Transcripts For CNBC Squawk Box 20171226

What happened in your christmas household . It was wonderful. At with my sister. And best gifts . You know, the usual what is the best gift that we could get, you know sf what is t best we could do at this point is that appropriate for Morning Television i got socks socks are good. I got some very thoughtful sweatpants i got some sweatpants how thoughtful could sweat pants be they were very comfortable. Did you get new yoga wear lululemon, yeah see, i knew that i was going to get you that, but i knew someone else would. We cant just all keep repeating. Okay. Anyway, im Andrew Ross Sorkin joe kernen is here, melissa lee is here. Becky happily has the day off. A quick look at futures. We have the dow looking like it would open down. A few days where we talk about things opening or at least looking like they will open in the red. Right now dow would be down about 32 points. Nasdaq off about 7 1 2 s p 500 off or rather up margma marginally bitcoin is rising, recovering from a selloff last week fell nearly 30 at one point on friday alone a lot of people thinking whether they should get in, get out. How many people were talking about bitcoin at their christmas dinner table saudi authorities are reportedly demanding at least 6 billion from principles alwaleed to free him from detention, that is a third of his estimated fortune. He was one of several saudi royals and government officials arrested last month. It was billed as crown princes crackdown against corruption report say alwaleed is discussing a plan with the government of accepting a large stake in his company instead of cash as pavement for hyment for. I was doing a little texting back and forth with some folks i know i thought you were going to say with him that would be good, but people that might know what is going on were they also at the ritz imprisoned the peoplie i was texting . I dont think so but none the lets, part of the issue is what happens to him afterwards meaning whether he will continue to be able to run the company as chairman, whether gets to stay in riyadh apparently he wants to stay in riyadh. That is where his family is, his daughter is there. That is his home but youd think if after Something Like this, youd think youd say i want to get out of dodge. Unless it is just nothing personal, just give us 6 billion and then go back but listening to that just on face value, if you have 18 billion but youre in prison, or you get 12 billion and youre out, you could let me out with i mean a lot less than 12. Wouldnt you but then again, people that have a lot of money, he likes running his company and you cant spend all of it anyway, so it is not just about getting and ill also say this. This is supposed to be a joke but not really that hotel, pretty extraordinary. Where they are imprisoned i dont know they have room service, but it is something but the other thing that is fascinating is while initially in saudi mbs was giving credit for removing corruption, and millennials were going crazy, they thought that was the greatest thing ever. All of this news that has come out in the past month between the artwork that he purchased and another 300 million or something on this property outside of versailles in france. Apparently it is up ending the whole sort of image issue. Anyway, more Corporate News to tell you about this morning. Theranosreceived 100 million loan from Investment Groups to avoid a possible bankruptcy filing. Its liz beelizabeth holmes say loan is subject to receiving certain targets. An investigation by the journal into its practice had led to federal probes, several lawsuits and shutdown of its testing labs new thumbs this morning on Holiday Shopping kate rogers joining us with all the details. Reporter thats right, christmas is over, but dont expect the malls to be slowing down anytime soon. In fact shopper track says today is set to be the 4th busiest shopping day of the entire season doors open at 8 00 a. M. Here and really they are expecting a ton on of foot traffic one reason is because there are a ton of deals shoppers can get 75 off at bloomingdales, target has about 70 on off of thousands of items. Best buy is marking off some commuters by 150. And amazon, you can get between 10 and 70 off of select Electronic Items now, shoppers actually had an extra day to get the last minute foot traffic rush, called Super Saturday we dont know how it faired just yet, but because christmas did fall on a monday, they did have that have a day and it was set to be the second biggiest shopping holiday in terms of foot traffic this season it was a fairly strong Retail Holiday season nrf says sales with were set to grow around 4 on the high end, up 656 billion last year and on dline ecommerce sales. And of course people are returning all those gifts. On. People usually return about 4 of the gifts that they receive unless youre a millennial, then you return about 7 of the items that you got. So that is interesting. Millennials are a little bit more discerning, is that the issue . Reporter i guess millennials are more likely to return more of the gifts but i thought 7 even is a pretty low number in terms of all the things you get, returning between 4 and 7 isnt too bad. I may have to change the size of the sweat pants that doesnt count though, does it . But that is a cost. Do we know, what i would think that costs of an exchange unto itself has to be at least a couple bucks the physical interaction of me having to deal with the other person, right . I guess im not quite sure on that one what do they do with the returns . I wont be returning anything this year. Have you worn them yet . I had to try them on. Once to figure out if they were the right size do you think clothes in the store has never been worn . Ill make you feel better i put on gym shorts first because i figured id wear the sweat pants to the gym so they had to fit over the gym shorts that is a little better but the problem was they are probably the right size if you werent wearing gym shorts so they get bunchy. Yes the length was fine. All right lets check on the markets and get beyond this. Futures indicate a little lower. 37 this morning. Although the s p is indicated up less than than a point nasdaq indicated down just under 10 take a quick look at oil kind of the same where it was. About 3 bucks a gallon depending on what you get. In you get anything above regular. There we are, 58. Ten year now 2. 49. An interesting level because if its going to 2 ppts 7. 7 2. 70 quiet im sure this week too quiet. And then there is the euro at 1. 18 everything is now were thinking about 2018 this is a week where it is a transition week where not a lot of people will be around but we will be and we have two great guests around and lets check on the broader markets in this last week of 2017 profession are on of economics at nyu stern and also founder of the 7s report with us. Great to see you i will start off with you, tom, what are you foreseeing for 2018, should we expect to see more of the rotation that we started to see toward the end of this year happen i think so. It looks like it is starting to pick up steam. And the rotation were talking about is a sector rotation two more value oriented sectors like banks, energy, and retail, those things that have underperform underperformed you look at the last month, those sectors have out perforpe and i think that can continue this 2018. Do you see stability for energy we saw a huge run in the price of brent even the past month or so Energy Stocks were more modest reporter and i think that will continue because i think that the mar get is still concerned longer term about oil. I mean we still have a long term supply problem but in the near term, youre looking at the energy spdr down 78 still year to date, so there is some value there. I think that energy is a decent place to allocate risk capital there is some value there. We were talking about Interest Rates reaching the critical level on the ten year, wondering if we will push much above that what is the biggest wild card in your view . The wild card politics politics are always the wild card and i would really worry about middle east politics all bets are off if the country goes up in flames. We have a Major Military setback. Then who knows what the markets will do and what Interest Rates might do so politics. So not a misstep by a central bank what is interesting about that statement is that 2017 politics was the wild card and then turned out to be actually a positive for the markets or they could turn out to be something that you wish you never had. So more of the same in that. But north korea too and the olympics in february. February 9, a friday you got your through the 22nd. So that is coming up too and the world will be there including Andrew Ross Sorkin yeah, well be covering it for cnbc do you think though i mean, you tell me, do you think there will be a problem during the olympics or jitters . I would say jitters leading up, probably not problem but im a mere economist im raising the political questions. I wish i had answers i just have to raise the possibilities. Is there any bubble emerging in any particular pocket im a cryptocurrency cynic. Unless they become important vehicles for International Funds transfer, i just dont see the future the technology but is there anything the bubble of cryptocurrency says about the larger market or is there is a possibility that there is enough money that if something goes wrong there, it affects Something Else elsewhere . You know, i dont see the infection. We worry about a 2008 type infection. But Financial Institutions especially banks are better capitalized. Also not exposed to bitcoin as opposed to 2008, so a different story in terms of the spread of the contagion. Thats right. Tom, ill pose the same question to you. Do you see a bubble you mentioned the rotation out off Technology Something that is working, something that has growth, is it valuation . Well, i think that is part of it i also think that were maybe on the cusp of arising economic tide so in 2017, people and 2016 also, people funneled into tech because we kind of had middling Economic Growth so tech offered growth and safety. Now as the economy appears to be coming on a bit stronger, you can go down the chain a little bit. You can go to banks, potentially energy and Consumer Discretionary because there is arising tide of growth that can help those sectors you dont need to pay the valuation premium to get the growth in tech anymore assuming this Economic Growth continues to accelerate of course. All right thanks for your thoughts, tom and profgessor. Coming up, diagnosis for health care. Well have a look at the stories to watch in the new year this is not a cloud. This is a tomato tracked from farm to table on a blockchain, helping keep shoppers safe. This is a financial Transaction Secure from hacks and threats others cant see. This is a skyscraper whose elevators use iot data and ai to help thousands get to work safely and efficiently. This is not the cloud you know. This is the ibm cloud. The ibm cloud is the cloud for business. Yours. They cahow many of em . E, sir we dont know. Dozens. All right lets teach these freaks some manners good luck out there, captain thanks but i dont need luck, i have skills. I dont have my keys. on intercom all hands. We are looking for the captains keys again. They are on a silver carabiner. Oh, this is bad. As long as people misplace their keys, you can count on geico saving folks money. Fifteen minutes could save you fifteen percent or more on car insurance. Making headlines, uber now reportedly selling its u. S. Auto leasing business to start unfair doum they are losing about 9,000 a car. They had been using it at a way to attract new drivers who dont have access to vehicles. Remember that was a big deal at one point when they were in that business in the auto leasing business. And everyone thought that was a great thing because they were giving access to drivers, but i turned around on them. Steve mnuchin gets something worse than coal in his stockings. He received a gift wrapped package of horse manure. Robert strong took responsibility for the delivery. He said it is meant to protest the federal tax overhaul adding that protests really should be funny. And so here is a question about that what happens to him . I would imagine that it is some sort of mail something offense. And if it crossed state lines, it could be federal. What is the statute youre allow dodd thaed to d . I dont know. I knew a reporter who literally got a fedex box with crow in it, the idea that you would eat the crow, like a dead bird in the mail unless you found the crow dead already, you probably that part i dont know about. Usually you deliver the manure and then ring the doorbell and run and then they have to come out and storm oig that is the old how do you know this . Thats what people do and you stomp on it that is typically well, ive never done that, but i see how it works check this out, speaking for a trend, check this out, it is a scene from minnesota warm lake water mixed with cool air can make for a very interesting sight. This is steal coming off of Lake Superior water temperature was 35, but compare to the air temperature which was 9 below zero or 31 below zero when you factor in windchill. Put it together and you see why 35 degrees is warm enough to produce steam. Pretty cool. That is pretty cool only has a few more degrees to be ice if it is below 32 it would. Depending on the pressure i guess. Two of the Biggest Health care stories in 2017, number one, cvs bids for aetna and the individual mandate which was repealed inside the tax law. Joining us for a look at these stories and what is ahead, Senior Health Care Services analyst. Aca rests on the midterm elections. An ending the tax pen allege it i brin penalty brings a real test and then they finally get to say the law is popular only took like nine years or whatever until it went from under water to where it is now when you start thinking about removing something, that is when it finally gets popular. Is the law popular now it is popular i think the exchange has survived. We have almost 9 Million People in the federal exchanges, barely down like 4 medicare is doing great. So despite all the attempts, i think the power of the subsidies is really strong which is it is an entitlement, you cant take it away kind obvious statement. Power of the free subsidies is strong where there be kind of a test, a man date one way or the other for what were supposed do will the people decide how this works finally i think the exchanges has barely moved there is bipartisan support for managed medicaid and medicare advantage. So i think that the policy down side risk on health care stocks, outside of maybe a bit of drug pricing reform is fairly muted at this point. Im sure there will be headline risk and the house flips and depending on what happens in the senate, im sure the stocks will move but in terms of really what they might do substantially, i dont think a whole lot will change. As far as i know investors go though, managed care is here to stay and no matter what happens, you think that is a i think that is the place to invest im very bullish going into 18. The tax up side is substantial it is as much as 50 an investors are saying hey, these guys will just have to pass it all on to the consumer meaning what . 50 on earnings 25 is Corporate Tax reform. And then depending on whether the insurance fee gets repealed in january in the spending bill, that is another 25 if they even took half of that to the bottom line this is all priced in they have not moved a lot if you see considering. The companies are much more bullish than investors are which is interesting i actually felt that the companies are surprised that the stocks havent moved that much every time we talk about health care in 2017, we talked about amazon is amazon on going to going to of 2018 as well about. It will be speculated and there will be an overhang inon the drug supply chain particularly i think those stocks will be pressured. The manufacturers maybe a little bit because i think that there was some pressure on the biopharma industry as well and your sense is amazon tries do this organically or well see one monday morning well wake up with a whole foods style announcement in the drug space . My call is no, they will do it organically they can do it with contracts, with mid market pbms, maybe United Health. That gives them maybe 20 , 25 of the market to start with. That a strong foot hold and then they can build off of there. And if cvs and others dont want to participate and then they are left behind because the Order Fulfillment experience is better for amazon, they may have to either improve what they have got or also contract with amazon i dont see the whole big youll wake up and same day they will buy United Health and fox in the same day. I mean right . They are trying to do media, health care, everything. Anybody going to jump that separately anybody going to jump the disney thing or not the immediate after math of that announcement, there was a lot of people who were sitting arm the hoop t around the hoop trying to figure out when it first broke since then, everyone is trying to figure out the breakup fee about that. You think it should be amazon and comcast . I always thought amazon and comcast together id do amazon as the buyer and then amazon syndicating it out effectively different pieces, like the International Assets to comcast, other pieces i might give to other people i also think major antitrust, though, right . No, no, because first of all they dont have the pipes. In this case but dhee preferentially treat comcast content. No, no, because im just telling the International Just selling the International Assets to comcast if i were the banker on this deal. You can do the back banking on United Health care. What is your fee its high how about hospitals hospitals are merging, too that continues yeah, hospitals have lost the battle or are losing the battle against the payors that being said from a stock perspective, i think there is some value there because numbers have come down a lot. The estimates are achievable tax policy is huge for them as well and they can pay down on debt, some of them are very levered. I think that will lead to multiple expansion others will do a creative consolidati consolidation. I like tentenant, universal. I like yUnited Health, but also anthem still very much they had a huge year, but i think there is still a bunch of up side and im broadcasting 20 in eps for 2020. They have a new ceo. I think shes going to drive more multiple expansion. Great thank you. Great to see you Merry Christmas. Thanks. Coming up, washington watch now that tax reform is done, what is next on the president s agenda Nick Johnston will hang out with us right after there bak it doesnt matter what kind of weather. It doesnt matter what time of day or night. When mother natures done her worst, the only thing that matters to us is keeping the lights on for you. The hard working men and women of the International Brotherhood of electrical workers, dedicated to keeping the power on in communities across the country. Because when bad weather strikes, we know what matters most. The ibew. The power professionals. Youre gaining something from meeting mr. Adderley. Its a calling to not only everybody in this neighborhood in miami, but to the nation how great we are. And how great we can be. Ill stand by you. Ill stand by you. And ill never desert you. Ill stand by you. They always refer to me as master sergeant. They really appreciate the military family, and it really shows. Weve got auto insurance, homeowners insurance. Had an accident with a vehicle, i actually called usaa before we called the police. Usaa was there handson very quick very prompt. I feel like were being handled as people that actually have a genuine need. Were the webber family and we are usaa members for life. Usaa, get your insurance quote today. [music playing] welcome back to squawk box. U. S. Equity futures are a little lower as far as the dow, down 32 s p continues to be up just fractionally 0. 68 and then the nasdaq is indicated down about 12. It appears that this years Holiday Season was a strong one for retailers. Figures from Mastercard Spending pulse showed a 4. 9 gain over a year ago covering the period from november 1 through christmas. And that is the biggest year over year increase since 2011. But a lot of people were feeling flush because of all the companies sucking up to the Trump Administration you mean the dough fubonuses minimum wage increases thats the way that it has been written everybody that did it has a problem. They are all sucking up. Wells fargo is in trouble, at t wants to get its deal done in defense of this because he was the first to do it, id put him in a different category also because he used to come on this show religiously and say that he would do this. And hes a boy scout and so he is one of these people who i really i genuinely believe that he said to himself i said that we were going to do this, they did it, and im working my end of the deal as well that is good. Because in the past, like when his emails end with dont taeks and drive, you have sort of questioned his boy scout motivation at times. You remember no, i believe him on that . I just remember you made some sort of cynical remark pchb. If i made a cynical remark remark he is a legitimate boy scout. And i was saying that for you because the cynical msm i think there were other companies that were a little less boy scoutish. How about that like which companies . Warren buffett likes to say praise by name, criticize by category im going to stick with that this morning in a very holiday spirit i think trying to curry favor with the administration by raising minimum wage, that is a permanent commitment, not just a one time bonus i would not thank you any companies that actually raise the they wanted it so badly for so long. I said it is great. It is a permanent commitment. It is now just 1,000 right now. It is great Merry Christmas. And werewatching shares of apple this morning according to published reports in china apple has told suppliers that the iphone x sales for the Current Quarter will total about 30 million compared to 50 million that is interesting. Because you they had said 2 018, 1 trillion for apple. Finally. Wouldnt be surprised. But we said it five years ago. It should be at 2 trillion by now according to those analysts, right . And it is not there yet. It may get there, but i still think long term when you have amazon, google or i dont know i think id take amazon or google or even microsoft really anywhere you go, like im at the gym or something, iphones going off all over the place everybody has one on that. There is a sound of an iphone dropping that makes a because we were on the train and were not all sitting together my kids always drop their iphones because we keep buying them, getting new screens and everything and so we were on the train and we heard it. And its like it is unmistakable and it was somebody else dropping the iphone, but it has an unmistakable sound. Especially the x with the glass front and back have you ever cracked one the screen . Like every other day its a real problem. And there is a sickening feeling. I never have ive never dropped it and my charge has never gone below 60 i dont think. Live a sheltered life because i get too nervous charge achnxiety id be so anxious what if you have to make a phone call or receive an important email or text or something . What if youre not reachable for even five minutes . Scary. Tough going President Trump notching a big legislative win officially signing the swooping tax reform bill over the past couple days now. Nick johnston, axios editorinchief, good morning. Weve been trying to spin this story forward. Rather than looking back, we want to understand where this is all headed and what comes next well, the first thing i think a week from today the president has already said he will start convening senior advisers to talk about infrastructure. Something that they maybe should have done before the mess of health care and doing taxes. But infrastructure is secertain top priority for the president what im fascinated about is whether he will make a deal with chuck and nancy on it. Mitch mcconnell said he only wants to focus on things where he can get bipartisan assume and support. And which you can achuck ande in the business of wanting to assume the president now that is a great question. Ask me in a week i think chuck and nancy are definitely interested in something that will put hundreds of bills into districts across the country and solve the crumbling infrastructure problem. But what will be fascinating to see is what they have to do first, some kind of deal on immigration with the d. R. E. A. M. Ers. And if that gets contentious, i can see the president sending mean tweets toward on chuck and nancy which could make it more difficult. Or sid and nancy. Do you remember that no. Talking about mean tweets, a little fbi drama over the weekend on twitter yeah, the president had some free time. This is something that weve been a lot about the inside game and outside game as were approaching this fbi investigation and special counsel investigation. For the inside game, it should be over soon, the white House Keeping a strong face saying there is nothing wrong and the outside game where they are trying to delegitimize the investigators more broadly going after them on television, on twitter, enlist people on the hill to criticize. And he went after the number two guy. Which is something i mean, weve never seen a president on twitter do that before i think it speaks to some of the unprecedented nature michael help said it is not normal for the president to attack career agents like that but i dont see it stopping. In a vacuum, i might say that you cant see that there are some things going on with this guy . He should retire i think, right, given you dont think you think this is just a concerted effort by fox news to disparage the fbi . You dont think this guy has some conflicts that are so laid bare in the last six months . It is undeliverable. There is search is certainlyt to spread more uncertainty but if there wasnt there, there would be nothing to use. You can look at what happened after the president made the tweets, the number of career government officials from both sides of the aisle who came to his defense. There is nothing they 1450 be in the position they are in and with they needed an insurance policy in case this guy gets in . Your eyebrows arent raised . If you dig down, they were on both sides of the political aisle. And those people are out but it does spread a cloud of uncertainty which is the president s allies will use to cast aspiratiersions across the broader investigations and i want you to weigh in on north korea 2018 keep an eye on it we havent talked about that a lot recently i think that it is very important to continue to watch china, continue to watch the diplomatic efforts at the u. N. With nikki haley there is a lot of generals i think who are being reported as some not necessarily frightening, but interesting things about what they fear is on the horizon rex tillerson, in or out . By the end of the year . Im not by the summer. Im a short term trade are here. Our reporting has said that he will probably be out sooner raefrn la rather than later, so yeah, id short him. Speaking his mind usually we get different investors that come on and they say, well, im a little down on this, but we should still be constructive this was just a straight call. Bring me back in six months and see if im right well have the conversation appreciate it. Merry christmas. You too coming up, you feel like bit quoin is taking over the world you are not alone. A Company Wants to use its Block Chain Technology to change the way health care works. There he is. Your new brotherinlaw. You like him. Hes one of those guys who always smells good. His 5 oclock shadow is always at 5 oclock. You like him. Your mom says hes done really well for himself. He has stocks and bonds. Your dad wants to go fishing with him. Your dad doesnt even like fishing. You like your brotherinlaw. But youd like him better if you made more money than he does. Dont get mad at your brotherinlaw. Get e trade. You myour joints. Thing for your heart. Or your digestion. So why wouldnt you take something for the most important part of you. Your brain. With an ingredient originally found in jellyfish, prevagen is now the number one selling brain Health Supplement in drug stores nationwide. Prevagen. The name to remember. Hello there friend hi hey there. Im an Imaginary Friend of a kid just like you. Youre going through a lot right now and i know youre scared. But youre stronger than you know. But look, well get through this together. And remember. We at the Imaginary Friends society always have your back block chain may prove a useful solution confronting data sharing challenges joining us is the ceo of health wiz, a mobile platform that provides customers with tools to organize and share medical records. Great to have you with us. Glad to be here how does this work . Because youre using the ethereum technology. Thats correct. So what we have built is electronic file cabinet for your Health Records on your smartphone and we provide the tools and help people to edit their medical records, organize them and so that they can be shared seamlessly and securely on a block chain. So from the consumer or the user standpoint of that app, what does that interface look and feel like . Does it feel different from any other app that you might have where you type in a password for instance no, it looks very similar to other apps we just want this app to be something that people can carry with them wherever they go, they are never left without a recent copy of their Health Records no matter where they are, whether they have Internet Connection or not. And be in a position to securely share it with people that they choose to share it with on a secure block chain so in terms of keeping that safe from say hackers, this cannot be hacked at all, correct . So the block chain cannot be hacked what we do is we put the transaction so when you decide when you choose to share your medical records with someone, that transaction gets logged on block chain and the block chain cannot be hacked it is security the medical data itself are transmitted on a secure channel that is not on block chain so on block chain, you have the transaction, the record of the transaction. And that cannot be hacked. So the private ledger is there to keep record of the transfer how does the consumer actually have possession of those records . Do they have for instance the equivalent of a private key . Exactly so today there are government mandates in place where consumers have a right to their medical records from different places the problem is that our medical records are scattered all over the place. Doctors offices, some in hospitals. And now we have even more data with our fitness trackers. So the tool we need is to really aggregate the medical records on our phone and have them available to us in case of emergency or if you are traveling. And make it accessible on a block chain so that we can share them securely. The one thing about the private key which is probably a great thing in terms of security and also a bad thing is that it is only the user who can access that private key you have possession of the private key, you own the records. If you needed on to access those records and youre injured or uchb coff unconscious, what happens then well, so the records are on your phone and if you are injured and if somebody gets to your phone, they can use your biometrics to get access to the phone. And himself talso the technologs available so you can still access the phone even though you are injured. The records on the phone themselves are secure, but not secured with keys. The keys come into play when you actually share them on the block chain. So on your phone the records are visible to you so they could access them locally on the phone got it fascinating stuff. Appreciate your time coming up, living in luxury, high end trends that could shape 2018 dont leave us stay tuned youre watching squawk box on cnbc when this bell rings. It starts a chain reaction. Thats heard throughout the connected business world. At t Network Security helps protect business, from the largest Financial Markets to the smallest transactions, by sensing cyberattacks in near real time and automatically deploying countermeasures. Keeping the world of business connected and protected. Thats the power of and. Dad promised he would teach me how to surf on our trip. When you book a flight then add a hotel you can save. 3 waves later, i think it was the other way around. Everything you need to go. Expedia. For her compassion and care. He spent decades fighting to give families a second chance. But to help others, they first had to protect themselves. I have afib. Even for a nurse, its complicated. And it puts me at higher risk of stroke. That would be devastating. I had to learn all i could to help protect myself. Once i got the facts, my doctor and i chose xarelto®. Xarelto®. To help keep me protected. Oncedaily xarelto®, a latestgeneration blood thinner. Significantly lowers the risk of stroke in people with afib not caused by a heart valve problem. It has similar effectiveness to warfarin. Xarelto® works differently. Warfarin interferes with at least 6 bloodclotting factors. Xarelto® is selective, targeting just one critical factor interacting with less of your bodys natural bloodclotting function. For afib patients wellmanaged on warfarin, there is limited information on how xarelto® compares in reducing the risk of stroke. Dont stop taking xarelto® without talking to your doctor, as this may increase risk of stroke. While taking, you may bruise more easily, or take longer for bleeding to stop. It may increase your risk of bleeding if you take certain medicines. Xarelto® can cause serious, and in rare cases, fatal bleeding. Get help right away for unexpected bleeding, unusual bruising, or tingling. If youve had spinal anesthesia, watch for back pain or any nerve or musclerelated signs or symptoms. Do not take xarelto® if you have an artificial heart valve or abnormal bleeding. Tell your doctor before all planned medical or dental procedures. And before starting xarelto®about any conditions, such as kidney, liver, or bleeding problems. Its important to learn all you can. To help protect yourself from a stroke. Talk to your doctor about xarelto®. Theres more to know™. Welcome back to squawk box. Its a season now to look ahead to the new year. Lets focus on luxury. Here is cnbcs robert frank. Reporter 2017 was a boom year for the rich. 2018 is likely to see the frot grow even bigger boom time for billionaires the number of billionaires and millionaires is likely to reach an alltime high the millionaire population is likely to hit a record 12 million. The number of billionaires in the world is likely to top 2,100. Their combined fortunes topping 8 trillion. Trophy assets. All that wealth is likely to drive stronger sales of everything from art and diamonds to super cars and Luxury Real Estate 2018 will see a rising number of big deals at the very top of the market over 30 million might even see a new record for the most expensive home ever sold several properties on the market in this l. A. For over 200 million. And the richest man, jeff bezos to remain the richest man in the world as amazons dominance grows, pulling even further away from his billionaire rivals bill gates and Warren Buffett his fortune currently around 100 billion, will likely top 120 billion, and his new rival on the rich list will probably be facebooks mark zuckerberg, who is currently worth 75 billion, but could add another 10 billion or 15 billion to his fortune. That was cnbcs robert frank. Special night coming up on cnbc its the premier of the prophet in puerto rico, an american crisis when hurricane came in september. It cut many residents off from medicare as part of a new documentary, cnbcs the prophet, marcus lamonus profiles the volunteer doctors working to reach the island the question isnt if were crossing, but how . Not down here, but over here. Were the strongest nation in the world and were trying to figure out how to cross a river to bring people diapers and water. 42 days after the hurricane. Right here, guys. Something somebody need help child is sick . The National Guard isnt wastesi in wasting any time they had to cross with supplies for the family now its our turn. Official death toll in puerto rico from Hurricane Maria is now 64, but the through figure could be much more than that see more about the islands epic struggle watch the prof it in puerto rico, an american in crisis tonight at 10 00 p. M. Eastern and pacific. Now to the Weekend Box Office the force was with star wars the last jedi brought in another 100 million over the last weekend. According to estimates from comscore, and jumanji, welcome to the jungle, debuted in second place. That had 34 million. Pitch perfect 3 was in third place. Check this out. Did you see any movies, by the way . I havent i cant believe how much last jedi has pulled in so far. Almost 400 million. Its been out 11 days. They say i keep reading that its not way down from the last one, right . Havent you seen things like that no, it is it is. You have any movies . Are you going to do any holiday movie watching usually do new years eve we go mollys game, the sorkin film you feel like you have to go to that . Because of the namesake no were not relatives. Way back, youre not. The post is a newspaper guy i would ilike to see the post. Critics say that the movie that replaced that kevin spacey was in all the money in the world is speupposed to be spectacular. He stepped into it just to see how it was shot so quickly it was weird because i think christopher plumber is, like, 85 playing geddy, and kevin spacey is, like, 50 something playing the same guy wonder with makeup, which we all know about coming up, this mornings top stories including new numberofs Holiday Shopping stay tuned youre watching squawk box on cnbc taking care of a Family Member can lead to plenty of questions. Fortunately, theres a place to get the answers, for them and for you. Find articles, tips and tools from experts and others who have been in your place. The Caregiving Resource Center at aarp. Org caregiving. Good morning, everyone christmas is now officially in the books. Were counting down to 2018 just four trading days left of the year, and stocks pointing mostly lower this morning a full market run now straight ahead. Plus, bruised apple . Bruised apple. Shares falling 2ers after reports of weak iphone 10 i call it the iphone x why are we calling it the iphone 10 the danger of the returnathon if you are sending that not so stylish sweater back to the store. We have a warning for you. I have some stuff to return. Well talk about it. The second hour of squawk box begins right now. Good morning. Welcome back to squawk box here on cnbc live from the m Nasdaq Market site in times squa square does he call it the 10 or the x . The Company Calls it the 10 melissa lee Andrew Ross Sorkin becky is off the nasdaq down about 30 the s p now down 44. The s p continues to trade fractionally higher. Less than half a point the nasdaq indicated down 18 President Trump tweeting moments ago based on the fact that the very unfair and unpopular individual mandate has been terminated as part of our tax bill, which essentially repeals over time obama care, the democrats and republicans will eventually come together and develop a great new Health Care Plan we will see. We check the tenyear, which is right around 2. 5 2. 49 last time we looked 2. 492 right now. The dollar 1. 1851 it will be interesting to see which way it heads then oil 58 another interesting range that well see for next year. 55 to 70 or 55 to 40 for crude . We will know, but not i say it again and again it becomes more and more appropriate that predictions are hard, especially especially about the future those are the hardest predictions. Just happens to be. Right arent they much more difficult . Has to be nobody goes there anymore way too crowded. Making headlines this morning apple shares are under a bit of pressure on some reports that sales of the new iphone x maybe the Company Calls it the 10 apologies if you do. Stick with me here theyre apparently slowing taiwans Economic Daily news reporting that apple is forecasting sales of 30 Million Units this quarter according to a prior forecast of 50 Million Units. Apple has not publicly disclosed Quarterly Sales targets for the newest iphone, but i do want to say i love these i know im a little fan boy, but these little headphones Great Holiday gift. I dont know what kind of margin they get on this because i think theyve got to be pretty expensive to make, but fantastic. Bitcoins wild ride continuing prices rebounding after bitcoin had its biggest weekly decline since 2013 take a look at this chart. Prices this past friday, they dipped just above 1 1,000 from a high last week ran into a guy who is really doing arbitrage on bitcoin they have people in london and new york and other places because in new york it can only be coin based. They buy on one exchange and move it around theres no Computer Systems to do it so its very old school. Theyre typing in the order here then theyre emailing all of the information with the keys and everything to the guys in london they are then selling it its not like theres no room for error its just very its the old way of buying something across the street and then going and walking across the street and selling it the difference between bit snap and coin base right now is about looked like 200 or so. I mean, it did that all day long intill may lose a longstanding distinction this year based on preliminary sales figures samsungs electronics will display intel as the number one seller of semiconductors theyve been the number one chip maker. The stock is still up 29 overall this year. New figures out on Holiday Shopping according to master card spending policy u. S. Holiday sales rising 4. 9 , and e kmerszsales jumped a whopping thats the strongest holiday growth since 2011. Starting off strong. The holiday closed out strong, right, on Super Saturday, and this is another big week zoo this is another big week 40 of holiday sales always occur between december 15th and the 25th you cant forget january because the redemption of gift cards people spend more than the actual gift card amount. A couple of things happened this year we have fewer stores open on thanksgiving day it led to a sense of urgency over black friday weekend. The lull that you have between thanksgiving and the 15th, you had a lull, but it wasnt as deep consumers have the ability to spend. Retailers want them to spend in all our tracking of going to the stores, watching the web sites, the level of promotion seems similar to last year it didnt hurt that it was cold outside. The seasonal weather helps sell cold weather goods is there any sense as to whether or not its a broader base of consumers spending i mean, weve got Consumer Confidence at 17year highs. We have unemployment at 17year lows are lower middle income folks spending more this year . It seems like its both the lower end and the higher end thats spending. When macys hires 7,000 additional Seasonal Sales Associates on december 1st, we havent had that before. When you have had some of the lower tier retailers, like the walmarts of the world, doing nicely also in addition to the highend, thats encouraging now we go into the first half of 2018 yes, tax reform, but you also have easier comparisons and leaner inventory levels. Its more fullpriced selling that well see in terms of the stocks, weve seen a runup in the past month. Whats factored in a macys 20 run over the past month. A gap up 16 nordstrom up 16 in the past month. Is that all in. You have some Short Covering thats happening we had a real split personality in 2017. First half performance weak. Second half performance strong i think we can keep going. Typically the Fourth Quarter and the First Quarter is the best performance for retail names so can you overlay sort of do the calculus here the ones with the strongest online presence, the ones that will benefit the most from tax reform both on their own reduction corporate rate as well as their consumers reduction in rates. Retailers are one of the highest segments with the heaviest taxes, so Companies Like gap, like tjx, almost on the Department Stores with kohls and macys will all et get a benefit from tax reform. Youll see the l brands and lulu lemons those companies with a lot of american exposure, thats when it will do the best. Now theres the article in the journal questioning kevin plank being able to run lulu and Plank Industries when you have Companies Like nike and adidas spending money in order to grow in north america, thats where the growth is, and underarmour, once you lose exposure and demand by the consumer, it takes a longer time to gain it back. Is this a shoe story or everything story its a little bit of an everything story i dont think of it as a shoe story because they were mainly clothes to begin with. Theres a view among some that perhaps they stretch themselves by going too far in the shoe category, which was not their specialty, and had they focused just on clothes and maybe if they returned to that focus, they can fix this problem. Still very much a work in progress its the core business thats still weak in addition to the shoes. So in terms of what weve seen direct to consumer, are the likes of a footlocker and finish line, i mean is that a losing battle its not a losing balgs because you have some areas of active that will are doing well. Take a look at lululemon whose physical and digital is strong take a look at gaps threathlet, which is doing nicely also whether its gap that has type of built into it or some of the other names out there, its impressive look at lbrands and pink and what theyve done with Victoria Secret sport its made a difference great to see you. Thank you. Happy holidays. Ups and fedex scramble to get packages to your door on time. Morgan brennan has a delivery score card and what we can expect for returns another busy time, morgan. Yes, thats right its almost like phase two, peak season lets look at what happened over the weekend. Its still early in terms of details. Were going to get more of those as the day unfolds coming into christmas, ups and fedex did scramble to get packages, though it would appear with fewer challenges than in years passed. Fedex sent out a Service Alert warning wind shear had caused disruptions at the main express hub in memphis that could result in delays. The company saying it could ek tend the delivery operations in some parts of the country affected by Severe Weather then it expected to have all the scheduled deliveries completed on december 24th now, prior to that it had not planned deliveries past saturday, the 23rd, but keep in mind fedex has in years past worked well into Christmas Day this is a positive development for approximate s after a record thursday at its main air hub in lieu ville, it was delivering packages on saturday in some markets where weekends according to the wall street journal it repurposed several hundred office staff to help get packages to doorsteps this Holiday Season its something its done in the past, but apparently not to this extent peak season, as i just mentioned, is not over yet we have returns starting cbre estimates 15 to 30 of Online Purchases are returned versus 8 for brick and mortar purchases as Online Shopping continues to surge, so do the return shipments that is spurring big demand for reverse logistics by the companies. Ups, fedex, Xpo Logistics and others that do specialize in it, and, actually, ups says that their busiest day for returns will be next year, january 3rd do they still charge the peak season surcharge in this phase of the shipping season no. So ups put in those First Time Ever peak season surcharges. It was for very specific weeks in the Holiday Season. That last week coming into christmas and also the week around thanksgiving and cyber monday its going to be interesting to see what the earnings tell us this year. Morgan, thank you all right coming up when we return, you may have missed the story over the weekend. The high price of prince al walids freedom. Well talk geopolitics with Evelyn Farkas. Youre watching squawk box here on cnbc the moment a fishs pulled out from the water, its a race against time. And keeping it in the right conditions is the best way to get that fish to your plate safely. dane chauvel sometimes the product arrives, and the cold chain has been interrupted, and we need to be able to identify where in the cold chain that occurred. tom villa we took our world Class Network, and we developed devices to track environmental conditions. This device allows people to understand whats happening with the location, but also if its too hot, if its too cold, if its been dropped. Its completely unique. dennis woloshuck if you have a sensor that can keep track of your product, it keeps everybody kind of honest that way. Who knew a tiny sensor could help keep the food chain safe . Authorities were demanding at least 6 million for prince a alwaleed to free him he was one of saudi officials who was arrested last month as a crackdown on corruptions reports say that alwaleed is discussing a plan with the government about accepting a large stake in his company, kingdom holdings, instead of cash, as payment for his release. A number of other saudi royals and others were released apparently over the weekend, but alwaleed not wuf those not cash. Thats interesting to be free he will sign over, like, a stake in his company then they dont have to sell any of the shares. Its a liquidity problem. Right people work because there are so Many American companies. He owns the biggest Media Company in the region. By far i thought they would have wanted that for strategic reasons i thought thats what this was all about. Perhaps not. Well see. Thats better than there was some chatter before that it was liquidation of his stakes to put pressure on the markets. Its a laundry list of just well known u. S. Brand names. Yeah. Remember he used to enon all the popular some of them i wonder whether they were Great Companies or whether he just was buying just hollywood strange things that he bought. Remember he also owns separately the four seasons theres a whole number of businesses he does, yeah joining us right now is former Deputy Assistant secretary of defense Evelyn Farkas good morning to you. Good morning. Just because we were talking about saudi before we get to the rest of this yes the United States and President Trump in particular has had a very Good Relationship with saudi and specifically mbs in all of this how do you think the public and the Business Community and others should look at whats happening there right now . This crackdown on corruption seems to be cutting both ways in that there might be some corrupt actors, and thats a good thing. On the other side we keep hearing these stories about nbs buying that 450 million piece of art, the chateau near ver versaille in france. I wonder worry about what he is buying and how he is living its more about what he is doing dpesici i domestically and internationally. I think cutting down on corruption, yes, we have to keep an eye on that because it could be, like, taking a book, you know a page out of the china book weve seen chi do that as well he could be doing the same thing. Again, for the United States maybe were not as concerned we want stability in the kingdom. More importantly, i think it is what he does in the region and how he plays into the whole tension with iran. Last month i was in israel, and im worried about whats going to happen next with regard to syria and how and the saudi kingdom has an Important Role to play, obviously, when it comes to the future of arabisraeli piece and the regional dynamic im worried that he may not have all the information and may not understand the full picture in the region if i could just say one thing, just with regard to israel, we really need to be careful about what happens next because they are counting on the russians and us to somehow restrain iran and hezbollah, which i think is a kind of pipe dream do you see when netanyahu was on twitter doing a twitter thing from jerusalem over the weekend. Did you see what i was talking about . I didnt see it i dont know what it was like a periscope style video of him, and they were talking about anyway, my question to you is trump in israel, whats did, and whats happened in terms of announcing the capital . I think the capital move had nothing to do with whats good for israel or the region or for u. S. Foreign policy, honestly, because it read to me as some kind of campaign pledge. It undercuts what we understand Jared Kushner was trying to do with mbs in saudi arabia and others, which was one, you know rg moving towards some public support for israel to show the arab street to say, hey, we can accept israel. Moving us closer perhaps to pie peace, not getting there overnight, would have been a good move, but now with this announcement that he made, its hard then for the saudis and other suni states to say, hey, we accept israel and show that though their people. We probably cant mention ez bowl without bringing up the latest what was called project cassandra and politico were you involved with that in any respect in terms of, you know, it was not an investigation because it may have hurt the iran deal . I mean, were you part were you in the rooms when that was being discussed . I have to confess, i dont know what article youre talking about. I didnt work on iran policy when i worked in the administration, i worked primarily on russia. There was obviously overlap with syria, and in 2005 i was in the pentagon when we watched what the russians were doing and made our you havent heard a word about this politico story, the secret about how obama let hezbollah off the hook an am birns u. S. Task force targeting the ran headlong into the white houses havent seen that . I confess, i havent read the article. You know i do read a lot of news, but i cant read every piece, even by politico, which has published me a lot, and im thankful for them i will say that obviously i cant speculate on that story, but i think what we need to focus on now is theres a lot of instability. You mentioned International Institutions what im worried about and i have a piece hopefully thats going to run soon about the National Security strategy, i think for businesses they really need to focus on some institutions and really do whatever they can to help strengthen institutions domestically and internationally. The only hope if you are a business is predictability, is rule of law, internationally and domestically, and i am afraid that institutions are being placed under assault across the board. Im really worried internationally about nationalism. I mean, thats the biggest problem right now in europe. Weve also got the old tensions playing out. We have nationalism where russia is challenging the International Order primarily in europe. Plus, china also, but not quite as aggressively. Then we have the Korean Peninsula and all these other tensions i think for businesses they need to watch how institutions handle all these problems and the existing tensions. Russia, china, north korea. The story of 2018. Which one were you 2018. Crystal ball. Russia. Russia. Good to see you thank you very much, andrew coming up, the gift of making dreams come true. Were going to talk to the ceo of make a wish found aation rig after the break. Squawk box will be right back. The market. But through good times and bad. At t. Rowe price. Weve helped our investors stay confident for over 75 years. Call us or your advisor. T. Rowe price. Invest with confidence. Let out your inner child at the lexus december to remember sales event. Lease the 2018 es 350 for 319 a month for 36 months. Experience amazing at your lexus dealer. When this bell rings. It starts a chain reaction. Thats heard throughout the connected business world. At t Network Security helps protect business, from the largest Financial Markets to the smallest transactions, by sensing cyberattacks in near real time and automatically deploying countermeasures. Keeping the world of business connected and protected. Thats the power of and. This is the season for making dreams come true david williams, the make a wish ceo. The organization is in the midst of its peak season not everyone knows exactly what make a wish does, but there are children that maybe have what type of kids qualify for make a wish how do you do the screening and the selection . Its sad, but. Every year in the United States, about 27,000 kids are diagnosed with a lifethreatening medical condition. Their world is turned upside down make a wish comes along, and we ask a very simple question if you can wish for anything, you know, what would it be while the mission is simple, what happens is it allows a kird to think about something besides their illness. It allows a family to be able to kind of come together because we involve every Family Member in these wish experiences, and, you know, one of the biggest misperceptions about make a wish is that if you are eligible, then you must have a terminal diagnosis. Actually, that misperception is because thats the way it was for a number of years. Its very exciting, very positive how do you if people want to help at home, whats the easiest way to go to our website wish. Org. They can make a contribution there. We also are able it utilize frequent flyer miles if your miles are expiring, and you want to a lot of business folks are watching this who probably have all kinds of miles theyre never going to use when theyre given to us, the Expiration Date goes away, because threequarters of all of our wishes involve travel. Thats a very big expense, and if we can use miles for that, then any kind of cash donation goes even further. A lot of times individuals give in kind donations it takes the cash and stretches it even further. There are those who donate low basis stock. You know about this . Do you like that . Do you hate that whats it cost for you of that i think sometimes to myself that if i were to do Something Like this, it would put a strain on you. Not its the processing of having to deal with it. We have people who can do that, and its great because its good for the donor, obviously. Its certainly good for the organization were thrilled to be able to get donations of stock whats the average cost of granting someones wish . So, about the cash portion is about 5,000 the in kind portion is about 5,000 there are some wishes that are much lower if you think about some of the simpler i wish to be a policeman or i wish to be a fireman or i wish to have a puppy or Something Like that, and then, you know, we might have some kids that might want to go to the olympics, and it might be a large family. Then, you know, we got a lot of work to do of those to try to do everything we can. Are you sending a child to the olympics every both winter and summer oemgz. Weve got one coming up that were going to have to take a pass on because of a lot of things typically thats a wish that we grant. Disney, they are big gives. Huge. Whats the value of their giving between 10 million and 15 million a year we have a tremendous number of kids that disneyland, disneyworld, disney cruise, meet a disney celebrity, and they are amazing. We just had a big promotion end yesterday. Share your ears. 5 came to make a wish there was a charitable deduction that was maintained, but the doubling of the exemption means less people will itemize. That could affect middle class giving, but its a very charitable donation. We are. I think its one of the things that we take for granted in this country that it is part of our dna to give. Its expected of corporations, individual do it well see it with our millenials, and one of the things people dont realize is we have also encouraged giving people who give through their wills and estates, through annuities, they said do i want my money to go to government, or do i want to go to a charity, and we receive a lot of gifts for that thats goodbye going to be kbaked as well do you know about bunching donations. Because of the increased deduction, people will bunch their contributions so maybe this year you might bunch all your contributioned by double up or triple up to get over and then maybe next year youll go quiet and then the next year and so it could create sort of an uneven pattern of giving do you have any questions about the new tax law and how to you are better than any accountant for someone who loves high taxes, for anyone that likes high taxes and wants the government to collect, you have the best stuff you are unbelievable you know stuff that the reverse back flip that allows you to bunching is the new term. To find out all these its all avoidance. No evasion to avoid this and officially give away their money. Okay. All right. Just do you have any questions well think about it. Stay after the show be well worth your while david, thank you this is one of the great organizations. It is it really is. All week on cnbc were opening up our annual playbook heres phil lebeau with a look at the auto sector auto sector still, trucks and suvs will remain popular picks in showrooms close to gas prices that remain relatively low meanwhile, you can expect sales of electric cars to charge up in 2018 thanks to two high profile vehicles first theres teslas model three which will be seen around america more often as the automaker ramps up production. Meanwhile, gm expects sales of the chevy bolt to increase due to a full year of nationwide sales. Finally, expect to see plans for selfdriving cars to expand in the next year. Waymo will start its selfdriving ride share in arizona and grow it from there, while gms selfdriving cheffy volt will go from the streets of San Francisco so new test drives in new york. Other automakers expect their autonomous drive programs to kick into a higher gear next year, setting up 2018 to become a crucial year for an Auto Industry going through a technological transformation phil lebeau, cnbc business news, chicago. Worldwide spending on air travel is expected to rise 6 by the end of this year equaling about 1 of economic output joining us now seth kaplan, managing partner at Airline Weekly full planes. You know, jet fuel not as expensive as it was. It is a very good time to be both in the business and to be a traveller, isnt it, seth . It is. Whether you go china to newark, it takes an hour it looks like with boeings overtures th overtures, those great jets that bombardier make. Both of them are great you get on and off quickly you dont wait on the runway as long it seems like were moving that way, right right you are never going to fly a cs 100 from beijing to new york, obviously, but, yeah, when you look at the larger aircraft, the smaller of the line body aircraft of the twin engine aircraft are doing fine. The a 380 for airbus, the giant one that you are talking about that airbus clearly struggling yeah, its corporate travellers like frequencies. For example, you know, they dont want to hear you have the biggest plane. They want to hear how many times a day can they take you from new york to london if the meeting runs late. Yeah, often that means smaller aircraft, although in the narrow body space we do see airlines pushing more into the larger 737. The larger variance of the a320. Kind of a dichotomy. We had robert frank on talking about how luxury is going to be even more paramount next year in 2018 and, you know, we know how well people that owned assets have done over the past, you know, with the fed at zero 12 million millionaires. Do we get more with air travel, or do we get more, you know, first class versus everybody else i just how does that play out . Airlines are clearly a bunion it starts with air travel, and you can everything up to the sky. Its interesting we have here in the past few years seen airlines restoring certain things you think American United and delta. At least two of the three of those airlines in every case have gotten rid of free buyer every beer, wine, on long haul flights. You got rid of premium entertainment for free you know, the snacks all those types of things. In all cases at least two of the three of those have restored all that in the past couple of years. We serve free economy meals on transcontinental flights again these are airlines that now that they are doing so well, do have the luxury to restore certain things its never going to be the old days again where you can transport hundreds of dollars worth of baggage basically you know, what it would cost to ship it for a 39 ticket they dont think that makes sense. They have actually put certain things back that in some small ways make itation more ill tell you the reason i like andrew will appreciate this, and i will admit i like the small jets because none of them have first class so you dont have to, like, try to get in first class its so hard its interesting psychology that makes people that curtain makes people want to do things upgrades dont work miles are useless. I dont wish anymore its like everybody is in the small plane. Everybody is in the small scene. Thank you we appreciate it he knows what im talking about. Up next, todays top stories. Plus, a warning for serial returners. Check out the futures. We head to the first trading session of this holiday shortened week dow jones looking to lose about 67 stay tuned tada hello there friend hi hey there. Im an Imaginary Friend of a kid just like you. Youre going through a lot right now and i know youre scared. But youre stronger than you know. But look, well get through this together. And remember. We at the Imaginary Friends society always have your back good morning welcome back to squawk box here on cnbc, live from the Nasdaq Market site in times squa square among the stories that are front and center this hour, an acquisition in the pharmaceutical industry and that was announced just this morning. You u. K. Drug maker mallinckrodt is buying sucampo pharmaceutical 18 per share. Sucampo is based in rockville, maryland the deal should add to allinckrodts earnings immediately. Also, a record run in the Airline Industry profitability, though, could be in jeopardy. According to the trade Group Airlines for the purpose america, expenses at the nonlargest airlines rose more than 8 during first nine months of this year same time revenue rose over 3 airlines paying more for fuel and maintenance and then for those of you that went to the movies, the force was too much for the competition at the Box Office Star wars, the last jedi took in nearly 101 million. Ticket sales bringing in domestic total to 400 million also, doing well, the remake of umanji and Pitch Perfect 3 also doing well when we return, we have a lot more coming up a big warning. Youre playing the mall to return to gifts today, i am not even doing that. The details right after the break. Stay tuned youre watching squawk break on cnbc call right now to receive your free information kit with no obligation. It answers questions like. How a reverse mortgage works, how much you qualify for, the ways to. Receive your money and more. Plus, when you call now, youll get this magnifier with led light absolutely free when you call the experts at one reverse mortgage today youll learn the benefits of a governmentinsured reverse mortgage. It will eliminate youronthly mortgage payments and give you taxfree money from the equity in your home. And heres the best part. You still own yohome. Call now take control of your retirement today 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. Now a warning on returns. Thats right. Full 10 of holiday sales are returned, and today is usually the biggest day of returns all year, but be careful when you return that unwanted gift because youre being tracked, and you might get a oneyear ban from any future returns at your favorite store thats because theres an equifax type company that rates whether you are a problem returner its called the retail equation. Its main goal is to help stores stop fraud, like people who repeatedly wear something and then return it crooks trying to get cash for stolen goods, organized crime printing fake bar codes who change the prices on expensive dumz regular shoppers who do nothing wrong, they might get caught up in this too if they return something that might match a pattern displayed by crooks. The company says 25 of the top 100 retailers use this service including best buy, Victoria Secret, jc penney and nike thats why sometimes you are asked for your drivers license. There are 600 million returns, and the retail equation says 99 some innocent shoppers might get falsely banned if that happens, you can contact the company to get your return history and ask them to reinstate you. You are blocked what happens is you first get a written warning on the receipt saying you are now placed on warning. Any future returns might get blocked. The next time you come back to best buy or something theyll say, oh, sorry, its just blocked. You got to go talk to them because we as best buy, we dont do this. It will be a written warning on your receipt if i dont have the receipt the tags are still there i have the box theres a lot of Message Boards for people or a lot of local stations that have done investigations on behalf of the customer and said i have everything normal. I have the box i just forgot my receipt i buy things from here all the time, and they still locked me i dont understand you really need a gift receipt. I find its uncuth because im not even sure youre going to like it go ahead and return it is that what happened wr yesterday . A little bit. A little bit i wouldnt so you like gift receipt better than cash in a Perfect World i would like everyone to figure out what the size is and everything in advance, but its very hard. Yoga pants that he tried on why did i regift them no. Somebody else is going to wear the pants that he tried on. I want somebody to buy the ones that you want you want the he had gym sports on underneath yeah, yeah, yeah thank you nice to see you Merry Christmas this was, by the way, true news you can use i appreciate that. Sure. Theoretically this is the real deal this time thats what im talking about. Lets bring in tobin moore, toro cofounder. Toro works with one of the top u. S. Retailers to process returns. What do you think . Have we got this that was a pretty good report from eric, was it not . Im really curious as to what happens to those yoga pants. Yoga pants. Could they end up someone else wearing them i mean, is that i think theres a lot of places that can end up what do companies do when they get sent back so returns are becoming a have been but are becoming an even bigger issue in retail, especially with the growth of ecommerce ecommerce return rates are triple that of typical returns, and so you end up this year were going to see probably 380 billion of products alone and close to 750 billion worldwide. A major portion of that is going to happen over the next week and over the next month here employing back going back tof the pants, do the pants get sold at a different price or to somebody else . What happens those pants will come back, and theyll get checked out by a clerk initially who likely will take the return because the battleground for Customer Experience now is seeping to Consumer Returns then theyll assess is it used or not used . Does it still have a tag on it based off of the different condition factors, the item will end up in a number of different places average cost to the retailer of the rush meaning the handling and the fact that i have walked can be a good thing. Maybe ill buy Something Else there. Whats the average cost of a return so it just starts at the clerks desk and then it goes the goods get shipped back to a Distribution Center and sometimes it get crossstocked at a ford Distribution Center. Were talking 5 an hour. Is it Consumer Electronics and it has to be white or refurbished or is it like yoga pants and it has to do a sniff test, and they can put it back on the rack. Exactly thats where we were going this entire time. It has to cost them something to do this a couple of dollars so you can put it back on the shelf thats what happens to the most apparel, and retailers have a bigger challenge today when a lot of these goods were bought online and now you are returning did to a storefront that never carried it in the first place. Now they have to figure out what to do with it, and a lot of times they cant even restock it in that store. I tried to fold them back the way they came. Thats very considerate like origami. They send it back to a dry cleaner and come back and get thank you thank you. Appreciate it. You were supposed to read that i wasnt ready tobin is your guy. Thanks. Were talking about coming up in the next hour, the big business of College Bowl Games what a dip in ratings might do 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. Looks like we have a couple seconds left. Lets do some card twirling twirling cards e trade. The original place to invest online. I used to have more hair. I used to have more color. And. I used to have cancer. I beat it. I did. Not alone. I used to have no idea what the American Cancer Society did. Research . Yeah. But also free rides to chemo and free lodging near hospitals. I used to maybe give a little. Then i got so much back. I used to have cancer. Please give at cancer. Org. 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. Coming up, jobs, taxes, and politics in 2018 well hear from former cku restaurants ceo Andrew Puzder after the break. Check out shares of apple under pressure this morning. Iphone suppliers are also in the red. Weve got all the Details Behind those declines next. Take a look at the futures right now on this tuesday session. Looks like we are going to open up lower across the board. Youre watching squawk box here on cnbc the moment a fish is pulled out from the water, its a race against time. And keeping it in the right conditions is the best way to get that fish to your plate safely. Bacteria can multiply to high enough levels that even cooking it will not destroy all of them. Its definitely the most important thing in my business. How fresh is the fish . Where it comes from . How it gets here. The more i know, the better. Sometimes the product arrives and the cold chain has been interrupted, and we need to be able to identify where in the cold chain that occurred. We took our world Class Network and we developed devices to track environmental conditions. This device allows people to understand whats happening not only with the location of that asset, but also if its too hot, if its too cold, if its been dropped. Its completely unique. We ship fish, beef, poultry, vaccines, insulin. This is about monitoring and protecting everything we ship. I catch all this amazing, beautiful fish and then once its out of my hands, i have no control over what happens to it. If you have a sensor that can keep track of your product, it keeps everybody kind of honest that way. Its really all about the network. You are looking at trillions of transactions a year. Not too Many Companies in the world can even scale to that type of volume. Who knew a tiny sensor could help keep the food chain safe . Food has to be fresh. Its that simple. Zbloinchts tax reform, check market rally, check. Whats next . The prospects for washington and wall street in 2018 straight ahead. How big hedge funds are franticly trying to get in on crypto currencies. Unwrapping the retail story Holiday Shopping season. Winners and losers 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. Just barely down. 0. The nasdaq is weak down almost 36 points. Treasury yields are on the tenyear 248 now. 249. 248. Got up 2. 5 last week briefly, but now back down below that the stories investors need to know about, shares of apple getting hit this morning it this follows a report that says apple has told suppliers iphone 10 for the Current Quarter will total about 30 million. That compares to 50 million last quarter. Sky Works Solutions they are reportedly demanding 6 billion from prince bin alwaleed he was one of several saudi royals and government officials arrested last month in what was billed as crown Prince Mohammed bin salamons crackdown. Among the other market stories, bitcoin is on the rise its recovering from a selloff below 12,000 on friday among stocks to watch this morning, mallinkcrodt they keep giving you this story. Sucampos shares on reports that it was fueling takeover offers. Brookfield Property Partners seeking to restructure its offer for part of mall owner ggp that it doesnt already own the offer it made last month was half in cash, half in stock. The ggp said to be wary of epg accepting brookfields stock in its current form now to washington and trivia question what do kambucha, Broadway Musicals and florida citrus have in common . They all get special carveouts in tax bill. The legislation stands not only to transform the code for large swaths of the american economy, but it also doles out special gifts to even the most we have the details good morning, joe i have combed the tax bill, checked it twice, and now i found out who has been naughty and nice were going to start with the Beer Industry here tucked inside the legislation is a provision that lowers federal exize taxes on brewers for two years. The small brewers, the tax gets cut in half. For others the taxes reduce by 10 . It has bipartisan support, but it was ohio senator rob portman that delivered this gift this christmas. Its also not just beer. Broadway getting a new tax break as well. Live theatrical productions, they will get to take advantage of full immediate expensing of the show this is actually a tax break that was passed under president obama and was championed by new york senator Chuck Schumer and it was fired at the end of the year, and cnn has also made a stop at florida citrus farms they get a carveout for replacing damaged plans. This is particularly important after the hurricanes that occurred this year growers have been upset. They still havent gottin the full Disaster Relief backage yet, so maybe this will help tide them over for a little while, and one elf who worked on that was Verne Buchanan who happens to be a member of the Tax Writing Committee in the house. These are just a few of the presents that the industry has found. Im sure lobbyists are still unwrapping them all. Back to you, guys. Will you find anything in there for agencies, i guess, that like talent agent fees well, apparently i am still checking through all the fact lists, but apparently it looks like you can no longer write off the fee for your agent i dont think youre going to find anything in there its good sear, joe. Its okay its all right just calling it talent is do you feel weird when you say it, talent thats presumptive wu presumptive. Its like calling a bald guy curly. Or skinny for an overpetition person former cke no offense, andy wrrks former cke ceo policy advisor for America First policy weve talked a lot you know whats great about getting your take. You know exactly how carl i love carl jr the bacon western bacon cheese berg cheeseburger you can speak to a couple of things that happened after the law was signed, and that is number one, some companies immediately went to 15 minimum wage thats tough on fast food. If its federally legislated, maybe less so if you are able to do it. Number two, im sure as a Domestic Company your tax rate was, you know we hear that America Companies dont pay that 35 . You must have been pretty close at cke, werent you . Well, we were pretty close once when i took over, we had a lot of losses. The company was in real trouble. Once we used up the losses, we were close to that i would say even more importantly than whether cke restaurants, which is a franchise was paying a lower tax rate all of our franchisees are getting this lower tax rate, and i what i i have been friends with some of the people for 20 or 30 years, and when i talked to people in the franchise community, theyre all talking they used to talk about i cant open you know, labor is going to be too high theres not enough growth. I wont have sales now theyre talking about whether they can find sites to open theyre all out there looking for ways to grow, new places to grow youre really seeing ab snen incentive to grow with regulatory reductions and tax reductions this bill is a big deal, and i think people are going to see that in the coming months. You think that you you saw a couple of companies go to 15. Yes the fast Food Industry is still an entry level position for a lot of people. I dont expect its going to go to 15 immediately at a lot of the franchise outlets. I dont know if it will go to 15, but i will tell you you can see this driving around. If you drive by almost any fast food restaurant, and you see a help wanted sign out there theyre trying to hire people, and here in nashville, i know were paying a lot higher. The minimum walk is the federal minimum wage, and i know were over 10 an hour for workers you are already seeing an increase in wages for people, which is what we havent seen since the end of the recession weve seen wages stagnate. These Companies Going to 15 an hour for because Economic Growth supports the wage, thats absolutely the way to go i wish everybody was making more money, and if you have the growth to support that wage, so businesses can continue to grow and continue to create jobs, thats a very positive thing i think were seeing with the growth were seeing employers keep for workers, which causes wages to rise. What weve seen for the past eight years is workers competing for jobs which caused wages to stagnate or something down this is a very positive sign i dont take it ill at all i think the fact that First Third Bank and wells fargo are going to 15 an hour because they believe they can is a very good sign. Listening to you talk about the tax bill and then listening to, i dont know, you could talk to Larry Summers or chuck and nancy, i dont know, Rosie Odonnell wants paul ryan to go to hell for christmas. Some people some guy sent mnuchin a load full of manure. Is it the same tax bill these people are looking at on the one hand versus the other . I mean, says if you depending who you listen to, its either the biggest tax cut for the rich and this totally skrug over everybody else, or its an across the board how do you decide what it is . How do you not take a partisan approach to it there are people criticizing the tax bill obviously they havent read the tax bill there was actually a good segment i saw it on twitter where one of the other networks, a major network, interviewed three people from across the country. A woman that made 40,000 is an executive assistant. Two educators made 150,000, and a couple with a Small Business in california where they made about 300,000 all of them found their taxes were going down, and all of them thought they were going up i think when people start to see those bigger paychecks in february, all of this malarkey about this is a stop to the rich and its going to hurt the working and middle classes are going to go away the real part of this bill it wasnt just giving a tax cut to people, and people needed a tax cut. That was the right thing to do, and theyre going to see that, but this is a bill that is supposed to generate Economic Growth president kennedy has rich, poor, working class, middle class. Lifts everybody. The taxes will be lower theyll be able to see that. It will be meaningful. Only 5 of americans are going to have the tax bill go up in the shortterm i think, though, to the extent theres a critique of this particular tax bill, its the only way were going to measure it longterm is both in the growth and its ability to pay or not pay for itself and whether taxes go up later. Its a harder bill to measure in that way in that in the immediate term, people no matter what are going to feel better. The question is whether five years when we look at all the numbers were going to feel better or worse. Right . Thats true i think if there had been more support, if this had been more bipartisan like the kennedy tax cuts or the reagan tax cuts, we could have accomplished some of those goals. The problem with this bill was republicans had to pass it on very thin margins. You find things in the bill that you would prefer not to find i think even if you look longterm, and one of the criticisms, obviously, is that these tax cuts go away in a number of years. Look, congress can change that you know, Bernie Sanders is upset about that as he said over twitter this week. Have him come out and say, look, ill support a bill that makes this permanent i dont think republicans would object to that you have to have people crossing the aisle to make this the kind of bill we would all like to see. I think its a great bill, but it could have been better if there had been some bipartisan support. Okay. Andy, thanks thanks, gentlemen he so you Merry Christmas. Merry christmas a lot still ahead on squawk box this morning. The year of Cyber Attacks from yahoo to the mega equifax hack well talk to you about what to predict in terms of data 2018. Then, later, why congratulations may be in order. It has nothing to do with golf stay tuned bcqukeronching saw he cn eet guy. Whats the hesitation . Eh, it just feels too complicated, you know . Well sure, at first, but jj can help you with that. Jj, will you break it down for this gentleman . Hey, ian. You know, at Td Ameritrade, we can walk you through your options trades step by step until youre comfortable. I could be up for that. Thats taking options trading from wall st. To main st. Hey guys, wanna play some pool . Eh, im not really a pool guy. Whats the hesitation . Its just complicated. Stepbystep options trading support from Td Ameritrade 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. For more on what to expect and how to protect and predict privacy for the new year, leo tadeo. Chief Information Officer at cytera see, im i read it, like, six times. Its also former fbi special agent. Let me ask you this. What do you do with your own im curious. Thats a tough one. I try to wherever i can use multifactor authenticate on email and certainly on my own personal devices having them as locked down as ponl. Email is the vektor that most hackers are going to get locking down your account and making sure youre not clicking on any links or visiting web sites. Thats the way to protect yourself so multifactor just for those who are uninitiated means that youre not only having a password, but also often times getting a text message or something from the provider so there are two fornlz thats right. Theres usually either a token or the person you are trying to communicate the company youre trying to communicate sends us a different my second question is some people now say that the texted version of the multifactor authenticate, meaning the second password effectively that gets texted to you, that thats no longer safe. That true . The National Institute of standards and technologies has deprecated sms as a second factor yes, thats true to some extent. Its still better than nothing its very hard to break down an sms message and spoof it so that you can get ahead. You lose any Services Like last pass or Password Managers i think Password Managers are a great idea i use one password, which is a great management tool, but thats a great way to store complicated passwords without having to write it down on a piece of paper doesnt that put you completely at jeopardy in that if you lose your password or, rather, if someone can hack that account and then they hacked your whole life. Thats true if they can get into your password manager, they have access to all of your pass words. Theres no doubt you just have to manage it right. All the multifactor until the cows come home there still would have been a huge breach. Once you send your information to a third party, its very difficult to manage how they protect it. Once equifax lost once you hand your data to equifax, in most cases consumers dont even know and thats part of the reason whats the piece of information in all of our lives that we dont appreciate has more value meaning, we hear about these big braechz, but then, by the way, you dont hear necessarily about how that breach has impacted the individual except that you feel exposed. I think Identity Theft is still the most personal and impactful victimization from a hacker point of view if you can open up a credit account in someones name, that affects the persons credit and their ability to theres infomercials even on cnbc and everything for all of these services that are trying to protect your identity do you know what im talking about . Worth it not worth it theyre all better than nothing. No particular and Single Company is going to keep you safe. You have to do your best, and you have to manage your own security what monitoring does is assist you in understanding what else is coming at you, whether its someone using your Social Security number or open a line of credit in your name those things help, but theyre not foolproof final question, liability in the corporate end. What do you think is going to happen longterm, meaning people are buying all sorts of new insurance. Companies are buying different Insurance Products and things like that. How do you think this all plays out . Well, liability is a little bit misaligned the impact is on them, but theres really no liability on the Company Holding the data its not something thats been the it hasnt resulted in heavy fines or civil judgments against like equifax yet we see a misalignment there. Theres a risk shift specific industries that are most vulnerable hospitals in general havent spent much on Information Security thats not what theyve been focused on block kman, is it going to make things more secure . Anything that is makes it that harder for the adds versary to spoof is going to make us more secure. K on. Leo, thank you. Appreciate it. Happy holidays coming up, the business of College Bowl Games what i dip in ratings might mean for sponsorships were going to talk to a Sports Marketing economictive right after the break. I, i, and respond 60 times faster. It lets you know where your data lives, down to the very server. It keeps your insights from prying eyes, so theyre used by no one else but you. It. Is. The cloud. The ibm cloud. The cloud thats designed for your data. Ai ready. Secure to the core. The ibm cloud is the cloud for business. Yours. The entire Community Came whtogether as a whole. T, it was such an overwhelming response to help others. No one thought that they were going to do this before it happened and everyone just did it. I think thats the way that human nature should be looked at. Ill stand by you. Ill stand by you. Wont let nobody hurt you. Ill stand by you. Joining us now larry man, executive Vice President at Sports Marketing Firm Revolution theres how many 40 i think theres 40, arpt there . Trying to figure out what we should tell people to do whether you should sponsor a bowl or whether you should advertise on the big like theres the cheri theres the bad boy mowers bowl. Does it pay to responsor an entire bowl with maybe two teams that not everybody is setting their calendar to watch or does it pay to advertise on the rose bowl yeah, i mean, its two different philosophies of how you would approach it. I mean, the lower tier bowls in todays world in the commercial environment section, it might be a Good Opportunity to get your brand out. How much does that cost for the bad boy mowers its always suspect to how much they actually dwsh is00,000. Somewhere around there. I think more importantly nowadays people arent watching commercials as much. It allows your brand to be auto television also, then you compare to, okay, if imauto going to be in the big game, you know its a lot of money and its extremely expensive. I think that theres two comparisons. You see some of the Smaller Companies you havent mentioned or heard of doing the lower tier bowls and then the bigger ones its hard to skip commercials, but there is a way to do it if you are just a little bit delayed, but then you cant look at your phone because then you see who wins you can ruin it if you do it that way much more difficult with live sports to get. Correct you also have your logo on the foo he would theres a lot of highlights that go out you know, once you stee your brand on the field, but, yeah, these games, the earlier part around christmas time, theyre more about, you know, schools getting the opportunity to go and then as move closer to the new year, the games get obviously a lot more significant. Is there over saturation. Were 40 now ten years ago how many were there . Probably about half theres a lot more bowl games because its a Great Entertainment programming option for the network. Espn during the day. It gives them something to do. If you add them all up, its higher the new years games which were the big ones. There are four bowl games im really excited for, but then theres 36 that i dont know if i would even watch its really hard. I think a lot of people you know, they find that its very challenging, but there are also those fans that you also have alums of the schools, and you may want to go to you do you represent the Company Comes to you and says is it worth it for me to buy ads theres a Community Piece that plays into it. The bigger companies, you know, it is where College Football is today and this year being back on the traditional new years day, for the big games, it does make a lot of sense. So College Football ratings have gotten better or worse than the nfl 1234 the stories are the College Football ratings are down, but the if you look at total viewership and total people watching College Football, its about the same the reason why theyre down is fox, which added the big ten, has added that opportunity for more viewerships across the network. Cbs and espn may show slight ticks down, but fox would be up. The ratings where the story in the nfl is obviously everybody wants to talk about in college it isnt, yes, the ratings are down, but its more because its been spread across other networ networks i want to watch like i said, theres four games. Im really excited for more than some of the nfl games. Correct you know, thats also the product too. You know, this year you have the four of the two semis are south. Three of the schools are in the southeast. Thats College Football heaven thats hotbed College Football you got some great stories. Two of the top rated College Football games this year feature georgia, auburn, and alabama it should lead to theyre going to change the bowl the way they do you know, like in basketball like the final four. Anyi, larry, thank you. Great time of the year then march madness coming up, this mornings octostk watch stay tuned youre watching squawk box on cnbc your joints. Or your digestion. So why wouldnt you take something for the most important part of you. Your brain. With an ingredient originally found in jellyfish, prevagen is now the number one selling brain Health Supplement in drug stores nationwide. Prevagen. The name to remember. 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. Looks like we have a couple seconds left. Lets do some card twirling twirling cards e trade. The original place to invest online. Good morning. Welcome back to squawk box here on cnbc were live at the Nasdaq Market site in the heart of times square lets take a look at stocks on the move this morning. Capital one has resubmitted its capital plan to the Federal Reserve after the fed identified some weaknesses in its prior submission according to an sec filing, capital one has reduced the amount of authorized Share Repurchases as part of that revised plan garmen has introduced a new Activity Tracker called the vivo fit four one of the differentiating factors that garmen hopes will distinguish the competition, it can go more than a year without having to recharge the battery thats amazing can they do that with the iphone brookfield Property Partners have various options to restructure its offer to buy the part of mall operator ggp it doesnt already own. The prior 4. 8 billion offer was half cash, half stock. Its wary of seming brookfields stock in its current form. One of the proposals is creating an alternate stock in an entity that would combine some of brookfields holdings with ggp the price of bitcoin has skyrocketed, and big hedge funds want in on the action. Thats according to the wall street journal. A reporter, special writer we dont even call him a reporter he is a special writer very special. Not just any writer, right . Gregory zuckerman is leer he is joining us now to discuss whats going on with these Institutional Investors. Were looking to benefit from the Digital Currency we have some guy thats jumping in and some guys jumping out getting a little excited about bitcoin. I mean, until now they drag their feet they thought it was kind of a scam some of the smarter guys, the quantity kind of guys now are saying, you know what, maybe we can mix money on the long or short side theyre doing their homework and starting to get in i know a couple of guys we were talking about this earlier. Some folks are trying to arbitrage whats going on in the marketplace, but i havent found folks that have gone either fully long or short. Can you really go fully short with the new futures contracts its not enough liquidity yet. Thats why people are sort of on the sidelines. Some are playing it, but its not enough liquidity yet theyre waiting for that to develop. If you think about it, how do they like the nasdaq crack or subprime market crack . You finally had shorts being able to express that short position some can argue thats when bitcoin also gets hurt who is the most interesting name you think is getting involved well, you look at theyre learning about it. Theyre not doing it yet if they those kind of names get involved, then i get excited. Steve schoenfelds money very sophisticated kind of firm. Until thousand its like verizon. Ellington is looking at it of course, you youve got old shop fortress, which owns over 100 million. Are they talking about crypto currency as an asset class want yet. No theyre talking about block chain and weve got to learn about block chain. You are starting to see Family Offices started nibbling and doing a little bit of something and looking for ways to participate. They appreciate the importance of the block chain is this the action that happens right before the train takes off or right before the bust happens until now obviously its sort of south korean grandmothers driving this. In terms of increasing the liquidity and actually increasing the number of shorts or express shorts through futures out there. For institutions, its not just skepticism about crypto currencies its not in their they arent allowed to invest in crypto currency, right . If you watch u walk into a pension fund, they cannot do it right now. Although some have sort of this little bucket. 5 where they can do miscellaneous kind of stuff. Some were looking at in that regard others are saying, well, its similar to Something Else. You can convince some board of directors that maybe can fit under some bucket. I agree. For the average institution, there are all kinds of obstacles and barriers, and theyre not quite there at all so its like a chicken and egg for hedge funds to get bigger into bitcoin and to use the futures markets to express their views, we need the liquidity, but we arent going to see a pick up in liquidity until we start seeing many, many more of the Institutional Investors participate. To some extent, right even if you get them allocating this kind of stuff, slowly you could get the liquidity going up, and then you get more people kind of who are looking at it from the sideline to get more interest in. There are all kinds of obstacle brz we get there while we have you here, considering the time saver, you have written extensively what do you think happens in 2018 i think he raises a lot of money, actually. The terms arent especially investorfriendly. Lockup and such the quant investor reigns extreme. He is not kind of this new age kind of investor, so its sort of this love for old school investor that said, through kubis, one of his arms, he has embraced quantitative investing and thats become more important for him. Maybe thats part of the allure. More focused on the shift to the quant investors that i find more fascinating and interesting. What happens to the old school as you call them gut investors . I think they had problems i think with all the information and data being produced on a daily basis, moment by moment, it used being to be, okay, im going to make a decision and analyze it thats been done already by the systems. Its very hard for these average kind of guys or average the institutions and hedge funds that are old cool investors to compete with the quants today, i would argue. Happy holidays. We were just talking to bitcoin. Israels market Regulatory Industries have a ban that this move would seek to block the listing this would impact two companies and describe crypto currencies or the Technology Behind them as an essential business here we have seen Companies Get a big boost after touting Block Chain Technology did you hear this microcap last weeklong island iced tea yes ridiculous. Long island iced tea. I thought that was a drink it is a drink theyre a maker and distributor of iced tea. Now theyre looking into block chain, and now theyre up 154 they call themselves that they just make nonalcoholic iced tea. You missed the point of the story. I heard it. That is stupid no, no, no. Talking about the yes it was bitcoin. Got it. It was crazy to be bitcoin, but its also crazy to be its youre calling yourself icedtea even though its not the alcohol uber is reportedly selling its u. S. Auto business to sta start the company has been trying to wind down the business, which is losing about 9,000 per car uber has been using that unit as a way to attract new drivers bho dont have access to a vehicle coming up, the numbers are in u. S. Retail sales this holiday just did something for the very first time in more than five years. The details in a rundown of the retail winners and losers next shes nationally recognized for her compassion and care. He spent decades fighting to give families a second chance. But to help others, they first had to protect themselves. I have afib. Even for a nurse, its complicated. And it puts me at higher risk of stroke. That would be devastating. I had to learn all i could to help protect myself. Once i got the facts, my doctor and i chose xarelto®. Xarelto®. To help keep me protected. Oncedaily xarelto®, a latestgeneration blood thinner. Significantly lowers the risk of stroke in people with afib not caused by a heart valve problem. 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Tell your doctor before all planned medical or dental procedures. And before starting xarelto®about any conditions, such as kidney, liver, or bleeding problems. Its important to learn all you can. To help protect yourself from a stroke. Talk to your doctor about xarelto®. Theres more to know™. Welcome back to squawk box. Futures right now have been down about 50 most of the 51 now on the dow the s p has turned positive again, just barely less than a quarter of a point higher the nasdaq has improved a little, but still down about 29 points in the premarket session. Making headlines, this years Holiday Season was a strong one for retailers. Figures from master card spending pulse show a 4. 9 gain over last year covering the period from november 1st through christmas eve. Thats the biggest yearoveryear increase since back in 2011 were looking at some of the big retail winners and losers this Holiday Season and what we can expect for the sector in 2018 lets bring in sam, a senior analyst. Sam, good to have you with us. Happy holidays. Happy holidays to you you like a lot of the athletic wear makers, is it because in part theyve had strong Retail Holiday seasons, or is it their performance in all the rest of the time during the quarter . Yes i think whats going on is weve it looks like weve had a good Holiday Season, which will likely lift all boats to different levels, but i dont want to if it is athletic or not, people shouldnt be confused with Healthy Companies and sort of this Better Health of consumer lifting all goods because i believe its all happening to different levels. How that plays into next year is going to be very interesting lets start off with footlocker if the direct to consumer centralities are more successful than what theyve already demonstrated, does footlocker is it still a winner i believe so. Footlocker is the larnlest, you know they dont want to give up share to anybody for instance, you see adidas doing partnerships with footlocker on certain ideas. Same thing with nike and so on i think theyre set up well for 2018 if you are a nike, lets say does it make a difference if you have that partnership with a footlocker versus an amazon, lets say. If amazon is the way people are shopping, might that be more important so, therefore, they are willing to give up that space . You know what, take that footlocker share we dont need it because people arent doing that anymore. Well, i think whats going on is it its really based on how well you know your consumer. Now, definitely amazon is easy to shop in, but a lot of things get very commo dot ized on amazon while footlocker knows that specific kid customer and connects nike is on amazon what percent of the product is on amazon . Not a lot. Its more basics. Theres a shoe called the monarch, for instance, which has been around for i dont know how many years, which is a 60 shoe. I mean, theyre going to sell a lot of those basics on amazon. If you find jordans its really through the third party at elevated prices. Theyre not i dont want to say never, about the its unlikely theyre going to put jordan on amazonfully time soon because it will look too excessive. You read the kevin plank story in the journal . Yes, i glanced at it. Your take on underarmour. I think they made bad Strategic Decisions hasty decisions when they opened up kols and Famous Footwear and dsw. I think it was in response to losing Sports Authority this past year to gander mountain, and so i think that they have to draw very hard line in the sand as to what theyre doing i dont think they can simultaneously sell that moderate channel and then also try to get academy to say, okay, were fine with this you know, with nike, for instance, theres a shoe called the roche which is sold at dicks and footlocker and so on, and theres a shoe called the tanningent, which i believe you have spoken about on this show, which is a shoe sold to the moderate channel they look very similar the tangent customer apie ale s buy the roche. The roche customer doesnt know the tan dem exists its all high endlow end and it takes everything to the low end in terms of the impression the customer has the only way to do that the way to fix that is to sort of cut the cord. If you look at underarmour ten or so years ago when they launched it was a highend brand when they launched mens noncleated footwear, they did not do it well, but they admitted it with womens apparel, and they did whats called shrink it and pink it they took a mens shirt and made it smaller and turned it pink. Instead of working off a bad base, they cut the cord and restarted everything to fix it if you dont do it, i think theres not good things ahead. There are difficult decisions ahead for underarmour right now. Mad money. Lulu has been a winner because its taken some of that underarmour share, and its also in its own turnaround i think that i mean, theres dollar share from everybody, but, again, i think a lot of the lulu customers, if you ask them, you know, how much underarmour do you buy, its really that core lulu customer is totally different. They sell similar product, but the sensibilities of the brand are different. With lulu they had the problems back in 2013, which are behind them as far as brand equity, and they had execution, which appear to be behind them right now. The whole picture is working theyre there for a very narrow consumer i think people get confused with what product is being bought and how its being sold. So is there a smaller brand that you think is on the cusp of breaking out we have these direct to Consumer Brands like all birds and outdoor voices theyre obviously theyre not taking market share the way some of the other guys are just yet is there something that you look on the and go theres something going on there i think theres something going on i think the real question is these are sort of these Little Secrets that do very well. The question is how are you able to scale them . Its something i think nike, given their size is struggling with you know, im about to go to various trade shows in the next month or so, and well learn a lot more about it then i mean, you do see, like, little remerge ens of brands like older brands like diadora and fila and a little bit of k swiss here and there. Those i would more expect a more established brand than out of sight out of mind to emerge interesting sam, thank you. Pleasure. Happy new year. Coming up when we return, only four days left in 2017. Take a look at the futures right now. See whats going on this Tuesday Morning postchristmas dow looks like theres a very tiny lump of coal in the stocking dow looks like it will open up 52 points lower. Nasdaq off about 30 points the s p 500 looking call it marginally up for now. When we come back, were going to check in with some traders in chicago in the windy city. Squawk returns after this. I just finished months of chemo. But i dont want to talk about months. I want to talk about years. Treatments have gotten better, so. Im hoping for good years ahead. Thats thanks to Research Funded by the American Cancer Society. The same folks giving me free rides to treatment, insurance advice,and a place to stay during chemo. I need that stuff like you dont know. And now that you do, please give at cancer. Org prices of the season on the only bed that adjusts on both sides to your ideal comfort, your sleep number setting. Does your bed do that . Right now our queen c4 mattress is only 1199. Plus 24 month financing. Ends monday. Visit sleepnumber. Com for a store near you. Welcome back lets get back to the broader markets, cio of nation shares and cnbc contributor, you know youre very lucky your name was nations, you know what i mean . Then you start a firm sounds big, like nationwide and all it is just your name, right we tried for kernen shares and that was taken. I would sue you up and down if you did that, scott but you know what wed do, the week after christmas, right . We talk about next year. Have you got any pearls, nuggets of wisdom for what we can expect will there initially be any type of seasonal thing that happens any year or is it different this time around . Joe, i think the most interesting news about the First Quarter is the news we just got about apple. They are now rach eting down expectations for the iphone 10 some estimates now shipments for the iphone 10, as few as 35 million. We had 45 million as the estimate up until now. We see that apple is down 2. 5 on that news, a bunch of chip makers getting hurt on the news. That would be horrible for the entire tech eco system i also think that Something Else thats really interesting is copper, copper traded as high as 3. 30 a pound. Thats the highest that weve seen in over four years. Weve been following that for quite a bit. Thats a really interesting story. It shows that somebody is accumulating a big position in copper because they expect the Global Economy will do real well. Thats a cooper roof and scares the copper roof on the stock market or price of copper . What does it mean . I think its the stock market, doesnt it well, i actually think its good for the global market. What is the old expression that every bull market has a cuppcu copper roof on it. Youve given me two bearish things but the apple thing after barones puts it at a trillion dollars and now back below 900 billion, going to go further i wonder if that really i wonder if thats a bad sign that barrons says its going to hit a trillion thats not good news with the apple x as andrew calls it its not its not good news but ill tell you what, the fact that over the last two or three minutes, the s p futures rallied back unchanged on the day. Good news for the broad market and also look, 269 billion. Thats the number that matters to apple, particularly in 2018 with a new tax regime. Thats the amount of cash that they have on their Balance Sheets Balance Sheet and if they can send all of that back to the United States and then start distributing it among their shareholders, then they might get to a trillion dollars. Unless she use it to buy back stock. Oh. Then it reduces it and doesnt get anyway, some day there will be a trillion dollar company. It might be nation shares. Maybe not. Might kernen shares. Out of this world movie night. And tonight on cnbc, dont miss the premiere of the profit in puerto rico, well be right back us. Its what this country is made of. But right now, our bond is fraying. How do we get back to us . The y fills the gaps. And bridges our divides. Donate to your local y today. Because where theres a y, theres an us. Welcome back to squawk box. We are on the chairs this morning. Nasa astronauts aboard the space station had a movie night. A screening of star wars, one of the astro knots tweeted this photo of the fun even star wars is going intergalactic. Very cool. Something redundant about being up there watching a space movie, isnt there they lie down and are attached so they dont float away. Popcorn i dont know. You would think that would be all over the place, wouldnt it and congrats may be in order for jordan spieth, appears to be engaged to his long time girlfriend this is circulating on social media. Yeah, he can afford one of those big diamonds i think he has yet to confirm the news but what else koo that be . Its christmas, big diamond. Thats a finger you wear it on she looks like shes very emotional about it it says congralts. Diamonds are forever. Look at that. Thats nice. Isnt it . It is nice. Seems like a good guy. Yes, he does. Talent as big as the underarmour guy. Which plays into that whole story. We should mention that today marks the first day of kwanza, the week long celebration honors a different principle each day today its unity others include collective economics purpose and kwanza was first observed to celebrate african culture 50 years ago and continues through new years day and culminates with feast and gift giving. Boxing day. Thats today. We havent talked about that. That has to do with returns to, doesnt it as i kid i thought it was boxing. Join andrew tomorrow. I dont know who is with you but right now were both not here. Squawk on the street is next. Youre stuck with me. Good morning, welcome to squawk on the street. Im david faber, were live from the new york stock exchange. Carl and jim have the day and the week off lets give you a look at futures right now. Start tr