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tv   Power Lunch  CNBC  April 10, 2019 2:00pm-3:00pm EDT

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republican senators seem to be polling support for cain fed minute is about to be out. all right. thank you very much. welcome to "power lunch" i'm tyler mathisen we have breaking news from the fed. literally just seconds away. the markets slightly lower right now. yields on the 10-year. let's go to steve liesman with the latest >> they say the majority likely warranted say the interest rates unchanged for the rest of the year the majority thought that the economic situation warranted leaving interest rates unchanged for the rest of the year several participants say the target range was close to the long run neutral level and several note tharg view on the right target range could shift in either direction. some, those expecting better growth say it could warrant a late hike later this year. the majority says unchanged but some think it could warrant a rate hike later. there's no comment from any
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group saying they have to cut interest rates a couple underscore that patient regimes should not limit policy moves when appropriate moving along here, i'm sorry, one second say time is needed to assess if the weakness in the first quarter spills to the second quarter and there's uncertainty around trade, around brexit, around spillovers from the weakness in europe and china participants generally expect slower growth due to foreign growth problem, waning the effects of fiscal stimulus and less boost than expected they expect a strong consumer but continued softness in the housing sector was a concern sustained expansion, strong labor market and inflation trend, but several were concerned about the low level of the yield curve which was not quite flat they were concerned about it some noted other factors like the low level of term premium.
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and concerns about high levels of corporate debt they said warranted monitoring >> steve, thank you. you're going to stay with us as we bring in a panel. bob, floor of the new york stock exchange, steve, director of institutional sales, and rick santelli in chicago. bob, let me begin with you if i might. it looks like the market had kind of a yawn coming out of the minutes. >> well, two or three ticks up on the s&p any hope that there might be any kind of rate cut in the year is going to get the markets going a little bit if you look at the fed fund futures, there's hope further out there might be a rate cut. and steve intimated there were a few who held out the possibility. the key here is the references to the global growth issues. that's what i wanted to hear about. uncertainty around trade, slower global growth in general the waning effects of fiscal
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stimul stimulus it's important i think the way the market's been reading this, a lot of people think the waning effects ant the way to look at it. the chinese are gearing up for fiscal stimulus, and tyler, that's one of the reasons the market that be holding up so well global central banks have their back >> santelli, your reaction some comments about the low level of the yield curve the flattening of it >> you know, i think that it's like an open book exam in college. the markets pretty much studying what the fed's done and the fed's studying what the markets are doing. i agree with bob there isn't much to disagree with from the perspective of those i rub shoulders with every day. the fed is going to be patient they're going to monitor data unlike the white lie of the past but maybe more importantly, very few down here really know what the next move is going to be it's split equally between an ease and a tightening. which i think reflects a very
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kind of floating notion of how the economy will move. nobody suspected we'd have such an aggressive first quarter. i think that may have changed some minds that were looking for an ease before a tightening. but i do think as you look at the economy, there's no doubt that the u.s. and the globe are slowing. so the fed's got the perfect seat right now the dot plots, don't pay attention to them. pay attention to what jay powell says he says pretty much what was reflected in the first couple sentences of those minutes >> and steve brasso, if i could go to you quickly. is the fact that the ten-year yield is drifting quickly, is there any kind of head wind for the stock market or is it just a blip >> yeah. i mean, i think the yield curve is -- that's the issue right there. the yield curve is spread basically of anywhere between ten basis points to 20 where smack in the middle of that, i believe the fed, these fed minutes did what the market
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wanted it to do. there was basically a lack of volatility or volume during the course of the day. the fed did just enough in back ward-looking statements to keep the market sort of steady. now we look forward to earnings and we'll see what that lies in. guidance, we all know the world is slowing we all know we're slowing. let's see what earnings look like that's next natural progression for the markets to focus on. >> mr. liesman >> i was going to point out what rick said. when you read the minutes, the fed is very aware of what markets have been doing. and the idea that there's been something of a comeback, i think you're right, rick it took the foot off of what might have been the accelerate that maybe there was going to be some kind of leaning toward the move if you read the minutes, they're full of the idea markets have come back smartly. largely they think because of the shift in federal reserve policy what you have here is a committee that's firmly in the middle to the extent that
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anybody's leaning, they're saying maybe there's an outside chance of a hike but there is not that outside chance of a cut. there's no group in there that you can see or that's mentioned or explicitly mentioned that looks for a cut later this year. >> and did i hear you say, steve liesman that a majority see no hikes this year? >> yeah. that's i think the lead of our minutes here that majority say it's unlikely that -- that theeconomy is likely to develop in a way where rates do not change at all >> and did i also hear you say that the feds cited the waning effects from fiscal stimulus and they were a little surprised the economy didn't get more boost from the stimulus that did occur last year? >> yeah. tyler, i was going to say a lot. i didn't say it, but now i'm going to say it. the fed is disappointed by some responses in the economy they're clearly disappointed by the reaction of inflation. hasn't reacted the way they wanted it. the way they thought it might. and i think they're disappointed as well in the fiscal stimulus
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there's a comment in there that the fiscal stimulus did not, is not providing as much of a boost as they expected >> rick santelli, any reaction there? go ahead >> yeah. my final word would be i agree i thought there would be more longevity to tax reform and stimulus, but it runs into the intersection of all the open trade issues and i am sure there are participants of the fed that will acknowledge that even though it's not underscored in the minutes. many traders believe that you could get more of a stimyoulative effect once we know where all the pieces are on the global trade chess board >> that's what they said today it's important he thinks just the threats of all of the tariffs are undermining confidence around the world. they've talked about the tariffs themselves he upped the antein terms of concerns of the effects of the
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threats. >> did you -- >> the broken clock is right twice a day. >> the minutes again address the first quarter weakness issues which you talked about for many years. they said the weakness is not expected to persist and much of the softness is due to temporary factors. again, we've been talking about that first quarter phenomenon for a while now. >> gentlemen, thank you. we'll leave it there steve, bob, and steve, rick, thank you. >> sure. treasury secretary steven mnuchin speaking to us moments ago. it was a wide ranging interview that hit on trade talks, tariffs, the health of the economy and the fed. sara eisen rejoins us really from washington with some of the major highlights >> reporter: as far as investors are concerned, really eager for an update on the trade talks which the treasury secretary gave us. he said the call last night from the chinese premier was productive and said he wasn't willing to commit to a timeline when i asked about the president's four-week period three weeks from tomorrow.
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but he did make some news in saying that they have reached some sort of agreement on how they're going to enforce this whole trade deal listen >> we've pretty much agreed on the enforcement mechanism. we've agreed both sides will establish enforcement offices that will deal with the ongoing matter this is something that both sides are taking seriously >> secretary also told us there's another call scheduled for tomorrow morning said they are alternating nights and mornings due to the time change in china. and they're making progress, but wouldn't also comment on whether tariffs would go away if that trade deal is done now, the other big topic of conversation, of course, the economy. he says the u.s. will continue to outgrow the world wouldn't say that the federal reserve should cut interest rates as the president has advocated for by 50 basis points he respects the independence of the fed. i did ask him whether he felt that he chose the wrong person because his boss, the president,
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seems to dissatisfied by jay powell >> i don't feel like i picked the wrong person i respect the president's views and his views of the economy where he's had tremendous insight. >> what would you say to people worried about the independence of the federal reserve with some of the proposed nominees steven moore and hermann cain? >> i don't think there's any reason to be concerned about the independence of the fed. it's the president's right and obligation to nominate people to the board. these are two people that the president has confidence in, and they'll go through the normal senate confirmation process. >> he said he knew steve moore better than he knew hermann cain the overall message is when global growth is slowing he said the u.s. continues to shine. >> thank you so much, sara ei n eisen. let's dig into the comments and reaction with brian gardener, managing director at
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kbw, also stephanie miller is with us. welcome to you both. >> thank you >> stephanie, first to you what was the most important takeaway from the treasury secretary's remarks? >> what investors really wanted to know was any little nugget about those chinese tariffs and whether or not they might go away sometime soon and so what we learn second down we still don't have an answer on that not really surprising. but any sort of mention around the easing up of those tariffs would be welcome by investors who are just completely exhausted of watching this whole thing. >> why do you think it is that he could have said well, yes, of course when we reach this agreement, those tariffs were lerchged to come to this agreement, but he specifically did not say that. so is the conclusion that those tariffs will persist >> i think that's one of the biggest parts of negotiations, obviously, in terms of the leverage here. there's clearly things that are not completely worked out otherwise we'd have a deal at this point
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why make the announcement until the whole thing is done and also let the president make the announcement >> right as far as the market is concerned, one major issue, head wind for growth or for some consumers and businesses could remain the treasury secretary said this deal -- i think he said the most significant deal between the u.s. and china in 40 years the opening on that front or maybe the reassurance about kplek chul property and otherwise do more to help the u.s. economy than the potential hurt of tariffs remaining on >> yeah. i think it's asymmetric. i think the removing of tariffs at least will boost the markets more than -- let me back up. i think the removing of the tariffs will help the markets. the removing of the tariffs helping the economy longer-term, probably is a good thing but the intellectual property
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component of the negotiations really over the longest term is the most significant you have the short-term tariffs which are -- if you get rid of them positive. longer term, if you talk to u.s. businesses, the thing they're most concerned about is the intellectual property protection and technology transfer, theft that comes from china. so i think that's a bigger issue for the economy longer term. >> stephanie, talk to us a little bit on the one hand china tariffs may go away, but new tariffs may come in place on european goods. and also nafta or the -- not nafta, i should call it the u.s. mca, that is no sure thing in congress, and that could create some trade headaches as well >> exactly and we heard secretary mnuchin tell sara that pelosi needs to bring this to the floor. this being the u.s. mca, that the administration has negotiated this deal with mexico and canada and why can't the house just start voting so the congress can ratify this
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essentially? and investors are now familiar with this administration's negotiating tactics. if they don't get something they want from another country, they'll threaten tariffs or some other punitive actions in the business community and investors don't like, and while they may want to shrug it off and say this is how the administration works, we saw a sell off at the end of the day with the threat of the new eu tariffs yesterday. it's ongoing uncertainty it's not the investor's friend >> brian, i realize the hearings are underway that's the parallel issue on the hill today as we stand so far, do you think there's any real headlines or any policy moves that are likely to come of this? >> no. i think today we're just seeing a lot of political noise a lot of political grand standing the issues that have been covered really are not related to bank regulatory policy. those were the few exception questions on regulatory policy
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if you -- if investors are looking for changes in the regulatory environment, it's really a post 2020 event the administration's regulatory agenda remains in place despite the rhetoric from the hill until the election, and, of course, if the president's reelected, then it remains in place and democrats really are not in a powerful position to change that so it's negative headlines for some of them it's embarrassing moments for some ceos when they're placed in the spotlight. but at the endof the day, to answer your question, policy does not change, and i didn't sense any shift in the debate today that would signal a policy shift. it's all political noise >> all right guys, thanks brian gardener, stephanie miller, appreciate your time >> there was a lot of noise, wasn't there >> it's still going. numbers are trickling out about the size and scope of uber's ipo we'll get you the latest on the valuation and targeted ipo price
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next of course we're monitoring the hearing on capitol hill. it's still going on. big bank ceos questioned by members of the house financial services committee it is politely put, a deanngerofs questions. power lunch will be right back one-millionth order. millionth order. ♪ there goes our first big order. ♪ 44, 45, 46... how many of these did they order? ooh, that's hot. ♪ you know, we could sell these. nah. ♪ we don't bake. ♪ opportunity. what we deliver by delivering.
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to go public leslie picker taking a closer look at the staggering amount of sock the company plans to sell in its ipo and diedre is in san francisco with new details on how the company will expand its footprint. leslie, you go first >> tyler, this is looking like it will be the biggest tech ipo in almost five years a source close to the company tells me this deal should raise about $10 billion. that would make it the biggest offering since alibaba listed $25 billion worth of stock in september of 2014. uber is expected to reveal its ipo propespectus as soon as tomorrow tomorrow's disclosure will accelerate the process toward uber becoming a public company this will put it on track for a may debut, early may with a listing on the new york stock exchange that time line is subject to change based on market conditions a 10 billion float will imply
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valuation around $100 billion. that's around 20% less than the 120 billion uber initially was reported to have been seeking. expectations on valuation has been par for the course since lyft debuted that company slumping to record lows today if the moves continue down, it may impact the price by which investors are willing to pay for uber and other ipos as they come down the pike. >> look at that, leslie. lyft is just over $62. that's a 7% slide just today you said may is the ipo timing for uber let me quickly throw this lyft question at you before you go. the lower it goes in this early trade seems like the more questions that's going to raise about whether the company had the right approach or whether the underwriters did or finger pointing at some of the early people who got the allegation, and what lessons is uber going to go name by name and make sure
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every person who is going to get a piece of the ipo is a long-term holder >> that's a good question. it's clear uber was watching lyft's ipo and taking any potential missteps as an opportunity for themselves now, some of the volatile trading, at least according to sources close to the lyft camp was based on things that they would say is out of their control. for example, all the speculation surrounding short-selling. there were analyst reports that had bearish characteristics about this company and today's slide could be partially due to some of the news reports that uber is imminent and investors are clearing the decks to make sure they have cash on hand to really pile in for an allocation for uber's ipo which $10 billion worth of stock is a lot they need to sell it could be a variety of factors, but yes, it is very clear that uber has been paying attention to what went on with lyft >> i just did back of the envelope math.
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that's a 29% drop if you bought lyft at your first chance of 87 at the ipo let's talk about uber. it's expanding the presence in a key overseas market. diedre has the details >> reporter: that's right. today uber is announcing it's expanding the scooter to paris it continues to build the preipo narrative as it gets ready to pitch wall street. the ceo has said he wants to be the amazon of transportation so e bikes and scooters and the expansion to paris, its largest european market is part of the last mile push it has spent hundreds of millions of dollars acquiring jump and investing uber is also betting on autonomous driving it's advantaged technologies group betting on air travel. food delivery with eats and so
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on i won't run through all of them. of course, guys, all of these bets require a lot of investment and ride sharing alone is a pricey money-losing business we'll get a better idea of how uber burned through 1 $.8 billion last year and how all these businesses will affect its path to profitability which will be a key question for investors. >> all right dee deirdre, thank you representative brian steel of wisconsin talking to the bank ceos on capitol hill about the current ipo climate. >> private equity has gone from 5,000 to 8,000 it's good you can raise capital in the private markets you can stay private longer. there are things which are driving it out the cost of the much higher risk of litigation for public companies, a shareholder meetings have have become a
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waste of time. if you speak to any person who ran the ceo of board member of a public company, now in a private kpaenl, they'll tell you we spend all our time on better products and better services, strategy, risk forward looking and very little bit of the time on check the box presentations. the cost of litigation in this country is much higher and we have one of the best legal systems in the world if you travel the world, our rule of law is exceptional there's a litany of things driving companies private. jpmorganchase is owned by 100 million americans one way or another. pension plans, municipalities, veterans we feel a huge obligation. i would love to be private i can't. >> thank you >> i think mr. diamond talked about the growing cost of being a public company the cost and the friction that's associated with being a public company has only grown at the same time, the availability of capital
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privately has expanded very significantly. if one of the primary reasons a company goes to the public markets is for access to capital. if that capital is available privately and you can operate your business privately, and the cost and the burdens of being a public company continue to rise, the incentives to be a public company are very low and so that's one of the reasons why you see companies waiting longer and longer and longer to go public. so if you wanted to do something that would change that over time, we have to find ways to lessen the burden of being a public company i think the availability of private capital is something that's here to stay. i don't think it can be reversed as good for the system >> thank you anyone else? mr. gorman >> there are many changes suggested here just take the quarterly reporting of public companies. we're all about to enter our earning season and working on earnings reports the problem is quotas come
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around every 13 weeks. it doesn't make sense. you investors, the public, regulators, legislators did not learn a lot by having that kind of burden on a company that's just an example it's seeking perfection in the place of what is practical >> thank you for your time today. i yield back >> the gentlewoman from virginia is recognized for five minutes >> thank you and thank you to the witnesses for coming today it's been a long day i think we're starting to see light at the end of the tunnel here i want to switch gears and talk for a minute about the fed and as you all are probably aware, steven moore is under consideration for appointment to the board of governors of the federal reserve. and i want to talk about that for a little bit so mr. moore has taken a series of controversial stances about the fed despite acknowledging that he still needs to learn more about how the regulator works. he previously said that the fed should be scrapped in favor of
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the gold standard. he called on the fed to hike rates during the great recession because he believed it was necessary to get less dollars out in the economy, that that was a good way to deal with it those are his words, not mine. and until recent -- recently he said that fed chairman jerome powell should be fired for rate hikes or rate increases in his opinion that diluted the tax cuts this is yes or no going down the panel. do you think the fed should be scrapped in favor of the gold standard >> no. >> no. >> absolutely not. >> no. >> no. >> no. >> no. >> thank you now, i know that all of you were working in the financial services sector during the great recession. even knowing what you know today and knowing what you knew then, do you think that a better way
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to deal with the great recession when it first -- at the onset would have been to hike rates and constrict dollars in the economy? >> i do not. >> no. >> no, not at the time of the great recession, no. i think that would have been terrible >> no. >> no. >> no. >> no. >> and final question on the fed issue. would it give you -- does it cause you concern that someone who holds these beliefs is being considered for appointment to the federal reserve? >> i don't know the candidate. >> i'm sorry the question was are you concerned that someone who has these beliefs is under consideration for appointment? would it concern you to know >> i would have to see all of the beliefs of the candidate
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>> i want to start by saying i have enormous faith in jay powell and the lot of the fed governors. this is not a traditional choice i don't personally know them i see them on tv i don't personally know what they think i think that's why the senate has confirmation to see how they act under certain circumstances? >> it would give you pause if -- >> if they believe that, yes i'm not sure he believes that. >> i believe in the independence and integrity of the fed i believe in the role of the legislative body to properly vet candidates for it. >> i'd agree with mr. gorman >> we have the best central bank system in the world, and i think it's up to the confirmation process to vet this candidate. >> i agree with mr. gorman >> i have faith in the confirmation process >> so based on that, i do have one more question about this
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issue. is one of the things that has really made the board of governors and the fed function so well is that it is for the most part devoid of politics that politics don't factor into that at all? would you agree with that statement and would you be concerned if politics were injected into the office >> the independence of the central bank is integral to the credibility. >> absolutely. it's a tough job to do enough as it is. it should be clear of politics i would not say that's always been true. >> politics does impact it one way or another because you have fiscal policy through the executive and legislative branch, and you have monetary policy through the federal reserve. there's some interaction, but generally aiming for maximum independence is obviously the gold standard. >> independent fed is critical to the success of this country, and you can observe countries
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around the world without an independent central bank and what happens, and it's generally not a good outcome at some point. >> independence of the fed is a relatively recent phenomenon, and i think the fed has been better because of it >> i do believe that an independent fed is best for this country. >> strongly support a very independent fed. i agree with the comment politics have an influence, but we should make it as independent as possible. >> thank you very much i yield back >> thank you the gentleman from virginia is recognized for five minutes. >> thank you you have another virginian i apologize about that >> we're going to talk more about these hearings which have been very wide ranging everything from executive pay to their views on climate change to what you just heard which is about the independence of the fed. to discuss with us is jason goldberg and analyst at barclays jason, good to see you welcome. >> good afternoon. >> what have you heard today that has stood out for you not
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so much as a piece of political theater which we can i think all agree this is. but in so far it would effect your view of these company's shares if anything >> i think it was most interesting to us that during the testimony on a couple instances the ceos were asked what they think the biggest risks to the system are. they cited cyber risk and slowing global growth, particularly china and they talked to the growth in the shadow banking and business and student lending. they continue to focus on those as being risks to the stocks >> it was almost unanimous when they were asked about the biggest risks. so many of them, in fact, let's see here i think it was one, two, three, four four or five of them said cyber. is that how you see the biggest risk
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>> it is it's high on the list. it's a newer risk. something difficult to quantify. these banks are attacked on a daily basis and have to continue to defend themselves and have done a good job in that arena, but it's something that continues to evolve. you have to pay attention to it. >> jason, one of the inconsistencies just on display is is the fact that part of the day was spent with democrats in particular who are leading this hearing, attacking the banks whereas we just saw in that line of questioning from wexen, she was using the authority of the banks to attack president trump'snominees to the fed board. they're not even consistent on whether this hearing is meant to go after the banks or meant to explore their business models, and reflect on what's changed since the financial crisis >> yeah. no, there's been a whole host of issues throughout the day. and mind you, it started at 9:00 in the morning it's been going on quite some time these banks have tremendously changed their stripes since the financial crisis record capital record liquidity
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they've done a good job at improving their franchises and always more to do. but yeah, no, they've been all over the gamut at this hearing >> and the banks since the financial crisis have been amazingly profitable as several of the representatives said. as you process today's fed minutes and the likelihood that interest rates are going to stay roughly where they are, doesn't seem like there's any big move to raise them this year or to cut them this year how does that impact these banks and their franchises and who, which, i should say, which one or ones seem best positioned to take advantage of that interest rate regime? >> it's interesting. toward the end of last year, i think general expectations were two, three, four hikes, 25 basis points during the year now we're essentially at zero. the fed eased into that stance today's minutes not a surprise the sfri has benefitted over the last several years over a rising
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fed hike lack of fed hikes puts pressure. on the other end you've seen deposit betas lower than expected banks have not raised the costs as thought and loan growth is good. one of the things you'll see from the banks this week and next is you'll see decent loan growth both the factors should compensate for margins that don't expand as much as anticipated and allow the banks to grow. >> what are your three top choices among the banks on display today? >> today i would say jpmorgan and citi are the standouts today. generally we're constructive on the group. giving your view despite the changing rate and backdrop, we think the backs continue to grow earnings and book value. buy back a lot of stock and continue with positive operating leverage >> jason goldberg, we speesht it ahead on power lunch, is
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pinterest management too nice for wall street? we'll explain and all the details ahead of disney's investor day tomorrow when power lunch returns.
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hello, everybody here's what's happening right now. scientists revealed the first ever image of a black hole they assembled data gathered by eight radio telescopes around the world to show a violent neighborhood near a super massive black hole >> we're delighted to be able to report to you today that we have seen what we thought was unseeable. we have seen and taken a picture of a black hole. here it is >> now, what do we do with that? the iranian president slammed the president's decision calling it an act of propaganda and warned the u.s. would face tragedies if it goes beyond words. he made the comments in tehran iran has labeled the u.s. central command a terrorist organization in response nikki haley has a book deal. her book will come out this fall it will be about her experiences
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as ambassador and her six years before that as governor of south carolina that's your cnbc news update right now. >> thank you the oil market closing for the day, and dominic chu is all over it at the commodity desk. >> oil prices catching a bid the emergency department's weekly inventory report. oil inventories rose to their highest level in over a year 7 million barrels. more than the forecast inventories fell by 7.8 million barrels. one of the big reasons gasoline futures are rising here you can see three and a quarter percent to the up side >> dom, thank you. shares of tesla higher today. lawmakers introducing a bipartisan bill to expand electric vehicle tax credits we are joined with the details
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with phil. i thought we might be moving higher >> they should be moving higher. this would be a benefit for tesla and general motors but for the auto industry it brings people into the showroom potentially to buy an electric vehicle. it's a bipartisan proposal brought in on the senate saide. $7,000 federal tax credit. in other words, you buy an electric vehicle, you get a $7,000 tax credit. you can put it into your federal tax returns. this would apply for vehicles up to 600,000 in sales right now the current expiration is 2 00,000 vehicles right now the incentive at tesla is winding down. this would boost it back up to $7,000 who might benefit? tesla, currently tesla if you buy a tesla, it's a $3750 tax credit it's already been cut in half from the 7500. so that goes down.
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it's eliminated completely at the end of this year unless there's a new law that's introduced clearly you see the benefit for tesla. general motors currently gm buyers, eb buyers currently get the 3750 then it goes down to 1875 in the fourth quarter and after the first quarter of next year, it gets phased out unless the introduction of some type of further incentive. take a look at e electric vehicle sales last year. tesla was ahead of everybody in the united states primarily because of the model 3 sales that were boosted by production last year and people wanting to get in before the incentive expired. guys, this has a lot of attention whether or not this actually passes in washington. it would be a big benefit for auto makers? >> either they think it's a small chance or not important to the business phil, thank you. the shares on tesla are up 1.5%. not a huge move. just about a week before
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pinterest is set to go public. our investigation is revealing details about how the workplace culture is hurting growth. that's next.
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welcome back we're watching shares of lyft today which are trading at the lowest levels since the ipo nearly two weeks ago they're under 62 now they've fallen nearly 9% this is down from over 62. just a couple minutes ago. again, difficult one for lyft which opened first for the retail public at around $87 a share. now, all of this with the ipo rush continuing has pinterest gearing up to go public next week there's an eye opening piece about how pinterest friendly culture is hurting the company's growth with us is the reporter behind the article. sal, welcome >> hi. how's it going
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i spoke with -- >> let me just sort of flesh this out pinterest has a culture that was supposed to have people employ in pin employees the ceo wanted to make sure no changes were made so quickly they alienated the core users. the result it sounds like from your reporting is instead employees were afraid to ever confront or criticize any decisions that they would nod along in meetings and later say we don't like the sound of this at all and they became difficult to make any changes whatsoever >> that's right. i spoke with 20 former pinterest employees. they told me that the company is riddled by a passive aggressive culture where the emphasis is placed on being nice this is contrasted with other companies where it's encouraged to be direct and at times cut throat that didn't really work out too
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well at pinterest. although, folks are nice to each other, there is some very slow decision-making, and there is a lack of commitment to strategy so they haven't been able to really capitalize or innovate on new projects >> yes i thought your anecdotes about how they were wary, especially the ceo onvideo and embracing that and all maybe that's been a head wind. you had an anecdote about a coke meeting where they were meeting with the company and trying to develop a strategy, and no one wanted to speak the truth about what the right strategy would be has this changed, sal? is the company today a different company than it was a couple years ago? >> what i'm hearing from folks who left more recently is that the company still has these problems in 2016 they actually tried to do a campaign internally to get folks to be more direct. they put posters all over the company saying say the hard thing. but as recently as the last couple months, that still is not the case there is still emphasis on
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making more and more meetings, getting buy in from all departments. it's just really as one of my sources that i spoke with put it, just kicking the bucket down the road >> so they know they've got an issue, sal >> they know it? >> they do know, but at the same time they consider it a strength as well. they aren't rushing into new innovations. they're not putting out new features and that hurts user growth and the ability to grow revenue. they're not rushing into scandals that's been a big problem for other companies line facebook and uber >> quickly, where does this culture originate? with whom? >> this is from the fact that the co-founders are exgoogle and exfacebook employees when they left their previous employers, they wanted to create a world-class progressive culture. they wanted to make it so that they could attract top talent but also just kind of change the way that things are done in silicon valley >> they were reacting to what
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weather they come from as much as anything else sal, thank you sal rodriguez. all right. disney expected to reveal details about the highly anticipated streaming service at the investor day tomorrow. what's at stake for disney's growth coming up.disney's growth coming up and we're closely watching the big bank ceos. they are getting questioned. i avoided the word grilled because every time you to go capitol hill, grilled is the verb it's been a marathon we'll bring you thbie g headlines. "power lunch" will be right back
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welcome back markets holding steady today but the communications services sector is looking to close at a 52-week high led by the likes of discovery, at&t and disney disney has been one of the laggards in the group. disney is expected to unveil details of its new streaming service. some are worried about the numbers they may talk about. julia boorstin joins us. >> what investors want to hear is how much the service is going to cost and a little more details on when it's going to launch bob iger said a launch by the end of the year, late 2019 exactly when and for how much? he said less than netflix.
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$5, $6 or $8 i think what tomorrow is going to be about is bob iger showcasing the breadth and depth of disney's brands and library marvel, disney, star wars, national geographic. avatar disney will show these are the iconic brands if you have a family, little kids, you'll want to subscribe to this the other thing is this is going to be movie theater quality content. there are going to be stars from the marvel universe that are going to be making shows and films that you'll only be able to see on disney, on disney plus it's going to be something you won't be able to get anywhere else they'll be trying to convince people it's worth subscribing to this in addition to netflix and all of your other things >> talk about the avengers and this movie "end game" which is blowing through box office records. knocking out "star wars" franchise. >> "avengers end game," this is the end of the avengers
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franchise. they may come back with these characters later this is the second half of the avengers infinity war movie. i don't know if you watched the first one. >> was the first one three hours long >> it wasn't quite as long it will be three hours long. presale numbers have been through the roof it's not only broken records but it's sold more than a bunch of these other movies, including "aquaman" and "avengers" and "last jedi." $300 million opening weekend but it was three hours long. one thing funny here usually movies that long have a hard time hitting huge numbers opening weekend because there are only so many times theaters can show them. so many want to find out what's going to happen to these characters, it's going to be huge >> huge in my world today is chip and joanna gaines are launching their new tv channel with discovery is there anything kind of new media to say about this or is
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this just a bet that these two, their brand, can help discovery stand out in this ever-crowded universe >> it's a little of both you are a big fan of them. discovery is betting they'll rebrand one of their existing channels and bring their star power. their new network is going to launch in 2020 also an app. if you subscribe to cable tv you'll get this custom app with a full library of all their shows they've ever done. easy to search and browse. they'll launch a subscription service. we don't know anything about it. and we don't know how much it's going to cost. >> a crowded field they have to stay relevant the show hasn't been on hgtv for a while now. that show is great julia, thanks. julia boorstin don't miss "squawk box" tomorrow joe kernen has an interview with mike pence right here on cnbc. check, please. after this 238
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check please a lot of people tuning in to watch the bank ceos on capitol hill and apparently one of those tuned in was the former ceo of goldman sachs lloyd blankfein who tweeted this i really miss my old job, remembering fondly those days he was in the hot seat. >> goldman shares up 1%. i wanted to mention watch "jeopardy" tonight last night a professional sports gambler won $110,000 on the show more than that even breaking the
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single day record. i happened to catch him the night before last when he had like $40,000 going into final jeopardy it's really fun to watch >> i will. we'll watch "jeopardy. i'll play long >> "closing bell" starts right now. it's the final hour of trade. bank ceos getting grilled on capitol hill we'll look at whether the focus on the banks could negatively impact the stocks. steve mnuchin breaking news on cnbc this afternoon about the china trade deal we have all of those details and lyft shares getting crushed again today as details about uber's ipo emerge. if the t "the closing bell" begins right now. >> that, of course, was morgan brennan. i'm brian sullivan welcom

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