does perturb me about golf managers are asking for too big a fees and being unreasonable not only in golf but all sports. we've got to be careful that doesn't burst the bubble. sponsors will go so far and no further. get a fee butmo monmon monmon m not be greedy. >> when is the last time you didn't shoot your age. maybe 15 years since you debate shoot your age. give me what you did this morning, your workout regimen, how many sit-ups, how many push-ups? >> i never, ever have a round ever that i don't beat my age by at least seven shots. average i beat an average by 10 shots. yesterday i beat by seven shots in nine holes.
7:53 am
the day before i beat eight shots in nine holes. objectestly i've been playing so well. my workout, if i could only go on my hands and knees and say to this great country and people, exercise, it's the answer to health. i have so much energy. i'm nearly 81 and i've traveled the world extensively. keep exercising. this morning i did -- yesterday, last night 1300 crunches, treadmill, pushed 250 pounds with my legs and everything else. the big secret -- this the secret. you don't put gas in your career when you park at night. small dinners, good breakfast, good lunch but eat like a bird -- not a vulture, a little bird at night. >> guys, i'm going to take all that advice to heart. having played with him in this event last year he can shoot definitely better than his age. thank you for joining us on "squawk box."
tv-commercial
7:54 am
we appreciate it. >> unreal. >> 1300 sit-ups. >> i got out of bed, so i only have 1299 to go. >> did 13. >> did one. >> carlyle could leave the hedge fund industry. that story and stocks to watch next. [ clock ticking ]
7:55 am
7:56 am
time. you only have so much. that's why we want to make sure you won't have to wait on hold. and you won't have to guess when we'll turn up. because after all we should fit into your life. not the other way around. coming up, author, political consultant peter schweitzer joins us at the top of the hour to talk about the run for the white house. futures at this hour pretty flat but all green. ught i was cry to open a hotel here.
7:57 am
everne said it's so hard to be a musician, but i can't imagine doing anything else. the neighborhood is really changing. i'm always hopping on the train, running all overortland. i have to go wherever the work is. trains with innovave emens technology helpeep cities moving, so neighbooods and businesses can prosper. i'm booked solid for weeks. it tak ienuiui t make it in the big city. i'm booked solid for weeks. mapping the oceans. whe we expre. protecting biodiversity. erywhere we work. defeating malaria. improving energy efficiency. developing more clean burning natural gas. my job my job at exxonmil? turning algae into bioel reducing energy poverty in the developing world. makingars go further with less. fueling the global econo.. d you thought we just made the gas. ♪ energy lives here.
7:58 am
what powers the digital world? coicatn. like centurylink's broadband network that gives 3500ans cutting edge game experience. or the networkhat keeps a leading hotel chain's guests connected at work, and at play. or the it platform that powe millns oecards every day fobusisses count ont counication, andanies. mmunication counts on centurylink.
7:59 am
new this morning, an about face for mylan, pharma launching generic version of epipen
8:00 am
following the price hike controversy. >> move over boomers. a new report that reveals unexpected places seniors are turning for income. >> the race to space is on. we take a look at private companies looking to go out of this world. the final hour of "squawk box" begins right now. ♪ this is ground control >> announcer: live from the most powerful city in the world, new york, this is "squawk box." >> welcome back to "squawk box" here on cnbc, first in business worldwide. i'm joe kernen with kaley and scott. less than 90 minutes away from opening bell. the futures if you haven't been paying attention dow up 5 points, 4.5 points, s&p up, too, nasdaq up 136. if we just left it like that for three hours, i don't know if anyone would really notice. it's august, premarket, it's not
8:01 am
a lot. >> do you think it's a little bit surprising after friday, after all the volatility. >> maybe a little follow-through. >> see what the data at 8:30 brings because those are some of the feds key inflation gauges. that could move the needle one way or another. we get that data in 30 minutes time. among today's stories we're watching mylan announcing it will launch epipen auto injector at a discount of 50% from the brand name product. the list price $300 for two-pack. the company has been under fire for hiking ep pens. meg tierel will join us with more on this in a few minutes. roch says fda has given emergency approval. it's easy to use, can allow doctors to quickly detect the virus. we are, as i said, 30 minutes away from july personal income and spending data first reports
8:02 am
leading up to friday's jobs data. now to politics. donald trump looking to clarify his stance on illegal immigration. gop nominee announcing he will give a major speech on the topic wednesday in arizona. >> new questions raised around clinton foundation's alleged pay to pay dealings. while hillary clinton was secretary of state. joining us again peter on a few weeks ago, peter schweitzer author of the book, executive producer of the film "clinton cash." good to have you back. a lot more has come to light in the last couple of weeks. i've been looking more closely at the details of the book. some of the narrative of what happened around it. i go back to the stephanopoulos interview and i kind of see what he was saying, because the clintons are both lawyers. they are so smart that maybe the reason they are above the law is because they always stay like a
8:03 am
millimeter above what you can actually prove. stephanopoulos, god knows what he was thinking but he was right to say that to you, that in the entire book it's so damming and smells so bad and so obvious what was going on but there's nothing there that will stick. is there? >> well, i think if the hope that clinton critics had that there's an e-mail out there that says i will do this for you in exchange for that money, that sort of e-mail is not going to exist. the clintons are too smart to put things in writing in that regard. that said, and i responded in this way to george stephanopoulos at the time. the expectation me as a journalist, reporter, is going to prove a crime is committed is i think a ridiculous standards. what i encourage people to do is
8:04 am
look at recent prosecutions for prosecutions in the united states, former governor is alabama, the case involving former governor of virginia, which the supreme court has said needs to be retried. senator menendez in new jersey. in none of those cases do you have a smoking gun or quid pro quo. it's a misnomer when stephanopoulos say you have to show quid pro quo, that certainly hasn't been the case in recent political corruption cases. >> peter, it's unique. most presidents, they get done and their influence slowly wanes as you go ahead in time. that didn't happen this time. suddenly his wife is a senator. suddenly secretary of state, now she's president -- his price through nothing that they -- i'm not saying it was deliberate but it went up. one interesting thing that
8:05 am
occurred to me. we've got a politician in new york who went to lunch and he sent his guys out to get him lunch. they came back, gave him lunch, and then he billed the taxpayers to reimburse these guys. it's like $6,000. this guy is in a heap of trouble. he's in a heap of trouble for doing it. bill became an honorary chairman of this laureate university. in four or five years made $17 million personally. >> yeah. yeah. >> no one cares. no one is on this. no one cares. >> well, i might disagree with you a little bit no one cares. i agree with you that it has not got the attention it deserves. you're exactly right. the level of sophistication the clintons operate is at a very high level. still, if you're trading favors for money, it is still criminal
8:06 am
regardless of under what guise you do it. i think speaking fees are a huge problem for the clintons. you're quite right. every ex president from eisenhower to george w. bush has hit the lecture circuit. every single one over time saw speaking fees go down. in the case of bill clinton he's getting 150 to $200,000 per speech, which is a lot of money. when his wife becomes secretary of state, literally overnight, those from overseas speaking opportunities sky rockets. it triples overnight. places like nigeria, russia, who had not sponsored a speech before are lining up to pay these speeches. that's something that deserves investigation. one can argue it wasn't intentional on the place of the clintons. that doesn't matter. clintons have been called a lot of things by friends and opponents, naive isn't one of them. they know exactly what's doing on. that's why i called for independent counsel to
8:07 am
investigate these matters so we can get to the bottom of it. >> peter, if they were in the private sector, i would say these people are the greatest business people in the world. you couldn't get contributions from foreign entities, that's something we never allowed, you can't do that. with a foundation you k you usually don't have a philanthropic organization doing public works, acting like a public company. suddenly bill clinton had the stated intention of combining the private sector with uranium companies or haitian construction companies. everything they did was pure genius, but i just feel like the american public has been played and government has kind of been used to sort of line the pockets of politicians, which is not why they are supposed to be there. >> i agree with you. look, i've said this. this is not just about the clintons. this is a widespread problem. i wrote a book a couple of years ago, throw them all out about insider trading on the stock
8:08 am
market by politicians. the book came out. we did a story on "60 minutes." congress and president obama signed this great bill to stock act, which eight months later they basically gutted in the dark of night. this is not just unique to the clintons. what is unique to the clintons, which is precisely what you mentioned earlier, foreign money. we know business, labor unions, et cetera, donate to campaigns and candidates because they want access, favors, but it's been an american game. foreign entities can't. with the foundation that's changed, oligarchs in nigeria making massive pledges, millions of dollars to the clinton foundation. >> and paying him to give a speech for $650,000. >> that's right. i think if we're worried about a pac contribution of $10,000 from an american company gaining access, we darn well better be
8:09 am
concerned about access that millions of dollars are getting a foreign oligarch to our pretty cal leaders. >> peter, what's the culpability you would assign to the state department in this? because after hillary clinton became secretary of state, they were supposed to clear all outside foreign donations with the state department. did they just not do that or did the state department turn a blind eye? >> no, that's a great question. i think the state department by and large worked with what information it was given. the problem is the clinton foundation for one reason or another, and we can speculate, i think it was very much intentional, didn't share all that information with the state department. they couldn't act on it. consider a very basic thing, barack obama in his wyss doom when hillary clinton was appointed secretary of state says you can do this but you've got to agree to a couple of things. one is complete transparency. you need to give us the names of all donors to the clinton foundation on an annual basis. we now know they didn't do that.
8:10 am
there's more than 1,000 donors overseas they have not revealed. what can the state department do if they are not given that information. so that's very, very troubling. >> is there a level of transparency that would be suitable for the foundation going forward or do you agree with calls from donald trump and others that the only way that this would be acceptable is to shut the foundation down all the together? >> i think you need to shut the foundation down. i think we need to have legislation going forward that prevents this from happening in the future with anyone else. i just don't think it's appropriate whether you're hillary clinton as secretary of state or whether you're somebody else's secretary of defense to have a private foundation where you're taking foreign money or a member of congress for that matter. >> while i have you here, we may need to have you back, i don't know, on retainer. you're not going to be on george's show again. you don't need to leave your phone open for that. things keep coming up. now we've got a lot more stuff is going to hit in september or
8:11 am
october, whenever it is. we now know why the private server was so important, obviously. we know why -- what's a bleach thing called, what is that called? bleach -- like a digital shredder, some digital program. do you think there's something there -- i just don't think there is, no matter where it is. i just think they are too smart. i don't think there's any way you can see a quid pro quo clearly because they are both lawyers. >> you're not going to see a quid pro quo because they don't function that way. but i've seen e-mails that haven't been released that are coming out. you've got two groups litigating to get these released for years. you're going to see more e-mails about high access for clinton foundation board members when it comes to contracts involving haitian reconstruction and other entities. you're going to clearly see if you gave money or were connected to the clinton foundation you got access and favors.
8:12 am
whether it involves bill or hillary clinton you're not going to see that in the e-mails but i think the evidence will be very damming. >> you're pretty nice to the other people in media. you say there has been an actual effort by the "times" and "washington post." i don't know. we had a couple "washington post" guys on and they broke the story that trump doesn't read that much. i'm not sure that they are on this case yet. maybe. hope springs eternal. peter, thank you. hope to see you again at some point. >> s&p up more than 6% so far this year. we're going to tell you what to expect from the bull and how much the market owes investors. "squawk box" will be right back. ♪
8:13 am
amazing sleep stays with you all day and all night. sleep number beds with sleepiq technology give you the knowledge to
8:14 am
adjust forhe best sleep ever. the time is now for the biggest sale othe year, where all beds are on sale! save 50% on the labor day limited edition bed. knowetter sleep. only at a sleep number store.
8:15 am
s&p 500 just 1% away from its record high. mike santoli with what investors expect. >> recognize how good we've had it until relatively recently. past five years, up 16% a year since 2011, late 2011, euro debt crisis, mini bear market we had.
8:16 am
16% a year for s&p 500 including dividends. i think what's more striking. if you had average retirement of 60% stocks, 40% bonds, that's actually had one of its best five-year stretches in history of the bond market did not sell off, stayed strong. you've really gotten paid just for staying in the market at all. of course that result in the stock market that by most statistical measures looked like it's pushing up against overvalued stake. trailing pe on stock exchange based on operating earnings pushing 20. that's the kind of cautionary point that says, look, maybe this market doesn't owe us very much. then you can dial it back and say in some respects it's still a young bull market. we've only started making new highs. this only acted like a bull market arguably in 2013. that's when you first made a new high for this cycle. also relatively modest returns for the decade. 7% for s&p going back 10 years. usually at the end of a strong
8:17 am
bull market, that trailing two-year number is a good deal higher. as we know bull markets overshoot to the upside. therefore maybe not valuation ceiling earnings growth coming back likely in the second half of the year. it seems as if there's two frames you can look at this market. one says keep your expectations modest and maybe you'll be surprised at the upside. >> the strategist in the last several years have gotten the market almost flat wrong. this year the majority of them have their annual target 2180. should we believe them this time? >> i don't know if you want to believe them. what you take from that generally expectations have been relatively muted. people came in not expecting great things. everyone was surprised by the first six weeks of the year when we went down 15% or something. i think buying it and saying at new highs, therefore we want to extrapolate from there. i think it's net net a good thing the strategists are not chasing around and trying to
8:18 am
outdo each other. >> if murphy's law comes true and we don't -- instead of going above stall speed and the global economy getting better, if it actually does stay where it is or even slow down, rates aren't going up. >> that's right. no, the rate piece of it is crucial right now. it would at least be kind of a gut check for interest rate sensitive areas if rates started to really get a lift. if not, what's really going to change this formula that's worked for a while. >> did they had a glide path to 4%? they never said that seriously, did they? i can't see a glide path to 1% with these guys. >> i think 1% is not that big a hurdle. >> september? >> september. >> november. >> oncould be november or december. >> with the election probably good things. >> that's the thing. i think the market is unwilling to begin to really price in december even if most people think it, it's a long time in fed time between now and december because we've seen how
8:19 am
much that outlook has hanged in two or three months. >> cypress, the island could have a hiccup in gdp. anything can happen. >> if you get a good number friday, i think the market is at least going to have to start. >> consumer in -- that's something janet watches. >> it's data and they are dependent on it. >> all data matters. >> it does. >> that was kayla. >> i already did. >> did you thank him? was it a sincere thank you? >> we'll do it again, thank you, mike. >> mylan launching generic version of epipen. >> that was sincere. >> everything comes out -- following backlash over the company's pricing target. more when we come back an joining taos explain. utaos expl. . . . . . . . . .
8:20 am
8:21 am
8:22 am
welcome back to "squawk box," mylan announcing this morning it will launch generic epipens at 50% discount. more on the story you've been following from the get go. >> that's right. amid the outcry over the rising cost of epipen, people said what if we have competition, that would lower the price. lo and behold we have competition and it's coming from mylan itselfitself.
8:23 am
the company announcing it will make it available for $300 for two-pack, half the price of branded pen, identical to the product and going to launch in a couple weeks. here is what you need to know about an authorized generic. this isn't typical for a company to do when they are about to face generic competition they ondo often come out with authorized generic. they don't need fda to do this. this is so identical it could be swapped in by pharmacist when your doctor writes epipen on your prescription. now, people are starting to question why would they do this now? they don't have the generic competitor, further response to outcry. mylan ceo heather bresch saying it's because of the complexity and opaqueness of branded pharm supply chain and shifting of cost as a result of high deductible plans. offering an additional alternative was the best option. again, pointing the finger at
8:24 am
the middleman here. analysts are scrambling to figure out what the impact will be. mylan stock rising this morning. teva has been trying to get a generic competitor to market is falling slightly in the premarket. bernstein coming out with, while this measure combined with last week assistance to patients will probably impact revenue for epipens by 25%. but the reason you may see the stock reacting positively right now is this just takes epipen out of the stock. it relieves pressure, hopefully for mylan gets rid of the controversy. >> kayla had the best question earlier. who is to determine which one you get when you need it? >> who would want the more expensive one now? >> this is a great question, the psychology of brand versus generic. when it's identical product made
8:25 am
by manufacturer, who would want $600 versus $300 authorized identical version. when your doctor writes a prescription for epipen when this becomes available, your pharmacist will be able to swap in generic epipen. that's determined by insurance plan, pharmacy benefit plan whether you get generic swapped in. if you demand to have the branded epipen, you can ask your doctor to write that on your prescription. >> our friend had an article about this. there's a pot of money for health care that's there. it's there either way. everybody is just jockeying to try to get a piece. i could see if someone wanted a more experiencive version and stick it to medicaid or insurance company they are not involved in the price decision. >> if medicaid or insurance company going to pick up the cost. >> higher co-pay, might make more sense for generic. all this crazy game and how to play it depending on who is actually going to pay for it.
8:26 am
>> does it take away incentive for sanofi or teva pursuing another generic if there's already another one on the market? >> it's an important question. perhaps this helps mylan get ownership of the generic market before teva comes along. they had the agreement teva could launch in 2015 but it got rejected by fda. whether they continue at the same speed is a good question. also raises the note while sanofi continues partnership on that, people working on it may bring it back to market, too. >> what role, we had the doctor on at jobs hopkins, what role does epi play in this conversation. some critics say slow to approve drugs, did not approve teva generic. >> it's a great question. fda involved in broader echo
8:27 am
system of big backlog of generic drugs. maybe they need to have better priorities, reordered priorities in terms of making sure there aren't shortages or lack of competition. in this case we don't know why teva wasn't approved. only certain deficiencies cited. we don't know if that's fda being slow or whether teva's generic wasn't good enough. >> okay, thanks. >> thanks, guys. coming up on-"squawk box" minutes away from breaking economic news july personal spending and income. we'll be right back. your monecd multiply. hello, all of you. get organized at voya.com.
8:28 am
8:29 am
8:30 am
welcome back to "squawk box" f news. getting july read on income and spending. on the income side, good number, up .4 exactly as expected and we gained a tenth on last month. june originally .2, now .4. spending side as expected up .3 and we gained a tenth up from .3 to .4. this data isn't bad. we always like to see income driven up. since we're consumption-driven economy spending important, too.
8:31 am
deflator unchange. personal real spending up .3. if we go through core personal consumption expenditure month over month up .1. core pc up 1.6. now maybe the fed likes to look at that more than the fact the cpi core, two for nine, ten months in a row. doesn't matter what your metric is. if they get the growth right, get the pricing they want and more. back to you. >> rick, thanks so much. a new research report by jpmorgan chase institute has found that 1% of u.s. senior citizens, about 400,000 seniors are now participating in the gig economy, working for companies like uber and lyft. while the extra money the trend has a downside. diana ferrell, ceo of jpmorgan chase institute. good to see you that phones joining us. >> thanks for having me back. >> very interesting trend, maybe
8:32 am
participating in the gig economy than we expected. >> i think that's right. we've had across all age groups, we have some 3% of adults participated in the gig economy. even among seniors, 1%, 400,000 seniors are either performing tasks on the gig economy or selling products, renting rooms in their house. that's a pretty meaningful number in its own right but growing at a pretty fast rate. >> you say they are earning in your word nontrivial amounts of money. ku characterize it and give usa sense of what kind of dollars we're talking about? >> traditionally seniors have earned most of their income from social security or other annuities that come through. that's been the majority of their income. today they are earning as much as 30%. for those that participated in the gig economy as much as 30% of their income is coming from these platforms.
8:33 am
that's quite meaningful. for the rest of the young people who participate even more than seniors do, by and lashlg they only have about 25% of their income coming from the economy. it's a meaningful part, a growing part, and it's a good thing in the sense they are able to rely on this income, more spending power. but it does have a bit of a shadow to it because social security and other annuities by and large are very stable forms of income. once you start introducing more labor income as younger people tend to have, seniors are starting to see volatility income characterized for most people. that's a new phenomenon, opportunities to help seniors manage that volatility even as they have higher income because they now are participating in the gig economy. >> help me understand why this is happening. are seniors spending more so they need to keep up with the pace of their lifestyle while also saving less just because savers, we all know what's
8:34 am
happened to savers under this low interest rate environment we've been in for the last eight or nine years? >> well, it's a bit of a paradox. i would say first answer to why is this happening, we have older people, 10,000 baby boomers turning 65 every year. these days that's a pretty healthy population. they want to work, want to stay engaged. maybe not in a fulltime capacity, not in a traditional job but this offers them opportunity to participate in society actively on their own terms and only as much as they want. that's part of the answer. i think the other part, there's a lot of economic anxiety around retirement, around the future. so despite the fact we see seniors earning more income on the economy, on the online economy, they are not spending more. they are actually spending at a slower rate than they have been spending in the past. and in large part that's probably because they are starting to think about needing to plan for retirement.
8:35 am
there have baseball other factors that probably have contributed to the slowdown. as you know in the last year social security has not received the cost of living increases it has in the past. people see that as a concern and therefore less willing to spend. seniors did not get the same wind in their sails from lower gas prices because by and large they don't spend as much on gas. they don't get that boost other age groups got to a high degree. in general the stock market hasn't done as well in the past five years. that tends to slow down spending for those people who have stock in their portfolio. all these things are interesting because you do see more participation, more income but not necessarily more spending associated for people over 65. >> you do say income among this group can be more volatile which averages 20% month to month. ku explain that? >> sure.
8:36 am
as i mentioned, most people, young people, adults in general, most of their income comes from labor. so you have high degrees of volatility that come from different hours work, bonuses at the end of the year, different deductions. most people who rely primarily on labor income have higher levels of volatility. traditionally older people have had lower volatility because most of their income is not from labor, it's from more stable sources like social security or other annuities that are monthly same amount paid out. now as more older people start working in the labor market that has a high degree of volatility, they will start seeing volatility more akin to what younger adults typically see. it's a double edged swod, more income, less stable and people don't plan all that well. >> appreciate the time this morning. thank you so much. >> thank you very much for
8:37 am
having me. >> jpmorgan institute ceo. >> the race to space is on. more private players getting into affairiation. we'll head to state-of-the-art launch site. that's next. you're watching cnbc first in business worldwide. ance machine. with this degree of intelligence... it's a supercomputer. with this grade of protection... it's a fortress. and with this standard of luxury... it's an oasis. introducing the completely redesigned e-class. it's everything you need it to be... and more. lease the e300 for $549 a month at your local mercedes-benz dealer. mercedes-benz. the best or nothing.
8:38 am
8:39 am
welcome back to "squawk box." futures right now have moved a little bit. they have. it's the lead story. they are now up about 15.
8:40 am
>> creeping high. >> creeping high of 15 on the dow. s&p indicated up 3 1/4 and nasdaq up just under 4. >> soaring. >> surging, rocketing, ripping. >> speaking of rockets, cnbc kicking off a full week of mission space. a look at the players pushing the boundaries of space exploration. jane wells joins us live from spaceport america in new mexico with a front row seat, jane. >> reporter: hey, kayla, 10 space ports but no one making as big a bet as new mexico with this $220 million state-of-the-art space age facility funded completely by state taxpayers. >> this is space port, planet earth, 876543210 is our zip code.
8:41 am
>> this 27-square mile space port west of the missile range has two big customers, richard branson's virgin galactic paying a million a year, 20-year lease, to use the space for launching tourist toss space and space ex which plans to be launches for here. it has been operational three years, several suborbital launches but still running at a deficit. >> virgin has not done a launch, nor has space ex. we're ready for both of them but neither one has gotten to that point yet. >> are you too soon? >> i don't think we're too soon. after all we have done 28 vertical launches so far. people on the cutting edge always get pushed back. if it weren't for facilities like ours kind of leading the way, our species would never make progress. we're taking heat now but i'm confident in another few years they will look back and say, wow, those people were really smart. >> they are trying to diversify their income meantime, car commercials, a movie with gary
8:42 am
oldman coming out. still they expect to make about 75% of what they need to cover operational expenses this year, up to 90% next year and cash flow positive in 2018 even if virgin and space ex don't launch. speaking of those two we'll have an update on them on squawk alley. >> jane, you're in new mexico, have they considered opening it up to extraterrestrial space travel, too, for an additional -- that happened in nuclear, right? >> it happens. roswell over that way, area 51. who knows what happens here at night. they wouldn't let me stay. >> i think they use bitcoin. they don't use the same currency but bitcoin, maybe paypal. i don't know. thanks, jane. >> another way to generate revenue here. >> yeah. yeah. loaded. anyway, thank you. u.s. olympic swimmer michael phelps appearing on the "today" show earlier this hour. the most decorated olympian of
8:43 am
all time weighed in on life as a father and controversy over teammates behavior in rio. here is what he said about ryan lochte. >> ryan and i have been friends forever. it's always hard to see a friend and competitor go through a hard time like this. i know what it feels like. i've been through it before. hopefully he can come out of this a better person, you know. i've reached out to him a couple of times. you know, he, i think, understands a lot and he will be able to grow from this. >> all right. let's stick with sports now. san francisco 49ers quarterback colin kaepernick says he will continue to sit when the national anthem is played before games. kaepernick taking heat for refusing to stand for the star bang he would banner before the preseason game friday. he says he'll do so until he sees significant progress in race relations. critical of what he sees as
8:44 am
unpunished police brutality. he also says he knows he can be ostracized for his stand but will go it alone if need be. when we come back, jim cramer, his take. dow 15, s&p 3. back after this. [engine revs] ♪ [cheering] ♪ the highly advanced audi a4. ♪
8:45 am
hello... if i want to go down... noooo... then if i want to come back again... it's perfect. yes! now that we've added adjustable base, my favorite part is to be able to lift your legs up a little bit, lift the head up a little bit, and it feels like i'm just cradled. i love the adjustable bed cause i love it when i'm watching tv. and there you have it. change your sleep, change your life... change to tempur-pedic. now thru september 11th, upgrade and save on select tempur-pedic mattresses and adjustable bases during our labor day event.
8:46 am
8:47 am
welcome back to "squawk box," the union that represents most complainedian auto worker has voted for a strike mandate meaning workers are now in a position to walk off the job if the two parties can't come to terms. this bolsters its position in contract negotiations with the big three u.s. carmakers. the union called unifour, which represents more than 20,000 auto workers is pushing for gm, fiat, chrysler is calling to firefighters more in ontario. singapore has reported 41 cases
8:48 am
of locally recorded zika virus. more among foreign construction workers and all but seven of those in affected have fully recovered. none traveled recently to zika affected areas. singapore reported first virus back in may brought in by middle aged man who had been to brazil. questions about whether 80% of the people who have this who don't even have symptoms are leading to an undercount worldwide of zika virus. shares of herbalife rising. carl icahn bought more shares friday. the billionaire may have been interested in exiting his position earlier in august. sources telling cnbc jeffrey and ubs working independently to find a buyer for icahn's massive stake in the nutritional supplement company but nothing materialized. in a statement icahn denies his attempt to sell his stake rejecting claims bill made in an interview friday morning that he
8:49 am
was offered icahn shares. he didn't dispute it but blasted ackman, amazing me that a guy who hasn't any knowledge of my internal investment thinking can go on television to tell the world what i am thinking. speaking of carl icahn, one of the speakers for the investors summit produced by cnbc, institutional investor. we'll also hear from treasury secretary jack allow, among many others all taking place september 13th right here in new york city. more details available at delivering alpha.com. let's get down to new york stock exchange. jim cramer joins us now. we're still as far as the news cycle goes, we're still on friday and i'm trying to figure out a lot of -- it was up, it was down. not much happened at the close and not a whole lot of reaction
8:50 am
today, so-so much for that. what do we take away from that business as usual? >> i don't know. i thought there was a bit of changing of the guard midday to afternoon after the interview with dan fisher, basically banks took off. its tangible book val. i saw all the regional banks take off and also saw the industrials which kind of a little counterintuitive the dollar was going higher, the industrialing will get hurt and started hating health care, the spillover maybe about the mylan situation. i saw the banks move and group so far behind the market kite run a long time. >> is that after -- after yellen initially the dollar week weakened, didn't it? >> right. >> and fisher strong after that. >> they seem to be a tag-team that fisher is the advance man to talk about the bad news and yellen walks it back and you're thrilled that you don't go with the fisher doctrine but at the
8:51 am
same time, obviously, she's putting september on the red hot griddle. i believe there should be a tightening in september. enough. we have good data. >> really? so you're fine with that. what are the chances there will be? >> well look i think we get an employment number and it's strong you almost have to. we've got housing strong be we have a lot of consumer spending that's gotten better. i certainly think that the employment situation is safe enough and i also think ta boy, it would be great to end the talk of do one and done. do one and then you're open for december we will have a run in the financials and a lot of decline in health care and consumer package goods. the utilities and reits, wow. >> taken our gary player and you're seeing our player with a tom watson, i guess? >> well -- >> davis love. so we had davis love and gary player. you need more than tom watson. >> definitely. but i want to say i'm going to be on "halftime" and i bet we kick around the notion of
8:52 am
herbalife and find out what carl icahn is using for 2017 numbers. let's get her share per projections. >> that was something. i love watching -- really, that was all just personal, and what happened to that hug? the last of it. >> i don't know. >> i thought they were friends. >> should never talk about what the other guy is going to do. >> no. >> ackman doesn't play by the same rules as the rest of us. >> no. >> that's okay. maybe he's a trend setter and maybe he's at the vanguard of revealing secrets of er firms. maybe i should say always a seller and i may not know that but listen, corrected and move on. >> all right. jim, we'll see you -- >> look forward to "halftime" and i bet we mention some of that stuff. >> see you in a couple minutes. >> you will be with us for the hour. >> we have to get the estimate. what's carl using. don't you think in the end, scott, he has some sort of earnings per share number for 2017? >> i think he has a lot of numbers he's thinking about these days. >> i'm looking at normalized earnings pattern after the change in the ftc.
8:53 am
great to get his normalized and 2017 matching numbers for doing a silo and then another silo. i think it all comes down to whether he thinks it can do 450 after the bank deal. >> i'll see what he thinks on that. >> yeah. just want that earnings per share projection. >> you got it. see you in a bit. if you went to bed early beyonce stealing the show at mtv's vma awards with her extended performance inspired by lemonade, taking home video of the year and best female bid video, officially beating out madonna for the most vmas ever. rihanna performed four times throughout the show and was the recipient of the video vanguard award lovingly presented to her by drake and speaking of drake, the rapper missed out on accepting the first award of the night, best hip-hop video after getting stuck in traffic. we know how that goes. it was a star-studded event as always. coming up today's top
8:54 am
stories including the surprising reason why a flight to newark was delayed by ten hours. as we head to break, take another look at u.s. equity futures. climbing a little bit more than we saw throughout the earlier morning following the personal income in spending numbers that matched expectations on the nose for july. we'll be right back.
8:55 am
when a moment spontaneously turns romantic, why pause to take a pill? or stop to find a bathroom? cialis for daily use is approved to treat both erectile dysfunction and the urinary symptoms of bph, like needing to go frequently, day or night. tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. do not take cialis if you take nitrates for chest pain, or adempas for pulmonary hypertension, as it may cause an unsafe drop in blood pressure. do not drink alcohol in excess. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long-term injury, get medical help right away for an erection lasting more than four hours. if you have any sudden decrease or loss in hearing or vision, or any symptoms of an allergic reaction, stop taking cialis and get medical help right away. ask your doctor about cialis and a $200 savings card.
8:56 am
8:57 am
two united airlines pilots set to fly to newark new jersey were arrested under suspicion of alcohol. united flight 162 from glassco scheduled to depart yesterday before police grounded the flight. the pilots are due in court today. >> one thing to have one of the pilots, but to have both of the pilots? really? >> a pilot first mate, those two guys. >> yeah. >> yeah. scary stuff. the faa's new rules for commercial drones go into effect today. pilots must pass an air nautical exam before allowed to fly but
8:58 am
won't awon't have to get a pilot's license. under the rules drones must be under 55 pounds, can't fly at night or higher han 400 feet and stay in visual contact with the operator. the rules also include limits to hamper the arrival of some drone services like package delivery which amazon and others have been looking to do. the faa says it is rushing to get a more comprehensive r regulatory framework by the end of the year including rules about drones flying over crowds. loud noises at los angeles international airport caused panic last night as many confused the sounds for gunshots. passengers at l.a.x. were seen running from term falls to a tarmac after police responded to multiple 911 calls from many locations a the airport about a shooting. it happened around 11:45 eastern. police conducted two sweeps of the airport and determined reports were unfounded and no shooting. but to have this first at jfk
8:59 am
and then at l.a.x., in a matter of weeks, just makes you think there needs to be better protocol. >> it is kind of quiet sometimes and one was the olympics people were watching, just cheering and pounding and -- but you can imagine someone that wanted to scare -- i mean the little fireworks, that's all you need to do. and you don't go through security. that's the whole thing everybody is worried about now. seem like soft targets. >> that looked like chaotic. >> so was the other one. >> jfk. >> that looked chaotic too. >> three different terminals at jfk. >> all right. stocks to watch today, roche says the fda has issued an emergency use authorization fort zika virus test. the molecular diagnostic test is easy to use and allow doctors to detect the ri virus. sanofi and reagain res said their drug met trials. the drug intended for patients with high cholesterol that don't
9:00 am
respond to statins commonly prescribed for that condition. >> here tomorrow? you? >> i'm here. yeah, i'm here. i'm here. >> never know. >> andrew is vacationing. becky comes back this week maybe on wednesday. make sure you're hopefully joining us tomorrow. "squawk on the street" is next. ♪ >> good morning and welcome to "squawk on the street" i'm david faber with jim cramer. carl quintanilla is off. let's give you a look at futures. the market looking up so slightly. see it there european markets down, not a great deal of movement. london's stock market closed for a summer bank holiday. see italy taking it the worst. very glad we've included italy and spain. gone for a couple weeks. glad to see the

68 Views

info Stream Only

Uploaded by TV Archive on