Transcripts For CNBC Squawk Box 20160824

The docket. Releasing weekly report on mortgage applications. Thats coming at 7 00 a. M. Eastern time. Then at 10 00 a. M. Look for july existing home sales which are forecast to drop nearly 1 after rising more than 1 back in june. Form suit Pharmaceutical Company agreed to sell part to pfizer. That deal involves three already approved antiboy yachtics. You may remember has rejected 118 billion dollar off back in 2014. Check on the market this is morning. Mostly flat. Europe was a bit higher. Started out as a positive session yesterday after europe did pretty well. Moderated gains. Up a little yesterday, the dow. Futures were up. The ftse is the only one down now. Germany, france, italy and spain all trading higher. Not much happening in asia. Shanghai staying above 3,000. For a while we were worried about what was going to happen in the shanghai market. Then oil, which, in my mind if it stays between 40 and 50, i dont see how that gets correlated to Everything Else in the world. It was pointed out to me yesterday in light of whether the fed raises in september, it was pointed out the dollar is actually lower than it was before the last hike. So any concerns that hiking is going to raise the dollar and autoo cut off. We assume the fed worries about that. The market has doning in since brexit. We heard what the elitist told us that was going to do. All of the economists agreed. 100 of them. All wrong. Stocks to watch today. Lazy boy. Hurt by weaker demand. Getting clobbered. Down 14 . Intuit reporting a loss. First quarter outlook below analyst forecast. Maker of quickbooks and turbo x turbotax. Still stock is lower by more than nearly 5 . Nimble storage reporting loss. Top forecast storage provide r predicting a loss in line with estimates. In politics, Hillary Clinton coming under fire following a new report how donors to the Clinton Foundation got access while she was secretary of state. Calendar shows more than roughly half of the people outside of the government who met with clinton while she ran the state Department Gave money to the Clinton Foundation, either personally or through companies or groups. 85 donors who met or spoke to clinton, contributed a combined 156 million to the foundation. Donald trump and others accuse the clintons of setting up a business to profit from Public Office and heres what he said yesterday at a rally in austin, tex texas. Hillary clinton is totally unfit to hold Public Office. It is impossible to figure out where the Clinton Foundation ends and the state department begins. Im glad. Thats our thing. Anyway. Im on the board of a nonprofit. You are . Yes. Do you know how hard it is to raise money . Its so hard, but not for them. Its amazing. Im not thinking from that last story. Really . Its hard for you to raise. Its very hard for nonprofits to raise money. They were astro no, maamically good at it. How about having access with you. Cant you get 156 million. You would think. I would think. But believe it or not, no. Can i just suggest one thing. Must you . Youre going to do this joking thing about how hard it is to raise money and im not going to defend her. By the way, i think its terrible. What are you doing . Absolutely awful. When you say it the way you said it, you are going to defend. I just think theres two things have to be put in some context. One is the numbers, the math. The denominator matters. Theyve done it a specific kind of way. The ap. Yes. I saw robby say that yesterday. Did he send you an actual talking point rebuttal. No. Thats exactly what robby luke said yesterday. The other piece of this it is a Charity Foundation where the money actually does go to other people. Its not like its going. 07 cents on the dollar probably. 90 literally going out the door. Being used for charitable. That is not what i saw at all. I saw 87 cents in canada. Most of it for administrative. And hiring friends. Some of these dont even monitor. They stopped. One of the main ones stopped monitoring the Clinton Foundation because it was so untransparent. That was last year. They stopped monitoring. Show me the one that says 90 . It doesnt help to say that. And then put the false in there that 90 cents goes to digging wells. Thats not the way this works. You think none of it. I think very little. Straight to the pockets. If thats the case, its terrible. If thats the case, then its terrible. Show me the 90 cents on the dollar. Meanwhile, are you corresponding. I dont want to send you any emails now. Have you been talking to putin today through emails. Just this morning. Whats going on over there. Gmail together. Oh, the New York Times was supposedly some an attempt. I dont know if it was successful. I know nothing in truth about this situation. Except what you read in the paper. Okay. Say that again. I know nothing. Say that, right. Use it after every what is it, first the chinese, now the russians. Influential newspaper. Youve got to be the only person in the world. They want to see how its done. Youre the only person in the world that talks about the good works that were done. Instead of looking at this as totally clinton business. Im saying it looks terrible. Youre the only person saying a lot of the money actually did things. I dont believe they would be able to raise nearly half the money or 10 of the money if people did not think she had a chance of becoming the president. Theres no question that has weighed on the whole thing. Theoretically to be able to buy and theoretically to be able to do a lot of things. Has nothing to do with her being president again. She was able to do things while she was secretary of state for them. I guarantee theyre too smart for an actual quid proquo. Other president s have done foundations after they left office, but they never raised money and the reason is the potential for Hillary Clintons political career. When you were 10, were you watching the clintons the way things were done. Ive seen it. So your familiar with the 30 year history of the clintons. Im not thrilled about it. As long as your its hard to be. Its hard for anybody to sit around and say it looks great. As long as your. None of it looks good. If youre interested many power and money. They are the way to approach life frl college on with every step following anyway. Back to the markets now. The what do you think . Are you with me or not . You may have to leave. Only one good answer. The nasdaq hitting new highs. Investors look ahead to janet yellen speech on friday. Joining us now, chris, i dont think hes going to be talking about yellen and the fed. Theres other stuff to say. On the economy, rob marten, senior u. S. Economist at barclays. So rob, you think, beyond your analysis here. You said the fed is doing at least one hike this year so because it says at least then it has to be september. It could do december and be in at least one. Sure, could do december. What duds r did that statement mean in the notes. If they have to do at least one it has to be september. Why. If you want to have the part of the at least coming true. Its september or never. In the following sense. Either they go ahead and go in september, the economy looks great. Looks much better in june when the median member wanted two hikes this year. Everything has come back. The employment looks good. Inflation picture is improving. If they dont go in september, theyre starting to shift more towards an actual inflation basis. If youre talking about waiting for inflation to get to 2 . Youre talking not september versus september. Youre talking about september this year versus September Nelson cruz year. September 2018. Depend when inflation is going to come back to 2 . Their forecast end of 2018. September is it or never. September or never. Things be before the election. I would tell you its not going to be september in advance so then youre up to never. You know, i do see that. I do see concerns about the election. However, the fed strives so hard to be apolitical. They really. You think they would do it to show theyre apolitical. No. If you go in september, its something related to the politics. Either to say im independent. I think its a demonstration of the strength of the economy. Coming in the june meeting the disastrous may report in hand. To have expectations dropped out of the range. That number got revised. June jobs were great. July jobs were good. Were expecting another 200 thousand in august. The economy is doing great. The economy looks good. Well, i saw what he said that the fed would not the fed was in able to raise last time because of one jobs number. One jobs number precluded them from going up a quarter point. Now you say that its going to go up and think 22. 25 for the next quarter. If we get one off and a job number, they wimpb o out again. Thats not the way to run Monetary Policy. Also not the way a Strong Economy acts not being able to get above 2 . A Strong Economy does act like that. We have a lot of volatility in the jobs report. If you go back to the 199 0s that was a boom economy. We had a period with almost no job growth. Weve never had a period of gdp growth so weak. Were in a new era. We have baby boomers retiring. Productivity is low. We dont understand why its the lowest. I can give you plenty of reasons its grow and it has more to do with demographics. It has to do with regulations. At this point, you lining te Like Technology and other areas to hit higher regardless of what happens. Were certainly getting forced out on the risk curve. Global interest rating are keeping rates low. Whether the fed moves in ceme september or december probably did you want matter for all equities at this point. Theres no alternative, but equities out there. We see small caps finally catching up after a bunch of bad years. Theyre doing well. We see management continuing to execute or business plans. Thats where you have to be looking. Is at companies that continue to move forward and can grow their bottom top line and bottom line. So we Like Technology. We see a lot of good trends there. So at this point, if they go just once in september, then why is that the last one . So september or so we think theyll go in september and we think theyll go two more times in 2017. Just the last one for this year. And the reason theyre going slower like that, thats the whole new equilibrium level. The fed has come on board with the fact growth is slow. Theyve not fully internalized that. Likely to stay slow. That keeps Interest Rates lower than they would have been in past cycles. We think the chair will talk about that friday. Theyll talk about the policy framework in a low Interest Rate environment. All right. Gentlemen. Thank you both. Andrew is printing a bunch of stuff out. Its amazing. Chart watch, 88 goes to overhead is 12 . Cost to raise 100 is 2. Office supplies expenses consulting fees. The difference between. The charity only spent 22 percent of charitable programs. The drimpbs between the Clinton Foundation and other foundations that are considered pass through foundations. They do it themselves. Youre talking about the canadian affiliate. Im not disagreeing with you on that. Thats a tiny piece. Not that tiny. Eight dollars out of even 10 goes to salary. You think it was set up to do you know what happened in haiti, right . That was some grand ego play. You would say im not saying it wasnt inspired by haiti. Lets say every company that did the relief work in haiti was somehow related to the clintons so there they are spending the money on trying to rebuild haiti, but every Single Person that benefitted from it looked like a clinton affiliate down in haiti. So you could say thats 90 cents of every dollar going to chart, but look the way it was allocated. Look who benefitted from it. Look at the tentacles of how it works in light of also the you know. You can be naive about this, but and listen to robby, but. Im not listening to robby. Im listening to. James yesterday said. Legitimate people who studied this stuff. Someone is going to go to hell for criticizing the good work of this. You think no good works in here . I think the right wring conspiracy that the emails and all this stuff was kept in the forefront because of political reasons. No longer works anymore. Where theres smoke theres fire. 30 years weve seen this type of stuff going on. Obviously people that are supporting her dont care. When trump said i could shoot someone in new york and still get a vote. I think the same thing goes for clinton. This isnt going to change any of the people for Hillary Clinton. This is all a big taease because with have eric trump coming on the show at 7 30 we can ask him about this stuff. Im sure hell disagree. Like i said, if it wasnt for the blue dress, none of that would have ever been copped to. None of that would have ever. If it hasnt been some strange benghazi linkage to all these emails, we wouldnt even be looking at these emails. It was a total fluke we are. Now we know theres a good reason. Given your interest in the transparency related to all of this information, which is why were able to talk about it, im surprised as the juniorist that you are you dont want to see trumps tax returns. Just to understand who he is and what hes about. Look. I would think thats a straight. If he violated the law. I want to see it. If hes done everything he can for tax avoidance. If theres tax evasion where hes violated the law. I want to know. Im not going to shame him if his efforts dont come up to joe bidens efforts. The 200 thousand he gave year after year. Im not going to shame him. If i laugh after i say everythin everything, does that excuse me . Only marlinsly. Some other news yesterday. Elon musk revealed a amped up tesla battery. Power model s and model x from 060 in under three seconds. Musk says production will be limited at first. We think with can do 200 cars a week, 200 packs a week right now and were working very hard to wrap that up as quickly as possible. So will be somewhere around the order of 1012 of volume. And thats as much as we can figure out how to make. Joining us now for what this means for tesla strong is colin rush. Managing director. Good to have you here. So yes the car can go a lot faster. The other big head line is on certain models, the car will be able to go, he says, as far as 315 miles. First time its broken any electric car has been able to break above the 300 mile barrier. Which is nor significant, the speed or attempt to get rid of range anxiety . I think the important point here is they continue to evolve the product portfolio. Theyve introduced some incremental low end vehicles here in the last month and a half or so and now theyre adding some features for the highend vehicles and some follows sales for owners who want to add additional speed to the vehicle. I think the range for the vehicle is, you know, a real positive. I think the speed is the thing that most folks on that high end are really concerned with. This is called the ludicrous line now. If you pay the extra for the stronger battery, they call it ludicrous, right . I think its the Performance Series and theyre calling it ludicrous mode. Its cute. You dont think its good marketing gimmick at least . I think theyre great marketers. Yesterday they made this announcement and spent 30 minutes talking with the press and no time speaking with the financial teams. Youve got a perform rating on it. What would make you like it now. Right now 224 per share. For us, weve been excited about the auto platform that theyve developed. We think theres significant operating leverage here. We downgraded the stock with the solar city transaction yesterday. They also announced elon personally was buying a significant portion of the solar city bonds that were issued at a significant premium to previous issuances for similar securities. You know, i think theres some real concern around the relationship between solar city and ses la and the return on equity for the tesla investors here. Because when he buys those bonds, that means more and more he is inclined to insent vised to help the company out. Close that deal. Yes. Yes. I think thats fair. I think the concern for us is that similarly dated paper thats been issued in the last year was trading more along the lines of 4. 4 , 4. 5 versus the 6. 5 they closed on yesterday. For us seeing there isnt demand for the bonds, i would disagree there is the demand for that sort of risk profile and that spread to the tenyear versus where it wuas six months ago ora year ago. Weve seen asset backed bond come in lower than they were over that same time period. Theres something there were not real comfortable with. Why dont you have a sell on it then. At this point, we think theres an entity enthusiastic investor base. Tets la may be robust enough to swallow the solar city platform without hurting the longterm prospe prospects. A lot of detail left to come in terms of the deal. The voters that have to get out and vote for the deal over the next three to six months and were just waiting and watching to get that additional detail before we make a final decision. Got it, colin, thank you. And in 2008 and 2009, there was some 126 million was spent on pharmaceutical care. In 2008, 100 million purchasing and distributing medicine, but by 2011, the direct Charity Investments were virtually nonexist tent and nothing on pharmaceutical expenses have fallen at that point down to i think 17 million out of 250 pe spent on direct. You sent me a report from the federal list. Hold the phone. This is a paying attention to the audited financial statements. Some news reflects misunderstanding about the difference. This is specifically related to this as the case with the federalist which youre quoting reported that the claim was spending 88 of expenses on the program was false. Since the tax tomorrows showed the figure was only 80 reflects spending by the parent entity while the 88 we missed this a bit earlier reflects spending by all groups. I will give you this and go over it during the commercial break. In the meantime. We have a lot more to talk about. What would you do with 11 Million Pound of cheese. Giving it to food bank. We will tell you why when we return. Squawk coming back in just a moment. To b so cheese si. The u. S. Government is buying 11 Million Pounds of cheese. The strong dollar driving foreign buyers to look elsewhere for cheese. That has led to a massive oversupply in the United States. To ease buying 21 million of cheese and distributing to food banks around the country. That is an improvement because in past years when this happened they put it into stornl. Over the summer. Dairy prices rallied on the expectation that the government would step in. Only about 1 of the built up cheese. What kind of cheese are we talking about . I need to know. I dont know. Cheddar. Not mozzarella. This is one of the most the department of agricultural makes me crazy. Every day is wednesday. National waffle day. We have nigel coming in from Dunkin Donuts. Hes going to be upset about that. Why . We vould have had a waffle guy come in. Waffles are most popular among young and old americans. 1824. 84 like waffles. Love a good waffle. Can we get a who doesnt like waffles. Have you ever had a waffle . Do you have a waffle iron . Yes, we love waffles. You like with butter or wiped cream. I think we can get a producer to call one and get a waffle guy. I think you producing from the set love it. You need to read your tweets about our discussion. All of mine, i blocked everyone. Apparently Hillary Clinton will come here to meet with you if you will remit 250,000 a check first. Can you . By the guy with all can i expend it. Can we ask her on her next press conference about it . The one she doesnt have . I will donate ive got something i cant read allowed. I will donate to the Clinton Foundation to have lunch with you. Coming up, classroom disruption sounds like a problem. Thats not the case for Technology Disrupters looking to make a difference in education. The ceo joins us to look at the latest trend in school. Then we take a look at the s p 500 winners and losers. Andrea sikon. Medical doctor from cleveland clinic, watson, lets review the Electronic Medical record of the next patient. No problem. Its a pretty huge file. Done. Sorry for the wait. That was quick. As part of our research, i also compared lab results with notes about prior treatments, then cross referenced it with thousands of medical journals. And i get the benefit of much more data, and a lot more time to plan the best treatments. I stay focused 24 7 and never sleep. You sound like a lot of medical students i know. That i would never le24 7 become a superhero. Ep. [singing indistinctly] but i learned how to fly. Just to come back in a new disguise, and be the hero ive always wanted to be. Welcome back to squawk box on cnbc. First in business worldwide. U. S. Equity futures at this hour are green, but you know, two on the s p, under ten on the dow jones and nasdaq called up about three. Were following a developing story out of italy this mower. Major earthquake hit the country. About is 100 miles northeast of rome. Several aftershocks. At least one with a magnitude of 5. 4 recorded in the hour following the quake. The number of causalities is expected to rise. Lets bring in our guest. Former coo of yahoo. Here to talk a little tech going back to school. And tesla and amazon in the headlines as well. Lets talk Book Business first. School is about to return. This has to be this is the in a moment for you, for your business. For the textbook part of our business, this is the week. This will be the biggest week we have. Set a number for the number of tekts books rented. E textbooks, physical textbooks. When we went public three years ago, it was 100 percent of the business. What percentage of revenue will you do in the next week and a half. 80 will be done by the end of next week. That is only 25 . What percentage is now electronic. How many people are Walking Around with ie pads and kindle. Very small percentage. College kids hate it. Why. For a lot of reasons. You have to write notes and highlight. We evented software to let you do that, but the fact is publicers charge you a discount, but you can rent it for 30. Why would you spend 80, 85 plus textbooks are portable and never run out of battery. Its a finance issue. I thought i like to be able to flip back and forth. Thats because im hold. You dont look old, but we know from our generation that thats the metaphor we used. As you get younger, so college kids and high school kids, you would think are the same. Act very differently. Its all about finances in college. You have to realize 85 of kids go to state school. Graduate in six years, not four. They have jobs of 45 hours a week or more and consider them parttime jobs. We did a segment yesterday on student debt and impact on retail. Why are text books so expensive and why is there not a market in the sense that you think somebody would come in and significantly undercut some of the long time textbook accomplishers. Thats what we did. We invented the textbook rental model. The model i agree with. Why is nobody coming in and saying im going to price books at half the price. Five accomplishers have about 80 market share in u. S. Colleges. To get a College Professor who is under no obligation to change anything because of tenure to change the books they use. We rent them for 10 35. So what we do is we said if youre using this book, disrupt the model. Wall street hated that model. We put 120 medical to buy books. Had to rent them two times. Changed that model. Now just recognized the 20 commission. Built a Digital Business on top of it. Youre saying andrews idea is manufacture a book and charge only 75 because theres probably margin there to be taken in. Huge margin. The issue is getting a professor to list that version of the book on the syllabus is the barrier to entry. You to have a sales force. 4400 colleges. Millions of professors. You have to sell each one individually why they should use your book versus. People are so easily bought. That can be done. They are by their nature. They dont get paid much. No they dont, but there are you cant buy them off. There are laws against that. Theyre used to teaching what they teach. Were on the 11th edition. While youre hear just talk tech with me a little bit. You know everything about the valley. Twitter. Whats going to happen with twitter. You spent part of your career at yahoo. I did. The good years. 2006 when we went from 700 million in rooef now to 5. 35 billion. Twitter is an interesting case. If you look at the spectrum of silicon companies. You start off with no revenue they generally sell early. Like instagram. Let someone else figure out your business model. If your user growth slows you can become someone like twitter or well yelp or someone stuck in the middle. Li twitter, i think is struggling not just with users. I think its losing advertisers to instagram. I dont think they want to sell, but the strong likelihood is if you get stuck in the middle and your not giving enough time and money to invest to fix it, and they dont have clarity on how to fix it. They have clarity on how to fix it, the runway would be longer. You cant get clarity bauds its not an easy thing to do. College kids hate twitter and interestingly enough, facebook, college kids dont want to have a long list of people they dont know following them. They just want their friend following them. Two questions quick. Tesla. Does this make sense to you . What are people saying in the valley about all of this. Its elon musk so people are saying its elon. Hes got a master plan. Do the rules apply . The idea hes buying bonds and trying to sell solar city to himself. Clearly the rules dont apply. Thats exactly what hes doing. He had three separate companies. Hes putting two of them together. Buying the bonds. He has a vision for this and his track record is pretty awesome in terms of inventing things. Maybe steve jobs could have pulled this off when they bought next and put it into apple. We were just talking about snapchat and what buzz feed was doing. You look at instagram in terms of stories, which is very close to what snapchat actually is. Yes. Does this take a lot of wind out of the sal sails if you wil . Not yet. You asked about twitter earlier. All the money is going to facebook and google on the advertising. Everybody else is getting whats left. Snapchat is the one getting most of whats left. Instagram has been getting it anyway as part of the facebook growth. I dont think its one coming from the other. I think if you like snapchat as an advertiser. You like instagram stories. Its so small in terms of the dollars they get. They have huge room to grow. We have to run. You were part of a Bidding Group that tried to buy yahoo and did not win. I think the likelihood that verizon and aol will keep the Current Management Team is probably not as high. And i think it would be very difficult because its one of the rare occasions where you have three brands coming together at the same time. Verizon just bought aol. I think the transaction. Perhaps shell manage whats left of it. Do you think they should have offered more. It was fairly bided. Whats disappointing is the companys value before alibaba was ten times higher than it sold for. Has a lot of structural issues, but can be fixed. Dan, thanks for coming in. Great to see you. The normal rules dont apply. Where have i heard that before . Pretty much with all of your guests. I just cant let it go. On which . Oh, you have to. Its an inside joke. You had no audio in the green room. Theyre making a clinton the rules might not apply for another guy. Elon musk. Another candidate. Coming up, mylan pharma gettingen unexpected ally in price hike for epipen. A pharma bro, well shoe you what he said next. As we head to break, a quick check on european markets next. Your Business Needs Better Technology to drive better performance. So you need it to be reliable and fast. Really fast. Introducing the comcast business Summer Savings event. Fast Internet Speed to drive performance, plus cutting edge wifi for your employees and customers, and voice mobility so your calls find you wherever you are. Get some of our most advanced products at a great price with over 500 in savings. Call today and ask how to get these savings plus a 250 prepaid card. Comcast business. Built for business. Welcome back to squawk box. The crow who is noun of hiking the price of the hiv medication by 5,000 is defending mylan. Mylan has been under fire for its own price increase of epipen of nearly 500 . Company facing scrutiny, but telling us that mylan is a good guy. Everything is thinking about the patients family. No one is thinking about mylan. People would say its a Pharmaceutical Company. They may not make a lot of money off this one particular medicine, but lets not think that these pharmaceutical companies are cbs and nbc have higher margins than mylan and mylan makes life savings drugs and cbs makes media content. Not making much money by business standards and suffered from mostly selling cheap generic drugs in the meantime the salary of the ceo was revealed. Going from making 2. 5 million in 2007 to 19 million last year. That was pretty ingenious what he did with the cbs people. You guys have much higher margins. Why do you deserve to be more profitable. Thats an insidious way. Shrek is what mrs. Shrek calls in a playful mood. Owned by Nbc Universal. Trying to plug it in. Those are great. You think there was a mistake. I called for that story on squawk. You told the guy everything you do is not calculated. Climbing, climb climb climb. And climbing the ladder. Win, every millisecond matters. Both on the track and thousands of miles away. With the help of at t, Red Bull Racing can share critical information about every inch of the car from virtually anywhere. Brakes are getting warm. Confirmed, daniel you need to cool your brakes. Understood, brake bias back 2 clicks. Giving them the agility to have speed precision. Because no one knows like at t. Cnbcs listen. Were playing the hustle. Primetime show cleveland hustles premieres tonight at 10 00 p. M. Eastern. Kate rogers is live in cleveland which, i dont know, i thought that city looked really good during the convention. So clevelands on a roll. Yeah, absolutely, joe. The metro here in cleveland ranks number 12 nationally for main street business activity. There are around 1100 established Small Businesses for every 1,000 residents in the cleveland metro. Thats due in part to help from groups which focus on helping brick and mortar Small Businesses get off the ground. In the past decade they helped launch 85 businesmall businesse their community. Neighborhoods are getting stronger. People are moving back into the city from the suburbs, from other cities. Theres a strong design to be here. Its an affordable place to live. There are a lot of amenities. Were a short walk from the beach. Its a great place to be and i think businesses will continue to succeed as long as people continue to move back into the city. Businesses like a craft soda startup here in the city say theyve greatly benefitted from that groups help. Theyve connected us to so many resources. Whether it be the building department, our councilmen, the department of public health, the division of liquor control. Theres so many people that really do want to see this become a reality and help us get there. Startups here tell us they like the scrappy appeal of the ecosystem here in cleveland as well as the availability they have to get mentorship, financing, and other resources. Of course were standing here on the cleveland mall. Its where the cavs ended their championship parade thanks to lebron james, of course. And his new show cleveland hustles premieres tonight at 10 00 p. M. On cnbc. Im going to be watching here from cleveland. Back over to you. All right. Great. 10 00 p. M. Thanks, kate rogers. Looks great. Thank you. Okay. Coming up, when we return our guest host today knows what it takes to get consumers out of bed every morning. Were thrilled to have him here because he brought doughnuts. Yes, these are National Waffle day. Hes going to talk consumer, coffee, consumer. Its a dessert. Where we explore. Protecting biodiversity. Everywhere we work. Defeating malaria. Improving energy efficiency. Developing more clean burning natural gas. My job . My job at exxonmobil . Turning algae into biofuels. Reducing Energy Poverty in the developing world. Making cars go further with less. Fueling the global economy. And you thought we just made the gas. Energy lives here. Stocks looking to add to yesterdays gains as investors eye Janet Yellens speech on friday. And steve reese shares three stock strategies as we head into fall. Plus dunkin chairman and ceo nigel travis on the consumer coffee prices and, yes, doughnuts. Donald trump doubling down on his call for a special prosecutors to investigate Hillary Clintons emails as he gets ready to win florida. Eric trump joins us to talk about his fathers run for the white house and the future of the Trump Organization. Breaking news overnight. A strong earthquake strikes central italy collapsing homes, destroying buildings. Well get you the latest from italy in and ongoing rescue efforts as the second hour of squawk box begins right now. Live from the beating heart of business, new york city, this is squawk box. Welcome back to squawk box here on cnbc, first in business worldwide. Im joe kernen along with Michelle Carusocabrera and andrew ross sorkin. In studio for the rest of the show, nigel travis, Dunkin Brands chairman and ceo. Lots to discuss with him including the election, the economy, minimum wage, business conditions, National Waffle day. We mentioned waffles. You think doughnuts and you brought waffles. We have. We always bring good stuff, joe. You always do. Thats true. The futures at this hour, i dont know. National waffle day, doesnt everyone feel see . Starting to tick higher. Good feelings spreading throughout the world. Its the maple syrup. You know what age group likes waffles the most . Old and young. All of the above. Hes not joking. There is. I know. But unfortunate story out of and you dont think of necessarily earthquakes in italy. Theyve had them before, but you dont. A developing story out of italy to tell you about. There was a strong earthquake which struck central italy. Two hardhit towns where rescue crews raced to dig out survivors from the rubble. It was felt across the broad stretch including the capital rome where residents felt long swaying followed by aftershocks. We will continue to monitor throughout the morning and bring new details. Lets talk about headlines making news this hour. Astrazeneca planning to sell abts to pfizer. According to the wall street journal, pfizers going to be paying 725 million for the antibiotics business. Plus an additional 850 million depending on the commercial success of those drugs. Also layzboy missing forecasts. Recliner maker hurt by weaker wholesale demand and lower foot traffic at its stores. Then intuit misses. Youre looking at it down almost 5 after the companys First Quarter outlook came in out of forecast. Spotify looking to negotiate with record labels. Gearing up for a Public Offering that would happen next year. Needs to obtain the rights to play music in years to come. Spotify pays nearly 55 of revenue to artists and labels. And an additional 15 to song writers. Im doing this again. You ready . You got the thing ready to go . Ive got all this materials. Bring it on. Lets not do okay. Because theres people that really, its like so torn. 50 feels one way about Hillary Clinton. 50 feels the other way. 50 , maybe 40 feel that way about trump. Were in a divided nation. But im just going to read what they put here. Without any editorial comments. I want to add one footnote when youre finished. Then im not going to read it. Go for it. In politics Hillary Clinton is that correct so far . So far, so good. Is she coming under fire . Im not pushing back on that. Shes come under fire following a report how donors to the foundation got access while she was candidate. An ap review of state department calendars showed that more than half of the people outside of the government who did meet with secretary clinton while she ran the state Department Gave money to the Clinton Foundation. All good so far. 85 donors who met or spoke to clinton contributed a combined 156 million to the foundation. So far . So far so good. Not that you like it, you just dont disagree with anything. I dont like it either, by the way. As a citizen. The optics of this are terrible. Donald trump accused the clintons of setting up a business to profit from Public Office. Heres what he said yesterday at a rally in austin, texas. Hillary clinton is totally unfit to hold Public Office. It is impossible to figure out where the Clinton Foundation ends and the state department begins. And Donald Trumps son eric will be joining us at 7 30 a. M. Eastern time this morning. What do you think about a special prosecutor . And ive heard people say the fbi already weighed in on this. Comey went to Great Lengths to say he didnt say anything about the Clinton Foundation and what was in the emails. It was about the security so they could theoretically look at this again. Ive always said the optics of the foundation and her work in the state department has never been a good situation. Never, never, never. However something needs to be looked at. My question is show me an email. There are 30,000 that have been released. Show me one where you think theres a lie or problem in the email. Theyre all lawyers. Shes a lawyer. Hes a lawyer. That would be one of the 15,000 we havent seen. Perhaps. And im not telling you we shouldnt look into it. I think just the suggestion that this foundation is a slush fund for the family is inaccurate. Because what we did talk about earlier is the money is being used for good works. I know you dont want to believe that. It happens to be the case. Why should anyone in that foundation fly commercial . It is being used to prevent standing in security lines. Most of the travel is being paid for by his speeches. Now, you can have a problem with his speeches. Thats a separate issue. But its not the foundation. You made one comment about the canada piece of the foundation earlier. In two years you had talked about where a lot of the money went to overhead opposed to right. But context is important. If you do from 2010 to 2014, 85 of the money actually did go to charity. So i just think that, again, yao got to and im not here to defend liars number, whatever that is. Figures lie. Everybody takes a position. I think weve got to be balanced about how we look at all of it. We can talk to eric trump about this. Hell be balanced. The nasdaq reaching a new alltime high on tuesday as the markets look forward to Janet Yellens speech on friday. Joining us now is steve reese and also jeff saut. Good to have you here. Is this going to be meaningful on friday . I dont think so. I think its going to be more of the same, we dont expect a fed increase in september. December is more likely. Were not expecting change in her commentary. What if the whole world of bankers end up in jackson hole . Right . What if we get very clear messages that theyve given up on negative Interest Rates. That would be significant, wouldnt it . It would be. I dont think theres a lot of expectation theyre going to go more negative. I guess from some degree, that would be a mild positive for markets. Were not expecting much move in markets either way into friday. I do think the market feels a bit complacent. August in hindsight is different than years passed. One thing were telling clients to do is to rotate out of the broad market that have lacked consumer discretionary. What about friday . Do you think its going to be significant or not . I do not. I thought you should do nothing. Take holiday like the people in new york. Theyve gone up to the hamptons. And the markets are going to flop and chop into friday. Im with your guest. I think nothing comes out of the meeting. In fact, you know for the past three months i have said i dont think the fed is going to raise rates until after the president ial election. Well, what do you think about steves advice in terms of rotating out of the Broader Market into more specifics that have lagged . I like consumer discretionary. If you listen to the ceo of paychex about a week and a half ago, Small Companies are their clients. He said the average wage increase was 3. 75 . Across the board. I think wages are starting to hook up here. I think the economy is actually stronger than the superficial figures suggest. Nigel the ceo of Dunkin Donuts is here. I know you think about wages a lot. Were seeing a rise in wages specifically for your employees, right . Weve seen a rise in wages in our franchise stores. One of the reasons is the Biggest Issue they have is finding labor. And weve got this very strange aspect of the economy that our franchisees cant find the labor. But weve got youth unemployment at 11. 5 . Thats an issue thats got to be solved over the next period. I mean, its a big concern to me that youve got a group of people who just arent employed. Is it that they dont want to work or theyre not worth the high cost of minimum wage . I dont think its anything to do with minimum wage. I think in some areas im told their parents dont want them to go into our industry which i think we have to change that aspect of the story. This is an industry that gives people their first chance of working. The first step on the ladder. And a lot of parents seem to dont seem to understand that. Were the industry that gives people the opportunity to learn how to check in, that disciplines, dealing with customers, computers, i could go on. Interesting. I want to discuss this more. We have an entire section devoted to you. Lets get back to the stock market but this is interesting. I mean, what do you make of that in terms of what it says about the higher wages is definitely good for the consumer. Weve seen relatively good Consumer Spending year to date. Theres been some pockets of weakness. If you look at the discretionary sector, its all over the board. In places like autos. What kind of yields you get there . Depends on the company. You could get 2 to 3 dividend yield. Thats been our playbook all year long. From here, though, youve got to be selective. Were focusing on places like ecommerce. A place that cant be replaced by online consumption. And the trends there have been a bit softer. Jeff, final word. Piece of advice for viewers right now . I think the markets are transitioning from an Interest Rate driven bull market to an earnings driven bull market. I think that will become evident when we come up against comparisons of last year. All right. Good answer to what ultimately would have been my question. What else drives this market other than the low Interest Rates. Good to see you this morning. Great to see you. You probably heard by now tesla model s and x are getting an upgrade. Phil lebeau joins us. Really fast. Is there a reason to think that this stuff around the edges is significant . How do you address just the specter of not making production goals again and again and again. Thats the latest wrap on tesla. What does this do to help with that . Weve heard that wrap for some time. We wont know until we get the Third Quarter delivery numbers until the first week of october. Weve seen b this in the past. If theyre going to fall short in the Fourth Quarter, well hear that warning in the Third Quarter delivery announcement. How much will this new battery pack change things . A little bit on the margins. Because youre talking about the most expensive model s and model xs that will be impacted by people upgrading to the 100 kilowatt battery. What does that mean . Greater range, greater speed. Take a look at the model s 9100d. 0 to 60. It is the fastest production car that will be offered in the market. 2. 5 seconds to go from zero to 60. And the price will start at 134,500. Heres the Conference Call talking about the significance of the range going beyond 300 miles. With this youll be able to travel assuming its not a super hot day or something and you maintain a reasonable speed, youll be able to travel nonstop from l. A. To San Francisco. And remember california is the largest market for tesla. This is what everybody is focused on. The number to focus on is the right there. 80,000 to 90,000 vehicles delivered this year. That is teslas own guidance. The company says it will get there. That its increased its weekly production to about 2,000 vehicles. By the end of the year you will see them make at least 80,000 deliveries. Quickly take a look at shares of tesla. Yesterday this stock was up pretty decent amount once elon musk announced there was going to be a product announcement. Had everybody saying theres a new one. Its a new battery. That is significant if youre a potential buyer. But is it going to move the needle a whole lot . Probably not. Thats what people need to keep in mind. Weve got to keep that in mind at the end of the day Going Forward. You can keep it in mind now. I know. Now instead of Going Forward at the end of the day. There is a nissan that goes 1. 5 seconds that i think youve told us about. Legal streetcar. I looked up to see what drag racers do, and i did not know this. 0 to 60, you got a guess . 0. 2 seconds. Thatll get your attention, right . Yeah. 0. 2 seconds. Because we can all buy a dragster. 2. 5 is, i dont know who needs that. I guess if you need to merge. You know . You need to get in front of someone. If youre in that right lane. Could you use that . Joe, having driven these vehicles in ludicrous mode, you dont use it a lot. But when you do want to accelerate, you can do it extremely fast. That is cool. Lets hope they can make enough to sustain business and that the u. S. Government gravery train continues along with it. Thanks, phil. You bet. Coming up when we return, were going to talk business conditions, coffee prices, and the consumer with a guy who actually owns a tesla. Nigel travis. Maybe well you dont have ludicrous mode do you . No. Its not out yet. At the bottom of the hour, eric trump, son of donald trump, hes going to be our special guest right here on squawk box when we return. We call it dark data. 80 is invisible to most businesses. The ibm cloud has tools that can help see dark data and put it to work. Hello, my name is watson. Working with watson in the ibm cloud, we can help an Energy Company predict pipeline corrosion. And help a startup to use social data to predict market trends. Now businesses can get more out of their data. Thats what the ibm cloud is built for. Your Business Needs noBetter Technologywho wants moreto buy ttheir data. To drive better performance. So you need it to be reliable and fast. Really fast. Introducing the comcast business Summer Savings event. Fast Internet Speed to drive performance, plus cutting edge wifi for your employees and customers, and voice mobility so your calls find you wherever you are. Get some of our most advanced products at a great price with over 500 in savings. Call today and ask how to get these savings plus a 250 prepaid card. Comcast business. Built for business. This morning. Lets get to nigel travis. You brought some doughnuts and coffee. And waffles. National waffle day. Next week weve got a new sandwich coming out. Belgian waffle sandwich. Its really golden, bacon in the middle. Whoa, whoa. Wait a minute. Waffles and bacon . At the same time . Those are the two major food groups. Major food groups but they taste fantastic. Okay. I want to talk jobs for a minute. Get back to the conversation we were having earlier. You said now, this is on last months Conference Call, if you ask franchisees what their Biggest Issue is theyre having right now, it is finding people. Absolutely. Thats a surprising issue. Were relatively full employment. I think wed all agree with that. It was 4. 9 then 4. 7. These guys might not agree with that. Ive been told the economy is terrible. College graduates are employed. But if youre a High School Graduate or less than a High School Graduate, unemployment is much, much higher. It is. But there is still difficulty finding jobs. And ive recognized its regional. Certain parts of the country. Fing you take the coasts, its really difficult in our heartland, in boston, massachusetts, new york. And other parts of the country its easier. But fraz zees will tell you thats the Biggest Issue facing them. But you said youth unemployment was very high. You were concerned about the fact that kids didnt want to work at Dunkin Donuts because their parents didnt want them to do that. Thats one of the things we hear. The thing i cant understand im not saying thats the total reason. 11. 5 i think wed all agree is a high youth Unemployment Rate. Thats between 16 and 24. The question is why arent they working . I think one of it is their parents dont want them starting out in our industry. As you said you worked in pizza hut. Working in a restaurant is a great first jo b. Great first job. I worked in a Retail Establishment in london. It gives you all the disciplines. And our industry, i think, is people dont understand that it really gives people the start. It gives them all the disciplines and gets them into why hard to find you would think given the unemployment picture among the people that michelle were just talking about, that they would be running to go after job offers. I think its the attractiveness. I think sometimes its also the processes. Ive been advising a kid up the road about getting a new job. I think theres so much thats gone online, it is difficult for someone to identify the jobs. I think one of the things i would encourage young people to do is go bang on the door at Dunkin Donuts and mcdonalds or wherever and ask them to start. The people in our industry, the people who progress can progress quickly. Store managers, district managers, et cetera. If you havent got anything else to do being a graduate or not a graduate, try our industry. Because its a great way of progressing. And then you can move on to other things. I want to talk about the dunkin brand for a minute. You may have missed this, maybe you saw joe. Maybe you were up watching worldwide exchange. They were talking about starbucks versus dunkin and how millennials one being a blue collar brand and one being a white color brand. Theres an article saying youre trying to be more of a white collar brand opposed to a blue collar brand and youre stuck in the middle. What do you think about that . I think people have always regarded us as been in the middle. The way we look at it is we are a Beverage Company. Were a Beverage Company and were a to go company. One of the things weve done and i think very well over the last three, four years is really go after millennials. I was reading an article this morning that generation z comes behind it, go to restaurants a lot. Generation z, 22 of the customers of our industry. Weve launched cold brew which has been a very successful launch. Its a change. Millennials love cold brew. They love iced coffee. Were the Market Leader in iced coffee. They love technology. We launched our app back in 2012. Weve now got 5 million perks members. Its probably the Fastest Growing rewards program in the category. Only two weeks ago for Baskin Robbins our other brand, we launches their app. It blew away our expectations. We beat our years total in the first two weeks. I know you create jobs and i know, you know, Shareholders Benefit and you provide a great service, but why dont you actually do something good for society like Howard Shultz and start giving the token feel good expressions . Pretend you care about the big issues. You know, pick your issue and start getting involved and actually be a Productive Company like howard. A do gooder. And someone who can preach to other people on how to live your lives. Why dont so, joe. I take the cynicism. But no one whoa, whoa. Where . Where was cynicism . Hold that thought. Do something good for the world, would ya . Then the millennials will come. Still to come, eric trump on his fathers bid for the white house. Usic playing] [music stops] woman looks like its done. [whistle] [dance music playing] [record scratch] announcer dont let salmonella get funky with your chicken. On average, one in 6 americans will get a foodborne illness this year. You cant see these microbes, but they might be there. So, learn the right temperature to cook each type of meat. Keep your family safe at foodsafety. Gov. Coming up, eric trump on his fathers bid for the white house. Hillary clinton and the future of the Trump Organization. U. S. Equity futures right now indicated theyve been between 5 and 15 so far. Not a lot happening. Squawk box will be right back. But were expecting Something Big to happen soon. I swear we are. Welcome back to squawk. Morning the stories front and center, were looking at the Major Development where the quake hit in italy. The 6. 2 quake was recorded at about 9 30 p. M. Eastern time last night about a hundred miles northeast of rome. Several possible aftershocks. At least one with a magnitude of 5. 4 were recorded the hour following that initial quake. As of now there are at least 37 reported casualties. That number expected to rise. Lets switch gears to Corporate News. Hard to make that zrigs. Astrazeneca will sell part of its Antibiotics Division to pfizer. Also this morning, teslas elon musk revealing an amped up tesla battery. The new packs should power the model s and model x cars from 0 to 60 in under three seconds. But production will be limited at first. Able to get from l. A. To San Francisco on one charge. Which is the bigger news. Should i read this . If im going to read this. The other day the second day that you walked by, eric trump, the first day you just you were focused. I dont know what was going on. You were thinking about something. Thinking about the campaign. Thinking about i dont know, talking points. But we got you the second day and you were walking by and we set this interview up through the window using lip reading. Through two panes of glass. I dont know if you knew that we were did you know we were on then . We were totally live. No, i didnt know you were live. But i walk bid and say that was impressive. Joe picked me up as i was walking down the street. Hard to say no after that. Must be good looking or something. When tens of millions of viewers see us talking to you, hard to say no. Eric trump is son of the republican president ial nominee. So many places to go. Latest i heard on the immigration deal is on a hannity town hall, your dad kind of conceded that you dont necessarily want to be hardhearted and go and disrupt families and maybe go in and take 13 million people, some type of task force and throw them out. So there is some softening of the stance there. Safe to say . Youve known my father for years. He has a heart of gold. At the same time he believes in this country and he believes in borders and he believes in legal immigration. So listen, as a country were a melting po t. My moms an immigrant. She came from what was czechoslovakia at the time. Its not about, you know, not being for immigrants. Its about having a Legal Process where people can come into this country legally and we know whos coming in. My father wants a safe country. He wants a Median Income hasnt gone up in 15 years. And you have people coming across the border and you have proposals to let in hundreds and hundreds and hundreds of thousands of syrian refugees. Weve just got a lot of problems in this country. Weve got to take care of our own first. Thats kind of my fathers theme. The first time you walked by Kellyanne Conway was here. Weve seen her talk about theres paths, all right . What was your i think your dads first book was what art of the deal or something . Everythings negotiations. So theres one path towards, i guess, the end result hyperbole is totally open borders. I saw juncker said the worst thing man invented was borders. Thats one path to go down. Let in as many syrian refugees. The other is to start enforcing the law to some extent. Build a wall. I dont know whether it includes deporting people that are already here. Sure. But you can look at it just philosophically. And i dont know if hes going to get hit for flipflopping on an issue the left hated from the start. But theyre going to hammer him for not sticking to sending in guys honestly i dont think its flipflopping at all. His message has always been clear. Its America First. Right . Its America First. Weve got real problems. We have a lot of people out of the workforce in this country. I mentioned Median Income before not going up. Weve got real problems. We dont make anything anymore. John harwood yesterday was doing sound bites where he said before send them all home. Now hes a different position than sending them all home. Tell me about that evolution. I think it develops. And i think hes going to come out and speak very, very specifically about it. He has a couple speeches coming up as you know very well. But again, his mention is America First. He will build a wall. Believe me. If i throw out his tax returns, will you steal his thunder . I just have one question on immigration issue. From the l. A. Times today, theres a ad the Trump Organization is running that says that under Hillary Clinton Illegal Immigrants convicted of committing crimes get to stay collecting Social Security benefits skipping the line. It says that unauthorized workers in the United States are not permitted to collecting Social Security. Is that hyperbole . I dont know what that is. I havent seen it. But you had people where youve had Illegal Immigrants who came back in, got deported. Came back in, got deported. Then they end up killing a beautiful, beautiful woman on a nice saturday afternoon or whatever it was at the time. And the reality is we have a problem. I think my father wants to address the problem. He wants to keep america safe. He wants americas workforce to be productive. And he wants america to come first. His immigration plan will take all of that into account. Everything is a negotiation. I think you said it perfectly. Everything is a back and forth. You have to figure out a system that works best at the respective time. But, you know, under his plan, america will come first and american jobs will come first. So you tweeted that you were going to come on. Ive blocked people that disagree with me. So ive almost got rid of all of them. But you have opened up another pandoras box. Im seeing the people that are responding to you coming on the show. Its a cesspool. Its hideous what i see coming in here. So i just wonder what its like to be Donald Trumps son given the animus youre seeing from his enemies, from his opponents. Are you thick skinned . Because i think your dad needs thicker skin sometimes. I started my rnc speech, i said the first thing we talked about was family when he said were going to hop into this race. First thing he said was were going to learn who our true friends were very quickly. And we very much did. We spent our whole lives Building Hotels. Im a civilian, im not a politician. Its amazing, the second you enter a race you immediately become half the people hate you and half the people love you. At the same time i could tell you coming down here this morning, i had a hundred people who literally grabbed me and said tell your father to go all the way. The movement that he started is incredible. I dont have those people coming up to me saying, listen, i dont like your father. I walk by construction sites, construction workers will grab me and say i want a picture with you. Your father is the greatest thing. Ive had people saying our whole family is behind you. He still responds on twitter he punches down at times. And he never starts it, i admit. Its always in response to what he perceives as but doesnt this country need a fighter . Doesnt this country need a bit of a fighter somebody. You got to pick your battles though. Sometimes it gives gris to opponents. You need thick skin in this business. Especially trump. I think hes got a thicker skin than anybody. The amount of bullets hes taken throughout this campaign, the amount of oh, i know. Untruths and Everything Else thrown at him. Versus what he says and what the other candidate does. Hes got a lot of pride and dignity. He will stick up for himself. By the way, hes a person sticking up for america. Because hes bringing up things that are often unpopular, that arent necessarily fun to talk about. That arent soft and cuddly. But need to be addressed in this country. A commander in chief has to do that. You cant just run away from the tough issues. Help us with this. It was where joe was going earlier on the tax front. I get emails i wasnt going there. You wouldnt have anything to say i get emails from the campaign talking about wanting more transparency from Hillary Clinton. You mean like a press conference. By the way, i would not dissuade you. I think she should have a press conference. Many more press conferences. Just a thought. Warren buffett challenged your father to release his tax returns. Says theres nothing preventing him from doing so. The irs being audited does not change the dynamic. Thats nonsense though. There is no tax attorney in the world who will tell you to release your tax returns while youre under a standard routine audit. It would never happen. I mean, anybody who thinks that is in la la land. But i also hear these conspiracy theories all the time. You dont learn that much from a tax return in all fairness. I heard someone the other day, trump has ties to the mob. If he released his tax returns you would clearly see that. Are you guys kidding me . You learn a lot more when you look at a persons assets. You know how many hotels we have around the world. You know how many golf courses we have around the world. You know every building we have is that dot this very street. In fact, we have one right behind us. 1290 which we own a portion of. Theyre going the take his total for example, with romney, that was what harry reid which apparently there was nothing to that all along. But he used that as a talking point. And then took credit for helping defeat romney when he said, hey, it worked. But if he did if he has a Real Estate Tax rate that allows him to have depreciation or whatever, it brings him down to anything below his secretary, theyre going to use that. If his fiphilanthropic contributions arent fair enough in the eyes of the left, he sets himself as a philanthropist. To me if you pay your taxes and try to lower it to the least amount. Ive seen guys like tim kaine and others disparaging his business career. People that have never had a private sector job disparaging. Hes not worth 10 billion. Maybe hes only worth a billion. If you have a tax return, then at least everybody knows. All of the questions get dispelled. Right . And all the questions of how much money has he made Warren Buffett has supported Hillary Clinton eight years ago. Supported barack obama for the last i mean, that is not a saying Warren Buffett thinks thats a good idea. Hes totally conflicted. Im suggesting theres no legal requirement theres no legal requirement that thats like carl icahn saying Hillary Clinton should have a press conference. But theres no legal tax attorney that would say publish it. By the way, the tax return, its five feet tall. You would have a bunch of people who know nothing about taxes trying to look through and trying to come up with assumptions on something they know nothing about president it would be foolish to do. Im the biggest proponent of not doing it. Hes under a standard audit. You just dont do that during that time. Go ahead. Kellyanne conway brought up the other way the left is going to make this about tone and temperament. Youre trying to make it about facts and figures. We are hear that. Whatever you think of the platform, they worry he is a crazy megalomanic and hes got the wrong temperament for the job and that is a stopping point for a lot of independents and republicans, frankly. Hes an amazing man. He raised a great family. Hes built a great business. Hes an amazing, amazing man. You look at tone. You dont even hear Hillary Clintons tone. Its been 270 days since shes given her last press conference. You see this morning a report that about 75 of the people of all civilians that saw her during her time at the state department donated hundreds and hundreds of thousands if not millions of dollars. You see the pay to play thats happening. You see her lying to the department of justice. Right . And to the fbi. And deleting 33,000 emails. Now another batch of 15,000 emails comes out. You see main aides of her that not only work in the state department but are also working on behalf of a foundation. You see 35 million coming in from a country like saudi arabia and then bill going around and giving speeches for 400,000. I mean, the clintons made 141 million between the year 2007 and the 2014 all of which time she was in government. I mean thats not the foundation. Thats them. But that was giving speeches for the foundation. Listen, i have a Great Foundation for st. Jude. By the way, these guys do amazing jobs. Dunkin donuts do Amazing Things for st. Jude. I dont get paid for that work. You donate your time to a great cause. Bill clinton is getting 400,000 to give a speech for his own charity. This is insane. Its criminal. You do philanthropy for the right reason. Not to go to a foreign country and get a check from your own foundation. Its not right. Its not right to get that money and give it back to the foundation. They made 141 million from taking money from these groups. Its horrible. Look at this iranian deal, right . 145 million comes into the Clinton Foundation. The state Department Approves that 20 of the uranium of the United States this is a material to build nuclear weapons. 20 goes to russia. Why is the Clinton Foundation getting 145 million after a deal like that happens . This is criminal stuff. Its bad, bad stuff. Its pay to play. And were americans. We deserve better than that. I was thinking look at haiti. If you look at detailed at the time, you know, bush is down there with bill clinton. But you look at actually the way the money was spent. Every construction company, every supplier, every Person Associated with rebuilding haiti was some there were rodhams involved and, you know, you could see the tentacles of the entire clinton machine and everything that was done there. Even look at Loretta Lynch hopping on that private jet with bill clinton on a random tarmac in the middle of nowhere. This is corruption at the highest level. And again, we are americans. We are the antithesis i mean, this should not be happening. It should not be happening. And it makes the whole world question our system. You know, we are the leaders of the free world. Why are we doing this . There are some conservatives, eric, that dont see a consistent conservative stance and that your father went back on the minimum wage. Now maybe it is a good thing. There are those that think that theres not enough absolute certainty that once he does get elected, hes going to actually, you know, govern as a conservative. What would you say to people that he hasnt got itd be nice to get 100 of the republicans on itd be tough to beat Hillary Clinton if you dont have the party. You heard him last week he was talking about africanamericans and inner city youth. His whole platform for last couple weeks has been talking about africanamericans and how we as a society need to focus on those inner cities and provide jobs and opportunities. That is revolutionary for the Republican Party. When was the last time you heard a republican come out and really talk about these . Look at the rnc. We had a gay man speak at the rnc and my father spent a lot of his time talking about the lbgt community. That is revolutionary for the Republican Party. Theres a lot of things that hes doing very differently. Theres a lot of believes that he has. I think the Republican Party has almost become an America First party. You know your dad and you advise him. Reagan was a democrat and was i think president of a union at one point. He turned into what would be called a bona fide die hard conservative icon. Can people change . Because your dad in the past wasnt necessarily a conservative. Do you feel when he gives that Supreme Court the list, those are the people hes going to choose . Theres no question. So he is a bona fide i think people can change over time. Ive changed over time. I was never a politician. I was never having these conversations. I was Building Hotels all over the world. Ive changed. Every time you peel back a layer of this onion, every time you see a scandal within government. Every time you see Something Like 150 billion going over to iran, a country that hates our guts, i think your views on politics and the views on the governance of this country change. And i think thats especially true for somebody whos never been in government before. So i think views will evolve and change, but i think they really get refined over time. If you had more time, what we have music playing. I hope youll come back and talk about the impact of the tax plan both on the economy but also on the Trump Organization because Everyone Wants to understand some of those issues. And i think there are some other issues and a media empire he could build if theres a media issue. Theres a deal of dealing with the press. Theres a lot more to talk about. I hope you will come back. Appreciate it. Thanks. Coming up, bringing home the gold. Gold medal athlete from the rio olympics joining us after the break. N mean the difference between life and death. For partners in health, time is life. We have 18,000 people around the world. The microsoft cloud helps our entire staff stay connected and Work Together in real time to help those that need it. The ability to collaborate changes how we work. What we do together changes how we live. Inside everyone is an incredible cook, someone who can cook an amazing meal any night of the week. Farm fresh ingredients, stepbystep recipes, delivered to your door for less than 9 a meal. Get 30 off your first delivery blueapron. Com cook. With this level of engineering. Its a performance machine. With this degree of intelligence. Its a supercomputer. With this grade of protection. Its a fortress. And with this standard of luxury. Its an oasis. Introducing the completely redesigned eclass. Its everything you need it to be. And more. Lease the e300 for 549 a month at your local mercedesbenz dealer. Mercedesbenz. The best or nothing. Welcome back too squawk. Gwen jorgensen went from her cubicle to triathlon olympian in just a few years. How did this all happen . Great question. Yeah, you know, i grew up swimming and running. I actually was working as a cpa when usa triathlon came to me and said we think youd be good at triathlon. And you were training while still being a cpa . I was. After 2012 you went not pro but you decided you were going to do this fulltime. Or at least train fulltime. When i qualified for the 2012 olympics, i took a leave of absence from ernst and young. I think im still technically on that leave of absence. What happens then . Show the gold medal. Its pretty crazy to think about and have. You havent tried to chew on it . I havent. They do that. Its not chocolate. Why do they do that . Do we know why they do that . To pruf its gold . Yeah. What happens next . You have sponsors. Youre going to florida. Yep. Theres two more triathlons i have on my schedule. The World Championship and then a race, the island house which is in the bahamas. But im really ready for a new challenge. Im excited to announce im going to be doing the new york city marathon. Wow. When they came to you, you had done triathlons already . I had never. So you had run. At that time, how many miles a week were you running when they came to you . I mean, they knew that you yeah. I had been an allamerican, ncaa allamerican in running at university of wisconsin. You try to run a five minute mile . And then you try to run 26 of them . Thats something i would recruit someone who could do that. Im smart enough to think you might be good if the olympics. If you can run 26 fiveminute miles. Wouldnt you . Thats how they knew. Then swimming you were really, really good at swimming . I grew up swimming. Wasnt great. Never made ncaas when at the university of wisconsin madison. But you were behind after the swim anyway, right . And then just totally kicked it. I was at the olympics, yeah. You want to weigh in on lochte while we have you . You know, i was really focusing on myself while i was at the olympics. Personally me, i had a great time in rio. I stayed on copacabana. I just had a great time while i was there. Do you drink red bull before your competition . I agree it before and during. So actually while i race on my bike i have my Water Bottles filled with red bull. Wow. That is a true endorsement. Have to ask you a question about weve got to run, unfortunately. Oh. Just amazing what youve done. Weve got to run. We do. And swim. And bike. Investors awaiting Janet Yellens speech on friday, we have a preview of her message straight ahead. Here are the futures at this hour. Amazing sleep stays with you all day and all night. Sleep number beds with Sleepiq Technology give you the knowledge to adjust for the best sleep ever. The time is now for the biggest sale of the year, where all beds are on sale save 50 on the labor Day Limited Edition bed. Know better sleep. Only at a sleep number store. To raise or not to raise . Thats the question. Exclusive results from the fed survey and a key read on what investors want from janet yellen straight ahead. Your money, your vote. Holman jenkins makes the case. Cracking the code. Students are hacking their way into jobs. The final hour of squawk box begins right now. Live from the most powerful city in the world, new york, this is squawk box. All right. Welcome back to squawk box here on cnbc. Is it 8 00 . It is. First in business worldwide. Im joe kernen along with Michelle Carusocabrera and andrew ross sorkin. Becky is off today. Our guest host this morning is nigel travis, chairman and ceo of Dunkin Brands. We have another olympian. Is that you . No, no. Thats holman jenkins. Hes an olympian to me. As he knows. You dont even have a bronze . No. I didnt bring any of my medals with me. Well have more from him in a moment. But first, if you havent heard this morning, there was a story out of italy that were talking about. A developing story. A major earthquake hit the central part of the country. The magnitude was 6. 2. It was recorded about 9 30 p. M. Eastern time last night. It was 100 miles northeast of rome. And there were several large aftershocks that followed. And as of now, there are at least 38 reported is that casualties . I thought that was the dead. But it could be just i dont mean just. Separately a 6. 8 magnitude earthquake hit myanmar this morning. It was felt several hundred miles away in thailands capital. No word yet on the amount of damage in that quake. Some of the first video weve seen come in from italy since the joer night. Among todays top business stories, Mortgage Rates fell 2. 1 but the volume of applications was still 28 higher than the same week a year ago. Refinancing applications fell 3 from the previous week. Were going to get more housing data at 10 00 a. M. With july existing home sales. Astrazeneca has agreed to sell part of its antibiotics business to pfizer. The deal could be worth more than 1. 5 billion depending on the success of the drugs in the portfolio. The progress of drugs still in Clinical Trials as well. And the New York Times says its Moscow Bureau was targeted by a cyber attack this month. The hackers are believed to be russian. There was no evidence they were successful. Couple stocks to watch this morning. U. S. Trade judge ruled that fitbit did not steal jawbones trade secrets. Jawbone accused fitbit of poaches on patents and employees. Separately samsung saying demand for the new galaxy note 7 outpacing display. Samsung could sell as many as 16,000 this year which feature a curved screen. Then theres layzboy. Do you know if anybody has one . I would be shocked if you knew anyone with one. People were sitting outside and there was a layzboy outside. Which is what i want. I go to the Movie Theater where theres a lot of layzboys. And some have refrigerators in the arm. Cup holders. They say its for grape soda. I might use it for something a little stronger. Nonetheless, layzboy posting a surprise drop in Fourth Quarter sales. Missing forecasts, the recliner maker hit by lower foot traffic at its furniture stores. I think the we were talking deaths. Casualties would be much larger than that. Lets check on the markets. Theyre up about 5. Now up 11 on the dow. S p up just under two. Europe was in the green for most of the session while weve been here. It continues to be in the green except for the ftse which is down just fractionally. Asia, well take a quick look. Not a lot happened overnight. The shanghai continues to trade above 3,000. The nikkei up about a point. Okay. Now lets talk politics. Our next guest says donald trump is a win win situation. The Republican Party is along for the ride. Joining us now is holman jen kigs. Hes an editorial writer and member of the editorial board. His latest oped is titled, trump wins even if he loses. You are a gold medal winner to me. Thank you. Very flattering. Im not sure i totally agree with the article. What do you mean by win win . Hes not spending a lot of money on this campaign. Hes reaping a huge bonanza in media impressions as they say. Media exposure. Brand recognition. You know, when he brought in steve bannon last week, i think everybody began to get the idea this is partly about building a media empire thats going to last beyond the election. You suggest this is not a serious effort over the past couple months. In many of your columns. You suggested that or raised the question that its not a serious effort. I think it began as a lark and i think donald trump is surprised at the prairie fire he started. I dont think he praelzed what he has to do. Hes starting to run tv ads. Hes starting to reach out to a bigger audience. Hes starting to down the message. Become more inclusive and upbeat and positive. He really has a terrific starting point. We just had eric trump on and asked him the question, why doesnt he make his tax returns public. He said that theres not a lot of information in there that the public needs to know that you can learn from. Does that make any sense to you . He doesnt want the public to see the tax returns. Thats why. Hes got a lot of good reasons. Im sure theyre massive and complicated and theres a million things you could make a fuss about. It would be a threeweek story because people would spend three weeks digging through them. Do you want to see them as a citizen . No. I dont care about that. I know who donald trump is. If theres not evasion and breaking the law, then you know theres going to be every possible avoidance mechanism known to a real estate person is going to be in there which is going allow the left to question. Theres going to be all that. But theres nothing about breaking the law, then what i know whats going to be in there. But it certainly would be a threeweek story. And it would be a people have different ideas. The left has an idea that theres something called a fair tax rate. Where from the very beginning thats a ludicrous idea. But your article is that its a win win for trump. You talked about the one win which is he gets all of this publicity. Even if he loses its a win for him. However, your piece is pretty negative on trump. You suggest that if he wins, its a positive for the economy, its a positive for the markets and employment. Because she doesnt win. And he by default gets the benefit of the fact that hes not going to push more regulations. Hes perhaps going to get a new tax code. Yeah. Somebody reading it would conclude you want him to win. Hold on. You say without doing anything, he would get a boost from the markets and gdp. Thats not anything hes doing. Exactly. Its just the creation of possibilities. Suddenly tax return becomes a doable item. Doing something about obamacare is something rather than just letting it run off a cliff. The whole onslaught gets called off overnight. Hes saying when you take away what the economy has been holding down the economy, thats going higher. And thats not where you wanted to head with this, i dont think. Well let me ask you a different question. Which goes to the foundation issue. Yeah. What do you think should happen . The Clinton Foundation . Yeah. Do you think it should be shut down . Yeah. I think they should just wrap it up. I think bill clinton should take a long vacation. I mean, you cant have this going on where shes making decisions in the white house 24 hours a day and hes out there buck raking and making noise and doing little favors for all of her supporters to help them meet this and that person. Is there anything he or she could do that would satisfy your view of the world . Just wind up the thing. And bill clinton, he can get another kind of job. You know, he could head the World Wildlife fund or Something Like that. The question is if they came out at 10 00 this morning and did a press conference and said were winding it up, people, would that change the outcome of this election . No, i dont think so. People who didnt like her before would say now its okay . No. I think shes going to win anyway. Thats the problem. But it would make her more effective as president to not have that hanging over her. My father thought this was Donald Trumps springtime for hitler that he started this. Its like, wow, this really is a hit. I think thats right. Although im sure the analogy is not one trump would use. I wouldnt be too quick to say that he doesnt have the idea of doing something and helping oh, he wants it. I havent spoken in a long time. A year ago when i said i cant believe whats happening. I said are you shocked by whats happening. And i said is this something you want he said i really want to do this. This has not to do with he said i want to do this. I want to make america a better place. I believe he believes that 100 . At this point. I believe a lot of highranking republicans still have the question in their minds is he willing to do whats nest and go all the way. Hes 70. Hes got a lot of money. Hes working his ass off right now. You can see that. Its not easy. Im not saying hes sacrificing, but hes still running a cheetah campaign though. Thats one telltale in his world if youre not willing to put up the money, how serious are you . 11 weeks left or something. So you dont buy the argument running lean and mean and shes wasting all this money. The way she runs the campaign is the way she believes in government . Yeah. But shell probably win the way shes going. You have to change the tenor of the race. You think its about money . Hes got to get ads out there to convince the undecided hes not the crazy man they see. That theres another side of him. Theres so many things you have to do if youre serious about winning. Including get out the vote. Holman jenkins, hope to see you again. Thank you. Former Commerce Technology chairman and ceo Jacob Kobi Alexander has agreed to come back to the u. S. To face charges after being indicted in a wide ranging stock option scandal nearly a decade ago. You remember this . You read about steve jobs Stock Options . Didnt apply to him. Scott cohn joins us now from brooklyn. Thats not where you were last time i saw you. You know i get around, joe. I had to come back for this because this has been a long time in the making. You know, the last time we saw Kobi Alexander in a courtroom was almost ten years ago and 7,000 miles from brooklyn in namibia where he was fighting extradition to the u. S. On 35 felony counts including fraud, bribery, obstruction of justice in a wide ranging scheme. That fight is now over as of yesterday when he was placed in the custody of fbi agents in namibia and began the long flight back here to the east coast where he will arrive this morning. And will be in court. When we saw him in 2007, he was living in a gated community. Near the country club. He was building housing in namibia. He was donating to education which critics said was an attempt to buy off the namibian government. In addition to that, i should say, he was doing chartable works including running a pair of soup kitchens that feeds hundreds of children every day. And thats what his attorneys will be focusing on today as we said Kobi Alexander is currently in fbi custody. He will plead guilty in a plea deal to one count of securities fraud which carries a maximum term of ten years in prison. And this is where it gets interesting because he plans to request bail 25 million bond secured by 10 million in cash. The government will oppose that and we will see whether the judge will let Kobi Alexander go free after being in africa ten years and thus will end one of the remaining cases from the dotcom era. This was the company that helped invent voice mail. But alexander and two other executives were accused in this wide ranging Stock Options back dating scheme basically allowing himself and favorite insiders to buy highflying inflated stocks at low, low prices. Cheating the shareholders allegedly out of millions of dollars. Today he will plead guilty to one count of fraud. Guys . Wow. Amazing to see that come around from namibia to brooklyn. Thank you, scott. Coming up next, the pizza revolution. App growing number of fast casual chains looking to get a piece of the pie. You get it . Its not tv, its not cable unless you really have a bad pun. Well talk to a ceo object going to head to head with dominos. The ceo dunkin personal investor in this company. Well see why. Its a casual Pizza Companies looking to get a piece of the pie. Sales at these higher end restaurants growing more than 30 in the last year. According to food Consultant Firm technomic. Theyre still just a small slice of the market dominated by giants like pizza hut and dominos joining us is ceo of mod which stands for made on demand, i think. Mod pizza. Fast casual customizable pizza chain. And our guest host nigel travis is an investor in the company. I think youre an Honorable Mention for cnbc disrupters. Have i got that right . Thats right. Thanks for having me. Youre up to youre mostly i cant remember. Was it mostly Company Owned . And youre up to over a hundred at this point already, right . Yeah. As a matter of fact, we had a big day yesterday. We opened our 150th store yesterday. We started this year with 92. And of the 150, about 130 of them are Company Owned. And we have a small group of fantastic franchise partners. And its sort of an artisan type pizza. You go in, one price you get as many ingredients as you want. Its custom made and you can have it in six to eight minutes . Yeah. So the whole idea is 11 inch artisan style pizza made exactly the way you want it right in front of you. Cooked individually for you and it takes about three minutes to cook. So the whole experience from when you first engage with someone at the line until you have your individualized pizza is about six to eight minutes. You pay more than industry average. 15 might be a problem. But youre at 10. 50 i think at this point. And i read something in the notes also that you make an effort to hire people that in the words that i read, that have a tumultuous background. And they become some of your best employees. What does that mean . We decide dod build the business around a really strong culture that was inspired by a purpose to try to make a difference in peoples lives. And specifically to make a difference in the lives of the people we employ. And so we decided that we were going to pay people well. We were going to take care of them. We were going to treat them like they were our own family, our own kids. And we were going to really celebrate their individuality and their potential. And that meant giving people opportunities that, frankly, needed them. Needed a fresh start, a second chance. And its really blossomed into something special. We have people in our business who have had a troubled background. We chose to decide to look at their past as a way to describe them. But not to define them. Some of our most impactful team members are former felons. Or they had challenges with drugs and alcohol or other personal challenges. They came to mod and we believed in them. Theyve given back to us in huge ways in terms of loyalty, leadership, and productivity. Its been a wonderful experience. Nigel, whyd you invest in this company . Several reasons. One was scott obviously has a tremendous track record in the uk. He not only starbucks u can rks. But it came from seattle coffee that starbucks bought. And then a great italian chain. In fact, theres one close to my place in london i use all the time. So scotts been a multimillion entrepreneur. But i think the first casual pizza business is one thats growing quickly. The question i was going to ask scott was theres talk about consolidation. How do you see the growth of the segment, scott, and do you see future consolidation . Yeah. So great question. A lot of people ask. We opened our first store in 2008. And around 2011 or 2012, a lot of other concepts just like ours starts to pop up all over the country. Over the following two, three years, it was a real gold rush. Today there are probably 80 or 90 brands around the country that are trying to do fast pizza. Were starting to see a little bit of a settling out where a lot of the concepts that started and proclaimed to be the chipotle of pizza have had some trouble. Its difficult to build a business. Particularly if youre going to do it at scale. And there are few brands that are emerging that i think have a real shot at Building National a national presence. And i do think that there will be either some companies that just find a difficult time scaling. There could be consolidation. Its tough to combine brands that have dispaired ownership structures. Some are franchisees, some are Company Owned. To put those together and to really create value unless one brand is in real distress, thats a challenge. We have decided that were going to build our brand. We love what were doing. Weve got great momentum. Last year we were the Fastest Growing restaurant chain in the country. So were not really very focused on the idea of consolidation. But im sure there will be some overtime. Hey, scott. I dont know if i want to, like, pick my own ingredients. Thats a lot of thinking. If i come in, can i say give me your best pizza. You got one . What would you give me if i said whats your best sfler can you give me one . What is it . When you come into mod, theres a menu board with ten classics. Some of our best piz sas. I recommend a mad dog. The meat eaters pizza. Its got pepperoni and spicy sausage. Its a fantastic its one of our best sellers. You just knew thats what i was talking about. What do you get . The kale . What goes with kale . Chardonnay. I would do the mad dog. You know me. I know. They have chardonnay and beer. You do . Is that true . Yeah. We have some great beer on tap and some actually wine on tap. Wine on tap is a fantastic its great. Smart. We do have roasted brussels sprouts though. Love roasted brussels sprouts. Gassy. Tmi. Maybe that explains a lot. Thank you. Appreciate it. Sounds great. Thanks for having me. Next time, were eating waffles. We dont need your pizza. But midwenext time we will need product. If you want to come back. When we come back, weve got a lot to talk about. Students getting a college alternative. We will bring you that story when squawk box returns in a moment. Welcome back to squawk box. Nick cannons got talent and now some homework. The americas got talent host is going back to school. He just posted photos of his first day on campus at howard university. Saying in a statement this would be his First College degree. No word yet on what the 35yearold rapper is going to major in. He will be juggling a lot. Hes got his work with tv shows and other projects. Plus hes now having homework. You dont have to decide your major until your freshman or so sophomore year. He was with us a week ago. Did not let us know. Coding boot camps can land you a hightech job and a six figure salary. Aditi joins us live with more. Reporter hi there, guys. Well, things are quiet here in this classroom at this hour. In a few short hours, its going to be packed with students getting ready here at the headquarters for their day of coding boot camp. Its seen by many as an attractive alternative to college or grad school. Rack reactor programs last 12 weeks, but students are here from 12 to 16 hours a day 6 days a week. Theyre also learning soft skills like how to give and take feedback. Tuition, 20,000. Its about a tenth of a fouryear college. 90 get jobs at Companies Like google and facebook. Average starting salary, 105,000. Im told part of the success of the program rests in offering the most current curriculum. We are teaching uptodate versions of recent open source frameworks. And we are familiar with Industry Trends in a way you dont generally see in college programs. Reporter and guys, we caught up with a recent graduate of the program who now works at esurance and he doubled his salary during the 12week program. That is fantastic. Love it. All right. Thanks, aditi. Looking forward to seeing the room full later on in your live shots. Weve got Corporate News for everybody this morning. Tesla announcing a new battery is going to allow the model s to go from 0 to 60 miles per hour. Elon musks goal is to make the fastest car in the world available to the general public. It will start at 134,000. New battery will allow its cars to go up to 315 miles on a single charge. You can get from l. A. To San Francisco. Its calling the new version ludicrous p100d. Buzzfeed is splitting into two. One will be called Buzzfeed News and focus on news. While the other buzzfeed entertainment will focus on its lighter fare. Like Celebrity News and quizzes. The move is an effort by the firm to solidify its dominance in digital video. Last year Nbc Universal invested 200 million in the firm. Nbc of course is the Parent Company of cnbc. Got operations all over the place. Yeah. Theme parks. Networks. Usa. Websites. Movie studios. Olympics, by the way. If you read the Media Coverage of the olympics, would you think it would have been the most profitable it is the most profitable. Its the most profitable olympics ever for nbc even in spite of the millennials. No, no. I know. But they were looking at other things. But the biggest problem i would argue with the headline, not to be a homer on this, is that they argue that somehow millennials werent watching. But if you look at all of the numbers between snapchat, facebook, instagram, it is remarkable. The numbers are much higher than had been reported. Thats valuable content. I dont care what of course monetize it at the same time. But its also how you if you can effectively measure what were talking about. A and id say if youre watching, a lot of people probably saw some commercials too. Which you dont you cant guarantee on other content that people are going to sit through those. Anyway, i dont know if thats been reported. That it was the most profitable. Julia boorstin she said it was the most profitable . Yeah. The viewership levels relative to london. And the money it was highly profitable. Coming up, janet yellen set to take the stage this friday. Were going to have exclusive results from the fed survey. Thats next. Then reaction from ed lazear. Well be right back. Guys . Theres a lot of tree branches and dry brush over here. We should probably move the bonfire over there. [smokey whistling a tune] im guessing smokey liked that idea. I dont know why were playing this song. But we like it. Were just two you were asking me. I thought you knew why. I dont know why. Its something about the fed, i guess. You knew shake it up the other day. But that was after the trump i dont know why we played that. Were just two days away from Janet Yellens speech at jackson hole. We are releasing the latest cnbc fed survey right here on squawk box. Steve leisman has made his way out west. Look at the beautiful shot from jackson hole. Hes got the results. It looks chilly there, steve. Yeah. You know, no tetons, by the way. We have a fire about its a family show, dude. Yeah. So, you know, markets are focused intently on this conference. Looking for any hints of fed policy. Especially Janet Yellens speech which comes up on friday. Well have fed speakers talk about that in a minute. We want to give the results of the cnbc fed survey jackson hole edition. And theyre going to be debating here Monetary Policy framework. As youll see in a second, most people on wall street dont think the fed has a framework for Monetary Policy. Lets look at the outlook for rates. You can see theyve pushed it all back once again. It was december 2016. The average respondent was expecting the first move now, its january 2017. When do they think the Balance Sheet will decline . After may 2017. Thats been pushed back again. The terminal rate, still expected to be hit in the Fourth Quarter of 2018. 2. 29 is where they believe the Federal Reserve will stop. You can see here in the next screen, what youll see is the outlook for funds rate this year. 1. 22 and 1. 87 . They think theres going to be a lot of tightening to come but near term very little. Lets look at what people think about how the fed makes policy. And you can see that they dont think they do it very well. We asked do you think b the fed is making policy based on the latest Economic Data . Just 38 say the fed follows its own metric which is the medium Term Economic outlook. 16 dont know and theyre unsure. 39 economists, Fund Managers polled here. One more thing here, does the fed have a framework . 60 say no. Theres no framework out there. And again, the 16 dont know. Heres some of the commentary. A lot of frustration, a lot of confusion on wall street. The fed has failed to come to a consensus on communications. The blow to credibility is leaving markets pricing a form of infinite easing. And joel naroff says when you base policy on current data that are volatile, you get volatile policy statements. Tough go online to see what peter brookevar said. Tomorrow we have Esther George from the kansas city fed. Over the next couple days well have first on interviews here from Federal Reserve. Back to you. Theyre going to be great to have her on tomorrow morning. Terrific. Reporter yeah. Nice and warm out here. Yeah. So you meant the tetons are gone. Theyre still there, right . We just cant see them. Reporter well, we dont know, joe. We dont know. Thats a good question you ask. Usually theyre there. Reporter weve been meaning to send one of our crew members out there across the plain here. But we know theres bears and moose in there. So nobodys actually volunteered to make the trek. I bet you theyre still there. Thats just a reporter you know what well do, joe . If they appear well do a breakin live shot on that. And weve talked steve into going out to jackson hole. Gee, steve. Thats rough one. Thanks for doing that for us, steve. Really. Reporter they threatened to fire me if i didnt go. It was i didnt want to do it. And have you done this yet . Have you done . He cant see that probably. Hes casting. Reporter what youre doing is wrong. Youve got to stop 10 00, 2 00. You know what im doing. Thats out of the shot. Thats out of the shot. Reporter no. I dont know what this is. This is flailing like the executive producer. Thats how he fly fishes. All right. Forget it. For more on this weeks big fed gathering, lets bring in ed lazear. A senior fellow at the hoover institution. Hes also the former chairman of the president s council of economic advisers. And i cant remember last time we talked whether you think were behind the curve. But one fact that ill let you start with is the dollar is lower than it was and we had a rate increase. So is that whole idea that were going to you know, theres currency fluctuations that will be that will go against what our intentions what we want to happen. Is that why they dont do it . Does that hold true anymore . I dont think so. This comes back to the point steve was making earlier about whether they have a model. Remember, there are lots of individuals on this committee and each individual has their own model in their heads. But the main thing is that when you see the data and that feeds into these model, the data have not been particularly strong and havent been particularly consistent. So just going back to what you said a minute ago, joe, when you say behind the curve, the problem has been that as theyve been looking at the data, no matter which model you use, they havent had a consistent period during which they could actually act in a consistent way to raise rates. So now were sitting at a point in the Business Cycle where normally we would be at the peak of rates. And wed be looking if anything to lower rates or keep them stable. And now weve got a situation where the fed needs to be thinking about a long run upward trajectory. And thats kind of backwards. It doesnt fit the history, unfortunately. Bless you. Thank you. Got to let it out, man. I was trying to hold onto that. You could get a hernia. I thesneezed. I was trying to hold onto it. It just means i said the truth. You know that. Theres a histamine reaction if you look in the sun. So ed, so any more will there be a september or december . I know there will be, but there l there be a hike in either month . I doubt it. I dont want to bring politics into this, but no matter what they do, its political. If they raise rates and that has adverse consequences for markets, thats political. If they dont raise rates and that favors then couple be incu thats political. Again, i think the main thing you have to look at and you ask why did the fed do this, ill come to their defense. While steve was just reporting what people are saying is a bit harsh. The reason its harsh is if youre a policy maker and youre looking to raise rates and you see data that keeps coming in and says, gee, gdp is at 2 . Recently its been at 1 . The labor market is not back where it should be despite the fact we have 4. 9 unemployment. Housi Housing Starts are stable, but theyre low. Were not really back to where we should be. And if im janet or ben bernanke and thinking what should i be doing right now, i cant say that im confident that this economy is on a strong trajectory. So thats the reason that they havent done it. But unfortunately given that posture from the past, were sitting in a position right now where we should not be at this point in the Business Cycle. We got to go, i guess. The only thing i was going to ask is is it really a 4. 9 job market or is it a 60 Participation Rate job market . Right. Yeah. I think that the Unemployment Rate overstates the strength of the labor market. Id say were closer to the high five percentage range. The key number is to look at the employment rate. The employment rate is 59. 7 . Thats way down from where it should be. Even if we correct for demographics. I know. So you know were not quite there. I agree. All right. Thank you. I thought you might say that. Thanks, ed. Thank you, joe. Good to talk with you. Coming up when we return, betting on europe. Well tell you what david herro is finding opportunity abroad. Next. Welcome to opportunitys knocking, where selfproclaimed financial superstars pitch you investment opportunities. Ive got a fantastic deal for you gold with the right pool of investors, theres a lot of money to be made. But first, investors must ask the right questions and use the smartcheck challenge to make the right decisions. Youre not even registered; im done with you i can. I can. Savvy investors check their financial pros background by visiting smartcheck. Gov the markets brace for the worst following the brexit vote. But the Economic Impact has been muted so far. Joining us now to tell us about the international markets, david herro. He manages the gold rated oak Mark International fund, manages 44 billion. Good to have you here. Good morning. Good to have you. So differentiate between the u. S. Markets we talked so much about multiple expansion because of low Interest Rates. I assume its the same in the rest of the world as well because Interest Rates are lower there. Right . What weve seen is for bifurcated multiples outside the United States. In particular if you look at the european market, certain sectors such as consumer staple stocks, Health Care Stocks are trading at huge multiples. But if you look at other sectors, theyre selling at extremely low multiples. And this is very reminiscent of late 2008 when you had these bifurcated valuations within the various industrial groups. And to us that really means theres a lot of opportunity out there. Because people are paying a lot for safety. I would argue theyre paying way too much for safety. That would be reflected in your top holdings portfolio. Im looking at the top five here. Bnp paribas, glencore which minor commodity trader or finance company. All of the above. Right. Tell me about glencore only because its one of the most controversial stocks. Glencore has been a textbook restructuring story. Recall about 11 months ago they were kind of caught with too much debt at the low end of the commodities cycle. About a quarter or third of their business is not affected by the cycle as much because theyre traders. And they basically are delivering commodities, buying and selling to the go between man. But its the other twothirds, threequarters of their business that are exposed to copper, coal, zinc. As a result they undertook a restructuring. Which really theyve done a very good job at it. Theyve cut debt from around 40 billion to projected to be less than 20 billion. The equity raises in capex. So theyre doing all the right things and generating free cash. Hold on one second. Our guest host nigel travis has a question. Good morning. Good morning. Obviously being a brit originally i follow whats happened in the uk a lot. How do you see brexit playing out . Obviously as you mentioned, theres been some recent upticks, some good numbers that came out yesterday i think. How do you see it over the next few months or even the next few years . I think as an investor, were investing in businesses that have long streams of cash flows. What we have to do is look at how that vote has really impacted companies mostly european based ones were strongly impacted byvote, wheth Companies Cash flow streams are impacted as a result of the vote. I think the jury is still out. However, evidence is showing that maybe in the short term you will see some impact, but in the medium and long term, very few, very small portion of these cash flow streams will be impacted, meaning, the value of these businesss, which is based on the cash flow streams, hasnt been altered, despite the fact that the prices of these businesses and many cases have plummeted. This spells opportunity as the market is focusing on the shortterm instability that brexit brought but isnt looking at the longterm fundamentals and whats happening to the businesses. All right. Why do you why not pronounce it hero . I dont get it. You like herro . When i was in grade school and high school i was teased a lot with that. Why did you get teased . In Money Managers you dont try to be a hero. No. I would get rid of an r. Go with it man, say it loud and proud. Youre a hero in the investment business. Thank you for that. Whats your middle initial . Super . David superhero. G. Thank you. Valid. Oh, god. She says vadal. Advil. Were doing the jumble. Coming up like you did before, you pronounce [ inaudible ] shrek ki. Jim cramer is live from the new york stock exchange. Check out the futures. We will be right back. Hey hows it going, hotcakes . Hotcakes. This place has hotcakes. So why arent they selling like hotcakes . With comcast Business Internet and wifi pro, they could be. Just add a customized message to your wifi pro splash page and youll reach your customers where their eyes are already on their devices. Order up. Its more than just wifi, it can help grow your business. You dont see that every day. Introducing wifi pro, wifi that helps grow your business. Comcast business. Built for business. For decades, investors have used a 60 40 stock and bond model, with little in alternatives. Yet alternatives can tap opportunities that traditional assets cant. And even though theyre called alternatives, theyre actually designed to help meet very traditional goals. Thats why invesco believes people should look past conventional models and make alternatives a core part of their portfolios. Translation . Goodbye 60 40, hello 50 30 20. Announcer when they test you, stand firm and move only when you hear the seatbelt click that says theyre buckled in for the drive. Never give up till they buckle up. Your Business Needs Better Technology to drive better performance. So you need it to be reliable and fast. Really fast. Introducing the comcast business Summer Savings event. Fast Internet Speed to drive performance, plus cutting edge wifi for your employees and customers, and voice mobility so your calls find you wherever you are. Get some of our most advanced products at a great price with over 500 in savings. Call today and ask how to get these savings plus a 250 prepaid card. Comcast business. Built for business. Lets get down to the new york stock exchange. Jim cramer. Joins us now. Were in between sort of earnings i think, jim, and oil is down, but its still at 47. What are we going to key off today, if anything . It is the dog days of august, i think. I still think were focused on a lot of housing that yesterday that housing number was incredible, back, you know, to the good old days, so to speak. Bob toll talked how were still nowhere near what we used to build and people are trying to get their arms around the glhe that housing is so strong that even if janet yellen says something on friday that is hawkish, this group may have so much momentum its just good news and i know a lot of people want to see good news and call it bad fuse bought the housing resurgence is helping. Speaking of the dog days of august, jim, how are your tomatoes . Wow. All your canning. Oh. They look delicious. I didnt grow enough plums and cheeries, you dont have to take the seeds out before you do the sauce. Too many german johnsons big boys and beefsteaks. I would be getting the seeds out all weekend before i make the jars. Saw it on facebook. It was cool . Most fun thing i do. I love it. See you later. Coming up much more from our guest host, niegel travis, ceo of duncan doughnuts. Well be right back. Can a toothpaste do everything well . This clean was like pow. It felt like i had just gone to the dentist. It just kind of like, wiped everything clean. My teeth are glowing. They are so white. Crest [hd]. 6x cleaning, 6x whitening. And at two weeks superior sensitivity relief to the leading sensitivity toothpaste. I actually really like the two steps crest [hd]. Step 1 cleans, step 2 whitens. Its the whole package. No ones done this. Crest healthy, beautiful smiles for life. New biwhat are we gonna do . Ys. How about we pump more into promotions . Nah. What else . What if we hire more sales reps . Nah. What else . What if we digitize the whole supply chain . So people can customize their bike before they buy it. That worked better than expected. Ill dial it back. Yeah, dial it back. Just a little. Live business, powered by sap. When you run live, you run simple. All right. Our guest host this morning is nigel travis ceo of Dunkin Brands. We talk about it all the time with what the real employment picture is. You heard ed lazear talking about it has to it with the Participation Rate. When you said its tough to get workers, you did have a lot you were xifk about why that was. It depends on areas, on a lot. Sometimes people dont want their kids to work there, i guess. Yeah. And, you know, we as an industry, work harder, sending out the impression about what a great industry it is to get started much ive learned this morning that michele started there. At pizza hut. I mean, it really is the first rung on the ladder. If you want to progress quickly a great industry to get in. Its a growing industry. I mean i pulled out some statistics this morning. This year the jobs in the industry will grow 3. 1 . Its an industry people forget is 9 the franchise industry is 944 billion. And the Restaurant Industry is 783 billion. And it was also voted the favorite industry. So something i dont understand why people dont want jobs. Weve got to change that impression and were going to work hard on it. While talking about drives what drives it is the products. We thought it was awesome. I want sir rum on this waffle sandwich. Have you dunked a doughnut yet. Were in overtime my friend. Thank you for coming in. Thank you. Good to see you. Join us tomorrow. Eat waffles. Squawk on the street begins right now. Good wednesday morning. Welcome to squawk on the street. Im Carl Quintanilla with jim cramer at the new york stock exchange. Stocks within a earshot of a record after the nasdaq set one on tuesday. Disappointment in retail. The countdown to jackson hole begins. Europe steady as we w