Transcripts For CNBC Squawk On The Street 20240713

The dow and nasdaq not far amazing suits and float around behind. S of tiffany surging the cabin. It will be a great market after all. I see you are talking about space suit this morning interest in acquiring the that was designed by under company for 120 a share. Armour the next investing frontier, one of the questions that gets Virgin Galactic set to make the put to me a lot is how do you public debut here at New York Stock Exchange this morning. Sir Richard Branson will join us know it is going to be safe . First on cnbc. When it comes to space i mean so, markets are chasing some history this morning the s p is on track to open at space is hard, it got to go off an all time intraday high. On friday, closed within six without the hitch. Points of that record level no room for error here after being fractions away from setting a new milestone. How do you ensure thats the case and what do you tell jim, a lot of the bears arguing what has gotten here from july has been healthcare and utilities and reits. People actually nofunny, i was a well, i think that us going Customer First over a couple of companies this me and my wife is going to go. Week that reported this weekend, we are confidence this is going to be a safe experience. Tool works, dow, the railroads when it comes down is two things we have safe architecture that can aboard any flight, we tested reported, we got honeywell, united technologies, every single one of these were much it expensively our system has been in tests for better than expected ten years. And they were much better than what have we have been able to do is drive up the reliability expected from either selfhelp or because the world is not as bad as we think. Of the system. So youve got companies that have been formally cyclical that hyper sonic travel has come are much more of a secular component, including jim up travel around earth, some of the fitterling saying were getting analysts starting to look at a bottom on key chemical this industry as the big the leadership shifted to big tech because of intel longterm opportunity and there is been discussion of virgin and to the industrials because it turns out that the galactic as well was that the plan when you industrials are not as, lets started this company one of the reasons we built say, not as per teturbed about your spaceship like airplanes china as you would have thought. It is remarkable was by flying this airplane at there is some mea culpas we need to hear who said cyclical america would be damaged that said, if youre the fed, the dollar is the single worst 3. 5 times an hour. Thing that in every single quarter, it is the dollar, we are casting a spaceship or an dollar, dollar but, boy, i really like the airplane that could travel from industrials that reported last week point to point at tremendous they were very solid really solid s p still tracking down 3. 8 speed. Just how that goes in and well be exploring point to point year on year most sectors showing less than travel with them 1 eps growth. The best sectors are healthcare, utilities and reits. We had 15 years of experience so do you chase you chase growth you chase cyclicals . Today. How much was the hyper sonic there is so much growth that is still weighed down. The cloud kings are way down i saw a note about atlas, this piece of this . The way to think about it is seems like theyre somewhat today what we are buying is a irrelevant, but a Company Really interesting, very lucrative, super high margin that those stocks are way down service now was better than expected, went down, because of Space Business where well be able to take some of the the change by donahoe going to nike and mcdermott going to projects and reiterate in this service now. I think that you can dont idea one travel today, 10 hours plus need to chase growth there is plenty of growth still flight, people are spending for sale plenty of grdrug Companies Still 300 billion a year. For sale, eli lilly which did a hyper sonic plane can take a disappointing, merck down 10hour flight and reduce it to because of bristolmyers 90 minutes a lot to buy there a lot of people feel, by the well go and pioneer and push this idea of space tour ricism way, amazon really disappointed. I go over amazon and if it wasnt for the fact that they getting people to space lost a contract, a very we have a free option on hyper important contract, lots of cash flow involved, i come back and sonics when we deliver the product of say you just literally are the five to ten years frame. Looking at amazon being set up well be able to disrupt a 300 for the next big thing, which is next day plus billion dollars revenue if you asked me about the most business important call last week, it is i think one other important still going to be intel, that thing to point out is if the reverberates throughout the Data Center Data center being spent good well talk about an acquisition environmental foot proiprint of we are doing made that people dont realize if you have a land base rocket that liberty has a lot of data and you are sending people into center chiefly ecommerce, i should say space from the ground, it is ecommerce but thats a deal that is for those of us from philadelphia, going to have an enormous amount of energy. Remarkable, thats bill rouse, we can put somebody into space for less than the environmental the comcast tower, the four cs footprint or sending somebody on at the top and an important the Virgin Galactic to london deal there is not Much Negative today. It is important to point out and back thats going to become more and more important in the years to when you have microsoft up and intel up, you have kind of the come we are bringing the cost of old days the worst one is twitter putting people in ton spato spa im still scratching my head by the way, lpl today says dramatically as far as i am october 28th is historically the concerned. George, when will i be able best day of the year come on. For stocks. To get offered and buy a hyper yes. Today they have the whole screen. Sonic trip today is you are looking in the mid every day screened out and it is the greenest of the green. Fiveyear time frame i feel terrific about that, david. It must be like the old days in the meantime, you can get when att led it, wouldnt you say . May lead it today into space we have to spend a lot of time in the meantime on at t, important story, it is and you got this. And the shoes, too. Not a settlement in the terms the shoes are a really ecstasy that we typically use between an oh my god, i have not zipped my activist and a company because there is nothing that they have agreed to in terms of writing or up so i want to get your thoughts because we have seen a anything along those lines, but number of companies go public they have the full support of this year. There is been a lot of talk elliott, they have come with this threeyear plan, we want to coming out of Silicon Valley and get into that in some detail though i guess now well, there it is. Yeah, the key here for at t, ipo process is traditional and guys, is their expectation they given the fact that is virgin can both increase revenues over in the next three years between galactic directly listed on the 1 and 2 and that they can social capital spat. Increase margins by 200 basis do you see this is a model other points it is interesting, in speaking companies are going to adopt with Randall Stephenson earlier this morning, and also obviously i do. I hope this is a litmus test looking at what elliott had been after, and talking to people who founded by our founders and buil money to build are involved in the conversations, it all went quite the business, should look at well, im told things directly and should now look at things like specks the communication between jesse cohn who runs the activist i have been involved in practice and mr. Stephenson was processes here quite strong, and significant. Virgin where i am chairman after this plan. Both of these transactions got i spoke to stephenson earlier and he said a number of everything that we wanted done, Different Things were going through them too we avoided passes in a way that quickly, guys. Lets take them down for a second, if you can, as we move limited distractions and now we along, well tell you what it are set up to run the business was he was talking about there it is. Were in a unique moment, wants this entire process for us from to see it through. Thats kind of a key thing here. Start to finish, 3. 5 months. And why is it a unique moment . A lot of the investment they say they have been making over the the company got all the money last five years at at t is going and george and his team is to start to come to fruition, focusing on running business they believe which is the most important the call by the way is going on thing. These kinds of transactions and right now. For the quarter, which was okay, the wireless business was pr processes are the future strong, directv continued to monopoly run by morgan and have significant subs, there is goldman, those days are stankey, talking about randall numbered stephenson going to stay on and just because we are on through 2020, another part of the topic of this ipo process this announcement this morning right now. Theyre also going to split the toi i want to get your thoughts, a lot has happened since then. Chairman and ceo jobs once Randall Stephenson steps down. And we talked about john do you think it is on a stankey, potential heir apparent, big job, start right sustainable path right now there, got to be somebody who is i think the big question is going to be considered for that they have 48 billion of lease job if in fact he delivers thats going to be a key in fact, tomorrow is a big day obligations. For at t as warner media rolls the way they engineer this transaction was to avoid the out its plans for hbo max, the fallout of that and falling onto big streaming service. This Balance Sheet but back to the plan this this is a precarious company morning, the reason the stock is up, guys, is because theyre if there is any down take in going to have they say 35 demand, meaningful these guys are going to have a margins, up from 33 , generate an additional 6 billion in difficult time figuring out how to make the economics of what ebitda, by three years from now. They created work. That being said, the market fit and with that additional ebitda, is unquestionable. Talking about both buying back significant amounts of stock, in i think of any Company Large or fact, most of the stock that small, they do not want to sign they issued for the warner deal and continuing to reduce debt, a tenyear lease anymore we all love a beautiful office while modestly increasing the and environment. I think the way they executed dividend you put all of that together, of course, you might imagine that elliott is quite pleased because these are many of the same turns out to be unsusceptible. Things they had been asking for in terms of both capital pretty amazing. Allocation and cost cutting and, yes, cost is going to be an richard, i want to get your important part of this in fact, the company says, listen, were aligned with thought s on facebook because elliott on Capital Allocation cost cutting they challenged us how they communicate the goals. Thats the key here as well, because we got it all in writing. And, in fact, they also hired that was in the news, Mark Zuckerberg testifying before the bill morrow, a gentleman to hill is it warranted or what do you oversee the execution specific to cost cutting. Think the company is dealing heavyweight yeah ill tell you what is with Going Forward interesting, david, you and i it is the intersection of have seen over and over again that elliott might come in with a plan business logic and morality. And there will be some ceo who at some point your morals and resists it is this a man who wants his legacy to be known as a much ethics conflict. Higher stock price because this plan will get if you follow your morals and higher stock price. Ethics, you may make changes to i think thats such an important part of this and they the way that it your business that suppress the would be portrayed at this point value of your business is it is all about legacy for lets take a say no evolil stephenson, next year or two, however long he remains in the job is going to be the time that he feels he can deliver on many approach and well maximize it of the things that he set in i agree with richard. Motion now, we can debate the merits of do the right thing in the end, they wont the directv transaction, particularly given the massive survive much longer. Sub losses, another 1. 4 million when you put in both directv and at t now, the former directv i completely agree with you now. But he did tell me as well, bringing it all back to space there it is, those sub losses have peaked with the current right now. We do seem to be ushering in quarter. Peaked. He did say that is the case this new era of space, how are and points out that theyre still generating 4 billion in you thinking about it longer cash flow from that asset, which term vision to Virgin Galactic, you is obviously important to their strategy, but, yes, jim, i think do have virgin orbit thats a very important point. And i think thats why elliott is that the right way to think about it feels like theyre in a i am afraid you did have to potentially good position here he wants to deliver and or have be in that bracket if you are his legacy be a higher stock going to go in the space price than is currently business i think i think it is good certainly the case delivering on so many other things hes put in motion. That people got money that are you know, theyre talking about increasing earnings per share, investing in exciting new things 40 cents of that will come from and employing thousands of the share buybacks 25 cents a share will be from Cost Reduction engineers we are pushing the another 20 cents a share from barriers forward the warner synergies you take 10 cents a share out for hbo max, but gets you to the so, we felt next year well have number theyre talking about in an exciting year term s of earnings per share i will be going to space and other people will be going to fairly quickly space. Virgin orbit was not apart of will they get there . Unclear. Can they get there the Virgin Galactic company. Certainly a potential thing. And elliott will be a longterm investor here. That should have put a big rope no settlement, they can do what they want along the way, they seem to have agreed on hit from a 7. 7 intour Additional Board Members as well. It does seem they can buy all they want if they like this putting satellite around the plan and, david, it sounds like no earth and much more affordable and better way sacred cow situation gentlemen, thank you for bringing someone from the outside, i mean, it makes it so joining me today if you need a journalist to take one of these trips to the edge much easier town ta untangle whs of space, i would like to throw wrong. No sacred cow is a key thing theyre going to try and let my name in the hat people know as far as the congratulations on virgin portfolio review as well theyre going to be doing, overall, galactic going public today. Immediately starting a comprehensive portfolio review, thank you very much guys, i will send it back to evaluating opportunities for all you. Assets well done if you want to know how to go but thats over time the key thing are these on top, spotify turns up the financial metrics they chose to communicate publicly for the first time, jim, and that are the reason, because i think if user growth. You had this quarter, in shares are soaring today isolation, you would not see the the Company Also Announced that stock up almost 4 dont want to be too granular its cfo Barry Mccarthy will be i know elliott wanted 300 basis points ebitda margin expansion, stepping down at the beginning at t talking about 200 basis of next year points is this a conflict joining us now Barry Mccarthy. No. No not a conflict theyre happy with the 200 congratulations. When you do 130 million theyre happy that theyre going in the right direction and they obviously believe that perhaps theyre underpromising and can subscribers up to 31 year over year overdeliver on the margin i think people are finally expansion. Realizing that you guys are just listen, it will come with costs on fire. And it will come with potential. It is performing very well. Jobs got to know that, right . No question about it but it is worth going over, and spending the time, because it remains a very big Retail Holding of which people have why said, you know what, im in the wrong one, i should be in do you remember netflix in verizon. I think that this plan is a the era when streaming first solid one. I also think by the way that, geez, 5. 5 dividend that is launched back in the day clearly you got to admit, it you were there. Is covered cash flow is good. Linear dies and on demand thats been the key question and the performance of warner is wins same thing is happening. Going to be a key question yes. Without a doubt so was the Music Service thats why tomorrow is an important day for them narrowly originally . Now it is going to go to 3 00 p. M. Eastern is when they begin the presentation sorry. 6 00 p. M. Eastern, 3 00 p. M. Service . More engagement for you and more pacific is had they begin the preparation for hbo max. Going to be very important in engagement drive and virtous terms of judging the ability of that company to sort of navigate the quickly changing distribution platforms that we have in this business. Cycle. And directv has not done as well looks like Southeast Asia which people may not think as they might have hoped super analysis, thank you super. Performing plat this corner yeah. A lot more to get to including tiffany. Along with india as well tiffany after the break you mentioned Virgin Galactic, we are hitting on a couple of cylinders at the same time first publicly traded space barry, when he you guys did Tourism Company and well have an interview with sir richard the direct list and soon after you had an analyst day talking branson and ceo George Whiteside to your investor based later on this morning. Coming off that chase for the right before it all time high, looks like well and you said, you could get it at the open as we need expect mid30s i think it was 35 Gross Margins 3027. 98. More squawk on the street in a longterm for this business. Moment orlando isnt just the theme park capital of the world, you are nowhere near that. Yes are you ever going to get there . I think so. We said overtime you may remember the stock rolled over of october of last it also has the highest growth in manufacturing jobs in the us. Year i think the reason it rolled over because we said to its a competition for the talent. Employees need more than just a paycheck. Eninveste investors, hey, dont be expect you definitely want to take advantage of all the benefits you can get. Operating leverage that we have 2 3 of employees said that the workplace is an important source been demonstrating because we are going to invest in this for personal savings and protection solutions. Thing called podcasting. The workplace should be a source of financial security. Initially, it will be a tax on the p l. Keeping your people happy is what keeps your people. Overtime it will increase and thats Financial Wellness. Well grow faster. Put your employees on a path to Financial Wellness with prudential. Now, at netflix, we had the same phenomenal happening when we began to invest in streaming we double the investment every year eventually the content became good enough. Initially it is a tax on the cost of revenue. It tends to press Gross Margins. We also said in our investor day that one of the reasons we would be able to expand is the development of the twosided marketplace which we said more about in our investors letter today and well talk concretely in terms of 2020 and our margins. Thats a future software driven market you said two sided marketplace, can you please explain . Netflix is in the business of voting demand creation serving content to you that our rhythm tells us you will like. If you do it very well you find great music point when you come to the service or great podcast. One of the features of twosided mark place that we Just Announced rolling out enables us for artists releasing new albums to promote those new albums on fan base on spotify. Today labels and their managers dont have those tools available to them. They use Mass Marketing which was a pretty in efficient spend. We know exactly who the fan base are so we can promote that if we are going to use netflix as an an lalog, does th mean we have a way of interests still to come . Maybe we spoke about it at length. And, there is big spend on podcast content. Tiffany shares surging in the premarket, Company Confirms it has received that unsolicited takeover bid from lvmh, the same thing happens streaming at luxury goods giant run by netflix. The streaming business was fixed bernard arnau. The board is carefully reviewing cost and their opportunity to fix the cost in podcast and we that proposal. It is a 73 stock in december, have exclusives. And david has more on what their 50 million things in the response might be. Well see the next couple of weeks, next platform everybody got the same stuff discovery drives a different week or so, you can expect theyre going to be a number of sessions of this board, theyre in podcast you can have going to review the plan, review exclusive content. The bid itself it is not just discovery, right . They only hired advisers late it is also blooming last week on the banking side. The rewards that people are and so you had a letter sent on making money in washington the 15th of october, by the way, you know i want to do it i can tell you that lvmh has okay, well take that. We are offline been considering a potential a lot of people think apple got purchase of tiffany or for the last two years a big music business thinking about it for that long well. A period of time, but it was they have scale in the u. S october 15th, they sent the letter, the 120 price tag. Their last publicly announced these guys did not hire advisers member was i think i cant until middle of last week or so. Remember if it was 50 million or theyre finally getting together another week perhaps even more 60 million. Before tiffany has some sort of theyre growing slightly less to a million a month, about half response or choose perhaps to the rate we are growing participate in discussions to see what can be done here. 120 is not the price at whic globally their geography in the world theyre going to accept, and you latin america is not a factor by can see the stock is trading above that in the expectation that investors have that it will any example. It is strong in the u. K. Be a higher price. A couple of quick nuggets here based on conversations ive had with people close to the so the primary footprint is u. S. Situation. Which is that tiffanys all time base how much these partnerships high is 139 im told highly unlikely that work the at t partnership, we have they would go to that number been talking about that. Thats got to be one you never know, of course, but theyre big company. That must be a turning process theyre using the word well, it has not bee discipline a lot and people say, well, yeah, but look what youre been maybe theyre a little willing to pay for bulgari bit distracted they got a lot going on. They absolutely have the would they go hostile . No potential. Six months free unlikely that they would go we are all big users. Hostile and by that i mean a proxy fight. I love your product. I think broadcom, qualcomm, something along those lines, no. If i can get it for free, i unsolicited bid here, a company would get it quickly they get behind it we that struggled to a certain extent over the last few years, 32 premium to the unaffected didnt have to say it, the important thing for us to have stock price, lets call that the numbers and several dial to thursday before rumors of this turn like we did with netflix. Started to hit the market. How is back to growth and theyre going to have to figure out to, jim margins, not the longterm, the what do you think when it comes to evaluation . This is a company, the ceo supported business was not as strong as the premium that margins are better this quarter came in and bolio inherited a but if that support starts to really an undermanaged move more positively, you will see Gross Margins going down company. He had a terrific plan he has some bad luck the Gross Margins on the plan was to expand into hong business, no question about kong they lost six Business Days in that i think what you will find is hong kong because of whats we are able and there is going on and really make a major presence operating leverage to be had and in beijing we begin with podcast by example in shanghai, in ecommerce in or promoting content of the two china, in part because they recognize that this dollar sided marketplace to pump more problem is going to make it so revenues to the existing cost no matter what they do in the structure with no increment united states, a la macys, they cant get it together. There is real bad luck here. Content cost it will be margins. This is not the tim to be levered to china you mention the algorithm not the time to be levered to hong kong. It is the time to pick them off. How do you describe how it is the time, right sophisticated they are these time to try to particularly days is it more classifying a song or because of the hong kong weakness, which is so giving it half a dozen unexpected, but maybe they got a plan in place that is going description and matching that, to it is unclear, i have not how smart is it . Talked to any large holders it started out as collaborative filtering. Here the Qatar Sovereign Fund is one all previews had similar of the largest holders, unclear taste. Where they will end up in all of they like the song that you have this. Right but lvmh is going to have to not heard a lot. Thats collaboratively wait a little while here and see filtering. What it is that tiffany chooses now, there is deep learning and to do as their board sort of now we are able to do things starts to review things. A couple of board meetings analytically as a result that we between now and then. We dont talk enough about how fabulous lvmh is. I had no idea are not able to do a couple of years ago. 15 billion market value so it is getting dramatically hes either the second or third better and really fast when i join the service it was wealthiest man in the world. Yes not really good. Mentioned their quarter and guidance last week was off the it is a different user today charts extraordinary most of us if you listen to and this is louis vuitton. Podcast found it more come it is so much more and i think that people speaking of marc benioff about it, really the best hes got on so many retailers in his stable, now as we gather more data, we are exponentially better at but he said why arent you focusing more on lvmh. I said, i focus on sephora, recommending contents, too surprisingly, it works pretty unfortunately jcpenney, high end clothes. This will be a capstone move well a year from now, it will be much tiffanys moved up one of the things this has done better is go heavily toward platinum a podcast is going to be really that important for you . Jim and i did interview a while and gold and down on silver. So it really fits the lvmh mode. I think they get their man here. Back when you maede the first you do . I do. You think theyre going to yes, i do they have unlimited firepower. Significant acquisition. They do, but, you know, to i think the question is the extent they keep saying to me, discipline and wont go to streaming. Is it important compares to the all time high, only ten bucks above where that stock is trading now. There is some discussion this netfl netflix . It is a different value morning how it values at 25 times and el is trading 28, proposition. People listen to a lot of music and a lot of radio could you go that far . El reports this week and everything uconn assuyou consumo there is a lot of chatter that el is going to miss in part except for realtime programming because new survey put out by like sports, you are going to piper that consume on demand strengths in downgrade today. Not putting makeup on your home or car and when you thats very different from the can do it. Ceo much higher growth rate. There is a lot of that el is el is pristine, barry i think you are relatively really is. What do they like . Young. You are going back to northern lvmh everybody worships lvmh, except california staying on the border, do you have one more act . For us, because we have not spent enough time on it. Today is the day my work is my hobby maybe join us some time to i am right. I am embarrassed to confess talk about how rich he is. Tried to go to tiffany on friday with my wife, they were right in there, waving at them, i hope so. Time will tell and it was closed, one minute after, they lost a very big but, you cant leave a business sale how is it that a french guy when it is not doing well. Is aloud to be one of the i announced my retirement from richest men in the world i think that is because there netflix in 2004 and the business is two frances there is the rich france and got crushed by blockbuster then there is the i went unretired and we could get a new record recommitment to two years and high this morning. Looks likely there is branson on the floor, that turned into six years and along with chamath well talk to them later on this after i left, the stock went up hour as Virgin Galactic becomes the first human space travel tenfold. You cant leave when youre company to go public everyone is asking me about friends are in a fight and the this Company Business is doing well everyone daniel hired me to do two it is made beyond meat look like, you know, beyond beef things go public, build a team, perform jerky. By the way, this iris at a high level and finance outside, that giant flag is function is a Public Company bransons actual eye, according it our reporter, michael sheetz. Hire and train most successor. His eye eye thats coming up. Dont go anywhere. We have been working closely ever since and increasing responsibilities since if you like the guidance we have given since we have been public, getting the treasure responsibility if you like the direct listing, the admire of his work if not now, when another five years fair enough you should be mad that this is your daily commute. Barry mccarthy, a legend. You should be mad at people who forget theyre in public. And you should be mad at simple things that are unnecessarily complicated. Great to come on the show. We appreciate it. But youre not mad, because youre trading with e trade, jim, thank you for sticking which isnt complicated. Around longer. Their app makes trading quick and simple so you can strike when the time is right. M whats on mad tonight . When you are in that dont get mad, get e trade and start trading today. Business, thats the greatest in the world. It is Cloud Business it is about making money wow you are 66, i wish you were retired. You are giving him angst now. It is happening to all of us. Come to california with me. All right, i will lets send it over to sue herrera get our cnbc news update good morning everyone here is whats happening at this hour the European Union has agreed to grant britain a new brexit deadline until january 31st of next year. Boris johnson appearing outside ten downings street as the news emerg emerged. He posed a photo as he appears in front of the public firefighters in Northern California continues to struggle toll get the upper hand on the kincade fire it has already burned some 84 square miles and the containment dropped from 10 to 5 governor gavin newsom declared a statewide emergency on sunday. Katie hill has resigned with an inappropriate relationship shaping up to be a big week, with the capitol hill staffer. The busiest week of q3 earnings. Thats against the rule. The fed meeting, boeings mullenberg on the hill and tiger woods, his 82nd pga likely record high at the open when the opening bell rings in about six minutes. Were carvana, the company who invented title tieing him with hall of famer sam sneed. Congratulations to him you are up to date thats the news at this hour thank you very much stocks surging today to a new record high on the s p more on squawk on the street. Ive been a caregiver for 20 years. No two patients are the same. 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A free decision guide will provide a breakdown so ditch the old way of selling your car, and say hello to the new way of aarp Medicare Supplement plans, at carvana. And help you determine the plan that works best for your needs and budget. Wyou can see relationships. Gy, call today to request yours. Connections. Lets recap. Patterns. There are 3 key things you should keep in mind. You can see what others cant. One if youre turning 65, you may be eligible for medicare but it only covers about 80 of your Medicare Part b costs. A Medicare Supplement plan may help pay for some of the rest. Two this type of plan allows you to keep your doctor as long as he or she accepts medicare patients. And three these are the only Medicare Supplement plans endorsed by aarp. Learn more about why you should choose an aarp youre watching cnbcs Medicare Supplement plan. Call today for a free guide. Squawk on the street live from the Financial Capital of the world. Opening bell in three minutes. Busy monday morning as we wait for Virgin Galactic to open at the nyse jim mentioned microsoft a moment ago. This 10 billion pentagon Cloud Computing contract that they won over amazon and lots of reporting over the weekend about how this decision came about. A lot of people feel that these are six or a half dozen. I know andy jassy would disagree, he runs the amazon cloud. The acceleration in the cloud azure that microsoft runs is rather extraordinary time for our etfs i think that we there will be people who say what did the president put his finger on the scale. Well, this is a tough one spotlight. Microsoft is helping boost the because Satya Nadella has done a sector on news great job. You have to wonder why the watching google and alphabet is pentagon just didnt pick him set to report tonight after the because it might be maybe, but, you know, amazon was seen as being in the hold bell apple and facebook are due out position. And the president has for results later in the week. There was competition from others, oracle as well thanks carl, as we head to break well take a look at at t but and we know what the and of course you can see the president has said i know, but stock is up shortly. Thats what happens when you the Company Reported quarterly mess with expectations like earnings but more importantly, that i got to hear secretary mattis, no longer secretary, obviously, defense department, a threeyear outlook calls for talk about independence. Did not mention trump by name, but i felt that there was a increasing margins by 200 bases points degree of independence with the pentagon obviously if you want to make your life easy, you pick revenue at significant return capitol and Share Buy Back microsoft. We have seen the president go to tune on anyone who disagrees a lot of Different Things with him. Nomura is out this morning, contributing to that upward vemo dont make it a catalyst for the in to shares well be back right after this stock. It is a multiyear deal, annual revenues small versus the total. It is rarely worked out this actually moves shares one way or the other. I dont know if i agree with that youre talking about 200 to 300 million Free Cash Flow benefit i too had come up with that analysis initially and was saying on twitter this weekend, dont pay up for it i dont like paying up for it for a company that reported a great number i would rather buy amazon down eight, the number wasnt that bad. This was a big and lucrative contract people have to understand, you look at the Gross Margins for data center, it is far better than the rest of your business because, yeah, you build the you should be mad at airports. Data center, they will come, it excuse me, where is gate 87 . Does work. So i think it should be up, you should be mad at nonseasoned travelers. Should be it be up were up and they took my toothpaste away. 3. 5, probably end up being able and you should be mad at people who take unnecessary risks. It to buy it at 2, up 2. How dare you, hes my emotional support snake. It would surprise you if amazon contested this as someone but youre not mad, because you have e trade, said they might. People think amazon will whose tech helps you understand the risk and reward potential contest it im looking at a guy like jassy on an options trade its a paste. Its not liquid or a gel. So fabulous, i think they say and even explore whatif scenarios. Lets get our job done and lets wheres gate 87 . Move on. They have won their fair share dont get mad. Get e trade and start trading today. Of business. I think they go forward and just plow forward with the regular business did have a deceleration of high 30s. The law of large numbers will play a big role in that. If you want to know what i if i were them, i wouldnt contest it only just because of the new political environment. Where theyre regarded as being too it is a big step for azure, no doubt about that. Lets get the s p and the opening bell here. At the big board, nbc holdings, home builder operator celebrating its anniversary. At the nasdaq, cabaletta bio for hey. Hey. You must be stevens phone. Autoimmune diseases. There it is at the open. All time high for the s p 500, bouncing off that level we last now you can take control of your home wifi saw july 26th. Jim . It is incredible because ive and get a notification the instant got to tell you, if you told me someone new joins your network. Only with xfinity xfi. Three weeks ago, three weeks ago people say, listen, we get into download the xfi app today. Earnings season, and it was right before the banks, were going to be sorely disappointed. What is going to happen is the banks are going to lead us down because of yield curve, industrials are going to lead us markets continue to rally down because of china, were this morning going to have healthcare go down s p hitting that all time high because of elizabeth warren. Were going to have technology go down because it has been at the open. Our next guest sees global moved too high every one of those ccs has been either rebutted or frankly to growth slowing the point where it is standing on its head. Welcome back my pleasure when you go over some of these have we moved pass enough caterpillar a classic example. I went over caterpillar line by line, kept saying, all right, this is a quarter where everything that they wanted was not good and yet they are going to trade . We definitely been in a theyre talking about being a dividend aristocrat, buying back global recession tch a lot of stock, being lean, it the u. S. Economy has been okay is incredible look at this overall. The central bank is easy stock, it is an incredibly there is no inflation really important stock because it is in around the world and that allows every single got every central bank around the world to industrial pie, talking about keep easing. You have Balance Sheet expansion raw costs coming down. Talking about maybe europe not along with lower Interest Rates being that bad and you can tell if it is and then you start getting retailers that we have had, working by the extent of which walgreen first, walgreen, were used to having them get clocked stock price go up. By amazon. It is a big day because the look at the numbers, theyre market is making upside break fine so i am seeing so much good and im also i keep reminding outs we should see it bottoming in myself there are big strategists who are saying sorry, it is not the slow down and growth going to happen this year. What if it is so good the fed sometimes the next few months says were done . Really . I was pondering that this you think q4 may be the weekend, i said if it is that good, then i dont care. Bottom or q3. I do know that the autos need whats the bottom . It if you asked me what the weakest part of the economy is, it is the bottom is about right in ford. You just got done saying growth the bottom had about 2 for the there are about the economy can survive a manufacturing recession. We need the dollar lower, the u. S. You always see improvement economy can the dollar lower of housing but the thing is not and the autos are critical for the next leg of the economy being thought of right now with because theyre just completely you and me is half prices are shut out doing better but, again, i will say that we dont need it as much as i to the extent, stock prices are thought. By the way, deere, people keep doing better last week they reported existing seeing deere is a conundrum house prices were up month to were doing so badly versus the chinese, what happened is the month in september double whammy positive for deere. Both stock prices and house the chinese went and bought the prices doing better. Soybeans of brazil, sales for that listed Consumer Network deere are extraordinary. Which helps the economy with and there are farmers that got a big check, second big check, about twopoints lag i wonder how much it hinges sales here are okay. You start getting in you on trade dynamics and not just rebut the presumption of every bear here. It makes it difficult to just u. S. Tchina in saying that but stay negative. Usnca getting into congress and difficult. We have had 41 Central Banks cut rates this year. Right. Everything with brexit for a combined 2000 basis it definitely plays a role points with it. We have been at it for 11 years right . And the market is essentially and i keep looking at the where it was, a little higher than 18 months ago. Economic fmonda fundal i know there are big cap stocks that we look at that havent done anything. Facebook hasnt done anything. We have google, alphabet tonight, it does seem that the market apple and microsoft have been extraordinary now, you come forward and you had problems with trade and all right . But then again we have got a stock like boeing, trying to brexit find its footing those are constant backdrop and one of the reasons Central Banks i interviewed doug parker on friday have been easier but at the american air you know what was astonishing . Moment it looks like the path of 400 million lost. Who is going to pay that resistance is for asset price to he says boeing shareholders go up. That pushes ahead economic should pay that. Growth and sort of move through not his shareholders those. Did gary kelly not imply the same thing trump has androg agenda that he and yet nobody is worried about the dividend, which is pretty watching for the election and he interesting. Wow needs some of these things down look at that almost 3040. Well keep an eye on virgin glak if he wants to be elected so you are getting some progress in trades in that regard. T what else if powell says galactic set to trade at the big board. Lets get to bob pisani for more well give you a 10yr cut and on that. Here we are waiting for it to open i understand it is going to open fairly soon, maybe 9 45. Thats all remember, no new shares are i would like the 10yr will being sold in the public, this go back to 2 is not technically an ipo, just a new listing down here. Richard branson is right there, now it is 185 and our best guess between the standing by the is powell will not give a bell there, 51 . Chamath palihapitiya standing over there on the right, 49 dubbish or a hawkish one. Here it is already been trading in the preopen. It closed friday at 11. 79 stop easing if he needs to and this is the old spat as we all know this will be the it is trading around 12. 40 in third rate cut and thats sort of the magic sauce in the 90s the preopen. So thats up nice. Remember went public two years to get growth to stop slowing, ago at 10 the spat was 10 jumped up in july when it was announced that chamath was for example in 95, they cut buying into Virgin Galactic and rates two times and the economy closed 11. 79. Stabilized they feel like theyre in sort a lot of interest in space these days and there are etfs out of familiar territory if it works out and the stock market there. This is the first publicly rally is a suggestion that it is traded clearly Space Company that is out there. Working out. But there is a number of them of course with the economy is out there already. You can look at the rokt, thats doing okay, earnings are coming in okay. The ken show final frontiers, theyre not strong but theyre investing companies that are very active in space programs. Enough to keep things moving it has done pretty well, up 30 . Ahead. All right it sounds like people have includes teledyne, raytheon, said policy easing its northrop, l3 harris. Effectiveness and you look at thats done well some smaller etfs out there, if youre interested in space what rates are doing and george business, procure space etf, may decent this week ufo, get it . Thats the symbol. It does not sound that argument they invest mostly in satellites that only went public a few months ago is wrong my base case, the extent a little young there but the satellite business is absolutely critical to whats which it pushes up asset prices, going on in the overall business of space stock prices and half prices thats how a lot of the business is being transacted. So, again, i understand that theyre both doing better. This should open around 12 i think the fed is, they have to be pretty happy of what they are 9 45 and i think were also going to get some fireworks, doing. This being Richard Branson and i dont think you have inflation you can see the beautiful little yet. The fed can be relaxed and if rendition of the of plane they are too slow and tightstop going up, six passengers and two pilots, standing other there one of the great traditions, a they can go in and make up for bell for the new companies here on the floor and technically as i said this it if they should not cut, they can is a new listing, theyre go in and reverse that treating it as if it was an ipo right now. At the moment, i think theyre chamath talking with richard, in a pretty good position, given trying to figure out where the open is going to be. You see the indications already there, 12. 25 to 12. 75. All the circumstances. Ed, 2019 is getting up to be because it is not technically new shares going out to the another year of the growth public, they dont have to go debate in the economic market. Out and find the potential i wonder where you fall in that buyers for the shares that are debate and how do you this i it already out there in the hands sets us up for 2020. Of the already sold it to i dont fall on that debate so it is going to be fairly smooth it is not in my will house just the matter right now of getting enough of a a bid and really lets move onto another topic. Ask to get the size proper, so were going to get probably my main pefeeling is our policys within the next four to five minutes i wouldsay, were goin working in the u. S. Economy and to probably have a Company Going it is okay and not much in public here at the New York Stock Exchange and, again, well get some fireworks on top of that on the floor on the top flal here that were expecting to inflation. See. Well keep a close eye on that the mark et is still climbing over the weekend of a survey they do there were 27 of the ill get to you as soon as we people were bullish and that was get some indication. Carl, back to you. Talk to you in a bit, bob the lowest over in 20 years. Pisani jim, we did get a well, finally one last topic ratification of the gm deal. Four years, and ends a 40day i guess, hopping from all the strike that will be the template Going Forward for ford and fiat, which things we have discussed, macro you mentioned other auto sectors need to know keep thinking about that to politics, theyre afraid of ford, late ford bond downgrade, warren or general election the Balance Sheet looks really suboptimal at this point gm good to get that out of the way. Autos, just probably the weakest part of the economy. Angsang and i see no sign that there is angst in 2020. Any sort of pickup there is just, you know, the the market is going to trade off whether or not if they think all the car loads i get from the different railroads i study, it warren will win. Is just an incredibly weak only something well be talking about all year if not now. Cargo. So we also are waiting for the we gotten the start mexico canada agreement. Need to see that lets be honest. Before trump, these companies it is always great to check in were all trying to get all their with you thank you so much as always. My pleasure auto business to be made mexico. A quick programming notice as 5 an hour, incredibly cheap we go to break dont miss our coverage of peso, no healthcare, no pollution control, no union. And that stopped boeings ceo, dennis muilenburg. So the upside stopped. And mary barra may do whatever she wants and good luck to her hell answer questions of the the way the companies were making their money was to move, 737 max. And thats over under president dow is down 67 points right now. Trump. It is just over. You cant do it. Likely over no matter who is president next doesnt matter. More on squawk on the street when we return yes. Thats a really point. There is no democrat who favors the migration of capital that is over both parties have come to believe and im going to use this term and i know it is going to shock people, globalization is over. The notion of globalization is over and those who continue to seek it are really living in yesterdays world. So then you say, well, wait a second, apple is about to report, arent they the king of globalization . I would say what apple has been able to localize everywhere. Jeffries, they got a bunch of price target increases on apple today. Jeffrey goes to 285. Yeah, thats new high. A lot of the price targets are still well below where the stock is which gives them ample opportunity to raise their price target i dont know i dont like it when apple has run so much. You just dont may not have the horses to take it hard when you say globalization, globalization is over, thats a fairly wide ranging statement. And could imply as well, if youre right, that an era of growth is over to a certain extent and that, for example, lower costs in certain areas as a result of globalization are also over well, you have supply chain, doing better, internally thats why that liberty deal again is important deal. But, look, david, what can i say, the dollar has made us not competitive in a lot of places youre always going to get cocacola. They havent globalized for 60 years. The notion of outsized globalization, where what weo is we accept anything that chinese sends usport any jobs t necessary, that era is over. Now, you can say that maybe jim what im saying is that is nationalism. But i just look at what is going on with china, the companies that are there, with the one quarter of tech is exception of pay pal, have not been able to get much of a hitting an all time highs. Break. And youre starting to think that maybe i keep hearing that investors say the winning streak maybe the president , let me tell is just getting started. You what i hear, you know, i may more squawk on the street is coming up. Not like him, but maybe the president is right when it comes to what is happening in china. Wait, what part of it well, that the chinese have really taken so much of our intellectual property. That there is many people agree with that. Right i think there is some people who are thinking, you know what, maybe it is too hard on the other side, speaking to someone who is an a billion dollar importer to us, and just saying, look, you know, we cant move from china. As your life grows, so do your needs. We dont have the ability to move from china. China makes something perfectly. And with bank of america and merrill, move it to india, and then they the benefits you get can grow, too. Have good creativity, but dont make it perfectly. Vietnam does not have the deep as a preferred rewards member, enough cargo. You can enjoy Priority Service and exclusive discounts. I would argue, though, that so your growing life can be more rewarding, too. The if the goal was to create more jobs here in the united states, it is not clear that that is actually going to be the what would you like the power to do . Net result of our trade war with china. I have it tell you, if you take you take a look at wendys, they have to hire 20,000 people, good luck 20,000 people for breakfast. Wendys. There arent 20,000 people to welcome back hire. Goldmans done some work on our robert frank is joining us whether labor scarcity is truly now with more. Investors are be dragging down nonfarm. They say maybe by 15 k theyll have to raise the offer it is really not an issue yet. For tiffany or there will be a i think that it depends state bidding war. Either way, it is about lvmh ceo by state mcdonalds has been hideous. Yes on a Conference Call, solidifying his title as the directly to now we know why king of luxury because popeyes comps were stock up 50 in the past year. That added 28 billion to his 10. 2. They bring back the chicken personal wealth. Sandwich by the way, made him the third i had to wait in line. It is darn good. Richest man in the world, just quick serve, they missed the quarter, and the stock is down under 100 billion 2. All right. Theres a reason they call him not so bad. Mcdonalds Conference Call the wolf in cashmere clothing. Was as somber Conference Call when he wants something, he because Steve Easterbrook was usually gets it. His acquisitions growing like im real excited and first they reached a 215 billion question, wendys is open ing breakfast, and theyre going to conglomerate, over 60 brands come well, i hey, the more the merrier. He gave you kind of you know what he gave you he gave you a read answer from jewelry and watches have become netflix. This is all about hortons a big growth area after they here hortons comps. Bought bvlgari thats almost half the profits. I think goldmans wrong on this labor thing tiffany would give arnaut a look, Union Pacific last year was telling me they had to hire people formerly incarcerated brand, but this is a lot about thats no longer the case. China. Your point is even though our chinese customers account of a third of luxury spending in the trade war with china is not going to result in more jobs world. It is expected to be half in coming back here, doesnt matter five years because our employment is so tiffany is a popular brand in tight. We need look, if you have china, but the company was late immigration, i think it will be to the market, and also late to different. We shut down immigration pretty hard. We have the shipped. Very hard. There are questions about our birth rate is not birth rate has not picked up. And chinese consumers buying it appears as part of the more at home overall plan at at t to increase he was the first to open a store margins by 200 basis points over in 1992, seeing a 60 jump in the next three years you would expect there would be reductions in oh, david, i think thats really the undercurrent. Sales, driven in large part by at t is up sharply. China. Also helping, activity kntiffan up almost 4. 5 they reached, well, its peace with elliott, no doubt about that not a settlement in the way we typically refer to these kinds guys, back to you. Of things. Robert, a couple of things on nothing has been agreed upon in the m and a back and forth to writing, no stand still or anything like that but they have the full support add. I want to sorlt of ask you of that shareholder and you can see a lot of other shareholders something. They sent a letter october 15. Getting on board here as well. It will be a little while, they talk about earnings per probably a week before we hear share between 450 and 480 by from tiffany, the board is going to review it 2022 they are as i said going to hired advisers middle of last week i am told theyre not going to hit the alltime high, 139. 50. Improve marriage binzve margins points and Revenue Growth of 1 to 2 all that said, he is the second many people would say thats going to be the tougher thing to or third wealthiest man in the achieve than will be the margin improvement themselves world . Number three now, just under they actually appoint a gentleman to oversee, really taking costs out of the 100 billion. Closing in on bill gates businesses, bill morrow. Briefly this summer he passed they are committed not to do a lot of large m a, it would bill gates to be number two, he is in there with bill gates, appear at this point jeff bezos and, you can see very positive depending what the stock price response as we take a look at does, you can see a case he mr. Branson there. Could become number one in the put a 12 multiple on that, world. Thats what you get for verizon. David, i point out, your reporting was interesting this decent price, but not decent morning. If they considered a bid two price. It is getting a bump today. Years ago, this is when jana they have to deliver if they deliver that 6 billion partners appointed a board in incremental ebitda, three member who at that time was the years, 50 to 70 by the way of ceo when he bought them two what they theyre going to return 75 billion in years ago. They have been thinking about this for over two years. Exactly. Shareholders, 45 billion in thank you dividends over the next robert frank. Thats nice we should go to probably lets send it to jon fortt for infinity and beyond, dont you whats coming up on squawk think . As we watch sir richard alley. Hey, david there, were waiting the first we have an exclusive with fdic trade on Virgin Galactic ticker will be spce. Chair joanna mcwliilams in a few first human space Flight Company minutes on squawk alley. To trade on the Exchange Data e i havent gotten your take on whether youre even interested can get very complicated. In this area as an investment but cdw will assist your needs and implement ive been asked about this a dell emc unity xt allflash unified one, half a dozen times this weekend. Storage platform. It is going to have such a great it delivers speed and efficiency, retail following while providing simplicity and flexibility. Tremendous retail following. For unified storage platforms, you need dell technologies, hes magic and it orchestration by cdw. People want a little bit of magic. I dont think we have seen sparklers above the post before. Thats a first through the at t network, edgetoedge intelligence gives you the power to see every corner of your growing business. What can i say . Hes a showman we dont have a lot of showmen from using feedback to innovate. Showmen have i dont know to introducing products faster. To managing website inventory. People want to own the stock, good luck. A lottery ticket. You see it as a is it and network bandwidth. Travel novelty what gets us past the novelty giving you a nice big edge over your competition. Stage . I think people think you know what, we dont know what the thats the power of edgetoedge intelligence. Future looks like, but he does and so ill bank on his future i had someone try to talk someone out of it this weekend and at the end, the person said hey, thanks, im going to buy a lot. Well, not a horrible open, obviously. Up 3. 5 . Well talk with him in the next hour are you going to stick around for this. What i like about it is that finally we have these deals that dont seem like they weigh on us, peloton. There is a peloton that is great, not just a hanger of lululemon clothes. Just not the same company. Talking about that made me think of direct listings, spotify, strong morning, up 10 on what were better than expected numbers line by line the numbers are better mccaffrey i thought might hurt it. Going to be stepping down as the companys cfo. But line by line is better. On to the board of directors. What can i say . I look at it, ive got no problem with any of the users. I have to tell you they have a much bigger base than apple. A lot to discuss here. And the premium the premium of spotify is 133 million, Something Like that yeah. Gross margins a little disappointing. A lot of trials. Yeah. But i do think that this is a company that did a direct listing, didnt have all that support. It has been doing well and maybe now it is getting recognition. You know what is interesting, mccaffrey came from netflix and this was all algorithmic in terms of what people want. And it is about time the stock started going up it is not a bad company at all i like it. You like it i like the podcast business the dominant podcast player. Yes, they are these are good numbers. We had daniel ek on with us. Yeah. Brought him on worked very hard for that booking. Sometimes you have to do those things, david, you make a lot of the street. Stocks are higher, the s p 500 hitting a fresh record in early calls. Im a benevolent person as well. Trading, dow less than a percent away now, strength in tech benevolent is what i think stocks offsetting weakness in of defense groups like utilities benevolent. In keeping with what the benevolence that Aaron Rodgers and real estate. Lets go to one of the other shows and brady shows. Outperforming groups, health benevolent care it lagged the broad other benevolent people. Lets get to the bond pits mashlgt this year, is 2 off this morning, Rick Santelli at recent highs december last year. The cme ahead of a busy week among names leading higher, i hey, rick. Busy week when you throw in the fed and will lumina, eli lilly all the question marks regarding watch the health care names. I will send it back downtown to how much Interest Rates around you guys at the new york stock the globe did not take a lot of exchange all right, dom, thanks very the bait of some of the data, much. When we come back, a lot more on todays rally. That has been airing a bit on dow session high u21p 0. The soft side. Think durable goods in the u. S were up 148 dont go anywhere. There has been soft numbers. Think germany. But no matter how you slice it, october is all about higher rates and higher stocks. Lets look at the twoiyear not. Up a handful of basis points, best close since about the 25th of september look at 5s 2s and 5s were under, they were under 145. Actually under 140 for the twoyear look where theyre at now. Look at tenyear note yields theyre at the best levels should they close here since around the 13th of september consider they were at 146. If youre on medicare, remember, right now were at 185 it has been a big month. The annual Enrollment Period is here. But by far the leader of the the time to choose your medicare coverage. Interest rate pack to the begins october 15th and ends december 7th. Upside, certainly at an up october, but their rally started so call unitedhealthcare and take advantage in ernest at the end of august of a wide range of plans with a variety of benefits. Look at bund yields, end of august minus 71. Including an aarp Medicare Advantage plan cut it in half, cut in half, from unitedhealthcare. This has been huge, theyre it can combine Medicare Parts a and b, leading the way. Were going to continue to try to figure out how the christine which is your hospital and doctor coverage. Lagarde regime will be different with part d Prescription Drug coverage, and more, than mario draghi because the market certainly treating them all in one simple plan. For a low monthly premium or in some areas, different and theyre certainly treating some of the not so no plan premium at all. Happy comments coming out of take advantage of primary care doctor visits. Germany as of late about Mario Draghis policies, times are preventive dental care and an eye exam. Changing for Interest Rates. All for a 0 copay. Finally, the dollar index, plus, earn rewards for completing wasnt long ago, little over a week ago, they were down to the other Preventive Care activities, lowest levels on the closing like flu shots and annual physicals. Basis since midjuly you could also get over 150 now they are building a bit of a rally, but we certainly have put in free health and wellness products. A bit of a dent in this psyche so nows the time to look at unitedhealthcares of traders that were looking to variety of plans, see 100 more quickly in that and let us help find the one that works best for you. Dollar index carl, jim, david, back to you. Also ask about our ppo plans all right, rick, thank you that let you see any doctor who accepts medicare, very much. As you saw a moment you. Without a referral. And take advantage of innetwork costs, s ps record highs at 30. 41 at home or traveling, when you see doctors in the Unitedhealthcare Medicare national network. Gains at s p back to 21 with many of our Medicare Advantage plans, you got the dow well above 21. 7. Youll have 0 copays on the most common prescriptions. In fact, last year our Medicare Advantage plan members be sure to check our podcast saved an average of over 6,500. And with renew active, enjoy a free gym membership cnbc podcast or where ever you hear them. We are back in a minute. 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This is where it could be a series of alphabet, there is a lot of companies that reported this week. It certainly isra realistic aftr the big run they would when you look at Companies Like microsoft and intel, it is doing so well. You look at united technologies, you struggle to find things that you need some sort of political blow off right now where we understand, the fed does the wrong thing, we dont need to do anything and some sort of weak employment you need see thats a serious stake is to happen if we think the president ran over the pentagon to get that contract for microsoft we know the president is adamant the feds had to cut rates. If you want to know why every company is just giving yo you here is the real currency the dollar will get crushed in any sort of usually not the feds issue. No. Unless you want to be a current manipulator. The rates are too high than anybody else the feds does not need to do anything, when you go through the all the companies, you wish that the feds would take it down a little more. Why cant we have 4 why cant we . Hes running for fed chair again. I will take his job in a second i am going to miss you. I would like to serve the country. My wife signed me up to do a long time ago. You got to wait for the election i think you got your shot did you see that on saturday, we are going out to dinner and shes making pizza unbelievable well see you tonight for mad money. Jim is going to stick around why not nyc in a few minutes. Well talk to Richard Branson and George Whiteside in a moment is the monolithic view of emerging markets obsolete . At pgim, we see alpha in the trends driving specific sectors of outperformance. Where a rising middle class powers a booming auto industry. A leap into the digital era draws youthful populations to mobile banking and ecommerce. Trade and travel surge between emerging markets. Every day, our 1,100 investment professionals around the world search out opportunities for alpha. Partner with pgim, the Global Investment management businesses of prudential. Good monday morning, welcome back to squawk on the street. I am Carl Quintanilla back with jim cramer and david faber all time highs today our road map begins with the record high for the s p on the busiest week of earnings how investors should be playing in a few days. Richard branson and George Whiteside, they all join us first on cnbc. Later on spotify cfo will join us, talking about the companys quarter and his upcoming departure s p near a record high including earnings from alphabet and apple and facebook jim, well get our first look at q3 gdp and well get jobs numbers where we know gm will take some off. This is a week where we would have been worried about chinese tariffs. It is interesting we are not hearing anything about it. The chinese are about to formalize something positive on agriculture. My checks there indicate just kind of taking off the table and start focusing on earnings again. Stock is up the most this year thats a Semiconductor Capital Equipment Company makes it so you will have the best chips that goes into data center that now passed chipotle it is being brought down by other companies thats not doing as well. The biggest loser right now is there is so much, i guess i dont want to say too light. But we just dont talk about trade. The president has not been tweeting about anything involving anything other than what happened in the middle east this weekend i thought it is interesting the president kind of trashed Speaker Pelosi saying it became a benign moment i could not think of what he said when this is the best day historically the best day of the year for stocks. Bulls want usmca they dont want european tariffs, they want this signing in chile there is much that has to go right. We seem to be fixated on technology thats suddenly going right. I saw recommendation of roku today. I thought it was completely over done no, someone has not recommended roku in a couple of days so it gets recommended microsoft is a great quarter an you think it is done i mean amazon was representative amazon was at 120 closing down at 19. Amazon did lose a contract or won a contract i just find the resilience of this market, carl, is incredible resilien resilience yeah. Some qb . Europe and reoperations here, you can get a lot done when money is so cheap, you can borrow it. Even netflix borrowed it pretty low rates comparatively i cant get those rates yeah, a big morning here at the nyc. Lets get to Morgan Brennan with some special guests today. Public investors have been waiting for a long for a chance to invest in this emerging new space economy. Virgin galactic makes its debut here at the new York Stocks Exchange joining me in a first Virgin Galactic founder, George Whiteside a whiteside, good morning to you all. Good morning. We like to make a squash. Absolutely. It is very exciting we had 50 years of developing virg Virgin Galactic where we put people into space, enable the public to come into invest alongside with us. I have been here with Virgin Mobile and virgin american, it is all done very well. We hope that our Spaceship Company will goes as well as others there is a lot of talk about milestones and first Virgin Galactic is the first publicly traded commercial human Space Company. How big of a milestone this is for commercial space life . I think it is a very big smile stone. If t milestone we have this wonderful take which i have never heard before. I was surprised you got that by the way i love to tell a story. The generosity we got off to a great start. It is up 11 on friday and, we manage to completely fund Virgin Galactic when it breaks even. And as an investor in this company now, i know you come on cnbc and talk about how impressive margins are how are you thinking of those Gross Margins when it does and what does it mean for profitability for the company . I think it is going to look as good as one of the best Software Companies around. I am so excited. You are in the business of software but it looks Like Software it is different than any of the technology this is a business that scales 70 of margin. It is incredible it is a testament of the billion dollars that richard invested before i came here and ready to commercialize and monetized. What do you think investors want to hear from this company the first vector is describe demand there are already 600 plus customers that have paid 80 million or 120 million for future businesses. There will be many more thousands after that who want to give us money. I think understanding that demand will be important for people to get comfortable around the longterm protection second is about georges execution ability and his team have to get these rockets in the air on a more frequent bases lets talk more about that, george i know the company is targeting to Begin Commercial Service and bag log right now. How big for this market for longer term. How many people are going to pay 250,000 for a ticket to space we are in