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tv   Squawk on the Street  CNBC  November 11, 2016 9:00am-11:01am EST

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all-time high. there's a currency check on the euro 1.09, yen, 1.06. the pound has actually strengthened recently. there's the energy markets, oil weak, which is sort of the opposite of what you might think at this point. >> i think everything's being undone from the last couple days. >> cyclical rebound also headed. >> what a week it has been. only in america, everybody. michelle, thank you. have a great weekend, everybody. make sure you join us on monday. squawk begins right now. good friday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber at the new york stock exchange. it is veterans day when we honor those who have served in the u.s. armed forces. bond market is closed. stocks are not changing much after of course the best week for the dow in at least five years. it is day three of the presidential transition. a lot to get to. europe is mixed. sterling at about a five or
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six-week high here. and oil below 44. our road map begins with the markets and a pause in the post election rally. >> plus, we're going to get numbers from alibaba on its biggest sales day of the year. and we'll also have a live interview with its president. skb disney, the stock volatile after earnings and revenue miss, higher right now. we're going to dive into those numbers. first up, one day after the dow hit the new all-time high, the fed also in focus at a banking conference in chile. fies chairman stanley fischer calling the case for a rate hike quite strong saying the fed is, quote, reasonably close to achieving its employment and inflation goals. no real direct comment, jim, on the election per se, but nudging further along the argument he's made for a long time. >> given the run in the j.p. morgan and bank of america stocks, thank heavens he said that. i mean, this thing -- a lot of this rally involves again today with the treasuries. people are just saying, okay, look, we've been waiting for
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this treasury dive for rates to go higher for a long time. and we have got to switch every penny out of -- you pick your stock. proctor & gamble, let's use that. a great quarter. but you got to sell every share of proctor & gamble and we got to buy every share of bank of america because the fed is going to raise rates. so he's on script. dr. fischer's on script. that money ain't going back to proctor any time soon. as good as proctor is and i think it should be bought, i recognize you're in front of freight train and you're a bus in front of a freight train and it's "the fugitive." >> did i read this right? the rally getting out of hand. that there are better bargains in the garbage. >> nvidia, when i wrote that, nvidia was at 66. it was down three. i said on my game plan if nvidia comes down you must buy it ahead because they're the number one data center chip company, number one gaming company. that was a good buy. there are ones that are good
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buys. are the bond market equivalent stocks that good? i don't know. but the tech stocks. >> what's going on though with fang for example yesterday and some of these tech stocks -- >> what is fang? >> how quickly we forget, huh? what's going on there when you got the s&p, the dow obviously screaming and then you look at the nasdaq and particularly a handful of stocks that are getting crushed. >> those companies do not need a strong economy to have numbers year over year. we're looking for companies that have dramatic increases in numbers year over year. and it will not be as great with netflix as it might be with freeport. >> it is veterans day by the way. so you're going to hear a lot of this today at the new york stock exchange. there's going to be a cake cutting ceremony on the floor. and about two minutes followed by "god bless america" at 9:20. 9:25 a moment of silence. and then of course the opening bell at 9:30. later on this morning of course
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the president will lay a wreath at the tomb of the unknowns at arlington national cemetery at 11:00 a.m. but what an important day, jim. >> oh, we devoted our show last night to it. kind of broke form to have alex g gorski on. i think we can clap and that's great, but hiring is the way to show healing and unity. because they come back, millions, and they are not necessarily ready to get a job. and there isn't a good enough system, although everyone tries. you want to show love of vet, hire a vet. >> i would argue it used to be more difficult. it's gotten better. >> it's gotten better because of some really terrific ceos who have stepped up. >> corporate priority. >> jamie dimon made it a priority, howard schultz. >> i mean, these guys, this is a mission for them. when you're with alex, as much as he loves j&j, wants to talk
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about the foundation set up by a neighbor who literally lost her brother in iraq. this is what he wants to talk about. because he thinks things are bigger than j&j, largest health care company in the world and i love that. >> it's never made any sense to me why it's so hard. we've got veterans who are trained, disciplined, are schooled to work in an operational context. think about the unit rather than the self. it's a no-brainer. >> operate under stress conditions. >> yeah. >> we had 40 cadets yesterday and then there were some veterans and there was a woman there who was at west point. what is she doing? she's running cyber security for j&j. would you not want someone who served in our armed forces who did cyber security running your cyber security? i mean, how could you not? how could you not? >> we'll talk about that a lot more today.
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goldman today says of all the topics number one thing that comes up with clients is corporate tax reform. and the degree to which the s&p earnings would move 8% higher if the plan that we're looking at actually happens. >> well, i do think that this -- how much of it -- they don't know how much to purchase or dividen dividends. >> rate would go from 26 to 20. >> oh, the rate itself. not in terms of what money is brought back and potentially applied to buybacks and share count reduction. >> happens immediately. >> yeah. >> and the other thing that happens immediately, you see that we're dismantled for dodd/frank. a lot of people talk about this point you can't easily dismantle -- you can dismantle anything. >> it will take a little while, everyone the aca's going to take
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a little while to repeal and replace. >> but the stock market's not waiting. the stock market's made its judgment. >> and the thing is it's the lack of divided government. we've been living with it now for a long period of time. now you can clearly see a road map that gets you to this outcome, especially on tax reform. >> right. >> where there's a great alignment between president-elect and obviously both houses of congress. >> yeah. people have to recognize remember you would always have this why don't we have tax reform and democrat would say they have to first agree to having higher rates for rich people. >> right. >> and the republicans would say, no, they first have to cut the taxes. i mean, it would be this insane thing if there was never going to be a meeting of the mind. never. you couldn't have a meeting of the minds. well, now the minds are melded. >> i'm still trying to understand the action over the last couple of days, in particular led by the 10-year and the yield which has gone up -- >> gone up again today. >> where are we now above 2.1? >> yeah. >> what impact that's had back
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to the technology stocks, google, why was it down so much? or apple you could make an argument because of china that figures in, even though they have so much overseas and that might come back and that might be beneficial. on facebook, why down so much, jim? >> well, because facebook is a very done trade. i mean, people have recognized that it could earn say $8 and that's great. you don't raise numbers on a new president. you do raise numbers j.p. morgan. >> is it a rotation? >> yes. >> what's it a rotation to? >> you can raise numbers on a lot of companies. i mean, that's a belief that you can raise numbers on a bank. >> right. >> you just can. dramatically. >> there's a story -- there's a school of thought that companies with high effective tax rates are outperforming this week. >> well, that's very good. >> but a wider dispersion in companies levered to repatriation. google and amazon and microsoft and apple.
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>> you know, some people feel there's retribution going to happen. that these are companies that are in the cross hairs -- no. >> on amazon you wonder a little because there was the feud. i don't know. that's specific between the president-elect and mr. bezos. >> right. >> and whether that actually becomes anything. who knows. >> i don't know. prince alaweed, talk about personal gets solved during an interview on "squawk on the street." i remember when i was a hedge fund manager i would say, look, who's going to have the biggest number gains year over year? and one of the guys would say, well, you know what, we already decided that's going to be microsoft. no, i said no. everyone knows microsoft's going to have big up -- who did we not think? and it would be like reynolds metals, go from earning 6 to 23, i remember there was a time it was like, hey, listen, reagan, bethlehem steel, i'm taking minus to plus 24. the analyst drive.
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you're seeing and when you look at matthew boss's numbers what he's say about these retailers, which by the way good feeling on retail. did you see the runs on macy's and kohl's? >> business confidence is moving up a bit because the idea of less regulation. >> but copper's not up three days in a row. it's up 15 days in a row. >> an all-time long streak. that is just animal spirits, no trade war in animal spirits. people don't think there's going to be a trade war. >> why not? why don't they think there's going to be a trade war? who knows. >> you don't know. the press is very good about it today, but when you see copper up that much, it's not just short squeezed. there's got to be some real demand. but it's not going to be in this country. we don't use copper the way we used copper ten years ago. you know, copper's been replaced by aluminum. >> right. >> but alcoa have you seen that monster since that was unleashed? >> did you see wells fargo yesterday? >> wells fargo, my travel trust
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owns wells fargo. this is going from the company that was going to be the poster boy of bad, right? when we were going to have draw on the quarter mutiny and bounty hearings with president warren meeting with president clinton about tim sloan doesn't belong because he's from wholesale which is same as retail. suddenly it's like, hey, wells fargo, whoa. >> best week for banks since 2009. >> yeah. >> 2009. not to mention as you said metals. copper for the week up 15. nickel 13. iron 10. >> valet is up. look, there's a consumer protection period. you know there's a protection bureau that was created to protect us from banks. >> yes. >> well, i don't know, what do you think we do with that? what do we do with that? >> i don't think much happens there. >> maybe we make that more of like a pta thing. i mean honest to god. you can eviscerate agencies. i remember taking this agency law class at harvard and it was
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like while we were studying reagan was dismantling the agencies we were studying. well, how about this, you know, federal like faa, well, that's -- nothing, he got rid of the faa. there's craziness. you can get rid of these agencies. >> hope we don't get rid of the faa. i think we need that. >> but you can put people in there who are just like the -- >> got rid of air traffic controller strike. >> right. when they started icc it was packed with guys who like the railroad. you put the people in these agencies that are like-minded and you don't really have -- you know, wells fargo suddenly gets a congressional medal of banking. you didn't even know they handed it out. >> i didn't. i didn't know that was a thing. >> you didn't know they got the congressional medal of banking. >> missed that ceremony. >> we have a lot of movers we haven't gotten to yet including disney and alibaba. also templeton's mark mobius, take another look at the premarket after that dow all-time high on a closing basis in the best week for the s&p in
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two years. we're back in a minute.
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as we said earlier, u.s. bond market is closed for
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veterans day, but regular hours for globe x. rick santelli is going to explain at the cme. good morning, rick. >> good morning, yes, the cash markets closed and the bond market association of course and everybody paying their respects to all of our great american veterans on this veterans day. but a lot of other markets or cash markets are open. so we're going to take a little walk through other global sovereigns. let's look at a one-week of bund yields, climbing. one-week of italian, over 2% climbing. one-week of canadian yields over 1.50. a one-week of gilt, that's the uk getting closer to 1.40. and everything you should have noticed there that i really want to draw attention to is that even though their yields have moved up pretty progressively after the election results like all markets have had a big move, they have come off just a little bit. now, if we look at a one-month of the ten-year, i'm only showing you the cash, it is closed, but i want you to see the pattern there because i want
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to show you a market that isn't closed that we don't use as much, a one-month of ten-year note futures. so of course as the yields are moving lower -- or higher, you see the futures markets are moving lower. so that one-month chart you're looking at of ten-year futures is really the mirror image of that cast chart. the reason i'm showing you the live action is the same dynamic we're seeing in other sovereigns. we've had a lot of aggressive sessions where the price of course has moved lower as yields have moved up. but what i want you to notice is they made a new low and then it reversed a bit. so if we were to actually open our cash market, yields would be a little lower versus a little higher, and most likely that's because the cash market is closed. not an aggressive tendency there. but the other sovereigns are of course still holding on to the bulk, and i mean the bulk of the gains. let's look at what's going on with the dollar index. that's a one-week chart. here's what's noteworthy, we are now toying once again, once again with unchanged on the year
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98.63. back to you. >> thank you, rick. rick santelli. well, alibaba's holding its annual singles day online shopping event. the company has well surpassed last year's total $14.3 billion in sales. as of the last hour gmv surpassed $15 billion u.s. alibaba's president michael evans is going to join us live from china a bit later in the hour. growth is decelerating year over year. that's expected law of large numbers, but it will be interesting to talk to him also in part of what they've been looking outside china what does a trump presidency mean for those ambitions in terms of being able to sell and people buying. but overall a successful singles day it appears. topped off a little bit. >> right, david, i think what i'm curious about they sell a lot of apple products. >> yes. >> is there anyone starting to rumble that if trump comes after
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us, we have levers, we don't need to sell apple products on alibaba? the communist party controls a lot of what happens including i'm sure what merchandise gets sold on alibaba if they want to. >> i think it's a fair point. and there's going to be a lot more focus on what levers china has if in fact we do certain things, for example, item number one was labeling number three i think on the trump agenda was labeling currency manipulator. >> yes. >> so a lot of talk about the uk as well. part of the reason people say the sterling's higher is a soft brexit is more likely since may and trump can work a lot closer together and that strengthens her hand. >> well, sterling, that makes sense. there's an article in "the wall street journal" about areas where the actual article's about, that's where i go in mexico where there are 500,000 cars being built and there were no cars being built when i moved
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there. >> when we come back, howard schultz of starbucks saluting our veterans. you'll hear what he told jim on "mad money" last night and you'll get that moment of silence in just a couple of minutes. ♪ ♪ ♪ is it a force of nature? or a sales event? the season of audi sales event is here. audi will cover your first month's lease payment on select models during the season of audi sales event. (bing) what are you doing? getting your quarter back. fountains don't earn interest, david. you know i work at ally. i was being romantic. you know what i find romantic?
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veteran-based. they have an apron that says they're a veteran. and i think what we've tried to do is raise national awareness and discourse about what it is to serve the country. >> just got a chill hearing him talk about that. >> i thought so too. and what howard was saying don't hire the veterans because it's right thing to do. you hire the veterans because they'll better the other employees. he is saying this is who we love to hire. >> yeah. >> and i think that was really important because i think there's still a sense of like, well, yeah, there's patriotism involved, but he's saying it's patriotism mixed with the fact these are great hires. this is where you get your people. and it was chilling because he's talking about we're entitled because of what they did. now we have to do what's right for them. >> right. >> but also what's right for our company. >> you'd like to see an environment where it's not service jobs, it's not all food and bar tending and waiters, right? >> well, i mean, throughout the
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organization. but you're absolutely right. i do say one of the things that howard talked about is getting people to be able to apply for jobs, get involved in the workforce. that sometimes people come back and service people are not necessarily trained on how to get, you know, to go for a job interview, to do things. very elemental stuff that they can navigate through things that we'll never be able to navigate that are frightening, that are difficult. but the process of getting a job is sometimes difficult. >> yeah. i wish there was a lot more discussion in this country about national service in general. maybe even mandatory national service, which we don't really hear a lot about, the idea that you owe your country something. not necessarily military. there are so many ways people can serve. but it's a lost idea. it's a lost idea. general stanley mccrystal is one who's been talking about it for a long time. but you don't hear about it enough. >> no, not enough. both howard schultz and alex, we
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talked about the notion of what it means to serve. what it means to serve. wow. >> by the way if you look at the balcony this morning you'll see the honorable patrick j. murphy, undersecretary of the army joined by members of the five service members. we're going to hear two minutes of silence here in observance of veterans day. [ moment of silence ] [ moment of silence ]
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[ moment of silence ] [ moment of silence ]
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[ moment of silence ] [ bell ringing ] >> if you know a veteran today, make sure you thank them for their service. day actually coincides with other holidays around the world commemorating the end of world war i. how this all began. >> my grandfather served with pershing in the calvary great picture on the horse, new generations, they don't know. they don't know there was the great war. and they don't know the significance of the day and it's a shame. they don't teach it. >> what a reassuring way to end
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this week, right? i mean, the country is looking for anything that is unifying. and this is one of them. times has a stat today, 60% of voters live in counties that were won by a landslide, either way, right? that's crazy. >> that is really -- >> we need to start looking for things that we can all agree on. this is among the most basic. >> alex comes out says e plur bus unum. we're reaching back to founding fares what it means to create a country that is very different. maybe it's working. there's a spirit. i felt it. i don't know. i felt it when reagan was elected too. that was a different man, different time. but thought maybe it's going to be different. it was that morning in america. now, i revered ronald reagan, thought he was an amazing president, amazing uniter, younger.
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still do. but you feel that way. i just don't know. it's a different time. different president. >> now, a bridge between that discussion and our own business is buffett today who tells cnn that the market will be up in 10, 20, 30 years regardless of who won on tuesday night. >> look, it's such a thing called progress. and progress is favored a lot -- you know, american companies. s&p 500, yesterday the -- >> that's echoing his theme of long-term progress that will be reflected in equity values. >> that's fine. the cadets -- we had 40 cadets said what should we do with our money, say go serve s&p index fund. and think long term. and s&p. and don't think about it. think about your job. it's bigger than what -- >> no active management. you didn't recommend that, did you? >> no. >> let's get the opening bell here on this veterans day. as we said earlier, the
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undersecretary of the army, the honorable patrick murphy commemorating the holiday joined by members of the five service branches. and we'll await the president at arlington national cemetery in about an hour and a half. over at the nasdaq, over 40 companies supporting veterans and their hiring initiatives. so we move from that. the guys want to talk some disney. >> i'm always defer to david on disney. david, disney, faber. >> it's interesting, the numbers were not particularly well received, the stock is up on this particular morning. why? you can look at a number of different factors perhaps. some saying it's been too penalized over these last few months since the continued concern about erosion at espn has overcome a lot of the positives at the company. that may be one reason. mr. iger on the conference call did speak in very bullish tones
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about espn indicating that the rise of other platforms in which he can be -- espn can be a part is actually an opportunity, not necessarily as much of a negative as people see it given the unbundling that's taking place. you know, i think we'll see. we'll see how it plays out. they still are losing subs. >> did you see the u-turn in the stock and the answer to michael nathanson's question? >> yes. >> the stock's going down, down, down because the narrative not so great. then ask a question about espn and bob iger says we've taken a more bullish position on the future of espn sub base. the stock stops right there, does a u-turn and goes up four points. on that one sentence. because he has credibility talking about the dmv -- talking about the other ways -- >> right. tapping this incremental demand that may be there from the other bundles we now talk about so often. whether it's a directv now or the sling bundle or all these, again, what we call mvpds, i
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know there's so many initials. >> i know. but the takeaway was they are going to do a lot more interactive. they're going to be able to do what is currently not measured, that he is saying is going to count. but he has a lot of stature in the business. and if he says he's more bullish, then i'm more bullish. >> he's not sweating it. >> he's what? >> he's not sweating it, mr. iger. >> no, he's not. >> i don't believe. but it doesn't mean the challenges aren't real. i did put this to john malone yesterday in our interview, how much pressure does he see mr. iger under, he didn't take the bait on that. but he did answer interestingly in terms of what he sees as the future for the company give b it is the only very large entertainment complex out there that is not controlled. take a listen. >> if i had to guess what you will see is a split of disney with espn spun off and probably espn could be owned and
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protected by a distributor in the u.s. >> he went onto say apple perhaps would be more interested and they would have a lot more in common in terms of international branding. by the way, none of these ideas that are speculated on are probably news to the likes of a disney. you've got bankers who call on these companies all the time with ideas. it doesn't mean any of them are going to happen. but it is an interesting idea that apple would be interested in a big part of it, but then you'd have espn protected by a distributor, meaning a comcast or a charter. >> charter. >> which is controlled -- well, 27% owned. >> what'd you think about the talk of the direct to consumer? there were a lot of people said implicitly this was a series of q & a made it a narrative that he wanted twitter. that twitter is underneath. i've talked to analysts saying, jim, you're reading through that. don't forget adam bain, from twitter, if anything's going to
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happen adam bain would have left. i just felt this was an embrace of the notion of direct-to-consumer. is there anything more direct-to-consumer than twitter? >> there isn't. and as i reported, disney's interest in twitter was quite serious. and more so perhaps than i'd given it during the reporting that we were doing at the time because of course when you look at it howdy lute e diluted the acquisition would have been -- >> he was -- >> he was asked a question again and didn't say anything new, jim, in terms of interest direct-to-consumer. >> you're right. i just felt to me the big leap of faith is that twitter has a hate following on it that is not anything that mickey mouse wants to be affiliated with, you know what i mean? it's just not. and they can't clean it up. and they've got to clean it up. because it was also a deal breaker for somebody else who was involved. >> yeah. regardless of what prince
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alawaleed told us 24 hours ago, beginning to see signs of success. >> there are people who feel if they were able to be able to buy the company if after a year they could clean up the particular problem of the hate, but it would require gross margin decrease because you would have to hire basically a concierge service. because disney can't be affiliated with the kind of pure hatred that goes on on twitter. and it's hard to have -- you know, if you talk to twitter, say listen, just put the filter on. i mean, the filter, put the filter on the love canal, right? put a filter on that. >> tweets to toxic waste. >> why not? >> well, i got to tell you, i live next to iguanuas. >> how are they able to do that. >> the guanas, they dye the
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river green according to "fugitive," every time you go over it it's a new color. it's really kind of incredible. it's green, it's blue, has bubbles. it is like from "batman," it's gotham city. >> it's like letterman used to say he loves new york in thanksgiving because the tap water turns a brilliant orange. remember that line? >> that's always been our best thing, our tap water. >> i got to tell you toll brothers was going to make it like venice and then declared it a super fun site. one of the things president-elect trump should do is reverse that so the toll brothers could clean it up and make it venice. some small dredging has happened, watch see what president-elect trump does. if he takes away the designation that hurts product development. because he knew exactly what was going to happen. it was going to be one of the great developments ever and it just got killed by being designated super fun. >> although he's committed to
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dismantling the epa to a large extent. >> dismantle, epa. >> yes. >> the clean water act -- >> i think clean water, clean air maybe, but the gentleman advising him on that is certainly not interested in a lot of the parts of the epa. >> yeah. >> a lot of it is regulatory, but we'll see. >> well, i can tell you that the designation of a super fund in often cases means that you're going to have toxic waste there for a long time because it's just too much government involvement and not enough corporate involvement. >> certainly that's going to be the debate. >> and really front and center because it could be the greatest thing that ever could happen to brooklyn where i'm very involved in charity and my wife is, but instead a super fund site toll brother ks do nothing. >> disney is the top dow component, but the dow is down slightly. let's get to bob pisani. bob. >> carl, happy friday, everybody. markets pausing for very good reason. we're reaching limits about how far we can go without more
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policy initiatives or indications of what's going to happen. look at the major groups here for the week. banks up double digits 12%. pharma up 9%, industrials up 8%. copper up 20%. rsi, relative strength indicator 100. i've never seen that. it's about as much overbought as you could possibly get at this point. again, we have to see more details on what's going to happen on obamacare, dodd/frank, tax cuts. did you see this letter of 600 doctors to president-elect trump basically pushing back on the idea of higher drug prices? don't allow the pharmaceutical lobby to set terms for drug pricing specifically saying allow the government to negotiate medicare drug prices. this is a very controversial issue, but basically the idea is just going higher on drug stocks on the idea you can raise prices is not going to work here for a lot of people. so we're getting some pushback already on this idea. speaking of going up and moving up this week. did you see the asset managers and some of the brokerage firms that have been moving this week? all of them are on the upside. so e-trade and schwab up double
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digits, piper jaffry up big. hopes the fiduciary rule may be changed. these are all stocks that benefit when trading goes up, their earnings tend to go up. higher rates also benefit for e-trade and schwab. did you see what happened cme group? they put out a trade yesterday saying it was the highest record day for all-time for them. all-time records. crude futures, all-time records in 10-year treasury options trading. s&p weekly options all-time record. gold and copper futures, all-time record. this is realitily really an extraordinary week for the trading community and there's a lot of hope maybe, maybe trading is back in some kind of way. by the way the ceo is retiring this week, terry duffy will be back for them. as for discussion what's changed for retail? what's kind of changed is much better commentary out there. nordstrom, macy's and kohl's
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cited uptrends, upbeat look for the holiday season. we'll hear more from target and home depot next week. jc penney was down today. not quite as strong as the other ones were, but overall the commentary very good. finally from historic highs, guys, s&p just 1% away. russell mid cap got a little bit further to go. what an extraordinary week, guys, back to you. >> thank you very much, mr. pasani. alibaba singles day underway with just over an hour left actually in that annual promotion. it's gross merchandise value already has reached $16 billion in u.s., well past last year's total gmv during the event. joining us from shenzen, evans joining us. i know it's loud there, i'll speak up. talked to a couple investors say great day, although they know the deceleration in the growth rate, the law of large numbers
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makes that more likely, but are you happy with the way singles day has tracked thus far this year? >> david, first of all, nice to talk to you. sorry, i can't see you live. but we're delighted with the performance of our global shopping festival. we still have more than an hour to go, but the progress has been terrific. the experience for the brands that are engaging with the chinese consumers has been terrific. the consumer engagement in the way that we're working with consumers not just to buy things but to involve in the live streaming, to involve them in ar and vr, new things we're trying out this year has made this a very special experience for them and for brands to develop their relationships directly. >> people always look to not just this day but alibaba overall certainly as a reflection of the chinese consumer. recently there's been a sense that the industrial economy in china's picking up, but not as much on the consumer side. what is your read?
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>> my read's very straightforward. having spent 22 years watching this economy, i think the focus on the major trends is what people should be thinking about. and there are two big things happening. one is removing from manufacturing from services to services. and the other is that we're moving from exports to consumption. so the manufacturing sector's lost 5 million jobs in the last couple years, but 18 million jobs have been created in the services sector. when you look at what's happening in consumption for the first nine months of this year, total retail consumption grew by about 9% or 10%. online retail consumption grew by 20%. and our latest quarterly reports we top line revenue grew by 55%, which is primarily driven by the retail consumer in china. so we feel pretty good about where the consumer is today. and where they think they're going to be in the future. look at what's happening on our platform today. if you're in any doubt as to what's happening with retail. >> mr. evans, jim cramer, thank you for coming on the show.
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if we have a new president in our country, president-elect trump, and i know he's expressed concern about trading and fair trading with china, are there a possibility -- let's say comes in very strong against china, say it's a currency manipulator, does the communist party, or do the people of china, say you know what, we're not going to buy american products, or we can go buy samsung phones say instead of apple phones, pretty simple. how much is commerce related to politics in china? >> jim, it's a good question. i don't know the direct answer, but let me give you my view on this. united states, great country. china, great country. the two biggest economies in the world. if those two countries work together remembering that i'm a canadian, then both of those countries will do extremely well. but even more importantly the rest of the world will do well. and the rest of the world is relying on the united states and china to figure it out.
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>> well -- >> i have a high expectation that's going to be the case. >> on that note, mr. evans, what are your expectations with a trump administration? here i'm speaking not just about alibaba's ambitions to obviously move beyond its borders in china to sell things to u.s. consumers, but as importantly get u.s. brands to be a part of tmal. are you concerned that that progress is going to be slowed given the rhetoric we heard certainly during the campaign from president-elect trump? >> if you look at what's happening today, and this is the first big event since the u.s. election, the single biggest beneficiaries of 11/11 are u.s. brands, thousands of them, that are exporting their products to the chinese consumer. we could not be happier with that. what u.s. brand wouldn't be happy -- or u.s. retailer, whether it's target or macy's. this is an opportunity for brands that doesn't hurt the u.s., it helps the u.s.
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it helps create jobs. and i think that trump will be pragmatic in thinking about what is the benefit to the u.s. in being able to attach those businesses to the chinese consumer and in the future consumers in asia as we continue to globalize. >> mr. evans, while we've got you, talked to a couple of your investors this morning. they raise the question about the pace of investment at the company. specific to into the commerce business, being a bit concerned about you putting money towards things that aren't going to pay off in the near-term. how closely do you monitor that? and can you give us any sense into how you think about investments in the commerce business and various ways and when you're going to get paid back on them? >> well, first of all, we provide very detailed disclosure now in our financial reports about the margin and the investment that we have in our existing businesses and the new areas of business that we're building, which by the way include other things than commerce.
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but you know by watching what i've been doing over the last 14 months that we for example made a big investment in the leading e-commerce company in southeast asia in the top six countries. we don't expect that that business will start to show a return for some period of time. but if you think about the history of alibaba and the way that jack has built the business, it has been first of all make sure that we make the right investments to position ourselves for the opportunities of the future. secondly, once we have great platforms and a core business with margins of 60%, spend a portion of that margin on the future development of the business so that we can globalize. we then will provide an opportunity for small businesses, brands and retailers around the world, but also the global consumer. i think we've got the balance just right. others may have a different opinion, but this is the way we're building the company for the future and it seems to work pretty well for investors. >> mr. evans, a bit of a stretch
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here, but what happens if say a president-elect trump decides to empower the s.e.c. to further go after your accounting issues and say, listen, we're not going to accept what they're doing because the accounting's funky, and do something against the actual stock? is that farfetched? >> jim, couple thoughts on this. first of all, we're very comfortable in the accuracy of our reporting and in the quality of our numbers. number two, the s.e.c. sent us a request for information on a variety of things. we've responded to that and we're working in full cooperation with the s.e.c. and we're not concerned about both what they're looking at and also what we're disclosing. if you then look at what we're doing in 11/11, we have very carefully prescribed procedures by our independent auditors, twc, in terms of how we're going to track and record these numbers. so everything that records it gets recorded is a reflection of
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a transaction that has been paid for through ali-pay. so we feel very good about our numbers. politics we can't control, the quality of what we disclose we can, and our ability to work cooperatively with governments, regulatory agencies around the world is a hallmark of building this business for the global markets. >> well, mr. evans, we appreciate your willingness to take some time out from of course a very big day for alibaba. michael evans, president of alibaba. thank you. >> thanks, guys. pleasure. when we come back this morning kroger ceo rodney mcmullen, we'll get his take on the consumer and upm coing trump presidency. and also this afternoon jeffrey gundlach with how his election will effect the markets. copper having a much more wild ride today as it goes into the red for the first time in a couple weeks.
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now that fedex has helped us we could focus on bigger issues, like our passive aggressive environment. we're not passive aggressive. hey, hey, hey, there are no bad suggestions here... no matter how lame they are. well said, ann. i've always admired how you just say what's in your head, without thinking. very brave. good point ted. you're living proof that looks aren't everything. thank you. welcome. so, fedex helped simplify our e-commerce business and this is not a passive aggressive environment. i just wanted to say, you guys are doing a great job. what's that supposed to mean? fedex. helping small business simplify e-commerce. we mentioned earlier fed vice chair fischer speaking this morning. let's get to steve liesman with
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breaking news. >> stan fischer making first comments about the possibility of changed economic policy under a new president. talking about the possibility there could be more fiscal policy, more deficit spending, more tax cuts. he says fiscal policy could, quote, ease the task of monetary policy. and he cites the idea that he's already said this before and said it again that he and other members of the federal reserve welcome the possibility of more expansi expansionary fiscal policy. as to the effect on rates, he says more fiscal policy could pretty much alter the fed rate outlook by changing what the fed considers to be the underlying neutral rate. here's what he said. >> there are more than one policy tool. there is fiscal policy. and in this particular instance it could be used for quite a few reasons. and we'll have to see what happens. >> he had earlier said in his speech that the case removing accommodation was, quote, quite strong. i think the market has already
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figured this out that more fiscal policy from new administration is going to change the rate outlook, carl. >> good to know. thank you very much, steve liesman. we'll get stop trading with jim in just a moment. or fill a big order or expand your office and take on whatever comes next. find out how american express cards and services can help prepare you for growth at find out how american ewe're drowning in information. where, in all of this, is the stuff that matters? the stakes are so high, your finances, your future. how do you solve this? you don't. you partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person,
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keeping the power lines clear,my job to protect public safety, while also protecting the environment. the natural world is a beautiful thing, the work that we do helps us protect it. public education is definitely a big part of our job, to teach our customers about the best type of trees to plant around the power lines. we want to keep the power on for our customers. we want to keep our community safe. this is our community, this is where we live. we need to make sure that we have a beautiful place for our children to live. together, we're building a better california. time for cramer and stop
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trading. >> listen. nvidia, one of the greatest quarters i have seen. and there are several reasons why. it's not just simple graphical user game cards which matter, that's how you get great nba 2k experien experience. thank you to eric johnson for doing this from the street, it's artificial intelligence, it is going to be able to try to reverse tech. you're seeing it with nvidia and then skyworks solution, applied materials, if there is any hope for tech to reverse, it will have to be relied on nvidia because that stock is up 15, what a quarter. >> it is the best gainer for the year by a mile. >> people must listen to the conference call because what it says is you may want to sell tech, but look out, we've got the best chips in the world. this is what intel was like when the 286 came out. it's that good. it's that good. >> jim, what's on mad tonight? >> we have apple hospitality. we have popeye's, one of my theories is people are going to go out again. go to the original popeye's,
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fantastic, happy birthday to cliff mason, my head writer for "mad money" who happens also to be my sister's kid. >> which would make him your nephew. >> you're not allowed to reveal that. >> sorry. >> i know. he's like 14. >> he's good. >> "mad money" 6:00 p.m. when we come back, templeton's mark mobius on emerging markets as we enter the trump era. dow's down 18. don't go away. remember here at ally, nothing stops us from doing right by our customers. who's with me? i'm in. i'm in. i'm in.
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♪ good friday morning. welcome back to "squawk on the street." i'm carl quintanilla with sara eisen and david faber at the new york stock exchange. market a lot more mild than it has been the past four sessions but remains the dow's best week in five years. now we're getting some economic data crossing the tape. and for that we go to rick santelli. >> i'll tell you, there's some surprising features to this one. remember, this is the preliminary read for university of michigan sentiment survey, november preliminary. so we're comparing it to october finals, but there was definitely a pretty nice jump here. the final read last look for october was 87.2. that was the weakest in two years.
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we jumped up to 91.6. now, if 91.6 was considered to be the final read, highest read since mid-year, basically june. here's the interesting part, the inflation reads. many of us have ignored them because it didn't seem like with the growth we had we'd see any pricing pressures. a lot has changed. so 2.4 was our one-year inflation based on university of michigan. that jumped up to 2.7. 2.7 would take us back to the highest read outside of april which was 2.8. here's what even gets more interesting. we also jump from that kind of historic low 2.4 in the five to ten-year inflation outlook read, and that moved to 2.7 also. to find a read higher than 2.7 on the five-year, you're going all the way back to july of '15. now, surveys, inflation, you look at the break evens, consider some of the issues that could go along with trade and the new administration, i'm not sure how fast they'll proceed,
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nobody is, but even above and beyond that we see inflation is starting to percolate. maybe part of that was also brexit. but something to consider on this university of michigan november preliminary read. sara, back to you. >> one last question from me, rick. some confusion about you mentioned the survey whether it was conducted prior to election, post election, do we know? >> you know, i don't know the exact cutoff date, but my sense is that probably this read doesn't reflect some of the issues on the election results. but we will look into that more closely. >> thanks, rick. keeping an eye on the market, dow down. not all markets are cheering. emerging markets are getting hammered following trump's surprise victory. msci trading near lowest levels since july. three straight weeks of declines and can't forget the mexican peso weakening 14% against the
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dollar since election day. let's bring in templeton emerging market group executive chairman mark mobius, long-time expert joining us from dubai. welcome. how much has the outlook changed for emerging market post-trump victory? >> big, big changes because the volatility has been increasing. you just look at the mexican peso. i mean, it's been all over the map. and i think you're going to see more and more of that with the uncertainty that's in perhaps the trade negotiations and all the rest of it. so we expect a lot more volatility in emerging markets. >> so you don't think it's priced in this idea that trump's economic policies might be good for the u.s.? you see that optimism reflected in this equity market, but bad for the rest of the world, is that the view? >> well, to some extent that is true, but it depends on the
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individual country. i believe that trump is going to have bilateral negotiations on trade and investment with each country, whether it be china, mexico, india, et cetera. and that will really determine the direction. going to sit down and work out deals and scrap all the multilateral deals that have been scrapped in the past. so it remains to be seen. i'm of course being emerging markets like the fact that emerging markets may benefit from what trump is doing, but it remains to be seen. >> let's talk china specifically since you mentioned it. he's threatened to call china a currency manipulator on day one, something i don't think we've seen since 1994. he's threatened tariffs. what happens if trump does play hardball with china? even if they do continue the trade relationship and to have, you know, a fairer relationship as trump would say, what does that look like?
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>> well, if he plays hardball the sense of imposing big tariffs on china, of course they will respond equally. and that won't be good for either party. i think once they begin to examine the interest rates situation and also the exchange rate situation, they will begin to realize that the chinese are not deliberately in charge of what's happening to the currency. as they loosen up the reigns of currency restrictions in their country. so there has been a net outflow. and they've liberalized the currency. so it will be interesting to see when they begin to talk about what's actually happening to the markets. they may decide that maybe china's not manipulating the currency and that they may want the chinese to manipulate oecev more in order to keep stronger.
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which means restrictions on our flows from china. >> it would also mean going back on a campaign promise that he repeated multiple times, mark. so what sort of moves are you making in emerging markets? are you selling the mexican peso and buying russian ruble, or what? >> we're taking advantage of the volatility. for example, in the case of mexico, it looks like a great opportunity to buy stocks. the currency is down dramatically. chances are they'll probably stabilize at this level, maybe go a little weaker, but generally speaking this provides great opportunities for us. because i think as the administration gets its feet on the ground and begins to realize what's happening in the world and become more realistic, these markets will recover. >> mark, are we going to see -- have we seen and will we continue to see multiple contraction though given the risks that you've outlined to a
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certain extent? >> yeah, there will be contractions in a number of markets, but you must remember where we've been and where we've come from. mexico of course is in deep trouble and has gone down a lot. as i mentioned, this could provide an opportunity for us to buy very cheap mexican assets. brazil as you know has had a tremendous recovery. they're going through reform in a big way. and i believe that the upside for brazil is still there. if trump begins to loosen up on restrictions on trade with russia, that could be another positive for emerging markets generally because russia is potentially a very big market. so there are a number of positives that we can see coming down the road. but we have to watch each country very, very carefully. >> mark, one thing we haven't talked a lot about this morning are the protests. i mean, they're stcentered in parts of the country where it's not surprising to some, portland, oregon, for instance.
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earlier in the week it was austin, texas. but when you think about how markets have performed in areas of social unrest, what comes to mind? >> well, if you look at social unrest, it's happening globally of course through the internet. we're seeing revolts around the world, desire for change. if you look at south africa, for example, there've been demonstrations against the current government because the corruption. you're seeing the same thing in various parts of india. in china as well. it may be not in the news but definitely protests taking place in these various countries. people are much more aware of what's going on because of the internet. and they're not paying as much attention to the mass media as they did before. so we're in for a lot of surprises, just as we were surprised with the election results in the u.s. i think the same thing is going to happen globally and particularly in emerging
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markets. >> finally, i did want to ask you about the commodity trade here, mark. copper has exploded higher this week. are you making the bet on higher infrastructure spending in the u.s. and potentially elsewhere? how far does that spread? do you buy countries that produce commodities? what's the trade? >> well, the u.s. is a big consumer of commodities, but not as big as china. i mean, it's a factor of maybe ten times. china is much, much bigger on the commodities side. however, the infrastructure spending in the u.s. will help stabilize some of these commodity prices. but as you know already since the beginning of the year commodity prices have come up. and we expect that will continue but at a slow rate. they won't be a dramatic move up. they'll be a gradual increase in commodity prices. not only because of the u.s. but because of what's happening in india and other parts of the world. >> mark, thank you. good to talk to you this morning as we watch these emerging markets.
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mark mobius. who's buying mexican assets at this price. >> and -- >> always. >> as we come back, state of america under president trump, we'll speak exclusively with kroger's ceo rodney mcmullen and liberty's ceo greg maffei. baba breaking records smashing singles day sales. we'll head to shenzen when we come back. go after it the same way?ny chasing after short term returns. instead if getting caught up with the crowd, the investment managers at pgim take a long term view, teaming specialized active investing with risk-management rigor, to seek out global opportunities. we manage over a trillion dollars this way, attracting many of the world's leading investors. partner with pgim. the global investment management businesses of prudential so what else is new? humm..she's doing good.
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she needs more care though. she wants to stay in her house. i don't know even where to start with that. first, let's take a look at your financial plan and see what we can do. ok, so we've got... we'll listen. we'll talk. we'll plan. baird.
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america's biggest grocery stores have been under pressure lately from falling food prices, sluggish consumer sentiment and some big shifts in spending patterns. that does include kroger, the nation's largest grocer besides walmart. but the company did reaffirm its guidance at investor day last week which mostly encouraged analysts. joining us now in a cnbc exclusive interview is the chairman and ceo of kroger, live from cincinnati, ohio, rodney mcmullen. rodney, welcome back. nice to see you. >> great to see you, sara. and first of all, happy veterans day for all those active duty military folks and all the retired military folks. >> indeed. we all give our gratitude. thank you for that. rodney, your stock has gotten a nice shot in the arm this week up 6%. do you think that president-elect donald trump will be good for your business? >> well, so far it certainly looks that way. as you know, we look forward to working with the new administration in getting the growth again and getting jobs
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started. so it's exciting. >> there are a number of ways your business specifically could be affected, lower corporate tax rates, potential repeal of obamacare, what specifically are you watching in terms of the policies that trump has outlined for working with the new republican congress that could help kroger? >> well, first of all, what we're really excited about and this would be for any administration is getting the economy to continue to grow. because, you know, growth helps everyone. so that creates jobs for all americans. and when people get back to work and get continuing to move ahead in a career, obviously they have more money to spend at grocery stores and everywhere else. so it's really all of those things. you know, one of the key things, i think, is creating stability and confidence to go out and spend and invest for the future. >> do you worry at all about unrest? the fact that we are seeing protests and that this country is still sharply divided? >> well, certainly if you look
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across the country there's still people strongly on both sides. but, you know, secretary clinton and president-elect trump both i thought made great speeches on starting bringing the country back together. and president obama as well. >> so let's talk about the consumer. it's been distracting, this whole election no question about it. and we've heard different reaction from different consumer companies, starbucks for instance talked a lot about the noise potentially impacting spending. what are you seeing in the lead-up to election and does it mean that we could see a boost now that it's over? >> we would certainly expect to see some boost now that it's over. a lot of uncertainty. people continued to spend a little bit more, but it was very fragile. hopefully a little bit more substance and strongness to it. customers tell us what they're really concerned about is whatever's in the headline. >> so how does that work
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exactly? the uncertainty weighs on big purchases at the grocery store and then once the election results are behind us what sort of boost do you see? >> they worry about all purchases. it's not just big purchases at the grocery store. and like one of the concerns that people increasingly talked about was health care. well, hopefully congress and the president will work together to make some stability and get some comfort with the health care system going forward and costs of that. things like that uncertainty actually flows through to all areas. >> rodney, for a long time we've been talking about food deflation, and certainly the expect is that would carry forward into '17. who knows for how long. now this whole week we've been talking about an inflation trade. does it make its way down to consumable consumables? >> well, we would certainly expect so. if you look at over the last 25 or 30 years, we've had three periods of deflation in grocery. this is the third time.
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typically it lasts from three to five quarters and we're in the middle of that proscess right now. you know, it's no fun, but you know, you'll get through it. and you'll continue to grow as you get through on the other side of it. >> but no expectation that this brings it to a rapid close? >> we would certainly not expect to because so much of our inflati inflation's driven by raw material prices and what type of growing season is out there for, you know, wheat, corn, soybeans, things like that. >> and this has weight on the stock, rodney, which is still down about 20% so far this year. sales have really slowed down since the last time we talked. is it going to be that end of food deflation that you're hoping turns it around? >> well, if you look we continue to have tonnage growth. so underlying you see that. once you start cycling a year, then you start cycling the deflation numbers from a year ago. so part of the change will just be the fact that you're not going deflation versus infla
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inflation. so we would expect growth broader than driven just by inflation. >> we've been talking a lot about e-commerce growth, it's singles day in china. i know you operate only domestically here and you've been investing in the click and collect program. what type of growth are you seeing online in groceries? and what are you expecting from the holiday season starting with thanksgiving? >> well, if you look at online it's been something that's been really important to us. we now have 531 stores with click lists in them. one of the things i always like to joke about is whatever number i give you i know it's going to be out of date because last week when we had our investor day it was actually 500. so tremendous growth. it's just one more way of letting customers decide how they want to shop with us versus us forcing them one certain way. >> what about this report that your competitor amazon is looking to get into the actual grocery store retail business? i think plans as much as 2,000 stores, is that a big threat to you? or is it positive in that it
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shows that online grocery isn't going to take over and wipe out the retail chains? >> well, sara, as you know, we're just so focused on understanding our customers and understanding their needs and making sure that we deliver against their needs. and competitors will do all kinds of different strategies, but what's most important, what our associates do a great job on is really focusing on that feedback from the customer and making sure we're delivering what they need. so that for us is really the critical thing. >> and finally, where are you on m&a? you've made a lot of big purchases in the last few years. there's been all sorts of rumors, speculation about whole foods. how do you look at m&a? and would you be looking to add scale in natural and organic? >> well, i'll give you the answer that we always talk about. we tell our investors, you should assume whatever's out there we take a look at it. we do not make a bid on very many things, but we will take a
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look at most things when it's out in the marketplace. and whenever we merge with somebody, we always look for somebody that can bring something to kroger as long as -- just like kroger bringing something to them. so if you look at a merger with rou roundy's, health, all of those things the list of things they brought to kroger is just as long as what kroger brought to them. >> we'll let investors ponder what the meaning of that is, rodney, thank you very much. good to talk to you. >> great to talk to you. >> the ceo and chairman of kroger in cincinnati. when we come back, liberty media ceo greg maffei, why he says president-elect trump will be good for business. take a look at stocks at this hour. and take a look at gold while you're at it suddenly down $32. back after a break.
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>> good morning, carl. that's right. i just got off the phone following the company's third quarter conference call. he still expects consumers to spend this holiday season. he doesn't think the election will change anything. when it comes to operating a retailer under the new administration, ellison says, look, we were prepared for any outcome because we felt it wasn't prudent not to put all our eggs in one basket. i consider myself a part-time presidential historian. the one thing for sure is that you have to just wait and see. most important thing for us is to support the administration that is an office. we have to be ready to respond to whatever policies are put through the house and senate. now, here's how ellison explains the large miss on comp sales in the quarter. he said we had an aggressive expectation to open 500 appliance showrooms before columbus day weekend, a significant undertaking. and we think that disrupted our business in those stores. but we think it was worth it to take those aggressive steps to be ready for october, which is a big appliance month, and the holiday season. but then our business took off once we were set, i made the
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decision for the long-term benefit. now, ellison also says jc penney has no record of one-third of the shoppers buying appliances having ever shopped at a jc penney store before. ellison says it's a customer that we haven't had before. it's a millennial, it's a homeowner, we are driving a new customer and we're driving credit like we've never seen before creating a new deeper relationship with them. now, on the challenge in women's apparel, ellison says the assortment was too career oriented, too traditional. now jc penney is pivoting to a more casual offering like the rest of america as we go much more casual, david. >> thank you very much, courtney reagan. well, yesterday at liberty media's investor day, i spoke with liberty media ceo greg maffei about what he thinks a trump administration will mean for the business community. and even more specifically for liberty media. >> i think it's pretty clear the trump administration's going to
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be pro-business. i expect some decent chance we'll have a tax deal, lower corporate tax rates, maybe some trade of bringing capital from overseas home for infrastructure spending as well. maybe we'll have slightly higher interest rate. see the market assuming that because of fiscal stimulus, but in general i expect less regulation and a fairly pro-business environment. >> yeah. and specific more to the media business? let's talk for example broadband pricing or net neutrality, more hands off fcc? >> the limited amount that i've seen about what president trump has tweeted or said on policies around net neutrality and the like have been fairly hands off relative to the current administration. >> yeah. except for the at&t/time warner deal for some reason. >> i don't know why that drew his ire. >> is there any situation you can imagine another potential player trying to make a move there? it seems unlikely. >> yeah. >> but we all know that viacom/cbs and/or the idea of a
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partner. >> first, i don't think there's another bidder. there could be. but i agree it could be unlikely. and second i think the deal probably gets done with some set of conditions. >> let's talk about the businesses of course that you hope to oversee at liberty. i want to start off with one that's kind of been a dog lately and it's trip advisor. are you disappointed in the performance of trip advisor? >> well, everybody would like to see the stock price higher, but trip advisor is going through a massive transition, it's actually the second, went first to a metta capability and now to instant booking. i think everybody knew that would have -- take awhile to take hold and it would be not without its challenges. but i think tripadvisor's heading in the right direction. it's a massive digital community. one that we're going to attempt to serve well and monetize better. >> and you're confident in the strategy? the execution steve coffer sat in that same chair earlier and we talked. >> yeah. >> he's talking about years and i think some investors i've
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spoken to like why isn't this happening more quickly. >> it takes awhile to move consumer behavior, to move from look to book mentality. but i think the progress will -- is already beginning to take hold and you're going to see the results before years. >> speaking of strong performance. of course sirius has been a strong performer. we always hear no shortage of speculation involving pandora. you've said, i think it would be additive to sirius' business, a combination, if pandora were for sale, is it something sirius would consider buying? >> we think that the free space, whether it be commercial, terrestrial radio or pandora is still a very attractive space and we'd like to talk about how to find a way to participate. i think the streaming business which pandora has doubled down on is very unattractive. so there's parts that we like and parts we'd have questions about. we've got apple, spotify, amazon, google, huge players who have other strategic benefits participating in that streaming
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music space. the revenues appear to be only headed south. the costs only up. i think it's a very tough space. >> formula 1. >> yeah. >> the latest addition to the liberty family. earlier john malone told me he loved the way that deal was structured and executed. and he specifically pointed out you. apparently you were competing. i didn't know this, against mike frees and david sadlov. >> we competed against a lot of people. >> are you happy with and why if so are you happy with the price you paid, which i think is about 18 times ebitda? >> we paid a price below where other investors have invested as little as three years ago and we understand where other bids were because we had a very attractive structure where we offer the existing shareholders both some current liquidity and upside in the future in betting on the business with us. so far it's worked. >> let's talk a little about charter. it's gotten to where you wanted it to be, but there are always questions of course about the future of the company. one of the key ones continues to be the unbundling that we're
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seeing. the directv now bundle, for example, came into the conversation recently. $35 for 100 channels, will it quicken the pace of people saying i don't need the video product anymore, do you think so? >> look, i think you're going to see some erosion away from video over time. there are many bundles out there and i think they'll have appeal to certain segments of the audience. i'm not sure we won't be beneficiaries of that as a distributor down the road. i think in the main charter has a great video upside. underpenetrated territory, lots of satellite, directv's probably worried about that part of it where our broadband pipe what we can do, our improved video product with all digital experience is compelling. and we will gain i think a lot of video share. >> but overall video subs are coming down. >> i think if you look that's going to come more from satellite than it is from cable. >> dish has had erosion, direct has had erosion. >> i think we've got upside. as we upgrade the time warner video product to an all digital experience, i think there's upside for us. >> people may forget of course
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liberty controls through a large extent sirius satellite radio, live nation, qvc, they own that significant stake in charter as well. and i'm forgetting some of the other names also, sara. but they do have -- formula 1 now. they have their hands in a lot of different pies. >> tripadvisor one of the worst performing s&p stocks of the year. >> it is. it is. i did do an interview with steve yesterday given all the news we had we did it on table e tape. we'll make that available on the web. all these interviews will be if not already available on >> i was just going to say what strikes me is the change in tone and sentiment. i know we talked about it all week long, but from big smart money hedge fund investors to ceos, we just talked to rodney mcmullen at kroger and you just heard it in your intervie, such hopefulness for what we're going to get out of washington. the common refrain when you asked these ceos about washington used to be our government gets nothing done, we have policy stagnation, we have
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sluggish global growth. it's amazing how much optimism there is now a president trump and a republican congress will have to get it done. it's a rosy deal. >> i think that's the key. if we'd ended up in a different place in the senate and it had been democratic, you might be hearing something different. but the idea that you obviously will see tax reform is one that i think many people embrace in the business community as a real reality now. and quickly. and the benefits that will come from that. certainly for those, i mean, liberty is more focused on not paying taxes than virtually any other company or being as efficient as possible. so certainly they'll embrace these kinds of things, although they already have structured so many of their deals in so many different ways to avoid taxes. >> high taxpayers and heavily regulated industries have high hopes. >> yes. >> when we return, speaking of donald trump, that trump victory bodes well for investors for now, says our next guest. why he thinks the future for markets though might not be so bright under the actual president-elect. pulitzer prize winning "new york
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times" columnist jim stewart joins us with some skepticism next.
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i'm melissa lee, here's your cnbc news update at this hour. secretary of state john kerry in antarctica for a two-day visit. he'll hear from scientists about the impact of climate change on the frozen continent. a huge explosion at the german consulate in afghanistan killed at least six people and injured more than 100. the taliban claiming responsibility. police said the attack began when a large truck packed with explosives rammed the main gate of the consulate. hundreds of people turned up in vancouver on thursday to protest the results of the u.s. presidential election. crowds voicing their opposition chanting, love trump's hate, and down with trump. canadian singer/songwriter leonard cohen died. he was acclaimed for seamless blend of spirituality and
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sexuality in songs like halleluijah and bird on a wire. he was 82. that's our cnbc news update at this hour. carl, back to you. melissa, thank you very much. u.s. markets hitting the pause button this morning on the trump rally a day after the dow hit that new all-time high. dow's up 3% since election day despite all those predictions that a trump win would translate into a big decline. our next guest says however that investors have been too willing to ignore the president-elect's hostile policy positions, which have the capacity to dampen growth. joining us at post nine, pulitzer prize winner "new york times" columnist jim stewart. jim, good to have you. happy friday. >> thank you. happy friday. >> immigration, trade. >> right. >> even deficit spending which the times looks at today are not the focus right now. >> absolutely not. i mean, can you believe that we're actually sitting here talking about a trump rally? after all the predictions where it was going to be a disaster. but people are looking at the near-term stimulus.
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they're looking at infrastructure spending, they're looking at tax reform and tax cuts and looking at deregulation. and those suddenly, you know, everybody woke up and discovered much to their surprise that we have a trump in the white house. and we have a republican house and a republican senate, which means all that gridlock for now is swept aside. and something can actually get done. and what the house republicans and the senate republicans want and what trump also seems to want is tax reform, is infrastructure spending and is deregulation. that's where they're going to agree. the danger things, which are really real here. i mean, the impact on the defic deficit, possible trade wars, which are serious issues, are longer term. a, we don't know if they're going to happen, and if they do happen the impact economically is going to take quite a while to work itself out. i think that's why the markets, investors see this as at least the glass half full if not more. >> interesting on the things you think will work short-term,
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infrastructure, tax, people say, oh, it's a done deal. those other things like immigration and trade, the answer sometimes his bark is worse than his bite, right? >> well, some of that may be wishful thinking. he's got to have some bite after this campaign, i would think. he's got to deliver something to the people voting for him over immigration issues. but that's not a slam dunk with his colleagues in congress. they have to really work out some serious policy differences there. congressional republicans for the most part are free trade and pro immigration, not illegal immigration. >> also fighting infrastructure spending for the last few years. >> they were totally hostile to it when obama -- by the way 10% unemployment was trying to get stimulus in there. totally against ilt. now we only have 5% unemployment and they're going to be all for it. i think we could all use some infrastructure spending. trump was absolutely right about the appalling state of the airports. i mean, and he lives in this area. look at new jersey transit, long island railroad, laguardia. i could spend several billion
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dollars easily right here in the tri-state area. >> what i like about the column, jim, is that you call out the individual analysts on wall street that got this totally wrong. they said in the event of a trump presidency the market would plunge. i think you say the barclays predicted 11% to 13% drop. >> right. >> in the s&p 500. this is exact same thing of what happened in brexit. >> right. >> and the defense from some of these groups is we haven't really seen brexit happen yet. well, we haven't seen donald trump in the white house yet. >> no, i don't want to be too hard because like we in the media i've been getting beat up all week saying how could you get this so wrong, but there was a lot of group going on, a lot of ek cochamber stuff going on. wall street analysts were not spending much time in the heart land of america either and they were looking at the same polls as everybody else. but i think they were wrong -- i mean, i don't understand why they ever thought it was so bad. to me the overarching thing is ungd say trade wars, this that the other, the important thing
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is donald trump is a real estate developer, he's a pragmatist and if he's got republican house and senate, this is on balance very favorable for investors for small business and for business people. >> to defend them a little bit, i mean, it's not just a trump presidency which seemed unlikely, but also control of the senate which certainly seemed in the balance more likely to become democratic. so suddenly not just with trump but a non-divided government. >> true. but they were also saying if we had clinton presidency and the democratic senate, we were going to get a rally. >> right. >> now, that i didn't quite get either. i mean, that would have made elizabeth warren one of the most powerful people in the country. she's still very powerful, but she is like anat ma to wall street. and how about the tax policy, zefb layers of capital gains taxes, that's not investor friendly. so this whole thing kind of baffled me all along. >> some are pointing out on monday and tuesday when it looked like clinton's win was
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secure, dow was up a combined 440 points. next couple days after trump won, another 400 and some odd points. maybe the market just wanted this to be done and democracy to function. >> well, the market historians i think point out something very valuable which is if you look at 100 years of market history in presidential elections, elections in the longer term have no effect whatsoever on the market because they are political events, they may over time begin to have some economic consequences, but they are political. they do not change for now the unemployment rate, the ghost domestic product, the momentum in the economy, consumer sentiment. all those things are what move markets. i wouldn't be surprised by the way if this sort of trump rally dissipates a little bit and typically you will get a bit of a pullback. it will all be a wash. we'll be back to where we were. >> sort of where we are -- we were 18 months ago that's for sure. >> that's true. >> jim, thanks so much. good to see you. jim stewart. as we head to break here, take a look at shares of disney. marching higher this morning
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despite reporting an earnings miss on both the top and bottom lines. results were impacted by those declining subscriber numbers at espn, but ceo bob iger did express some optimism about the net wok when he spoke on the call and with our own julia boorstin. >> our outlook for espn is very positive. we know we've got the compara e comparability factor in '17 due to the nba, but you're looking at a category live television sports that's generally very healthy. it adopts very well to mobile platforms, and that's where we're moving espn. so we feel really good about espn. we're dealing with some near-term issues on the subside. eyes wide open on that. not trying to -- >> we'll look at disney and alibaba breaking records. we will take you to singles day straight ahead.
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stocks. so on trading nation we ask is the huge move in bond prices finally about to end? go to to find out. more "squawk on the street" coming up.
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the dow is down about 28 points. the bond market is closed but we are going to check in with rick santelli in chicago for the santelli exchange, what a week it has been in the bond market, rick. >> absolutely, sara. like to welcome my guest on veterans day. >> happy veterans day. >> we all need to think about freedom of speech, all the things that many of us take for granted every day. there was a high price for that. so thank you all, all you veterans out there. jim bianco, today when i at 10:00 eastern i brought up university of michigan and the number bounced a bit. but that's not really the point. the one-year inflation outlook was 2.7. that's the highest level since april of this year to find a higher level. and five-year outlook also 2.7 you have to go to july of '15 to
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find a higher number. i confirmed with university of michigan it was my guess, but we don't guess. it's all about facts. the polling was done before the election, okay. your thoughts. >> there's a real fear that inflation or hope in some cases inflation's moving higher. unit labor cost, basic measure of wage inflation 2.8%, highest level since the post crisis period since 2007 that you're starting to see some movements on that. copper, potentially having one of its best weeks in 30 years right now as the way that it's been roaring higher. what you've got -- >> gold, silver. >> yeah. what you've got in markets is a reflation trade going on big time. stocks are going up. yields are going up. >> which had its legs before we learned who the president was. >> it started on monday. it started on monday that stocks -- and the dollar too is rallying as well, too. everybody's in this hope that we're going to get a reflation in the economy. >> now, listen, trump called it a movement. and this movement's composed of a lot of groups.
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one of the main groups whether it was tea party, freedom caucus, worried about debt, worried about overspending, worried about aum the issues that effect kids and grand kids, but there may be an issue to find positive news. i was working on an old car, i'm a car guy, i didn't know the carburetor was broke, i started using ether, that wasn't working. it was only starter fluid, only ether, would run awhile but wasn't getting any gas. you know, infrastructure spending, all these debt issues, but if they're followed by quick results on some tax reform, obamacare, you know, making it competitive interstate competition, this low hanging fruit could give us the gasoline that, yes, we're using some primer but the engine might start to run, thoughts. >> absolutely. you know, we thought that gridlock was good. we thought that that's what we want in markets. maybe we've gotten to the point now where we actually need a one-party system to push through
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some reforms like tax cuts, infrastructure spending, cutting of regulations to kind of get the economy moving. it's been stagnating in the slowest post crisis growth that we've seen. >> are people childish to think this could get done rather quickly? >> i think there is some hope this is going to happen right away. >> i know where the e anywhere shis going to come from. >> trump has a 100-day contract out there of what he wants to do. he's got the congress, the senate and the house to effect all of that. >> paul ryan, don't pick fights you don't need to pick. they've worked and worked on these things they couldn't get through whether it was senate or white house, these things are for the most part memorialized and ready to go in large part. >> exactly. let's keep in mind too while we've talked about what the hope is, there's also the fear on the other side. the peso had its worst day since 1995. it's still above 20 on the fear we're going to rip up nafta.
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china's going to be declared currency manipulator. we could also be walking into a trade war that could undo all of this if we're not careful on the other side. >> we need to see how everything's going to proceed. hopefully he will put people around him that say, listen, these are promises you made but do the low hanging fruit first humming. many would say some of these better deals are good in the medium and long term, not the short term. get the short-term prices up, then do that. >> absolutely. >> we're out of time, jim. we could go on for a while. sara, not a lot of people down here but there's always fun discussions. back to you. >> such big market moves this week. so much to talk about, rick. thank you, jim. good to see you as well. let's send it over to jon fortt with a look at what's coming up in the next hour on "squawk alley." good morning. >> good morning, sara. there has been a divergence. tech has not performed nearly as well as financials and some industrials. what should we read into that? also, beginning to read the tea leaves on tech policy in a president trump administration.
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who's up, who's down and this eric schmitt thing about hbb1 visas, is it possible? all that and more coming up on "squawk alley." hey nicole. hey! i just wanted to think your support team for walking me through my first options trade. well, we're all about educating people on options strategies. i won't let this accomplishment go to my head. get help on options trading with thinkorswim, only at td ameritrade.
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the presidential election. as you can see there. perhaps the idea of a more hands-off federal communications commission, one reason that stock is up. consolidation always a part of the media landscape and perhaps the prospect of more of it coming may also play into it. yesterday sitting around john malone, who knows his way around a takeover or two, i is asked him about the prospect for cable companies and wireless companies getting together. >> i don't know who buys who or who starts what, but i know from my experience in europe and latin america that there's big synergies in combining the two networks. we recognized this some years ago, as we've done these deals. we've built up meaningful market share, but at some point you say, this is an important part of my business. i really need to own enough
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control of it that i can integrate it across both networks. >> that's the key question. we've seen deals done by both charter and comcast with verizon for these mvnos, but is it enough or do you need the economics that come with ownership, sara, was the key question. he seemed to be answering in the affirmative or saying you need at least more, not necessarily full ownership but more. we watch 5g, this next generation of wireless, it will take a while but that could get broadband into a home in a wireless fashion. that would really upend things. >> this whole m&a, recalibration under a trump administration, one of themes we have been watching. this market has been a story of a different makeup for a rally. if you look at some of the gains this week, and today we're taking a pause, clearly, but so far this week financials are up about 10%.
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industrials rallying hard. there's been this great rotation out of some of the winning stocks like technology and the high yielders like staples and telecom and utilities and to some of these other sectors that are considered trump winners. >> not to mention on antitrust, again, a light touch expected, consolidation certainly becomes even more likely if you don't think you're going to face opposition. >> consolidation, deregulation, part of the themes we're watching. dow still on track for its best week in five years. that's going to do it for us on "squawk on the street." much more ahead on "squawk alley." scott walker will be sitting down with jeffrey gundlach. his take on how president trump will impact the markets with his big jump in rates this week. also, he predicted a trump victory. when growth presents it? american express open cards can help you take on a new job,
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don't forget to thank a veteran today as we honor those who have served in the armed forces. welcome to "squawk alley" on a friday morning. got the whole gang here at post 9 on an interesting day. dow's down 44, s&p is down 11. gold's down $32 as we take stock of the week we've had, the election, all of those positions, those hedges, the defensiveness that is being unwound today. mike, you made this point over and over again, the policy prescriptions that we think the market is reacting to are long-term stories. >> they are. i think this release of tension was definitely something you could perhaps see coming just with resolution of the election. it was tremendous concentration of defensive hedges surrounding the date of the election. so once that gets released, but the way it got manifested, the way the money flowed through the market is something very policy dependent. >> take a moment and watch the president lay ta wreath at the tomb of the unknowns.


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