Transcripts For CNBC Squawk Box 20200207

come out we'll look at the treasury yields which have been trending. here we are at 1.959 >> backing off little bit. >> we'll see what the fed thinks about this later >> the january jobs report due at 8:30 a.m. eastern expecting an increase of 158,000 nonfarm jobs the fed will release the semiannual monetary report today ahead of the fed chair's congressional testimony. the next democratic debate is tonight in new hampshire ser seven candidates will take the stage there. breaking news, thiam resigns from credit suisse in a bid to establish whether the former leader was poaching clients. saying that he was aware of the surveillance i'm sorry, he was not aware. not aware of the effort but it did result of the suicide of a private investigator andres ig nation of top executives he'll be replaced by gottlieb. shares are down on this news a lot of folks will be watching this story and what it means on the drama of what has taken place there. >> it sort of derailedthe potential they've had success. this is changing >> some people at citigroup still answer the phone solomon brothers the latest on the coronavirus outbreak death toll climbing. we are over 600 dead number of confirmed cases surging above 31,000 china's central bank saying its economy could be disrupted in the first quarter. is preparing policy tools to support its economy. sweded with a long conversation on the phone he feels they are doing very well, even building hospitals in a number of days the weather will start to warm and virus starts to become weaker and then gone president xi leads a successful operation. we are doing all we can to help. let's get to beijing with eunice >> state media says that president xi told president trump that no effort is being spared in what he calls as china's people's war against the virus. local authorities have been responding to the call hangzhou and other places have been giving official passes so only one family member can leave the home every other day for errands. tianjin is restricting entry-exit to homes. shanghai has extending if they lie about their history, could get a black mark if you lie about your medical history they have a social credit rating all of that meant to apply this is kind of implementing xeno phobia. one executive went to check on his factory in a different city but because he was an outcider, he was put in quarantine for two weeks. you are seeing a lot of activity on the ground. >> thank you for more on the ground there in china, david, good to have you here this morning. we look at the way financial markets behaved this week. we've gotten past the spread what is the latest to how people are reacting in how they are going out and participating in the world there? >> the next couple of days it will become real remember, we have had the chinese new year we'll see where people work and live look anything but normal. this place is on lockdown, restaurant shops hardly any traffic. we'll see that kicking in which people come back from holidays not just those death numbers that are tragically going higher we've had an impact today, the death of a whistle blowing doctor in wuhan. we are seeing unprecedented anger on already heavily sensored chinese social media. hundreds of millions of posts talking about how upset they are. this doctor having been punished by the police for reporting is beg held up as a martyr. >> in terms of the government's response, do you think we can derive anything in terms of the seriousness of the disease or is it the fact that china wants to become a major player in social media. you have other things going on forcing them to have a greater response can we derive anything from the response from terms of the receive severity of the disease. >> you are right the last time we had sars in 2003, you could notice if you paid attention now chinese tourism, airlines, that hit is so much larger to the global economy because of the room that china takes up china is no longer the workshop of the world it is making smartphones, very high-end technology. all of those high-tech supply chains, if this drags on and it is months, not weeks of this disruption not only will there be an immediate hit because supply chains are disrupted people will start to think, wow, if they have to get used to not having china in the supply chain, we will see a larger decoupling being massively accelerated if this goes on too long >> thank you so much okay so much more this morning. uber shares popping. the company reporting higher than ever revenue growth we'll dig through the quarter ahead of our big interview at 7:00 a.m. with uber ceo here you don't want to miss all of it we are back in a moment. how well does your financial advisor know you? 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>> hoping the company would get a little more focused on profitability, which they have the theme that this is a transform tiff year in 2020 the company saying in our core business it is time to grow responsibly. definitely a good move. >> growing responsibly also means to grow slower >> it does that is something investors are looking at and came away surprised. the ride business slowed down. gross bookings were around 20% eastbounder eats on the upside total company growth, 30%. still healthy given everything they are doing >> what is the fair market value for the stock? >> we have a price target of $54. what do they have to do to get there? >> the most important thing is to continue to show gains and secondly, avoid any sharp slow down in bookings growth. as long as we see progress, we think shares are much higher >> what are the sticking points. everybody wants the company to move towards profitability have they made the case that uber eats is profitable? >> it was interesting how they handled the eats discussion. they said we are number one or two in half of the countries where we operate eats business where we are not, we are developing a plan to become one or two or exit we saw them exit uber eats india and pursue that market through partnership. that strategy seems to be working really well. the bigger long-term question is whether they make the jump to super app status in asia where consumers do everything from book a ride to order dinner to get a dog walker that strategy hasn't really migrated to the u.s. as we look out, that is one of the key things to watch. >> let me ask you about that super app strategy how much of that, maybe it is straight option value at this point. you look at what the stock is doing right now, is there any of that built in there? >> i don't think so. you look at the mobil economy. that has moved from the browser to the app i don't think that's in the stock yet. it could be over the next year or two >> if they pick off one of their competitors in food delivery, how important is that? how will people look at that >> i'll take that first. any consolidation will be welcome even if not directly involving uber if you saw grub and doordash get together, it would be helpful for the space. investors prefer to see uber as a consolidator in the u.s. right now, they have about 20% market share you want to be the player with over 50% share when you are, you get the bulk of the profits in the space. as long as there is any consolidation, i think people would welcome it >> 10 seconds for each dara will be on in an hour from now, what would you ask? >> i would like to know the strategy moving into other businesses >> we'll count that as a super app question >> how do you continue to grow the tam for the market if you are raising prize? >> both good questions thank you. we'll sit down at 7:00 a.m. here on squauwk still to come, joe and becky live from pebble beach they'll kick things off in about 20 minutes with sun microsystems founder scott mcnealy. looking at shares of pintrest. the 2020 outlook exceeded expectations are now up 16 percent ahead of the market. we'll be right back. legendary terrain in telluride, the unparalleled landscape of park city, or the famed peaks of whistler, you've faced the hassle of lugging your gear through the airport. with ship skis, you're just a few clicks away from having your skis, snowboard and luggage shipped from your doorstep to your destination. with unrivaled pricing, real time tracking ship skis delivers, hassle free. ship ahead and go catch those first tracks on fresh snow. ship skis. your skis. delivered. apps except work.rywhere... why is that? is it because people love filling out forms? maybe they like checking with their supervisor to see how much vacation time they have. or sending corporate their expense reports. i'll let you in on a little secret. they don't. by empowering employees to manage their own tasks, paycom frees you to focus on the business of business. to learn more, visit paycom.com at comcast, we didn't build the nation's largest gig-speed network just to make businesses run faster. we built it to help them go beyond. because beyond risk... welcome to the neighborhood, guys. there is reward. ♪ ♪ beyond work and life... who else could he be? there is the moment. beyond technology... there is human ingenuity. ♪ ♪ every day, comcast business is helping businesses go beyond the expected, to do the extraordinary. take your business beyond. the january jobs report is out in about two hours expecting an increase of 158,000 of nonfarm jobs holding steady at 3.5%. good morning to you both what are you expecting in terms of your forecast what does it say about the pace of the economy to start the year >> we'll see the pace below 150,000. very much in line with the slower job creation. doing so as a noticeably slower clip i would add there is a down side risk we could see a number as low as 123,000. we did see that pick up. employment was still relatively weak we have seen lingering pull back there are reports of weakness still lingering on the labor front that will keep us at the lower more moderate level. we also got a very strong employment number a few days ago. how does that feel to you right now for the head new count >> i any we can surprise to the upside if not this month. this quarter ceos are feeling more confident. when they feel more confident, they take morris being when they take more risk, they make more jobs >> largely, jobs have been strong but wages have lagged people are surprised wages aren't stronger. allen, i'll start with you what do you think about that >> with this growth, no one has been able to come up with a good answer it has rebounded from last month. it will still continue to be sleepy that said, youhave powerful wage growth like data, science in engineering space >> is there anything misunderstood about the labor market rye now demographic effects or what can we expect on the wage front? >> i think wages are going to remain repressed i would say a sub 3% hourly earnings is low. that calls into question if we are accurately measuring we should be talking about 3, 3.5, 4% wage gains on a sustained basis. perhaps we are not capturing the full level of joblessness especially when we talk about the americans silting job less for a long time. we are talking about unemployment rate closer to 7% which more closely coincides with the sub 3% hourly earnings rate i think there are other things that are not accurately capturing those rates. >> and another reason why the federal reserve is not alarmed or going to do anything because unemployment remains at these lower levels coming up, an interview with uber ceo at the top of the hour. we'll talk tech with sun microsystems founder scott mcnealy. look at activition blizzard prizing and drop foraktw te-o interactive. squawk returns after this. ♪ ♪ yes i'm stuck in the middle with you, ♪ no one likes to feel stuck, boxed in, or held back. especially by something like your cloud. it's a problem. but the ibm cloud is different. it's open and flexible enough to manage all your apps and data securely, anywhere, across all your clouds. so it can help take on anything from rebooking flights on the fly, to restocking shelves on demand, without getting in your way. ♪ ♪ you should be mad your neighbor always wants to hang out. and you should be mad your smart fridge is unnecessarily complicated. make ice. making ice. but you're not mad because you have e*trade which isn't complicated. their tools make trading quicker and simpler so you can take on the markets with confidence. don't get mad get e*trade and start trading commission free today. good morning live from the nasdaq market. red across the screen. dow looks like it will open down s&p 500 off about 12 points ahead of the big jobs number we'll get out where we've gathered to hit the links. joe and becky there ahead of a huge lineup. what do you have >> we have a huge lineup i guess celebrities and ceos making it pretty interesting we do talk about golf but there is a lot we talk about to the up and to the down, we'll be joined by scott mcnealy coming up. we'll talk to him about technology he tends to be pretty outspoken about other issues too >> his famous quote -- his son is a really good golfer. >> there he is, speaking of. >> here he is. i'm going to speak for him when one would say why is the economy doing so well. he would say, that's what happens when you stop water boarding the private sector. >> he said that here >> he did. it doesn't take much to get him started. >> michael worth, ceo of chevron. we'll talk to him about oil prices and the theory that put out that it is the millennials that don't want to invest in these fossil fuel companies. >> i don't know when we'll have electric planes. there will still be some fossil fuels. i think it is weird. we have a strong economy global and oil is breaking under 50 >> you are going to see a pull back there one of the major houses thinks china's growth could fall to 1%. that is huge for the global economy. second largest economy in the world. we'll talk about that. david will be joining us to talk cbs. rand dal stevenson a lot happening with at&t and the screaming wars >> did they move on? elliott management >> they have softbank now. and we'll talk about streaming wars and what he sees happening. >> friends reunion >> warner brothers that's big. >> it is >> one show? >> it sounds like it it is going to be more like reflection, interviews ellen has been mentioned to be the interviewee. >> friends and maybe they'll super size the reunion it all comes back. and the launch hbo max >> okay. that's what we have coming up. >> we'll be seeing you guys a lot. scott mcnealy, never one to hold back we are looking forward to that coming up, the clash of the titans taking a stake in softbank what that means for ceo massa son. you can watch and listen to us live on the go on the app. squawk pod, you'll get taped interviews, hinld the scenes access and more. stay tuned, "squawk box" will be right back at fidelity, online u.s. stocks and etfs are commission-free. and when you open a new brokerage account, your cash is automatically invested at a great rate. that's why fidelity leads the industry in value while our competition continues to talk. ♪ talk, talk welcome back to "squawk box. we have a very busy morning. we'll be talking to uber ceo in a few minutes but before we do that, joe and becky are at pebble beach ready to kick things off now joe. >> looked like you were in pebble beach pretend you are out there. how you doing? joining us now, veteran of silicon valley, scott mcnealy joining us now what are you doing >> living the dream. >> you are living the dream. playing with your son. he was two under and had four putt to 18 >> it was tough. he's such a passionate, focused, determined guy >> where did he get that, i wonder >> he's a real class act >> you sold your last company to cheetah. now what are you doing >> i'm in the dot org world. i believe k-12 education needs to be fixed. from my perspective, the best way is by a platform for course wear to be involved that needs to be open and free and global we are building that platform to build course wear with ar and vr, collaboration tools, chat box, machine learning and ai and a data ocean so we can create really powerful next generation. think khan on steroids >> do you think schools would do that >> parents, teachers, students, churches everybody would ice this like everybody uses ios or linyx. there is not a platform everybody uses that is free. we are building the platform my son is doing birdies for education. you can read my blog about being a pga tour daddy he's going to raise a million dollars himself this year just for the curriki effort >> people think tech is undersold and yet the trillion dollar companies keep coming in. you are outspoken for the sector i will say small government and private sector brings the most wealth to the most people. >> the scope for the government is stunning. it is true in this statement when i was born -- what is the federal budget this year when i was born, the federal spending budget was $70 billion. think about the scope creep and the massive growth everything the government does is a monopoly and ultimately a tax-funded plr tax-funded monopoly. think iowa they can't even count the votes. the government isn't capable and functional i'm not saying we shouldn't have one state department, one defense department, law enforcement. >> maybe we should have a few charter schools or curriculum. what do you call them, not public schools, you call them government schools you've used that term. i believe they are government schools. it isn't public. >> scott, at the same time, you have a real demand that wants to see universal health care, one system for these things. people in iowa pay more for health care than i do for rent or my mortgageage a month. >> i think your health is the most valuable thing you have it will probably be the thing you spend the most money on. what is the phrase your health means everything to you? that's not free. we need to priorities spending my boys, all four of them, we trained to be responsible. i said have kids when you can afford them. pay for your own kids. get out there, get a job and build financial wear with all and support your kids with education, food, a house, education, health care if we had -- the government -- if it is really important, you don't want a monop lircher ly doing it i read the anti-trust act. i studied at at harvard. that's the problem we all know and get all bent out of shape when somebody approaches a monopoly like google >> andrew, i'm sure you have a question >> bill barr said the trump administration thinks the u.s. government should try to buy ericcson or nokia. what do you make of that given your strong feelings >> i don't think the government should be getting into telecom companies. >> i think our antitrust laws make it criminal to be successful that's not good. i had a big challenge with bill gates. he was a brilliant businessman we went after him and had a large settlement he wasn't a criminal the way you should treat a monopolist is like secretariat we should not shoot the greyhound who catches the bunny. maybe we should have bought microsoft and share to all of those other companies. >> i think bill barr's point is more on the security if we want to compete with huawei >> law enforcement and security is a very, very important role protecting our rights. a right is something you can give to everyone without taking from anybody health care is not exactly something you can give to everyone without taking from anyone >> you think the economy under this administration is doing okay >> yeah. like i said, we were getting water boarded for a lack of better words >> i felt we were headed down a slippery slope >> i was surprised i said the worlds worst ceo would be a thousand times better than the best politician i still believe that and trump is far and a way not the worst ceo in the world >> we go today at spy glass around 10:15 it is really hard to sitin you son's office and watch him on tv cameras and then have him analyze my swing >> he just turns away when you swing? right. >> spy glass is the only course in the world where every hole is up hill. >> into the wind i almost went over the sea wall. i thought my son would be embarrassed. >> it is a crazy, crazy game sad when i can't wait to get back in front of a camera because such bad things are happening out there. >> andrew. thank you for that conversation i know you have a lot more coming up. a busy morning still to come up next from pebble beach, discovery ceo will join us but first uber ceo will join us here in studio. when you look at the critical issues facing our world, what do you see? we see a billion more people breathing free. we see access to fresh food being the global norm, not the exception. we see homes staying cooler, without the planet getting warmer. at emerson, when issues become inspiration, focusing core strengths to create a better world isn't just a result, it's a responsibility. emerson. consider it solved. this coming after soft bank poured $10 billion into rework and then major lay offs last year joining us in what could be next and whether this is the fight of the century. bradley tusk is here good morning to you. >> good morning. >> it feels like a fight might be coming. you're not so sure. >> i think that you can see all the reasons why he finds this attractive the valuation is clearly there it's really only a small part of the overall portfolio. >> it's alibaba. >> you can see why it makes sense and the question is how many controls can you choose to live with? do you want to fight this out? and it seems like the different reforms soft bank has only two of 11 independent directors and quite frankly from the tech sector they could use it >> he did it a long time ago the laws, the activists, trat gi strategists, the shareholder base isn't as friendly to a western activist as far as soft bank goes bradley said two directors >> what do you think is going to happen though? are you thinking masa is going to say talk to the hand? >> no, i don't i think this is about the power of the argument. there's a lot of value there i think he's going to come in and ask for a $20 billion buy back and the biggest beneficiary is going to be masa son with his 22% only. >> the entire ethos, i'm investing for 100 years and i'm creating a world, it's not let me close the discount. >> for sure. if there's ever a moment where maybe they want to question that ethos after a lot of investments. >> this has been enormous shoot the moon success frankly with the help of the saudis with the vision fund and everybody else and the idea that all of a sudden, you know, he is going to have them running around. >> it's not all of a sudden either he did a $5 billion buy back last year and the stock went up 17% as a result of the buy back. >> that was without an activist at his door. it's not going to take a lot to appease elliott here i think they kind of -- they're like minded in a sense. >> is there any sense -- we mentioned this before for 25 years we were hearing about activists going to japan because there's valuations at a discount is there any sense they talked about creating -- they created the nikkei 400 to focus on roe is there any sense that japanese companies in general are more open to activist pressure we have to saythank you. >> a huge hour or two hours ahead. he'll be here to talk about the company's accelerated time line for key profitability goals. wall street responding favorably with the stock up sharply and then pebble beach wi a hthuge line-up including randall stevenson. ceo of at&t. two hours ahead right here on squawk blocking the pd-l1 protein, lets the immune system attack, attack, attack cancer. pd-l1 transformed, revolutionized, immunotherapy. pd-l1 saved my life. saved my life. saved my life. what we do here at dana-faber, changes lives everywhere. everywhere. everywhere. everywhere. everywhere. robinwithout the commission fees. so, you can start investing today wherever you are - even hanging with your dog. so, what are you waiting for? download now and get your first stock on us. robinhood. there's a special presentation of squawk box live with some of the biggest and most powerful names in business. >> including the discovery ceo and chevron chief and famed venture capitalist jeff yang legendary investor jimmy dunn. the nonexecutive chairman and at&t ceo randall stevenson. >> plus live from the nasdaq market site in times square an exclusive interview with the uber ceo as the second hour of squawk box begins right now. good morning, welcome back to squawk box on cnbc. i'm becky quick with joe in pebble beach and andrew is in new york today and we have been keeping an eye on the u.s. equity futures they're under some pressure. looks like the dow futures would open down by 122 points from here chevron chief and d.c. investor jeff yang but first we'll begin with the news maker back in new york with andrew. >> thank you uber shares rising this morning. take a look at what's going on the ride sharing giant announcing on its call with investors it's moving up it's target of profitability by a year that stock is up 7.5%. joining us right now is ube uber ceo good morning to you. >> good orning well, we became more and more confident if you look at the business for example in 2019 for every dollar of revenue growth that the business achieved they dropped about 80 cents to the bottom line so this is a business that as it grows can become quite profitable and for 2020 we got together as a team so if you look at our plan for 2020 there will be dollar revenue growth especially from q-4 to q-4 we expect to drop 55 cents to the bottom line. it's doable to get to profitability but at the same time make the kinds of investments that we want to make to keep a high growth rate for many years. >> i want to talk about the other investments in a second because that's going to be an issue or at least a question mark in terms of how you get there but in terms of the ride share business itself you talked about pricing and increasing pricing and one of the questions is about your ability to grow. what the total addressable market looks like, especially if you increase prices. there's some pricing power that we have because it's a service that people use every day and a service well priced. and over 50% year on year. it's growing over 300% so that's a way of increasing the average price but really going after a more premium customer i feel that i'm not getting the promotional pricing anymore. >> hopefully good for all of us. i do think that the era of only pricing to win business is over and leading to actually having a great service. making sure that every time you take uber you have your safety area you can text 911 if anything happens. we think you should price based on service. >> it doesn't feel like that is working at the moment. >> it allows you to discount a ride based on the efficiency we were overdiscounted it was an easy way for growth and our cfo talked about we're not going to grow with empty calories so with the service now we're pricing it closer to its natural price point and actually we're now innovatingwe get essentially there's no car and traffic is lower that's one way. >> let's talk about uber eats. it's the other major growth piece and money losing piece >> what do you need to do to get it to that component of it >> we need to grow and consolidate. it grew 70% year on year in terms of bookings. it grew over 150% in terms of revenue. aisha scale player we're by far the fastest growing. that's a good thing. at the same time, what we have committed to is to get to number one and number two and every market that we compete in in 12 to 18 months and you see that happening. so for example in india where we had two very strong competitors, we decided to sell our business to one of them and they're going to work well together. >> some investors are worried that you may have to overpay to pick off your competitors. >> you're cheep like me? >> it's a great company. we'll pay up but plan a is always organic growth so as long as organic growth is plan a, plan b which is acquisitions is always going to be opportunisticwe made the determination that the best way to go forward is stand alone it takes corner grocery stores and put them on our platform we will buy when we see something new and a team that's particularly talented but we're going to be pretty choiceful when we do. >> do you anticipate getting out of other big markets. >> it represents the significant majority of our bookings but there's some countries that are in the bubble and we either have to see a clear path to number one or number two in profitability or we're going to look to consolidate. >> we had some analysts on that talked about the prospect of option value on the potential of creating a superap when the number of users that use more than one service has increased by over 50% year on year and they use this almost 16 times a month so the frequency increases by three times we're exploring the super ap concept. >> is that going to be a global thing or in certain markets where you think there's an opportunity because here in the united states you think if someone was going to create a super app you would have thought facebook would have done it a long time ago. >> every market is different and we want to make sure that we reflect the needs of that market so it's going to be market to market i noticed that you shutdown some drivers. what do you see as a result of all of this. >> first of all, anything that we do is based on the advice of local health authorities we want to be very diligent. we are not seeing a significant effect on the business overall where we see an effect is in north asia for example, business in hong kong, airport businesses now pretty significantly from an overall standpoint with our portfolio it's not material in anyway. >> we looked at who road with him and took him off the system to make sure that they're okay now we think that things are now returned to normal but again, the data that we have allows us to create a great service and this is an advantage it's not how you want to use the service but it is potential. >> talking about the data you have, i have a privacy question for you which is there was some news recently that there was a passenger who was a ceo of a company in arizona that was filmed inside a car. >> well, the laws, the privacy laws in every state are different. right and there are some that have security cameras for safety reasons and it's totally understandable. >> do you want those in all the cars >> i think it's up to the drivers whether they want them in all the cars. we're working on testing systems where you can record a ride for example in brazil during those circumstances and we want to make sure that both the rider and the driver know exactly what is going on. >> right. >> and we want to make sure that the data doesn't rest with either player. it rests in the cloud some place and is only when needed. so i think these privacy issues are complex. i think disclosure is incredibly important to the extent that it moves safety forward. >> i think he did pretty well. he has a new business that's about making food for delivery do you ever anticipate being back in business with him? >> we do business with restaurants. the more restaurants they are, the higher quality restaurants, the better for us so we are doing business with his cloud kitchen right now. and based on what i hear that business is going to grow. >> thank you for coming in this morning. >> thank you. >> very good to see you. >> our line-up of news makers that keeps oncoming. david zaslav is going to join us from pebble beach in a minute. take a look at u.s. equity futures ahead of the jobs report that comes out at 8:30 and may change all the numbers but the dow looks like it will open 118 points down. you can always watch us live you can do it now on the cnbc app. u' wchg uaed yoreatinsqwk we made usaa insurance for members like kate. a former army medic, made of the flexibility to handle whatever monday has in store and tackle four things at once. so when her car got hit, she didn't worry. she simply filed a claim on her usaa app and said... i got this. usaa insurance is made the way kate needs it - easy. she can even pick her payment plan so it's easy on her budget and her life. usaa. what you're made of, we're made for. usaa when it comes to your business internet, which is more important? ♪ ♪ okay, i wish i didn't have to choose. like the more i think about it, the more i want to jump to each room. what if i said you can have it all? ♪ ♪ comcast business gives you connectivity that goes beyond. that's what we want! that's speed, reliability, and security, all from one provider. touchdown! get started with internet and voice for an amazing price. call today. comcast business. beyond fast. now you can, with shipsticks.com! no more lugging your clubs through the airport or risk having your clubs lost or damaged by the airlines. sending your own clubs ahead with shipsticks.com makes it fast & easy to get to your golf destination. with just a few clicks or a phone call, we'll pick up and deliver your clubs on-time, guaranteed, for as low as $39.99. shipsticks.com saves you time and money. make it simple. make it ship sticks. regardless. >> it used to be everything was consumed on the tv so you need to be on all the platforms. so we're attacking it. and we have a local language netflix that competes with them. and we just launched a partnership about 8 months ago and in europe we have free to air and cable. local language entertainment, non-fiction and sports so we're local in europe and growing and having real success and then we have a number of affinity products like golf. and one of the great players from thailand. >> so it's a local sport half of the players and the p kbrks a tour and international i got in a little because we're following the local players which is working for us and then in the u.s., we think we have something that's really unique because we don't do scripted series and scripted movies we have the top channels for women. i.d., tlc, hgtv, food, oprah winfrey, chip and joanna gains and so, you know, you have viacom and cbs they'll put all of their content together and doing fantastically well and netflix and if we go ahead which we're looking, we think we're probably going to that you pay a fee or you authenticate through us and you'd see all of our brands and that's where the number one or number two player for women in america and you see all the content that you love plus discovery. and you can watch anything on hgtv or oprah. it's a younger audience and they're spending more time watching our stuff and we're getting a little over two times the cpm. so there's no question that the economics on monetizing people that are consuming content on devices is very strong you get better data. the key is that people can watch anything so how do you currate in a way that people do your stuff. that's going to be the challenge for every one of these authenticated or free products the thing that we have is when people watch tv which is an environment where they can watch anything the majority of women in america are watching on any given night one of our channels. so if you saw our product and you saw chip and joanna gains and oprah and tlc and i.d. and food and discovery you'd be able to cure rate throuate through t opposed to shows it's just a party for everyone i'm just wondering how it shapes out. they're all there. it's not like they're gone. >> it doesn't exactly feel like a party. the truth is that media in general, the multiples on media have come down in the last five years or so >> you may have as much as anyone else in the world but are we sure that people are going to be watching it where as netflix and disney right now to their credit, netflix has established themselves as direct to consumer product where they have credit cards. 150 million or more and disney is on their way. we're on our way and it's our job to let people know that we have differentiated content whether it's local language content, outside of the u.s. or all the great womens and men's content we have in the u.s. we want that as part of our library because we have to get bigger. >> it's been a longer swing. last year we were up 32% we were the best performing media stock but we're still cheap on a free cash flow basis because the last four years or so media has taken a pause where they have said let's take a look and let's see who is the winner. one of our largest shareholders has been a great shepherd to me over the last 14 years, he bought us some stock a couple of months ago we have the right pieces in order to be successful and we have things that are unique we're the number one international media company and the number one sports company outside of the u.s. >> were you at pebble yesterday? >> i played pretty good yesterday. >> i wouldn't say good. >> the new swing. >> the new swing is working. >> yeah. recommended. >> golf digest so first hole 495 yard par 4 do you want to see my par 5? >> are you about to put it on there. >> i was playing golf with you 25 -- more than 25 years ago you were always good you were always very good. >> don't bring that up. >> you didn't know who showed up on time. >> those were the days. >> i pulled out a driver on that par 3. >> he shows up he shows up on the third hole. and it hits the house on the other side of the street he handled it well he took it and put it in. >> good luck >> a great day to have you you're always excited. that helps coming up we'll talk about oil prices and the coronavirus and much more. how much does the academy awards oscar statuette cost? the answer when cnbc squawk box returns. because health insurance doesn't always pay it all. aflac! after surgery we had extra bills followed up visits, deductibles. but it didn't. aflac gives you money directly to help you with those things. i want to thank my wife, my mom, the duck. get help with expenses health insurance doesn't cover. get to know us at aflac.com a new kind of investor is changing things up. [ indistinct talking ] with an app that's changing the way we do money. download robinhood now. and when you open a new brokerage account, your cash is automatically invested at a great rate. that's why fidelity leads the industry in value while our competition continues to talk. ♪ talk, talk . >> stay tuned, squawk box from pebble beach returns right after this new york state is building for the future of your business. with a nation-leading $150 billion commitment to infrastructure, we're creating state of the art, 21st century transportation hubs, constructing new bridges, bringing high-speed internet to every corner of the state, and committing to low-cost clean energy. with infrastructure built for the future, the companies of tomorrow can thrive here today. see your future at esd.ny.gov. >> it's amply identified concerns wti trading down 62 cents barrel. it's down more than 19% just over the last month. joining us right now to talk about this and much more is michael worth. he's the ceo and chairman of chevron and thank you for being here today. >> pleasure to be here let's talk about what's happening to the global demand outlook. do you have your own internal measurements on what you're expecting at this point? >> we do >> it's off considerably normally we see shifts with the new year and this is amply identified and commodity markets are there. >> is that based on $50 barrel or higher? >> we layed out a higher number but we work across a range of prices and have sized our company and our operation and investments to compete in an environment that looks like the one we're in now so we're well prepared for a market like this. >> the big write down that you took in the last quarter was more related to natural gas prices and looking at some of your assets across that ase. and some of them were acquired at a time when gas prices were stronger and would be stronger in the u.s. with the changes in unconventional production of fracking we have seen a very well supplied market and these are investments that struggle to compete within our portfolio versus other things so we made some choices about how we're going to invest our capital. >> which is what lay that strategy out for us where do you think the best places are it's here. >> certainly in the united states we're investing several billion dollars a year in west texas. and we have a global position and good opportunities around the world as well. >> do you think that you will -- the industry itself will be funded sufficiently for operations and exploration and production for the next ten years? young people don't want to have anything to do with oil companies. they don't want their 401ks invested in oil companies. i worry about 50,000 flights a day of using jet fuel. we mentioned what it was like when we had a disruption because of a hurricane on the east coast and i understand where these people want to get but i don't know how it's going to take me across the atlantic. are you going to be funded is this something that could hurt the industries efforts to supply the world with cheap oil? >> well, certainly there's been a lot of attention around this issue. and it's not an appropriate one at all i think the world would be just fine and i think that's the reality we're working on making energy more reliable, affordable and cleaner and we always have and we always will. >> are the stocks never going up again because of this? >> no, i think they will we have been in a rough period of time. commodity prices had a historic collapse last decade they're still very low because we have a well supplied market and companies had to resize their investments accordingly. we generated tremendous cash flow >> that was jim's point. jim's point was you're doing all the right things and you're not getting credit for the buy backs or other big things that you put into it. >> we need to continue to deliver results quarter after quarter. >> you point out that they have been under pressure for a long time that's because of the drilling taking place here in the united states and are you just looking at a world where 50 to $60 oil. it's the story of commodity markets and everything has become much more economical as a result. >> when you hear opec talking about production do you think that that matters? >> opec plus other countries have managed to take supply off the market to try to keep markets some what in balance and we haven't had a market that's been well supplied for a number of years they have been fairly effective at doing that and we'll have to see what they do they still do have an impact >> on your earnings call you'd be maintaining the capex that you have done before is that still the picture even if the demand outlook changes for this year? >> we invest for the long-term. and. this is one of my favorite stories here i love that. >> 8. >> we're 8 under. >> that's fantastic. i'm fortunate to be surrounded by remarkable women at work and at home. it's my pleasureto support them. >> you're doing okay she's a better golfer, better tennis player. appearance and everything but you're ceo of chevron. >> i married up, joe. >> tell me about it. we know about that and quail too. >> yes, i married up too >> great to see you. we appreciate your time. >> still to come, our host for the day, chairman and ceo randall stevenson is going to be here apparently there's no video. >> it's just audio. >> download where ever you get your podcast stay tuned squawk box is coming right back at synchrony, we're changing what's possible every single day. with technology that helps you offer shoppers a better experience. take your company's app. we can add in all sorts of capabilities, which help your customers manage rewards, offers, and payments on the fly. and now, applying for credit can happen in a flash. that way, more people can start shopping with you on the spot, wherever they are. how's that for changing what's possible? 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>> the biggest question that i have about that story is the regulatory challenges and from california and all the rest of it and that is a big game changer in terms of margins and your ability to become profitable >> coming up when we return calling all unicorns the public and private market debate. later this morning you'll miss a live interview with vice president mike pence you're wchg ua rhtatinsqwkig here on cnbc apps are used everywhere... except work. why is that? is it because people love filling out forms? maybe they like checking with their supervisor to see how much vacation time they have. or sending corporate their expense reports. i'll let you in on a little secret. they don't. by empowering employees to manage their own tasks, paycom frees you to focus on the business of business. to learn more, visit paycom.com which of your devices are protected by daily security updates? daily security updates... daily? i don't know. the only thing... i'm struggling with this. some providers you have to manually download updates to each device. comcast business securityedge updates every 10 minutes to help keep your connected devices protected against new ransomware, malware and phishing threats. every 10 minutes feels pretty good. comcast business security edge automatically helps protect all the devices on your network. call today. comcast business. beyond fast. i'm jennie garth, and as a mother of 3, i know kids worry about a lot of things. getting enough food to eat shouldn't be one of them, but here in america, that is a real worry for 1 in 5 children. this is unacceptable and something feeding america is working to solve. through a nationwide network of food banks, feeding america serves virtually every community in the united states, including yours. see how you can help your community. visit feedingamerica.org. together, we can solve hunger. together, we're feeding america. a really heavy handed approach but let's start with public and private. there's a reason to go public, obviously. it's uncomfortable and more growing pains but that's still it >> if you're a consumer brand it helps build branding and gets access to public market and capital and provides liquidity for investors and insiders and in general it's still the mark of a successful global company. if you look back at the ipos of uber and lyft they struggle to get the valuations that they're looking for and it's maybe a turning point of what public investors were looking for in terms of profitabilityand you had a lot ofgrowth at any pric kind of mentality. what you saw, what you saw kind of in the go-go days of the bubbleand they were probably one of the more public opponents of that. a very strong vision very and a winner take all kind of environment and that works in capital markets and it doesn't work in others and i think what happened with we work was a little bit of a milestone in terms of what people were looking for. >> do you think elliott getting involved with we work, i'm sorry, with softbank is the signal that look, this is new world. we're going to be looking for profits. it's not going to exist like this anymore. >> yeah. you know, i think it is -- it is a -- it's a milestone in that you definitely see that and it's also, i think, a milestone in terms of activists getting involved in almost any kind of company, right and it's almost -- it doesn't matter what the size is. it doesn't matter what the industry is and it used to be more -- you used to think about it on a more confined basis and now it's anywhere. >> what's the convergence between media and technology when you were at ibm did you know that you'd have to know about streaming and how to approach the profitability of all of this? i mean, i just thought i love television. >> i love television. >> look where we are though. there's a lot of others -- i mean, enterprise software and, you know, all of those things. i understand, and for some reason we do focus on the even think about it, all of these companies are media companies. >> right. >> all the technology has converged. what about streaming is that going to be a profitable venture five years for now from everyone in involved is that going to be how we all consume content? >> well, i mean, i think, so, you know, when people talk about streaming they think really about video on demand and subscription video on demand and i think that the paid subscription video on demand stuff is what is getting all the attention and it is really the new generation of paid tv. whether it's, what used to be cable or satellite is really migrating to subscription video on demand. and that's going to be a really big space. you know, i think there's going to be a new bundle and it's an inexpensive bundle which is a great compliment to paid streaming services and you see people like roku out there and they're having good success. p peacock will launch mid next year and amazon will be coming out with something. >> see if they're going to be going within that phase. >> so i think that you're going to have a lot of people that you used to think about advertising isn't really dead as a model because i think a lot of the people that are, the people that are really interested in millennials and gen z, they have been held, you know, the whole -- all the consumers have been held in this expensive bundle for a really long time and people wanted cheaper al ala carte services and now that they're available you'll see a skinny bundle that's very successful in addition to the paid bundle that everybody is really focused on and talking about right now. >> who is most at risk of the heavyhand of regulation at this point? facebook, google looking at google -- i mean -- >> yeah. >> what is -- who would you worry about? who are you worried about? is it going to be sort of a token look at these companies and they're going to be allowed to do whatever they want or is it -- >> no, i think there will be and there probably should be regulation there should be more rules of the road and some of it is the media companies are redefining the landscape. they have been self-regulated and they're getting criticized for the decisions that they're making because they make some of the decisions not knowing what the ramifications are and if you're facebook is an example, you have maybe the largest global media platform in history. but at the same time clearly some things have worked out. whether it's misinformation or privacy and whether it's possible anti-competitive type stuff. they want to work in cooperation with government in terms of what should be. and regulators should want to do it there should be more parallels. >> where are you today >> i'm here. >> that was very interesting >> well, at least you shook my hand. >> i did. >> there was no snub there, right? >> thank you >> thank you >> i have been wanting to do that was that surreal or not? have you ever seen anything? >> no, i miss that. >> yeah. >> i was praying >> when we come back, it's jobs friday we'll get ready for today's 8:30 release with famed investor stay tuned you are watching squawk box on cnbc. imagine traveling hassle-free with your golf clubs. now you can, with shipsticks.com! no more lugging your clubs through the airport or risk having your clubs lost or damaged by the airlines. sending your own clubs ahead with shipsticks.com makes it fast & easy to get to your golf destination. with just a few clicks or a phone call, we'll pick up and deliver your clubs on-time, guaranteed, for as low as $39.99. shipsticks.com saves you time and money. make it simple. make it ship sticks. shipsticks.com saves you time and money. itso chantix can help you quit slow turkey. along with support, chantix is proven to help you quit. with chantix you can keep smoking at first and ease into quitting. chantix reduces the urge so when the day arrives, you'll be more ready to kiss cigarettes goodbye. when you try to quit smoking, with or without chantix, you may have nicotine withdrawal symptoms. stop chantix and get help right away if you have changes in behavior or thinking, aggression, hostility, depressed mood, suicidal thoughts or actions, seizures, new or worse heart or blood vessel problems, sleepwalking, or life-threatening allergic and skin reactions. decrease alcohol use. use caution driving or operating machinery. tell your doctor if you've had mental health problems. the most common side effect is nausea. quit smoking slow turkey. talk to your doctor about chantix. this is a special edition of squawk box jobs friday in america we're just 30 minutes away from january's all important employment report. plus more news making interviews live from the at&t pebble beach pro am in california this hour, piper sandler's jimmy dunn on the markets. david on the coronavirus outbreak and at&t chairman and ceo randall stevenson on media, streaming and much more. the final hour of squawk box begins right now. andrew ross sorkin is holding down the fort and he's actually okay back there you love where you are we just talked about what it's like out here, andrew. and jason is back there as well. chairman and we all have our preferences. you're fine back there but this is -- is there any place like this >> pebble beach is a class by itself >> it's rarified air. >> are there places in new zealand like this. >> there's some but this is closer it's the best there is. >> cypress probably doesn't want to talk about that but two courses because they're both magnificent. pebble beach versus cypress. i think it's amazing i love the course itself and i love cypress but i get to 16 and it's like i know that i'm going to get like a 12 or something. >> you're right. they're both spectacular pebble beach is a world class site. >> which one would you rather play >> cypress. >> i love cypress and a love pebble. >> either of them you're lucky. >> it's a pristine part of the world that needs to be protected. >> it's special, it's unique, and it's wonderful. >> walking the course here at some point. >> did you go this year? >> i will later. but i walked on pebble for awhile that's spectacular. >> it's great shape. all the golf courses >> the accommodations. >> having cnbc here which is really sort of the icing on the cake wouldn't you say. >> i would keep talking like that because we love coming here. >> anyway, andrew, you got -- anyway. >> you're making me jealous. >> you're making me jealous. it's early in the morning though. >> yeah, well that's true. >> that's true. >> it's 5:00 a.m. here >> we're going to come back in a second we want to bring everybody up to date with a couple of big headlines. uber ceo saying his company is weathering the outbreak of the krr coronavirus well >> we're not seeing a significant effect on the business overall where we see an effect is in north asia for example, business in hong kong, business is down pretty significantly from an overall standpoint with our portfolio it's not material in anyway. >> and uber reported quarterly results last night posting a smaller than expected loss and moving up it's profitability target by a year and that's pushing the stock up this morning about 6.5% and it's better than expected results for revenue and profit in it's third quarter but you're looking at that stock off about 7% and boeing suppliers spirit air system cutting it's quarterly dividend to 12 cents due to the disruptions caused by the grounding of the 737 max the move was in the best interest of the company and it's shareholders and it will consider further action regarding the dividend depending on when the max returns to service. in the meantime, i want to go back to pebble beach right now where joe and becky are standing by hey, guys. >> we're here to talk about the markets and much more. let's welcome the senior managing principle at piper sandler. this is the first time >> that's right. we completed the merger on january 3rd and we're very excited about it we really like the people and we have already been able to do a few things together and after 6 or 7 months you know if you did the right thing or not and we're ecstatic and happy about what's going on >> how does it change how you operate? >> well, you know, we're now a public company which it doesn't change a lot for me because the last few years i really just worked on deals and client driven stuff and he has been running the company for the last several years. he is the key executive and i'm there to basically help any client, do any deal, help any person be successful we have a summer intern, what was it like after the big announcement the first day they were hollaring but yesterday it was like nothing happened. >> i thought it was you going around talking to local banks. you get together here, you do this, you do that. aren't you covering many different industries >> it does it certainly broadens who we can speak to and who our relationships are. so i have a lot of relationships outside of the banking industry. i have several of them are partners so that will access that we have been able to do something things like that we're doing one today i hope and so it broadens the brush for what i call bankers that have soft hands so that's what you could have done >> well, you know, i think that they are good people and they're smart and they're nice they're nicer than we are actually that's good. it's not hard to be nicer than we are but they're very nice very smart and no, we're excited about it it's working well and will continue to and john doyle is the guy now. so he's running the day-to-day stuff. >> what deal are you working on today? >> well, i'm working on a situation which is something that we couldn't have done in another world. we're going to work on a couple of different industry things and a bank deal and one or two bank-like deals. some of the largest deals last year were not bank deals it was a couple of others like that >> when did you know interest rates were never going to go up again? >> well, i was always -- i was always sort of a fed chairman. we talked about hat. >> you bring that hard reality to your clients every day. >> there's a reality there are positives. you have to understand with the banks, most of them have more capital than they need and doing buy backs and having evaluations at historically low reference points they can get high single digit returns and with the low interest rates they are a pretty safe investment and we have a flat yield curve and they thought they were going to retire on x amount with this much income and the income is just not there. >> the income will not be there. i don't think it will be there throughout the year and the economy has no real reason to do anything but i think through at least the first quarter 21 before you'll see some kind of rise in the interest rate. >> what do you hear from the coronavirus? how does that play out >> bad it's going to definitely have an effect and it has as much effect on the u.s. economy but it does have an effect on the overall economy and the real effect is the perception that whatever we're hearing multiply it by 10 because that's the reality like, if this was what it was, i think it would be some what containable. the real feeling is the truth to interfere with a good story. i'm worried about how much it really is. >> you know. >> there's two mayors in the race mayor mike and mayor pete. >> i know mayor mike. >> money can go a long way and we see that. if you spend enough, he's making a real difference. i'm not sure how it plays out because i just can't imagine where the democratic party is. >> that's all they talk about. >> first of all, it just happened so you have all of these different people in iowa campaigning. all spending $25 million fighting with each other to a state and going to donald trump so, you know, he has thought -- he is thinking about what he is doing and he is going to spend a lot of money. how it all works out, i don't think the democratic party really wants him to get the nomination so i think they'll fight him the whole way and then but, if you end up with someone like bernie, well, then, you know, that will be that. >> they're going to fight him every step of the way. so there isn't -- it's -- i hate to say it. but it's embarrassing who they have running because there's not a real outstanding logical democrat the way i was a democrat growing up in the race. >> it was embarrassing you'll hear about that but that's okay. you're honest. >> it is embarrassing. >> thank you >> thank you very much >> thank you for coming. >> you still got it don't you? >> we don't know it's only 6 under. two ahead of you. >> you're ahead of me. you're right >> broaden out the day coming up, more from pebble beach. as we head to break, take a look at the shares of pinterest skyrocketing and giving an update out stay tuned we'll come right back. squawk boxive omeb lfr pble beach returns after a quick break. when it comes to your business internet, which is more important? ♪ ♪ okay, i wish i didn't have to choose. like the more i think about it, the more i want to jump to each room. what if i said you can have it all? ♪ ♪ comcast business gives you connectivity that goes beyond. that's what we want! that's speed, reliability, and security, all from one provider. touchdown! get started with internet and voice for an amazing price. call today. comcast business. beyond fast. more than 31,000 people have fallen ill and despite the low number of cases today americans are still stocking up on face masks and other anti-germ products joining us now is the chairman of the board at cvs health it's great to see you this morning. we had a board meeting and we went through the global response and we had a flu epidemic going on certain parts of the country more than others and since we have 9,900 stores spread across the country we see the early indications when flu is breaking out. and i forget which one it was but a lot more flu cases showing up and there's not a total all out panic button right now but watching it closely. >> have you soon an increase because that's one of the things that cdc and others have been telling people to do. >> we usually start in october and you have an early group of people that do it every year and then as the season breaks out people start worrying oh, maybe i should have one and it's okay to wait as long as you haven't been exposed it's just this year the recipe that they used didn't hit exactly what we have seen but we did see a pick up in cold remedies, flu remedies as well as prescriptions tamiflu was covered and it really doesn't do anything except reduce the impact of the virus because it causes it to shrink the amount of time that you're sick. >> it's a phenomenal product. >> if you take it within 72 hours it takes the ten day flu and reduces it to 5 or 6. >> it's severe and it's like a miracle drug. >> it is i'm surprised that it hasn't been more widely used. >> is it -- can it ever go over the counter do you think >> it's generic now but it still has to be prescribed. >> it's got some weird side effects. >> it can have weird side effects. >> david, let's talk a little bit about the company since the purchase and you're in a quite period and there's some things that you can't talk about. >> we are earnings wednesday and if you look back over the three quarters that we have there's been steady progress along the lines that we said and we got beaten up for it but since that time we have seen a lot of evidence and there's cooperation and a lot of chronic management programs and great stuff and chronic kidney disease and new home dialysis machine and allow people to do dialysis why they sleep if you look at the stock though going back to 2015, it had a lot of pressure. probably not unusual with some of the federal issues that are out there. talk about lowering drug prices. universal health care. how do you see it? >> we have a laugh and a long shot and the most impossible president trump makes an announcement about drug prices and if you avoid it, look at the internal environments and it takes the eye off of the real story which is manage care, retail drugstore, retail clinics under one roof we're changing the front door of health care. we're going to make it more accessible to more people so that your primary care doctor is not an emergency room and $10,000 visit. it's a $10 co-pay at a minute clinic we're going to build close to 50 new health hubs a month in 2020 and that ramps up to about 80 a month in 2021. so we'll end up with 1,500 walk in clinics that you can schedule an appointment on an app and see a nurse practitioner almost immediately. >> you are shrinking your board from 16 members to 13. one of those is mark who ran aetna before why, what happened >> oh, nothing happened. >> the real story is its been too big and it should be smaller. and we took four and we were obligated. and we will increase it with the idea that mark wouldn't be on the board, you know, of his own choice very long but, you know, mark has participated in the board but at this point going down to 13, just imagine trying to schedule board meetings with 16 members. >> and a reminder for you, too, don't miss a cnbc special report tonight. it's called outbreak coronavirus. tune in at 7:00 p.m. eastern time for the latest on the virus and the impact of the global markets. >> coming up, the january jobs report is on the way right at the bottom of the hour and then at&t chairman and ceo randall stevenson right here in pebble beach. stay tuned you're watching squawk box on cnbc how well does your financial advisor know you? 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around the horn. i'm going to go here because you're at the table. so let's start here. >> 160, right? that's what we're hoping for >> what does he say out there. >> 2, 1, 8. >> and the price is right rules? >> pardon? >> the price is right rules. >> we want to go to -- >> oh, absolutely. >> we're going to run out of time. >> they're going to be way above that >> 185. >> and mr. aei. >> 130. >> okay. we're going to her right now she has the jobs report number >> 225,225,000 in january. the unemployment rate up from 3.5 to 3.6 over the year. now job gains for the previous two months were revised upward as well. all be it december up from 256,000 to 261,000 december's number up by 2,000 jobs from 145,000 to 147,000 all told, that is 7,000 jobs more than previously reported and it puts a three month average at 211,000 jobs. the sectors that were driving that job growth in january, construction lead the way with 44,000 jobs added both in residential and non-residential construction health care and the leisure and hospitality industries, and the second straight month losing 12,000 jobs in january the labor force participation right, 63.4% and data shows there was a large number of entrants those are people that previously had been working and they left the labor force and now they're looking for work again their ranks rose by 183,000 in january and the labor department said that is a statistically significant increase finally, the broadest measure of unemployment that ticked up in an all time low of 6.7% in december to 6.9% in january. guys >> thank you i think the winner is rick santelli >> so we'll go through that first. >> price is right rules. i don't think it matters listen, this number has so many interesting things but i'll jump on what always gets me excited, 6.9 of the unemployment rate that's the wider swath went up, however for a very good reason because participation went up and i can't think of a better thing to occur to bring more people into the work force than of course the average hourly earnings year over year of 3.1 that was also solid. the rest of the report, nothing huge, obviously, the unemployment rate ticked up as well but as i said, welcoming more workers in at this point in the expansion is a wonderful thing >> okay. let's get out to jason mr. furhman you were low. >> you can't argue with higher labor force participation rate the higher employment rate that you saw in this, a little bit of firming of wage growth i think the big question though is how much the economy as a whole is going to grow this year we saw it slow for the last two years. the first quarter it's looking set for something like 2% growth how much further can the labor market go without overall economic growth picking up we'll see. >> all right glass half full? glass half empty >> the glass is half full for the month and probably half empty for the year and we're seeing higher wages pull people in which is a wonderful, wonderful thing in an argument to keep the economy running hot. how long that can continue is an important question. >> that's the question i will ask you jason, how long do you think the fed wants to let the economy continue to run hot? >> i think they absolutely want the economy to run hot it's well below it's stated forecast or target of 2% inflation and you're nowhere near that. i think on this show before we have talked about the idea that the primary tool the fed has used is the phillips curve for many years and in many senses the phillips curve is dead for the time being and that's because i think there's more slack in the labor market than any of us really thought possible so you can continue to grow jobs without having a big increase in inflation. >> what's the trade this morning? you're looking at the dow that was off over 100 points earlier. but i'm not sure that we're out of the woods with some of the other more macro issues or some of the other things that may depress economic growth in the first half of the year. >> i think that you are in a perfect spot you're not likely to have to ease which the market is now starting to price in in the second half. you'd have to take the year off. >> i only speak when called upon you know that. >> i just have a hard time believing that north of 200,000 is the run rate of job growth in the country because of a lot of the reasons that were said here which has to do with the availability of workers. jason is right to some extent workers we didn't think were available to be pulled in. i'm not seeing the wage gains that justify your comment. it has a strong report and if that's related to what happened, worst to come. >> it's great. i still believe the run rate or the trend run rate is more 150 to 175 and that's still trong. you would be north of these numbers. >> i would argue that the run rate is even below 150-175 and a big story is going to be the economy returning to the longer term sustainable rates you're going to see i think monthly payroll gains reduced to something closer to their longer term sustainable run rate and that is going to be the story to watch. it's going to be interesting to see how consistent that is with low price inflation and strengthening wage gains. it's a good sign for the economy. you have a high unemployment rate that you need to bring down a healthy labor market is a slower growthrate there's no reason that they have to teeter out. we offset some of the impact of the tax cuts with the trade war last year but to the extent which that's gone that should help. >> hold on guys. >> i want to engage you on the outlook for the fed here i have been not surprised but it's been a big change in the outlook for rate cuts this year i think that's aggressive and it looks like there were two. people were afraid to buy a dip so the world looked way different thursday and friday than monday,tuesday, wednesday and thursday in stocks that's the way we ought to think about fed fund futures it's just a market it goes up and gives you higher percentages. and as for how the economy is going to go, can't wrap my arms around all of these quantitative and qualified formulas that nobody can pin down. we're going to do this we're going to do that we're going to have a lower pace for over a year now. it doesn't make any sense to me. you're underestimating how many we're going to be pulling back in the market. pessimism. here's pessimism we have coronavirus, we have trade treaties that were messy before they were completed and through all of this we're much higher in the overnight rate than the last administration and we continue to grow. >> pessimism always wins in the end. also a programming note. the labor secretary is going to be appearing on the exchange that's at 1:00 p.m. eastern time but i want to get to phil that has the news on ford right now what's going on. >> we have an executive shake up at ford that is not a surprise given the really, really core results that the company posted a few days ago for the 4th quarter. it will be transitioned over to the global president, the group president of sales and marketing on a global basis and he will take over as this company really needs to sure up how it's performing in terms of that in chicago and the president of ford who is in charge of operation, he is out he will now take control of the operational duties and ford is trying to right the ship because it is probability as a service guys back to you. >> thank you for bringing that to us. >> joining us for reaction to the jobs report and much, much more t it's great to see you we haven't seen you in awhile. >> it's great to be back it's back to 210 or 215 and so a year ago i was told that they supposedly know something that's impossible. >> it feels good we went through a period we were seeing it. we were experiencing it. we were investment from our big customers and it started to taper down we attributed that to the china and mexico trade situations. but i'm hopeful that investment picks back up. the job number is very encouraging. we're very bullish in 2020 in terms of the economic outlook. >> when did that start the slow down from your investment >> about a year. yeah. >> the at&t, you know, you transformed the company into a huge media player and some people say oh, you should have stayed, you way verizon does it and just focus on your ps and qs. a year has gone by can you update us on the progress of paying down the debt and the results that you're getting. the stock has done well. >> we came into the year 2019 and we told everybody the number one priority was get the debt paid down so we took on $40 billion of debt to do this deal. and we exited last year. having paid off 30 of the debt check that box we're at 2.5 times debt. we wouldn't start aggressive by buying back the shares we issued to do time warner until 2020 but the cash flow is so strong last year we told the market to expect 26 billion in cash flow we bought back 56 million shares so we're well on our way to retiring the shares that were issued to do time warner and we'll buy back 100 million shares in the first quarter. that's on the way. you'll see us continue to buy back stock and the cash flows and the business are really strong and it's going to be one of the most exciting in the market and it gets launched in may and the outlook is well. >> i read that too and there was news that there may be an episode created but that was not our announcement >> but we did pull in the rights for friends. and big bang theory. so those will be on our streaming platform in may. >> do you like the media business you're from oklahoma i know you i have known you for years. >> i don't know if i'm going to see you out there at the parties. is that going to be something? >> i don't know. you have not invited me. >> will you change your overall persona and go in with the new sunglasses that you saw me wearing? will you go in like that >> i don't see that appening was it confrontational did you lose any sleep over what happened was it positive? >> if you read the letter and this is what i told the guys at elliott is i think that you have identified a good investment we happened to agree with capital allocation margin expansion and some things on the portfolio and we were down the path of executing a lot of this and they had other good ideas so we spent a lot of time together talking about these ideas and actually we came, a mutual mind and the plan that we put in place is a plan that our board had largely agreed to. they really gave me some good insight on communication i probably wouldn't have communicated in the detail their points were valid and it's time to put detail out there in terms of where the capital allocation plan was. share buy backs particularly so bottom line they have identified a new investment and they were right last year total shareholder return up 45%. >> it's going to stay the way that it is nothing -- they're not pushing for anything that could change at this point. >> i made a commitment last year that i would stay at least through 2020 so i will stay as ceo through 2020. >> up to but possibly even longer >> i didn't give any indication beyond that and i have to have that conversation obviously. >> john is doing a great job in your view. >> there's few people that have the business we created like john. >> the ceo of the entire landscape. >> he's a tall guy. >> he has a good perspective. >> that helps. >> so you guys saw last night, we had an event last night where he was interviewing reese witherspoon and andrew wilson and they were talking about where is media going and you saw a guy who has a understanding of the media world and of the communications industry and he's doing a terrific job. >> how many subscribers do you think you need for hbo plus in order to be this is success, this is what we're shooting for. disney came out and said they have 26.5 million subscribers for disney plus. >> so hbo max think of itthis way, hbo is in the marketplace and we have about 30 million subscribers on hbo right now and of them, 10 million are on at&t owned platforms and those will convert immediately at hbo max subscribers day one. the number we put out is that we feel pretty good that by 2025 our number should be about 50 million. u.s. subscribers to hbo max. and if we hit those kind of numbers which we think is imminently achievable it's a real revenue lift and profit lift for the business and it's putting all of this content that we now own and the content production machine that we have over at warner brothers, just putting that content to work on our own platforms. and very optimistic. 50 million as well within are decision to hold back big bang cost the company $1.2 billion. how do you explain that to shareholders and policymakers in washington >> policymakers, the question that we were addressing that i addressed in front of the senate had nothing to do with the shows. >> that's what i was referencing when i said it would be foolish to do something like that. at the end of the day, distribution is what matters now, taking specific programs and saying we're going to use specific programs for our platforms absolutely you should expect us to do that, not all of it warner brothers has an amazing portfolio of content they have a production machine that is unbelievable they're going to continue to sell content to other distributors we will continue to sell content to everybody from netflix to other streaming products, but there is going to be some content that we think will be very important to our own platforms, but again, not channels we won't be withholding tnt from comcast or charter or anything like that. >> randall, can i ask you about comments from u.s. attorney general bill barr yesterday. he said that there may be a point where the american government or american companies and allies of american companies or allies of the united states, those private companies there should be taking a stake in nokia or ericsson, that that would make sense to build up something to compete against huawei >> governments taking positions in private companies to develop private solutions i don't think is a good idea i don't think the track record is very good i think the development is going rather well. i do think some things come out of the white house recently about are there other solutions the industry should be looking at to ensure we're not tied to single providers, software solutions as you probably know at&t has been the leader in developing software to find architecture and the point of that being in simplistic terms is rather than having a vendor who brings you boxes that has software integrated into it, says there's your 5g solution, extract the software layer out, and then you can use anybody's boxes. we have people that are providing hardware into our network today that would have been considered unconventional five years ago because we have done this. we've ex-tracked the software layer out and you can use anybody's boxes. to the extent we do that, we innovate our way out of this competitive quagmire, where everybody's talking about huawei use innovation, software to win rather than government mandates to win >> the net neutrality we're still talking about it >> it won't go away, right >> maybe it finally will, given this latest snap for me, i always thought, you know, if or somebody build out this mullify gazillion network and you need to recoup your capital expenses, don't need price controls what you're allowed to charge. never made sense to me but the world was supposed to end and it didn't yet, now were they hoping this was going to succeed? is it going to end now, now that it's not -- we can put it to bed now, can't we? >> your point is really good when the fcc ruled they were pulling down those tom wheeler rules on net neutrality there was hyperventilation >> he knew better, too >> people were really loud and boisterous, and now what is it, a couple years later, and the circuit court has said we support the fcc's decision they wouldn't overturn it, and you know, nothing has happened in that two years. none of the stuff people thought was going to happen would happen what people have seen are the only places where you're seeing blocking, blocking of content and so forth are in the big tech providers, right and so now the focus has moved to big tech guys in terms of what their practices are, and it's not the internet players. but there's a really important point here, that i think people need to just reflect on. president obama is the president, and the policies move one way at the fcc donald trump, president trump becomes president, the policies move the other way, and this is all a function of having bad legislation, and congress needs to do their job. people need to step up and legislate rules rather than leaving it to bureaucrats because when bureaucrats are writing the rules, depending on who's president, you're having these crazy swings, and so i just really think congress needs to step up, write rules that aren't left to interpretation of bureaucrats and let's get this thing on stable ground >> the supreme court's not going to hear this >> seems like a long shot. we don't know. i'm sure somebody will test it but it seems like a long shot to us that the supreme court would hear. >> you're not saying it's dead and buried yet >> no, but it's highly improbable to me it's dead and buried in terms of what the fcc has just ruled. now, if there's an election in 2020, somebody else is president, we could be right back into this >> wish you had gone to law school now >> absolutely i do not wish i had gone to law school >> the last five years all the court cases. >> i've been to law school the last five years. what are you talking about >> you haven't lost any, i don't think, have you? you didn't need a law degree >> we had a good record over the last four, five years. >> can we go back to huawei for a minute is it a security or competitor threat? >> anything that involves communication you have a security threat. i personally don't think the security threat is the big threat to the united states. it's a big threat to the united states is huawei is doing an amazing job of gaining market share around the world on 5g an if the united states is the only country that is not using huawei in our network, then we have a situation where the supply chain we're dependent upon becomes subscale, and so this is why we think we have to innovate our way out of this. this can be a security issue if you think about what's going to happen with 5g and its hard for people to get their head around this, from autonomous cars to health care systems to utilities to pipelines are going to be managed on the back of these 5g networks. i think our government is ration asking who do we think ought to be underlying the technology chinese companies, should we question and understand exactly who these companies are and what the threats are, when it's going to be used for this inf infrastructu infrastructure >> how far behind are we how long do you think it would be before we could catch up, if you were talking about what the white house is doing with you, microsoft and a lot of other companies they brought in? >> the united states isn't behind i keep reading how the united states is behind right now >> why do we need to do something from the white house directing it >> it gets to this point i was talking about, if the rest of the world is dependent upon huawei and huawei has scaled -- we've not had a situation like this, a country has 1.4 billion people and a company supplying the technology that they can have global scale just on their own country, 1.4 billion people, if huawei gets 90% share in china, they have 30% share globally now if they get share in europe, they get shares -- so we're sitting here in a situation where the united states is at a competitive disadvantage, and so this is why we have to find solutions to ensure that we're not at a very competitive disadvantageous position around the globe, okay? >> just in talking about that, i can't help, i know it's john's role now but i mean, do you sit around talking about whether we'll be a third season of big little lies? is that your life now? and is there going to be a third season of "big little lies"? >> well, you heard the question last night asked, right? i got a non-answer last night. i don't know about you >> can't you tell john what to do still >> it's my wife's favorite show. you think john would probably step up. yours too? you think stinky would step up and say let's deal with this >> i'm glad that guy died in the first season >> he was a bad guy, wasn't he >> he was really bad, that actor. >> that's a great show, we're talking about how bad a guy that guy was. >> all happening around here i was going to ask rece, because she lives to canyon ridge, right down the street, you know that, across the highlands maybe not in real life, i don't know i think we have hans hans has a boring life it's a great company, doing his phone calls. but i think it's cooler to, you know, have reese witherspoon >> i like the business proposition. i don't do cool very well. >> you don't do cool very well i wasn't going to say that but thank you for being with us. >> thank you it's good having you guys out here >> great to be here. >> great doing it. >> that's it for us here in pebble beach andrew, we'll see you soon >> next week >> see you, andrew >> see you "squawk on the street" is next ♪ >> good friday morning welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber at the new york stock exchange. stocks are set to take a breather at the open after four days of robust gains a solid jobs number 225,000, well above estimates, wages strong, participation rate at a seven-year high. contrast that with the manufacturing data in europe, very weak. you see europe across the board. oil is struggling to hold 50 and the ten-year below

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