Transcripts For CNBC Worldwide Exchange 20240713

United auto workers president is sidelined amid his own federal investigation just days after settling that gm strike. It is monday, november 4th and Worldwide Exchange begins right now. Good monday morning im ndomini chu if for Brian Sullivan. Mcdonalds has fired Ceo Steve Easterbrook. Those shares down 2. 5 at this stage in the early extended trading session. Now despite the drop in mcdonalds shares, futures are still higher this morning. If you take a look at the picture overall, the nasdaq up by 38, dow 85. The s p hit a record high on friday treasury yields again a certain big focus for investors these days look at the tenyear note yield ticking slightly higher, 1. 75 the last trade there, twoyear note yields 1. R8 as well markets in japan were closed for culture day. Look at the overall picture and its green across the board. A half percent gain for the shanghai the hang sang up 1. 75 the asian side of things very much in the green. European trading is exactly what were seeing there as well the ftse 100 up three quarters of 1 . We will get back to the markets in just a moment, but first, a major shakeup at mcdonalds as the fast food giant ousts its chief executive. Rahel solomon joins us now with all of those details good morning. Good morning, dom so mcdonalds says that Ceo Steve Easterbrook has been fired for violating Company Policy by having a consensual relationship with an employee so mcdonalds did not provide other details but says that the board determined that easterbrook demonstrated poor judgment easterbrook has been ceo since 2015 he was previously chief brand officer and head of the Northern Europe business and uk he acknowledged the relationship and says it was a mistake. He says given the values of the company, i agree with the board that its time for me to move on easterbrook is being replaced by Chris Kempczinski immediately. Chris has been overseeing 14,000 restaurants. So under easterbrook mcdonalds sold off most of its companyowned stores to franchisees to help boost profits but the company has been struggling with declining traffic in the u. S. As its been spending heavily to remodel stores they have come urn fire for how it handles Sexual Harassment complaints mcdonalds stock is down nearly 9 in just the past two weeks after reporting missed estimates for the first time in two years. Dom, back to you. We appreciate it, rahel more on this story and others that will be driving the markets today im joined by Chris Campbell chris, there shall chief executives in the hot seat, the guy you could argue is the most in the hot seat these days is the chairman of the Federal Reserve bank in america, jay powell lets talk a little bit about jay powell as a person you used to work for him you used to work alongside our current fed chair back at treasury what kind of a situation is the fed chairman in currently . And how does he kind of navigate those waters look, i think chairman powell before he became chairman poil, look, he approaches the fed job differently than most fed chairman do. Hes nontraditional economists hes much smoother, very affable guy, very gregarious, very easy to like, but the job is very difficult. A fair read would suggest that theres a bit of uncertainty on the future every single day different headline and very different tweet that has he has to respond to but has to have longterm planning so he along with the fed governors could look at the Economic Data and be driven by it and remain independent but make sure their economy is resilient. President trump hand picked chairman powell to be in this position do you envision a scenario where the two of those folks could get together idealogically or come to an agreement about how americas Monetary Policy should be run look, i think they are idealogically aligned. They both want the economy to do very well. Theyre both pro market folks. I think obviously theres some tensions about where the Interest Rate may be appropriately put, but the chairman has and the fed have lowered rates. Making the u. S. Economy is incredibly resilient i kept saying we had this kind of wall around the u. S. That well insulated the u. S. Economy from a worldwide slow down and significant slow downs in some of the regions in the world. We still economic engine of the world and the world is relying upon us to do that. All right so the world is obviously looking towards the u. S. For Economic Leadership right now. The u. S. Is arguably providing it the stock markets hit record highs consistently multiple times over the past week and a half or so is this a scenario now where the American Economy is in a good position to keep that leadership role and power that engine that is the Global Economy . First of all, take off the table for recession next year. Thats hopefully in the Rearview Mirror there may be some epied soic slow downs were in a good spot going into 2021 hopefully the fed as you know does not intervene in Election Years. I think we see one more chance for the fed to do something in december before we dip into that crazy Election Year. Overall the recent jobs report and the two jobs reports in the past b revised up. Looks like it remains strong everything is hoping for and continue to maintain the resilient strong state that we have been. Its resilience its strong. You have used those words. From an investment standpoint, what does that mean for the markets overall as we head towards what could be a volatile Election Year . I think were we and our clients are very bullish on the economy and we think that this will be hopefully remain this bull market for a very long time its what our goal is and our hope is where my former colleagues in washington are and i know the president wants that clearly as well i think the chairman powell does as well. Are there places within the economy that you think will be doing better than others we have spoken a lot about how Technology Companies have been the driving force behind the market rally in the past few years and arguably longer than that does Technology Continue to assume that leadership role Going Forward . I think theres no reason why it shouldnt but i think some of the ipos had challenges as well recently. Probably some Corporate Governance issues and evaluation issues overall u. S. Equities are little overpriced the end of the day theres nothing suggests theyre going to reprice were in a good spot but a lot of money park on the sidelines as well. Well see how that goes. Chris campbell, thank you very much. Thanks, dom. Come back on the show, saudi arabia officially announcing to take aramco public well go to hadley gamble for more on whats ahead of this highly anticipated ipo. Plus, wilbur ross offering hope for huawei gaining access to the u. S. Amid renewed hopes of a china trade deal. And a busy week in washington as the impeachment proceedings against President Trump ramp up. Were live in d. C. With the very latest there, a very busy hour still ahead when Worldwide Exchange returns right after this Danafarber Cancer Institute discovered the pdl1 pathway. Pdl1. They changed how the world fights cancer. Blocking the pdl1 protein, lets the immune system attack, attack, attack cancer. Pdl1 transformed, revolutionized, immunotherapy. Pdl1 saved my life. Saved my life. Saved my life. What we do here at danafaber, changes lives everywhere. Everywhere. Everywhere. Everywhere. Everywhere. 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Hadley, what are exactly the next steps and what is expected to be this recordsettling Public Offering . I ask like weve been here talking about a potential ipo many times before. We have indeed, dom its one of the bigger questions as to exactly what the valuation on this company is actually going to end up being. So many questions about that and certainly not many answers in the press conference that we had out of delran yesterday. The chairman of aramco and ceo sitting down to take questions mostly in arabic it was tough to get in there as an International News organization but we managed to do it. We came away with more questions than answers they have refused to come out and give their estimate of the valuation of this company. Some will speculate whether this will reach that 1. 5 trillion the crown prince said he wanted this company to be traled between 2 or 3 trillion. Looks as if the banks wont be able to assist in making that happen, at least at the moment they did mention they are going to do a 75 billion dollar dividend what we know about the listing, the saudi stock market, at least so far they said theyre going to list in early december. They havent given a hard date yet for that but we also are asking the question of how much of the company is going to be listed a lot of speculation as to whether or not that will hit the 3 that we had heard previously. Remember, when we first started talking about this ipo three years ago, we were talking about 5 of aramco less than 3 really does speak to a company that in spite of the fact that they were able to come back so quickly from these attacks in late september, mid september, theres still a lot of questions about transparency and certainly not just external conversations about that valuation but internal conversations as well because i said it before and will say it again, nobody wanted to tell the big guy, the man who authorized this ipo that hes not going to get his 2 trillion a heck of a lot of questions but seemingly some answers slowly trickling out of the kingdom. The question that many investors, at least here in the u. S. Have, center around why we care so much about saudi aramco . Yes, its a big headline that this would be the biggest ipo in the history of mankind, this would be far and away the biggest oil and Energy Company in the world but why sit exactly that this is such a focus for investors and why should u. S. Investors care this is a broader question, isnt it its not just about u. S. Investors and why they should care and Foreign Policy, the Foreign Policy of the United States and certainly about the security of this region. Saudi arabia, their economy, the lynch pin of their economy, is saudi aramco and the health and the security of this Company Saudi arabia is the largest economy in the middle east everything that happens in saudi arabia has effect on egypt, lebanon. One big question has been where america stands in this region in terms of Foreign Policy, security and diplomacy and certainly over the last couple years at least not just under the obama but Trump Administration, serious questions about the supremacy of u. S. Policy in this region and that have very much tied to the security of Global Oil Supplies which means its definitely tied to the security of saudi aramco. Cnbc hadley gamble live in dubai. We appreciate it. Earnings season rolls on, a number of big names like disney and uber set to release their results this week. Well seat the scene for what to expect. Plus, under armour will post its Quarterly Results later on this morning as it finds itself the focus of a federal investigation. Details on the charges being levied against the apparel giant when Worldwide Exchange comes back right after this. But in. Thats why i take osteo biflex, to keep me moving the way i was made to. It nourishes and strengthens my joints for the long term. Osteo biflex now in triple strength plus magnesium. To take care of yourself. But natures bounty has innovative ways to help you maintain balance and help keep you active and wellrested. Because hey, tomorrows coming up fast. Natures bounty. Because youre better off healthy. Welcome back to Worldwide Exchange. Time for companies and stocks to watch today. Airbnb announcing a new Safety Initiative following a deadly shooting last week at a home rented on the companys website. In a series of tweets over the weekend, Ceo Brian Chesky says they are taking steps to get rid of abusive host and guest conduct by creating a Rapid Response team for unauthorized events big story there. In other corporate news, Fiat Chrysler is reportedly looking to finalize its merger agreement with its Parent Company of peugeot according to reuters. They are hoping to sign a binding memorandum of understanding in three to four weeks. Then Warren Buffetts Berkshire Hathaway was out with its Quarterly Results reporting its operating profit rose more than analysts expected. They say they ended the quart we are a record 128 billion dollars worth of cash on hand in those berkshire shares just about flat in the extended trade. Coming up on the show, the on going demonstrations in hong kong take a violent turn after a knife attack amid all those protests details on that and your mornings other top stories thats coming up straighahd. T ea high protein. Low sugar. Tastes great high protein. Low sugar. So good high protein. Low sugar. Mmmm, birthday cake pure protein. The best combination for every fitness routine. To take care of yourself. But natures bounty has innovative ways to help you maintain balance and help keep you active and wellrested. Because hey, tomorrows coming up fast. Natures bounty. Because youre better off healthy. Welcome back the impeachment proceedings against President Trump will escalate this week as nearly a dozen people are set to testify as part of the democrats probe. One big name on that list, former National Security adviser john bolton. Nbcs tracie potts joins us now from washington, d. C tracie, do we expect ambassador bolten and these other folks to actually testify so the other folks, dom, probably not bolton a wild card because through his attorney he suggested that he wont show up without a subpoena 11 Trump Administration officials are scheduled to testify in the impeachment inquiry this week. Four of them today most are political appointees not expected to show up as the white house refuses to cooperate. I think this week is going to be a big disappointment for those looking for new evidence. Reporter john bolton could be the exception the former National Security adviser who reportedly had issues with President Trumps personal attorney Rudy Giuliani directing ukraine policy boltons attorney has suggested hell only testify under subpoena its really up to the lawyers. I like john bolton i always got along with him, but thats going to be up to the lawyers. The white house telling people that under their employ you cant show up doesnt apply to john bolton. Reporter the whistleblowers offering to answer questions in writing. I think that individual should come before the committee. Come down to the basement, but he needs to answer the questions. You wouldnt call the whistleblower, you call the people who are actually there. Reporter there for the phone call between President Trump and ukraines president about aid and investigating joe biden. That call touched off this inquiry. Democrats plan to begin public hearing in the next two o three weeks with transcripts from private testimony released this week now, weve also got a new nbc news wall street journal poll that shows now the plurality of americans more than not, 49 think that not only should President Trump be impeached, dom, they also think he should be removed from office eventually if they get to that point, that will be up to the senate. All right nbc tracie potts live in washington, d. C. With the latest there. Thank you very much. Lets get a check on this other mornings top headlines. Phillip mena is in the new york news room with the latest. Good morning, phillip. Dom, good morning. Antigovernment protests got bloody when a knife wielding man slashed several people and bit off part of a local politicians ear. Protests there have been going on since june, but intensified this week when a high profile hong kong activist was barred from local elections. As california recovers from devastating fires that scorched nearly 100,000 acres and forced thousands from their homes, the president lashed out at california governor Gavin Newsome from twitter the governor fired back at trump he was excused from the conversation because he doesnt believe in climate change. The cdc is investigating a deadly salmonella poison linked to ground beef the cdc reports the outbreak killed one person and sent eight to the hospital. Investigators have not narrowed down a Single Source or a brand, but the majority of people who got sick reported eating ground beef bought from Different Stores dom, back to you. Phillip mena, thank you for those headlines. Still to come on the show, mcdonalds facing changes in the c suite after firing its chief executive Steve Easterbrook for an inappropriate relationship. Well talk how the shift will impact the companys efforts to turn around lagging domestic sales coming up when worldwide exan merit ck chgecos ghba 7, make natures bounty hair skin and nails step one. Its the number one brand uniquely formulated for silky hair, glowing skin and healthy nails. Natures bounty, because youre better off healthy. You should be mad they gave this guy a promotion. You should be mad at forced camaraderie. And you should be mad at tech that makes things worse. 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It nourishes and strengthens my joints for the long term. Osteo biflex now in triple strength plus magnesium. Mcdonalds firing its ceo over an inappropriate relationship were breaking down what that exit will mean for the companys efforts to boost its business. Green arrows as hopes for a u. S. china trade deal boosts futures this morning and its back, popeyes popular chicken sandwich officially returns as customers line up for hours to get a taste. Yes, its monday, november 4th youre watching Worldwide Exchange right here on cnbc welcome back to the show thank you for being with us on cnbc im dominic chu in for Brian Sullivan the dow would epiup by 113 points, the s p up by 15 and the nasdaq up by about 50 points adds well. Mcdonalds shares are trading lower however this morning on news the company has fired its ceo. Cnbc kate rogers joins us now with the full story. Shares up 2 its a dow component take us through what this means for mcdonalds and how it happened. Sure, dom good morning well, mcdonalds announcing late sunday that Steve Easterbrook was out as ceo Effective Immediately after demonstrating poor judgment after having consensual relationship with an employee easterbrook is off the companys board of directors memo to employees easterbrook said in part this was a mistake. Given the values of the company i agree with the board that it is time for me to move on. Beyond this, i hope you can respect my desire to maintain my privacy. Easterbrook took over in march of 2015 helping to reinvigorate the brand introducing new value items and alldaybreak fast and led the companys refranchising efforts selling off more mcdonalds locations to franchisees. But most importantly, easterbrook has been at the forefront of the experience of the future upgrades across the company with the selforder key of courses, new drivethrough technology he has also been key in the turn around plan which is why some analysts think hes a great successor to easterbrook and first came to the company in 2015 overseeing global strategy, Business Development and innovation details of easterbrooks severance package. Under his tenure the stock has climbed nearly 100 . He really helped to turn the company around. Its been a juggernaut in terms of a Consumer Company over the past couple years. You mentioned the analysts reaction to whats going to happen with kempchinsky as the new ceo. Can you take us through who he is and what investors might expect so i think its important to remember that Steve Easterbrook brought him on, hes also been the mcdonalds usa president for the past two years when we have seen a lot of momentum and gross in the u. S. Stores as all of these experience of the future renovations take hold. They did have a miss this past quarter, thats the first one in two years. So thats important to remember. Analysts say, yes, this was a shock. It was very sudden no one is expecting this chris seems like a natural fit to take over for steve maybe this happened sooner than expected obviously given the events that have unfolded here, but its not like its someone coming from outside the company thats not as familiar with the mcdonalds business hes been a part of this business turn around it will be a very busy day for you. Kate rogers, thank you for that update on mcdonalds lets talk more about this and other big stories that could potentially move the markets this week. Joining me now is tim seymore. A cnbc contributor and, tim, thank you very much for joining us this morning. You heard kate rogers report youre an owner of mcdonald stock, so an investor, how do you feel today look, its a strange day for mcdonald investors Steve Easterbrook on some level was considered to be a lightning rod bringing this Company Forward in terms of getting technical, changing the menu, becoming more of a healthful choice of investors after years of people being very concerned about fast food. Steve easterbrook brought a die nam toik the company thats been a flagship part of the mcdonalds story but accentuated an advantage and they have markets that this is still a major iconic brand its a sad day for the company its a difficult day for investors, but i think a lot of the news in terms of mcdonalds and the story and the fundamentals and really the bottom up here are very positive i dont think youll change the continuity in terms of stewardship of the company which has been very important for the last three years. Tim, quick question to follow up on that are you a buyer of this stock as the stock moves lower . We have seen charts here it has fallen decently from those levels is this a time to buy mcdonalds stock . You have to be watchful of the news flow in the next 48 hours. From what we have heard about the change and the roots of the change, theres nothing in terms of the company that scares me off. Mcdonalds is off 17, 18 off the highs. Its drastically underperformed the s p since august where a lot of the restaurant peers and fast food and quick serve players have some is the pain and stock is related to a market rotation overall. The valuation got rich for itself but that entire group rerated as people were looking for high Free Cash Flow companies benefitting from a consumer at least at the lower end that was doing very well in terms of jobs, et cetera so i dont think you run away from this stock and i think youre looking at an opportunity. Steve easterbrook was important but mcdonalds is an iconic brand. So tim, lets talk about some of that Broader Market dynamic you just referred to stocks rallied on friday Economic Data in the u. S. And around the world has been relatively better off as of late amid the fed rate cuts so take us through the dynamic if this move holds today, it will be another record again is the market justified at these levels justified, if you look at look, 70 , 75 of the s ps reported and actually we have seen a small earnings contraction. If you think about where investors are looking at the s p and the Market Dynamics are really all about a relief, we are slower but we are stable in terms of where people are seeing the economy. That payroll number with 95,000 of upward revisions from the two previous months in addition to being better than expected even with the gm strike, et cetera, is something that i think was a huge relief a couple days after the fed reiterated theyre not going to be certainly not hiking rates any time soon. You have a reaffirmation of the economy. Believe whatever you want out of the fed statement, but i think you have a backdrop for equities here where its really going to be about getting the phase two or certainly closing phase one of trade, but companies have tarted to give die guidance where theyre looking the Fourth Quarter and 2020 and its been okay i think thats the sentiment remind me a lot of where we were coming out of the throes of First Quarter of 2016, markets really actually tailed off and had a much more painful moment but if you think about the fall, theres certainly been those moments for the s p and dow. I think you have the sense of, look, were going to grow it 1. 5 to 2 . That will tell you that the market is not going to be following a Global Economy thats falling out of bed. Doesnt mean you get excited about global growth. Things are better than expected. So, on that better than expected front, we know expectations you mentioned the earnings season so far were doing better as is the case just about every earnings season i could remember for my entire professional life, expectations have come down fairly precipitously into the earnings season. As we talk about the overall context for record highs, is the earnings story still enough to power things or are we still relying on central baicnks and Global Economic picture that needs to improve it does but i think you have a case where stock expectations were certainly so well flagged coming into q3. If anything, the bar was quite low and as we get into q4 and people give outlook into 2020, im not sure we have felt the earnings pain of tariffs just yet. In fact, those companies that have certainly been able to stay in more of a domestic focus and have factors in terms of cost input and labor that remain rooted in the United States have done quite well. We havent really had a chance to digest the impact of trade and thats something that will way over markets remember, right now the consumption story in the United States has been that which has supported the entire stock market were rot record employment, at a place where the consumer and the demographic story continues to be very strong. This week we have an ism Services Number that people need to watch out for this in july or september or the july reading in october, july reading in august and the september reading in october were moments where the market got very concerned because we know this is a services economy. I think this is something we need to be watching the new orders input, et cetera. So its hard to get out there and do cart wheels but you have seasonal factors here. Its still at least for discretional is probably 2025 of where it has been historically its not high. This is an important backdrop for the market. Tim, before we let you go, one more quick thing for you here, we heard earlier this hour after years of planning, several stops and starts, saudi aramco, formally announcing its ipo yesterday. The aim is trading the stock on the todd well Stock Exchange by december now, there are other few other details out there. It could still be the largest ipo ever what does this tell us about the Global Economy and whether or not saudi aramco can get this done effectively yeah. Look, thats quite a bit out spread it tells you what saudi arabias interests are and Mohammed Bin Salman and the motivation to bring the saudi economy to a new era. I think this is obviously critical for him i think he staked a lot of reputation on this and the valuation is something that i think investors will wrestle over im not sure this is litmus test for the Global Economy or litmus test for the global ipo market its a litmus test for saudi ay arabia this certainly has been one of the most liquid and the most transparent markets in that region for a long time i think its a case where are looking to reestablish as an economy reforming and this is going to be certainly a big test of that but i think this is as you said four years in the making this is something they are going to get done and imperative they get it done and an important step for the region. Tim seymore, thank you for those thoughts on the markets. Well see later on today on fast money. Thank you for that on to a developing story this morning, under armour confirming it is the subject of a federal probe by the Justice Department and the s. E. C. Over its Accounting Practices the company said they began responding in 2017 to requests from information from regulators and believes its practices and disclosures were appropriate lets bring in now stacy thank you for joining us this morning. We have under armour earnings on deck sit overshadowed by news of these investigations that their accounts. 100 . Dom. I was prepared to come on and talk about q4 expectations being way too high, potentially Gross Margins being lower than expected, promotional environment out there, specifically for under armour. Now were just talking about an accounting scandal the Biggest Issue here is that this inquiry goes back to 2017 about six months after the inquiry started we had a cfo change three months ago on linkedin, there was an accounting officer job listing and of course two weeks kevin plank stepped aside and became brand executive chairman and brand officer so you roll this all together and say why didnt the company disclose this and bring it up before. So if that is the case then, were showing stock charts right now, stacy, because the underarmour votering class stock is currently down by 16 , very thin volume, albeit i will say this only 14,000 shares have traded so far. This is something that investors had responded to in a vu negative way because under armour seemingly turned things around in the stock in the near to medium term does this the specter of this derail the entire thesis for what underarmours moment was all about in the six, nine, 12 months i dont know that it derails the entire thesis, but it certainly raises questions on the Management Team and disclosures and why wasnt this put out there considering this has been going on quite some time and also certainly two weeks ago when kevin plank became executive chairman, everybody was wondering, okay, this turn around is in process, why would he step aside now . There was some questions, conspiracy theories then this doesnt help the situation. Clearly earnings will come out today. Again, i think under armour has been quite promotional, more promotional than they suggested which suggests north america is very negative. Nike, mid Single Digits and put all the pieces together and say this is difficult to invest and believe in a turn around story with all these questions circling around. Well see how the investigation pans out and what the explanation is today you mention all those things as an investor, analyst youll be looking at those without looking at the underarmour picture specifically, tell us how it fairs given can competitive landscape. We have nike, adidas, puma, and lets talk whether under armour can sustain this sure. So all those klting issues aside, look at the fundamentals of the business. Again, north america will probably be down 5 when they report today so thats a big delta between what nike is doing under armour was up 20 in china. Europe mid Single Digits they have done a great job of cleaning up the channel. And thats fantastic but the question is what happens next once you clean up the channel and you have less promotions, and you get those margins up, then you have to start moving the units. And the question here is, again, with the direct channel so focussed on the outlet business in north america and significant wholesale business is incredibly promotional out there, specifically for under armour, not for nike and the others, you know, we the question is what next how do we segment the product for success in the longterm thats still a big question mark. Big question mark for sure. Thank you very much. We appreciate it coming up on the show, new comments from commerce secretary wilbur ross adding fuel to china trade deal hopes thats coming up. Plus, tesla offers an update to better enhance its auto Pilot Technology a look at that and the other stories trending this morning when Worldwide Exchange returns right after this make natures bounty hair skin and nails step one. Its the number one brand uniquely formulated for silky hair, glowing skin and healthy nails. Natures bounty, because youre better off healthy. Man can i find an Investment Firm that has a truly longterm view . It begins by being privately owned. With more than 85 years of experience over multiple market cycles. With Portfolio Managers who are encouraged to do whats right over whats popular. Focused on helping me achieve my investors unique goals. Can i find an Investment Firm that gets long term the way i do . With capital group, i can. Talk to your advisor or consultant for investment risks and information. To take care of yourself. But natures bounty has innovative ways to help you maintain balance and help keep you active and wellrested. Because hey, tomorrows coming up fast. Natures bounty. Because youre better off healthy. Lets find out what else you will be talking about today, time for this mornings top trending stories for that we turn to rahel solomon. Rahel, auto pilot and a. I. In cars im still not there yet nor am i, but tesla is trying to help us get there so its working on making its auto pilot cars a little smarter. So the company rolled out an update this weekend designed to make the cars more adept at recognizing construction cones on the roads teslas auto pilot visualization system failed to detect and avoid cones. Now the vehicles will attempt a lane change so drivers no longer have to take control around construction areas the Company Still warn that drivers are required to Pay Attention at all times and some drivers say that the car is still unable to detect certain sizes of traffic cones now listen, for this technology, i feel like construction zones is the worst place to use auto pilot. Absolutely or around high pedestrian Traffic Zones or school zones or anything else like that. I wouldnt want to work in an area with auto pilot. We saw phil lebeau using the auto Pilot Technology. I can say im not there. Part of me the joy of driving is being in control i still enjoy that aspect of driving. You and i are on the same page here. Perfect. Popeyes chicken sandwich officially back. Apparently it has healing powers thats at least what texas tell me about this healing powers. Allege lid. This is according to Quarterback Deshaun Watson last week watson suffered a kic to the tas when asked about his eye during a post game interview yesterday he said the secret to his speedy recovery was none other than popeyes spicy chicken sandwich. Watson was in london when he made the comment leaving fans curious how he managed to get his hands on the sandwich. Youre the starting quarterback for the houston texans, you have people who will get you a spicy chicken sandwich. You have people,means, ways do we think hes angling for endorsement from popeyes. They should give him one at this point whatever works, right . Whatever works. Rahel solomon, thank you very much for the stories we appreciate it. Sure. In sports the Baltimore Ravens hosted the undefeated new England Patriots and the ravens came out of the game swinging. Qb Lamar Jackson rushing the ball in for an early touchdown and welltimed handoff to gus edwards puts the ravens up 1713 at the half. The patriots dont go down easily, but for the first time this season they cant seem to keep up. The ravens go on to beat the new England Patriots, 3720. I will just toss in there that means my San Francisco 49ers are the sole Undefeated Team in the nfl right now. Coming up on deck on the show, new comments from one airline ceo over the future of boeings model 737 max jet. Plus, the head of the United Auto Workers union finds himself in a federal corruption amid labor talks with another auto giant t sims xtde against h ine onhehow. Make natures bounty hair skin and nails step one. Its the number one brand uniquely formulated for silky hair, glowing skin and healthy nails. Natures bounty, because youre better off healthy. Doprevagen is the number oneild mempharmacistrecommendeding . Memory support brand. You can find it in the vitamin aisle in stores everywhere. Prevagen. Healthier brain. Better life. Welcome back to the show time for the headlines you need in 60 seconds. United auto workers president gary jones has been forced to take a paid leave of absence amid a federal corruption investigation. The Union Executive board voted to sideline jones after he was implicated last week in a plan to embezzle 700,000 of member dues jones has not been criminally charged in that probe. The ceo of ryanair says boeing 737 max aircraft has the potential to be a game changeser despite its delayed return to service over safety concerns speaking with cnbc earlier, Michael Oleary said its not expecting its first delivery of the 737 max until march or april of next year. Squawk box more on this coming up speaking with the cfo. An interview yesterday, commerce secretary wilbur ross said the licenses allowing u. S. Companies to sell to huawei will be coming very shortly ross also said the u. S. And china are very far along in phase one of a trade deal. For more on todays market headlines lets bring in strategy founder, jeff, always a pleasure to have you with us in the morning here lets talk about the record high in the markets its amazing we were so not so long ago talking about the idea of a pullback but one never really materialized. Is the market justified at these levels probably a little overbought on a shortterm basis, dom, but we said on the show after identifying the august 5th selling climax low that the equity markets were likely to trade out to all new time highs and our models are suggesting were going to go higher here. You could get a pause but theres plenty of internal energy in the market to drive this thing higher. People are still scared to death and people are under investing, including the big poll number people in the barrens, 27 bulls. Ive been looking at this stuff for 55 years i dont think ive seen only 27 of big money people bullish. So lets talk about the factors that go into these models that youre talking about because you have a model, a lot of other folks on wall street have models. What are the biggest factors the data points that go into why your model says we are due for an extension of this already very long bull market . Well, theres not many of us have seen a secular bull markets. They ten to run 15 to 20 years dont buy the fact that 20 up is a bull market and 20 down is a bear market. They be shortterm tactical bull and bear markets but secular bull markets are the one that lasted from 1949 to 1966 and then we went into a trading range until 1982 when you started the 82 to 2000 secular bull market. So the main thing that drives bull markets are earnings. Earnings are coming in better than expected. Roughly 1,100 Companies Reporting in s p 1500 index. You had 70 of them beat earnings estimates and revenues are beating at about 60 beat rate i think earnings are going to continue to come in better than most expect. Those earnings are going to continue to power whats happening in the marketplace overall, there still have to be overtail winds behind those earnings or those earnings are driven by a better economic environment. Does it worry that the fed is starting to see some signs of stress in the u. S. Economy its still growing albeit more modestly but also in the Global Economy as well. All that factors into the Bigger Picture macro stuff, right well, if you look at the economy, the economy is not all that weak. Ill be in chicago this week and your town the latter part of this week. Restaurants are full the economy, i think, is accelerating again if you look at the shipping stocks, they have hooked up suggesting that the International Trade is starting to pick up again so, im not in the camp that says the economy is going to slow and keep slowing. I think the economy is going to reaccelerate i think thats good for top line revenues and earnings. Good for bottom line earnings, tom line revenues r there plates within the market not geographically, stay in the u. S. , are there places within the market, sector wise that are going to outperform because of that environment that you outlined yeah. I think tech i think will pay up for true growth i think tech qualifies for that. Believe it or not the out of favor and financials have come on especially the regional banks, which is very interesting because the small and mid Cap Companies in this country get their money from regional bai k baichks. Its a very positive sign for the overall economy. Gotch ya. Perfect. Jeff saut we appreciate it this morning. Thanks for joining us. You bet, dom. That does it for worldwide exchan exchange. Squawk box coming up next. Well open at record highs. Good morning breaking news over the weekend, mcdonalds has fired its ceo over a relationship with an employee policy change for airbnb ceo speaking out after a shooting at a party house that killed five people. Underarmour shares are plum meting its monday, november 4th, 2019. And squawk box begins right now. All right, good morning, everybody and welcome to squawk box here on cnbc. We are live from the Nasdaq Market site in times quare im becky quick along with joe kernen and andrew ross sorkin. Check out the u. S. Equity futures at this hour youre going to see that the dow looks like it would open up 110 points if we were to open at these levels which would be a new high s p 500 if we hang in there at these levels up by 13 points also new high. Nasdaq is up by about 45 points. At least end indicate based on the futures right now. Lets look at the treasury yields treasury market right now is going to show you the tenyear note is sitting at 1. 754 . The big news of the morning, the board of mcdonalds announcing yesterday they fired Ceo Steve Easterbrook over consensual relationship with an employee the company says he demonstrated poor judgment. Easterbrook called the relationship a mistake a