Transcripts For CNBC Squawk Box 20171115

Times square, 1970 if only it were like that. There are still those nudists around here. There are still painted people are they naked or painted . And elmo. There will be some falfafal action out there some finest how about new yorks finest showing up for us today to protect us here. Out in fum forll force not for us . We can think whatever we like. Its about 11 months in the making big thanks to everybody who put this together for us the bugs are all out. I can hear things in my ear. You . I can we can hear our own voices, which was a problem when we first moved up there its disconcerting. Im always hearing voices in my head. You had its complicated. Its the dnc usually, isnt it oh, where is the phone to call how long did it take . 6 01 59 new home for us but were still watching the markets as always things have been under pressure in a big way dow indicated down by 130 points s p futures down by 13 nasdaq off by 33 this comes after down day for the markets yesterday. We did see stocks ending at about the session highs yesterday. At one point the dow was down by 168 points, ended up closing down by 30 points. A lot of this is a reflection of what weve been seeing overseas. Airbus just securing a very big order at the dubai air show. The european aircraft maker signed a deal to sell a record 430 jets to Indigo Partners. Indigo run by the chairman of frontier airlines. The deal could be worth nearly 50 billion at list prices boeing announcing a deal today as well. It secured an order with fly dubai for 175 boeing 737 max jets with options for 50 more. The order expected to be worth 27 billion at list price. Then the consumer will be front and center today target set to post results today. Also well bring you those numbers as soon as they hit the tape dont miss an exclusive interview with target Ceo Brian Cornell on squawk on the street. What do you know about indigo based here, but they have investments around the world and lowcost carriers . Lowcost carriers in emerging markets and other places but based here . I think the headquarters is based here is it a u. S. Domicile that, i dont know. Boeing could have used that nice order i think its a u. S. Firm, isnt it technically a u. S. I dont know its okay maybe airbus gave th a great deal we have a great airplane maker here, dont we we do boein boeing look at you jawboning for america. Got a big order were all trying to Work Together ill get you details. They can do whatever they want but any way stocks to watch this morning foxconns Third Quarter profit fell 39 , missing forecasts. The company is one of apples major suppliers. The profit decline comes amid production issues that delayed the release of iphone xs sorkin based in india. Okay. So there. Yeah okay. Would have been nice all right. Fine that makes me feel better. I dont want to be an economic nationalist all the time if it had been but sometimes sometimes by the way, sorkin, i was trying to send an email the other day, i got this bizarre thing the eye with the question mark in the box you send it, it has the weird i had to do it upgrade your iphone yes theres a bug its been fixed once you upgrade it its like youre infected. I havent gotten it well talk about this we talk about these cybersecurity attacks, how reliant we are on computers, the cvs thing you mentioned at the top is a big issue with scott . Just from my own experiences, finding stuff out yesterday. Major outage over the last two days well talk about that. Cargurus Third Quarter earnings and revenues beat forecasts. The online auto marketplace is raising Fourth Quarter guidance that stock up more than 20 since the ipo. Astrazeneca getting fda approval for a drug to treat severe asthma. Clinical trials showed significant improvement in lung function and allowed many patients to reduce their use of steroids lets check the markets this morning. The markets here are under pressure thats happening because of what weve seen overseas. Look at whats happening in europe the markets that are open there at this point, the dax is off by 1. 3 italy down by 1. 5 other stocks across the board down as well cac is down 0. 6 so is the ftse. A lot of this because of what started in asia. Overnight the nikkei was down sharply. Down 1. 6 . This is the lowest level weve seen in many weeks for the nikkei it had been on a steady march higher stocks down by 1 . Crude oil prices yesterday down under down by almost 2 , the worst day in about five weeks. That morning thats continuing to drop another 1. 1 to 55. 05 for wti. If you want to look at whats happening with the markets with the tenyear, you can see the tenyear now is yielding 2. 335 . When it comes to foreign exchange, you will see that at least at this point it looks like the dollar is down across the board. Right now the dollar is trading at 1. 1844 for the euro yen at 112. 77. Gold prices, very quickly, lets look at that right now gold is up slightly. 1,285. 50. That was a quick snap back in the euro 1. 16 the tenyear down what did we say. Down again commodities weak wobbly. And just stocks pulling in junk, too junk, too. Junk bonds. Can we get some market experts in here . Oh, this is great. Joining us now, hans olson from the wealth and Investment Management business at stifle, and the chief global strategy from Deutsche Bank you have been bullish on the markets since President Trump was elected. That was in the teleprompter maybe i didnt know that, did you tell us to say that . Is it true it is true,but i would say before the well before the elections. That makes you a rare bird indeed i saw Something Else on a website this morning, it talked about some things setting up, some technical underpinnings that are shaky sure. Is this the beginning of a little bit more volatility, maybe 5 or so i think its still actually a little bit early for that. I would say the tremors this week are coming from, you know, some very slightly weaker than expected data in china thats creating a lot of sort of angst. So you see commodities in particular taking, you know, a hit. The technical issues, i would say, are in japan. Then theres no doubt theres a bit of mystery about what those technical issues are if you look at u. S. Equities, 1 from the top so were on track to become the longest rally since world war ii without a 3 pullback. You know do you think its time for a pullback it wouldnt surprise to you see a bigger one now so, 3 to 5 pullbacks happen on average every two to three months we are in the 12th month without one. We can talk about why. But all those same drivers for why we didnt get a pullback argue they will go longer. All the headlines say Indigo Partners is a u. S. Based private equity firm. Im on a need to know basis. Then i can go back to my rant. Is indigo a lowcast airline you looked up thats in india . Indigo registers Interglobe Aviation all the headlines say u. S. Private equity firm Indigo Partners im back to being mad. Go for it did you see im working on it hans, you im trying to remember im here in the United States i know. Im trying to remember with you, you i dont remember you being pound the table bullish. No. No now, reading your notes, you think this will continue because earnings were up 6 which is double what people thought i think if we open up the lens more, a correction of 5 to 10 , we talked about this. When will it happen. The conditions are ripe the longer we go the reality is that a lot is being priced in to the market now. A lot of things have to go right for us to go on with you mean Tax Reform Tax reform. No negative feedback loops for monetary normalization no policy mistakes things like that its a long list it would be unique for us to sort of transit the next six months let alone 12 months without some sort of trip up especially now as the comps started to get harder. We came out of the earnings recession last year at this time its just going to get harder to make the advances as we go from here that said, from an economic standpoint, i still think we are in the late stages of the cycle. Recession is not imminent. We have more you thought it would be tough sledding for the year. Why should we listen now, when you thought its a year later okay. You were just early. No one likes to be no one likes to be early, but the successful mon generalcy will early we stayed in the market. Started to rotate our exposures. We have taken down the high yield to zero sort of belt and suspendering this. But we participated for sure its not a question of being in or out of the market its about where youre getting paid and where the margin of safety is. You had a couple of ill use a couple of those things belt and suspendering and right out of the box, it was i dont know the language you used. Im going back to binke. I have a bit more for you is it a u. S. Based private equity frank is saying the planes are going to be assembled potentially in the United States how do you feel about that what . I dont know how i feel now should i feel half empty or half full airbus doesnt have factories here i dont understand this but nonetheless u. S. Based private equity do they get the advantage of carried interest and buying u. S. Jets President Trump came up in franks conversations with journalists, he said the american leader would be happy to know the a321 neos would undergo final assembly in mobile, alabama. In alabama, they have a 53acre facility how you are feeling now im half full, half empty now. Im glad theres some assembly here im back to getting becky involved private equity and this is carried interest buying airbus jets to get the benefit of those 23. 8 instead of the 39. 6 that everyone else pays. These guys are working it coming and going, enriching themselves coming and going buying french airliners with our tax rate. Look at you. You know, i used to make this carried interest point years ago. No, im not you thought i was the antichrist. Hes not on board with it im still not on board. The whole tax system is not fai fair youre right, if we try go about making it flatter and fairer, i dont think we should leave the highest paid individuals we pay 39. 6 or 50 or higher once you include local taxes. Thats what we include. Suddenly corporations will be paying 20 corporations is one thing i know, but why do we decide my point is why do we decide corporations should pay 20 when we pay 50. Because you you have been telling me it will lead to growth im saying for growth, you the people that think that private equity should get a break are people who think growth derives from it no, theyre not theyre lining their pockets by paying we have guests here we do have guests on the set buying and selling them later after they they had no idea they would have to weigh in on this if i had more money in my pocket, i could create more jobs, too. I look at the tax system not about fairness but for growth. If youre going to hurt the growth its not going hurt the growth of private equity maybe not final word from final word from our guests. Its nuanced. I think the u. S. Corporate tax system is crying out loud because its broken. We keep talking about lowering the Corporate Tax rate for the 35 . Im not arguing about im not arguing about lowering Corporate Taxes, but what youre doing to individual taxes. Why are we going to get rid of medical deductions that seniors rely on and the adoption thing because it will never be fair we are not getting rid of the carried interest part. Who spends more of their money . Individuals. You give them a tax break, theyll spend the money. Corporations, it needs to be reformed but who spends more money . The individuals, not the corporations im not arguing against luring Corporate Taxes you should be why should they get 20 . Its not fair if they get 20 and we get 55 they are not people. Were talking about job creating industries youre not talking about giving some of the highest, wealthiest paid individuals lower tax rates. Now youre doing the class stuff again. Im not i can understand why wait. Hold on. Make this argument to me if you take away carried interest, it does explain to me what it does to private equity at this point, if you are attracting the best and the brightest because of a financial incentive to get into the business, if they buy all these thats a separate question. I understand what youre saying. My question is why have we decided that hold on im not saying i believe this the private Equity Industry, the oil industry and the oil and gas industry is over every other industry we think it will cause growth they still pay the tax. I know they pay the tax were giving corporate individuals these are individuals i understand that we have different tax rates on whether its going to cause growth somewhere well never get fairness never have fairness. The progressive by the way, youre making an argument that none of the lawmakers who have come on the program have made the argument most dont know what it is we talked yesterday about our friend at carlisle, great individual, very charitibility he sees a reason to argue for car rid interest to stay it benefits him its not just for lining his pockets. Warren buffett has a great line oh would you ask the barber if you need a hair cut . Of course he will say you need a hair cut if you ask david should he keep the tax break, of course he should keep the tax break. If you ask Warren Buffett if he ever paid more than a penny than needed in taxes, he will say no. Apples and oranges. If were doing a massive overall of tax code, we should fill in as many loopholes as possible the whole progressive system we have here, people who make more money pay more. Were okay with that yes we should be okay with that. Theres a societal reason why we do this Hedge Fund Managers make a lot more but you want private equity to be strong but what were talking about is revising the tax code to make sure we dont pay for medical deductions and incentivize i cant understand the incentives youre talking about. Lets say that you you probably say its not possible lets say we do that and the private Equity Industry doesnt do as well for the next five years. We do it, they dont buy as many troubled companies, they dont fix as many companies. Any dont hire as ma any and they dont hire as many people. The salary they get is taxed at ordinary income. The improvements they make on the company the improvements are often slashing jobs, making sure youre cutting losing jobs along the way. Youre slashing jobs if you change the mortgage deductions hold on, do you appreciate this has nothing to do with investment money pension funds, all the money going into private equity, it is all unaffected by this i understand that the people there trying to improve, it may take five or ten years for them to be running these companies so they decided they may not do it . You may not have as many of the best and brightest going into the business. I agree with that if you cut the mortgage Interest Deduction you are also potentially hurting the housing industry which is more important to the overall economy we tried incentivizing housing, that doesnt work either but you do know that historically theres a debate about it employment from the private Equity Industry is debatable at best. Thats being charitable. You cant know what companies would have been gone completely. Thats why its debatable if youre trying to create growth im saying its nuanced anything in the tax code is nuanced. Were gooded a fixi ed at fi companies, some of the smartest guys go into that business its nuanced coming up how are you doing we might do this for three hours. We do every day, actually. Cvs consumers expressing outrage online after struggling to fill prescriptions. Becky will bring us some firsthand reporting after the break. Most etfs only track a benchmark. Flexshares etfs are built around the Way Investors think. With objectives like building capital for the future, managing Portfolio Risk and liquidity and generating income. Thats real etf innovation. Flexshares. Built by investors, for investors. Before investing consider the Funds Investment objectives, risks, charges and expenses. Go to flexshares. Com for a prospectus containing this information. Read it carefully. Throughout history, the one meal when we come together, break bread, share our day and connect as a family. [ bloop, clicking ] and connect, as a family. Just, uh one second voice guy. [ bloop ] huh . Hey . I paused it. Bam, family time. So how is everyone . Find your awesome with xfinity xfi and change the way you wifi. Welcome back to squawk box. There are a number of reports surfacing from patients across the country that they couldnt get prescriptions filled at cvs stores i ran into this firsthand yesterday when i took my daughter to the doctors office. They said the entire network was down we reached out to the company. The company said they were experiencing system connect tefitef i connectivity interruptions, but that you could still fill prescriptions. However doing that is not easy you will find outrage from people out there one twitter user responded by saying its untrue its impossible to fill while systems are down its not just customers complaining about this, some pharmacists were saying stop blaming us customers are screaming at us. This is not our fault. We cannot refill your prescriptions when the system is down like this another user said let the cvs disaster be a lesson to everyone never wait until you have one pill left or before you fill out a refill for a medication. Amen. This is really kind of eye opening, because it gives you insight into whats happening with companies all over the place. I dont know if this is a cyberattack, but it sounds suspicious i picked something up at walgreens. I reached out to dave dortmon last night, the nonexecutive chairman i asked what was going on. He got a note back from management saying this was an internal Network Infrastructure issue, as of yet an unknown cause. They said they made some changes, the problem seemingly cleared. I think it raises questions about whats going on. I think this is typical of what happens in corporations at large if theres a problem with the systems, i think about our own email system that got shut down earlier this week because too many people replying back to something that may have been a hack attempt or something coming in this is probably where its just little hard to track these things but the answers coming from management and from pr are not appropriate to whats really happening out there. I dont even know that the board completely understands the problem. Heres the good news, theres a walgreens right over there unless it was a cyberattack, and what kind of information and patient information was available. When you get over 65, you get more than five pills a day im only im only at one, its optional. You know what its about im your test case youre the canary in the coal mine when we come back, Quarterly Results from target. Numbers and reactions straight ahead. Sure, these are investments. But theyre not what people really invest in. What people really invest in, is what they hope to get out of life. But helping them get there takes a pure focus. Because when you invest their money without distraction, hidden agenda or competing interests, Something Wonderful can happen. They might just get what they want out of life, and maybe even more. Buried just under the surface, the answer to it all. We want to need each other. Not rebalancing your portfolio. Focused on what you love, not how your money will last through retirement. We make it easier to plan for retirement with day one target date funds from prudential. Look forward to your 401k plan. The markets change. At t. Rowe price. Our disciplined approach remains. Global markets may be uncertain. But you can feel confident in our investment experience around the world. Call us or your advisor. T. Rowe price. Invest with confidence. We have results just hitting from target. Earnings per share of 91 cents, coming in 5 cents above estimate, comparablestore sales above forecasts. That beat reflected in the updated fullyear outlook. The Holiday Season forecast is on the cautious side it sees Fourth Quarter profit of 1. 05 to 1. 25, compared to estimates of 1. 24. Also a quick programming note, targets Ceo Brian Cornell will be on squawk on the street at 10 00 a. M. Eastern time. To political news, Senate Republicans launching a new push to end a key part of obamacare as they try to pass tax reform ylan mui has more on this. It will get more complicated, as if there wasnt enough to debate now tax reform and healthcare are on a collision course. The new version of the tax plan would cut the corporate rate to 20 in 2019, and it would keep it permanent, but all of the major tax cuts for individuals are now temporary and it gets rid of the requirement that people buy Health Insurance or pay a pen until for the individual mandate healthcare is a land mine that tripped up republicans before. This time Senate Leadership says it is confident that it has the votes to get this passed eliminating the individual mandate also helps republicans solve a math problem the tax bill cant cost more than 1. 5 trillion over the next decade and it cant add to the deficit after that this provision does raise 3 318 billion over ten years but thats because fewer poor people would sign up for Health Insurance, so the golf would have to pay less in subsidies. The cbo estimates 13 Million People would no longer have insurance at all under the new senate plan, a lot of benefits for households would expire after 2025. That includes the reduction in rates, the increase in the exemption for the estate tax, doubling the standard deduction and repealing the alternative men mum tax. Republic minimum tax. Republicans are hoping theres enough in this mash up of tax reform and healthcare to rwin over moderate senators its all or nothing for republicans as they try to get their agenda done by the end of the year how much do you think this raises the stakes in terms of getting the votes together to have enough republicans to sign off on this. Its complicated. This does sort of increase the stakes, the political stakes when you look through the changes in the Senate Version of the tax plan, it is clear that a lot of the individual negotiations are already there theres provisions in alaska theres provisions for people working in the peninsula of egypt. Theres an increase in the Child Tax Credit that would perhaps appease marco rubio and jeff flake. You can see where theyre trying to make those calculations, and win people over on the front end as opposed to during the healthcare debate when a lot of those negotiations took place. You mentioned alaska and tax rebates for people there is that for murkowski . Yes, she was one of the holdouts in the healthcare debate this time around there was a provision that would have made it easier to drill in the arctic Wildlife Reserve that was in the budget reconciliation measure that got this process start the. Now started. Thats unbelievable when you can go through the tax code, this is to buy so and sos vote. Thats called politics. There must be something different, the numbers didnt work last time we know they didnt. They wouldnt do it again if they didnt talk to one of those people who were a no last time and have them on board mcconnell, looks like he swallowed theres also an expectation they would take up the bipartisan Alexander Murray healthcare bill that would extend payments to Health Insurers theres the idea that both of those talks would happen at the same time, but tax reform would be moving a lot faster than that thank you very much we thought it was confusing, yet it will get more confusing you can say swallow the cheshire cat walking the cake. We should let you know later this Morning House Speaker Paul Ryan will be joining us live thats at 8 30 a. M. Eastern time well get his take on where things stand now in terms of tax reform and much more. The worlds most powerful investors filing details on their latest positions leslie picker joins us good morning. Last night was the deadline for funds to file their 13f disclosures detailing individual Long Holdings at the end of september. There were a few interesting trades that emerged. Chinese internet names with a key bullish play a number of funds like duquesne and tiger global boosting stakes in alibaba and jd. Com. On the banking side, we saw several firms dissolve holdings in wells fargo, but boost or initiate new stakes in benank of america. Jack in the box appeared in a couple of filings, take positions in the fast food chain during the quarter the stock jumped pomore than 4 yesterday when the markets speculated that the new owners could push for more changes at the company. We saw other activists pare back stakes in longterm holdings david ireinhorn slashed his sta in gm, but added 2 million call options. Bill ackman sold about 13 million shares of restaurant brands, his biggest winner in 2016 back over to you guys. Thank you very much when we come back, the fda commissioner, dr. Scott gottlieb will join us about a warning for an herbal supplement you can buy at your drugstore. And at we will have greg fleming as our guest host. And at 8 30, paul ryan joins us with the inside scoop on tax reform stay tuned, youre watching squawk box on cn bc another day of work. Why do you do it . Its not just a pay check, you actually like what you do. Even love it. And today, you can do things you never could before. Youre developing ai applications on the cloud. Finding insights hidden in decades of medical documents. And securing millions of iot sensors. So get back to it. And do the best work of your life. I am the proud father of aeness very strong little girl named and do tadelaide work of your life. Who was diagnosed with infantile spasms an incurable and debilitating form of epilepsy. Its been a devastating journey that has robbed my baby girl of normal development. Thats why i have launched the my shot at epilepsy campaign and im asking you to join me. Take your shot at the hamilton pose, donate to help us find a cure, and lastly, share it on social media. This is our shot to take. Learn more at myshotatepilepsy. Org welcome back if youre waking up to the futures, its not nice if youre long or a bull futures are sharply lower. Triple digits. Its been that way not quite as bad as it was 130, 140 earlier, now 110. The dow s p down 11. 5, and the nasdaq down 30 this has been after a respite for the bulls for the last week, three, four days where uncharacteristically for the past six months or so where its been down instead of up. Maybe to be expected we are only down 1 from the highs. Exactly you look at the dow, the number is still 23,409. So well be at 23,309, maybe below 300. Is this me its you. I i expended all of my thought and energy on the markets. Theres nothing theres nothing left here. I will carry on. Making headlines, amazon has scrapped plans to launch an Online Streaming Service amazon is said to have said they cant make enough money on such a service after it couldnt convince broadcast and Cable Networks to join the Amazon Channel service. Why would they this is the conundrum that apple faced for years. You have to convince people to be frenemies, and that it can benefit them its getting so fragmented now so competitive. Did you see what barry said barry diller saying comcast is in the best position of any of these yes. Then another article saying you know what problem with at t time warner is you can spell it, comcast. Theres a lot of speculation that we could hear as early as today. So theyre saying comcast is too powerful that comcast put regulators on notice because they were concerned about it. Not that behavioral that comcast didnt do anything that they no. Everything they promised they would do they complied with. Right. I hope we dont get like europe hey, these guys, look, these guys are good at this. We have to do something. Like google, Apple Microsoft microsoft they dont have Companies Like that over there. No. Well see. Lets tell but a new fda warning. The fda is warning consumers about an herbal supplement and is telling people not to use the product to treat Opioid Withdrawal the agency is working on oversight of the herb. Joining us is dr. Scott gottl b gottlieb i have never heard of this supplement, cradum tell us what it is. Its an opioidlike substance. We think it has addictive qualities, and its being used as a way to help receive addiction. Some people are using it as an adjunct and others as medically assisted treatment to come off addiction. We have concerns we believe its fueling new addiction and if it does have therapeutic benefits, we want to see sicience that proves that. This is something i can walk into a drugstore and buy its being sold in botanical stores its being sold in coffee shops in new york city theres different forms it comes in were holding it at the border we impounded hundreds of thousands of pounds of this substance. We have had concerns about this for a long time. The dea tried to schedule it in 2016 were assessing the product. We have made that assessment available to the dea theyll make a scheduling decision based on that analysis. Its a legal product, but youre holding it at the border. What Legal Authority do you have to do that we have authorities because its a foreign unapproved substance coming in, we think it has drug like substances so were holding under those authorities. This explains a little bit or gives us insight into how complicated the whole opioid war is what other things is the fda doing now . Its a real challenge when it comes to trying to come up with ways to treat people who are currently addicted i know people are look towards kratom as a potential to ease the addiction or treat the symptoms of addiction. We knows there a lot of good therapy on the market. Three approved drugs to treat opioid addiction were open to look at new products so were putting out Additional Guidance documents and policies to create a bigger market for people who cant to come in and treat opioid addiction we dont think kratom is one of those products, but if there is science to back that up, people should come in, demonstrate that with reliable evidence its kratom as in craving we call it kratom at fda. In terms of what you hear back from the dea, how complicated is it to get this put on a list of banned substances thats decision theyll make independent of fda fda makes a recommendation to dea based on available scientific evidence, makes Public Health recommendations to dea. How they schedule is made by the dea itself are there other names that kratom is sold under i ask as a parent. Is this being sold as coffee shops and herbal supplement areas, if you wanted to make sure your kids are not using it, what other things should you know this comes from a tree prevalent in malaysia. Banned in 16 countries including sweden, germany, australia banned in two states, alabama and indiana its widely recognized as an addictive substance. 16 countries have banned it. So were a little late to this commissioner gottlieb, thank you for coming on and bringing this to our attention. Thanks a lot. Coming up, going, going, gone tens of thousands of people have been lining up at christys for vciuction viewings of a dain painting. We will talk about that next i cant wait for her to have that College Experience that i had. The classes, the friends, the independence. And since we planned for it, that student debt is the one experience, im glad shell miss when you have the right Financial Advisor, life can be brilliant. Ameriprise welcome back to squawk box. There is a decent chance well see a new record for the most expensive painting ever sold at auction. Its probably going to happen tonight. The last privately held da vinci is for sale. Good morning good morning. How many people do you know will be bidding on this tonight . Probably two. Only dwo. Its anyones guess it has 100 million guarantee on it, so thats the low price. The first bid will be 101 million, and then well see where it goes. I think it has a fighting chance to make 180 million or more you said theres two bidders. Who are those bidders . Its a good question. I think the bidders are going to be private Equity Hedge Fund this is a trophy this is not an old masters painting when you say private equity, these are executives, not firms that are making an investment. You are going to see a contemporary collector, a trophy hunter, a private equity executive, a hedge fund individual, or, you know, a syndicate from the middle east, chinese wealthy. This is a global trophy. The guarantee is in asia right now. Some people thought because its jesus you would not get asian bidding or maybe even at least bidding. Its anyones guess. The guarantee is in asia . What do you mean it has a sophisticated option contract on it the house to get the painting had to guarantee 100 million. They dont want to keep that on the books. They take it to a third party, and the third party guarantor, if it fails to reach 100 million, he is paying 100 million for it who is selling this the seller is a russian olagarc. He bought it for 127 million. It has it will go above 100 million. What about 127 . The High Water Mark ever in the history of auctions is 179 million, so it needs to breach that to become the most its tough to say to get the lot, which thief had a lot of p. R. And rkt marketing value from, they had to guarantee they had to offload their risk on to a third party what that contract looks like is anyones guess they negotiate an upside split maybe upside split above the guarantee is a very good upside split for christies maybe it isnt is it really just to generate the interest so the auction houses are in this death match its a duopoly they beat each other up over these big, big consignments, and historically its been a battle for market share yes, typically these big, big lots, theyre very expensive to get, theyre very expensive to auction, but they carry other benefits we had a bankruptcy of one of the big whats going on at the high end here . The high end of the art market the art market is many markets. At the ultra highend, theres good sentiment the auctions the last couple of evenings have been very good you know, Household Wealth is very high. The e. U. Issue wasnt as bad Global Growth is good. Economic growth at the high end, theres lots of disposable income the wealth affect. The stock market being up. The art market is in a very good space globally right now, and weve seen this big shift from consuredriven collectors to more investment driven collectors over the last few years. Thank you thanks. Appreciate it you know how when thank you. You know when the Christmas Tree goes up in rock center, its four, five stories tall. It comes from it weighs 1,400. You get all that stuff ive got some its 227 years old. It was grown ive got some facts about our set here okay. Im going to be a homer, so you know you had a problem when we were talking comcast, and we didnt talk about some of the drawbacks. You want to highlight any of them right now continue on, sir. You dont want to do any of the behavioral the long list of behavioral we can discuss that later lets do it later anyway, this set this desk is 3,200 pounds wow 3,200 pounds. 2,500 man hours to build it is a combination of computer driven hightech laser cutting along with water cutting mixed with old world craftsmanship by the way, it looks like its made out of all of the stuff beneath it is it light enough for rosco because we have a stateoftheart outside lighting control system. Not a single bulb is in this its all l. E. D i dont know if its lighted up. The sun has to come up before you can see it, but were going to do that later because i dont think the sun is up. Its called rosco. Not a single light bulb. All lightemitting i feel like its supermans lay layer. We have your list and we have this great outside lighting we can highlight. Great coming up, greg fleming what is the power of pacific . Its Life Insurance and Retirement Solutions to help you reach your goals. 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We have the latest on the Global Markets from greg fleming straight ahead a guy who knows from where he speaks and the fight for amazons Second Quarter the mayor of toronto tells us why our friends to the north will make the perfect home for the ecommerce giant target reporting a short time ago what the street is saying about the numbers as the second hour of squawk box begins right now. Our house in the middle of our street our house live from the beating heart of business, new york city this is squawk box. Good morning. Welcome back to squawk box right here on cnbc im Andrew Ross Sorkin along with becky quick and joe concernin. Were live from our Nasdaq Market site. New set in times square overlooking were calling it our own plaza right here in midtown, manhattan call is take a look at the futures right now. See how squawk square its setting itself up for the morning. The dow looks like its going to open down off about 112 points, 113 points the nasdaq off about 30 points, and the s p 500 looking open off about 12 points. Lets get you through some of the big headlines making news right now. Retailer target reporting Third Quarter profit of 91 cents per share. Thats 5 cents above estimates revenue was also above forecast. A Comparable Store sales increase of. 9 was more than double the consensus were going to have more on target supporter in just a few minutes. Youre looking at that stock in the premarket down about, well, well call it 4 oil prices there falling this morning. It comes following a report from the International Energy agency. The casting on doubt on the idea that supplies are tightening demand forecast is for the rest of this year and next year with supply seeing demand for at least the first half of 2018 then we have three economic reports that all come at 8 30 eastern time were going to get the latest numbers on retail sales. We get the prices and then the new york feds Empire Manufacturing index and the government is out with september business inventories at 10 00. Well have all those numbers for you as soon as they cross. Lots to chew on this morning big investors disclosing their latest stock positions in a batch of regulatory filings. Some of the highlights a little bit of whale watching. Warren buffetts brookshire hataway cutting its stake in ibm while upping its stake in apple. Meantime, Tiger Globals can increasing its stake in amazon and netflix while selling out of health also known as google more capital making some big bets on banks. The Hedge Fund Buying shares of Morgan Stanley well talk about that in a second then increasing its stake in bank of america and jp morgan. Appe appaloosa was increasing its stake in banks of america dissolving its stake in wells fargo. A lot of people are going to be figuring out what that all means. Also, airbus striking a huge order for 430 jets worth a total tv 49. 5 billion at the dubai air show veteran airline investor bill frank of Indigo Partners signed the preliminary order. The deal includes aircraft for whiz air, frontier airlines, jet smart, and mexicos valeris. It has stakes in all four airlines while the list is 49. 9 billion. Airbus confirmed that regretfully the private equity firm didnt pay that price with the final cost not being revealed the deal will be on a sale and leaseback basis, and he will now seek financing before proceeding with an order good deal yeah. I know in political news Senate Republicans launching a new push to end the key part of obama care as they try to pass tax reform gop lawmakers tacking on a new provision to their tax plan that would repeal the Affordable Care acts individual mandate republicans say the move will lower the cost of the overall tax package and allow for more middle class tax breaks, and the new senate plan would also make Corporate Tax cuts permanent well get reaction from all this from House Speaker paul ryan coming up at 8 30 eastern. Results from retailer target out just a short time ago as andrew mentioned earnings 91 cents a share. Thats 5 cents better than the street was expected. Revenue and Comp Store Sales are both above wall streets forecast, but it is the outlook that is concerning investors this morning that stock is now down by 5. 4 joining us right now for more is joe feldman, senior managing director at he joins us for more on the story. Somewhere between 1 and 1. 25 a share when the street is already at 1. 24 the street was already at the high end of that, and they did bring up their annual guidance, but really it was by the amount that they beat in the Third Quarter. No upwards momentum there. Its a shockingly widespread to say that were going to earn somewhere between 1 and 1. 25 why dont they have more clarity at this point . Yeah. Historically targets always given that wide range, or at least they have for the past year or so i think that they feel like its probably the middle to upper end of that. You know, usually when they get that wider range flat to 2 for the Fourth Quarter they are looking for enough comp they do have an easy comparison from a year ago. Do you think the isoff today is warranted well, the stock had traded up a little bit into the news, and i think they didnt if you look at the trends in the Third Quarter, they actually did decelerate a little bit from where they were in the Second Quarter. I think that theres probably pullback maybe some profit taking as well the retail area is such an area frought with so many perils these days were seeing great things out of amazon great things out of walmart what do you think has been happening with target . Yeah, i think target is kind of squeezed right now. A little bit in the middle between those two. Between walmart and amazon. I think walmart and amazon are doing a terrific job, you know, satisfying customer demand and what they need target is trying to transform the operation a little bit, but its still early days in that transformation a lot of their new strategy has been to come up with these Smaller Stores not the super stores that weve seen in the past what do you think of those yeah. You know, it makes sense in an urban setting. To have a smaller store, you can get in, get out more quickly i hear a lot of people in the city that use the targets here you know, definitely is a little less expensive than some of the drug stores and the supermarkets in the city, so that helps i have one near us in the suburbs, and i hate it i think you still want that big box in the suburbs you kind of need that. If you are going to get me to leave my house and actually go to a store, i want a better selection than if i drive there and you dont have what i want, im mad at myself for not having just ordered it on amazon. Right i think thats the case. I think you are absolutely right. I think the small format works in some areas, but i dont think theyll transform the whole operation to that. They are still planning to leverage the big box store, do buy and line pickup, deliver from store theyre doing what a lot of other retailers are trying to do there was theyre not up to snuff theres still a lot of work to do. Theyve improved a lot, and their mobile app is really one of the best thats out there its interesting if you look at the Third Quarter, the digital side of the business is really what drove same store sales same store sales was up. 9 periods. Digital is. 8 would you tell people to buy the stock here we would still be on the sidelines. Thank you thank you dont forget, by the way, today at 10 00 a. M. Eastern time targets chairman and Ceo Brian Cornell will be joining us cnbc for an exclusive interview all right lets give an official welcome to our guest host for the hour greg fleming, the incoming ceo of rockefeller Capital Management you kidding me that name was available . Rockefeller was available . Thats, like, solid, dude. That is big. Thats, like, a successful its rich. Its wealthy its a lot of assets under management that name was available . Excellent thats an excellent intro, and thats exactly what i thought. Its a name thats crossgenerational, which is the phrase i always use. My father recognizes rockefeller. Our generation does, and my three children look at rockefeller and have the same. Foundations i think Rockefeller University was what some of the greatest science was done when itself going to school. The Nobel Laureate you just keep stepping in it, it seems like, greg everything you do you are, like, midas, right thats nice, joe. I still need to take that wonderful name tell us what it is. Exactly how does it work how much money who is behind it what are you going to do i want to know everything. We do start with the name in everything, though, because it is a great name. I did that. I know. I want to reiterate it because its core to what were trying to do here were calling it rockefeller Capital Management, and my Capital Partners backing us are viking some smart strategic guys at viking were focused on building the premier private firm across Wealth Management, Asset Management, and Strategic Advisory well do that for High Net Worth individuals, institutions, and for select corporations. Rockefeller Capital Management will have four businesses. Rockefeller global family office, which will be the business for very ultra High Net Worth, highend families rockefeller Asset Management where they already have some great strategies, including esg, global equities, run by a guy named david harris rockefeller Wealth Management for High Net Worth individuals, and then rockefeller Strategic Advisory, who provides advice to select corporations and ultra High Net Worth families and then theyll be thinking of selling them and looking for advice. These three businesses, Wealth Management, Asset Management, and Strategic Advisory, they really dont exist in a private firm its only the big public firms that have those capabilities this will be one of the First Companies that does that provides advice across those three businesses what do i need to do to get started . No one said that to me im giving you as a possible client here the biggest opening here what do i need to get started with you you need to come to Rockefeller Center appropriately. No way. Yes you got your studio you good your offices in rockefeller. Thats your building, basically. That was named after your firm and we got all this addition additional. The tree is going to go up in rockefeller plaza. Thats your tree. Do i need to be a High Net Worth individual we are going to focus on High Net Worth individuals. Thats a problem, then. You have to talk to andrew here. I think we can maybe we can pool our resources because. Someone icon ilk, legendary, mike allen on axia he says he likes he wants to know are you willing to show your allegiance you got to pick some day are you okay change it to squawk square from times square this is complicated i dont know if you appreciate this times square is named after the New York Times. The New York Times building used to be i was getting to that thats why were asking a lot of people dont know that. What were asking is are you ready to go with squawk square in allegiance to this employer is this a more important job or not . Not deal book square this is the way i feel about this i feel like theres history here, and you dont want to we dont you said we dont he has worked for the times longer you dont know. You told me your stock has done better. You said you dont want to white wash history before. 3 00, 4 00 in the morning i get up to be with you. To be with you, joseph. A live shot of squawk square. Oh, boy big new years celebration every year in squawk square. You know that, right if mike allen decides its squawk square im going to have to email mike allen if its good enough for him, isnt it good enough for you you are going to be here for a while, greg. I have to talk to him about whats going on in the markets were going to. M a we had to get that name stuff out. The amazon analyst the target analyst, the interesting thing is i read recently that amazon last year 85 of americans went on amazon and bought something then, you know, as millennials get older, you know, they dont ever think about going to any store. Its a new way of doing business for so many people. Zhoo they. Theyre up against it retailers in general. The whole category. They have to have a digital operation as well. At the end of that interview it was spot on okay. Well have a lot more. Talking to greg fleming in just a bit. Up next, as we were just talking about, amazon, bitting for amazons second corporate home is taking place the mayor of toronto will join us he has a big pitch on why the fourth largest city in north america should be called home. Weve got that interview right after the break. Squawk returns in just a moment from our new set in teams square times square zbliefrmt welcome back to squawk box. Amazon seeking a second Corporate Headquarters in north america. Our next guest wants his city to house their hq2. Likely costs more than 5 billion and creates 50,000 jobs. Joining us now is toronto mayor john tory. Good morning to you. Good morning. You have made the pitch, as have companies or i was going to say cities all over north america. What kind of communication have you had with amazon yourself does anyone have any indicators of what they really want i think we did what everybody else did you phoned anybody you knew that had any connection to the company. We gathered as much intelligence as we could. If weve been treated fairly, which im sure we have, there hasnt been that much formal communication. They sent out an rfp document. We answered it we made ours public, which is only two of north American Cities that made their bid public we said here it is weve got a great opportunity, a region with six million plus people 11 postsecond institutions. Open immigration, an opportunity to bring people from all over the world to come and work for you, and we made our case. Now, they did clearly make it open i cant judge u. S. Politics, but i can say if you are looking at the best interests of amazon shareholders, you would say to yourself, if i can pick a margaret that has lower costs, that has the health care that we have, which is not at a cost to the company, the smartest pool of people, one of the biggest pools of tech talent in the world, that has a huge pipeline that weve committed to deliver on in terms of future stem graduates to populate that company, and on and on it goes i would say i should be looking at that as my major consideration as opposed to politics he this try to move carrier all hell broke loose this is like were trying to change the tax law so that stuff like this doesnt happen anymore. We are just presenting an opportunity to a company that says that one of the second flight time above four hours. At the end of the day i dont think theyre going to locate something thats one hour from seattle because, you know, why would you do that. Theyre also trying to might be a gateway. Trying to be a gateway to canada across the border and to be able to leverage both countries. I think it was a clever thing for them to do to sort of say that we can take advantage of some of the talent that exists on the canadian side of the border the canadian openness to immigrati immigration. We just put in a provision that can allow you to put in a visa for somebody who is a tal enthe person in two weeks and get them employed, which has been a problem elsewhere. I think it was clever to do that they dont have the same Critical Mass in terms of in one country in one city region which the Toronto Region does of tech talent Startup Community are you serious dont even get me started on that zoo a lot of people care about that now on incentives i can basically say we did not include and get into that contest because we concluded that the best thing we could do, which is in the bid, is to make a significant commitment our University System is basically in the Public Domain in addition, for example, that they dont have to pay in the Toronto Region for health care separately from their Corporate Taxes, which are much lower tlan they are in the United States. Thats our pitch. This is an issue for the United States. The percentage of College Graduates that are that have stem degrees in the u. S. Continues to suffer compared to a lot of countries, but in canada in particular, so stem has been a big focus for toronto, hasnt it been, for a long time. Again, our Education System, one of the advantages to it is that the government controls the levers in terms of what yi ncen and advance. We have science and Technology Graduates coming out of our post secondary system, and part of our bid we can make it available subject to the usual checkin to get that person to work for you right away in your business so that you can have the people you need, the talent you need to make your business go what do you make of all of the expectation thats taking place all over the world, particularly in the United States, and even just amongst states to offer different types of incentives. Fox con recently announced a big plan to invest in wisconsin. However, when you backed up all of the incentives that have been offered there, from a tax perspective, it is possible it could take 25 to 30 years for that state to actually get its money back so, i mean, you make your decisions. Were not adverse to doing that. Its been done from time to time Thompson Reuters got a modest incentive when it moved a significant part of its rnd to the Toronto Region secondly, what do you do about the next company that comes along and the next one after that and the next one after that we said, no, were going to stick to the bread and butter. A great Education System that were going to invest in to make sure that the supply talent is there. A great immigration system huge cost advantages in the Toronto Region for people who come there to work and thats what were going to make our case on what has the process been like its fairly secretive for those of us that havent been involved in it . Have you heard anything back from the company no. Not really i think they acknowledge receipt of our application so that they have it, but otherwise, we havent, and, again we are realists about this. We know that even putting the case together as to why people should come to the Toronto Region to invest, whether its in tech or anything else, i mean, this is an under appreciated and im not sitting here looking for the sympathy of squawk box viewers, but this is a six million person. One of the biggest economic concentrations of Financial Services and Food Processing and Life Sciences in north america you are playing a the whole exercise weve gone through has been worthwhile even if we dont get a second look. Im counting on the fact are you an amazon prime member not myself. Youre not an amazon you might have just that was the wrong answer well, how much shopping do you think i have time to do. How long does it take to see a specialist for not that long i mean, look, if you are in need of help right away, you get it its free up there. Check out the futures things have been under some pressure you can see the dow now down 105 points below fair value. Squawk box will be right back. 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Cme group how the world advances. Coming up, more on the kbloebl market from gustos greg fleming, and were auch watching the shares of target after the Company Reported results earlier this morning former saks chairman and ceo Steven Sadove will join us in just a bit with his reaction to the numbers. And his outlook from the retail acase adntth by spe whe io isus Holiday Season squawk box will be right back. Small businesses show their love to you. With some friendly advice, a genuine smile and a warm welcome they make your town. Well, your town. Thats why American Express is proud to be the Founding Partner of Small Business saturday. A day where you get to return that love, because shopping small makes a big difference. So, on november 25th get up, get out, and shop small. Your bbut as you get older,ing. It naturally begins to change, causing a lack of sharpness, or even trouble with recall. Thankfully, the breakthrough in prevagen helps your brain and actually improves memory. The secret is an ingredient originally discovered. In jellyfish. In clinical trials, prevagen has been shown to improve shortterm memory. Prevagen. The name to remember. Or a little internet machine . It makes you wonder shouldnt we get our phones and internet from the same company . Thats why Xfinity Mobile comes with your internet. You get up to 5 lines of talk and text at no extra cost. So all you pay for is data. See how much you can save. Choose by the gig or unlimited. Xfinity mobile. A new kind of network designed to save you money. Call, visit, or go to xfinitymobile. Com. Good morning live at the Nasdaq Market site in times square and our new set. Check it out among the stories that are front and center at this hour, Mortgage Applications rose 3. 1 last week. Thats according to new figures from the Mortgage Bankers association. The increase was mostly led by a surge in refinancing activity. The average 30year Mortgage Rate was unchanged during the week currently standing at 4. 18 . Also, amazon scrapping plans to launch an Online Streaming Service that would have bundled popular u. S. Cable and broadcast networks together. Thats according to reuters. Amazon believes it cant make enough money on the service and was struggling to get deals done with everybody this is a problem that apple and others have tried before also, Madison Square garden putting the wnbas new york liberty up for sale. The company is looking for a buyer to take over immediate operations of the Basketball Team msg, of course, owns the nbas New York Knicks and the nhls new york rangers as well as its flagship arena our guest host, by the way, has been involved in some sporting deals recently maybe he has something to say about all of this. Madison square. Squawk square. Madison square i was looking at your shot. Its i liked it i was looking behind you. I was looking at the background. Have you looked at your i havent looked at myself. Its nice to see myself. Nice look down there. Wow. Thats kind of better than the neon signs behind your head yeah. And theres a lot of activity a lot of people walking to work doing stuff. I havent seen an elmo yet, though no. I think theyre a little further. Theyre cordoned off a little further. The ratings have got to be good look at this new space. Greg fleming is our guest host this morning. He is the incoming ceo of rockefeller Capital Management greg, just looking at whats been happening with the markets right now, it must be a little bit of an intimating time to be raising money and starting things out given market valuations right here. Do you think were at expensive prices, or do you think there are still bargains to be found it is a long recovery here. This is so far the only decade in history without a recession if we make it through the last couple of months in two more years, that will be the first decade in modern history where that happens its been a long the economy is doing well, but its been a long run markets, no matter which market you look at now, whether its high yield, whether its equity markets, you know, the obvious lack of volatility which everybody talks about, the number of days is this new benchmark everybody is looking at the number of days since it was a 3 correction and an alltime high now the number of days where the markets up or down only over 1 . You know, fewer than ten this year 40 last year 60 the year before people feel good about markets, and i think some of that is explained by the economy, but i think, you know, one of the few benefits of getting older is having lived through these times, and it does feel this is what swenson was saying, from an overall stand foint to me, a little like 1999, 2006 i remember in 2006 at merrill having people say to me there are so many pockets of liquidity that there couldnt possibly be a pullback, and then, you know, in september of 2007 we couldnt sell a dollar of cdos, and nobody could raise a clo you know, it doesen tend to change quickly when it changes im not being alarmist, because it is ultimately tied to the economy, and the economy is doing well the markets feel what do you do if you have new money to put to work right now . Where would you put it youre careful. You know, and i have had this dialogue with my new partners at viking who are putting up a lot of the capital to buy rockefeller and cohen and create rockefeller Capital Management youre careful on pricing. Youre careful on things you buy. Youre careful on the way you put the capital to work. You just have to be comfortable and strategic over a multiyear framework. You know, if you look at Asset Management companies as a proxy, the stock price as a percentage of 52week high, and you are going down a list that some investment banker creates. 99 , 98 , 99 . You know, some Great Companies trading at very high prices. I wont even name the companies because theyre Great Companies, but theyre trading high the 99 analogy, im trying to figure out you think back when you saw some of the multiples, not just on the internet stocks. 50 or 60 times earnings. I just and then, you know, it was most of the we think of it as a tech phenomenon, tech bubble they were trading at infinity times earnings they werent even revenues back then i dont think im looking for the analogy. Im trying to see what pocket of the market looks anything like 99 others just the everall feeling that were expensive i was talking more about overall feeling. Its facebook, google, microsoft. Fang stocks. Amazon none of those are up on just bubbles of pockets of air. No, but if you take those five companies, microsoft, google, apple, and amazon, and facebook theyre now 15 of the s p right these are great franchises. When you start to get to that level of value and, by the way, people there was an article thorj saying amazon is going to 1 trillion, and maybe it will is apple expensive on a multiple basis you know, on a multiple basis with the cash on the Balance Sheet and, you know, tech and classic economic analysis, it doesnt this is starting to maybe 2006 is better. We didnt know what was going to hit us remember, if you also look back at these times, they started to run and people started calling this sooner. Greenspan talked about irrationale exuberance in 1996 and 1998, and it took all the way until 2000 im not saying that theres some impending near term major what im saying is its starting to feel topee across asset classes. Its hard to find value in a traditional sense anywhere as someone who spent a lot of time doing merger advice, i always think that mergers are one of the great sort of brom meters of confidence in the sea suite, even if its disconnected from reality now were at the you know, earlier this year it was terrible, actually it was shocking that nothing was happening, and, yet, in the past three months, theres been this sort of remarkable bolt of activity thats probably going to put us on pace if were not already there to the highest levels ever. Does that signal to you a top . I think, again, it signals, andrew, that ceos are confident about underlying Business Confidence and where the economy is going you know, capital is still very inexpensive. You can lever these deals. There is certainly confidence at the exact wrong time, though. That would be true also of a lot of investors i mean, i remember in 1999 at merrill raising an Internet Fund for retail in 1999 that it was 1 billion of a lot of peoples money that you know what happened to that in 2001 again, im not saying that that is happening to beckys question at the outset who was running merrill at the economy i was running Investment Banking its not your fault okay all right could have told them. Greg is our guest host. He will continue with us for the rest of the hour we have more to talk about coming up, the dangers of opiod addiction. Why realtors are turning to one company for deep background checks before heading to a showing. In the noeks hour House Speaker paul ryan joins us to talk tax reform and much more thats at 8 30 this morning. Squawk box wilbeig bk. L rhtac you always pay your insurance on time. Tap one little bumper, and up go your rates. What good is having insurance if you get punished for using it . News flash nobodys perfect. For drivers with accident forgiveness, Liberty Mutual wont raise your rates due to your first accident. Switch and you could save 782 on home and auto insurance. Call for a free quote today. Liberty stands with you™ Liberty Mutual insurance. Technology firm is raising the alarm about a new crime impacting both realtors and people hoping to sell their homes. Sounds like extreme vetting or something, diana she joins us now with more well, look, joe, being a Real Estate Agent has never been the safest job, right . You are meeting strangers in empty houses now the risk is even higher due to the nations opioid crisis. When are you talking about potentially opening up access to a home, right, to an environment where prescription drugs may lie, right, in a medicine cabinet of a house thats listed for sale, with doing no vetting or checking on an individual and giving them access to that house, i think were feeding into a crisis by creating these channels of easy access to drugs. Rileys new company, forewarn, offers real estate firms and agents deep background checks Going Forward on to its the kind of thing that san an antto dont even realtor Janet Tisdale wishes she had in she was hit over the head by an admitted dug addict who had booked a tour with her of a home he then held her hostage demanding money. I guess i always thought it was i was aware of it you never think its going to happen to you. And it does. It can it did now, forewarn ceo says this is not just about raising a red flag with this data, but a yellow flag so that if information that a client gives the agent isnt true, then the agent will know not to show up at that meeting alone. Theres lots more of this online. Realty check. Cnbc. Com. Back to you. Okay, diana thank you. For more on the ep opioid crisis, 16 Health Care Organizations have just signed on task force treatment principles to help standardize addiction care can you take private sector experience or private sector principles and apply it to this . Is that the way to do it absolutely. Then you can have success how . How so well, think about what were doing with treatment right . You have 14,000 Treatment Programs ever, and you have 50 evidencebased protocols processes that Treatment Program should be following all backed by pruchb research no one has any idea who is doing which one of these Treatment Programs or following any one of these principles basic business 101 with anything we do in business is take these 50 principles, narrow it down to less than a dozen, the ones that really move patient outcome, and put a system in place to measure it measure both who is complying with the principles, which providers, and also over time outcomes publish that on an annual basis. Payers will know who they want to have in network and out of network. Consumers like myself and all of you here will know where to send your loved one if the Treatment Programs are rated. Gary, youre involved in this because of your own personal experience sure. I was a ceo running businesses, and my older son, brian, struggled with addiction for eight years. During that time he went to eight different Treatment Programs each one was different none of nem i now know which i didnt know at the time didnt follow evidencebased protocols backed by research that i didnt know existed ultimately he passed away in october of 2011. What i saw from that was after i was able to recover from what happened and able to step back, i saw this big gap in our country of evidence i found all this existing research sitting in peerreviewed medical journals that have proven without any doubt to be able to prevent many of our teens from ever using drugs and improve outcomes and treatment all of this was in peerreviewed medical journals very little being implemented. Its like any company in america putting out an initiative and not telling anybody and not putting any system to measured results. I just saw this opportunity to help a lot of people so your Information Base and it also still is tracking protocols, still looking at outcomes, still comparing . I would rephrase it and say we are accountabilitybased. Builtability based. Any business in america, again, you would put out you would put out an initiative, and also put out the infrastructure at the same time to track results. What does work . Is it a 12step deal whats most effective . What the Research Shows first of all, it depends what you are addicted to. What about opioids, the Gold Standard that has backed now by almost two decades worth of research, and the recent reporting came out yesterday further backing it up was its medication assisted treatment is the key feature theres other features, which i can go into if we have time. The key one is medication assisted treatment through aa meetings and coming together for a sense of Community Help cant hurt but i not what does it mean medication assisted it means medication no different than someone who has diabetes who is getting insulin. Someone thats getting 103 medicine kegs on a maintenance level maybe for the rest of their life or an extended period of time. Lets say you have one of these really powerful opioids that you are addicted to, how would you do a low Level Maintenance . What would you use you would use one of three medications. Its either methadono, predoxone or that makes them feel average. Not horrible, but not great . Depending on which one of the three. They have different effects. It eliminates the cravings, and mitigates the effect of any opioid you would take. Number one number two, lets not forget the assisted treatment part. My son didnt die of an overdose my son hadnt used a substance in 15 months, and he wrote about it in a note, the shame and stigma he felt at being the bad kid. That just is not my son. That is everyone with this disease feels so horrible about themselves no one wakes up in the morning and says im going to disappoint my parents today im going to disappoint my i cant wait its a disease no different than someone with diabetes can control the amount of insulin in their system your brain functions in different ways what would be the im sure you have to follow the Cutting Edge Research as well. What would be the ultimate is there a way of blocking the receptors for opioids in the brain where they become ineffective and can you do that without having the cravings still there . Absolutely. Is that going to happen the third medication i mentioned is vivitrol, which does that. Whats the down side . There is no down side well, there is a small down side the down side is your body is not is completely blocked to opioids, and if you ever relapse and take the same amount of the drug you have taken before, thats but its a progressive disease anyway you always end up taking more. So there is slightly more risk of a harder relapse, but a study just came out yesterday, and the results showed those on this medication versus those on sevoxone had equal probability of being successful. We just talked to the head of the fda this morning he was talking about the new warning that theyre putting out about an herbal supplement that, i guess, creates a high. He thinks that that can be just as addictive as some of the opioids. What have you found along those lines . I read his research i havent done it independently. What his Research Shows and what his statement said is not only it could be equally addictive, but that people are dying from it they put out a warning because its starting to flood is probably too strong. Its starting to accelerate into this country from Southeast Asia his warning is correct we ought to heed his warning i dont know what the heck happened ten years ago that prevention is not that complicated. It really isnt. It is. Went up four times. A lot of peoples the amount of deaths has gone up six times up until a year and a half ago you could not blame the Health Care System because thats what they were being taught year and a half ago it changed cdc guideline, now theres a guideline. Any doctor now that doesnt follow that diguideline is at fault. Thank you for what you are doing. It is so doable there is bringing the private sector to this and getting this done. Thank you. Thanks for having me. Coming up when we return, were going to wrap up our special hour with greg fleming the cong cinmieo of rockefeller Capital Management well return in just a moment. What we do every night is like something out of a strange dream. Except that the next morning it all makes sense. To power global ecommerce Fedex Networks are massive, farreaching and, yes. A little magical. Fedex. Com slash dream zmoot incoming ceo of rockefeller Capital Management wow rockefeller capital before we do that, we do want to bring you some news i dont know if you saw this just now taking a 3 stake at Deutsche Bank, which is an interesting move i dont know if you have views on that. I would theyre trying to restructure and catch the tail wind here as quibble as they can. Think obviously had big challenges coming out of the recent years im sure theres some of that. I havent look at exactly where its trading versus underlying business ares, but im sure thats the theme how do you assess the banking world . You spent a large pa are your career at merrill lunch. Then more recently at Morgan Stanley. You know you will all of the players. Everybody is trying to figure out who is winning and losing right now. You know, one of the things ill say is that the businesses, back to rockefeller Capital Management, the businesses that im going to work with Going Forward, Wealth Management, Asset Management, Strategic Advisory, capital light those businesses are increasingly being rewardedby the marketplace. This evolves, as you know, in it the leadup to the credit card the trading businesses, fixed income trading was the darling, and now its. It makes me hi think they want to be bigger in stable, more feebased, although lending is not feebased its still a spread business more feebasedlike businesses they stheets where the market is going brsh. You are going to talk sports. Have we seen you on the set i did see joe zblie agreat Investor Group put together a really good board around there, and he is now ceo of the miami marlins, and he is going to fix that organization from the ground up, and it will be in a much better spot in three, four, five years baseball. There you go very timely. What a series. Great series. The astros were not particularly compelling four, five years ago the cubs werent before. Watch what derek does with the miami marlins. Thank you, sir. Appreciate you coming in on day one here first guest host on this set. Rockefeller rockefeller capital. When we come back, House Speaker paul ryan will be joining us in the next hour. Stick around well be back after a quick break. Taxes and fees included. And now netflix included. Your insurance on time. Tap one little bumper, and up go your rates. What good is having insurance if you get punished for using it . News flash nobodys perfect. For drivers with accident forgiveness, Liberty Mutual wont raise your rates due to your first accident. Switch and you could save 782 on home and auto insurance. Call for a free quote today. Liberty stands with you™ Liberty Mutual insurance. Squawk box newsmaker House Speaker paul ryan joins us to talk tax reform just before a key vote on the bill breaking Economic News two reads on the consumer and inflation just minutes away. Well bring you the numbers and the market reaction. Plus, target out with earnings were going to take you inside the big box retailers latest quarter as the final hour of squawk box begins right now. Live from the most powerful city in the world, new york. This is squawk box. Good morning welcome back to squawk box here on cnbc live from the Nasdaq Market site in times square on our new set im looking at i like my becky. I want to see yours again. Im joe concekernan along with w ross sorkin. Im going to wear red, white, or blue. I would like that flag behind me how about you . Im cool with the flag. Okay. Lets get a check on coffee cart behind you. The coffee cart lets check on the markets right now. Futures im interested here because theyre almost 130, 140. Lets see whats happening most recently now down less than triple digits. Down 7 it started in asia it got progressively worse there. Then europe wasnt great either. That comes just a few months after it took a 5 stake in commerce bank. That is germanys second largest lender cerberus is Deutsche Banks Third Largest shareholder. Check out shares of target falling in the premarket after an upbeat quarter, but a cautious Holiday Season forecast Courtney Reagan joins us now shes been taking a look through the numbers. Target did just report the Third Quarter earnings, and as you pointed out, the shares under pressure down this morning. Despite the beat across the board. The earnings beat coming in at 91 ents. Beat cob census by 5 cents then that 5 cents is actually incorporated into the full year outlook which makes the Fourth Quarter the Holiday Quarter a little on the cautious side. Target looking for earnings to come in between 1. 05 and 1. 25. Analyst consensus is at 1. 24. Revenue did also beat consensus, and Comparable Store sales, those were stronger by 0. 9 yearoveryear thats double what wall street was looking for. Also higher traffic. We should note that most of the comp strength is coming from online. Digital sales isolated up 24 theyre contributing 0. 8 Percentage Points to the comp sales lift now, target says that sales of discretionary items like apparel, those remain stronger than sales of grocery items like grocery. It will help some of the fillin trips like items like grocery. I will speak exclusively with target Ceo Brian Cornell thats coming up on squawk on the street in the 10 00 a. M. Hour theres a lot to talk about. Black friday is just next week andrew, back to you. Thank you we want to talk more about target and the retail space. Joining us right now is steve, the former chairman and ceo of saks principal and good morning. Help us through even understanding and thinking through whats happening at target, and then we can get into the larger picture you are seeing the stock down premarket already. Everyone is being cautious. You have a consumer thats transforming themselves, and the companies are saying, hey, were not quite sure i think thats in juks to position of what were hearing in the month of november its gotten off to a good start for all of the retailers youve got cold weather. Inventories in line. I think everybody is being conservative i think youre in a position you think theres an opportunity here i think youre going to see an opportunity if i were a betting person, i would probably say that the Fourth Quarter is going to be better than people are anticipating i think the jushl said that the iphone x is going to kill christmas for retailers, meaning, that instead of buying suits and clothes and all of the things that we typically buy that so much of the money and so much of the mindset of a whole new generation is no longer about what you are wearing its about what you are doing here and the experience and instagraming and all of that if you take dra 1,000 for this phone is it the x now for me its the x the ten the ten. Make up your mind i will call it the x. Im calling it the x then were supposed to call it the 10 i think electronic sales are supposed to be in the 15 range. Obviously the x is going to do very well. I think you have been seeing that for some time i think apparel sales have been the weakest part of the Retail Sector there hasnt been as much innovation is there anybody within the traditional apparel sector that you say, you know what, were just theyre on even the zaras of the world, you hear the murmurring that that may not be working the way it used to. None of it is its still healthy look at a tjx, ross. All of the value play retailers, i think, theyve been performing exceptionally well over the last year or two. You do see segments that are performing well. I look at somebody like a costco its brick and mortar. Its performing very, very well. There are segments, not just about internet versus brick and mortar and its not about just clearly its about experiences. You can have experiences across all different kinds of categories assess whats happening at walmart the reason i ask is just this week they made a deal with lord taylor to put their stuff online. Obviously it was the deal earlier before that. How do you see that stacking up over the longterm relative to amazon . I think walmart has done a remarkable job mark laurie coming in. The innovation that has been going on in that organization. Think about it not just in the stock. The stock was what, dead at 70 or so, and now its at 90. I look at it as being a company though shows its not about that a big company can transform itself whether or not it does so in terms of all of showing the brick and mortar sales, look at what theyve done. Youve used some examples. They also have technology in terms of how you can pick up theyre showing a big company can change themselves. Theyre going to be a viable competitor to am zbloj how important was the jet. Com acquisiti acquisition. When it happened, if you recall, people thought it was crazy town 3 billion was a crazy price to pay for that. Thats what everyone thought what they didnt understand was that it was about cultural transformation so much of these companies you have old line leaders who ran brick and mortar companies, who think differently than some of the internet companies, and what you needed is somebody like a mark laurie to come and change the culture. Steve, thank you for coming in this morning. Appreciate it. Lets get you caught up on some of the top stories. Check out the price of crude the shares slipping this morning after concerns about rising u. S. Crude output and a gloomy outlook for global key manned growth from the iea, and some are citing weakness in commodities for some of the weakness in the stock market, and weakness in the dollar along with lower yields. It has everyone questioning the growth story, i guess, again in Corporate News airbus securing a big order at the dubai air show the european aircraft maker signed a deal to sell a record 430 jets to private equity firm Indigo Partners. Indigo is run by the chairman of frontier airlines. The deal could be worth nearly 40 billion at this price. Square is getting in on the bitcoin trend. The Money Transfer app cash now allowing some users to test a feature that enables them to buy and sell the crypto currency jack dorsey has said that bitcoin is more of an Investment Vehicle than a means of payment. The trial is only available to a small number of users. They had allowed it and then took it off. Because of the volatility i think it was a test for them early on. This was back after probably two years ago. I think the volatility would be the hardest reason to be able to accept that you dont know if you are semg something with 20 more or 20 less than what you agreed to which was always remember, there was a time that Richard Brans branson. Senate republicans launching a new push to try and end the key part of obama care as they try to pass tax reform gop lawmakers adding a new provision to their tax plan that would actually repeal the Affordable Care acts individual mandate. Republicans say that the move will lower the cost of the overall tax package and allow for more middle class tax breaks the new senate plan would also make Corporate Tax cuts permanent. By the way, were going to be speaking with House Speaker paul ryan about tax reform coming up in the next 20 minutes or so, and this is a huge issue because its a pretty major difference between the senate bill and the house bill i assume the first look at fabio. He has not been here yet dont you think fabio will be here he may find under the circumstances. Didnt we have a lottery on when he was when he does show and does this, we will bring it to you live. Well bring it to you live. He used to hang out at our last haunt up on 6th. Everything you need to know about social media without talking to millennials Greta Van Susteren is out with a guide for dummies who joins us onet s next. Stay tuned youre watching squawk box on cnbc welcome back to squawk box. Lets get a check of the markets. Stocks have been under pressure this morning if you check out futures, youll see that right now top futures are down by 5 points if you are just waking up, that is an improvement over what we saw earlier. We were down by as much as 140 poins. That comes after a wobbly day yesterday. Stocks ended down, but off their worst levels of the session by the end of the day only down by 30 points or so after seeing declines by as much as 165 points. S p futures this morning down by about nine, and the nasdaq off by 20. If you dont belong to generation y and struggle to understand the media world, our next guest has the book for you and me joining us now Greta Van Susteren, author of the new book everything you need to know about soishl media without having to call a kid. Greta, welcome thank you nice to be here. Love your new desk thank you i have desk envy. Its ,500 pounds. I thought you were going to say 3,500, but i knew that was not the right i dont ask i dont want to know. A lot of kids are depressed from being online, and 45 have thought about suicide. Teenagers. Its from looking at other peoples lives and seeing other kids doing all these supposedly great things and maybe theyre missing out. Im worried about you ought to be worried about it sean parker said that we have no idea what were doing to our kids with facebook can you help with that i dont think you need to just worry about the children. All of us. I mean, i cant tell you how many times ive been with my husband. He says put that down. Put that cell phone down i have done the same to him. Its also adults were all obsessed with it its also a wonderful tool we can point out all the bad things, but its a wonderful tool to communicate around the world. You can learn so much. If you want to learn about the country of sudan do sudan and put it on twitter right now, you get all the people with tweets writing about sudan, and you click on the lynx. Theres a lot of really good exciting stuff you have to know google maps, when i lived in los angeles, it took me three hours to get everywhere. Now i can go on. I could have saved hours of my life there are so many other examples of what this and social media have done for us it far outweighs the negatives, or do we not know . When it all comes home to us. Whether the good outweighs the bad depends on how we use it, but the bottom line is it is here to stay its not going away. We better learn how to use it and cultivate the good because its there you might as well know the good. You know people get on and leave people have been on facebook and leaf one of our happiest anchors, kelly, left twitter, and she says shes never been happier. Are you sure that its something were never going to go back on. Even exiter i get the worst things said to me i sort of make it i dont take the bait. Thats the first thing if you take the bait, then youre cooked. Then youre down and you will have a huge fight and get all revved up yourself if you have some fun with it what i do when someone does something insulting to me, i put insult received. Now i go to the twitter swear jar, which is go that i use. Then i give them a link to my Favorite Charity if they click on it, maybe theyll give up a couple of bucks and pay for the charity. It really is incumbent upon us to move it the other way for adults its not intuitive. When i first when i thought i knew so much about social media because i was the first one to have a blog i had read a wire. It was about 2003. I asked my niece delanie who helped me rigwrite the book i asked her a question two years ago, which i thought was another sophisticated question, she goes seriously . I said, ah, yeah, seriously. You dont know that. It isnt that much of it is untutive, but you dont snap . I do a little bit, but not a lot. Thats generally for younger people do you instagram . I instagram a lot i walk down the street, and people say to me, how is audrey . Well, audrey is my dog that has addisons disease because people follow me on instagram and know about her. People know my pets. Yes. I want to get over this psychological hump of the criticism. Most people in their daily life especially when you are not on camera, i think, are not going through their day where people are constantly walking up to you telling you that you are terrible online, that happens to you, and its happening at all aejz okay. So i think all of us have been forced to sort of build up a knicker skin to deal with it by the way, some days i dont even think i have the thickest skin that i wish i did do you know what imauto saying you take the different platforms. You can read about this in the book you take twitter you can block or mute. Mute is one of my favorites because then people dont know that theyve been blocked. Or facebook. Thats the whole purpose. I want them to know. I wish bells would fireworks would go off whether they get blocked. You then invite another war. Its a ses pool go away. You know, i never hear from you again. Youre meaningless i went to his home page, and it saysure opposed to insults. Except when you are doing it i go high, you go low the lowest believe me just think, if you can reach around the world i have this ongoing fight with the president of sudan bashir who is under indictment the icc for genocide i hit him almost every day on twitter, on facebook and i know it has some impact because two years ago he sent his foreign minister here to tell me to stop tweeting about him you can have an impact if you want to. Is it is it do you have to do it it you need to have its actually a badge of honor to get to a certain number, and then you can use that in contract negotiations or something. I mean, thats just toddry look, i dont think you use it that way. What do you use it for then to make a difference like i just said, the president of sudan. I have told people on fwiter call the embassy in washington and uganda youre supposed to arrest him you can start good campaigns you can start doing good things. Then people that are psychocan be pushing some ridiculous cause, some block, mute they can have a terrible cause. Yes, of course. How do you siflt through . Everybody is on an even playing field. The people doing good, there are just as many people sewing hate and dissent. Joe, its like the phone on crack. The telephone. You can call up and do prank calls or make obscene phone calls. Its here to stay its here to stay you might as well everything you need to know about social media joe, i think you ought to buy it for your daughter you know why she might have been able to write it give it to her so she can then give it to you for christmas. Thats an idea. My daughter and son, they can both give it to me thats an idea i kmcomplain i rail theres an adjective put the phone away put the phone away look at me do they know that i know your daughter from way back we talked about it. That was five years six years ago. You need to know what the kids are doing you know, shes got shes got an angle for a selfie. I watch her doing it they practice. They know how to do it. They practice are you a selfie master i have actually we probably dont have time for, but i started a new app yesterday launched it called the sorry app, which actually plays into what you are talking about, joe. It teaches people to apologize its a messaging app they have a lot of features called the sorry app in the its do you think if i have never apologized in real life, im going to be able to do it digitally . You and i and the three the four of us we apologize in earn approximate, theyre like this at least get them to apologize like this. When i do something wrong, ill apologize when and if right . Kidding greta, thank you nice. Check out the shares of accorda. Theyre after halted enrollment and two key trials for an experimental parkinsons disease drug coming up, our news maker of the morning, House Speaker paul ryan he will join us to talk all stn. Tax reformat 8 30 a. M eaer in every town, across america. Small businesses show their love to you. With some friendly advice, a genuine smile and a warm welcome they make your town. Well, your town. Thats why American Express is proud to be the Founding Partner of Small Business saturday. A day where you get to return that love, because shopping small makes a big difference. So, on november 25th get up, get out, and shop small. Yes or no . Gin. Do you want the same tools and seamless experience across web and tablet . Do you want 4. 95 commissions for stocks, 0. 50 options contracts . 1. 50 futures contracts . What about a dedicated service team of trading specialists . Did you say yes . Good, then its time for power e trade. The platform, price and service that gives you the edge you need. 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My job is to help educate our First Responders on how to deal with natural gas and electric emergencies. Everyday when we go to work we want everyone to work safely and come home safely. I live right here in auburn, i absolutely love this community. Once i moved here i didnt want to live anywhere else. I love that people in this community are willing to come together to make a difference for other peoples lives. Together, were building a better california. With the data a littany of data this morning lets kick it off 25 and change. Came in a little light 19. 4 see controversially light. On cpi expecting up onetenth. Thats exactly what we received. Up. 2 when you strip out the allimportant food and energy. 2 cpi yearoveryear. 1. 8 yearoveryear core. These numbers are very much in line with expectations they are in certain ways a little hotter. The up. 2 on headline core is. 1 hotter than the last look. The top line yearoveryear is up. 2 from an unrevised. The 1. 8 stands alone brsh thats core yearoveryear. Its. 1 hotter than both expectations and last look lets get into some retail sales, shall we . All right. Retail sales were expecting a number unchanged we ended up with up. 2 following a revision from last look at 1. 6. Upgraded to 1. 9. If we take exautos were up. 1. Exautos and gases up. 3 the number, the control number, thats plugged into other data points is up. 3. Thats pretty much as expected its bt 2 lighter than the half 1 on the control number our last look. We do have subtle revisions on all these data points that are actually a little better with regard to the september data how did all this pan out maybe one basis point more on yields, but yields are already down from 337 yesterday and tens the dollar index of course, we have more data in the form of business inventories watch the credit risk brom meters whether its high yields here, high yield overseas. Watch the vix. Investors seem to be getting a smidge nervous i dont think theyve met a correction in a while. A lot of people probably have not, rick. Steve lease marn is here with can i first ask you, none of us have talked about this yet are you kidding me . For real for real he is under consideration. The new normal would have the fed if you want to introduce this segment by mocking the way mohammed talks, you can do that. Will the fed be able to look around corners yes at multispeed economies throughout i mean, will he still come on . He might. We did interviews with stan fisher, the fed vice chair all the time will you still baits him about the jets the whole thing you got going with him the judge et cetera and the mets would you be surprised to see that he wasnt he wasnt in the he is not he wasnt on my list of people we talked about for the new york if ed i dont think theyre close i know theyre not close to making a decision yet. Theyre still just beginning this process may not get an answer this year, by the way you are wearing that new tie. I like it. I like yours too. I was going to wear teal this morning, but then i turned it on at 6 00 in the new beautiful set. You actually made your fashion choice based on every day i look at sometimes i think about maybe matching it or yours, but, you know have you noticed this what . This with many i eyes i think we need a sound effect not sure which one another name that should be talked about that isnt m. I. It was was on the Monetary Policy expert thats another it would also bring a woman into the ranks of the Federal Reserve board. I think they ought to be interviewing her lets just talk briefly about this, and the problem we have with the data i dont know if you remember when these hurricanes came out, i said, look, for several months this is going the hurricane data is going to echo out. Let me just give you an example. In the month of september we had a 3 increase in building and garden equipment now we had a 1. 2 decrease forward it just there was a big and then whats happened with the autos is interesting new vehicle prices we have to get phil on this. Ive been trending down for five months they are still where they are. I had to look at it a minute ago. Auto retail sales are up 0. 8 after that was a big increase in auto sales after the hurricane. Remember, they had these big inventories. They came off. I dont know if you can get up at fed. One. I think the fed is on track. We still i dont think jim, who is a smart guy, is sort of leading the way on this. I think the fed is going to be set to be hiking Interest Rates in december. Then the big discussion is going to be about next year. Market has one hike priced in. The fed has three. Theres two in between theres fed make it tighter because it looks weird when you roll over from contract to contract, but when you go it goes up. It goes down theres nothing. Anyway thats been on im looking at it you are suggesting her im suggesting she be somebody to consider do you know that, or i dont know if shes being considered she strikes me as im a thought leader. Honest to god, you are. We have a thought leader is he waiting yes as im talking . He is waiting im sorry, speaker ryan thats terrible. Thank you, steve. Pleasure. I is a humble guy from wisconsin. The house is expected to vote on the house plan sometime tomorrow the senate also working on their own bill which now includes the repeal of the obama care individual mandate joining us to talk about all of this is House Speaker paul ryan and mr. Speaker, thank you for being here today thank you for kicking liesman off the set. I really appreciate it oh, come on oh, are you still there come on i try becky and guys, good to see you. Becky, welcome back from jury duty nice to have you its great to finally be back mr. Speaker, lets talk about whats happening youre voting your member hit pship is voting, and it got a lot more complicated with what the senate chose to do overnight by wrapping obama care, a partial repeal of that, of the individual mandate weve always said tax reform is really, really tough maybe tougher than Health Care Reform by putting the two together, what does that do in terms of what you have to convince your membership well, we dont have it in our bill as you know, weve passed that before here in the house weve had the house votes to do that we passed our repeal of the individual mandate back in may we never had the votes in the senate what we didnt want to do is make tax reform harder than it already is it really is whether or not the senate has the votes for this or not. Were seeing what the senate can do if the senate can get it through committee, if they can get it through the floor, then well meet them in conference and assess at that time. Right now if they were to pass it through conference, you think it would be no problem with your membership because theyve already voted on this . Weve passed this two or three times. Most recently in may do we like the individual mandate . Of course, we dont like the individual mandate right now were just focused purely on tax reform from the tax code side. Thats the house bill. Thats the bill were bringing to the floor thats what we worked out with our members. Theres a lot of things we want to do to kbroof our bill thats what a Conference Committee is all about this is the way the legislation is supposed to do. The legislative process works. The Senate Passed the bill you go to conference and iron out your reconciliation differences. Thats what we want to do. You might have speaker, thats one thing you wouldnt change weve already passed it thats good thats interesting. Lets talk about the differences, though. One of the big differences is the state and local taxes. They dont like the idea of rebating any of them you all have included 10,000 for that mr. Brady has said that he will defend that because he needs it to make sure he gets the votes from all of your membership. Thats bottom line with us. We have to do that because we have members from these particular states that this matters to we want to make sure that taxpayers in every state and every income group get relief. We dont want relief to just go to 46 states we want relief to go to 50 states all the analysis says the average taxpayer in every income group gets a tax cut im sure there are people who use a lot of deductions who have tax lawyers and accountants that may not see it that way, but the purpose of this is to cut tacks for everybody, and so we want to keep doing that, and we know that this fix is really necessary to make sure that thats the case. Yes, that is one of the bottom liends for the house i wanted you to weigh in on the repatriation issue they were asked to raise their hand in front of them about what kind of Capital Spending they would intend to do and what kind of wage growth they thought would happen my question is how then are you going to measure success if we are having this conversation three years from now, what is the measure what is the data point, the metrics with which you would use for success . Its actually totally a legitimate question, i think the status quo is were left with the worldwide tax system that penalizes companies from bringing their money back. Twouft best tax rates we are convinced that thats going to give us faster Economic Growth, higher wage growth almost a million new jobs, faster gdp growth and pressure upwards on wages 4 on average on wages that means everybodys of attacks income goes up because of that. If you are asking me, like, in 2018 its going to be 600 billion repatriated and thats going to be used for equipment i cant answer that question i do know that inversions will take off weve seen a rach of inversions and a rash of Foreign Companies buying u. S. Companies. We dont get this done, those companies that are sitting back and waiting for us to fix this tax code, theyre going to leave. The last point i would make is when you combine full expensing, which will be Effective Immediately with a rate cut, with repatriaton, it says the sneptive it to invest in america and put manufacturing in america the snentsive is to take your money overseas and invest it in america because you can write it off. Thats why we do it that way we believe companies will do that by changing the law, there are going to be some unintended consequences one i hadnt no two ways about it. Tony james from blackstone made some comments to ben white where he says the whole idea of strict limits on Interest Deduction, he thinks, are very dangerous. He says it will be the only economy in the world that has such a strict limit on deductions he says u. S. Companies will borrow abroad, build a plant abroad and hire people abroad. I would disagree. He may be talking about the 1 10 rule, which i wont go into the obscure details, but most countries, theyre doing a fin cap rule yes, i know those industries that do a lot of leverage dont like this, but we are doing an interest limitation on 30 of ebida. I know this is squawk box all talking in a wonky way we like it. We need it for a subject like this right the typical amount is ebida you can deduct 20 of your ebida. Thats where the rest of the world is going and doing tha gives us it is money we need to lower tax rates across the board and get us a 20 tax rate. And a territorial system the tradeoff is good. For those companies that want to lever up, you can lever up thats fine. Go ahead and do that where, you wont be able to deduct all of those interest costs because what that does then, we believe it makes us safer and sounder, less leveraged, more equity, less debt, healthier economy, in a 20 tax rate zr thats a thoughtful response. Tony james doesnt like the fact that you are messing with carried interest by changing it to three years instead of one. I dont think youre going far enough i mean, i think its income. Why dont you charge it. Goldilocks, right there are different shades of gray when you go et into this issue, what i have learned and i used chair this committee, you engd up doing a lot of classral damage and unintended consequences you could really mess up the real estate markets. Theres a lot of things you could mess up. Monday that actually stays there in order to enjoy longterm Capital Gains for carried interest you still have shorter Holding Period and not for carried interest we think thats the smarter policy, and we think thats the policy thats surgical and doesnt have a lot of unintended consequences hey, speaker, you are clearly steeped in all of these details, and im afraid to talk about it, but we had an interview yesterday with diane black where we talked about carried interest we asked about carried interest, and it was relatively clear to most viewers, and i hate saying this, and i dont think she either understood the question or worse, i dont think she understood what carried interest was and the details of it. My question to you is more as you talk to all of the people in congress, what sense do you have that they have this level of sophistication that you do to actually be able to wade into these issues i used to chair the weighs and means committee, and i spent my adult life working on tax policy i was jack kemps tax economist when he was a young guy. You know, some of us just had different expertise. What we typically do in congress is we look to the people wit expertise to set the tone and the tempo and the policy in this area i look to Max Thornbury on how to rebelieve the military because he knows more about it than i do. You specialize in congress thats what you do you cant be a jack of all trades otherwise, youre a mile wide and an inch thick. You specialize and look to people that share your principles and have your values on those people who specialize and work with them on those issues thats just how it works in congress thats how it should work in congress to speak, diane, she knows what shes talking about. She knows these issues shes a member of the shes a chairman of the budget committee. My guess is she probably just didnt get the question right. You saw virginia. I just want some overall comments, mr. Speaker, and whether that because im trying to think about how that would whether it would embolden or square republicans politically. Yes i could see it. Look, you have tried you didnt do obama care, or the senate didnt. People that were criticizing that, they got what they wanted. That didnt help in virginia at this point dont you think maybe you ought to just republicans should be republicans and do what they said they were going to do and maybe take your chances with that instead of trying to be all things to all people with feet of clay and just scared, oh, my god, theyre criticizing us. Maybe you actually embolden people to stick to their guns on tax reform instead of wimping out. Were voting tomorrow, joe. You see what im saying put the obama care thing in there. You didnt do it then. It is parties on the seam side as the president usually loses. How about this do something before youre not in power anymore the house has passed over 380 bills in the first ten months of the Trump Administration more than the big ones. We passed the big we passed a repeal and place of dodd frank in the summer we passed a repeal and replace of health care in may. This is tough im not hitting you from the left were bringing our tax reform will you do daca . Will that get done too will that help you in 18 or not . We are going to do a daca fix. Its going to have to have a lot of other things to it, like border and put that aside for a second sflu made a good point, which is we better do what we said we could do we ran on tax reform we know theres nothing more we could do that will do more to grow the economy and raise wages, get after tax incomes up, get Economic Growth faster, get to a 3 economy. We know theres nothing we can do like this that gets us to this kind of an economy. We know we can have. Yes, we said we would do this, and we have to do this thats the covenant we have with our supporters, the voters, the people thats why you vote for republicans. Yeah, you bet. We need to make good on this promise if were going to be successful politically, but most importantly, if we want to be successful as a country we have to get this done speaker ryan, have you already done the whip count, and are you sure you have the vote we feel good where we are we like where we are second of all, with what the senate has just done by adding this obama care repeal part of it, do you think the senate has the votes to get passed as well, or have they complicated i learned a long time ago, dont get in there and or where they are at any given moment we want them to be successful. We want them to be successful in getting their bill out of committee and off the floor so we can get in a Conference Committee. We want to give them as much leeway to do that. Its very important at this stage of the process its really important house passes a bill. Senate passes a bill then we improve the bill and get it is best possible bill in the Conference Committee there are improvements that we would like to make with passthroughs and a bunch of things we want to get to the conference and make these improvements and get the best possible bill they got to pass a bill, and we have to pass a bill for that to happen why dont you just improve it you cant get the votes . Frankly, it just takes time were waiting for score keeping. Dlr polls that show roy moore back up and that bah am bam may elect this guy what then. I cant speak to what the Senate Choices and options are you are lucky youre in the e house. Pass all the bills, remember that they give great speeches in the senate, dont they in deference, cut them a little slack, they have to do people, we dont have to do people they have to do judges and assistant secretaries of this and that and ambassadors half of their time is passing people through which takes 30 hours a person then crazy filibuster rules and its the rules they have. They have a different system than ours. Theirs takes longer. Is it better to lose there are people now in the journal and others saying it would be better for the republicans to lose that seat than to have judge moore the guy should step aside because first of all, these allegations are absolutely credible allegations so the guy should step aside if he cares about the people and the values, he claims to care about, in faithfulness to those val values, he should step aside its that simple. Okay, i know thats not your thing and you have to ask i get it. Its in the senate. You know what, speaker, people are going back and lookingat what a lot of victims claim, victims that were discredited before and written off and there may be reckoning for other areas because of this. If it fixes the situation, maybe theres a bright slide. Absolutely. Thank you for your time. Thanks for having me back as we head to break, check out the futures right now. Were still in the red getting a little bit better but not much dow off about 98 points. Nasdaq off by 19 points and s p off about ten points were back in just a minute. Welcome back to squawk box, target out with erngds and reporting Third Quarter profit of 91 cents a share, five cents above estimates and revenue was above forecast and Comp Store Sales increased. 09 and that was more than the consensus. The retailer did give a cautious Holiday Season forecast. Thats no good i mean, youve got to make hay while the sun sunshines. Well sit down with brian corne cornell, an exclusive interview at 10 00 a. M. Eastern and the best a name of the best of the ivy league schools. In difference to andrew, cornell. Did you miss that you were going to blow it off . Im not saying it for anybody else what were you doing . Good name. I was writing a note. To who . Ill tell you during the commercial break. Up next is outabt the news that might be coming back in a moment you always pay your insurance on time. Tap one little bumper, and up go your rates. What good is having insurance if you get punished for using it . News flash nobodys perfect. For drivers with accident forgiveness, Liberty Mutual wont raise your rates due to your first accident. Switch and you could save 782 on home and auto insurance. Call for a free quote today. Liberty stands with you™ Liberty Mutual insurance. Mario and luigi could be heading to the big screen. Illumination entertainment between despicable me is close to a deal with nintendo to create an animated super march row brothers movie the franchise has sold 330 Million Units over the past three decades and i dont feel like i know either one of those guys to the extent id like to do you know what makes them tick no, i dont. I used to you dont get a lot of personal contact. And the movie there was something years ago when i was a kid. Are they similar . Are they totally different guys . I dont remember. Check this out yesterday we told you about stretchy thanksgiving pants. Worst fashion idea ever. Heres Something Else that might help you out, diet wine. Weight watchers unveiling a new line called cense, 85 calories per glass compared to others Weight Watchers says a low calorie rosee is also in the works. Thats interesting. Might remember skinny girl margaritas instead of stretching pants, you could eat that new restaurant in paris. Which no. Just eat naked for thanksgiving, you dont need the pants. One way to make sure you keep to your diet. Right weve got to go. Do they do anything to chairs between goodbye, everybody. Thank you for joining us. Big day on the set make sure you join us tomorrow squawk on the street begins right now. Good wednesday morning, im carl quintanilla, futures still pointing to a weak open. Major averages poised to get red as we watch target earnings and ge down again. Cpi runs warmer than expected but empire was below estimates