Transcripts For CNBC Squawk Box 20240713

Of december and november was a very strong month for stocks, even though you did see some declines on black friday youre looking at the best returns we saw since june for all of the major averages. Last week again, you did see some big gains too right now the dow, s p and nasdaq are still less than 1 to 2 of the intraday highs with these gains, youll see them challenging that as tom mentioned. Although, i also remember last the first trading day of december last year. Not quite as much fun. I still have some night mares about that. Would not be the only one with scars leftover from that. I think the dow was down 15 at one point in december last year we were having a great year. Markets were up, not up like they are this year. Bottomed on christmas eve, december 24th and saw things take off from there. Its been a very strong year. Will a santa claus rally power the s p 500 and dow to their best year in a generation . Could happen. Were up a lot. What will that take to get there, 5 . Probably. But youre getting up in the 3s there, arent you . Which you probably wrnd around, 94, 95, 96 three years of plus add that up. Things double. Whats the rule of 72, 72 divided by 30 basically 2. Yeah. Like two years things double in two years. Most of it is earnings driven as well. Theres some multiple expansion. But a lot of Earnings Growth. Its a goldie locks low rates. Low unemployment no inflation not much still a lot shaking of recession. Well look at jobs this friday with the jobs report coming out but is expected to show more strength and the consumer. Its been a strong consumer and just like this Holiday Weekend continues to be. We should have a pretty decent Holiday Season. These are big gains i think where are we, 3180 or something. Where are we on the s p. 3140. The record is 3150 and change. But you know, were supposed to be at were indicated up by 13 points this morning. You saw the ten year higher yields 185. President trump just tweeting couple thing. This is one of the things he said, brazil and argentina presiding other a massive devaluation of their currencies which is not good for our farmers. However, therefore effective immediatelily restore the tariffs on all steel and aluminum that is shipped into the u. S. From those countries. The Federal Reserve should like wise act so to the countries of which there are many no longer take advantage of our strong dollar of further devaluing their currencies makes it hard for our manufacturers and farmers to fairly export their goods. Lower rates. And loosen youre rooting for higher rates to show us that were we have an improving economy. Yep 185. He tweeted Something Else which was kind of you dont see President Trump quoting Chris Wallace very often, but he did this morning in a positive Chris Wallace, something that played into the president s hand instead of against president s hand hes tweeting Chris Wallace. Thats not always in a positive way. Black friday shoppers spent less time in stores. More time shopping online this year we cant travel online, can we cant travel online. Thats always going to be an issue, weather. Right. You can wait an extra day if youre something you order online doesnt come, but you dont have to go to the stores, do you one of the interesting thing with the stores, look what theyre doing with buy online pickup in store and the other thing that companies are doing, theyre offering coupons now to come back later in the month if you spend a certain amount. They need a whole new staff that doesnt wait on customers grabbing stuff to shop for people. It creates problems for a lot of these companies for walmart, they have the fulfillment people going through but theyre kind of taking stuff off the shelves that the guy who runs the store wants on the shelves for those reasons. They report through to different lines. Online sale strength isnt always strength for stores. Right. Today is cyber monday. You can bring more traffic coming through. Courtney knows about this its cyber monday, courtney. Youre at a have they asked you to push anything around and grab some stuff off the shelves yet . Youre in bethlehem at a Fulfillment Center i dont think i can it looks like everything at me is random but its done very purposefully youll see cat food next to a frozen toy and thats done on purpose. Im not allowed to touch anything because ill screw up the system, but this is just one of walmarts six fulfillment campuses around the country thats going to be fulfilling those online orders today on this cyber monday. And also potentially some of the orders from over the weekend still coming in. Today the National Retail federation thinks 69 million americans will shop. Even though we set records on black friday, today is expected to a record day online with sales up 19 hitting 9. 4 billion. If that happens here in this country, well be the biggest day of the year and the biggest day ever in the United States for Online Shopping. But just like black friday, the timing has sort of shifted for cyber monday remember in the older days you didnt necessarily have high Speed Internet at home or computer that had access to it and you shopped once you got to work for cyber monday so the peaks were in the morning or midday around lunch, not anymore. Today the peak is expected for cyber monday, peak volume to happen much later tonight between 7 and 11 00 p. M. Pacific time that is a big difference that has been happening over the years, too, even with the Online Shopping now, deliver is a company that helps Third Party Merchants fulfill their orders so they work with merchants on walmart. Com, ebay, shopify and said on black friday that their average daily volume was up 3. 7 times compared to a normal recent friday and that was higher than last black friday when their volume was three times as heavy so well see if that continues for the Third Party Merchants on some of these platforms here today. In store getting preliminary results. Shopper track says that thanksgiving traffic in store was up 2 but that black friday in store traffic was down about 6 , so that evens out to down 3 over those two days at least the preliminary numbers were showing like we said Record Online so so far still shaping up to be a strong season and we got a big day ahead. Back over to you guys. Courtney, one quick question for you. If the prime is expected to be 7 to 11 00 p. M. Pacific time, thats aftermidnight east coast time so do those sales even count for cyber monday sales or do they get kicked to the next day . Thats a good question. I think that they do count because i think it depends actually on where that person was in the time zone that theyre in and how that counts but even i looked at that time too i thought 7 to 11 pacific time, what does that mean for eastern time and actually last year and then even on prime day, we did see actually some pretty high spikes around that 10 00 p. M. Eastern time so once the kids are in bed, dishes are done, you crawl into bed, you have your phone and you order that one last thing. So, we actually did see that similar pattern even on a prime day this past year i dare you to turn around and touch something. Come on. Do it. Touch it switch it around. I dont want to do it. Just touch it. Move the labels do something. Just touch it you did it you did it well done. Reporter i did it. Breaking the law. Thanks. Breaking the law. Block chain they cant tell you to not do it courtney, great to see you and check in later. Thanks. You, too. Joining us to talk more about cyber monday and how the Holiday Shopping weekend went, the ceo of tellsy Advisory Group bhach did you think . I thought it went pretty well walmart did it right after halloween and saw a lot of others like that, too. Now its considered a fiveday weekend not just a twoday weekend or a threeday weekend and you still have a long way to go so its an on track weekend so far. Black friday companies are opening on thanksgiving day opening at 5 00 p. M. To 1 00 a. M. And coming back on black friday it was slow friday morning it picked up in the afternoon. Luckily this weather on in the northeast didnt happen until yesterday plus we needed saturday also. Although, a lot of the country did get hit over the weekend. Did that affect places like minnesota or yes. Some of the other great plain states. Except. It hit some of the west coast also so youre going to see some of that impact. But they can order online, too and what you mentioned about the stores before, fulfilling orders is part of it. They will right size in the terms of the way they are. The size of the store the size of the store may not how much is going to be for fulfillment, how much will be for showing goods. Its all going to look different in a couple years just like the patterns of shopping are different today. Who are the big winners would you say at this point in the Holiday Season best buy big winner walmart and target big winner. It was all the big box players dicks sports goods a big winner. I heard lulu lemon was a winner this Holiday Season. Big box off price also won i think the Department Stores are still a little slower. Dana, the total sales for today are expected to be around about 9 billion, 10 billion. When you compare to alibabas singles day its a drop in the bucket. Right. So where does this end . Does this just keep going in the u. S. More and more online sales . Does retail just collapse for these types of goods to effectively nothing excluding luxury and jewelry and high fashion . Convenience and ease matter but something to be said for tradition and experience of it. The smell. Well, some of it. Bathrooms. Consumers doing with this with their kids together with families its an entertainment and sport. So i think youre always going to have Something Like it. Theyre all mixed together. Sometimes people hustle and bustle and makeup counter not at the makeup counter, walk by the makeup. I have people do that for you. You getting used to that talking about makeup and stuff with your buddies. Its a little weird. I dont mention it actually yeah. You got some on today. Even though, i would argue that come in here without anything fragrance is one of the top categories better get used to it. Tom never show your tells like that. Now you just relegated yourself to hours and hours of makeup jokes. Im blushing but you cant see because im caked in an inch of makeup. Thats one of your stories. Good you do realize hes hunting probing one of the things i find interesting is you look at some of the Luxury Brands and theyre instore traffic is increasing but yet Everything Else we see is how instore is going away. It feels like in the future thats what store traffic is. That experience and look what companies are doing for experiences. I was in bloomingdales last night and all of a sudden they have different areas where you can take a picture with something or every single floor theres something that should attract a customer there and some is through the food that companies are doing youre seeing singers. Youre seeing entertainment. Look at some of the active stores they have batting cages in order to play baseball so, its a new world out there in terms of how you have to marry the activity of buying with the activity of doing dana, thank you great to see you. Thank you. One more quick question. Sure. What overall percentage of sales are online sales at this point . Watching it creep up every year. It could be near 13 of sales. Wow. Yeah. Its moving certainly higher. Dana, thanks a lot. Thank you good to see you, too. President tweeting one minute ago u. S. Markets are up as much as 21 since the announcement of tariffs on march 1, 2018. The u. S. Is taking in massive amounts of money and giving some to our farmer bhos have been targeted by china. Coming up, we will get you ready for the final trading month of the year. That would be december is it december it is december 2nd. Thus is my watch only 30 days in november so it gets messed up we can put a man on the moon supposedly after last years december south, that 8. 7 drop for the dow, what can you expect this year doesnt look like it so far. Good start to the month if we were to hold these gains up 108 on the dow. The s p indicated up 11. The nasdaq a solid 27. 5 points what are you doing back there, junior . Since were obviously lost, im rescheduling my Xfinity Customer Service appointment. Ah, relax. I got this. Which gps are you using anyway . A Little Something called instinct. Been using it for years. Yeah, thats what im afraid of. He knows exactly where were going. My whole body is a compass. Oh boy. The my account app makes todays Xfinity Customer Service simple, easy, awesome. Not my thing. Welcome back, everybody. Some positive Economic Data out of china manufacturing numbers surprising investors coming in stronger than expected. You look right now and see the nikkei closed up by just over 1 there were also gains for the shanghai composite and the hang seng eunice yoon is in beijing and joins us right now eunice, whats going on . Thanks so much, becky it was the november pmi data and it beat expectations this was for the private index, which tracks Business Conditions for small and mediumsized companies. And the number came in at 51. 8, which showed manufacturing expanding at its fastest pace in three years. So this number came after the official number, which tracks a large manufacturers and released over the weekend also showed a recovery thats because of a rebound in output in new orders. The nonmanufacturing pmi also jumped from an eightmonth loeld to an eight month high all of the stronger data could potentially give some more confidence to the chinese negotiators to believe that they might have the time to continue to wait for better terms for a trade deal in the state press today yet again, there was no wavering at all in beijings position, especially when it comes to tariffs. The communist party paper the global times quoted a former chinese official for the phase 1 trade deal having the u. S. Roll back tariffs is a must also today the Foreign Ministry announced countermeasures against the u. S. For its support of the hong kong human rights bill the Foreign Ministry said as of today china will suspend port calls for the u. S. Navy and sanction several u. S. Based ngos for, quote, supporting what it described as extremist, violent activities in hong kong. So china isnt still still isnt linking the hong kong situation to the trade talks, but you can imagine that the tensions arent really helping the discussions between the u. S. And china. Yeah. Were watching that, eunice, obviously. Initially once you signed it, i thought uhoh. But the reason the markets handled it so well was because there was sort of the body language that we still were not going to let this affect us. Didnt really mean it. We want a deal. Maybe china does need a deal maybe people like cramer and others that point that out that maybe there is something even though trump it was a vetoproof majority that we had in the house and the senate. So it wasnt going to matter any way. So china i think knows that and maybe thats part of it, too but well see. Yeah. I think that a lot of people here, joe, did understand that, that even if President Trump were to veto it, that it was going to go through any way. So when i was talking to people here, they said, oh, hes probably not going to do much. Hes just going to let it pass but, they have been reading his body language. Yeah. But even so, the chinese, they want to have a trade deal its just the terms. Thats whats really important and so, you know, were just seeing it over and over again in the staid media and discussions that they really want to have tariffs lifted and one official, this is the same thing we heard, it doesnt matter how or when its lifted, in phases or all at once, but at the end of the day its a face issue. They want to make sure there are tariffs lifted in order to make sure they can market back home that china got Something Back out of this as well. Eunice, thank you we could talk longer still orlando is dog gone bullish im afraid to read this. Im not afraid made me feel good. The hair on the back of my neck is like wow this is the greatest times this is like youre describing goldie locks. We have a lot to be thankful for. I got misty when i read that its true for thanksgiving labor market hasnt been this robust many in a half a century. Suddenly wage growth the pace has doubled over the last decade. Stock markets more than quadrupled since the bottom of the Great Recession, longest expansion 126 months no recession on horizon, no inflation, 11 decline in gas prices anything worrying you . That worries me that nothing is worrying you. Well, its all good we just talked about is china going to happen . When i was on two months ago we thought that the october 10th meeting was going to go well and the apec summit would be the closing deal. Oops. That got cancelled. Now were struggling to find out when is this thing going to be signed so you have the nato summit in london this week does it happen this week i dont know thats interesting. You have this december 15th is the next date at which the next level of tariffs are going up im hoping that we can get some cooling of emotions ahead of that but thats the one fly in the o ointment, joe. Yeah. Are we able to consummate the skinny phase 1 deal . What about weak Manufacturing Trends the fly in the ointment. Joe read the rest of the note on camera, theres been this dichotomy between strong consumer, weak manufacturer. We look at the weak manufacturing, were identifying three sources. This on going trade and tariff problem with china the gm strike and the boeing situation. The gm strike has been settled were hoping we can get some better news out of china over the course of this month we think that max boeing situation is starting to make some progress, we get into the First Quarter of next year well get some fixes in place. So as we look at calendar 2020, we think the Fourth Quarter here, Fourth Quarter of next year are going to be still soft relative to manufacturing, but at that point Second Quarter on we start to see reacceleration. That represents a different point of view for fed rated versus a lot of firms that there was an article in the journal over the weekend that the rest of the street is sort of looking for a deceleration in Economic Activity over the last of the year we think that deceleration has already happened over the course of the last 12 months. Were at a trough now starting to turn and that turn will accelerate starting in the Second Quarter of next year. A lot of the people that i speak to, the private Equity Community dont think it will be a deceleration but an outright recession. Do you see that as i hear you that your base case is were at a trough and things are improving. Is a recession possible next year no. Our proprietary recession dash board has been very clear on this, no recession in 18 or 19 or 20 the earliest that we see a recession is the first half of 2021 probably towards the middle of the year. So we dont see any risk of recession looking out over the next 12 months. So you do people come up and tell you, wow, phil, you stuck with this. Youve been steadfast for 18 months well, thats the thing. That this time last year we were looking for 3,100 s p this year. And that was a wildly out of consensus number. Right. We got there two weeks ago. So now were looking for 3,500 number, looking out full year 2020 people are saying, you were lucky last year. Youre not going to be lucky twice in a row we think the fundamentals are still strong you have benign inflation but relatively low Interest Rate so our target multiple over on 18 times earnings in our view is a reasonable number. Were looking for 2. 4 gdp growth for the u. S. Economy next year the street is at 1. 8 the difference between the two of them in our opinion is that weve got a more marginally constructive view on china and the rest of the street we think china is actually were going to see some skinny phase 1 deal and then corporate earnings we think last year, this year, 2019 was a consolidation off of phenomenal 18. We think we get low toed mysingle digit pace of growth next year. 180 Earnings Growth or Revenue Growth both. Low to single correct if were al 180 in s p earnings for next year which is our forecast and 18, 18. 5 multiple get to our 3,500, yeah. So what is that high Single Digits in terms of where we are now, 3150, were looking at 10 high single, maybe just double digits. Spoiler alert, were not going to be up 32 next year, but we do think it will be a positive year. And the 18 p. E. May sound high to people if they think of the historical p. E. Averages Interest Rates at 1. 8 thats the point. Core pc at 1. 7 and treasury yields at 175. That environment, 18, 18. 5 multiple is perfectly legitimate. Or higher. Phil, great to see you. Hey, becky, thanks for having me. When we come back a new report says that private equity money is piling up thats next on squawk box. Each day our planet awakens with signs of opportunity. But with opportunity comes risk. And to manage this risk, the world turns to cme group. We help farmers lock in future prices, banks manage Interest Rate changes and airlines hedge fuel costs. All so they can manage their risks and move forward. Its simply a matter of following the signs. They all lead here. Cme group how the world advances. Cme group vo the flock blindly flying south for the winter. They never stray from their predetermined path. But this season, a more thrilling journey is calling. Defy the laws of human nature. At the season of audi sales event. U. S. Private equity firms are reportedly struggling to find ways to spend the record amount of cash theyre sitting on u. S. Buyouts by these firms hit just over 155 billion in the first ten months of this year, but the cash levels for those north american buyouts hit a record 771. 5 billion. The journal sites already expensive takeover candidates getting more costly as part of the cash build up. Our guest today is tom farley. Its phenomenal looking at the premiums paid to take out companies. It makes these buyout firms more nervous. We have to make sure the math works before we make a purchase. The whole game 20 years ago you buy companies for a lower multiple they would otherwise trade public market. Now when they find a company in the public market, pay a premium, take it private and really have to run the business perfectly. I think this year m a activity overall in the United States is about equal to last year, but private equity firms are raising so much dough. Blackstone raised 25 billion in a single fund this year. Just thats just one of black stones many funds you keep hearing numbers like this of vista also raised a giant fund i think it was 17 billion. Its hard to deploy that capital. Warren buffett has 128 billion in cash in hand according to the latest s. E. C. Filings. Theyre looking for ways to deploy it, too and budding up against private equity tech data is a company that got taken out by apollo. Buffett bid over that and apollo bid over that. He is stepping back but stepping into places they hadnt before. Its a mie koe come of what we were talking about with private equity apollo makes an aggressive bid to start, paying a premium for Large Public Company Warren Buffett comes over the top with a bid substantially higher, 6 higher, all cash. 130 a share to 140. 130 to 140 and apollo within a few days came become and raised it another couple percent to 145 so much money sloshing around that even Warren Buffett paying all cash quickly, paying a full price cant get a deal done. Yeah. Interesting to watch in the markets. Having said that, people will still look at stocks and say, theyre not necessarily overvalued buffett made the point earlier this year he told us that the premium youre paying to take out a whole company is much higher but still much rather buy stocks than put money in treasuries look at rates so low and where stock prices are, the valuations could go up from here. That seems to be the theme of the morning. We just talked with rates at 1. 85 paying the market multiple seems reasonable. Coming up, travel. I did some traveling wow. That was fun be thankful youre home theres a lot of people traveling back this morning. Youre in. Yeah. You have a lot to worry about delays but its not just to land on a runway thats not icy is a better way to go than icy one. Travel might nar more than 1,000 flights cancelled on the biggest travel weekend of the year. How good are these guys and these Companies Getting you up, getting you down, all of the different planes coming in and out of the new york area its amazing your road warrior update is next you actually do have to be one we have to get you and also tell you about gifts under your tree that could put youre privacy or bank account at risk squawk box. I think thats one of santas, see, thats what confuses me those were his helpers thats not really the santa. Squawk box will be right back. 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Invest with confidence. 00 good morning, everybody, this is squawk box. Welcome back we have been watching the u. S. Equity futures on this first trading day of the month and youre going to see that right now there are some green arrows. Actually we cut our gains by about half since we started watching this. The dow futures are still indicated up by 65 points. S p futures are up by just over 6 points then the nasdaq is up by about 14. 5 heavy snow is in the United States cancelled more than 1,000 flights since yesterday. And delayed thousands more the Winter Weather turned the busiest travel day of the year into a bit of a nightmare. The storm is expected to dump a foot of snow in the boston metro area by this morning and also brought freezing rain and snow to an area of the great lakes to the northeast. The sunday after thanksgiving is also the busiest day of the year for americas roadways the snow and the freezing rain created slick conditions and traffic jams for millions of people driving in the northeast corridor as we mentioned, its not over yet. People are still trying to get back and that Winter Weather is continuing in the northeast this morning. Aply, disney east frozen 2 setting a box office bringing in 123 million in north american ticket sales over the fiveday weekend. That beat the previous record of 110 million set by hunger games back in 2013. The global total for frozen 2 reached 738 million, well on its way to becoming disneys sixth movie to gross more than 1 billion globally this year despite the big block busters from disney, to date the box numbers are lagging by 6 . Coming up a Holiday Shopping season officially under way. But be careful what you buy. We have a list of the tech gadgets that would be compromised by hackers or foreign governments. Later dont miss our guest host michael ruben. Well talk the state of the Sports Industry sort of is a proxy for how many jerseys you sale its back. Really is because of draftking i had a good day yesterday three out of four. Stay tuned you had a good day back to 580 months of toiling and youre up 80 bucks. Im up after. I havent put a dime in. 500 in im 580 okay what is that, thats like 15 , isnt it announcer todays big number, 143. 7 billion thats how much americans will spend online this Holiday Season, according to an estimate by adobe increase of 14. 1 over 2018. 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. Theres one thing you can be sure of. Theyre changing by the nanosecond. Thats why cognizant created a unique engineering approach to design and build new digital products. Learn how cognizant softvision designs experiences and engineers outcomes. Cool. Bengals. Theres the Cincinnati Bengals and then theres the bangles. Our off air conversations work their way into the show. The gifts and what was you knew the lead singers name. Suzanna hof. You like her voice . Well, i first got into their music when i was 13 years old. The fact that she was a beautiful woman and terrific singer. Easy now. Easy now. I was a fan, too. Okay. There you go give him credit. I had no idea that gender im totally blind to all that stuff. The gifts under your Christmas Tree might be spying on you or putting your accounts at risk. And these four gifts from huawei, lennova, are prime offenders. Joining us with a closer look at the tech gifts to avoid this Holiday Season, lets welcome rosalynn lleyton cofounder of china tech threat. Com and aei visiting scholar and rosalynn, i identify with this whole segment because my alexa has never come out of the box. Once i thought about it, honestly and its just im not ready to move into the future like the rest of the lemmings now i have to worry about tell us about these four one at a time what do we have to worry about. Sure. Well, i have so for example i have a huawei phone with me today. You know, youve probably heard a lot about huawei in the news because of the network equipment, but this is a phone that you can buy, sell on amazon, but about half of all huawei phones have been identified to have a back door, security vulnerability that will allow your you to be watched, your data to be siffened away and you have no idea that thats going on thats one example the other would have lenova ideapad. It was once an American Company owned by ibm and bought by the chinese. That company was fined by the federal trade Commission Last year for privacy violations where software was installed that was tracking people on the computer has also a fingerprint Identification System which can also steal your fingerprints alex mark printer yet another with security vulnerability and the go pro cameras as well have a glitch that can allow a hacker to infiltrate them and get your data so youre absolutely right to be concerned. Go pro . Go pro is on the list, too yes well, because it has its not a Chinese Company but has a glitch in it that can be infiltrated by hackers so, you know, these are just i think the challenge here for consumers is that theres a lot of things that they can buy on amazon and target, walmart, best buy. They have no idea that there is security vulnerabilities in there and our sort of regulatory system, even though we have lots of regulations all over the place, it doesnt follow through to the end consumer. And you have no disclosures on the phone. So i agree with you. I understand if you feel concerned about taking the alexa out of the box because, you know, we dont have full assurance of whats in there. I think theres safety in numbers. Everybody has an alexa even samsung tvs, is that true that samsung can actually have a receiver in it to pick up conversations . I dont know whether that may be an urban legend. Go ahead let me explain theres a couple reasons what could data be used for. Its not necessarily you might not experience attack in your life, but part of the reason is that theres a lot of large chinese i. T. Companies, tech firms, who compete with facebook and google who want to be able to enter the american market, same way that tiktok has and so, our data can be accumulated and assembled into data bases in china where Chinese Companies can study them to look at how could they market to americans so its very passive nothing that you might experience harm in your life, but your data can be used and assembled in those ways. If, for example, you would work for a major firm and might have access to intellectual Property Information or other kinds of Sensitive Data within your company, thats also a point of vulnerability. If you recall the opm hack, office of personnel management, over 30 million records of americans working for the government they had extremely valuable information they were employees. They had security clearances and so on and those folks they were particular people who had access to information they were hacked by hackers working for the Chinese Government and they have experienced some Identity Fraud in their life and other problems you mentioned so this is one of the things that you might not experience it today but it could be your data is being assembled into a giant data base to study what do americans do and Chinese Company can come in and market to particular segments. Rosalynn, you mentioned tiktok if it werent for school and their parents, our daughters would be on tiktok all day long. They absolutely love it. Is that something that should give moe and millions of fathers and mothers like me pause . Definitely. I mean, even certainly for kids this is a tool used by child predators, for example but on another level, a lot of American Military people have been using that tool and it knows exactly where people are so, soldiers who are in the field, when they have time off they might make a video with a tiktok app that data goes back to a server in china, operated with an affiliate of the Chinese Government and can find out where American Military people are and their interests and so on so its really scary and we may the kind of rules and restrictions we have on the books can some extent protect or restrict certain parties from using this, lets say youre working for the navy or Something Like that. Not necessarily. There are so many products and services out there that have data being brought back to in cn be processed, analyzed youve probably seen the social Credit System working in china that is now being performed on americans and we dont even realize it. Amazing im glad aei is watching all of this keep it up im willing to give away a lot of privacy for google maps when people ask you you give permission to do it. Check us out on china tech grid. Com. My information is worth money, too, and no one pays me for it either. Absolutely. They steal it and i search something and the very next moment i see an advertisement for a hotel in that area. Because youre using the search engine. Im okay with that. I dont want them sending it to china so that they right which is why go pro surprised me. Roslyn, thank you for being with us this morning appreciate it. When we come back, we will tell you what these three stocks have in common amazon, home depot and activision blizzard. Well tell you why it may be meo d emti tadth to your portfolio as we head into the end of the year. Step up, please. Empty your pockets. Looks like youre all set for that business trip. Youve got your smartphone, laptop, your other smartphone. Woman is this all the devices you have . Your tablet. Seriously . Smartwatch, your backup tablet, and. Woman anything else in your bag . Whatever that is. beeping this isnt working. Introducing Samsung Mobile workspace solutions. With the galaxy note10 with dex software, you can run your entire business on the one device that does it all. Samsung business solutions. Cyber monday kicking off a few hours ago. Our next guest says amazon is her topics heading in. Leah bennett is westwoods Wealth Management president. Why do you like shares of amazon its interesting. Online spending certainly continues to take share so amazon obviously dominates the group. They represent 40 cents of every dollar that people spend online. Theyve definitely dominated the market they continue to innovate. What we basically are looking for next year is an increase in share. Whenever you see innovation and profitability, they are usually not coupled or linear. You think this is a downturn thats going to be a temporary one and the stock will go back up definitely. I think theyre going to utilize technology a lot better in order to drive the bottom line you see the use of ai and driverless trucks. Theres lots of ways to improve profitability going forward. Your next stock took a hit last month after it reported mixed earnings home depot, you think thats a similar situation where this is a one off and theyll come roaring back, too . Yeah. Theyre around new strategic initiatives. I think that will be the case going forward. The loss in profitability due to increased spend around these strategic initiatives, its not lost, just deferred until next year i think youre going to see a return to profitability. The consumer is extremely engaged in spending. Were close to the end of Time Activision blizzard. Strong Balance Sheet. Very strong Balance Sheet they dominate the space. They have fantastic names. Call of duty will be strong this Holiday Season leah, thanks for coming in. Pleasure. Coming up, were going to talk about cyber monday shopping here it is a live shot of an amazon Fulfillment Center in realto, california you have to take our word for it could be next door back east Courtney Ragan is on the cyber monday front line. That sounds dangerous. One of walmarts six Fulfillment Centers. Put your hair back or something. I dont want it to get caught in one of those things. Whats coming up reporter i know, right theres 12 miles of conveyor belts. People are already shopping. Products flying around were going to tell you what to expect on this cyber monday as were live in a walmart Fulfillment Center in bethlehem, pennsylvania, coming up on squawk box. Have you ever worked with dr. Francis . Oh yeah, hes ok. Just ok . Guess who just got reinstated well, not officially. Nervous . Yeah. Yeah me too. Dont worry about it, well figure it out. Ill see ya in there just ok is not ok. At t has americas best network, now with our best plans, at our best prices, starting at 35 a line for 4 lines. New from at t. Ready, set, shop this should be the most wonderful time of the year for the retail industry. Early winners and losers straight ahead. 21 days, thats how many trading sessions are left in 2019 we will get you ready. Plus, taxing wealth as democratic president ial hopefuls bash billionaires, were getting new polling information on what young voters think about that topic. The second hour of squawk box begins right now. Goods morning and welcome back to squawk box here on cnbc im joe kernen along with becky quick. The former president of the nyse and cnbc contributor is here and be our guest host is Michael Reuben, executive chairman of fanatics its great to have you we have so many things to talk about. Love it when youre here. Always fun to be here. Sales, just overall for nfl stuff. Up how much this year . Up in the 20s theyve been great weve tried to grapple with figuring this out. Listen, youve seen every metric in the nfl up. Im leading to draft kings and fan duel we can do that. Lead away you just said 40 whats up 40 . The Online Business of nfl is up 40 . Wait a second is that because of the deal with walmart. Com or is that just because so fanatics this weekend, so far its up 126 . Weve been up 26 from thursday to sunday. The two leaders have been nfl and ncaa theyre up 40 its been crushing it. And i think in general a lot of metrics that people are worried about in sports, you know, how individual tv ratings have been able to bounce back strongly, for me, the best barometer is how strongly sports are doing is merchandise sales. Its not worrying is someone consuming media on tv. I think a lot of it is what youre doing particularly at fanatics moves that youve made that outreflect sports i agree 100 . I think if you look at whats the licensed sports market overall. Right probably growing 3 to 5 when as a company were going from 2. 5 billion to 3. 2 billion. Is that businesses himself . Hes not going to disagree with it. I think it is i agree with you, becky. Its just because he signed be a deal with walmart. Com and that gives him greater distribution. Push back i like to disagree with you push back. Becky by nature, more thought full. Thank you, michael. Licensed sports overall as a category is up 3 to 5 . Youre up way more. Online is taking more share than offline when we look at this past weekend up 26 as a company, thats incredible sales. Were getting maybe all of the growth and maybe some share gains as well. And is most of that jerseys you know, i was just looking. I was curious. So jerseys are the number one category number two product this weekend, new Orleans Saints nfc championship tshirts. Didnt think that one would sneak in there number 3 was the Dallas Cowboys salute to hoodie new England Patriots holiday pajama set number five, big logo slippers and last but not least, no one would get this one, the Washington Nationals locker room tshirts when you win the world series in the beginning of november, that carries over to christmas. Buying it for christmas yeah. Yeah jerseys the biggest category, 35 of our business. Lots of things that we 1esell whats incredible, black friday was the biggest day in the countrys history. Bigger than last years cyber monday generally speaking black friday in the new year can never beat the previous cyber monday. We have people standing around that want to talk retail. They want me to come back to you. Then i want to talk to you about Something Else. Then we can disagree. No, i dont think well disagree about how the if you can put just a small amount of wager on a game, i am glued to the tv set i landed yesterday and it was i think 4 10 and the game started at 4 25 and i couldnt bet because i was not in new jersey before that. I had like 12 minutes to get some bets. Youre an addict. On those two 4 25 games which i won. Which games i took denver and they won and i also took kansas city and they won i had 12 minutes my thing still wasnt saying i was in new jersey. You were over new jersey air space. No, that wouldnt work because i didnt anyway, but and then i watched both games. I couldnt watch the other one but im glued to it. Its great for the ratings. Youve seen me say this consistently for three or four years. Number one, i think every decade theres a company in sports that kind of is the special company of the decade. I think were fortunate to have been that company the last decade i think fanatics has created an incredible business out of what was an archaic and not exciting business i think sports gamble is the next business. Its not just about the money thats going to be made in sports gambling because i think thats great its big. Its the engagement its going to be people like you are addicted. Addicted is a strong word. Were going to work to get your nbc paychecks to go i started with 500 and its still four months im at 480. How many replenishments. Hes playing with the same pot. I do it because he tells me every move hes completely addicted is he still awake when he does the show. Before i went down to georgia on wednesday i made all of my bets forthursday, friday, saturday, sunday. Youre making your case for your not being an addict. Then i knew i would be back by 4 so i didnt bet the key take away, what weve been saying for years, as Sports Betting becomes legal, regulated its going to be great for the Sports Industry, not because of the dollars generated but because of engagement. Thats why we see ratings this year. The nfls ratings are spectacular. I think theyre up 5 or 6 this year up against a big gain. See, this is going to be good as weve been talking, out of turn really, retails front and center this morning. Cnbc has full coverage of the sector kate still might be there. She might have left. Kate rogers focusing on Small Business thanks for hanging around, kate. Lets begin with Courtney Ragan at the walmart Fulfillment Center maybe you want to join draft kings with me. Ill give you my picks i dont know. Reporter you know what, also michael forgot to mention that ohio state was the number one college team over the weekend at fanatics a stat i didnt hear him say i am here at the walmart distribution center. This is one of six of these Fulfillment Centers. Theyre going to be fulfilling those online orders. Its 1. 2 million square feet there are 12 miles of conveyors. From the time you place an order from the time that item is picked, packed, shipped out, it can be done in just about an hour the National Retail federation suggests 69 million americans will shop. Adobe says well break more records today. We did it on thanksgiving, we did it on black friday, today on cyber monday it is expected 9. 4 billion will be spent online which will be a new record not just for this day but ever in the United States. Interestingly though, the peak sales volume will not be until much later tonight, between 7 and 11 p. M. Pacific time so that also means around 10 00 on the east coast you dont have to go to work anymore to get that high Speed Internet we have it on our phones all the time now deliver is a company that helps Third Party Merchants fulfill their orders Third Party Merchants that sell on walmart, ebay, shopify. They said their black friday volume was 3. 7 times a normal typical recent friday, but that compares to last black friday that was three times so much stronger than even last year shopify says on black friday they sold over 900 million worth of items across the platform thats a lot of small and medium businesses and those sales were up about 48 in the u. S so winners all around here well see what happens on this cyber monday im going to send it over to kate rogers for more on Small Business hi, kate. Reporter hey, court. Small Business Sentiment is on the rise heading into 2019 take a look at this. Overall confidence rose 2 points to 59 bouncing back from lows not seen in two years in our survey right now only 9 of Small Business owners say that they describe their Business Conditions as bad while more than half say that Current Conditions are good. Theyre planning on increases in both revenue and head count heading into 2020. The boost in this quarter, thats due to increased optimism around trade one quarter saying that they expect the trade policies will have a positive impact on business thats the highest number in two years. Nearly half also say they believe that technological changes like 5g will improve the Business Conditions moving forward. Despite this increased optimism finding Skilled Labor we all know is a major challenge for Small Businesses 1 5 say they have Unfilled Positions that have been open for at least three months. Thats an increase of 2 from this time last year. In order to attract or retain workers in this tight labor market, Small Business owners are telling us that theyre doing things like raising pay, increasing the types of benefits offered and even doing more Creative Things like paying off student debt for their workers, becky. Back over to you. Kate, thank you very much who better to talk retail this cyber monday than our guest host Michael Reuben hes the executive chairman of fanatics we didnt get into guilt very much. Guilt was up 40 , nearly 40 this week and its been terrific Overall Company has been performing really well overall, if you want to talk about ecommerce, we used to think of black friday as a brick and mortar holiday, cyber monday as the ecommerce holiday its now like cyber weekend. Thats really where this is. Everything is about ecommerce is the most important channel. What kind of discounts ordeals did you offer to consumers over the black friday weekend . Weve always offered great value to consumers in all of our businesses it hasnt changed year over year the value this year over last year but you do offer discounts . Absolutely. If you dont offer discounts, you wont bring them on. They expect that no different than fast delivery the discounts dont change year to year. Id say our average tis count in the sports business is 25 to 30 . Its been that way for years thats what consumers expect thats where the market is we deliver great value along with Great Service and a brand that they really trust. You know what i also expect as a consumer is that the deals will not stop. That i will get them before thanksgiving, i will get them black friday, i will get them cyber monday i anticipate that im going to continue to get email offers from these cyber retailers. Youre 100 right heres whats a little bit tricky about this Holiday Season people havent figured out if you look at everyone in november everyones november sales as a month was awful, including ours. Because the thanksgiving weekend shifted into december. Right. We look at yesterday and today, two of the you know, the largest days being cyber monday of the year and sunday which is probably one of the top five days of the year, those are december days. And so you ran youre running really down as youre lousy counts for november but better ones for december. In order to look at this, what do you do in november and december thats the way we think about it i will say were up thanksgiving weekend to thanksgiving weekend 26 at fanatics which is a good sign the other thing you have happening this retail season is because thanksgiving was so late its going to compress the number of days by six fewer calendar days between thanksgiving and christmas thats a big deal for brick and mortar business but im guessing its a bigger teal for shipping. It is because Online Shopping generally ends around the 19th or 20th. Brick and mortar ends the 24th generally theres a lull after the cyber five weekend there wont be a lull this year. Tuesdays going to be right back at it, wednesday right back at it you have big gains you need to be running up 20, 25 every day to make up for the shorter days. It means im right to think ill keep getting cyber deals. What is walmart doing around expectations on shipping amazon stock has been flat one of the reasons is theyve gn to single day shipping, same day shipping when i go to order a jersey, i have a closet full. Thank you i like a closet full the closet is joe betting 20 a game. I did 40 last night 40 a game its a progressive disease, thats why im worried. Perfect we need to move from the closet to the house. I the baseball jersey, youve done it, i want it tomorrow because amazon has moved my expectations. Are you seeing that in your business couple things one, theres no question in ecommerce amazon is the Gold Standard when it comes to speed of delivery. They have raised the bar for everybody to say if youre going to buy, we expect to get the merchandise in what used to be two days, now in one day what theyre doing is forcing everyone to be smarter, more thought full the best retailers are saying theyre going to use their stores to become distribution centers. Theyre saying, look, we have an inherent advantage how do we leverage our stores to do the delivery. How are you going to do that . For us, a couple of things. Number one, i believe firmly that amazon and alibaba are killing everybody, okay . If you dont have something thats completely differentiated, youre dead. I believe that since i sold my last company in 2011 to ebay, i thought that five years before that you have no chance to sell to in other words, they were the suckers on that end . No, i dont think you bought back everything they wanted. They bought the company for a great reason they wanted to make it more competitive with amazon. We need all of these big brands that gsi operates with, ralph lauren, et cetera into the marketplace. My point is youre in a world where amazon and alibaba are killing everyone the only way to win, to be completely differentiated. For us at fanatics we basically sell exclusive product half the merchandise that we sell we design, develop, manufacture. You think of h m, lululemon. Vertical company 2 when i bought the company back in 2011 its now over 50 . The other products are exclusive products you cant find on other online marketplaces. Without that excludes sift and differentiation, we would be dead thats why fanatics has been so successful i give credit to jeff bezos and amazon if i wasnt so scared of them so long i wouldnt have made our business so differentiated so as you look out long term, whos going to win online . Yes, speed of delivery is really important. Id say the most important thing is to have youre not going to beat amazon at speed of delivery you have to have a differentiated product if you dont have that, youre going to be dead a company like lululemon is doing so well. Thats why you see fanatics with i. P. That we have doing so well. Michael is our guest host hes going to be with us for the rest of the hour. Coming up, 125 million americans are now in the path of a major winter storm the risk to travel is straight ahead. First, check out the futures right now they have moderated a little up about 75 on the dow, 19 on the nasdaq s p indicated up just under 8. Stay tuned, youre watching squawk box on cnbc when you retire will you or will you just be you, without the constraints of a full time job . You can grow your Retirement Savings with pacific life and create the future thats most meaningful to you. Which means you can retire, without retiring from life. Having the flexibility to retire on your terms. Thats the power of pacific. Ask your financial professional about pacific life today. What are you doing back there, junior . Since were obviously lost, im rescheduling my Xfinity Customer Service appointment. Ah, relax. I got this. Which gps are you using anyway . A Little Something called instinct. Been using it for years. Yeah, thats what im afraid of. He knows exactly where were going. My whole body is a compass. Oh boy. The my account app makes todays Xfinity Customer Service simple, easy, awesome. Not my thing. All right. Welcome back, everybody. Heres whats making headlines at this hour President Trump is reimposing tariffs on steel and aluminum imports from brazil. The president announced it this morning. He said the two companies have been engineering a massive evaluation of their currencies making it harder for American Companies and farmers to export their goods. Fiat chrysler has reached a tentative contract with the United Auto Workers association. That has been subject to ratification it comes as they are getting a deal with the pugot psa group. And macao casino revenue is dropping 8. 5 in november. Heavy snows in the United States canceled more than 1,000 flights since yesterday. There were quite a few yesterday as well, delayed thousands more. The Winter Weather turned the busiest travel day of the year into a nightmare so far today more than 450 flights have been delayed, more than 180 canceled. Amazing that Michael Reuben was able to get in here. This storm is expected to dump a foot of snow into the boston metro area by this morning and right back at him im starting it off with a kill. Weve got another 40 minutes to kill. How long were you in the tsa line dont even ill just be quiet. Its an easy commute to get here guys like scott, not being sympathetic, he you dont have a hard commute. Listen, you were betting on sports times they brought freezing rain im jonesing right now. It brought freezing rain overnight stretching from the great lakes to the northeast i did look at ncaa today, basketball, i dont know, today, i may do that. Thats because you have more football. Im going to do i cant bet on kirk cousins, i cant. Could you go a week without. A week without . I told you did you hear what i said when i was down there you bet in advance. I prebet. The answer is no. He needs action all the time right right. I dont need it all the time. Its fun its an enhancement to life your life experience. Could you give it up for lint that falls during march madness. I gave up giving up things for lent. Well introduce you to Stock Exchange for things and talk about the holiday and retail for consumer a reminder, everybody, make sure you subscribe to our squawk podcast. Its called squawk pod for more on this you can look for us on apple podcasts or on your favorite podcast app. Stay tuned, were back in a minute vo the moth without hope, struggles in the spiders web. With every attempt to free itself, it only becomes more entangled. Unaware that an exhilarating escape is just within reach. Defy the laws of human nature. At the season of audi sales event. Cyber monday is underway some online brands betting on brick and mortar even though revenue is coming in online. Joining us with more on that strategy is scott cutler, the Stock Exchange of things and Michael Reuben, executive chairman of fanatics multichannel. Were not going away explain this new strategy. The new strategy is not new you have a shift in buying behavior going from offline to online thats a general ecommerce trend. Were playing with a more meta level. More online and having the ability to buy things that arent available anywhere else stock market of things, sneakers, street wear, collectibles thats where were playing into this broad trend of Consumer Behavior if i go to a cocktail party, do a meta something no. Just one level above which is, you know, people want access to things that you cant find anywhere else and stockx provides that opportunity particularly in categories like sneakers as we talked about before, street wear, and, you know, things that you cant get in any other retail location michaels one of the biggest customers. Off whites. Theyre purple. Yeah, off white special. Came from stockx im definitely im a netanyahu custom new customer. Michaels one of the top customers. I want to get the Accurate Answer im good for 50 pairs in the last two years youre buying sneakers above retail hot sneakers i just got ten pair last week. Its funny the person who helped fund stockx in the beginning was dan gilbert. Dan gilbert as you know called me several times when you were starting the business, hey, michael, you should get involved in this. I was dead wrong i said, how big can this thing be its only the high end Sneaker Market one question i have for you knowing that when dan called me several times to get involved i didnt think it would be that big, youre already what a billion dollars plus yeah. Yeah. What categories are you in today or what categories will you be in . I think i completely missed how big it could be. When you look at the total size of the market this is the most interesting fact. 100 billion in just sneakers alone. 20 of that would be ecommerce and then the resale marketplace which we participate is half of ecommerce globally and growing at triple digit. Its been an amazing market opportunity. For us as we look at the category expansion, started with sneakers, followed with handbags and watches and then we launched street wear which quickly became our second category and then we launched collectibles. Then for us we Service Customers in 170 Different Countries and 25 much our business is outside the u. S. The International Opportunity for us is a really big one the thing ive wondered about the shoes, scott and i worked together at the Stock Exchange and scott brought in big marquis listings like alibaba, twitter, we focused a lot on the listings as opposed to focusing on the traders. Now youre at stockx are you focusing on the guys listing the shoes or are you focusing on the michaels who are actually buying the shoes . Within that, how concentrated is the Seller Community im guessing its pretty concentrated where you have a relatively few number of professionals who are selling and then the buyers are fragmented but thats just a guess. So we have tens of thousands of sellers from around the world so its largely a marketplace thats powered by sellers from the teenager Funding College to somebody who might run a professional business. When i look back at the stock market days when this company was founded, it was founded on the principles of new york Stock Exchange, stub hub and ebay, all places i had been at when we talk about the stock market of things, the interesting thing about the User Experience on stockx is we have the opportunity to bid and ask for that most sought after thing. So stock market like functionality but also similar to the exchange, its the place where you trade. So you dont know who youre buying a share of nike stock from, you dont really care, but there is a platform that matches a buyer to seller and we do that in a similar way in ecommerce. That was the idea behind the company. Scott, now that youve been doing this for a while, whats surprised you the most whats surprised me the most is obviously the global opportunity but then as were going into the Holiday Season, just the velocity of the transactions black friday, we were doing a transaction every second we were selling thousands of pairs of new releases that had just come out and so as we look at this new type of behavior thats coming into the market, and people want access to things they cant get, whether its experiences or goods, its been mind blowing in terms of the global reaction. Talk about nike and adidas. The way this used to work, nike or adidas would design a shoe, put it out for sale to foot locker are we going to come to a place where nike will use you as the retailer and the middleman gets cut out. Brands have to go omni channel like you said. The Distribution Channel is being disrupted massively. We do think that brands will come on the platform we did an ipo with adidas that listed the product directly on to stockx. Ipo, i like it. Ipo, initial Product Offering as more and more brands have to go direct to consumer because of that distribution disruption, the reality is they have to compete with every other tech company thats providing a great experience on a mobile platform and thats very, very difficult to do when tech is not in your core dna so thats a challenge for brands for the consumer the opportunity is to be able to buy something in retail and have the opportunity to resell it potentially and make money on a platform like ours where we provide that opportunity for a seller all right good thank you. Appreciate it. Weve got somewhere to go. More to come from michael. Also still to come on squawk box today, december is historically a great month for stocks it could be one big risk this year weve got the details right after this. Plus, political experts say that young voters could be the key to the 2020 election and this morning were getting new details on what this generation thinks about the wealth tax. Those findings when squawk box comes right back welcome back to squawk box, everybody. Weve been watching the futures this morning and right now it looks like we are indicated for a higher open. Dow futures up by 71 points. S p up by close to 8 nasdaq up by about 19. Joining us to talk more about the markets on this first trading day of december is joe zidel, hes the chief investment strategist of blackstone thanks for joining us. Thanks for having me. Markets have been off to the races running up, up, up you are a little concerned that things could be over bought here youre over weight in cash what worries you yes, we are sitting out we took our cash allocation up to 10 what were recognizing is liquidity on one side and fundamentals on the other. We have a 10year treasury yield starting off at 2. 4 its now down to 1. 83 or so. The fed cut three times. These preemptive cuts. Theyve restarted some form of quantitative easing. Thats on the liquidity side thats good for valuation. The fundamentals havent kept up were looking at an environment with slowing global growth, manufacturing recession and near were not looking at recession as clearly as it looked like we were a while ago. Are you getting a little frustrated as you watch the market continue to run with this getting serious i forgot to take these off my wife and kids tell me to take them off before i go on air. Sorry, guys. Where were you . I mean, ive been giving you grief for the entire way up. You were bullish. Yeah. Until do you remember the date yeah. Really it was late august, early september. It was as soon as we got the 8 to 10 yield curves. At 2800 yeah. Yeah that hurts. No, its a wall of worry. When would you say, all right, i missed 15 , im not going to miss anymore . Do you just go somewhere else and start over or what how do you get rid of that . Do you ever capitulate and say, i was wrong . Well, theres two dynamics, right . Theres the Interest Rates and the fundamentals i think the challenge for me when i look at the valuation in the market, we have fundamentals that havent kept pace. If you continue to be wrong, thats what youve been saying if that continues to be wrong, when do you say, okay, im buying at 31. 50 . I think the key for the next six months is whether or not we can get some sort of resolution for trade because that would help instill confidence. Then you buy at 3200 after being at 2800 . Think about the role of ceo confidence here. Think about how that impacts everything from capx to hiring decisions, how its going to impact sales. I was wondering what you were going to do. I want to ask about you you mentioned global growth. When i look around the world, global valuations arent particularly high. Your pe is like 13, 12. 5, 13 it feels like thats already priced in. There may be further up side in stock prices all around the world. Yeah. I mean, i think there could be and its because, you know, youve got like elections in germany that are ushering the prospects of sort of fiscal policy, some sort of fiscal stimul stimulus, which is a lot of liquidity. Global debt has surpassed 250 trillion its 86 billion per capita. You have a lot of liquidity. Germany. You mentioned germany. Germany, france, italy, the three big in europe. The three combined 5 billion euros to gdp growth but over 5 billion euros to the market cap in their respective indices. You have all of this liquidity it can probably push them up higher does that mean were in a good spot fundamentally its pushing 20 times. If youre trailing cash 20 times earnings, your times forward are below average. The ten year rate wasnt at 1. 83. How much lower is a ten year going to go . I think its an open question. Weve gotten information from the fed that theyre on hold unless they get some other material reassessed for the economy. You have them expanding the Balance Sheet. How many more tools do they have left to push down the ten year or push down rates in general. We have a secular low in the ten year my guess is the next move is going to be a little bit higher. I think that will challenge efficiency the key to all of this, joe, your point about missing out the last leg of the rally. We dont know it might not be the last leg may continue to go i was wondering what it could. The big x factor is whether or not we can ease these trade tensions what we know is weve done damage to the real economy they havent hit the financial markets, but when you look underneath the hood, youve got equities that are roaring but if you look at ccc credit which is below investment grade, when you look at ccc credit, very economic weve seen the spreads between the high yield bonds and treasuries are wider than they were corporate for 2018. Well watch playing this out thank you, joe. Coming up, guest host Michael Reuben on the intersection of sports, retail and gambling no, big business squawk box will be right back. Little gambling. Yeah. Still to come, some new details on taxingwealth and what young voters think about it robert frank joins us with that story. Hi, robert good morning, becky a majority under 30 say the wealthy didnt earn their wealth and theyre a threat to democracy. How theyre driving calls to tax the rich and what it could mean aerhereomg and markets cin upft t bak i can shine, i can shine, i can shine. Imma do what im made to do. Built for excellence. You start from the foundation up. The excellence is reaching dreams and chasing them at the same time. The excellence is reaching dreams and here, it all starts withello hi . How can i help . A data plan for everyone. Everyone . Everyone. Lets send to everyone wifi up there . Uhh. Sure, why not . Howd he get out . a camera might figure it out. That was easy glad i could help. At xfinity, were here to make life simple. Easy. Awesome. So come ask, shop, discover at your local xfinity store today. Welcome back to squawk box. Were now 11 months from the 2020 election and as democratic president ial hopefuls keep attacking billionaires and talking about taxing wealth, pollsters are trying to understand Younger Voters and what they want robert frank joins us now with that story hey, robert. Good morning, joe the split over taxing wealth is mainly being driven by age Younger Voters who say billionaires did not he were their wealth and are a threat to democracy. Kato poll found that a majority of voters under 20 said the rich made their money by, quote, taking advantage of others rather than earning it Younger Voters are three times as likely to say its immoral for society to allow people to become billionaires. More than 1 3 say its sometimes justified for citizens to take violent action against the rich. Younger voters are far more supportive of redistributing wealth and taxing the wealthy. A majority support the government taking money for the rich for the poor compared with 20 of older voters. More of them support a top tax rate of 70 . The question is whether this is particular to this generation or whether people in their teens or 20s have always opposed large wealth in 1978 a majority of people under 30 also said the income gap between the rich and poor should be reduced by raising taxes on the wealthy the age gap explains why Elizabeth Warren and Bernie Sanders are getting a lot of strong support from Younger Voters while biden and the more moderate candidates are attracting the older voters. There was a poll over the weekend that showed 63 of all voters support a wealth tax. 2 of those over 50 million. That the only subgroup that did not support it are College Educated republican men. That was the only demo that doesnt support a wealth tax. Can you go back to the using violence against them statistic . What was that . 40 say it is sometimes justified to take action against the wealthy by violence. How many people were polled in this . About it was over close to 2,000. Thats nuts. Statistically significant yeah, it was disturbing. Yeah, its disturbing. Doing good today. Sneak out the back door, michael. Looking at you. You know whats funny, im thinking about this, i was thinking about it last night i actually think the way the country works in a lot of ways is great americas a country where you can come, you can be a entrepreneur, you can create great value. I dont think you ever want to deter that from happening because this is a place where so many great businesses get created and started. What i do think has to happen is there has to be more pressure on entrepreneurs when they create great value to give back i always bank on an entrepreneur to give back and get Great Results versus giving that same money to the government. For me, i always just gave money away, i didnt care about anything until what happened to my friend a few years ago. We put 50 million into changing the probation parole system. With the group that we have and the 50 34 50 million, i think we going to make a lot more progress than the government can make with many more times that money. There is a responsibility to give back in a meaningful way. Id much rather bet on the entrepreneur who made the money to figure out how to invest and innovate on areas of the country they want to fix versus giving it to the government when it becomes very ineffective. Lets bring in a couple of other voices former u. S. Center is here and maddie duffler how do you navigate your party, the Democratic Party, when you hear statistics like this . I think a couple things, becky. First, whats the old saying if youre not liberal when youre young, you dont have a heart but if youre not more conservative when youre older, you dont have a head. Young people as they have experience being entrepreneurs seeing how they create businesses and opportunities will learn. Is that the democratic version . A little more conservative if you feel better with that, saying it that way, thats okay. A couple of other things. For our countrys sake, its a good thing the United States senate is a little older demographic. The older age is 64. The wealth tax is not going to go anywhere. There are some legitimate things we need to focus on. So many young people come out of school with huge amounts of debt that may color their views about things we need to find a way to make access to Higher Education more affordable so thats not going on with the huge disparities in wealth, we need to convince young people, i hope so, even in my party, joe, to lift up rather than level down. I get confused who your party is youre an indiana democrat you dont recognize this party. Ive been accused of being a republicrat. The truth is somewhere in the middle we do need to focus on how to create opportunity in our society and i would encourage young people to look at some western european societies and elsewhere where the youth rate is 20, 30, 35 thats not a place where we want to go. How do we harness markets and entrepreneurs in ways that more people can participate in rather than emphasizing jealousy, envy, taking from people who have been successful both parties want exactly what you have just said. The question is does the government take somebody like michaels wealth and redistribute it . I think bill gates, probably the most consequential person in the history of the world with respect to philanthropic monies, if the government had taken that, would it have had the great impact no. If the government had taken michaels wealth, would the government have had the social justice impact that michaels been able to have . Its not what the desires are. We all want happiness for the greatest number of people. Im just curious, do you think the Elizabeth Warren, Bernie Sanders way of achieving that is the right way for the country . And will it fly in states bordering indiana . Thats what really matters, michigan, ohio not ohio, michigan, principally wisconsin, so on. You wont be surprised to learn that im not in the Bernie Elizabeth camp. Im not for marginal tax rates of 70, 80 im not for confiscating peoples wealth if they have been successful. There is a legitimate debate about how progressive the tax rate is and how we go about generating the income for opportunity for those who are not as successful as the most successful in our society. How equitably to do that thats a legitimate debate im not for confiscating peoples wealth for the wealth tax. Im not for the socalled death tax but paying more along the way to try to fund good things heres the key where im from, joe, out in the hinterland, beckys home state, people are for funding education, they know inherently government is not subject to a market discipline. Government tends to be inefficient. It can be wasteful so how do we hold government accountable, thats the key word, accountable towards taking those tax dollars and spending them, investing them in ways that produce results that taxpayers want . Thats the key markets tend to have disproportionate outcomes. Government tends to be wasteful. How do we find that sweet spot in the middle . Maddie, youve been waiting patiently. Do you want to weigh in . I sure do the debate happening around the table is not the debate happening in the democratic primary. Whats happening when you talk about wealth taxes is a conversation about what kind of government we think we should have the fact of the matter is when you come to socialism and capitalism, the kato poll, young people think favorably about socialism the same way they think favorably about capitalism whats not surprising is young people are in favor of taxing people who they dont think are them theres this other effect that we always see in the polls when it comes to taxing people. Even Bernie Sanders, wanted to tax millionaires before he bill a millionaire. Now his wealth tax kicks in at 32 million theres a reason for that. Its because theres always support when you think someone else is the one paying the bill. The conversation about entrepreneurship is particularly instructive here americans now, particularly Young Americans who make up the largest part of the American Work force are people who came of age during the Great Recession and that was an extremely formative experience that has in some senses set them back. So you dont think they grow out of it, in other words . Well, i do think they grow out of it but i think they have a unique perspective that our political and financial thinking hasnt been accommodative. There are ten years where they think their future financials have been accommodated as a result of that, millennials are a lot more entrepreneurial which means business taxes are going to hit them a lot mover sense more sensitively theyll be exposed to business taxes. When you talk about taxes on wealth, when you talk about taxes on high income earners, people think thats just on the income side of things. When you think about the complexity in business taxes, thats something that young people will be a lot more exposed to a lot earlier than a lot of other generations. Mattie, good to see you evan, thank you. Great to be back. Its a discussion well continue. It is we have a lot to continue with Michael Reuben, thank you. Our guest host for the hour. Came in did your dad ever have any money i came from a very middle class money, 42,000 house. Where does that come from that billionaires i dont understand thats just a perception. Ive got to tell you, one closing thought. When i think about people starting companies, if you took 3 of their stock as a private Company Every year, no ones going to Start Companies here. Theyre going to go to other countries. Thats bad you want innovation happening here you, i dont know who you are. I mean, you come in here with as a democrat and you just you fail miserably. Im a former governor, joe. You failed miserably. When youre a governor, things have to work. Joes the guy gambling. He has the last word. 6 seconds left. Michael rubin, coming up. Thanks, robert. Wall street ready to kick off the final trading month. Big stocks to watch next siren blaring Police Officer excuse me, sir. Sit tight. Yep, sit real tight, speedy. Cause youve got to call it in, Police Officer radio to dispatch. Type it up, hey, dispa. feedback ringing deal with that, dispatch. Write it up, walk it back, Police Officer slow down out there. And call hqagain. sigh siren blaring this isnt working. Introducing Samsung Mobile First Responder solutions. With the galaxy note10, you can get Realtime Data at the scene, all on one device. Samsung business solutions. Get ready to spend shoppers head online for cyber monday with billions of dollars on the line after a record black friday boeings big december. Its a crucial month for the plane maker as it tries to get the 737 max ready to fly before 2020 begins. And can a billionaire really win the democratic nomination for president . Michael bloombergs Senior Campaign advisor will tell us why he thinks the answer is yes as the final hour of squawk box begins right now. Good morning welcome back to squawk box here on cnbc live from the Nasdaq Market site in times square. Im joe kernen along with becky quick. You see whats going on . I know. The snow is back. Tom farley, ceo of far point and cnbc contributor it was raining now i see some looks like a wintry mix. It looks slippery. Getting colder. Thats the plan. Wintry mix. It kind of feels holiday like. You dont have to rely on a plane, a train, a bus. Stay back in front of the fire. U. S. Equity futures this hour, we were up triple digits we are up 60 and change on the dow. S p up 8 or so nasdaq up 17 treasury yields, i saw 184, 185, somewhere around there on the 10 year, 183 now. Here are some of the stories that investors will be talking about today. It is cyber monday adobe forecasts that today is going to be the biggest ever for ecommerce with 9. 4 billion spent estimated. If thats the case, thats up 19 from cyber monday last year. The spending spree comes after a lucrative black friday for the retailers. Although foot traffic appeared to be lighter at malls across the country. Adobe says online spending on friday hit a record 5. 4 billion and thats up 22 from a year ago. Heavy snows in the United States have canceled more than 1,000 flights since yesterday and delayed thousands more so far today more than 450 flights have already been delayed and more than 180 canceled bostons metro area is expected to get a foot of snow by the end of the morning and disneys frozen 2 set a thanksgiving holiday record by taking in 124 million in north american ticket sales. That broke the previous record set back in 2013 by the hunger games catching fire. Take a look at shares of disney have been up, up, up not because of blockbusters but because of the disney plus success. It is the start of a big month for boeing, which is obviously a very important dow component. Our largest manufacturer the plane maker still thinks it can get the grounded 737 max certified to fly before the end of 2019 and maybe even deliver some of the planes to its customers this week. Pilots are heading into the 737 max simulators the company want to know how theyre handling the redesigned mcas software. Joining us what did we decide, ep stein. Steen, right . What do you say theres two different parts of your family. What do you say . I guess i say steen. Research analyst at bank of America Merrill lynch. Is this can we start its december 2nd can we look at the chronology of how its going to happen with 90 certainty or is there still a lot up in the air, so to speak . Theres still some stuff up in the air boeing put out a press release i guess it was about a month ago there was five steps that they had to go through. They had completed one of those steps. Probably the biggest step that they have to go through, the biggest hurdle, if you will, is a joint operational evaluation board. Theyre going to review the Pilot Training and the Pilot Training theyll review it. It involves International Regulators so to some extent youre herding kittens theyll come up with a report and it has a public review period it looks like getting all of this done before the end of the year is a really, really, really long play. There have been some data points on orders that is gratifying on people who like the positive story on boeing is that where you are . The air show, the orders airbus has made some strides as well, but boeing didnt fall off the earth. Yeah. I wouldnt expect them to. Theres really only two producers of large commercial jets in the world, boeing and airbus right not everybody is buy everything from airbus i think we have to see as, you know, consumers start to fly again, their preference for plane. My guess is ultimately this too shall pass but its an open question, right . Boeing is hosting a meeting out in seattle with social media influencers, theres some bloggers, other folks i think trying to gain support for the aircraft its an open important question. No name change, right no name change as of yet, right . How many flights total in the u. S. Did the max have before all of the problems . It has flown thousands and thousands of flights, right . Yeah. Yeah yeah, for sure. Without incident. In the in the north american theres 60 planes. Do you think people eventually walk right on and dont even ask what kind of plane it is . Were not here yet. If you look at whats in cases that have happened in the past, thats typically what happens. I had that same question. Ralph nader came on this network. He has a personal and tragic connection he came on the show with us, he effectively said, im paraphrasing, this plane was not built to fly safely. Yeah. Its not a software issue, its actually a structural problem. So, number one, could that be the case number two, if its not the case, doesnt that sort of verbiage scare potential flyers for quite a while . So two things to discuss here in the first case, from everything we know actually know, the 737 is the design of the airplane, its a low wing airplane with low hung engines, very stable design its an airplane, however, that a flawed system was put into on that piece, hes right. Once you fix that, its okay the second piece, this is a world of social media. This is the longest grounding. We really dont have a precedent for how the flying public is going to react to the plane. Nader thinks the flawed system went in because they moved the engines for more fuel efficiency and disrupted the stability of the structure of the plane, not just in his view, not just a failed system you dont buy that ive got a ph. D. In aerospace. I used to design wings for a living and what they did do is by moving the engines, the airplane doesnt feel like a 737 mg, it feels like a different plane. They put the system in to make it feel we shouldnt think theres an inherent instability in the new structure. That would make no sense, right . But does it make sense that it would feel like a different plane . Of course. This becomes an important financial point. Part of the selling point of the airplane was no training if youre southwest airlines, this has to feel like a previous generation so a pilot can walk up and fly either plane. If this didnt have this system, that wouldnt be the case, right . So thats thats the key thing. And there was you know, to be clear, there were mistakes made on this system. Theres been a chorus of voices, minority of voices saying they need to do away with the mcas system entirely, start from scratch i have some experience, i had a terrible outage at the new york Stock Exchange we found trying to fix the problem was harder than just ripping it out and starting certain parts from scratch should they be doing that . The canadian Regulatory Authority said get rid of the mcas thing and recertify the plane as a different thing from my point of view, that could be a valid point of view a little more training and more complicated. Six months, eight months, nine months of the year . That could be another path to go down. Absolutely theres a view that the airplane somehow is very fundamental and flawed, that doesnt make sense. Are we going to watch globally how this is reintroduced whats most important . Yeah, right its a global action, right . The faa, you have europe, the chinese authority, canadian authority. Everybody has their own authority. Our expectation is that the airplane will go backinto service in march in the u. S. First and then the europeans and then the chinese will probably follow that. Probably, assuming theres a trade deal, right . Probably . Right. However, i would add, you know, this kind of slipped under the market, the chinese approved boeings deal to buy ember air and china approved that, right so i dont know how much of a quid pro quo was really going on on that front, but so what i guess im trying to say, you could get approval by the chinese authority. That doesnt necessarily mean theyll buy more planes. A deal to buy planes would be tied to a trade deal safety may or may not be. Ron, thank you. Ph. D. In Aerospace Engineering and he worked at boeing as an Aerospace Engineer so engineering engineering thank you thanks. Hard work when we come back, well take an inside look at the ameritrade deal from one of the most knowledgeable voices on wall street. Plus, up ending the ipo process. Can the evolution of the direct listing and the departments we could see next year. Stay tuned, youre watching squawk boxig he cc. Rhteronnb when it comes to your customers expectations, theres one thing you can be sure of. Theyre changing by the nanosecond. Thats why cognizant created a unique engineering approach to design and build new digital products. Learn how cognizant softvision designs experiences and engineers outcomes. Cool. What are you doing back there, junior . Since were obviously lost, im rescheduling my Xfinity Customer Service appointment. Ah, relax. I got this. Which gps are you using anyway . A Little Something called instinct. Been using it for years. Yeah, thats what im afraid of. He knows exactly where were going. My whole body is a compass. Oh boy. The my account app makes todays Xfinity Customer Service simple, easy, awesome. Not my thing. Welcome back to squawk box. Check out the futures up 64 points now on the dow. The nasdaq indicated up 16 s p up 7 and change. Last week we got the official news that Charles Schwab is buying rival t. D. Ameritrade in a 26 billion deal its a move with far reaching implications for the brokerage industry joining us is rich ripetta this was not the deal most people were expecting as you pointed out but it will massively change the industry. What do you think . Yeah, it creates tremendous scale. Theyre going to have 5 trillion in assets. The advisor space will have 15,000 advisers and in a space where commissions have gone to zero, i mean, you really need that scale and consolidation where you get the maximum scale, maximum efficiency. This industry is undergoing so much change and turmoil because of going to zero commissions but do you think there will be regulatory concerns on this because of the ria, investment advisers. Thats been discussed, a lot discussed. Just as exchanges consolidated years back, it really depends on how you define the market. If you look at the rias of the ebrokerage, yeah, schwab is going to be half of that if you look at rias of banks, insurance companies, the other independents, really about 10 so, again, its what the regulators and antitrust officials look at for the market schwab, when you look at advisers overall, any of these advisers could come and talk to you, again, theyre 10 of that market. What are you hearing from that ria channel, the ebrokerage ria channel. Are they running to washington saying, you need to dq this deal they obviously are concerned but theyve been through, you know, deals before schwabs doing a lot of talking to them, so is ameritrade. They have good relationships with the existing advisers so thats something that, you know, you want to just like you win over clients, you want to win over the rias that you have, make sure theyre on board as well. What do you think the next step is . How will this industry move from here because of this well, theres still one player still out there, etrade etrade, you know, they didnt get involved in this deal. Its interesting that they were not involved but theres still value. They have a bank they have deposits they are able to raise deposits. Theres a lot of companies out there, a lot of big banks looking for deposits they have a corporate stock plan business etrade, still in my opinion a valuable asset but they have been you know, theyre going to lack scale compared to schwab and ameritrade. Is there potential for unconventional tie ups, like a coin base in an etrade or sofi and etrade as opposed to one of the banks you just said. I would say anything is possible as becky said zero commissions opened up the door schwab you wouldnt have thought of that. T. D. Bank wasnt looked at one as one that would favor that transaction. They did so i think theres going to be a lot of out of the box thinking they have etrade has clients. They have 600 billion in assets so its really how you monetize the assets now theyre not going to be as big as schwab and ameritrade which have 5 trillion, but they still are have a Good Platform and, again, have a bank in the corporate stock land. What do schwab and t. D. Ameritrade have to do to make this a successful merger between the two . What has to happen next . We already talked about they have to win over the rias, make sure theyre satisfied thats a key thats a growing part of the business thats how you bring in new assets is into the rias. The next is really the cost savings. Just like an exchange a lot of fixed costs. A lot of fixed costs. In fact, 60 to 65 of ameritrades costs are expected to come out of the transaction how you well, that is a thats a lot. That is a huge number how many employees do they have . Combined theres probably around 30,000 employees. Thats combined companies. But, you know, when you look at deals in this space, this is what makes them so compelling is that when you bring the platforms together, an ameritrade platform and a schwab platform, a year later they slowly will make the websites look the same so when they do kill one platform there isnt a whole lot of disruption on the clients. Do you think that can happen in a year . Only because both of them are pretty successful platforms in their own right. So a year has been the typical time theyve forecasted or guided to a longer term. This is a little bit different than the exchange consolidation. It took a while but you got them on one platform. Now youre dealing with retail clients. A lot of the customer facing things that i think that you guys did at i. C. E. Were hitten behind the scenes. Here its very visible here you have a customer going on, hes used to better not change it or youre going to tick him off. Right rich, you know the exchanges very well. Direct listings is something i was involved with at the new york Stock Exchange. It seems to have momentum. What is your experience with direct listings and raising capital through direct listing and disrupting the traditional ipo model . Yeah, i do. I think with everything going on in the space, the debate between Companies Staying Private longer, private equity actually contracting here, i think, again, theyre going to look at other ways to raise money, whatever is easiest, whatever facilitates, you know, their goals and their objectives i know you were very good at doing that and look at the particular company, meaning what was best suited for them i think thats the model thats going to go you know, will win outgoing forward. Rich, thanks for coming in today. Good to be here. Good to see you here. Whats your prediction on army navy. I have to say go army we havent had a great year. Its a big game. We still get up for that game. Its the biggest of the year for us. Whats the spread i think navy will be favored because we havent had the year we had last year okay. Ill look at that. A couple weeks yeah. December 14th. Maybe began ohio state is good. Duh. Michigan was doing much better see what happened with that defensive end, dematha kid, chase young. The heisman guy. That guy is amazing. I know. I know i know that was a mistake coming up, Mark Zuckerberg doubles down on his companys controversial position on political ads. Well bring you new comments from the facebook ceo. And can a billionaire really win the democratic nomination . Michael bloomberg, his Senior Campaign advisor, tim obrien, will lay out his candidates case in a few minutes. Stay ted, u wchg unyoreatin squawk box on cnbc welcome back to squawk box. Dow futures indicated up 48 points nasdaq up 9 points and s p up 5. 5. Last week you saw a down day on friday but still for the month of november it was the best weve seen for stock markets since june and when we return it was a big weekend for the box office, but how much did netflix rain on hollywoods parade next, Michael Bloomberg Senior Campaign advisor tim obrien will be our special guest right here on set. Well talk about the former new york city mayors chances in the 2020 primary when cnbc continues. 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. Johnsbut were also a cancer fighting, hiv controlling, joint replacing, and depression relieving company. From the day youre born we never stop taking care of you. Welcome back to squawk box here on cnbc we are live from the Nasdaq Market site in times square. Here are some stories investors will be talking about. General electric has a date with investors. Ges Health Care Unit will be holding an investor day to highlight one of the best performing divisions last year the unit accounted for 16 of overall revenue but it made up 36 of operating profit for ge. U. S. Manufacturing sector will be getting some attention today. They will release the Manufacturing Index for november its expected to rise from 49. 4 from 48. 3. That would still be below the 50 mark that separates expansion from contraction. The u. S. Is seeking the extradition of Michael Lynch he faces securities fraud, wire fraud and conspiracy in connection with the sale of autonomy to hewlettpackard for 1. 2 billion in 2011 a year later they took an 8. 8 billion writedown. Lynch denies that saying hp mismanaged the company after acquiring it. Mark zuckerberg is standing by his decision not to take down political ads that include false information. What i believe is that in a democracy its really important that people can see for themselves what politicians are saying so they can make their own judgments and, you know, i dont think that a private company should be censoring politicians or news. A small group of facebook employees have written a letter calling on the company to reconsider and take down political ads that are in questi question ive watched them. Im behind him im not always behind zuckerberg but i am in that case. Stay strong. Former new york city mayor Michael Bloombergs campaign is starting to heat up. Hes pouring millions of dollars into tv ads. Bloomberg is a billionaire, one of the countrys richest, one of the worlds richest. Theyre running on a tax the rich platform. Joining us to see what this could mean is tim obrien, bloomberg 2020 Campaign Senior advisor. Its good to have you in, tim. Thank you, joe. Ive got to just tell you, i feel your pain i know thats not probably where you want to start, but im trying to figure out a path. I almost think the mayor would be better served to run as a republican thats where hes getting some of the support the Geographic Center of the Democratic Party is where the nastiest comments and the nastiest reception for the mayors candidacy have come from and when he does have people that sort of, you know, see him as a viable candidate, its from people that lean further right than left. Im not in pain, im excited. I think were just getting started. The mayor is coming out of the gate with the national campaign. I think the party right now is very divided i think Mike Bloombergs in this campaign because hes the most viable candidate to beat donald trump. I think theres a broad swath of democratic voters who are right in the middle of the country, both politically and geographically who want to get behind someone like that theres a lot of voters who want an adult with his hands on the Steering Wheel they feel the countrys National Security is threatened they feel the longterm Economic Security is threatened and they want someone in there with a proven track record. Hes almost a man without a country. On the left hes got the stop and frisk, hes got the billionaire, hes got the coming in and buying influence which is what theyre running against on the right hes got the nanny state, big gulp, climate change, gun control hangover issues. Hes got this if you draw it altogether, its about this big, the two circles of people that could really end up supporting him. You look at the predict it sites, bet it sites, hes tied with andrew yang. Its early days very early days. He has a great story to tell people were going to roll that story out. Hes not any one of the things youve said. Hes a problem solver, a jobs creator. He agrees in progressive policies and he puts practices behind be them he understands the business community. He respects the business community. You will know on super tuesday. Pardon me you will know on super tuesday. Hes such a good guy. Hes a great guy. I see him on the golf course. Hes wellintentioned. I just you played golf with trump, didnt you i played golf with trump. I played with Mike Bloomberg down in florida as well. I play both sides, yeah, but i just since i like him i just i dont know, i think its a fools errand i think its going to ends badly. I come at it a slightly different way but similar question than joe. He was a great mayor, Better Business person arguably as a president , i dont understand who his base is you mentioned the business community. The community that ive heard most sympathetic with him is kind of the investors wall street community, but whats his larger base . His larger base are moderate centerist democrats and independents who care about having quality leadership and quality leadership that knows how to steer the country along in the long run. It isnt just the business community. I think theres a lot of voters out there who are hungry for the solutions Mike Bloomberg can provide. Theyre sick of three years of donald trump that has worn the country down this is about competence versus chaos, common sense versus nonsense and si sill lit at this versus hostility. Tough to run against new highs, tough to run against low unemployment. The stock market is a shortterm indicator not just a shortterm where are we with regulation . Pardon me one of the reasons you put behind trump is you love how hes deregulating the economy. What percentage of federal regulations has trump knocked off the books. Do you have an answer yeah, it is, its less than 1 if youre not growing it youre whats happening to the Manufacturing Sector, joe, are they well right now . In swing states specifically the Manufacturing Sector obviously we heard it was you remember when obama said about it you cant wave a wand and it will come back weve been making some strads but were in a trade war at this point. A trade war of the president s creation a trade war with china thats basically devoured the tax cut that trump engineered. How is that trade war is the mayor against the trade war that were having . Of course he is Mike Bloomberg believes in free trade. Hes a long time how would he have dealt with the how would he have dealt with what certain of the so called seven deadly sins, i. P. Forced technology transfer. Youve heard what he said hes on the record talking about that. I. P. , that is the real issue. Thats an issue people have to come down on china on. This whole menu of other garbage that President Trump has put on the table to the detriment of the business community, to the detriment of american farmers, to the detriment of manufacturers is what put people against him on this issue. Mike bloomberg had i dont think its trump you have to worry about. Pardon me i dont think its trump you have to worry about. You have to get through the democratic primary. I think thats true theres a hurdle i think theres a story that we can tell that will matter. Theres no other democrats in swing states right nay im going to be in pennsylvania, michigan, wisconsin, arizona were going to bring this argument to trumps doorstep i think a lot of voters in those states are looking for someone like Mike Bloomberg. Whos your biggest competition, joe biden i think the biggest competition for Mike Bloomberg is donald trump. He sees it coming out of the gates treating it as a National Election its a big super tuesday play. He respects the other democrats but he differs from them significantly. His quote on china was that president xi is not a dictator he has to satisfy you dont think hed be soft on hina you dont think we needed to confront china at this point we did not need to confront china the way that donald trump confronted it, joe you should know better donald trump has confronted china in the wrong way. How is that hes cozied up to other dictators. How should he have done china . Youre not going to find Michael Bloomberg standing next to vladimir putin. How do you think we should have taken on china . I think we should have narrowly focused on intellectual property i think thats somewhere it should go in the future. Mike bloomberg will lead us there. Since the w. T. O. Weve made very little we have a lot of people who say we should not have done tariffs but they usually dont have a very good alternative. What have we got from this . Other than weve hurt our own economy. Where do you see the okay. Since the tariffs are on trump pointed out today were up 21 since the tariffs were put on, 3. 5 unemployment. Whats happening in the real econo economy . Whats that, the billionaire key con my no. No. Wages are growing much faster than they did. Job groet has started to decelerate because of the things youre pointing to. Job growth is decelerating . Yeah. Its hard to grow at 3. 5 unemployment, hard to find the workers. Thats why wages are starting to go up. He was going to create gdp 2. 9 last year. Were at 2 now were nowhere close to the 5 that trump and his cheerleaders were 40 above where we grew for obama. Thats not true right now where trump is net net the economy is almost exactly the same rate as obama. No, not number one, obama had eight years. Were at 2. 5 business. A pro business anchor and yet youre arguing against pro business policies. Im a pro business anchor looking at the environment that we have right now. We were just talking about its almost a goldilocks environment. For you to run against the economy is going to be another fools errand just like mikes candidacy. I think manufacturing workers are going to disagree with you. Manufacturing has been a problem for a long time. The standard of living arent going to agree with you. I think the bubble is here, not out there in middle america. Theres also theres the matter of 100 billion a massive, Massive Company that mike owns. Yes. 100 of in a Mike Bloomberg lets say democratic nomination scenario, what happens to that hed have to i think one of the central conflicts of the Trump Administration has been this issue around financial conflicts of interest and a failure to establish a real buffer between the oval office and private holdings i think vote squaers should know that the president has policy thats coop flikted. Thats foremost in Mike Bloombergs mind. At one point mayor bloomberg said he considered running and was not going to do it what changed his mind . Looking at the candidates who were running yeah. I think that was exactly the dynamic. Goen, he really admires a lot of those folks. He sees them as good Public Servants i think he lost faith in that pretty recently. This happened pretty quickly he sees donald trump as the biggest existential threat to the country in his tliemp and he didnt want to sit by and watch democrats miss an opportunity to challenge him effectively. Ive heard some people speculate that by the time the democratic i think there could be a brokered convention. Youre seeing right now. Looks like buttigieg is ahead in iowa Elizabeth Warren. New hampshire. Biden could get south carolina, Bernie Sanders could get nevada and then you have to move into super tuesday. I do think thats an opportunity for Mike Bloomberg to tell his story. Tough for a new york mayor. Tough to get the you know, the traction nationwide. We know him. We saw what happened they said that about trump too. Im talking about giuliani more than remember giuliani was going to he skipped that he started out in florida i think the difference here is that Rudy Giuliani didnt have a track record as a manager of a i would just feel that. Hes the 11th richest man in the world. Democrats dont want him Amy Klobuchar said we have 17 people none of us are any good. You dont come around until now and you decide none of us are worthy of the nomination it seems presumptuous and pretentious for a billionaire to come in and say ive got the right way to do this sings all of you are clowns. Your presumption and pretension is my patriotism. Hes doing it because he cares for the country. None of the other 17 are good candidates he respects those folks he just doesnt think they have the right answers. If the entire party was so far to the left as youre saying, then that doesnt explain the rise of people like Pete Buttigieg and the popularity of joe biden. Mike bloomberg is someone with deep experience and he can deliver solutions to voters. Okay. Come join us on the campaign trail. If he gets above even 10 cents on just the nomination, then i will. Lets make a bet. Lets make a bet. You can make a bet on predict it what are we going to bet on a year from now ill bet you hes not the nominee, how about that. Lets bet 100 bucks. 100 bucks i promise ill pay. You do . You can each give me 100 bucks, ill hold it. You want to bet no, no, ill hold your money. You want some of this you made the most important point. It will be hard to run against trump. He has to. Will you take all bets . Well, i dont know two 100 bets is stretching it. Youre worried about it tim, thank you for coming in. Thanks, becky. When we come back, what to watch on wall street in the final month of 2019. Take a look at the futures as we get set up for the first trading day of december. Weve whittled away some of the gains. Now the future is indicated up 37 s p up by 3. 5 and nasdaq up by 3. 5 as well. Squawk box will be coming back and well be talking Market Strategy dont forget to subscribe to our podcast. Youll get interviews, original content, and behind the scenes access look for us on apple podcasts or on your favorite podcast app and subscribe to squawk pod today. Big Holiday Weekend for the box office but also for netflix. Julia boorstin joins us to find out how much the streaming giant may have chipped away at theater ticket sales 3. 5 hours of the irishman. I saw it, i liked it. Did you watch it you saw it at homes, not in theaters i saw it in a theater. Interesting yes. Well, its now available on streaming and the question is what kind of impact that may have had just to take a step back, joe, thanksgiving was a mixed bag for hollywood. The good news is that frozen 2 grossed 124 million in america over the fiveday weekend for a worldwide total of 740 million. That, of course, shows that disney plus is not eating into disneys box office power. Knives out grossed 70 Million Worldwide is proof that audiences will turn out en masse for a grownup movie not tied to a franchise. Along with queen and slim as well as ford versus ferrari. Thanksgiving day weekend cut it from negative 7 to down 5. 6 , but the bad news is that the thanksgiving Weekend Box Office was still down 16 from last years Holiday Weekend and that could be partly attributed to netflix starting to stream the irishman on wednesday as well as more and more theatrical releases starting streaming. Marriage story will come to netflix in december and amazon is already streaming the report, which was recently in theaters all of that, of course, raises the bar for the nonfranchise films that are going to be in theaters this Holiday Weekend this Holiday Season. What else whats the expectations for the rest of that star wars coming out star wars is coming out on the 20th and this is one of those films that is a huge franchise. Theres a builtin audience. It will have a certain level of success sort of regardless of what the reviews are, but i think that is an example of the kind of film that will not be touched by the streamers because there is such anticipation and its an event film people want to leave the house for the question is when you have these films like the report on amazon or Marriage Story on on on netflix, when those are available at home, how much will that raise the bar for the other oscartype movies. There is a lot of anticipation for a movie called 1917. So i think well try to see what happens with the reviews before we make any predictions for the rest of the box office having such a strong thanksgiving certainly does set up december for better numbers. Julia, thank you. Good to see you. Joining us right now for a closer look at netflix and its big weekend with the irishman is michael olson, Piper Jaffrays Senior Analyst what do you think, mike. Was the reason you saw Lower Box Office was because of what happened with the eye rashman . Could have played a part. Thats been no secret. Netflix and disney plus are a great piece of that. Its getting great reviews it could be a part. You did your own survey where you talked to 1700 netflix customers to see how interested they were in disney plus what did you find . Yeah. So weve weve really surv surveyed thousands of netflix subscribers over the last year and weve been asking about disney plus. Theyre both Good Services so were going to see a lot of people subscribing to both of them thats what we found in our survey, 1 3 of netflix subscribers say they do want to subscribe or are subscribing to disney plus. Interestingly, only a very tiny percentage of those said they would be potentially canceling netflix as a result of seeing , there is an instance where people want to subscribe to both. Which means what in terms of what youre telling people to do with the stocks, disney or netflix . Yeah, i dont cover disney, but netflix we continue to like netflix here, we expect it will perform well not only based on just the content dollars shifting from offline to online but international as well as potential for longterm price increases, not necessarily in the next year will we see a significant price increase, we have seen price increases more recently but over the next two to three years we expect to see pricing continue to go higher for netflix. Michael, you know, netflix has great distribution and pretty good content. Disney has amazing content and nascent distribution but they have proven in the last two weeks that they figured out a pretty good model here and it feels to me like content is king again. But yet netflix trades at 60 pe, and disney is like 25 to 30 pe are those going to converge . It could be the case. Over time the opportunity for netflix isso huge internationally that thats really what is resulting in that multiple is people are looking out and saying they could have two, three, four times as many subscribers internationally as what they do today thats the reason for that multiple eventually we could see the multiples converge to some degree, but thats the answer to that question. Mike, thanks for your time. Good to see you. Thank you under an hour now until the opening bell on wall street. For a look at the markets, lets bring in paul zemsky feeling good feeling good you did take some money and go into europe and emerging markets, but you still are bullish. Bullish overall mostly in u. S. , now starting to move some into the european area and also a little into emerging markets, basically to get more exposure cyclicals the economy is bottoming we see green chutes in europe, green chutes in the end. You want to be more in cyclical stocks and the mix of europe, it is better cyclical plays and we want to be part of that. Stocks not overvalued, not expensive. Strong in a year end, but in the Second Quarter of next year, you start worrying about the election yeah, i think uncertainty or Elizabeth Warren or what both. So uncertainty we know from the tariffs and other things in the market, businesses want to be able to plan, want to be able to know what the rules theyre playing by are and as the rules change, people pull back businesses and consumers so, you know, the economy is very strong. I think thats what drives people to reelect the president. Shes down 50 . Have you looked at her number . Yeah, she peaked early. And biden and buttigieg europe is at a massive discount are you expecting to see Earnings Growth, multiple rewrite, both . Europe has more banks look at germanys yield curve today. The ten year germany note up 5, 6, 7 basis points today. Europe was pricing negative rates forever and while we may have zeroish negative rates, like the idea of the reversion of the yield curve, yield curve getting steeper, rates getting higher and germany is europe is much more industrialbased and as we see the worlds industrial activity bottoming, europe as we approach the end of the decade here, ten years of muddling through in europe could be over. Right now, more of a tactical, well see if it warrants a strategic position. More of a threemonth, sixmonth play. We have gotten this far without europe and so you figure im talking about the underlying economy here in this country, if there is green chutes in europe, then we do well here and the Unemployment Rate stays lower, gets even lower, that brings the fed back in. Second half problem of next year were on course with over 200,000 jobs expected this month, threemonth average, 160. That will keep putting downward pressure on employment rate. We could be in a situation come midsummer, were looking at 3. 3, 3. 2 Unemployment Rate and you got to think about what the fed is going to do. You dont see job growth decelerating at this point it did. It is hard to get people, right . It is hard to get you talk to businesses, they say, cant find anyone to price they want to pay there is still people on the sidelines who could come in. All right thanks, paul thank you. Lets get down to the new york Stock Exchange. Jim cramer is standing by and, jim, i missed you last week. I had a burning question ive been waiting to ask you ever since. What the heck is an ice box cake an ice box cake is something that has got a lot of topping on it, that is just sweet. It looks delicious. I saw you tweeting about it. We did a lot of baking. We actually i would say we split it among a bunch of families and it has been that way for a long time. And it certainly makes it so that the work is diversified i didnt do the turkey because a couple years ago i fried the turkey and to a crisp, and nobody lets me near it anymore. You get the ice box cake. Were back to work back to watching the markets and seeing what happens. First trading day of december today, what do you think happens given the big run we have seen with stocks to this point. Look, i dont like the fact that people are short the vix, people feel that confident i also dont like the fact that were going into a period where suddenly the chinese are playing hard ball again. I was listening to joe talk, so many people come on and say this isnt the way to approach the chinese. They never have a way to stop the chinese. Listen, maybe we need we need europe involved. Europe is selling too many cars to china maybe we need to talk tough. If someone else had a solution, then i think we listen to the solution the way it is now, i think that december 15 could come and we could raise things if the chinese dont play ball. I dont understand why people jim, there was some cynicism from people, i guess they sell bloomberg terminals in china too, that was the comment about how xi is not a dictator i wouldnt expect bloomberg to be not a dictator. Not a dictator. Youre allowed to kill people and put people in concentration camps without calling them a dictator what makes people a dictator how about concentration camps, murdering their own people maybe that makes them a in disguise maybe were too critical. We all have a vested interest in china if you thank you. Well be tuned in right at 9 00 for squawk on the street. Is this you . No. Squawk box will be right back at fidelity, online u. S. Stocks and etfs are commissionfree. And when you open a new brokerage account, your cash is automatically invested at a great rate. Thats why fidelity leads the industry in value while our competition continues to talk. Talk, talk thanks to our guest host tom farley well see you tomorrow becky will be here if we get out of this place and back in. Behind you there. Join us tomorrow. Squawk on the street is coming up right now good morning welcome to squawk on the street. Im david faber with jim cramer and were live from the new york Stock Exchange carl has this morning off. Lets give you a look at futures as we get started with trading a half hour from now last month of trading for the year, of course. Our first day of trading in the month of december. That gets us to our road map this morning and to what else, that record rally, stocks do look to start december on an upswing. This after big gains in november plus, make or break season for retailers,