At this hour, at least right now, there are some modest advances. Germany up by about 14 points. Ftse up by 8 points and in france, the cac up by about close to 10 points. In geopolitical news, we are watching the situation in ukrai ukraine. The Ukrainian Government warns a ceasefire with pro russian fighters would end tonight. If the two sides failed to reach a deal on lastminute talks. Meanwhile, there are reports of heavy fighting around separatist strong holds in the eastern part of that country. Its a situation we will continue to watch. Andrew, right now, baub back over to you. Dupont is cutting its Current Quarter and profit forecast. The company says sales in its agriculture and chemicals unit increased at a slower pace than expected. Nike, posted better than expected quarterly results. The company spent aggressively on marketing ahead of the world cup. Demand for nike apparel and footwear rose. World cup, its the first time nike is sponsoring more National Teams than adidas. Nike used to always jump in at the last minute and do this guerilla warfare marketing thing. I tried to watch yesterday. As you know, we were involved in a move. You were trying to watch in the middle of a move . Yes. The tv was on. We all had lunch together. We had no place to sit. We were all watching eating dominos pizza, believe it or not. But a 10, sort of a hey. I know, i know. I know you picked it, but its not a really exciting way to spend two hours. At the very end, they almost scored. They came close. And i really wanted it i really wanted it to happen. The whole thing makes no sense. Why dont they have why is it not set is up like any other playoff or sports where you lose and just move forward or not . Because it was the group of death just getting through it is a reason to be happy. I like that our german coach, even the german reporters, they would have him a question and he wouldnt answer he wouldnt answer any in german. I appreciate that. So weve got tuesday, its july 1st and if its tuesday, isnt that the old expression, it must be must be, yeah. Isnt that the movie . Is that what it is . Its tuesday, it must be i think it is. And if its tuesday, it must be belgium. 1987. And it is tuesday and its belgium. Also there is a song. Yes. Now, your nikes, are they is there a Michael Jackson centennial fiveyear nike . Is that what you can you no. But i used to do they not have treads so you can move . I used to have a Michael Jackson glove and wear Michael Jordan sneakers. If you said michael you know the difference between us with Michael Jackson, honestly . Its a 20year difference in our aiming. I remember when he was on the some music awards, mtv, and he had just transformed from looking like the little michael to a he did the moonwalk. Grammys, 1984, absolutely. It was phenomenal. It was phenomenal. I didnt know who he was. I was like, this is Michael Jackson . It was amazing. And that album, billy jean. But by the time bad came around, you were in fifth grade and you started wearing one glove. Not all the time. Yeah, i know, but if you did it even in the process a little bit longer while you were then putting on the second glove, it was weird. Did it come with parachute pants . It was the time. It was the time. There were kids wearing mc hammer pants later on in life, too. Tell me, it wasnt a surgical glove . It was not a surgical glove, no. Because then were get intoog a whole if i told you that i made those lines on the side of my head like vanilla ice, was that no, i didnt do that. You told me that was a prosthetic nose, i would be worried. Jackson had no he had like it was a thats the weird thing. Im still scarred a little bit. Its hes a great performer. He was, he was. And he still was worth a company of billion dollars. Hes worth more, unfortunately for him, dead than alive. And i dont know how much blanket or paris or the others are anyway, United Technologies units, sikorsky won a 1. 3 billion contract to develop a new combat rescue helicopter for the airport. Lockheed martin is a key supplier on that project. And in other news out of washington, the Obama Administration announcing it is extending Affordable Housing plan for another year. Jack lew added the administration will use money from treasury Financing Bank to help Housing FinanceAgencies Fund the construction of more affordable rental housing. Meantime, lew adds that the white house is looking for way toes attract more private capital to the housing market. And if you pick up a paper today, let me see, wall street journal are you talking about washington post, usa today, obama lose escort showdown, the tabloids dog bites man no, man bites diagnose on the post. Man bites man. Oh, yeah, with those teeth. You heard what he said, suarez said, you know, these things happen. Three times for him. These things happen. But, you know, it is very competitive. I dont know about biting, but these things happen. And then even i mean, they made it thin. Thats the lead story. The two columns. The main oped in the wall street journal is about this, too. A blow to president okay. They have it, sort of. But 9zip is interesting. All along, these guys have been very activist at the nlrp. The nlrp is now scrambling to revisit hundreds of labor 436 to be exact. The deck is stacked in a recent they went to lunch and he put these guys in here. This comes after the Supreme Court ruled that president obama exceeded his authority two years ago. With reset appointments to the board. The federal agency overseas private sector union organizations, organizing elections and deals with Management Employees and as i just said, 436 cases were decided during that period. All along, as they were being decided, people said depending on how this court case works out, people can come back and challenge. I dont know if it makes a difference right now. They will push through. Theyre pushing to try and redecide all these cases. The odds are they will redecide them in the same way. The big issue is coming in january. What do you mean redeciding the cases . The nlrb is going back and redeciding all of these cases. But the 436 orders but now they cant do anything about it because the senate changed the rules in terms of what you can do in terms of filibustering. The senate is democratically controlled right now. The big deal will come in january, if the republicans take back the senate. Thats the not all the decisions they made, though, right . You can still do recess appointments. But not in the senate is technically still in session. They technically thats fine. But im talking about the 436 pro labor things that theyve done already. Yes. But the democrats control the senate. At this point, theyve changed the rules in the senate where you cant filibuster. They will be able to get new appointments to the nlrp very quickly. And anything that they decide, the repeople will go back and and redecide the cases in the same way. The big difference will be in january. If the republicans control the senate and theyre the ones that have the new rules that the democrat put in place, then it will be a very different situation. Theyre not going to let anyone you know, if they dont need a majority no, the senate changed the rules in the midst of all this. Did you see who which is weird for me with you, sorkin. What is that . Is justices that on the streaming deal. On the area deal. The justices dissented. Where the big right wingers. So you are strange bed fellows with those three on that one, right . You wanted aereo to win, didnt you . No, no. No, no, i you dont want freedom . You dont want to be able to pick up a no, im youre siding with the duopoly Cable Companies . A storyteller n and content creator and, therefore you want to be paid for your content. My content. As a journalist, think about how it affects you. Thats what i always thought to be objective. To hit that. It seems like theft to me. But we asked him the questions. Comcast is a Cable Company would like to not pay but comcast is a broadcast company would like to be paid thats clear. But comcast was the reason comcast was the least effective. I would argue actually, though, even if you take the content piece out, had aereo succeeded, it would have not been good even for the Cable Companies. Ultimately, aereo represented the unbundling of content period. To the extent that you believe bundling ecosystem exists in a certain way and the second you start trying to undo it, i dont know what the unintended or intended consequences are, but it changes the die name iblgs of the economics of the whole probably would have went to ala carte pricing. Right. And i dont know what that would have done to im not sure. I could argue things, we could have that conversation, but we dontny to do that now. Lets talk about a busy week for ipo news. Last night, kraft retailer michaels predicted the ipo came in at 17 a share. Thats at the lower end of the expected range. The shares are set to start trading on the nasdaq today under the symbol mik. Alibaba has picked up the nyse. Its chosen the nyse for that rollout. The chinese internet commerce giant plans to list under the big board under the symbol baba. It could start trading as soon as august. Gopro was welcomed by investors pb closed up 30 on its first day of trading. The founder nick woodman joined us yesterday with his view of the company. People buy solutions, not things, not damages. Helping people express themselves, share their life experience, that is an everlasting Value Proposition to consumers. Thats not a fad. And if gopro can make it easier than any other company in the world, make it edzer for our customers to share compelling professional quality personal content, thats an opportunity thats never going to go away. Is he wearing a gopro thing on his head a lot . No. He just went like this with his air. He has that something about mary is what it looked like to me. Oh, look, there you are. Did you mention with me, you look and you go no, with him, it was pretty cool. I let it go. Because hes young. No. Hes a surfer dude. Hes supposed to have the bed head. It looks to me like hes been wearing one of those things all the time and his hair is now stuck that way. So you didnt even i didnt try and correct it. His wife was there. And she didnt, either . Did she have the same . No. You can see right there. You can see right there, young, no wrinkles, you look cool. Me, i look homeless. There you go. Yeah. Okay. I do correct your hair. I know with him, you were there sitting across from him. It never occurred to me. Really . It never occurred to me. The thing about nick is he is such a handsome man, my wife watched. I think that ratings for women might have gone up yesterday. Is he, really . Let me see. They swoon. Let me see him again. Were going to show a picture of you now. Hopefully that offset me not i have a man crush on him . No. Surfer billionaire king player or something. Hockey players. Any of them, hockey players, all except for weve have to get him in the studio in person. Soccer, all those guys are cool. Anyway anyway, joining us right now to talk more about where gopro could be head sg charlie anderson, Senior Research analyst at daugherty and company. Charlie, the big jump in the stock yesterday, did that come as a surprise to you . No, not really. The deal was way oversubscribed. There were quite frankly many investors who wanted shares would couldnt get any. They probably could have priced it higher. It was reflective of the demand. I guess the question is what happens from here . And maybe that is entirely dependent on their sales and their profitability over the next couple of quarters. Yeah. The they get to the situation where people are going to have to think about this one. I think they are set up for a really good q2. It is their easiest comp of the year. When we did all of our checks, a lot of the stores are pretty clean in terms of inventory. So youre on one hand, you want it to settle in. But on the other hand, theyre set up for a pretty good run here for at least the next couple of quarter hes. Charlie, the question i have about this company is shortterm, clearly, i think theres wins. Theres going to be wins against wins against wins for at least the next several quarters. The question we put to it yesterday is whether the company can ultimately look like the walk man in that other people will make taperecorders too and there will be so many competition. How long you can play out whatever success theyre going to have in the shortterm against what this feels like, you know, the world march is on. Am i wrong . Thats interesting. I think to an extent, its almost happened. If you go into a Consumer Electronics store, youll see a sony camera selling for half the price. Youll see jvc. These are big brands and theyre getting no transaction whatsoever. To nick woodmans point, a lot of it is the brand. Youll see shaun white, the snowboarder using gopro, you see a viral video thats gopro. You didnt see a shot with a sony camera. Its also a very niche market. Just less than 4 Million Units last year, someone like an apple or a google with, that would be nothing. Maybe a month of ipads. But i guess thats part of the question, too, charlie. This is hot, this is hot right now, but we have seen trends and fads that have come and gone. How do they stay relevant . How do they make sure they continue to develop . Do you have faith in their idea that they can turn this into a Media Company . The Media Company is very unproven. The one thing you can say is they have an enormous viewership. They have 2 Million People on their Youtube Channel watching and over 700,000 videos a day of high quality. And in the First Quarter, there were a billion videos viewed on youtube that had gopro in the game. Theres clearly a large dealership. Theres a lot of options with that. I would say right now if you look at the multiples, investors are paying a high multiple, but i wouldnt say theyre sustaining that social media multiple. Its more of a hardware multiple. Where do you come down on the stock . I think its dependent on time horizon, right . Clearly people who are buying it at 31 yesterday, i think will have a very longterm time horizon, believe this is one of the stronger Consumer Brands and they think it will be a much larger stock in the future. So its really dependent of, you know, do you think its a next quarter thing or some something you want on over a number of years . We abovely inclined to it. Okay. Charlie, thank you very much for joining us today. The white house is deeply disappointed by that decision. Doesnt see how these partisan 90 i might say, hey, whoa you guys might have a i might be a little sheepish. That was followed by deeply disappointed followed by the president in no way is considering scaling back his executive actions. Coming up, you want to know just how many people are interested in yesterdays world cup game . We have some telling stats from google, coming up next. Plus, you use amazon to order everything from toilet paper to books. You can add takeout food to the checkout cart and do it all on your phone, i guess. That story in todays executive edge, next. Welcome back to squawk box. This is your executive edge. Googles world cup war room teases trends from the tournaments. Yesterday when it came down to the bites, the player from uruguay, searches for his name and bite outdid searches for mosquito bites, dog bites, shark bites all combined. On that day, i can certainly see that. I also like you know, the more that they showed his reaction to it, its like, wow, my teeth. That guys shoulder, did you see that . Ow. Ow. I think he wanted the ref to call the other guy for, i dont know, putting it shoulder in his mouth. Right up there. Did you search for anything . I was searching. World cup searching . No. That day, i wanted to see what i had and i tried to do it this morning and couldnt figure it out. Buying ad words against the world cup is massively expensive. How expensive . In some cases, it liked like 1. 09. Google, too . No. I went on ad sense and i was playing around to figure out if you could try to advertise against those words. But so many people have they basically auction the words and bid up the words. So each worth is worth more. Whats the normal price for that . Like a penny or no, 25 cents or Something Like that. For an actual click. This looks like its over a dollar right now. Were all learning it together. Is this the knockout round . Now were into that. Is this a knockout round where if you lose youre gone. Is that it . I dont know if they call ate knockout round. Were all learning this together, so we need to be what if we tie belgium . What if theres ties . Oh, no, there are no ties any more. I believe now were into the part of the game where if you lose, you lose and if youre tied at the end, theres a theres penalty kicks . Oh, those kicks, yeah. The penalty no, the shot on goal. Settles games, those arent as you can get them most of the time. Its kind of lucky when the goal does it go to sudden death where you line up and you take the shot . I think they keep kicking. Its stupid when we have no idea how this actually works, but you know what . We have not, as an entire country, been totally on board. This is the new stories all the time that were finally, you know, coming into the you know what . I think who is going to be the beneficiary of all this you know, i think we really like football some some of these other sports cost a lot of money for equipment and Everything Else. To play soccer, all you need is the guys. You know what im really trying to say here. But just about the poorest countries in the world can field great soccer feels. Its taken us longer to get into it. I was going to bring up a business name that i think is going to make a lot of money because of this. Who . Hank paulson stocks owns mls soccer teams in portland. Apparently there was a big article yesterday about how the valuations of all of our own stocks are going to get up. I know that the ones with, you know, whats the name . Arsenal and all those red bull. But i dont know about do you think the u. S. Ones are not going to really i dont know. I think there should be sudden death of all games. This whole tie thing its not as dramatic. Im okay with it if it helps us get to the next round. We lost yesterday and still moved on. We died the last game, too. Tech crunch is reporting that amazon is quietly launching a local takeout service. This would away local competitor to grubhub. That service will initially be part of amazon local, but it shows how amazon is getting into more and more and more arenas. This is the whole idea. Its a true Delivery Company for just about everything and also to me speaks to the issue of what uber could ultimately be in that it may turn out not only to be a car service, but a Delivery Service that can deliver all sorts of things and i can imagine combinations of all these different things. They shouldnt have to pay insurance . Car insurance . You missed that yesterday, joe. We had a debate about whether the uber drivers need to have a commercial insurance and whether they should at the uber level meaning companies levels as opposed to the individual levels. Becky made a very compelling and i would argue sort avenue spirited argument that they need to. They come in and say hey, were going to do things differently. We dont have the same overhead. But you still have to pay the basic things that other insurances do. Insurance is a very important one. There was an accident with an uber car on new years eve where a driver hit and killed a child. And the question was should uber have to pay for insurance even though the guy was acceptable offers at that point but wasnt officially driving somebody . Why doesnt his personal insurance cover because youre not supposed to be operating a business when youre only paying for personal Car Insurance. You have to tell your Car Insurance company if youre then its already doing it illegally if youre operating i think Car Insurance companies would say yes, you are. Same thing as bed breakfasts. Your Homeowners Insurance doesnt cover it if you are renting your house out and using it as business. In that case, did the Insurance Company for that driver, whoever had the personal insurance say they would not pay . Thats my guess. I dont know that for sure. That is the reason that it was elevated to this level where the state stepped in . Well, the neatest thing about all this stuff is we knew the internet would be disruptive, but we never knew that every bit of Spare Capacity could eventually be used. And the productivity gains were if everything is always being utilized and theres no downtime for even your house, your bed, your car i dont want people coming in to use my bathroom. The bathroom and the bed. I was thinking about a bed breakfast. You can her bed bugs and yeah, all kinds of uhh. Anyway, were going to talk more about amazon in the next half hour. Dont miss on sunday night david fabers new documentary of the company, coming up at 9 00 p. M. On sunday, amazon rising. Coming up, were going to talk about the Biggest International issues that could put stocks at risk. Plus, its the weekend and that means its time for the latest edition of the talking squawk blog. Read about the coolest hot ipo in a long time. Find out what joepro looks like. Plus, is it finally the death of the desktop . What it takes to be than france. Were back in a moment. Did you know a tensecond test could help your business avoid hours of delay caused by slow internet from the phone company . Thats enough time to record a memo. Idea for sales giveaway. Return a call. Sign a contract. Pick a tie. Take a break with mr. Duck. Practice up for the business trip. Fly to florida. Win an award. Close a deal. Hire an intern. And still have time to spare. Check your speed. See how fast your internet can be. Switch now and add voice and tv for 34. 90. Comcast business. Built for business. So what im saying is, people like options. When you take geico, you can call them anytime you feel like saving money. It dont matter, day or night. Use your computer, your smartphone, your tablet, whatever. The point is, you have options. Oh, how convenient. Hey. Crab cakes, what are you looking at . Geico. Fifteen minutes could save you fifteen percent or more on Car Insurance. The porter was so incredibly. Careful. Careless. With our bags. And the room they gave us it was. Beautiful. A broom closet. But the best part but the worst part was the shower. My wife drying herself with the. Egyptian cotton towels. Shower curtain. Defined that whole vacation for her. Dont just visit new york. Visit tripadvisor new york. [ male announcer ] with millions of reviews, a visit to tripadvisor makes any destination better. Welcome back to squawk box. Here is michelle ka rooe rue sew cabrera. Here is what to watch for internationally in the second half of the year. Plus, how the situation unfolds in iraq which drives the oil markets, of course. The state of the chinese economy and whether or not the country can maintain its 7 growth for gdp. Third, the outcome of the banking stress tests in europe. These are important because theyre a crucial step for a banking union. Also in europe, whether or not the European Central bank finally undertakes some kind of quantitative easing to combat their fear of inflation. Finally, there are crucial election toes watch for. Turkey in early august, brazil in october. Thats your second Half International outlook. Im Michelle Caruso cabrera for now. Joining us now, scott brown from Raymond James and on set don lufkin at trend macro. Yesterday, where was bullard . Was he on a competing uhhuh. He was . Uhhuh. Because he was a friend of our show. I didnt even acknowledge that he was somewhere. He was somewhere. He was channeling someone. Fist quarter of 2015 . Is that new . No. Janet yellen at her first press conference, she let that slip. Inflation is not just a risk now, its a reality. Every other official measure is above 2 . So you say inflation is a reality. Inflation is happening right now . Cpi is 2 . Sgr we dont need to worry about it yet, right . Youre already at the target and you have not started raising Interest Rates off zero, its something to think about. Scott, what do you think . I dont think inflation is going to be much of a problem here. You look at pipeline pressures, import prices, whatever you want to talk about, theres no real inflationary pressures there. Youre seeing a huge amount of flack in the job market. Youre fought going to see a lot of upward pressure on wages. Inflation expectations, you look at the difference between adjusted treasuries, the market is telling you inflag is not going to be a problem over the next five, ten, 20 years. A lot of it is the same people that were learning about inflation the last few years. Theyve been wrong, theyre still going to be wrong. What about people who have been predicting a recession for the last 2, 2 1 2 year . Are we in a recession and have we been in a recession in the past 2 1 2 years . We have not been in a recession. We have seen the economy expand. We did get a negative report, negative gdp number for the First Quarter. But thats largely inventory, the wider trade deficit, bad wh, a couple other anomalies. The biggest risk i think for the second half of the year, the year as a whole is not that were going to fall into recession, that well end up with more of the same where the economy continues to grow at around 2 , 2. 5 maybe at the top. That would be great if we had full employment, but the problem is were not at full employment. The longer we remain below potential growth, the Slower Growth were going to see. These gentlemen, i had explained calculus about the second derivative, that the rate of growth of the growth might be slowing and thats what weve seen recently. But that doesnt indicate or i can certainly see what theyre saying. You might say well, look at the employment numbers. Look at the Participation Rate and look at the number of people that are on food stamps or disability. You could almost make the case that this is not a were not in a recession, but were in a growth period. Were almost treading water. Is that overstating it . Nowhere else. I think, you know, if we were at full employment, this would be great. But, you know, when you look at the things like shortterm unemployment, the number of people that have been unmroimd for 26 weeks or less, thats around normal levels. Job destruction hasnt been a problem now for a number of years. The real issue is new hiring. Weve been seeing a gradual trend in hiring, getting a lot of anecdotalal reports, that small and medium sized firms are stepping up their hiring. Its a very gradual process, but thats all a very good sign. Now youve got geopolitical concerns which maybe u. S. Firms are going to be more cautious, maybe theyll be more reductant. Weve finally got the same number of jobs, but we have 15 million more people or something. That means a lot of people must have left the workforce for us to be at this unemployment rate. Yeah. Some of that is demographics. You have the aging of the population. So what did we do in the first half and where are we going to end the year . We are no, no, no, don, in terms of the s p. I believe well be at 20,000 within 12 months from now. There will be a porter in 2014, maybe two porters that will be the beginning of a four to eightquarter sequence where we start seeing 5 , 6 real gdp growth. We have not had our business for real . What do i mean real . I mean real with a capital r. 5 to 6 . We have had not had our Business Cycle after we came out of the great recession. The output gap is gigantic. Weve had residual shocks from the great recession. Sure, we saved the great banks in 2008 and 2009. We had to save the european banks twice and the euro twice. We are just coming out of the. Were going to get our Business Cycle back. Hes saying the American Dream would even be alive. Im saying that we have not been in a whatever they officially said the recession was from december 20308 to july 2009, a recession is just ending now. We get our Business Cycle back. When will we get the Business Cycle back . November of 2016 is what the month i was thinking that we might get back. Well be sitting you together in november 2016 and looking back on two fantastic years. Is that the month you think it starts . No. Thats the month i think everything says its obvious. November 2014 . Well be in liftoff. All right. And you see, i think of november 2008 and i look at where the stock market has gone since then. Its remarkable. And who has benefited . Thats what keeps you up at night, isnt it . The market. Its done a lot for the middle class. Surprising, actually, given what i heard was supposed to happen. Really . Its done a lot for the people that needed it. Ben bernanke, they would be in much worse shape if he hadnt done it. Thats the opportunity. When they come into prosperity, thats why you strap the rockets on to this Business Cycle. And the markets go autopsy after november 2012. You dont think you could have come in and gotting 266 . Its all relative. You know who benefits. Dont forget that. You cant argue both sides. We argue both sides every day. I saw more facts yesterday about income inequality. Youre coming around. Now youre a Big Stock Market guy. Okay. Hey. Well, when we come back, hardly a day pass hes without amazon in the news. We would have investors what they think about it after this. I always say be the man with the plan but with less energy, moodiness, and a low sex drive, i had to do something. I saw my doctor. A blood test showed it was low testosterone, not age. We talked about axiron the only underarm low t treatment that can restore t levels to normal in about two weeks in most men. Axiron is not for use in women or anyone younger than 18 or men with prostate or breast cancer. Women, especially those who are or who may become pregnant, and children should avoid contact where axiron is applied as unexpected signs of puberty in children or changes in body hair or increased acne in women may occur. Report these symptoms to your doctor. Tell your doctor about all medical conditions and medications. Serious side effects could include increased risk of prostate cancer, worsening prostate symptoms, decreased sperm count, ankle, feet or body swelling, enlarged or painful breasts, problems breathing while sleeping and blood clots in the legs. Common side effects include skin redness or irritation where applied, increased red blood cell count, headache, diarrhea, vomiting, and increase in psa. Ask your doctor about axiron. Means keeping seven billion ctransactions flowing. G, and when weather hits, its data mayhem. But airlines running hp endtoend solutions are always calm during a storm. So if your business deals with the unexpected, hp big data and Cloud Solutions make sure you always know whats coming and are ready for it. Make it matter. Welcome back to squawk box. The premier of david fabers amazon rising will premier sunday night at 9 00 p. M. Eastern time. Amazon is the most powerful and right now Controversial Company forcing force rather in the Publishing Industry and its tactics have led to a major battle with publishing giant tushed. Joining us now, david garrett. Help us through understanding the many mications of all of this. Should we care . I know its gotten a lot of publicity. But how meaningful is this . Overall, you have amazon controlling about a third of all book steaales in the united sta. Amazon is now the 800 pound gorilla. Even though you have lawsuits brought by the department of justice against apple and the Book Publishers on book pricing, arguably, given the kind of market power that amazon is wielding and what sort of controls and conditions its starting to impose on publishers in terms of giving them access to its marketplace for physical books and digital books, this is something that might merit some investigation at some point in time. I thought the same thing. I dont get the long gain on this negotiation. I understood when amazon initially said, look, were trying to work for customers b we have to squeeze all of our suppliers because we have higher levels margins. But it seems to me this has taken on a live of its own and may actually now, you know, create the eye or at least force the eye of washington to look at them. No . It possibly could. But another way of looking at it is amazon, the stock of late, has been somewhat disappointing to investors. Its been trading below its 200 Day Moving Average for the Second Quarter. Part of this is reaction to the fact that investors were concerned coming off the First Quarter 2014 results. The company was seeing sales growth and bottom lines were disappointing. Amazon has thought to be the Revenue Growth story. But is the company now trying to reposition its to wield greater control and drive its costs down so it could see bottom line improvement and bring shareholders back on board. So theres a bit of a dynamic here to consider. What do you think about amazon . We did a report literally in the past half hour about amazon getting involved in the food Delivery Business . Competing with the grubhubs of the world. We also learned earlier this week that theyre flying what is theyre flying helicopter. The drone. Is no longer going to did you look at all of those projects as well or is this just experimental . Obviously, all these projects, i think, are sort of amazons desire to find new areas for growth. Obviously, going into local food delivery, it may not be as big a business to basically move the needle. The faa is shooting down the amazon drone attempts for at least 2014. Wont necessarily stop the company, either. But i also look at things like the amazon fire, the smartphones they introduced last week. On its own, this is something fought another way to basically drive revenues, probably something on which amazon is going to see a lot initially. The bottom line for amazon is that it had been a flywheel concept, theyre always going the take their cash flow, reinvest in Revenue Growth. Always seeing things slow down and are these signs of desperation . Thank you. Amazon rising premiers sunday at 9 00 eastern time and pacific. It was on the top of my head and i couldnt its one syllable. So if we win, we beat belgium and whoever wins do you know what team we could meet . Brazil . Netherlands. Really . With my luck, we wont make it and netherlands will and the guy will be yeah. Coming up, the fda approving a first of a kind of set of robotic leg braces that can help some people walk again. The Company Behind that technology will join us next. Thank you colonel. Thank you daddy. Military families are uniquely thankful for many things, the legacy of usaa Auto Insurance can be one of them. If youre a current or former military member or their family, get an Auto Insurance quote and see why 92 of our members plan to stay for life. 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For the first time in the United States, a wheelchairbound person will be able to use a special exo skeleton at home, allowing him to stan upright and walk. Larry ja zinski is the ceo of rewalk robotics. Congratulations, larry. And the things that we noted in the intro, a couple of things, number one, there were some of these approved for rehab use in Rehab Centers. This is actually approved for home. And two, its is it just for paraplegic . Is it operated, the control, by some movement in the upper body, like your arms . Its not like mental, yet, where it could be for actual quadriplegic . This initial product is a product designed for paraplegic. We do have some future things for quadriplegic, but its operated by the interface of the person and the machine. They basically control it by moving their shoulders. Its a completely independent device and youre correct. Its approved for personal use, but this is also a clearance for use in Rehab Centers. This is a new classification by the fda, and were the first and only Product Available now in the United States, which is fantastic. Okay, so its the first one approved for both for Rehab Centers and for home use, and thats a new designation that was specific for this from the fda . This is such a groundbreaking breakthrough technology, the fda put a new classification code of exoskeletons in for this. So we are the first it went through a process, the creation of something new, and thats basically exactly what this product is. I can think of a lot of places that still arent wheelchair friendly and that would be if i were that individual, that lady right there, this would be Pretty Amazing for me, i think, in terms of just getting my life, at least, you know, another incremental step back towards normalcy, thats a big deal, larry. It looks expensive, though. Well, youve got to look at it in terms of what it offers, and it probably saves money to the health care system. But this product was really a dream of a man whose remarkable story himself, he was a quadriplegic as a result of an accident, but he was an incredible inventor. And he looked at wheelchairs and said, hey, its 2,000 years weve had wheelchairs, there should be something better. And he created this. So for people who are looking at this, the real benefit is not just walking, its more than walking, its what it can do for their entire life in terms of the Health Benefits and in terms of the quality of life they can live. You talk about the Health Benefits. I suggest just using those muscles again, getting up on your legs, stretching your back, thats what youre referring to, larry . Becky, were referring to that, but in part, it changes the entire bodys metabolism. When your doctor tells you to get off the couch and get some exercise, for someone whos wheelchair bound, thats even more true. What were seeing in the data, in some very highquality centers such as moss rehab in philadelphia or the james j. Peters center in the bronx, it is changing the entire how do you pay for it, larry . How much does it cost . Is it just for rich people . I cant imagine that obamacare is going to pay for this. I think a lot of groups will pay for it. The cost is 69,500. And if you look at the likely savings, this will reduce health costs. If youre injured and have a pressure sore, for example, that has to be treated in an american hospital, thats an 80,000 expense on average. This device will probably pay for itself in about a two to threeyear period when you look at the cost savings. You use less medication. Your body is functioning better. Larry, how many competitors do you have, that may be coming next . I think a lot of people see this as a large market. Theres three or four that are looking at this and investing in it. Were the first and have the most experience, the most data. I think youre going to see several Major Companies for the whole field of the exoskeletons. Its going to be a very significant business over the next decade. Larry, wheres the technology right now for quad and for actually being able to do it with some type of, you know, cerebral input on moving the limbs . Five years away, ten years away . I cant put a time frame on it. I would tell you that we have a device that is a prototype that is being used already for quads, so i dont think its that far away. But right now the control is the users own body. You dont need the brain wave interface for this device. But some day, maybe . Some day, you can have it. But right now, this is contr controlled by the individual. Well all be wearing them when were older, 20 years from now, 30 years from now. I think you can see it. But my point was, an important one, that right now you can walk with this technology. Weve got to run. Just like moving your shoulders. Great, thank you. Well be back. 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Well look ahead to the second half of the year, as the final hour of squawk box begins right now. Good morning, everybody happy friday. Welcome to squawk box here on cnbc. Im becky quick along with joe kernan and andrew ross sorkin. Weve been watching the futures, and there are some red arrows once again. Dow futures are down by about 38 points this morning, and the s p futures are down by just over 5 1 2 points. The tenyear note at this point looks like it is yield 2. 251 . So some additional pressure on yields for bonds at this point. In our headlines this morning, opposite fortunes for two dow companies. Nike shares rising in premarket trading, following an upbeat earnings report. Nike earned 78 cents a share for its latest quarter. That was 3 cents better than expected. It benefitted from a marketing push ahead of the world cup soccer tournament. Dupont, however, falling ahead of the open this morning. The company cut its Current Quarter and fullyear earnings forecast because of slower than expected sales in its agricultural and performance chemical units, especially the agricultural situation. There was less demand than expected for some of the new corn seed that they had, and some other issues there as well. That stock looks like it is down by about 2 . Another stock were watching this morning, manitowoc. Theyre urging it to split its food Service Commitment business from the unit that makes instructional cranes. Relational says theyre operating two incongruent businesses. And michaels is offering on the nasdaq. Its initial Public Offering was at the low end of the projected range. It raised a total of 473 million. The nlrb may have to revisit hundreds of labor decisions. This comes after the Supreme Court ruled 90, that president obama exceeded his authority two years ago with recess appointments to the board. The nrlb decided more than 430 cases during the 19 months that two of the three appointees were seated. The federal agency oversees private sector Union Organizing elections, also deals with management employee disputes. That article in the front page in about every paper. And theres another article on the front page of the wall street journal, saying that credit card lenders are pursuing riskier borrowers again. Cards issued to subprime borrowers rose 39 in the First Quarter, thats roughly one third of all cards issued in that period were to subprime customers. And of course, it raises the question whether were setting ourselves up all over again, jim. Another wave of m a announcements from oracle and General Electric this week, adding to the growing list of billiondollar takeovers this year. And joining us for the next hour or two, dealmakers that have advised on some of the much talked about deals of the year. Blair efron is ceo of center view partners, who is one of the Financial Advisers to hillshires agreement to buy pin kl, and ralph sclausstein is ceo of everycorps and they also advised astrazeneca. And while youve been sitting here this morning, saying that theyre expecting now theyre pushing back. I assume youve been advising on this decision. Theyre going to double their 2013 annual pge sales. Im not going to do the zac efron thing. He sends regards. But i saw them again on the guest list. This is a huge day, because its a friday and Everything Else. And there was that doesnt he hes got abs. But once again, blair efron shows up, and its false advertising. But, no, we have, we have tried to figure out whether we should be excited, guys, about all the m a, and then the other people come in and point to reasons why its happening, that its orchestrated, either by the fed or by ceos that dont want to spend money, so theyre trying to grow through acquisitions. Is it good animal spirit, ralph, or bad animal spirit . Certainly better. Is it inversion animal spirits . Well, thats a factor, but if you look at m a activity, and were just about at the end of the fist half, if you look at the dollar volume of activity, its up substantially, almost 75, 80 versus the same period last year, which was a weak period. However, its if you look at the number of transactions, its almost flat. So the growth in dollar volume is almost 100 in the large deals. Deals over 5 billion. Deals over 5 billion are up about 670 billion, yeartodate. Total transaction volume is up about 700 billion. So almost all you wouldnt really say its just using inflated stock either. Because thats not the case. No the fed could be controlling that too. And also, i think its, joe, its very symbolic of ceos, looking at risk reward ratio generally, and saying that the risk side of the macro equation weve been talking about for a long time is its still there . No, actually, less on the risk side, not that the reward side is expanded dramatically, but they can feel more certain that whether its talking about bank balance sheets, whether its talking about the political environment, that you can actually plan with a bit more certainty over a coupleyear outlook. And thats getting ceos to say strategically, what should we be doing with our company to preserve but does that mean that its so its not in lieu of plant equipment and long, 20year investments . No. Its not in lieu of that . We had kevin worsch on the program yesterday. He made the argument that m a. Investment is not the healthiest. But at least in the shortterm, youre not actually seeing it grow the economy. If anything, it might shrink the economy. So, i would tell you that its actually been, and i think youll see this, andrew, the next several quarters, as much as anything, Capital Allocation is going away from buyback, going away from dividend, which is always symbolic of companies when theyre more focused on risk, saying, well do what we know best. So the idea, becky, that youre going to more of an m a measure says that ceos are planning for the longer term. While it may have, in the shortterm, some impact, company dependent on jobs, for example, if you are doing something that creates a more sustainable, more Healthy Enterprise longterm, presumably, thats what will lead to growth. And jobs. And almost all of the transactions that are occurring now are strategic transactions, in the business that these companies are in. And theyve been on the drawing boards in many cases for one, two, three, and even more years. Those types of transactions have always been, in the short run, caused some a little bit of job loss, because of the expense takeouts. But they do create healthier, more Competitive Companies that create jobs in the long run. They say its strategic. Like pfizer said, this is strategic. Just a coincydink that its but it certainly juiced it with the inversion. A couple of the big deals that weve talked about wouldnt be happening without it. So thats why people think that its kind of i think inversion, joe, frankly, is a very big issue. You had almost 50 invergents done, particularly in health care. Were seeing a trend that modification will go beyond health care. And the question is less about, should a company do it or not. Its hard for a company to say it wont, when it has competitors that have an advantaged tax position. The bigger question is, coming up with a tax code that and a territory. But assuming it doesnt get fixed, which i dont know if you think thats a big assumption or just baked into the cake. Assuming it does not get fixed in the next two years, are you a fan of what people like carl levin and others have suggested, which is, lets bandaid this temporarily, because once you let once the tooth paste is out of the tube, its hard to get it back. What ill tell you is this, andrew. I, personally, and everybody is different, i am concerned if we dont do something to fix this, you will have its not only the tax base, youre worried about the intellectual capital base leaving this country and going overseas. So i appreciate that any time you do a bandaid, theres an unintended consequence, but more important, we cant have our best companies feeling that they have to do this. And frankly, i understand why they feel that way. If you were a doctor and you knew that you had a remedy that actually attacked the root cause of the ailment, versus something that is paltive. I would treat the root cause. But you dont have any influence in this. You know it cant be done, because theres no we would and im sure blair would agree with this. You have a lot of sway here. Nobody has any sway. Ive got great your hair looks like it merged with someone elses. Theres so much up there, it looks like evercorps arranged after i turned 60, it seemed to start growing in more. Thats weird. It really is. And you didnt do anything . Nothing. I dont believe in that. But what were you going to say . Then ive got to ask i was going to say that, and im sure blair would agree with this, the argument for Corporate Tax reform in this country is stunningly strong. Theres agreement, i think, on both sides too many sacred cows, though. Well, no. Broadening the base, lowering the rates, is a compelling case. And its just getting the republicans and the democrats to Work Together in washington, that we just cant do right now. And the spate of these inversions is a symptom of that problem. But i will tell you, ralph, i think you would say the same thing, the megaphone around tax reform is getting louder on both sides of the aisle. I know. Which is actually not a bad thing. Getting this more in the forefront. Were all about the same age, who change if you had to pick someone that changed your life, who do you think it would be . Im going to show an age difference here, if you had to pick someone. Jfk or something . Well, jfk, everybody of my age, i remember exactly where i was when jfk was shot. I do too. Next door at the mackeys. And in fourth grade, when he was running for president , i actually got excused from school for two days and i got to hear kennedy give a speech and i got to hear Henry Cabot Lodge give a speech. It was the Vice President ial candidate. Got anyone . Ralph sclausstein . Ralph number one, and a Great High School teacher in history. This is a setup, you should know. Im sure it is. Would either one of you come up with Michael Jackson as having changed your life . Only because i talked yesterday. Did you see somewhat someone sent in . You cut an album, too bad to fail. Look at that, they put you in a leather jacket. When i was in fifth grade, i went to a Michael Jackson concert and thought it changed my life. I thought he was magnificent performer. We were talking about him on the 50year anniversary. You said you were wearing one white glove . People remember that theres sorkin, hes wearing one glove again. Hes talking about his High School Teachers and right and jfk i said mlk. You come up with im trying to think of the things i remember from my childhood. I remember michael dukakis. You have never said you have never said anyone else changed your life. You were in a tank with him, werent you . Yeah, thats right. In the tank with him. Were going to continue this conversation in just a bit. When we come back, the outlook for airlines in the second half of the year, former continental boss, gordon bathune. And its the weekend. You can read all about the coolest hot ipo in a long time find out what gopro looks like. And is it finally the death of the desktop . Also, what takes to be stupider than france. Right now as we head to a break, take a look at yesterdays winners and losers. E financial noise financial noise financial noise financial noise welcome back, everybody. Weve been watching the futures this morning. And at least right now, it looks like there are continued red arrows. S p futures are up by just over five points. And the nasdaq is down by almost six. In our headlines this morning, Norfolk Southern is seeking customer Legal Protection from older tank cars. The Railroad Company wants Legal Protection against damage caused by explosions or leakage of Hazardous Materials carried in the older tank cars. A series of accidents on rail tank cars carrying crude oil in recent months has put the industry under scrutiny. I think the way it works in that industry, is they are required to carry any of these Hazardous Materials. They cant say, no, were not going to carry it, but then as a result, theyre also held liable. All day on cnbc, we are looking to help you position your portfolio for the second half of the year. Heres cnbcs phil lebeau with a look at what to expect from the airline industry. Reporter heres what to watch for in the airline sector, in the second half of this year. Higher jet fuel prices are likely to put a little more pressure on the bottom line for airlines, and that means Airline Stocks could be facing a little more pressure themselves. Also, expect more attention to be focused on niche startup airlines, like people express, which will be flying limited schedules. Finally, for the legacy airlines, southwest will be flying internationally for the first time in the second half of this year. And other carries, like jetblue, will be expanding their offerings when it comes to coasttocoast flights. Thats a look at what to expect in the airlines. For the second half, im phil lebeau. Thanks, phil. Lets bring in Gordon Bethune into the conversation. A cnbc contributor. Good morning to you, gordon. Your outlook nice to be here. Nice to see you. Your outlook for the rest of the year and specifically where you think fuel prices land and how thats going to impact the bottom line. Well, i think phils concerns are valid. Obviously, you price the fuel, and theres always a lag, so theyll catch up, but fuel will be a continuing pressure on the cost side of the business. But that will get price for in the end. I think theres modest growth in everybodys portfolio. So i dont see anyone doing anything stupid, that will really cause revenue to fall. Well, your former company, now part of the united, how do you look at them right now . On a relative basis, in terms of comparing them in terms of market performance, they have not theyre not necessarily in the same league with delta, lets put it that way. Well, theyve had a tougher time of it. Of course, they didnt delta was an acquisition. This was a merger and you have all the political and social issues, but theyve got the route network. And theyve got the fleet to be really successful. Theyve got the most modern fleet and probably the best network of any of the carriers. So i wouldnt bet against of the biggies, who do you think of as the winner . Well, right now delta is clearly ahead, because theyve got their game together. Theyre really smart people over there. And theyre playing hardball, which is what you would expect. For potential, americans coming on with some new management. Youve got a breath of fresh air out there. And united is a great company. And then southwest. So youve got four really Good Companies with a majority of the traffic, maybe more than 80 . Thats why its going to be stable. Were not going to have stupid things. Gordon, jeff at united, that was worth doing, wasnt it . But really hard to get those to mesh. Are they done . Well, i think so. At least directionally, joe, theyre done. It was a difficult deal because the way it was constructed. But jeffs made a lot of progress, youve got to give a guy real good credit. It was worth it, right . Thats your worst you did it, youre still proud and happy about what happened with continental, right . I think, you know, i would have they paid a high price. But it was worth doing. I tried to do it and i couldnt get it done. They wanted to run the company, and i said, you couldnt run water, so i wouldnt ever do that. But its just, the price was high, they paid the price, and theyre working their way out of it. And when its done, i mean, done, it will be do you remember when we used to talk about the people running delta. And we used to i mean, anderson is like, you put someone in that knows what theyre doing, it makes a difference, doesnt it . Absolutely. Why didnt the mckenzie guy, he was such a great consultant, why didnt he thats unbelievable the way that company was run back then and the way its run now. Now youve got macgyver running it, richard dean anderson. Anderson is the best in the business. If you hire mckenzie, you get things like song and lose a couple of billion on a dumb idea. I think you should hire smart people, dont hire consultants, hire your own. Gordon, real quick, jetblue, this new strategy of Business Class, does that make sense to you . Absolutely. They were losing a lot of highend traffic because that coasttocoast is a long haul, and they were getting defections, because youve got two other big boys, american and united in that market. So gordon, before we let you go, we have a very important question. The most important question what about screaming brats. This is a serious question. Business class, transcon or international, kids in first class. Tell me about the decision, as an Airline Leader throwing up, you know. About whining, crying, screaming what about that . Well, Business Class is obviously what most corporations authorize for their people to travel on long haul. Very, very few people can afford first class, whether theyre a company or out of their own pocket. What you do is you make Business Class like continental did, business first, and make it so much like first class, that you get the people switching over, because youre Business Class. But what about kids in Business Class . He doesnt want kids to be allowed in first class or Business Class. Thank you, gordon wait, wait, wait. Gordon just laughed out loud. Whats the temperature down where the dogs and cats are . An infant could survive that, couldnt they . Absolutely. Its the same conditions in the plane. A little cage. If youre going to be advertising that people get to sleep and do work, why have 2yearold infants next to them . Why have what . Im sorry. 2yearold infants. Is an infant 2 years old . Just like becky was talking about the trains couldnt refuse to carry stuff, a public air carrier cant this is a citizen and they have rights. Cant they bring back steerage. Thank you, gordon put them back in coach with all the dregs that have no money. Gordon, thank you. Fit makes you feel better, today im off to aspen for this aspen ideas thing, but 15b, coach, in the middle seat. I hope you have kids on either side of you. I hope theres two kids screaming at me the entire time. We need you to come back and talk more about this stuff. Well put you in the wheel well. See if you can coming up, from airlines to the broader markets put you on the wing. The outlook for stocks in the second half, still ahead. Time now for todays aflac trivia question. How many times has a host country won the world cup since it started in 1930 . The answer when cnbc squawk box continues. Aflac so this is who you brought to help us out . Oh yeah, hes the best. Hmm. He doesnt look like hes seen a tool in his life. Oh, he doesnt know anything about tools. Aflacacacacacacac but when i broke my arm, he lent a hand. He paid my claim in just four days. Four days . Wow its no accident aflac pays fast. Find out how fast at aflac. Com and remember,accidents dont hurt as much when you have aflac. Better. In a we believe outshining the competition tomorrow requires challenging your Business Inside and out today. At cognizant, we help forwardlooking Companies Run better and run different to give your customers every reason to keep looking for you. So if youre ready to see opportunities and see them through, we say lets get to work. Because the future belongs to those who challenge the present. In india we have 400 Million People who dont have electricity and i just figured that its time i do something about it. What were doing right now, along with ibm, is to actually transfer data through a satellite from our wind farms directly onto the cloud. I think we could create a far more efficient system across the whole network where we could actually draw down different kinds of energy based on when its needed by the consumer. A smarter Energy System is made with the ibm cloud. Now the answer to todays aflac trivia question. How many times has a host country won the world cup since it started in 1930 . The answer five. No, no, no. Welcome back, everybody. Lets get more on the markets and dive a little deeper into the Ripple Effects of Central Bank Policies around the globe. Joining us right now is mark haitily, the global ceo of ubs wealth management. Thanks for joining us. Thank you. I guess the biggest thing thats happening, when you are looking around the globe at different markets and how they plans off of each other, it has to be what the ecb is doing right now compared to what the fed is doing. Thats a big difference in central banking. Yeah. I mean, the fed is starting to taper, while the ecb is signaling that its going to continue to ease. But look for investors over the next year, weve got to get this move from the fed, back to the fundamentals right. But maybe over the next six months, you know, janet yellin came out last week and said, were not going to worry about inflation, were going to continue on the path we have, which is ultimately still stimulative for risk assets. Thats why were still long equities in u. S. High yield. What would make you start to think, this is a cautionary flag, this is a time i might want to shift my positions. Well, as you guys have highlighted this morning, weve got to keep watching oil prices, right . Because that can rear its ugly head at any point. Through the ukraine crisis and now through iraq, what were doing is were looking at that price, and if we saw a sustained rise, say, another 10 , then wed get concerned that this could interrupt global growth. So, 10 isnt much pip mean, youre talking about less than 120. Yeah, but were talking on a more sustained basis. When we look at these things, you know, kind of these geopolitical crisis that last for short periods of time, weeks or something, ultimately dont have the impact on the underlying economic fundamentals that really make a difference for our investor over, say, a sixmonth period. Mark, weve been hearing for maybe the last six months or so, that things are better in europe than you might have expected. That the case for european stocks, at least, is a better scenario. Would you agree with that . We would agree. And the reason is, theyre coming out of a recession, right . We kind of forget that a little bit in the United States, because we came out of the recession so long ago. Were looking at about 1. 1 growth for european stocks and as we see that uptick in the Economic Growth, we think theres a lot of room for margins to expand. And we think european stocks can do about 10 epps growth this year. What about the situation in japan . I mean, their central bank is pretty active as well. Exactly. That we see that as something that can help as a global stimulus, but that market is very volatile. We tend to want to spend our risk budget right now on the u. S. And europe, where we think that youve got the stimulus in effect, but you also have surer footing, that theres going to be the kind of support we need to see the Economic Growth thats sustained. How do you break that down . Do you like u. S. Stocks . European stocks . What would you suggest to break down the portfolio be . Overweight u. S. Stocks. Overweight european stocks. What is it depends on the portfolio. But, i mean, we have a risk budget, so it depends on the portfolio. Several percent overweight, and then we would be underweight on the uk, because many of the earrings for the ftse 100 companies, they actually come out of europe. So when it trickles down to the earnings in the uk, theyre hurt by the stronger pound. So thats how we balance out the equity portfolio. Okay, mark. Thank you for joining us today. Thank you. When we come back, french banking giant, bmp, slashing its dividend. Well have the details right after this. And find out what the three highest paid coaches in the world cup have in common. [ girl ] my mom, she makes underwater fans that are powered by the moon. [ birds squawking ] my mom makes airplane engines that can talk. [ birds squawking ] my mom makes hospitals you can hold in your hand. My mom can print Amazing Things right from her computer. [ whirring ] [ train whistle blows ] my mom makes trains that are friends with trees. [ train whistle blows ] my mom works at ge. My mom works at ge. Ameriprise asked people a simple question in retirement, will you outlive your money . Uhhh. No, that cant happen. Thats the thing, you dont know how long it has to last. Everyone has retirement questions. So ameriprise created the exclusive. Confident retirement approach. Now you and your ameripise advisor can get the real answers you need. Well, knowing gives you confidence. Start building your confident retirement today. Welcome back to squawk box. In the headlines, bnp is reporting to slash its dwebds. Dow jones is reporting this is in conjunction with an expected announcement next week that it will settle with u. S. Authorities by paying up to 9 billion. Bnp is expected to plead guilty to charges including violations of u. S. Sanctions. We should talk to you about that. Its like a third rail. United technologies, of course, an aircraft unit and its supplier, lockheed martin, have won a 1. 3 billion air force contract. Theyre going to supply a new combat rescue helicopter in a deal that could eventually be worth up to 7. 9 billion. And atlantic city, new jersey, may be losing one of it longtime casinos. According to a union official, the showboat casino, is planning to lay off employees and close later this year. Show boat is owned bizarry caes entertainment. You know i get sad about things like this. I dont think you really care if show boat gets shut down. Too down market . Screaming babies. At the black jack table . More of those people you do agree that babies should not be at the blackjack table, right . Thats because they cant be in the liquor cant be at the bar. People now think im the one that doesnt like the coach riders . They do they havent been watching im the one im talking about. Are you channeling . You cant win. The u. S. Mens soccer Team Advances to the knockout round of 16. They lost one to germany, really close, at the end, i thought there was a head what do you call it . A head strike. It just went over. Do you even wear helmets . Eventually, when their heads crack like that, its scary. But a win against ghana and a draw with portugal earned the americans enough points to move on to the next round. And an interesting note, teams run by tournaments with the three highest paid coaches, russia, england, and italy all failed to advance. And for the curious, the u. S. Coach is the tenth highest paid manager in the tournament, making 2. 6 Million Euros . No, he makes dollars, but probably converts them does he live here now . He has to live here, at least yeah, at least for most of the time. Do you guys know how is this the knockout round . If you lose youre gone, right . Right. And if youre tied at the end, you do those kicks . How many do you get . Go to sudden death . You go to sudden death first kicking back and forth until somebody scores. Sudden death in score could last then you do penalty kicks. I think they should be doing that from the beginning, though. I think this whole system with the ties, it doesnt make sense. The penalty kicks arent so its like in hockey. Almost like 50 50 theyre going to make it, right . I dont know what the exact percentage is, but its pretty high. Seems like a crumby way to win, really . I think it may actually even be higher in soccer than it is in hockey. People might say that about tennis, too, when you get to that final because there are certain times where they dont allow the tie break in tennis, right . Wimbledon. Which is going on now, already . Yeah. Were in the middle of it. I think the reason they do the tiebreak kick the penalty kicks is that the players are so exhausted at that point, that they could get hurt. And theyre playing in the amazon rain forest down there with 100degree over 100 humidity. Which is what, i guess, squawk box, 110 . When we come back, we have a special edition of our change the world series. Gordon gund is on the boards of kellogg and corning and the former owner of the Cleveland Cavaliers and the san jose sharks. He cofounded the fighting blindness, to fight conditions like the one that took his vision over 40 years ago. Gordon will be joining us on set, after. Means keeping seven billion ctransactions flowing. G, and when weather hits, its data mayhem. But airlines running hp endtoend solutions are always calm during a storm. So if your business deals with the unexpected, hp big data and Cloud Solutions make sure you always know whats coming and are ready for it. Make it matter. Welcome back, everybody we do have a special guest with us, as part of our change the world segment this morning. Gordon gund is the chairman and ceo of the foundation, fighting blindness. Hes also the founder and ceo of Gund Investment corporation. Hes a former venture capitalist and both a former nhl and nba professional sports franchise owner. Gordon recently announced that he would be matching donations to his foundation, with the goal of raising 100 million for blindness cure research. This is a cause thats very personal to him. He went blind more than 40 years ago. Gordon, we want to thank you so much for coming in today. Well, thank you. Im glad to be here. Its great. Lets start off talking about your own story, about why youre doing this. Sure, i lost my sight to a disease called retronitis p pigmentosis, and when i did that, there was nothing going on in the way of research, there was no way to stop the progress of the disease. It was a very frustrating experience. And when my sight was finally completely gone, my wife and i thought, well, were going to commit ourselves to trying to one day make it possible for people who are diagnosed with one of these diseases, not to have to face the same frustration that we did, ending in blindness. You traveled to odessa at the time, just trying to seek out any sort of experimental treatment. There was very little basic science going on, very little understanding of the retina or the causes of these diseases. So you try anything, when you get to that point. And we did. I did. I went to russia. Of course, the treatment didnt work. But by the time i came back, i was fully blind. And thats when we started just, within a year, the foundation, fighting blindness. Lets fast forward to today. Where are we in terms of the science . What can be done with some of these degenerative diseases of the retina . Well, its hugely exciting. The foundation, fighting blindness, is the leading funder, worldwide, of these diseases. And the diseases include, will affect more than 10 million americans alone, and many times, that number around the world. There are diseases like retronitis pigmentosis, usher disease, and agerelated mackular degeneration, which is the leading cause of blindness for people over the age of 55. So what we set up to do was first of all, build a knowledge base, which fortunately weve done, still more to go, but now there are therapies emerging from the laboratory, were moving them to the clinic. There are 20 Clinical Trials going on. Its amazing, in things like gene therapy, in stem cell therapy, and in other novel therapies like bionics. Were responsible for the funding of the technology that led to the artist 2, maybe youve heard about it, a bioennic eye, that actually is an implant in the retina, and is just doing helping people who are blind a lot. How does the bionic eye work . Its implanted and help people who couldnt see before see . Yes. Right now the number of pixels is not as great as it could be one day. And now they can see light and curbs and doorways. But the people who are using it now. But its not it hasnt advanced to where one day, it will be very effective, i think. Gordon, other things that have helped, that just increases blood flow, doesnt it . Its sort of or vascularization or something. Well, it reduces vascularization. Reduces it . Yeah, you know, it really so it eliminates so so much vascularity that it blocks out the yes, precisely. I see. Why is it so hard why cant you do a retinal transplant . Why is that impossible . One day, i hope for that. And of course, the thing in the meantime that we really that researchers are working on right now is building a whole new retina out of stem cells. Stem cells. But i thought that would be like a transplant. Youd put it on right. Exactly. And some day, well, theres work going on that looks very promising in the models. As you know, youve got to prove it first in small animals and then larger. So you have both copies of a recessive gene. Th is that how that works . If its recesssive, there are three types. And we run the gamut. And is there a what causes the degeneration is a missing protein or something . Can you add the protein back and at least delay thats a great question. Because what we have done, and you can do that. Ultimately, therell be a lot of that, i think, and were working on it. But now you can add back the gene, the actual gene that produces the protein. So its called normal gene replacement therapy. And you can actually get the normal gene into the rods and cones. It produces the protein that the defective gene doesnt produce, and its like turning on a light switch. And you only need it once, probably . Yeah. Well, so far one of the reasons were so excited about why this is and why were doing this, and have put forward this match, is because we have a Clinical Trial with gene therapy for a disease that affects young or people or infants that are born blind or go blind very early. And they have this treatment, which has now been done for more than 50 children and young adults. And in every case, theyre blind before and they gain significant amounts of sight. One boy even plays baseball. And thats just for kids is it because theyre young and well, its because of this particular genetic cant do it in adults . Ultimately, im sure. Realistically, how long do you think we are away from truly curing this . Because theres so many diseases and the foundation, fighting blindblindness, is comd to curing them all. I think well have a number of we already do, the fda will be approving, im sure, this trial thats in phase 3 and looks really promising. Thats going to happen right away. There are other gene therapy trials. There are several stem sell trials. So, its really, its a transformational time in this field. Were going to get him his vision back. Well, lets hope. It just i dont understand why the retinal transplant is not something thats possible to do right now. Well, i had an actual transplant. Now, stem cells are one thing, but an actual transplant, i had an ophthalmologist and a basic scientist tell me, there are millions of nerve endings that are tied to the back and youd have to youd have to hook every one up. We cant now i see. That doesnt make sense. So youd have to grow another one, with stem cells. But the reason for the match is to get, really, jump start this whole effort, and get it moving. But the retina is actually an extension of the brain, i guess. Yes, it is. Very interesting. Thats why a lot of the work were doing, and now there are optics available, that can allow you to see the cells of the retina, the other layers of cells, and you can see the individual cells. So if youre treating these cells with a gene that you were or stem cell therapy, whatever it is, you can see, whether or not, it makes the cell more healthy. And a lot of people that are in the field of neurology are learning a lot from what were doing, from other neurological diseases. Gordon, we want to thank you very much for coming in. Well, thank you. Our match gift is available online, blindness. Org, the Foundation Fighting blindness. Were grateful to anybody and whatever their capacity, but well match gifts of 25,000 on a dollar for dollar basis. Blindness. Org. Thank you. Thank you becky. When we come back, were a week away from jobs thursday. What to expect from the june employment numbers. Plus, a little bit more about deals too. Were back in a moment. Yeah, girl you know, ive been thinking about us and, uh, i just cant fight it anymore its bundle time bundle mm, feel those savings, baby and thats how a home and auto bundle is made. Better he learns it here than on the streets. The miracle of bundling now, thats progressive. Take a look at stocks to watch this morning. Nike posting better than expected quarterly results. Demand for apparel and footwear rose in north america and western europe. And its a dow component. Dow component. Drilling into that into my head. Thats a dow component. Thatll help the dow today. I cant remember that nikes a dow comment. How about phil nike creates a company thats the Worlds Largest apparel maker. Dupont is cutting its fullyear profit forecast. Sales in its agricultural and chemical performance unit have advanced at a slower than expected coast. Lets get back to our guest hosts, blair efron and ralph schlosstein. We teased this, but i want to get back to the deal making stuff. Just briefly on the jobs stuff, what are you actually expecting . The number, who knows . 53 months in a row of increased employment, 200,000 jobs average. No reason to think, frankly, more of the same. And you know, optimistic. I agree with that. Where are you guys on we had kevin worsch on yesterday, about the fed, and where we are. He made an impassioned case against what the fed is doing. Where do you guys sit on that issue . Look, first of all, i think the fed is path dependent and economic results dependent. And i think, you know, a year ago, i was on the show and we talked about papering and there was all this sturm and drong about that. And i said, basically, theres two outcomes. One, the economy is doing better and the fed tapers, or two, the economy is not doing well and the fed doesnt taper. Theyre both pretty good for markets and for the economy. The first is better. So, i think pulling away this artificial stimulus, gradually, as long as the economy can support it, is the right thing to do. But i think the fed has been very clear, if the economy isnt strong enough, theyre going to keep it there. Do you look at these ipos, and weve had a string of them now, as supportive of a great economy or even a good economy . Kevin made a very interesting comment yesterday, and said, look, these are loser ipos. These are not strong ipos, not strong companies, its not representative of anything. I disagree. I dont want to overstate what he was saying. I heard the comment and i disagree with that. I think that its emblematic of increasing entrepreneurial enterprise. These are companies that, for the most part, started five, six, eight years ago, and theyve built them to a point, profit aside in many cases, where theyre real Business Models. And obviously, a lot of them will not necessarily be durable, but i expect many of them will. And the idea that you have a strong ipo market is more important in terms of the notion of overall confidence, in terms of where we are with the macros. Capitalism is about creation and destruction. And if you look at any decent ipo market, there were companies that became incredible companies, look at a company like amazon, and then there were companies that just fell by the wayside. Blair, ralph, thank you guys for joining us. Have a great summer. Hope to see you again soon. Thanks. When we come back, well be talking tech m a, go pro, and talking more with the managing partner of andreessen horowitz. And biochat is a messaging app that works when your phone doesnt have a signal. The ceo of the startup will be joining us right after this. Kid hey dad, who was that man . Dad hes our broker. He helps look after all our money. Kid do you pay him . Dad of course. Kid how much . Dad i dont know exactly. Kid what if youre not happy . Does he have to pay you back . Dad nope. Kid why not . Dad it doesnt work that way. Kid why not . Vo are you asking enough questions about the way your wealth is managed . Wealth management at charles schwab. Hammer that in. Nice. Wrench . What . Aflac so this is who you brought to help us out . Oh yeah, hes the best. He doesnt look like hes seen a tool in his life. Oh, he doesnt know anything about tools. Aflacacacacacacac but when i broke my arm, he lent a hand. He paid my claim in just four days. Four days . Wow find out how fast aflac can pay you at aflac. Com. Better. Tech talk from go pros ceo, well hear from andreessen horowitz. A contract dispute could mean trouble for west coast ports. Shut it down shut it down were going to tell you how a shutdown would impact retailers nationwide. And then, meet the brad pitt of the republican party. Its a pleasure to meet you. Stewart mills, whos running for congress in minnesota. Now you know who youre fighting. Well ask him about the closely contested race and the Biggest Challenges ahead for the gop. Is it a cat . Yes as the third hour of squawk box begins right now. Welcome back to squawk box here on cnbc, first in business worldwide. Im joe kerner along with becky quick and andrew ross sorkin. The music, what is it . Its friday, youve been looking at me, ive been looking at you. Its friday. U. S. Equity searches are it was kind of offsetting the gains we were seeing in nike in terms of the dow. We are indicated down about 24 points. I thought yesterday didnt look that bad. It looked like it was going to start selling off a little and it pared those losses. And you know, you get Economic News like minus 3 , the markets done pretty well. Weve been up for a long time. A slow, steady it still makes you wonder how much we still like the fed being in. But they saw that number, and immediately wanted to make it clear that this wasnt going to this was a oneoff and its not going to change our intention to commit all this accommodation some day. And bullard but hes been that way for a while. Hes always, more hawkish than some of the others. So him saying First Quarter hes not voting anymore, is he . No, hes not. Lets take a look at our headlines this morning. Bmp reportedly plans to slash its dividend and sell a multibillion euro bond next week. The wall street says the move comes as the bank takes steps to settle a u. S. Investigation into alleged violation of sanctions. In other news from overseas, the Ukrainian Government warns the ceasefire will end tonight if the two sides fail to reach a deal. There are reports of heavy fighting around several separatist strongholds in the eastern part of the country. And in the United States, corporate news, two dow components moving in heavy trading. Earlier, we were talking about this a moment ago with joe, dupont is cutting its Current Quarter and fullyear profit forecast because of sales in the agricultural and Performance Chemicals units, both of those falling short. Agriculture was the big problem, and that stock looks like it is down about 2 and thats a decline of almost 2. 9 . In the meantime, the other dow component, nike, is getting a boost. Earnings beat the street, driven by strong sales of apparel and footwear in north america and western europe. That stock is up by about 3 . Were going to talk tech right now. Our next guest has a hand in running one of the valleys most powerful vc firms. Joining us is scott cooper with andreessen horowitz. We saw you in person just a couple weeks back. I want to get your views, really, now, its day two of the gopro ipo or a day after the go pro ipo. And when you think about that company. Is that a Hardware Company, a Software Company . And you know, i sort of said, is it the next walkman or is it the next, i dont know, what would be the next great thing. The walkman is something you probably wouldnt think of as great. They had a nice tenyear run. What is it . I think its actually embl emblematic of a resurgence of hardware wii seeing generally out here in silicon valley. And in the gopro case, theyve taken a piece of hardware, and then this idea of, can we build a community arenound it and essentially monetize the community. So its a different Business Model in many respects. But the thing were seeing outside of gopro is a combination of hardware and software, where the software is differentiation for these products. So think about occulus. The parts that occulus is building are really just mobile phone parts, is what the hardware is, but the intelligence is in the software. Thats the biggest trend were seeing out here in the valley, is that. So stick with me on gopro for one second. Is that do you consider that a straightup Hardware Company, or do you think theres a software element that makes it unique and difficult to commoditize . I think the part that makes it difficult to commoditize is if they can actually continue to build a Community Around it. I dont think the software, per se, is that differentiated, but theyve shown they can rally a Community Around it. And we know things like youtube show us that we can monetize communities. So, to me, basically, what youre buying in the ipo is, youre basically paying Something Like two times revenue, which at that growth level for a Hardware Company is pretty reasonable, and you have an option on a content and Community Business on top of that. The other types of hardware i imagine youre thinking about are things like nest, which google now owns. We had beats get acquired. Thats more hardware than software, and drop cam picked up also by nest, which is now inside google. I think nest and drop cam, i would definitely highlight those as two really interesting examples of what were seeing out here. Again, when you think about the Hardware Components of those, theres nothing, particularly, unique about them, other than theyve spent a lot of time on the design, fit, and finish. But whats really interesting about them is the underlying software. Now that you have the software, you can use the data, you can do other things that allow you to pass Subscription Services to monetize it. I think thats a great example of what were going to see. Were an investor at a company that you probably know that makes the up bracelet. Same idea. Which is collecting data on you from a Health Perspective gives you an opportunity to build a subscription stream and really create Customer Loyalty in a way that you wouldnt get with the previous generation. By the way, i wear one of those bracelets. I have one on right now. Ive seen you wear it. My question for you is to the extent that apple comes out with a watch, does that completely displace the up band, the fit bit, the everybody in this business . I dont think so. I think theres Different Cases for many of these things. And if you look at the uptake youve seen there are in fit bit and up, what theyve shown is if you can build a Community Around this, that creates stand value. I want you to weigh in on a debate. I dont know if youve heard, its been going on for the past day and a half. Becky has been spirited on this issue. You own a Company Called lift, which competes with uber. And weve talked about the Regulatory Environment around these companies, and specifically, the insurance requirements for drivers. Becky is pretty, can i say, strident, is that a fair look, i think that Companies Like yours, like uber, should have to pay insurance costs, to make sure that drivers, at least when theyre excepting any sort of lifts or excepting calls coming in, they should be covercover covered corporately, by you. You mean by the company, by lift. Look, i dont have a really strong view on it. I think it makes a lot of sense. But with all these things, the bigger issue were seeing is the Regulatory Environment is going to have to adapt to a lot of these different types of companies were seeing, whether its lift and uber, whether its air b b, in all these cases, i think the Regulatory Environments we have today are going to ultimately adopt and change to accommodate these new technologies. Because the value they bring to the communities is just too strong to ignore. Final question for you, scott. When you think about the different ecosystems, and this goes to google buying everything and apple now buying everything, where does microsoft fit in that . Where does facebook fit in that . And are we going to end up with sort of four big majors who then just scoop up Everything Else . You know, i think, you know, thats probably not the likely outcome, just because the you know, the amount of technology and innovation thats happening, and again, the kind of market sizes these companies can go after is tremendously big. I think those companies will continue to be aggressive on the acquisition front, i dont think theres any question about that, but i think therell be more standalone entities, Companies Like air b b or others that are going after opportunities that are so big, that i just dont think that theyre going to end up as anything other than independent companies. Well leave the conversation there. Scott, thank you for waking up early there in san francisco. Thanks for having me. You bet. Coming up, a negotiation deadline approaching for west coast port workers. Well tell you what a shutdown would mean specifically for retailers across the country. And later, theres a big political piece, thats why weve discovered this guy. Hes a republican and theyre calling him the brad pitt of the republican party. And its a hotly, hotly contested race in minnesota, thats attracted National Attention for his hollywood haircut. Hell join us in the next half hour. As we head to break, check out the squawk box market indicator. In todays market, a lot can happen in a second. With fidelitys guaranteed onesecond trade execution, we route your order to up to 75 Market Centers to look for the best possible price, maybe even better than you expected. Its all part of our goal to execute your trade in one second. Im derrick chan of fidelity investments. Our onesecond trade execution is one more innovative reason serious investors are choosing fidelity. Call or click to open your fidelity account today. Welcome back to squawk box this morning. Take a look at futures and see how things are setting themselves up for this friday morning ahead of the weekend. The nasdaq down as well, close to 4 1 2 points down, and the s p 500 off a little over 4 points. Making headlines this morning, crafts retailer, michaels pricing its initial offering at 17 a share last night. That was the lower end of its expected range. Shares are expected to start trading on the nasdaq today under the ticker mik. Michaels ceo will be joining squawk alley later this morning. Unions and shippers are working to avoid a west coast port shutdown. It could disrupt businesses across the country, especially retailers. Courtney reagan joins us now with more. They are the most affected, i guess. Retailers. And this actually is a really big deal. The clock is shipping as the current contract, keeping business going. 30 west coast ports handle about 40 of all goods that enter the u. S. A port shutdown could cost the economy 2 billion or more per day. Now, on one side is the International Longshore and warehouse union, representing more than 13,000 workers along these west coast ports. The Pacific Maritime association is on the other side, representing Major Shipping Companies at ports from san diego to seattle. So far, no contract deal has been reached, though both sides say negotiations are continuing. The worry is that talks will stall and so will dock work. Or worse, workers will strike and goods will be stuck in the middle, putting retailers in a lurch, with backtoschool merchandise stuck between the shore and their stores. Though most believe a strike sun likely at this point, there is, quote, anxiety, but not panic. Thats what we heard from some folks involved in the situation. In an effort to somewhat protect inventory, 31 of roughly 50 shippers surveyed by Wolf Research have increased the amount of goods through their west coast ports. Buckingham Research Says rails are also seeing higher volumes, likely because of a rush of shipping ahead of a potential west coast port shutdown or slowdown. And one driver actually told cnbc producer jeff daniels at the los angeles report that there are already signs that the union is flexing its muscles. He waited 7 to 8 hours last week to pick up cargo. The last time ports were closed surrounding a contract dispute was in 2002. It lasted ten days and cost the u. S. Economy upwards of 1 billion per day, by some estimates. President george w. Bush actually had to order both sides back to work under the tafthartley act. This is really serious business. In 2008, things didnt shut down, but there was a very big slowdown. Its a problem. And its 2 billion a day. Yeah. I wonder where it would be something where youd actually start figuring gdp. Its probably not going to happen, but we had the weather. I actually wondered if it would change things in this quarter. If we had the weather down and put it down 2. 9, the next gdp, well, we had the dock worker strike. Theres always an excuse. 3 of all goods coming in, they could be held up. We could get this year down to 1 , instead of 3, you know, with enough help from things like this. Exactly, all these extraneous factors arent doing us any good. They say theyre extraneous. And the bottleneck. Theres nothing that comes in there thats used in like Manufacturing Processes . Yeah, there certainly is. But its not just retail. Its almost anything thats imported. 40 of all imports are coming in through the west coast ports. All right. And at this point, they think that its, you know, that both sides will eventually they think so. All right. Thanks, courtney. The National Retail federation and the National Association of manufacturers releasing a study saying that the u. S. Economy could lose, in this case, it says 2. 5 billion a day, if it were shut down. Here, now with more from washington, is matt shea, president and ceo of the National Retail federation. And you probably can handicap it, matthew, the likelihood. I mean, is it 80 that it doesnt happen . Do you know, at this point . Well, joe, i think our interest, and courtney made this pretty clear, its a big deal. What we want to see is the parties stay at the table. We dont want to see any delays or disruptions, certainly not a strike. And were agnostic as to the way in which the negotiations turn out, but the longer this goes on, if it starts at all, its going to disrupt the entire supply chain. And its not only retailers, but its manufacturers, its farmers, agricultural interests, the entire transportation system. So the Ripple Effect of what happens here when basically 45 of all containerized trade that comes into or goes out of the United States goes through these 40 points from san diego to bellingham. And if that gets disrupted, 12. 5 of the nations gdp is put in jeopardy. And our economy just doesnt need to be put at that kind of risk at a time like this. So thats 12 you got a different number. Thats 12 . So how long do you remember when it happened last time, and bush did tafthartley. Do you remember that . Yeah, that was 2002 and that lasted about then days. Its interesting, before that lockout occurred, before that strike occurred, the split betwe between east and west coast ports and container traffic was about 50 50, divided evenly. And as retailers and shippers and agricultural interests experienced that problem on the west coast, they shipped it to the east coast. Thats why now, its 46 44 in favor of the east coast. Because people moved away from the west coast, as a result of that disruption. Well, how is it when someone invokes tafthartley, like bush, how is that taken by the unions . Like, would president obama be less if it did come to this, and this is a long way off, but if it did come to Something Like that, is a democratic president less likely to do that and get these guys back to work, or not . Well, i think the political speculation probably, at this point, is premature, because were hopeful the parties will stay at the table. I get that. So tafthartley gives the president the authority to require the parties stay at the table and continue to negotiate. And were all hopeful that will happen. Weve been communicating about this since as early as april and have regularly talked to the white house about it. You know, its two years ago that we had a similar issue on the east coast, right around the holiday season. So whenever this comes up, its got broad implications and it affects because in this day and age, in the 21st century, we all know the way supply chains work. Theyre highly sophisticated, its very mechanized. The timeliness and the speediness with which this has to occur, if these 13,500 dock workers up and down the west coast disrupt the supply chain and the parties cant find an agreement, thats got implications that ripples throughout the entire what do they want . Whats the key stumbling block here . Is it benefits, is it way, what is it . Guaranteed employment. You know, joe, i dont know the answer to that question. As i said, were agnostic as to the specifics. Were just hopeful that the parties stay at the table and continue to talk and resolve this in a way that they agree and we dont have an opinion on that. We just want to see them continue to discuss it and make sure they dont disrupt our economy. And were coming off a tough First Quarter. We all know that. And that was something we couldnt control, because a lot of it was weather related. But what were talking about now is completely, entirely manmade. Its entirely avoidable. You know, we dont need to relive the kind of selfinflicted wounds we had with the fiscal cliff and the debt ceiling dramas and government shutdown. Why do we put ourselves in these situations, where we know we can avoid this. And lets not jeopardize the 2 growth. You know, you had kevin yesterday talking about, lets get to escape velocity. We bump along at 2 , well never get to where we need to go and put people back to work. Its benefits and job security. Thats the same thing is this the contract that contract is now expiring. Is that the one . Really, it was a 12year contract. The contract is set to expire. I think its the same one. Last contract talks were in 2008. 2008. All right, anthony, lets, you know, it doesnt help anyone. I dont know, the president doesnt want this either with elections in november, and you dont want two straight week gdps. And the ultimate impact, you know, in the initial stage is the folks impacted are the workers in those industries, but ultimately this is about consumers. And so as this, you know, if a disruption is to occur or worse, ultimately, prices go up, retailers and other shippers are already making contingency plans. We saw courtney refer to the wolf study. So people are shipping early, theyre shipping more, to east and gulf coast ports. The potential winners are those east coast ports that are trying to beef up because of competitiveness and make sure theyre deeper. And ultimately, consumers lose. The prices go up, consumers lose, and were right back in the soup, weve been talking about this for five years, consumer confidence, Consumer Spending power, the ability to really drive the economy and you know, we have twothirds of the economy is consumer driven. And thats the way it is in this country. Were not china, but if we headquarter Consumer Spending, we hurt the overall economy and that hurts jobs and gdp. So its all completely interrelated. Okay. Matthew, thank you. Nice to talk to you again. Like the ports in washington, d. C. Will be affected on the coast there. Mary thompson is in one of these ports a few years ago. Not the washington, d. C. Harbor . Not those ports. The east coast on the i think its ton the water there. Coming up, hes a businessman running for congress, minnesotas eighth district. But Stewart Mills is getting headlines for his legends of the fall haircut, and a campaign ad featuring the candidate in pink heels. What . hell join us at 8 40 eastern time. But next, a look at the 2014 political elections and events likely to make headlines and the impact of those on the market in the second half of the year. Back in just a moment. trader vo i search. I research. I dig. And dig some more. 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Get the mercedesbenz youve been burning for at the summer event, going on now at your authorized mercedesbenz dealer. Hurry, before this opportunity cools off. Welcome back to squawk box, everybody. The futures this morning have been a little bit weaker. The dow futures are down by about 28 points. S p futures off by just over 4 points. Weve got a lot to talk about this morning with these markets, shape up how the weeks been going along the way. Also coming up, our disrupter series continues with a messaging app that works when your phone doesnt have a reliable signal. Fire chat has become popular in iraq where the internet is frequently shut down. The ceo of the Startup Company that developed the app will join us next. But lets continue our rook ahead to the next six months. Heres cnbc correspondent john harwood with an outlook for politics. This is what to watch for in politics in the second half of 2014. Just two things, really. The first is whether congress and the white house could get their jobs done with a minimum of partisan friction. For congress, that means keeping the government opening, avoiding a shutdown. For the white house, it means managing Foreign Policy crises in iraq and series. And the second is novembers midterm elections, where republicans have a chance to recapture the senate and expand their majority in the house. That will set the tone for the last two years of president obamas term. Thats your second half outlook for politics in 2014. Im john harwood. Tdd 18003452550 there are Trading Opportunities tdd 18003452550 just waiting to be found. Tdd 18003452550 at schwab, were here to help tdd 18003452550 bring what inspires you tdd 18003452550 out there. In here. Tdd 18003452550 out there, tdd 18003452550 there are stocks on the move. Tdd 18003452550 in here, streetsmart edge has tdd 18003452550 chart pattern recognition tdd 18003452550 which shows you which ones are bullish or bearish. 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Also, Athletic Apparel maker finishline reported a quarterly profit of 28 cents per share, beating estimates by 7 cents. Finishline says its being helped by an expanding relationship with retailers, macys. And Progress Software earned 3 cents above estimates. The maker also raised its earnings outlook for the year. All right, fire chat is an obligation that allows users to conduct with others in clos proximi proximi proximity. The anonymous messaging service has been downloaded in iraq more than 40,000 times since june 14th. Joining us right now, mischa, who is cofounder and ceo of open garden. Thats the company that developed fire chat. Mischa, thanks for joining us today. Good morning, becky. How does it work . This works in a situation where you can message each other, even if you dont have an Internet Connection . Absolutely. With firechat, even if you dont have an Internet Connection or any access to wifi hot spots, you can keep on messaging people who are around you. The way it works is your smartphone is going to connect to other smartphones around you, directly, without having to pass through a tower. So i can understand why a place like iraq would be a huge draw for Something Like that. Whos using it there . So, people there use it to create discussion topics. They use it to keep in touch with other people, and also to stay informed. And to share information. And this is a situation where those conversations arent private, though, right . Other people can see them and they can see whats being said . Exactly. So people create topics and then they start discussions openly with other people. Everyone can access any topic and participate in the discussion. Is this something that takes over for texting, for cell phone calls, that would have been used, if you had a connection to the internet or if you had Cell Phone Service . So the great thing is, it works ton grid and off the grid. There is no internet access, and that is often the case in iraq. People can keep on having conversations. Is this i would assume, average citizens are using this, but is this something thats being used by isis and some of the terrorists there as well . So firechat is like the internet. Anyone can use it. And thats what is great about it, is its actually completely open and it should mainly, in iraq, for creating discussions and keeping informed. People who want to know whats happening, they want to share information, and its perfect for that. What happens . Do you get paid for every download . Absolutely not. Fi firechat is completely free, we dont get paid for downloads and we are not looking to make money with firechat. Where else is being used outside of iraq . We have seen recently a spike also in old middle east, but six weeks ago,well a spike in iran, when the government decided to shut down the whats app. And iraq, like you said, 40,000 installs in only one week. Thats unusual for this application, and its not the kind of download we usually have in iraq. But you say youre doing this and youre not charging, you dont want any money for it. Is there a Business Model behind it, or this is just something youre doing to try to make sure people can communicate in areas where they otherwise would not be able to. There is a business behind it. What we build with fire chat is we are building a peertopeer mesh networks and enable more user time. So we enable people to be connected to the internet more often. And with our partners in the future, when we enable them to have access to the internet, when normally their normals wouldnt have access to the internet, were going to charge for any events that are generating money. You see this mostly as a product that is popular in the middle east and some of the wartorn areas and in thirdworld nations . We see spike of firechat all over the world. But, most specifically, when there is government that want to shut down the internet, we experience big spike of installs. It happened in taiwan, for example, during the protests. It happened in iran, and now its happening in baghdad. All right. Misha, thanks so much for joining us. We appreciate your time. Thank you. The ukrainian president is in brussels, meeting with eu leaders about what to do with the situation in russia. And julia caught up with the leader just a couple of minutes ago. Julia . Thank you so much. That meeting with the eu leaders and the ukrainian president ended just a few minutes ago. And it came with a strongly worded message to both moscow and to the separatists in the east of ukraine. Four conditions that they want met by monday. The first, they want to see the release of hostages in the region. They want to see the return of border posts to ukraine. They want some controls to stop the flow of weapons into ukraine and see all parties come together in this peace protest or else. And when i spoke to the ukrainian president , i said, what happens if we dont see a push now from Vladimir Putin to meet these conditions by monday. Listen in. Youve laid down conditions that you want to see enacted by 30th of june. What happens if you dont see that happen . I think that the ceasefire will expire. And ukraine will defend ourselves, with all methods we have in our disposal. Youre talking military engagement. Including military. Because we cannot except the ukrainian soldiers are killing, that our checkpoints are captured, and the tanks and artillery system are going to ukraine. And i am a person of peace. And i use every chance to keep the peace in ukraine. But if this Peace Initiative would be rejected by russian or by separatists, we should defend our country. This is very simple. Reporter the russians threatened you with grave consequences today as a result of the association agreement. What direct talks are you having with Vladimir Putin right now about all of these things . Actually, we dont have fullsized direct talks about that. These talks would be prepared. And thats why on the third of july, we will have a consultation on an expert level, on the 11th, we have an consultation on the ministers level. When they prepare, what we should talk about, i think that would be a topic to discuss at the highest level of head of states. Im really ready that we can deliver the information that if you remember, year 2008, and statement of president putin about the free trade zone from lisbon, this is exactly, were doing what he predicted in year 2008. And were waiting it would be done the same. Reporter so what you heard there was the ukrainian president saying that hes not engaging directly with Vladimir Putin, which i think is a concern. Hes also saying, if mondays deadline isnt met, hell look to engage on a military level with the separatists in the east. So that makes monday very crucial. Hes now going to go back to kiev and decides what happens about todays ceasefire deadline, 3 00 p. M. Eastern, with the rebels. Again, we expect him to push that back now to monday, so thats what well be here waiting for. And weve also had the eu leaders saying, look, we stand behind the ukrainians and ready to meet at any time to push for harsher sanctions. This is where it is. A lot of details to see what happens in this peace protest. But mondays the date. Guys, back to you. Yeah, julie live from brussels, yeah, monday the day for that. Tuesday is a date when all those people in brussels are in for a world of hurt, world of hurt. See how they feel after a potentially, we can hope. After a drubbing, or a drubbing, if its tuesday, it must be belgium losing in the world cup to the United States. Coming up, hes running in one of the more competitive house races in the country. The man that politico described as the brad pitt of the republican party. Really looks a little more like steven zon, ive been told by some people in the control room. But whatever, were going to talk more serious issues with him and why he thinks he needs to win this seat in minnesota and what the rationale is, when we return. I take prilosec otc each morning for my frequent heartburn. Because you cant beat zero heartburn. Woo hoo [ male announcer ] prilosec otc is the number one doctor recommended frequent heartburn medicine for 8 straight years. One pill each morning. 24 hours. Zero heartburn. Frequent heartburn medicine for 8 straight years. water dripping and dont juspipes clanging ncisco. Visit tripadvisor san francisco. soothing sound of a shower with millions of reviews, tripadvisor makes any destination better. [ girl ] my mom, she makes underwater fans that are powered by the moon. [ birds squawking ] my mom makes airplane engines that can talk. [ birds squawking ] my mom makes hospitals you can hold in your hand. My mom can print Amazing Things right from her computer. [ whirring ] [ train whistle blows ] my mom makes trains that are friends with trees. [ train whistle blows ] my mom works at ge. He is running for congress in minnesotas eighth congressional district, but hes been making news for a variety of things. Politico called him the brad pitt of the republican party. Stewart mills joins us now. Stewart, republicans, lets see, republicans, you know, the democrats have president obama, who is how cool is he . We have mitch mcconnell, the republican. I dont mean we, but republicans have mitch mcconnell. You dont want it to be about the hair, but here we are, youre on a national show. But, sort of because youre cool and because youve got the hair. So you dont want it to be about the hair, but is it about the hair . Hey, if theyre going to give me the microphone, ill take it. Because the thing i want to talk about is job creation, for our part in minnesota, and replacing and repealing obamacare with a patient centered free market alternative. Because not only is obamacare hurting a lot of people in our part of minnesota, businesses are afraid to hire people. Theyre staring down the barrel of the employer mandate, and theyre afraid to go above 50 employees. How is this being received in minnesota . A pretty liberal place. Isnt al franken from there. Is he the senator from this state elected al franken, for gods sake. The state did, but our part in minnesota has a tendency to be very conservative. Some years it votes democrat, a lot of years it votes democrats, but some years it votes republican. Democrat or republican, it is a conservative group of folks. They care about jobs, they care about the economy. And you do have, in your district, a much worse employment or unemployment number than the rest of minnesota. And you attribute that to misguided, both, national and state or local policies . Most certainly. We have a main street oriented economy. The vast majority of our employers are taxed at the personal individual level. Theyre subchapter s, llc, and under the Obama Administration, theyve had their tax rates raised to 39. 6 . And we are having a high unemployment number, but not only that, thousands, thousands of our friends and our neighbors have given up looking for work altogether. And theyre not counted in that unemployment statistic. Well probably have to give you know, we booked you, the politico, youre getting a lot of mileage, you know, from, i guess, for superficial reasons. But i guess wed have to give your 70yearold opponent equal time if he wants it. Hes a nice guy. He was out of congress for a while and came back in 2012. You think that i dont know, did representative nolans policies help to cause the problems you have in your district, do you think . Oh, rick, while being a very nice guy, is out of step with our district. He has taken the vote weve given him, hes taken it to washington, d. C. And hes abused it. Hes voted against the v. A. Bill, voted against keystone pipeline. Hes frated by the nra. He thinks obamacare is a great first step to governmentrun single payer. Hes voted for the progressive budget, which includes over 6 trillion worth of new taxes, including a carbon tax. As nice of a person as he is, hes abusing the vote that we have given him. We didnt explain why you wear pink high heel pumps. Whats that about . We teased that. We probably should talk about it. Not that theres anything wrong with that, but theres a reason. There very much is a reason. And im very proud to support our local Womens Center and Sexual Assault services. And if once a year sponsoring an event, putting on high heeled shoes and walking a mile to raise awareness is going to help an issue that is hurting our community, we can all come together as a community to put focus on it and to help address it and raise funds. Im very happy to put on high heeled shoes to support that cause. There you go. Okay. That makes sense. It wasnt a stunt. And you also, you know, people that dont like you would say youre like some party dude. Youre seen in beer commercials and your family is well off and has a chain of Sporting Good stores, right . So you come from some money and youre like a rich kid who wants to be in office now . Far from it. Yes, i have lived a very joyful life. I have had a good time, but ive also worked very hard. And one of the things ive worked hard on is this campaign. And i understand how main street works, because ive spent my entire life in a business that has taxed the personal individual level. Its hard work, sweat of the brow, reinvesting back in our businesses, and that is how the rest of main street works. And whats happening right now is they have put a target on the backs of our main street Business People and their employees. You cant be for jobs and against job creators. And its a subchapter s, stewart. And i guess one of your relatives started it at some point and was an entrepreneur pb and its a subchapter s now. I give you credit for knowing what the Small Business owner was up against. Yes. My dad and my uncle started nit 1955, theyre twin brothers, and since ive been alive, ive seen exactly what it takes to have a business, to reinvest back into it, to create jobs, not only that, as ive had the opportunity to participate directly in it, one of the roles i currently play in the business is plan administrative of our company, selfinsured health plan. And ive been doing that for the last 14 years. And ive seen firsthand exactly how obamacare has hurt our friends, our neighbors, and our employees and their families. All right. Well, we enjoyed having you on today. We appreciate it. And, hes a republican. Hes not he is. Looks can be deceiving, right . Looks can be deceiving. I like it. Dont change. Dont change. Thank you. I will not change. And if your opponent wants to come on, we would have him on. But thank you we reached out to you and thanks for coming on. Appreciate it, stewart. Thank you. Thank you for having me. Coming up, when we return, a closer look at the markets as we get closer to the opening bell. Plus, it is the weekend. You can read all about it, the coolest hot ipo in a very long time, find out what gopro looks like. Plus, is it finally the death of the desktop . And what it takes to be stupider than france. Talking squawk lives at squawk. Cnbc. Com. Back in just a moment. Monday on squawk box, its the final trading day of the quarter. 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In fact, todays xerox is working in surprising ways to help companies simplify the way work gets done and life gets lived. With xerox, youre ready for real business. Welcome back to squawk box, everyone, watching the features, weaker, and dow futures down, and thats because of dupont, the Chemical Company that warned they would be seeing low eer guidance in the Second Quarter and full year. Amazon is feuding over contract terms with the publishing giant. David faber spoke with one author who is up in arms. Amazon is bombing the cities. You know . They are attacking, and the publishers are just sitting back there and saying, what can we do . James paterson among the best selling writers of all time. I have an idea pile here somewhere. I think books are important. Steven king thinks books are important. That is why all of those people are speaking up now going, hey, amazon, please, this is not the toilet paper industry. These are books. Are your sales going to be heard as a result of the dispute . Sure, they are being heard right now, of course. Theres a lot more to come . One would think they had not just attacking. We have to think about this. They are so powerful. Amazon told cnbc when they negotiate with suppliers, they do to keep the value and service high for customers. For more on the billionaire boss behind amazon, go tune into amazon rising sunday at 9 00 p. M. Eastern time. Whats working series, a closer look at solar stocks up big year to date and if the future is bright or dim for the sector, and later on squawk on the street, michaels ceo is talking about the ipo. Stamps. Com is the best. I dont have to leave my desk and get up and go to the post office anymore. [ male announcer ] with stamps. Com you can print real u. S. Postage for all your letters and packages. I have exactly the amount of postage i need, the instant i need it. Can you print only stamps . No. First class. Priority mail. Certified. 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Welcome back to squawk box this morning, looking at whats working in the market, and the sun is shining on solar stocks. A bit surprising. This was a sector seeing red not long ago, and its been making a comeback, possibly a big comeback. Huge gains in the stocks over the past year, plus, stocks in the sector got a boost last week after a positive note saying rooftop solar volume grows at a 40 annual compound growth rate through 2016. Lets bring in ben callow, and you upped the price target. Before we get there, whats happening in just the solar world for those of us in the uninitiated camp right now . Sure. Thanks for having me on. First, we had consolidation in the industry, helping out in the supply and demand equation. We had new markets open up like the u. S. , which you mentioned in your introduction, and also china is becoming the biggest market in the world, and japan is on fire right now after the nuclear disaster. We thought it was not first time efficient and worked only if you had tax credits . From 2008 to 2012, costs came down dramatically as prices push down as well making solar more affordable in different parts of the world. Now what we see is solar is competitive with fossil fuels in almost nearly half of the world. Talk about sun power. You like sun power, talk about it in the context of solar city. You like solar power why . So sun power. The technology backbone, put that up against solar city in the recent acquisition they made, move in the direction sun power is in, producing high efficiency cells and models, and now its a channel on the next positive for sun power. They sell not just to the residential market, but commercial industrial markets, so the rooftops of walmarts and large scale projects in the desert. Very geographically diverse. Exposure in japan, going gang busters right now, and then good exposure in the u. S. As well, and then you have a Great Management Team that lived through that crisis of 2008, 2012, came out stronger, i think, as a position with their numbered accordingly. Ben, how high do oil prices have to be to be an efficient trade . They trade, and we have to watch natural gas closely in different parts of the world, but we are cost competitive with natural gas plants and prices, and, you remove the volatility of the commodity risk there as well, and in the maintenance type of cost associated with the natural gas plant. Would you buy elan musks solar city right now . I would, but buy sunpower first, and i think there is some callous, but in the longer term, bringing on the gigi factory in new york, theres risks. I covered tesla, favorite for the back half of the year, no advanta stranger to the elan musk factor. I dont know if you saw the report from japan, subsidizing auto makers in terms of batteries and other things. How big a threat is that to tesla. They have the advantage with three years and growing, built the brand, and were watching it. I dont want to dismiss what toyotas doing on fuel cell, but theres a large infrastructure needed for that where electric vehicles, we have infrastructure in our garages, plugs already, we dont need the build out. Ben, thank you for the time. Appreciate it. Fun, guys. Its friday. Its friday. Fridays are good. Always good. Remember, if its tuesday, its bull gem. Exactly. Join us on monday, but first, squawk on the street is next. Good friday morning, welcome to squawk on the street, im Carl Quintanilla with simon hobs, and cramer is back monday. Futures lower monday as we inch closer to the end of the quarter. The dow and s p foal three out of four sessions, still hanging on gains for the june. The 10year, at least five firms cut their estimates for q2 gdp, and well get Michigan Sentiment in an hour