Transcripts For CNBC Squawk On The Street 20240622

Twitter. Shares down 11 premarket after showing the worst growth rate ever. I spoke the outgoing Procter Gamble ceo yesterday. That coming up. Some disappointing guidance but first up twitter taking a hit despite beating expectations revenue up 61 in the user growth quarter. Interim ceo dorsey last night expressing his dissatisfaction during the Conference Call. Instant time lines and logged out experiences have not yet had meaningful impact on growing our participation. This is unacceptable and were not happy about it. We need to do three things. One, we need to ensure a more disciplined execution. Two, we need to simplify our service to deliver twitters value faster and three, we need to better communicate our value. Stock closed at 5 . Ended up down 11 after hours. The quote of the day, we do not expect to see sustained meaningful growth until we reach the mass market and we expect it to take a period of time. Thats what i spoke to the cfo about before we came on. And i put that to him. I said what do you mean reach mass market. You have. Everybody in the world knows you but they dont want to use you, and he said yes, everyone has heard of it and only certain people know how to use it. Again, they go over how difficult it is to use and how unsatisfying it is for people other than for a very few people and i said anthony, give me a reason to tell people to buy the stock now and he said if they take a longterm view you might buy stock but nothing in the immediate horizon, meaning in the next quarter or two. Youll people read jim cramer on twitter, itll be taking over. You dont take over a company with no growth. People want growth. They want growth at even an unreasonable price in the market. It was a discouraging Conference Call. It was not like baidu which was like listen we dont care. They actually care. The periscope was a bad idea because the body language was like were two and 14. Were going to make the playoffs but itll be a long time. I said listen guys i mean smile, do something, your body language is terrible. He said it was a demonstration of the product. I said there is an element of theater involved here and this was a a show that flapopped and got a bad revenue. To be fair they just dont have any growth in the chart in Monthly Average users which is important. Theres also this ratio of daily users to monthly users down. That ratio comes in 8 . I mean the issue of growth is one thing. The issue of existing users suddenly not checking in is Something Else entirely. Whats clear is in the next two quarters youll have growth down. Its down. Its not flat. Its down. In user base. Yeah. Thats what it sounds like. David, im going to tell you something. Its going to make your ego feel really big. A lot of this Conference Call was about you. That was the sub text. It was about you and your interview with mountain man dorsey. That was dorsey and costelow saying were here and we love each other. Your interview made them look like idiots. They repudiated everything they said to you. Were going well were doing poorly. They looked at the tape of you in your interview and said we must say everything the opposite. So they went from thinking all right. We love it to being all right, that didnt go over. We hate us. This was an existential crisis quarter on periscope where you saw people literally implode before your eyes. You think we did well . Well, let me tell you how we really did. You think were good . You know what . We dont deserve to be owned by you and we spent 700 million on talent walking out the door. We spent money on cap ex. What do you think if youre owning our stock, idiot . Thats a good way to drive an investment base away. I wanted to say at the end, im sorry that i own the stock. I didnt mean anything by it. I didnt mean to hurt people. Its a shame if i was a big institution and i ran pension money, i would say i apologize that i bought the stock. Are we now in a chapter where activists come in and demand massive buybacks . They cant do that. The activists are the people on twitter who say ive got 100 shares and im going to let them have it. The activists go after companies that are doing incredibly well where theres not that much downside. And i think what happens is they know theyre backed down by the fundamentals. This is an operational story. Not an allocation story. Dont get into my space. You dont get activists looking into that space. You got it . I got it. Are you implying they will go the way of they may activists. They may welcome guys with new ideas. They need to hold a user convention of the heavy users and say what do you guys need. Ive known them for a long time. I like noto. Anthony knows that. He helped bring the street. Com public. Im not making an analogy of the street. Com but i think they have an existential crisis that plays out in front of your eyes and that makes it difficult to own the stock and this is like my kingdom it is a shakespeare tragedy and when you did your quarter, that interview, this was like hey, guys this comedy all is well that ends badly. They conflated the two. It was a discouraging Conference Call. Very discouraging. Yeah. Well talk about it all morning long. Futures on the raise today as stocks look to build on the rally. On tuesday the fed is set to wrap up the policy meeting. Investors looking for clues of a timetable for Interest Rate hikes. In china ending a threeday losing streak. Youve said i guess were going to live with this like a lowgrade fever for a while. Yeah. They like to close the, china wants it to be higher. The communist party is in charge of this party right now. Theyre the only natural buyer. I was thinking if they could close it down higher maybe the commentary but the fed has to wait. They gave you a pass on greece. Do they look through the Chinese Market know that its headed down and then say we cannot tighting because we see china rolling over . I dont think they have that. By the way, my sources in china, they see the death cross coming. They are playing the part. The Chinese Government comes in where you want to come in to make the chart more positive. They are playing the chart as if theyre mothers day traders, the Chinese Government. This is not going to end well period. Of course not, but youre hoping that yellen says that. It goes back to where it started. To extent they dont succeed in stabilizing the market, that is what i mean. They manufacture things. And i think theres another economy away from the stock market. And, remember individuals are allowed to have five accounts. The numbers down dramatically last night. The government is trying to rebuild people who lost a lot of people. Make aircraft carriers. But making that leap from a loss of market cap for a domestic market and the losses suffered by that population to the fact that the chinese economy is going to slow marketedly as a result is a big leap and not one that you can make. The nasdaq went from 1,000 to 5,000 down to 1,000 but it was 9 11 that hurt the implieconomy. I think thats a similar situation. If youre looking for the chinese rollover to tell yellen what to do she may not buy into that. We still dont really know there may be ownership and things of that nature that could be transmitted over here. We dont know. But if it continues to decline, it was up yesterday. Every company i deal with says that there is no decline since the stock market went down except for the Largest Oil Company in the world which said theres a dramatic decline, and i trust the people from germany who sell cars and the car sales are bad, and i think you can say it may be the only things they stop buying is cars. I dont believe that. Thats a big thing to stop buying given its the Worlds Largest market. Is it . Car sales are hurt much more by this decline than they were by the nasdaqs decline. Car sales are meaningful. That is the marginal Growth Market in this world so its not a bullish sign. The Chinese Government is playing the chart, but theyre trying to keep the chart its bad, and i think they probably like it theyre saying the how can we head off the death cross and just make it so the mac d crosses over badly and the 50 doesnt do the 200 day. They like the overboard nature. They have skilled technicians. They chart and theyre all saying wow, our chart is bad. How do we impact the chart and they cant. I mean the chart is like they would love to come in and move the chart up so its a reverse head and shoulders pattern. Procter gamble, good interview, but they dont have the ability to reverse the pattern. Speaking about Procter Gamble and shampoo. They have chosen their future leader. David tailer is going to take over. Laughly will continue on as the executive chairman of the chairman. Last night i spoke with the current ceo. I asked if we should expect to see more divestitures under the new leadership. Is that transformation which has included as many as 93 brands and a lot of the revenue that goes with it is that transformation completed . In capitalism the transformation is never done but as john muller and i have said several times, this is 95 to 100 done for the foreseeable future. As you pointed out, we have moved to a company of ten focussed core businesses. These are businesses that we understand. These are businesses where i think in seven out of ten cases we are currently the worldwide leader with a lot of up side so we have a much simpler, such easier to operate, such more strategic business going forward. Of course you can see some of the brands right there. There are still Companies Reporting earnings on thursday tomorrow. And it will be interesting to listen to the call. In reading the transcript from the april call theres a number of analysts who say its not enough. Why dont you go for the big split, and i asked mr. Lafly about that and he didnt really engage on that question simply coming waceing back to saying they are where he feels they need to be. They have deals that have substantially lower the revenues as well as getting rid of many brands and employee rolls coming down to levels they havent seen perhaps since the early 1990s. Certainly a more focussed company. But then there are others who say they dont have their mojo. Getting organic Revenue Growth above 2 is still going to be quite a haul for mr. Taylor when he takes over. Polman at unilever they are up, they are kicking their butt. When youre Procter Gamble you wake up and say were getting our butts kicked by unilever. They have not reversed that. Polman has mojo. He stole their mojo. When when he come back this morning, well get a lot more on todays earnings. Also nick bilton author of the book hatching twitter, well get his thoughts on twitters call last night. And were a here at td ameritrade, they work hard. Wow, that was random. Random . No its all about understanding patterns like the mail guy at 3 12 every day or jerry, getting dumped every third tuesday. This happens every third tuesday. We have Pattern Recognition Technology on any chart, plus over 300 customizable studies to help you anticipate potential price movement. Theres no way to predict that. For all the confidence you need. Td ameritrade. You got this. Ive got two reasons to take care of my heart. Thats why i take meta. Meta is clinically proven to help lower cholesterol. Try meta today. And for a tasty heart healthy snack, try a meta health bar. Twitter is not the only social media firm having a rough morning. Yelp tumbling 0. 02 a share. Current quarter guidance below consensus. The chairman stepping down. They stopped providing maus. Six downgrades today. Almost all of them from a buy e live lent. Its a good letting. This was a terrible Conference Call about a terrible quarter about a company that i think is in a lot of trouble. Could you think of a worse day to say you want to spend more time with a firm . There was no Line International is particularly bad. It seems like this thing doesnt work overseas. Its almost like they have to do a total reset and say, okay we have to charge much less for ads, clean up the site and make it so when you look at it they tell you whoever pays the most is at the top. Google has e vis rated these guys. I think they would admit that offline things are quite bad. The only direct ads working. This was supposed to be the yellow pages for everything. Yelp has been outdone by so many different companies. This was a very discouraging call carl and i was, when i was on and i sensed a feeling of rez ignition that were just we dont have it. Sounds like another Conference Call i can think of. Some of these, baidu, twitter, yelp yelp. Theres a major reset going on. Yelp is no longer an Exciting Company to people to buyers to acquirers, to theyre just it doesnt seem to help. Theres no return on investment that is available for a lot of the people who advertise. They claim, the churn, i didnt like. They like the churn. To use an analogy from another ere era, you need to find some lipstick to put on this pig. And, of course there was a runup in the shares in the spring on stories that they were potentially for sale. Nobody is talking about that anymore. All these, dorsey can say jim, youre reading it wrong, its terrific, and others can say its a great quarter. The stocks are not lying. The stocks are telling the truth. Well get cramers mad dash and count down to the opening bell. We have to get to gilead and General Dynamics and buffalo wild and a lot more. Were back in a minute. Being a keen observer of the world has gotten you far but what if you could see more of what you wanted to know . With fidelitys new active trader pro investing platform, the information thats important to you is all in one place, so finding more insight is easier. Its your idea powered by active trader pro. Another way fidelity gives you a more powerful investing experience. Call our specialists today to get up and running. So youre a Small Business expert from at t . Yeah, give me a problem and ive got the solution. Well, we have 30 years of customer records. Our cloud can keep them safe and accessible anywhere. My drivers dont have time to fill out forms. Tablets. Keep them all digital. Were looking to double our deliveries. Our fleet apps will find the fastest route. Oh, and your boysenberyy apple scones smell about done. Ahh, youre good. I like to bake. With at t get up to 400 dollars in total savings on tools to manage your business. Time for a mad dash on this wednesday. Were going to focus on gilead of the 166 billion market cap that was recently 173 billion. One of the Biggest Companies out there, period is gilead. Right now its disguised. Its cosmic. All right. Now, look if earnings matter and earnings surprises matter and it was up even more. It was up six points most the night. This one would be it. This is the anecdote just like its the anecdote the hep c. This is life about membershiponey. This is the anecdote to yelp and twitter. This was a fine fabulous quarter where theres an unmet need that the payers are going to have to pay because it is such a superior drug to e rat eradicate hep c. If you get it earlier, it costs less. The va had a problem. Every single the lead story should have been how does the va not have enough money to pay for hep c. The elephant in the room is what are you going to buy. They have a lot of opportunities. There are a lot of biotechs. We dont think biotechs are necessarily overvalued. They have a ton of cash. The world is their oyster. This drug is a cure and its a remarkable cure and hats off to gilead for curing a disease. Without a doubt, and i made the point last week and given your comments and theirs about acquisitions they have more debt capacity. They can add more debt than any other company in pharma deal so they can do a big deal if they want to. More than Brent Saunders now that hes debt free. That was before the allergan deal. Very interesting products in biotechs that they dont think are overalled. When you cure a disease, i remember when i was growing up and they cured polio, and you thought wow, thats curing a disease. Its worth paying. The opening bell is coming up. A lot of companies and earnings to watch. Stay with us on skoik. Squawk on the street. More and more, data is visual. In fact, the number of mris has increased by ten percent a year. And a radiologist might view a thousand images to find one tiny abnormality in shape, contrast or movement. Because its so challenging a Research Project is teaching ibm watson to see. In the future, it could help clinicians spot key patterns quickly and precisely. Ibm watson is working to make healthcare smarter every day. Youre watching squawk on the street live from the Financial Capital of the world. The opening bell in less than 60 seconds as were trying to keep up with the earnings and awaiting the fed Statement Today at 2 p. M. Eastern time. Elsewhere around the world, brazil getting warned by s p. Weve been talking about brazil for days. How can that leadership stay in power . I dont know. They just got reelected. I think that that brazil is when you listen to the Conference Calls, brazil is always the worst thing. Atco saying brazil is bad. Brazil is worse than china. It is worse than china. Much worse. Yeah. With the olympics a year from now. Theres the opening bell. And the s p at the bottom of your screen. At the big board today it is brown and brown. An independent insurance intermediary over at the nasdaq bravos Million Dollar listing. San francisco airing wednesday nights. Theres a symbol for brown and brown, its bro. As in you mad, bro . Thats right. Weve been seeing that all over the Exchange Floor today. Gilead is the winner. Up almost 5 . Raising their full year. Hep c, Dow Jones Today says two of their drugs are the most successful drug launches ever. There are many people whose lives are going to be changed dramatically. This is not a fanciful pricing and i think theyre at the beginning of the ramp and then theyre going to buy like when celgene bought receptos. Even though they were paying a hefty price, it went up. These guy who is run gilead are really very good at their job. Great cfo too. Gilead is incredible. Coming as it has seemingly out of nowhere. Obviously its been around for a while but its incredible. As i pointed out last night, passed merck in market cap. Hiv, they started the call talking about hepatitis c. They talked about some new, all new work theyve done on hiv. A lot like some Pharma Companies that seem more focussed on tax rates, these guys seem focussed on science. Theyre not trying to figure out how to be located. Theyre just trying to figure out how to reach the people whose lives are changed by getting their drug. Its not a me too drug either. We have a lot of food news. Dine equity. Comps at i hop up 6. 2. A tenyear high for the third consecutive month. Din has been under pressure. It shouldnt have been. The ceo started bussing tables at i happen has put together a remarkable team. That is as inexpensive as jack in the box when it comes to restaurants. Congratulations to julia. Shes a candidate for an activist. Shes doing a fantastic job. She has the stock doing well. The business is graelt. Thats where you get an activist. A record high on panera even though they missed by 0. 02. It was the last point in the release where someone says listen panera 2. 0 is working. That was it. Everything else was bad. And then you have buffalo wild. What was it up 9 premarket . I didnt even like the call. They cut their guidance. Chicken costs are difficult. Right, but they are talking on the Buffalo Wild Wings about how the last couple weeks were good. A little bit of acceleration in the comp store numbers. Theyre buying back some franchises. When they run a company they do better. It is amazing, it shows you how oversold the restaurants got. When she misses it still goes higher. And it was a miss. And its sad that wings cost too much. When i go, i get the ones that are like this. I like the big ones. Not the mini drumsticks. Do you like these more than the big ones . No. I want you to mull that over. Its really messy. The whole thing is just messy. You either like the big ones or not. Why did you have to waffle on this one. You either like this one or this one. I think i like the big ones. Okay. Thank you. Mastercard has come in below the 50. We had to sell that for action visa did better. Gross dollar volume up. Charlie scharf won. Nowhere near visa. Mastercard has been a good stock but Charlie Scharf at visa won this round. And scharf is an investor in the stripe that i mentioned yesterday. He hasnt come on tv. Doesnt seem to be hurting him. Hes the quiet man. Really nice gains. Im going to get killed. John wayne theyll kill me on twitter. What do you need . The star of quiet man. I want to be sure. Its going to blow up. Theyre going to take all the heat out on me because i may have remembered the wrong quiet man star. There it is. Youre the reason the stock is down. You cant even remember the stars. Twitter, down 10 . Im looking at a new note at rbc titled twitter has hit a wall. Twitter has hit a wall. The brick wall. The brick wall is the indy 500. It is possible though that they figure something out. That they have a breakthrough that eliminates the socalled, and this is the worst costolo used getting around the service. You try to make it like time magazine. I want sports. I want draft youre bringing that up as a Growth Opportunity . Im saying it was ordered. You could turn to whatever unned to and say, okay this is what i want. You say thats coming. That will come. We are going to allow you to cure rate. You will have the story. And thats what i want. And i want to make it so i dont have to i dont know. Its like i want to follow it. Im following jeremy maclin. I would like to have a feed of everybody from the eagles. He was an. You could do it but you have to cue rate it. Youll have to hire humans. And you know what you do when you get stock and work at twitter. Sell it. Bingo. Thats why you won jeopardy. Shares of mylan down. Keep an eye on that one. It is an ongoing saga. The huge deal that was done on monday between allergan and teva nature they. They have to get stock prices up. I got push back saying give us a chance here to get the sellers out of this stock as we move ahead toward our shareholder vote. Some people think theyre not going to get that vote of their own shareholders. I think thats crazy. They will most likely and then well see perrigo shareholders like the deal. If 87 of them like the deal, thats an important threshold. That is so complicated, that situation. Perrigo is an Israeli Company thats based in ireland. The Manufacturing Products are in michigan but its really from philadelphia. And mylan is a Pennsylvania Company but actually dutch, although for tax purposes its a uk jurisdiction. Uk taxes. Corporate but who can understand this stuff . Incorporate ratedd in the netherlands. Let me hash tag head explosion of pfizer ceo. It is not a level playing field. It is not. With the taxes and everything else, it is not. What has happened with the inversion change done by treasury, theyve cut it. Now it makes it difficult but our companies are disadvantaged versus companies that do business here. Its not quite right. Thats why if allergan takes power and buys am jen, it can make it to am jen and make it so they pay fewer taxes. Tablo is out. This was the first time they were below 70. They hit 65. Theyve had this great so to speak. And the revenue has had growth. They have high expectations. The highest expectations of anyone in the work now that sales force jammed. You have to be careful with that one. That has more fall only because this is the first time that they did not do the super beat the 65 was still better than what some people were expected. And there was a Conference Call where people were saying is it price competition in they try to say its not price competition. I think it was. This is for a content delivery system. Akami did not move the security business as much as i thought. They didnt have any big games to be down loaded or big movies. I would not bet against akamai but a discouraging Conference Call. I was telling the wife last night, i was i said i have to set the 11 30 and wake up at 2 30 to see how the chinese comps are doing in the market. She said what are you doing . I said if i had one Conference Call that made me feel good i wouldnt have to be in this situation. I was jugging peptobismol at 3 30. Dont take it to personally. Whats on tap tonight . Even bigger tonight than last night. Maybe one of them will be up. I have facebook tonight. Thats perfect. That always makes you happy. Im going a facebook Conference Call nothing makes you happier. Last quarter they got killed. But you liked the Conference Call. It was well done. I like the drama. West side story. It was the only movie. That was a play. It was morphed to a movie. That was the most tweeted thing we got. Theres another thing. Noto, i want a column for people who watched Marlin Brando movies. Is that what they say, we could have been something, could have been something instead of a bum. In the book terri malloi dies. We do have the dow up 40. Thanks in part to visa. Bob is on the floor this morning. Reporter in mastercard reported as well. A mixed open. Im a little disappointed because were not getting the follow up in the sectors here. Energies and materials, once day bounce back yesterday after days of being on the downside. Materials just went positive a moment ago. But tech and financials and health care holding up and thats what people care about. Financials and health care. As long as theyre doing well, the market is holding up. Were a little better. Put up the shenzhen its still a pretty wild ride. Almost a 7 move from the bottom to the top. It ended positive but pretty wild intraday swing still. We also had a good day because europe is having a good day and earnings are out in europe as well. Bayer did well. Barclays is at a 50week high. Peugeot had a good year. The french car is up a lot. Its not a high price stock but up a lot this year. Good news in europe. Here in the u. S. The big multinationals are reporting and its the same problems day after day. Problems with weaker sales and currency. Sales were eaton big multinational company, Industrial Supply parts. 6 of the 7 decline was currency. 1 was due to organic sales and the Revenue Growth is not great. They lowered their earnings guidance. This is the simple problem. No organic growth and getting hit by the dollar. And praxair, almost all that due to currency. No no organic growth. Brazil sited again for weakness in china. These stocks are up and down and theyve had a terrible year. All these Big Industrial names have had a terrible year. On a positive note mastercard talked about revenue of Foreign Exchange hurting their revenues but other metrics were strong. Their earnings per share growth 15 if you take out Foreign Exchange. Thats a good number for them. Volume growth was good, up 7 in the u. S. Europe was up 15 . Not a bad number. Thats a pretty good year. You mentioned brazil. I want to note here brazil getting warned by the s p. Thats a problem all throughout the year. There you see the big etf for brazil. Finally, its the fed day and this gets passed around every day. Very famous 2011 statement by the fed, the new york fed that on days when the fed announcement happens, markets move up. In fact, more than 80 of equity premium on the u. S. Stocks was earned in the 24 hours before the fomc announcements. This is always passed around every time it happens. Thats a 2011 fed survey study that was done. Right now dow is up 33 points. Thanks so much bob. Lets check in with Rick Santelli in chicago on this fed day. Reporter hi, carl. Ill pick up what you just eluded to. That is the second day of the twoday fed meeting and there is a drift, just a drift, of rates to the up side. Look at a twoday chart. I like twoday charts. We are trading a bit and have traded a bit higher than yesterdays yield or at lower price. Thats something to Pay Attention to. If you look at the chart from may first, it tells you how much what we call wood under the market. Thats technical support. The more time you spend at a price, the more technically significant it becomes and when you move away from the areas you gain momentum. Look at a twoday chart of the bunds. A much different chart. Not building the same type of momentum but hovering above a significant level of yield resistant. Around threequarters of 1 . 75 basis points. Lets look at whats going on in front of a fed meeting. Lets start this chart on january 30th of this year. You can see were not doing much but we are consolidating at a flatter curve than we have experienced on the dynamic coming up earlier in the year. A year today, dollar index is interesting. One of the biggest issues regarding normalization is the strong dollar. Granted, we closed a little over 90. The dollar is up but in march where we traded 100, the last chart is the euro versus the pound. The uk economy isnt doing bad nature they may be the other developed economy thats going to snug up rates. The euro is not having a fun party against the pound. Reviews of windows 10 pretty good this morning. In the meantime holding onto some slim gains on the dow. Up 28 points. More squawk on the street coming up in just a moment. No students ever been the king of the campus on day one. But youre armed with a roomy new jansport backpack, a powerful new dell 2in1 laptop and durable new stellar notebooks, so youre walking the halls with varsity level swagger. Thats what we call that new gear feeling. You left this on the bus. Get it at the place with the experts to get you the right gear. Office depot officemax. Gear up for school. Gear up for great. [ piercing sound ] daddy lets play sorry kids. Feeling dead on your feet . Ive been on my feet all day. Dr. Scholls massaging gel insoles have a unique gel wave design for outrageous comfort that helps you feel more energized. Dr. Scholls. Feel the energy want bladder leak underwear that moves like you do . Try always discreet underwear and wiggle, giggle swerve and curve. With soft dual leak guard barriers and a discreet fit that hugs your curves. So bladder leaks can feel like no big deal. Get your free pair and valuable coupons at always discreet. Com can a business have a mind . A subconscious. A knack for predicting the future. Reflexes faster than the speed of thought. Can a business have a spirit . Can a business have a soul . Can a business be. Alive . Can it make a dentist appointment when my teeth are ready . Can it tell the doctor how long you have to wear this thing . Can it tell the Flight Attendant to please not wake me this time . The answer is yes, it can. So, the question your customers are really asking is can your business deliver . Microsoft windows 10 is out and the reviews are rolling in. The long awaited launch getting mostly positive feedback with major complaints mixed in. One says im buying in though i could do without Something Else familiar with windows past. One says a welcome upgrate to late. Walt mossberg says its a solid operating system for people bho like windows but dont upgrade until more bugs have been fixed. Theyre calling it the last launch of this scale from microsoft. Theyre going to go into more of an apple mode of evolutionary upgrades more often. I think mossberg is what my tech guys are saying. Nothing exciting. This is its microsoft. Nadella, i think hes trying to get away there will be no windows 12. This is it. This is what you get, and we know from apples quarter that people want apple. Now its small versus the billions. Its like mcdonalds, billions and billions sold but you never hear people get together at College Campuses and say windows 10 is killing it. You have to get windows 10. It does not happen on any campus in america. Not in this country. Not a lot of passion around the product. Not a lot of passion, yes. Passionless. Its like can you believe how Good American electric put on the power today. Did you see how the lights went on immediately . Lets hope that holds up in the this heat wave today. When we come back, Bill Belichick is set to hold a News Conference this morning. Theres a shot. Well take you there live and see if he fields any questions regarding tom brady and the nfl decision yesterday. Well get to stop trading with jim in just a moment too. Dow is down 17. Dont go away. Trading. When this year is over this quarter the companies that will have have been the best is the defense stocks. A lot of it is because of iran and General Dynamics were amazing. An additional short squeeze in General Dynamics. Gold stream backlog is fabulous. These are amazing companies. This is the area to be in because we are not going to defend what used to be our allies. Its all pretty clear. Were pulling back everywhere. Japan, nato pulling back. Middle east pulling back. These countries have no choice but to write giant checks to General Dynamics and thats why those stocks are up and it has to do with geo politics. Backlog up. Er a. Then from north rop, these guys are buying back stock, taking money in. A lot of big short base in it. Its the world spending on defense and these guys are the arms doolealers to the world. Whats on mad tonight . We have Waste Management which i think has been a solid company. People did not like the last quarter. And sandy cutler on etn which people have liked the last few quarters. Browneyed girl playing a new game. Playing a new game. No more mr. Nice guy. That nice guy stuff, im leaving it at home. Well see you tonight. Mad money, and a lot more on twitter, trying to defend 32. Back in just a moment. [ male announcer ] some come here to build something smarter. Some come here to build something stronger. Others come to build something faster. Something safer. Something greener. Something the whole world can share. Grumman. The so youre a Small Business expert from at t . Yeah, give me a problem and ive got the solution. Well, we have 30 years of customer records. Our cloud can keep them safe and accessible anywhere. My drivers dont have time to fill out forms. Tablets. Keep them all digital. Were looking to double our deliveries. Our fleet apps will find the fastest route. Oh, and your boysenberyy apple scones smell about done. Ahh, youre good. I like to bake. With at t get up to 400 dollars in total savings on tools to manage your business. Welcome back to squawk on the street. Im quintanilla with sara eisen j simon hobbs, david faber with the a new york stock exchange. Hanging onto a thin gain. Earnings continue to be the story whether its northrop or twitter or yelp. Dow is up 29 points and the nasdaq is slightly in the red. Breaking Economic Data at this hour. Lets go get breaking news on pending home sales. Reporter pending home sales down 1. 8 in june from may. Thats a miss. The street was looking for up 1 . Down 1. 8 . Thats also a turn after five straight months of gains on this pending home sales index which remits signed contracts not closing. This is an indicator of july and august closings. The markets warned of weakness. Were still up on the pending home sales index 8. 2 year over year. We saw inventories, supplies of homes for sale down in june and the immediatemedian home sale price down. Pendingsome sales in the northeast barely up. Down 3 in the midwest and the south all month to month and in the west barely up 0. 5 . We also might add that Mortgage Applications have been stuck in the mud for the past two weeks and barely moved over the past four weeks. Youre starting to see higher home prices cut into sales. Thank you very much. We want to show you a live shot at the stadium in massachusetts where the patriots coach is set to hold a News Conference. It comes a day after the nfl upheld tom bradys suspension. Its also the say the veterans report for Training Camp. Well bring it to you live as soon as the News Conference begins. A rough open for twitter, currently down 14 . Steadily slowing user growth. Interim ceo still, dorsey did highlight a bright spot for the company on periscope last night, namely periscope. I agree that periscope is the next thing thing but we have no plans to share around monetizing it just yet. One of the Amazing Things about what weve done with twitter and with the team has really pushed is the monotheization fits perfectly within the service and makes the service better. Were looking for opportunities to do more of that and we would hold the same high bar to what we do with periscope and with related Properties Like vine. Okay. Lets bring in the senior internet analyst with city mart. I guess the bulk of the call last night is this brutal assessment of what twitter needsed to from dorsey. Everybody seems to be clear where the business now stands. I think no theres nowhere to hide anymore. Users have been essentially flat in the u. S. For about four quarters now. And theres obviously a ceo search ongoing. Try to bring someone in that can help turn the product around and hopefully that results in improved financial results. As they admitted last night on the call this is going to take a while. Let me play from that call the comments of the cfo, noto the exof goldman sachs. In his prepared remarks he said this about average monthly users. Growth and maus until we start to reach the mass narcotic. We expect that market. We expect that will take a considerable amount of time. For a considerable period of time, youre not going to see growth what do you think about that . They have monetized the existing user base at a pretty considerable level. We think in the u. S. The ad load and monetization is approaching of that facebook. Its a more mature level from a advertising standpoint. They need to start growing not only the users but improving the engagement of the users they do have. Thats key to them hitting revenue forecasts for next year and for the stock working. Its key to the whole story. Jack dorsey not only clearly described how he thought the business needed to change with a threepoint plan. There was a lot of comment about that. Perhaps he would like to remain as twitters permanent ceo and some would suggest possibly leave squoirare even before the ipo. Do you see that happening . I think its hard to call right now. We saw even prior to last night, a lot of support internally and externally at twitter for adam bane, the head of revenue at twitter, and obviously jack dorsey is also a front runner. Its really hard to tell right now. I think either would be good candidates but have a tough road ahead. Which do you think would be better for investors . Well adam bain has been performing at the company. Its wellliked. He has a Great Network both externally with advertisers as well as well liked by employees inside the company. So we think adam bain is probably the best choice here for twitter, but either one is going to have a really tough challenge ahead of them. Mark you always hear the comparison when it comes to twitter to facebook. Do you think that is a fair comp and if so then where does that put you on twitter and on facebook ahead of earnings this morning . Well i think one of the misconceptions is that twitter and facebook are pretty similar businesses. And theyre really not. Twitter is a News Consumption platform where facebook is really around social networking. Youre looking, youre reading and catching up with friends and family. And because of that the engagement is very very different. You have four to five times the engagement levels by the users with at facebook than twitter, and you have the viral feeling. If your friends or family are on facebook you want to be there too. You dont have that with twitter which is a News Consumption platform. Theyre very different businesses. Thank you for your analysis mark. Lets take you to the stadium where bob kraft has just taken the stadium. After this i will not be talking about this matter until after the Legal Process plays itself out. And i would advise everyone in the organization to do the same and just concentrate on preparation for the 2015 season. The decision handed down by the league yesterday is unfathomable to me. It is routine for discipline in the nfl to be reduced upon appeal. In the vast majority of these cases, theres tangible and hard evidence of the infraction for which the discipline is being imposed. And still the initial penalty gets reduced. Six months removed from the afc championship game the league still has no hard evidence of anybody doing anything to tamper with the psi levels of footballs. I continue to believe and unequivocally support tom brady. I, first and foremost need to apologize to our fans. Because i truly believe what i did in may given the actual evidence of the situation and the leagues history on discipline matters would make it much easier for the league to exonerate tom brady. Unfortunately, i was wrong. The leagues handling of this entire process has been extremely frustrating and disconcerting. I will never understand why an initial erroneous report regarding the psi level of footballs was leaked by a source from the nfl a few days after the afc championship game was never corrected by those who had the correct information. For four months, that report cast aspersions and shaped public opinion. Yesterdays announcement by commissioner goodell was released in the same matter in a headline that read tom brady destroyed his cell phone. This was designed to capture headlines across the country an obscure evidence regarding air pressure in footballs. It intentionally implied nefarious behavior and minimized the fact that he showed the history of every number he texted during that time frame and we had already provided the league with every cell phone of every nfl nonnfl pa employee that they requested, including the head coach, Bill Belichick. Tom brady is a person of great integrity and is a great ambassador of the game on and off the field. Yet, for reasons that i cannot comprehend, there are those in the League Office who are more determined to prove that they were right rather than admit any culpability of their own or take any responsibility for the initiation of a process and ensuing investigation that was flawed. I have come to the conclusion that this was never about doing what was fair and just. Back in may, i had to make a difficult decision that i now regret. I tried to do what i thought was right. I chose not to take legal action. I wanted to return the focus to football. I have been negotiating agreements on a global basis my entire life. I know there are times when you have to give up important points of principle to achieve a greater good. I acted in good faith and was optimistic that by taking the actions i took the legal would have what they wanted. I was willing to accept the harshest penalty in the history of the nfl for an alleged ball violation because i believed it would help exonerate tom. I have often said if you want to get a deal done sometimes you have to get the lawyers out of the room. I had hopes that tom bradys appeal to the league would provide Roger Goodell the necessary explanation to overturn his suspension. Now the league has taken the matter to court. Its a tactic that only a lawyer would recommend. Once again, i want to apologize to the fans of the new England Patriots and tom brady. I was wrong to put my faith in the league. Given the facts, evidence, and laws of science that underscore this entire situation, it is completely incomprehensible to me that the league continues to take steps to disparage one of its all time great players and a man for whom i have the upmost respect. Personally this is very sad and disappointing to me. Now, i know the real reason you came here was to hear coach belichick, so ill turn the podium over to him. Can you do anything different . Can you change anything . Well its good to see everyone back here. Got all the players back today for the start of Training Camp and right now were in a long step by step process as we head into the beginning of the 2015 season, so were just going to take it one day at a time. We have some preparation work to do in terms of conditioning and going through some policies and things like that trying to get everybody on the same page like we normally do and well try to have a good day today, and then try to have another one tomorrow and just string them along day by day. Thats really where were at. I think robert took care of the other situation. Toms had his statement. So theres nothing really to talk about there. Wont be dealing with that at all. Well just try to get the team ready, and prepare for the regular season as we always do and as we did all spring. So theres really no change for us on the football team. Is there more ability to understand this how do you think Something Like this will impact your corporation . Were going to take it day today just like we always do. Do you believe as tom brady says that he believes neither he for anyone in the Patriots Organization did anything wrong . We start Training Camp today. Well get ready for the 2015 season starting today. Coach, is there something flawed about the system in the organization that you keep ending up in these cheating controversies . Can you explain why . Its already been dressaddressed. Can you elaborate . No. Why not . Because its already been addressed. People have a lot of questions. You know a lot of fans. You heard what robert just said. Its been addressed. Maybe you ought to go back and look at your notes. Its been addressed. Were you personally surprised yesterday by goodells decision . Were going to continue to get the team ready for the 2015 season. Thats what were going to do. How difficult is getting ready when you may not have your quarterback. That is the head coach of the new England Patriots. Witnessing a big falling out between the commissioner of the most powerful Sports League and arguably the most powerful owner in bob kraft saying he does not essentially trust the league. Follows tom bradys Facebook Page when he said i did nothing wrong. We contacted the phone company to see if there was any way we could retrieve any of the text messages. This is this is a bigtime drama going on in the league right now. Youre not going to hear anything from belichick but kraft, that was extraordinary. In the sense of probably the most powerful owner, certainly the most storied nfl franchise going after his onetime ally the commissioner at the nfl and the league itself. I was wrong to put my faith in the league. What do the other owners do . Do they side with him . Thats an interesting question. He basically said i should have taken legal action right away and i thought i could negotiate this the way ive done so many other things. This idea that penalties get reduced on appeal is interesting but the Player Association is expected to file an appeal. Itll take a long time. Theyre looking for a friendly state in minnesota or massachusetts but brady in his statement says he does not want this to become a precedent for future players who were involved in similar situations. What a shame he destroyed his cell phone. A broken samsung phone, as brady says. Thats not the front page of the daily news or the other newspapers. Which kraft said that implies something nefarious by them putting that headline out. Again going after the league. Tom brady is a person of great integrity, he says. He was defending his players and going after goodell. Interesting to see. Coming up next the count down is on. It is fed decision day. Now less than four hours away. Investors waiting for any kind of signal or clue or statement about the timing of a fed Interest Rate increase. What to expect this morning when squawk on the street comes back with the dow up about 47 points. My name is jamir dixon and im a locate and Mark Fieldman for pg e. Most people in the community recognize the blue trucks as pg e. My truck is something new. Its an 811 truck. When you call 811, i come out to your house and i mark out our gas lines and our electric lines to make sure that you dont hit them when youre digging. 811 is a free service. Im passionate about it because every time i go on the street i think about my own kids. Theyre the reason that i want to protect our community and our environment, and if me driving a that truck means that somebody gets to go home safer, then ill drive it every day of the week. Together, were building a better california. Were just a few hours today from todays big Federal Reserve decision. Investors hoping for a clue about when the Interest Rate increase will happen. Steve liesman is live in washington for the event. For more on what we can expect no News Conference today but a statement to parse. Look at it closely. Theres a general but not overwhelming expectation that this is the meeting before the meeting when the fed likes the rates. The consensus is that theres no explicit hipt. 52 saying july is the meeting before the rate hike meeting. 48 say its later. 82 say rate hike comes this year. 63 this year do not expect a hint in this Statement Today about a hike. How much does this matter about this month or december or next year. It depends on how shortterm your outlook really is. Heres the secret forecast we got last week. The recently released forecast it shows in general, rates are going to go higher at a gradual pace and even five years from now running above 3 . In the context of general agreement, agreement hike agreement, hiking in settlement or december doesnt make a difference if you have a longterm outlook. The fed says it has two tests for hiking rates but officials, they say theres three tests. Lets take a look at the tests. First, jobs. Are we there now . Yes, but i think theres still some slack given the current Unemployment Rate. Inflation, are we likely to get to 2 . The answer is unclear. You have Global Economic weakness coming through the system along with commodity price declines. It could put more downward pressure on inflation. The third one, but fed Officials Say it can the economy withstand further rate hikes. The idea is that its not just one hike but can it withstand the impact of multiple hikes. Yellen has sounded like a banker that wants to hike but shes also said shes data dependent. Its possible for the economic reports between now and september to justify a rate hike but, carl i think its going to be difficult. Steve a busy afternoon ahead. Look forward to seeing you later on. Steve liesman in washington. When we come back james lillie. The dow session up close to 54. Can a business have a mind . A subconscious. A knack for predicting the future. Reflexes faster than the speed of thought. Can a business have a spirit . Can a business have a soul . Can a business be. Alive . Every Auto Insurance policy has a number. But not every Insurance Company understands the life behind it. Those who have served our nation. Have earned the very best service in return. Usaa. We know what it means to serve. Get an Auto Insurance quote and see why 92 of our members plan to stay for life. Can it make a dentist appointment when my teeth are ready . Can it tell the doctor how long you have to wear this thing . Can it tell the Flight Attendant to please not wake me this time . The answer is yes, it can. So, the question your customers are really asking is can your business deliver . You focus on making great burgers, or building the best houses in town. Or becoming the next highlyunlikely dotcom superstar. And us, well be right there with you helping with the questions you need answered to get your brand new business started. Were legalzoom and weve already partnered with over a million new Business Owners to do just that. Check us out today to see how you can become one of them. Legalzoom. Legal help is here. Straight ahead on the program, former fed governor mark olson joins us to weigh in on todays fed decision. What is he expecting now until the end of the year. Find out after this break. No students ever done the full hand raise in ap calc. But your stellar notebook gives you the gumption to reach for the sky. Thats that new gear feeling. All hp ink buy one get one 50 off. Office depot officemax. Gear up for school. Gear up for great. Welcome back to squawk on the street. We are reporting on the floor of the nay max. Oil going into positive territory. Crude Oil Inventories down 4. 2 million barrels. We were looking for an inventory build so this is a bullish number. Traders told me to talk the gasoline numbers. Were looking for builds there. Confirmations that were seeing gluts in gasoline now that the peak of the driving season is over but we didnt get that. A build in distillates but not as much as expected. This is an interesting rate pushing prices over 48. 48. 18 is where were trading at this point. Well talk about the correlation to the stock market later today. Here is your news update at this hour. An Afghan Intelligence official saying they have come of the conclusion that a longtime leader has died. They believe me died two years ago and his death was kept secret to keep the taliban united. At a joint News Conference they said they hope a visit will prepare the ground for expansion of relations. New evacuation orders given in california after a wildfire broke through containment lines. It flaired up over night but Officials Say it is about 80 contained. And Angelina Jolie visiting myanmar. Shes meeting with the countrys president today. She says shes looking forward to learning about their hopes and their vision of the future of their country. Well keep you posted. Thats your news update this hour. Back to squawk on the street. It is fed day here. Lets go over to chicago with Rick Santelli for the santelli exchange. Reporter thanks, simon. Doesnt everybody out there love fed days . Havent missed being on the fed day since 1979. Id like to welcome mark olson. Thanks for taking the time. My pleasure. Always good to be here. Listen, i want to build a case and talk about the Federal Reserve. Maybe i have my own personal biases but my high both thinks is this. Zero is too low. A 2 to 2. 5 economy doesnt warrant zero Interest Rates. Is that something you can live with, mark . Absolutely. Theres no question. You do not want to have a zero Interest Rate environment. That just begs the opportunity to go negative into a deficit of an economy and you dont want that. You need to have inflation rates much higher than that and therefore, an Interest Rate, some premium above that point. Reporter . Yellen recently made the following statement. The Unemployment Rate may understate the lack of remaining slack in the market. Im sorry if this doesnt sound polite. We put all faith and credibility into the Unemployment Rate knowing full well percentage of the labor force thats working was going to make that number like measuring the pressure at the end of a hose that has a big leak where you connect it to the water. What do you think about her statement . I think you nailed the important point. Its the Participation Rate that is down. The Participation Rate is now Something Like 62. 8 meaning of the employable population, only 62. Something is looking for work. Thats lower than a year ago. Even though weve had added 2. 5 million jobs the Participation Rate is still low. Thats got to be enormously frustrating for the Decision Makers because they would like to see a bright green go sign and theyre not getting bright green yet. So its got to be theres got to be an element of frustration. I think thats what chairman yellen buzz talking about. Mark would you say that over the last six months to a year looking forward for the next six months to a year that the global economys glide path is a little higher about the same or a little lower. In my mind its a little higher, and thats only because we had a relatively weak first quarter. I think the Second Quarter numbers are going to come in a little more solid and theres going to be a gradual improvement in my judgment in the third and fourth quarters. Looking at all the three topics we covered, it sounds to me like that the fed has made its own water in its own Swimming Pool a little bit muddy. They probably need to raise rates. They hung their hat on a metric that didnt work out very well. And in the end, their timing was horrible. Finish up for the last minute trying to sint these for viewers what they may have to do over the next several meetings. Its clear. Theyve announced they are going to raise rates. Its a question of when, and the time willing never will perfect but we almost have a promise that its going to be yet this year. It likely will not be today. I would say theres a very good chance it will be september. If not, it will be december. My guess is september, and that so that promise will be fulfilled but they would like to have the information just be a little bit more firm. Now, we dont have a leak into the pool. We have some drainage from over sources polluting it. Thats part of the problem. We cant get that clear water environment to follow your metaphor. Reporter excellent. Mark, its always a pleasure to play pepper with some of the dynamics of the fed and the economy. Look forward to talking to you potentially for the next meetings. Sara eisen, back to you. Thank you very much. Twitter, one of the big movers of the day, tanking, down almost 13 . Posting the worst ever user growth. Julia joining us onset for a treat. She and jim cramer talked to anthony noto earlier this morning. Did he sound any better than he did on the call . He didnt. He sounded very serious and very negative. He really stressed to us that he doesnt want to sugar coat it. Twitter has had no organic growth and they realize they need an overhaul and a marketing campaign. He says people dont understand why its for people. Noto to be clear, we cannot expect to see sustained meaningful growth until we start to reach the mass market. We expect that will take a considerable period of time. I asked him what considerable period of time means. He says they really dont know but it should be a few quarters in terms of jack dorsey also going into details about twitters problems and how he wants to fix them. We havent done a great job at aligning the entire company around our total audience strategy. We are in the process of complimenting a stronger discipline of direct ownership and accountability that clearly serves a single strategy to expand our value of reach and they believe twitter is fixable. Noto telling us the company is focussed on three big project changes. Project lightning, instant time lines that would populate without you having to follow people and an easier way to use twitter without having to create an account or log in. But a lot of changes that need to happen before twitter management will be happy. I dont know. Analysts sort of seem encouraged that theyre recognizing the severity of the problems and they do face an existential crisis but for investors its another story. Its a transition point. Theyre waiting to announce a new ceo. Certainly a lot of things that we as consumers and also as investors are waiting on. People bring up why are they focussed on changing the product to katecater to people who decided they dont like it. The question is are you looking at a product thats only going to cater to 300 million people. 20 billion thats the value. And getting cheaper by the minute. Only one with a worse day is yelp. Up next the ceo of jarden which owns all kinds of brands. Theyll join us coming up next. Well get his read on the quarter. Squawk on the street will be right back. But youre armed with a roomy new jansport backpack, a powerful new dell 2in1 laptop and durable new stellar notebooks, so youre walking the halls with varsity level swagger. Thats what we call that new gear feeling. You left this on the bus. Get it at the place with the experts to get you the right gear. Office depot officemax. Gear up for school. Gear up for great. Is facebook heading to 100 a share . Well tell you why one person says facebook could surge after earnings. Catch our live version at the 2 00 eastern time of power lunch. More squawk on the street coming up next. [ male announcer ] some come here to build something smarter. Some come here to build something stronger. Others come to build something faster. Something safer. Something greener. Something the whole world can share. People come to boeing to do many different things. But its always about the very thing we do best. Shares of jarden gaining nearly 2 right now after reporting earnings and ref knewvenue in line with expectations this morning. Brands ranging from sun beam and outdoor gear. Joining us now exclusively to discuss an acquisition and the quarter is jimames lillie. Organic growth of 2 . Youre not seeing that kind of organic sales growth from other companies. P g would kill for half of that. Whats driving that for you . Its broad based. The appliance is growing 10 . Our sporting business is really a truly Global Business and they grew about 6 . Our branded consumable business which is primarily a domestic business like boik playing yards, candles, they have been our leader. Its grat fieifying to see everybody doing well. You made another billion dollar acquisition. Youre getting larger. 120 brands i think and counting and so many other companies, con gram zblsh conglomerates are getting small. How yoare you making the case that this is the right strategy. We have a good record of increasing revenue and margins by cross selling across our platform. We can help expand brands faster and less expensive than they can do on their own and our track record demonstrating our ability to do so. Jim, can you give us color on the nature of those negotiations when you have people agonizing over their products and you stand there as a buyer . Is there many of you in these discussions . Is it exactly the opposite . How does it typically stack up . The nice thing is we dont need to do deals to make our numbers. Were patient and were willing to hang by the hoop. We historically do not participate in auctions because things frothy. If you look at the Yankee Candle acquisition, it was p e firm to p e firm. The prices were up but then the prices came down. We sat around the hoop and when the opportunity availed itself, we said look well come in. It looks like youre comfortable with this kind of number. Let us do diligence. I think people are who are sellers like doing deals with us because they can trust that well stick to our numbers unless theres something that they should have told us about anyway. As we wait for janet yellen you mentioned wage growth what are you seeing in American Consumers . About 60 of our revenues are from the u. S. Theres a lot of world noise with greece but i dont think the every day consumer is focussed too much on whats going on with Interest Rates or the china stock market. I think people are concerned about do i have a steady income . Is it increasing . Am i seeing the benefit of prolonged lower gas prices. Is that putting money in my pocket, and you look at the increase of house values. I think people are feeling pretty good about all aspects of their personal economy without necessarily having a global perspective attached to it. And what about inflation in this country . Commodity prices are falling. Lower raw material costs help you. Whats your outlook on Consumer Prices . What are you doing with prices . Were trying to take prices up around the world to offset the fx impact. If you look at our commodities, theyre sloping up gradually, whether thats in metals or resins. Our tactic right now, if you look at our organic growth, a third of it is off price increases and the rest is off new revenue. Were trying to tick up prices every dau but its a challenge, obviously. Yeah. In terms of international concerns, obviously china is front and center for investors right now with some of the market strongs. The strong dollar is hurting your results and will continue to do that. Can you give us a little color on what youre seeing in brazil china, india, russia . Brazil theres a big base of operation. The economy has slowed down quite a bit but we see theres a lot of white space for growth. We feel good about our appliance business. While the economy may have issues and ups and downs, we have market share opportunities across the board whether it be in europe or asia or in latin america or brazil specifically. All right. Thank you very much. James lillie the ceo of jarden for joining us to talk about the quarter and what he says economically. Important gauge of consumer command. Thanks, jim. Thanks. Earlier this morning, robert kraft and Bill Belichick responded to the suspension of tom brady. Kraft did not pull any punches. Take a listen. It is completely incomprehensible to me that the league continues to take steps to disparage one of its alltime great players and a man for whom i have the utmost respect. Personally this is very sad and disappointing to me. Ive come to the conclusion that this was never about doing what was fair and just. Back in may, i had to make a decision i had to make a chose. I had to do a decision that i felt was right. I wanted to return the focus to football. Once again, i want to apologize to the fans of the new England Patriots and tom brady. It was wrong to put my faith in the league. Big and commissioner goodell. Put it in some perspective for me. Well its unprecedented. Really. For one of the most respected owners in the nfl to go on the attack like this. Is really unbelievable. I cant remember the last time Something Like this happened. But its warranted. And the league fined robert kraft 1 million, and took away a firstround pick. Which is unheard of. He did not fight it. Everyone assumed that tom bradys appeal would be successful. Because it seems to suspend a player four games for conduct where there is no smoking gun. Where theres no unequivocated proof. You know theres speculation, theres loose guilt here at best. Based on the wells report. But fourgame suspension is is a joke. No player has ever been suspended four games for an equipmentrelated violation. We dont know that brady did anything wrong. I think its atrocious. Im embarrassed for the National Football league. And very disappointed in the nfl. And i hope brady and you know the nfl p. A. Take strict legal action, which im sure they will. It certainly sounded as though mr. Kraft is on the warpath now and obviously he said during his remarks that he regrets not having taken legal action earlier. You obviously represent a number of clients. I think including ron gronkowski, right . Who is the patriots star tight end. Yes. How do you see this thing playing out from here drew . It doesnt seem to be done. Given that kraft came out firing on all frosts. I dont think its done at all. The nfl p. A. Did a the same thing yesterday. They had similar comments im confident that the brady and the p. A. Will take this to the federal court. It would seem to me that theyve got a very good case. This not a fair decision by the commissioner or the nfl. In my estimation. I thought a fine would have been more appropriate based on what limited evidence they have. I thought they already crushed the Patriots Organization overall. For the deflated football. To target brady with the suspension is just to me inappropriate. You know drew the point that robert kraft made again and again is the suspensions are overturned or cut on appeal if you look at ray rice and Adrian Peterson that is certainly true. But the legal theories against them or against the judgment were much more watertight some people were arguing than they would be in tom bradys case given the discretion that the nfl has. What would you say to that . I just i dont think theres any grounds for the nfl to suspend brady, i dont think theres any precedent. As i said before i dont think the league has done a good job here of accumulating enough evidence, i dont think anyone really knows what happens. And its not enough to suspend a player regardless of whether hes a star or not. Take away his livelihood for as many as four games, its absurd based upon the evidence that theyve you know that theyve put forth. And brady is obviously has not really done an overwhelming job of you know defending himself. But he shouldnt have to. And in this system it should be that theres guilt and then theres punishment. But theres not any proof of any guilt here. Drew my first thought when watching bob kraft speak this morning is how Roger Goodell was going to react to hearing him, hearing him be so scathing against the nfl. Do you think that the other owners will rally around kraft . And what could that mean for roger good snl. No i dont think the other owners are going to get involved in this. I think theyll probably choose not to comment. As they have thus far. Think this will be between kraft and goodell and its a major problem. Because kraft in my opinion is one of the top five influential owners in the nfl. You can make the argument that he is certainly one of the most powerful owners in the sport. And hes been a really strong supporter of Roger Goodell. And obviously those days are over. This is highly very unhealthy. For the league to have a key owner this frustrated, this angry. And for good reason. This is an unprecedented situation where youve got an owner in an nfl p. A. And a superstar player all fighting the nfl going into the season. When all the front pages, some of the front pages draw attention to the fact that brady destroyed his cell phone what is everybody supposed to make of that . How can goodell ignore that fact and still keep the reputation of the nfl intact . I dont recommend ignoring it. For that reason you should fine him. The fine is about 500,000 a game. Thats pretty significant for destroying your phone. Worstcase scenario if he destroyed his phone, in my opinion it doesnt merit anything more than a fine and certainly not a suspension. And thats where i think the nfl misses. I think there should be some type of penalty here. Based on what you know what evidence there is. A fine to me would make sense. Thats what i would have levied at this point or would have agreed to. But anything more than a fine i think is just not appropriate and four games is way too excessive under these circumstances. The story taking a very interesting turn today. Drew rosenhaus thank you for joining us. Lets send it over to jon fortt for squawk alley. Weve got a lot of ground to cover, twitter down 13 after earnings last night. Big questions about where the company goes from here. Management doesnt seem to have the answers, well dig in. We talk windows 10 with walt mossberg. [ inaudible ] [ inaudible ] [ inaudible ] and why stop what youre doing to find a bathroom . Cialis for daily use, is the only daily tablet approved to treat erectile dysfunction so you can be Ready Anytime the moment is right. Plus cialis treats the frustrating urinary symptoms of bph, like needing to go frequently, day or night. Tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. Do not take cialis if you take nitrates for chest pain as it may cause an unsafe drop in blood pressure. Do not drink alcohol in excess. 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