Transcripts For CNBC Squawk On The Street 20160526

Cramer. You can see the dax, which is not having a great year is up. France and the ftse is down ever so slightly. 10year note yield and wti right at 50 bucks and brent a bit above that. The yield at 1. 854. Lets get to our road map this morning. It begins with more painful retail. Were going to break down all of the big earnings that are out this morning on that front. And is the ipo market back . There are Six Companies making their debut today. U. S. Foods we just mentioned here at the nyc, set to be the second largest initial Public Offering on the year. I think Mgm Properties will be the largest still. And what role will apple play in the future of television . The deal, i dont want to say it, were going to talk about this fun story. Its fun. Its never going to happen. Kim jong jim if you havent seen that one. I dont think of you as the fearless leader. No, and i havent spent a lot of time with Dennis Rodman either. Crude surpassed 50. Stock futures also up following on the gains weve had recently. All three major indices now in positive territory for the month. Jim . Oil has often been the story. 50. This was supposed to be the time when canada came back on line, the wildfires are behind us, they are going to be flooding us with oil. A lot of people theres more driving, just more driving, more demand. They make that very clear on that conference call, theyre nationwide. China not pumping like they were. Were dropping like flies now. 20 counties where you can make money pumping. Youll hear people come on our network and that he will say we can make money at 50, 60. I want to say to them, yeah, but youre losing money right now. Dont give me this 50, 60 stuff. Go on the conference call. Youll hear pain. 50 bucks in terms of how much supply has been taken out because of fracking, there are parts of oklahoma that are still very good and others that arent including the bachan. At 50 youre going to see tremendous futures selling. Ive been using a target of mid 30s. At 50 they can sell off the curve and pay back the bank of americas. This is much more of an equilibrium. Where weve gone from 9 to 8 barrels a day or is it 10 to 9 . It could be 9 to 8. Saudi arabia did everything they said they were going to do. They crushed the prices, they then got the market share back. They are in charge. I got to hand it to them. Theyre great business people. They are. Theyre great business people. They wiped out the marginal producers in this country and then they took the share. Nigeria has issues, iran is pumping. Not nearly as much. That was a lot of sound and furry that signified nothing. Iran is not producing a lot. Whats important is demand is up. A lot of what we thought is oil really a precursor of demand, demands up and supplys down. We hang around, with that be a healthy thing . Seems as though it might not be a bad place to be. Gasoline is at a decent price for the dollar trees, Dollar General. That has been the right trade and it was even more right today. I think its stayssis. Weve already had that. The areas that went down went down. Im doing work with a company outside of denver and its on the margin. We talk so often, well see deals and consolidation, you really havent. Youve seen some oneoffs, bankruptcies and restructurings, there are more that will still come but do you start to see some of the major say nows the time . They have not. They have been sticking by that theme theyre not going to. Exxon 90. Theyre basically saying talk to the hand. We heard occidental. Chase is no longer the ceo. He was sort of 80 bucks is where we hear. We keep hearing range resources bought. Theres oil and theres natural gas. Everyone is saying if it stays this hot, youll get the glut burnoff. And the trains will start shipping. Were not on such with natural gas in the northeast, were brimming with excess. We need to have the air conditioners going. Natural gas has to go to 250. You see chesapeake going up. Freeport, people feel thats no longer a situation that is dicey. That is fraught . Fraught. Theyre off the intensive care list . No, theyre in intensive care. Its no longer paddles, clear. But its not pacemaker. We can leave for a while, we dont have to worry that somethings going to happen while were at lunch. 50 is a nice level. You dont have to worry that every minute bank of america is going to recriticize their portfolio. The consumer is not shopping at some places and other places that consumer cant live without, including the dollar stores. Dollar store and costco as well. Costco was 1. 23 a share. Comps were flat for the first time in six years. Dollar johnson and dollar tree, both discount retailers did post higher samestore sales. Where do you want to start . I got to tell you, the dollar tree, david, we often times we laugh the family dollar, brilliant. Dollar general wanted in on it and there was antitrust. They completed the deal and there were divestitures and youre saying it was a good deal . It was a great deal. A lot of it is consumables. These places have done much better for food. You see they have smaller packages but people feel its a bargain. When i go to dollar tree, david, i feel like im worth a million bucks. Well, you are actually. Well, you like to feel it. Its nice to feel it. When you walk in, i dont think youre exactly feeling exatted. Then you havent been to you can eat off of the floor of my dollar tree. Memorial day weekend, you got to get there before to get all the flags you need, all the different accoutrements for your picnic table. Plus they have glasses. They have readers for like a buck 50. You ever see the font that i send you . Yes, i have. Its big, very large. I have to tell you, cost co is a big mystery. Samestore sales worth 3. 4 , increased 3. 4 in the prior period. Did you see the net income of these guys . 3. 3 samestore increase this time. They are declining, samestore sales growth is coming down. You know what . Look, absolutely everybodys is. But the amount of money that theyre making at both dollar tree and Dollar General is extraordinary. Look at this, 418 million versus 232 million . David, thats a business you and i are going to be in. If you and i are going to open up a lemonade stand, were going to charge 1. Lets move on to costco. The reason why costco has nothing to do with the comp sale numbers, nothing to do with the betterthanexpected numbers. This was the quarter we were saying goodbye to American Express and going to vvisa. When we went to costco, they said youre going to get a lot more points next time, wait till visa, dont come back until u get visa. When they tell you at the register, about to get a much better deal when you come back next time. David, do you feel like having two carts at costco or one . Were a twocart family because we have storage space. Were one cart until visa comes in. Charlie pulled that deal off right underneath American Expresss nose. They said i dont know why American Express didnt pay up. Its going to be huge for visa. Victory. Now were in it now, right . And what happens is is that you know, really these people are great, i happen to love costco more than almost any store. And you know i like stores. I love stores, okay . Were aware of that. I buy my zana. I get it at costco. You can buy it there cheaper than most mens stores can buy it from zana. You dont have to buy like a hundred of them at a time . I once took all their north face. I took every they had. Ask jim synagogue was there. They had like six vests, why not. Six purple vests. Gave them to everybody. The credit card switch is going to be humongous. Thats why people are buying costco. Not because of the same store. That means nothing. This is about the change in credit card. Have i made that clear . You made that clear. Well get to sears later. We have to get to sears. Adjusted ebidta is up 14 million. Adjusted for this that, this that, this that, this that. I will not shop at kmart and that is a benchmark. My first suit when i walked in was from kmart, cord roy. I would love to see that. Well talk about the apple beforesession winning streak. And gearing up for the summer season. Some high tech thrown into the mix. Well talk about the u. S. Foods ipo coming up here. Theres another look at futures. Were back after this. [crowd cheering] i could get used to this. Now you can. When you lease the 2016 es 350 for 329 a month for 36 months. See your lexus dealer. U. S. Food began trading, its the Company Earned just over 24 million, the second highest of the year. They will trade under the Ticker Symbol usfd. Well have an exclusive interview with the ceo of the compa company. There was quite a deal and it was abandoned on antitrust ground. That may have been a precursor of what happened. This is a delevering transaction to a certain extent. There were buyers of this company back in the heyday of lbos. This was 7 billion, it barely made a headline im kind of kidding but you had the huge deals, txu or hilton, so many of them. This was a 7 billion deal though, jim. Not a winner. Not a winner. Theyre taking it public. Theyre not selling shareholders, that is the private equity guys who will continue to control us foods. We usa the walgreens kkr, nxpi i think there was some selling, i think it was kkr, free scale. A carl english piece, its amazing how theyre all trying to get these secondaries in, david. They really need to raise cash or they want to get out. Exits have been the rule in private equity. There have been purchases. They dont make headlines because they typically are smaller. The one that no one should have let go is Dollar General. Its been such a win. They did a great job. And i have to love those guys. I know this ipo market has made things difficult but, gees, theyve had some wins, too. If you bought from them in some cases, you did quite well. And they like that. They do. Well keep an eye on us food shares. Apple looking to extend a winning streak now that is four sessions so it would be five today. And an incement incremental 5 billion spent by apple on r d. I pushed netflix hard. Last fall there was a lot of talk around Silicon Valley and some interest in Media Companies and i made calls as well as a lot of other reporters on time warner, didnt get the specifics about this meeting and they were talking about programming deals or content deals or something and he brought this up. It never even made it to a conversation with cook. And they saw each other afterwards. They didnt even discuss it. So it wasnt going anywhere. Even though i didnt have details, i had enough to say this wasnt worth continuing to pursue. In the new era where everybodys a journalist, everybody can write, theres no editors. I recommended netflix last night on mad money. It want because i thought that would be a great revenue stream for apple. Thats not the way apple works. They dont come in and say were going to buy netflix for 60 million. There were no conversations about it other than this initial one. So what happens . Youre a journalist for many years. Do they get punished . I dont know. Were talking about it. Right . Its a fun story. People are talking about it. I got a few calls on it, emails, so it works. But is that do they go and buy the options, they gun it and liquidate it . Is it bgl . I dont think its that. Its just guys looking to make their jobs relevant . Exactly. Why not. Youre talking to the guy who did report gm and chrysler when they were talking i was like this is a ridiculous deal. As somebody who studies the craft and has rigor, do these stories bother you when you know that two guys talk . A little bit. I would contrast it i did a story a year ago on sales force and microsoft and i did that story even though it was after the fact of talks because they were extended talks between the ceo that involved advisers and the board of directors, a structure of a deal and i felt like the marketplace would be better off knowing, even though they were no longer talking. Now, in this case its very different. Youre talking about one conversation, hey, wouldnt it be funny if we bought you . Business insiders happen to love it. I did this interview with marc benioff last week where he put to rest the idea that he was going to sell the company. Did he put that to rest . Yes. And the article comes out the next day that can cramer makes benioff. I had a raspy voice that day. Mark did not answer it. I had to answer it again after the tea. The first answer was ambiguous. I couldnt talk. I shouldnt have been at work. I should have been at home and i should have been having chicken soup and my wife should have because of that they said it was a sell. Everyone else made tens of thousands and i got a hack. You think im a good businessman . Im an idiot. You were an idiot on that one. You didnt have to verify that. You could still be getting residual checks. I get them on wall street, too. If they had made it with louis c. K. , i would have gone into it. Take a look on futures. Looks like they we are at least going to start off with another positive session. More squawk on the street right after this. Everybody knows that Business Today is built on data. The thing is, most businesses arent getting the most out of it. The ibm cloud is uniquely designed for all kinds of data. Like data from the Weather Company for 2. 2 billion locations. Or billions of healthrelated data points. Even social sentiment in real time from hundreds of millions of people. Its all in the ibm cloud. 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You want to talk hp ink. This is the printer and pc. This is one of the funniest Conference Calls ive been on for a long time. First of all, he was just a great guy, talking about 3d printing. Nike and others are partners. Personal systems are on down 10 . Consumers down only 16 , printing is only down 16 and deon says what im most happy about is we did exactly what we said wed do. Now, tony, who has now become the big critic of our times, hes not just an analyst. Hes tough. Hes tough. He says and i happen to love the guy because hes really smart mee smart. He has a new way to do it. He wonders about the things that you stabilize, he says its not transparent to me. Its saying stick a fork in it, you guys are done. So what is it . Its push me, pull you. This is how a stock stays unchanged, they buy back stocks, more than 20 million shares, theyre paying back dividend. Ba but the fact is no growth. And im with him. I disagreed with him on apple. But i agree with him on this. But he was wrong on that. Opening bell for us foods ipo coming up. Pg e, this is jerris, how may i help you today . I help customers with their bills. Theres different rates to fit different needs, so listening is a huge part of my job. Because customers want to know that you hear them. They have kids, they have families, they have priorities. I definitely understand that. I have three children, i was a stay at home mom, i didnt have money to pay the bills, and so i put myself in their shoes. And im going to do all that i can to lower their bills and to help their situation. To choose the rate plan that works best for your family, visit pge. Com rates. Together, were building a better california. Steve, other than making im here atme move stuff,rade trader offices. What are you working on . Let me show you. Okay. Our thinkorswim Trading Platform aggregates all the options data you need in one place and lets you visualize that information for any options series. Okay, cool. Hang on a second. You can even see the anticipated range of a stock expecting earnings. Impressive. Whats up, tim. Td ameritrade. Incredible bladder prthat lets from always discreeyou move like you mean it now comes with an incredible promise. The always discreet double your money back guarantee. Always discreet is for bladder leaks and its drier than poise. Try it. Were so confident youll love it, well give you double your money back if you dont. Incredible bladder protection. Double your money back guarantee. Thats always discreet. All right. The applause building here as we get close to the opening bell this morning at the new york Stock Exchange. Of course here as weve said, us foods listing its ipo. Were going to speak to the ceo of what is the second largest food distributor. When that stock opens, priced at 23. And participation in red nose day, raising money to lift kids out of poverty. Mr. Cramer, what is the key . The key to this market . To this market. Lets get right to it. I am thinking that the key to this market will be the action, guess this, in ibm. Ibm . Because this is a level where if it can break out, we can say all of old tech with the exception of intel, the westinghouse prize and then len shiver picked up for regeneron. It was so great for regeneron. Good for regeneron taking that on. Ibm does a lot for awards, too. Ive taken the winners out for dinner. Weve been seeing techs doing better and better and better. Meanwhile, dollar tree, Dollar General, whats it say about our market today . Whats it save . What is happening in this country . This is the middle class actually really suffering. All these politicians talk about it but when you go to the stores, i happen to like dollar tree very much because i am a candy guy. Jim, go into cvs for candy, papa said its a sin. Does it really matter at this point that i have diabetes . He said i want you to buy them at dollar tree. Dollar tree is up 9 . It diverges from what weve seen in retail. To your point, jim, yeah, theres huge disparity in income in this country and were seeing that reflected perhaps on the frustration on the part of both left and right and very strong samestore sales from the likes of dollar tree and Dollar General. The stuff is cheap. If you want to go have a holiday and get stuff to dress up your picnic, you go to one of these two stores. And they do have very fine merchandise. Dollar tree has excellent managers in every one that i go to. I think people have to recognize this is not your fathers dollar store. Theyre very nice. But it says something about america. And i think that the candidates have to see this because it crystallizes a lot. Talking about retail before we get also to pvas but sears is up 11 . Samestore sales at kmart with only off 6. 1 overall. Kmart same store down 5 kenmore, craftsman, die hard, theyre all on the table. Dont forget lands end. They only lost 471 million. Thats an improvement. So things are going in the right direction. David, thats pay dirt. You can see the stock is up. Were talking with a company with a market value of 1. 4 billion. Still 5 billion in revs. It a huge company. As is jcpenney, which has a big presence and a lot of employees but a market value of about 2. 5 billion at jcp. Sears weve been talking about for years. What would Eddie Lambert have been like if he had just stuck to his hedge fund . Happier . I dont know. Im sure hes happy. David, the sears, im not kidding, lands end reports next week. They spun off lands end, they raised money there. Houdini was good. He was great. And then they got punched in the stomach. Thats why he died. Terrible. He might still be with us. Hed be 150. Who else would be executives massa son . He had a 150year plan. You cant have a run of up 6 in this market but pvh is an international story. People continue to relate it to macys, which macys. Com is very good for them, to kohls, to jcpenney, no. This is Tommy Hilfiger overseas. Theres a line to get into Tommy Hilfiger and the calvin klein in china paying off. Stop relating this company. Hes made this company far more its no longer hostage to the domestic samestore sales. Europe is very strong. Its one of the Largest Apparel Companies of the world. Apparel has been doing terribly so i dont get it. The heritage stores, the ties, the shirts are doing not that well at all. Thats true. Its the smaller part of the country. They bought overseas. Theyre making a killing in Calvin Klein Underwear. Its their strongest selling product. Id like to show you what they have if youre willing to let me show you. Because im a Calvin Klein Underwear guy. Maybe too much information . No. No, i have it on. We dont have to go. Thats great. Now we can always just cut it out at the end of the show. If you want to do that, sure. Let me think about that during the commercial break. Maybe when you go to Rick Santelli, ill decide whether i should show you what i have underneath. We have a bit for you about his comments about the consumer. This is the mall youre talking about . Our mall and our own retail stores. Were feeling the pressure. Both tommy and calvin are some of our Fastest Growing base. Our macys. Com business is on fire. Its critical with given our brands, the nature of our brand and how they resonate with the consumer, we need to be where the consumer shops and thats what we do. The mall is no longer the be all end all of pvh. Europe was killing them and now thats very strong. It was a brilliant move to buy hilfiger. When he first bought it, people thought he overpaid. This time calvin led, had fabulous numbers. Its a good company but its a very tough industry. You mentioned china. I did want to know shares of ali baba down rather sharply yesterday on their disclosure about the sec taking a look at a number of Different Things at the company. It doesnt mean anything is going to come of it. It doesnt mean anything wont come of it. Stocks up today after being down almost 8 yesterday. I never want to dont worry when i hear accounting and sec. Some of this may be related to singles the way they account, adjustments made, their delivery business, how do they account for that, why arent the losses included . Some questions raised by the likes of herb greenberg. Greenberg is taking a cruise somewhere. Cruise ships downgraded by morgan stanley, royal and carnival. There are some concerns about soft bookings. Very interesting. Shares of apple, jim, are down for five sessions. Youve been focused on it, you know. When you hear these stories, its going to be down. Are they going to buy netflix for 70 billion . Do you want to be in the stock where people are saying theyre gag to buy netflix, which is not going to happen, by the way. Computer sciences, this is a company thats going to double ebidta. From there its going to grow pretty dramatically, csc, and the market responded yesterday with an incredible move up. Hp shares had hit a high of 18 1 2 but are done from there. A lot of people were shorting Computer Science and suddenly they become excensure, which is incredible. I have to tell you, every kiss does not begin with kay today. No . A lot of people are questioning whether this is a Jewelry Company where you buy credit or is this a Credit Company where you buy jewelry . Its a battle ground. Biotech had shown a bit of life lately. Its all because of you and sanofi. They are well, well off their highs. Then you have an important drug that glaxo smith klein doesnt want to do a phase three. Youve got a lot of different currents. But the main thing people want to hear is that gilead is going to buy something. But their history has been theyll buy a big dollar thing but not a company that has a lot of employees. They dont like that. It was 90 employees when they bought sivaldi. They like to go down that road. David, the thing that concerns me. They like to go down that road, we talked about the Balance Sheet capacity that gilead has but their history has been more to buying those kinds of things as opposed to making a big, big purchase. Youre absolutely right. If you talk to alex gors can i, who i think the world of, his claim to fame, he did not blow miss head of buying one of these big biotechs and you dont want to buy a big biotech and being saddled with huge infrastructure. Gilead doesnt have a lot of employees, even now. I do think medivation made people think whats going on here. Nothing to report on medivation yet. At some point theyll begin the con isnt with sanofi. Why are European Companies being so aggressive . Do they think the dollar is going to soar . I think their borrowing costs are virtually nothing so why not. They dont have topline growth and sanofi needs oncology. So astrazeneca has to do something and basf and dont they all have to move to take advantage of this onetime gift from central bank . We keep saying its a onetime gift but it keeps going on, the gift that keeps giving. Are these European Countries constantly talking to bankers about taking advantage . The bankers are constantly talking to them about it. What do you think about activists working with passivists, meeting with the fidelities of the world and thats gone on a long time. Thats not done. Subject for another day. We have to get to mary thompson. Why, man . Over the weekend . Maybe. Whatever you want. Mary . Were seeing a modest gain on wall street on what is a busy preholiday thursday morning, we got betterthanexpected data on durable goods. The earnings bag mixed and importantly oil above 50 a barrel. Were watching a number of ipos. Im standing in the post where three of the ipos will trade today. Lets look at the s p 500 index. Going into the end of the session today, we have the fed governor speaking tomorrow setting up the fed speech tomorrow by janet yellen. Investors listening to see whether there are any clues given as to whether the fed will raise Interest Rates in june or july. This is the busiest week for the ipos and the biggest will be trading at post 8. Thats us foods. Its priced at 12 at the higher end of the range, making it over 1 billion ipo, the second largest this year. Behind me over here is gypsum management supplies. And to my left at post 6, we have cotiviti. It priced at the high end of the range at 19, expected to open right now, indicated between 20 and 21. It looks like a healthy open for two of the three ipos. Lets look at some of the sectors weve been watching today. We have wto trading about 50 a barrel. Were watching the energy sector. Retailers also in focus. A number of them out with earnings and of course we saw strong resultswith dollar tree, Dollar General but disappointing numbers from costco and weak guidance from williams sonoma. Guess and abercrombie and fitch reporting results below estimates and weak guidance and were watching the tech sectors, hps results and netapp was under pressure and is expected to be under pressure today. Thank you very much, mary thompson. Lets head to the bond pits and join Rick Santelli at the cme group in chicago. Rick. David, markets are pretty smart which mean there arent really a market personality, its all of the traders involved. Look at the intra day of tenyear note yields. Granted, the headline data today up 3. 4 on durables preliminary april read was really good. But the market saw past that and concentrated on the fact that aircraft was up almost 65 . Now, what that left you would, that aircraft, transportation, was up. 4, which is sill better than were anticipating. Theres quite a spread between the shock value of 3. 4 and. 4. Nothing against aircraft. Its vol tiff and thats why they pulled it out. Everything starts with a crawl. We are seeing just a bit steepening. It seems as though the perception, what happened to all markets, whether its the dollar rate or the curve, seems to have paused here. If we look at whats going on in europe, the spread between our much hotter economy based on yields versus theirs and all their policy issues really starts to show up. Look at a year to date of tens minus bunds. The fact that were hovering as this 170 level is critical. We can consolidate. It means our markets are handicap and economy are higher rates in europe, theyre being depressed, think mario draghi. If were concentrate on tens minus bunds, you can see the divergence. The other thing thats changed is the dollar. Lets look at the dollar since the last fed meeting in april. Aggressive. Now lets look at it sense the minutes just last week. Seems to be rounding a bit. Expectations may be changing for the nearby meeting and thats significant. David, back to you. Thank you very much, mr. Santelli. Lets get a closer look at oil prices, an important component of our mark action. Almost of day Jackie Deangelis joins us. Jackie . Under 50 a barrel now but we did cross that for wti. Were up 35 where is year to date in wti. Some of the reasons were seeing for oil prices to be supported at these level, we do probably have some Short Covering going into the holiday weekend. Typically people dont like to hold those short positions. But also still concerns about those global spupply outages, te canadian supply, whats going on in nigeria. Those worries have not gone away and you have the refinery strikes in france to consider. Seasonality, summer driving and the dollar is backing off just a little bit today, some saying maybe the move in the dollar was overdone. Yesterday u. S. Inventories drew and we did see production grow again. Were waiting for us foods to begin waiting. Looks at 24, 25. Well talk to the ceo once it opens for trading. The eclass has 11 intelligent driverassist systems. It recognizes pedestrians and alerts you. Warns you about incoming crosstraffic. Cameras and radar detect dangers you dont. And it can even stop by itself. So in this crash test, one things missing a crash. The 2016 eclass. Lease the e350 for 499 a month at your local mercedesbenz dealer. Approaching medicare eligibility . You may think you can put off checking out your Medicare Options until youre sixtyfive, but now is a good time to get the ball rolling. Keep in mind, medicare only covers about eighty percent of part b medical costs. The rest is up to you. Thats where aarp Medicare Supplement Insurance Plans insured by Unitedhealthcare Insurance Company come in. Like all standardized Medicare Supplement Insurance Plans, they could help pay some of what medicare doesnt, saving you in outofpocket medical costs. 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Call now, request your free decision guide and start gathering the information you need to help you keep rolling with confidence. Go long™. There it is, us foods not yet being traded. Bob pisani is away on vacation. Otherwise hed be in the pit there, in the little booth telling us every last move. But we will be with you of course when it opens and have the ceo after that. Up next, though, were going to have stock trading with jim. Maa fallujah argonne khe sanh midway dak to normandy medina ridge the chosin reservoir these are places history will never forget but more important are the faces we will always remember. But more important are the faces we will always remember. Its time to get seriously silly, people. Join red nose day to do some serious good to help fight kids poverty. Its simple just get your red nose, only at walgreens, and get your silly on, seriously. Time is running out. Get your red nose today at walgreens. All right, its that time to stop trading. Abercrombie, please stay away. Williamssonoma is one stock you should by. Laura alberts did a fantastic job. They are very technically oriented. Westhelm up gigantically. Laura albert, congratulations, was not willing to tolerate that minus. 2 pottery barn last quarter. Came back, made the pottery barn numbers good. Google says they know how to use data better than anybody. They are one fabulous ecommerce user. And id love to have laura albert on the show. What do you have coming up tonight . Louisiana kitchen, this is a tough business, the restaurant business. Not like mcdonalds because they cut price. They hurt a lot of companies. I want to find out if they hurt popeyes. Ill see you here tomorrow. Youll be working tomorrow and so will i. And the ceo of six flags, technology playing a big role. Squawk on the street back after this. Years ago, i was starring in a onewoman show about a cat allergic to other cats. Opening slash closing night it hit me hats for cats. 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All plans like these let you visit any doctor or hospital that accepts medicare patients, with no networks and virtually no referrals needed. So, call now, request your free guide, and explore the range of aarp Medicare Supplement plans. Sixtyfive may get all the attention, but now is a good time to start thinking about how you want things to be. Go long™. Oil cracking 50 for the First Time Since october settling back to 49. 7. Breaking news on pending home sales. Good morning. Pending home sales up 5. 1 month to month in april, to the highest level on the National Association of realtors pending home sales index in over a decade. This is the Third Straight month of gains. Were now up in april 4. 6 year over year. The realtors say this is despite the very short supply of homes for sale. We did see available homes rise but they were eaten up very quickly. Pending sales down 0. 6 . In the south up 6. 8 for the month and in the west, the highest, up 11. 4 month to month. Now the realtors are concerned that Interest Rates could be rising soon but they do point to these very low Interest Rates we saw in april as a factor behind that growth in sales. Again, this is the highest in over a decade so it does bode well for closings that we may see in may and june. Remember, this index is based on signed contracts in april up by. 1 . Diana olick, thank you very much. We have breaking news. Lets go to ammann. Sources investigating the hack attack in bangladesh confirm the investigation is now focused on as many as a dozen banks around the world. The source telling me that the focus of this investigation is on banks in asia, but the source would not say whether these were necessarily other Central Banks in countries in asia or whether these were private banks in asia, but the news here is that the investigation into that hack attack now focusing on up to a dozen banks. So thats a big expansion what we knew so far, guys. Eamon, thank you very much for that. Oil prices continue to climb. Investors waying the possibility of that would be june hike. For more on where investors should be focusing their attention, we turn to tom purcelly and eric. Lets take the short turn to start, eric. A good week. Big, round numbers. Is it time for a breather . Look, i think the market is going to trade in the United States range bound for a while. The big issue for us on the year is going to be earnings. Weve seen negative earnings in the last three quarters. Well have to see improvement before you can see stocks move beyond kind of that range weve been in. Its probably going to be the back half of the year when they do that. Tom, housing looks okay here . Claims are muted, wages and whats not to like right now regarding the macro . Youre preaching to the choir on that one. Weve been saying that for a long time. I dont think that theres anything sort of standing in the way of fed hikes. Weve been sort of fond of saying to clients that were paid to tell people what we think the fed will do, not what they should do. The should part of that equation is built on your fundamental view and thats supported multiple hikes this year but the will part is entirely predicated on fed rhetoric. If the fed wants to go in either june or july, independent not going to fight them on that. Then so be it, theyll go in june or july. I have thoughts on whether june or july is more appropriate, but it certainly seems that those two months are in the cross hairs. I was going to say, whats not to like . You could pick apart this durable goods report a bit. Nondefense exaircraft bookings dipped. It wasnt a sign people are wanting to invest in equipment. You can look at corporate profits. But has been the case at all during this recovery . The answer is no. Heres another way of thinking of capex today. Weaker on the proxy number. Guess wlhat we had to do to our capex. It took our top line gdp frofrom from. 35 to. 34. It it took it down a tenth. Did i hear you right you thought there should be several rate rises but theyve not done it . Over the course of the last couple years. If as an economist you think there should have been right rises but there werent, what are the effects on the assets markets . What are we looking at now . What i would say is this. The fed would argue they were in the right not to raise rates. We thought it was a slam dunk, there was inflationary pressure, jobs backed up, despite the issues going on around the globe. From the fed perspective, think what theyre trying to show the market, they are exceedingly sense to. If theyre behind the curve from what youre saying, you might have second, for example, golds to have done better because that surely is inflationary but gold hasnt done well. This is a great question. Its akin to one question that weve been getting from clients with great regularity, what will make the fed realize behind the curve . The evidence is already there that theyre behind the curve. So think about Core Services inflation. Core Services Inflation is 60 of inflation. Do you know what its running at right now . Its running a the a 3 pace, a 3 pace. First of all, its a quarter point at a time thats not a big move. I think they are independent. We do think theyre viewing the data dependency from a lens of we want to raise rates. Thesee the next recession coming in the not too distant future and they want to get as far away from zero as they can get and if they have the way to raise rates consistently, they will. I think youll see the biggest effect be the fact that trade between the zero rate Interest Rate policy in germany with a bund at 15 basis points, rick was talking about earlier that spread between the bund and treasury yield is just not going to get very wide. I agree with tom thats going to have a limit to how high the u. S. Treasury rate can get and that should alleviate some of the pressure on other countries that have more leverage than they need it our debt doesnt yield a really high level. If i can just make one last point on this because i agree with erik. People think that people this youre in the midst of the hiking cycle and tenyear deals are going to ramp up. In 04 the fed put 425 basis points into the yield system. It rose by about 10 basis points. I see a same sort of scenario playing out this time around. Were almost to june. Well see what happens in the coming month. Tom, thank you very much. Leaders are gathering in japan at the g7 summit today, abe shinze akiko fujita joins. Leaders appear to be in disagreement in where they believe the recovery stands. Angela merkel saying she believes there is limited growth. Shinze abe trade in the tpp also on the agenda here with the trade deal yet to be ratified. Leaders agreeing to speed up the process, and taking effect next year. As for geo political risks, the territorial dispute in the South China Sea dominating discussions but president obama saying g7 leaders also expressed concerns about the u. S. President ial election. Theyre rattled by it. And for good reason. Because a lot of the proposals that hes made display either ignorance of World Affairs or a cavalier attitude or uninterest an interest in getting tweets and headlines instead of actually getting through what it required to keep america safe. President obama there talking about donald trump. Tomorrow the attention will shift to hiroshima, where president obama becomes the first sitting u. S. President to visit the site of the nuclear attack. He has made it clear he will not make any apology, but today he said he would use the visit as a reminder to talk about the work that still needs to be done at reducing conflict and also nuclear war in the future. I do think that part of the reason im going is because i want to once again underscore the very real risks that are out there. And the sense of urgency that we all should have. So it not only a reminder of the terrible toll of world war ii and the death of innocents across continents, but its also to remind ourselves that the jobs not done. As weve been listening to the president , we are getting a quote on us foods, second biggest ipo this year. Mary thompson is over by post 8. Mary . Us foods opening at 24 1 4 and opened last night at 23. Call it just up about 5 in early trading. 44 million shares at the offering. Again, this isnt the biggest or second largest ipos this year, us food is one of the largest food distributors. You can see the marquee name. Another ipo that went public this morning, gypsum management supply. Its important that the mashes watch the premium. They want to see the ipos hold on to the prepamium above the i price. Cotiviti is another Company Going public, its priced at 19. Its indicated between 19 and 20. That indication has narrowed a bit and come down earlier, was indicated at 19 to 21. Thats another stock we will be watching. U. S. Foods, the marquis name going public trading up at 24. 22. Its a very active Stock Exchange today. Second largest food distributor, us foods now trading. The ceo will join us shortly. And coming you, one of apples major supplier arm holdings ceo will join us. Squawk on the street will be right back. Apple stock up 5 over the past week on reports of higher than expected supply chain order for the iphone center. Its said to be faster, thinner and contain a better camera. Were joined here if you look at your stock chart over the past year, it mimics apple on the way down and then it begins to jump. I wonder if thats because you have a message about where the future is and where youre going and its about analyzing images and identifying those images and processing those images to an extent we havent seen before. I wonder before we talk about apple whether you could describe where youre off to in a sense sp. One thing that people think about when they think about arm is the correlation between our company and our companys performance in the smartphone sector at large. Were thinking about long term how do people use technology, how is Technology Going to impact peoples lives and bring benefit to peoples lives and part of that is weve seen increasing proliferation of cameras and a need for technology to understand what a camera is looking at and thats driving some of our r d right now. So to identify a toddler from an adult and whether theyre near a hot oven or a humanlike figure in a secure area where they shouldnt be a humanlike figure. Is that about you supplying the auto driving smart cars . Its a technology in lots of areas. If cars want to be selfdriving, if we want selfdriving cars, then really being able to understand a scene and work out whats going on and what might happen next is crucially important. In smartphones people are looking for ever more sophisticated cameras to again detect what is going on in security applications, in drones flying around. There are just many applications where cameras are going to need to get smarter and were looking at a technology that it does beg the question of whether the internet of all things is going to be a lot of fairly simple devices or you seem to be describing, which is a howlike figure that looks through the room that, sees everything as essential computer and makes some big judgments on that. Which of the two do you think its more likely to be . I think its probably both. The internet is a very, very broad topic area. Were going to see tiny sensors embedded in parking spaces, in agricultural fields to determine whether the crop needs watering, very sophisticated Autonomous Security systems analyzing whats going on in the scene. Where are we in the meantime on the Smartphone Market . What are you seeing and hearing . Many people think theres no innovation going on in the smartphones and thats not true at all. Weve seen 100 times more compute power delivered into smartphones. We think as interfaces get more sophisticated, as use cases for smartphones continue to evolves, theres going to be an evergrowing need for more and more performance, better cameras, more sensors, better connectivity into the cloud. We believe the smartphones are going to continue to evolve. Can you tell us anything specifically about demands for more apple smartphones ahead of the key 7 . I dont want to comment on any particular phone. In general we think smart phones are going to get smarter. The way you use for today is very different the way you used it it years ago. Youre saying theyre going to need more brain. Whatever the hardware sales do, the brain within that, the architecture which you create is going to be greater. Can you see in realtime whats happening in the market or do people pay you royalties afterwards . Can you see the rampup . The way our Business Model works, we license technology to people who build chips that are into products, we get royalty a quarter after the chips get sold so were quite a while down that supply chain but we do spend time talking to people up and down the supply chain to understand trends so the r d today delivered five years down the road is hopefully the right thing. Us. Foods trading up. The ceo will join us shortly. Weve been tracking robert and kays journey to the hamptons. Robert took a helicopter. I left at 8 20, ive been at the beach for about an hour, on my second rose here. Im not sure where kate is. When we come back, were going to talk about all the companies that are making money for the race for the rich to get to the beach and how much it will cost you coming up after the break and after this rose. You wouldnt order szechuan without checking the spice level. It really opens the passages. Waiter. Water. So why would you invest without checking brokercheck . Check your broker with brokercheck. Looktry align probiotic. Our digestive system . For a nonstop, sweet treat goodness, hold on to your tiara kind of day. Live 24 7. With 24 7 digestive support. Try align, the 1 ge recommended probiotic. Lets just show you the chart of the day. Us. Foods ipoing here on the big boards. It opened up in the last ten minutes or so. Priced at the upper end of its range, selling shares for 23 apiece last night, raising more than 1 billion. This is the second largest food distributor in the nation. Memorial day weekend just around the corner, which means it is the official start of the hampton season. Well have traffic to look forward to, unless youre like our very own robert frank, who took a chopper there and is on the beach. Robert, hate to interrupt your beach time but tell us a little bit more about the costs at play here. I left the wall street he heliport at 8 20 and got here in 40 minutes. Its about 600 for a oneway seat to the hamptons. I raced kate rogers, who is still in her uber. You can see the map. Were both going about a hundred miles. Shes still out on the road. There a lot of services now making money from getting people out to the hamptons. You have the long island railroad, other Helicopter Services where you charter the whole chopper but blade in just two years has already flown 15,000 people in the northeast. Look, its expensive but ive already been out on the beach an hour and kates probably stuck in traffic. Lets check in with her if shes online. Hey, robert. I hope youre having fun at the beach. We are still in my beautiful uber on the way to the hamptons. Weve been in the car for about an hour and 40 minutes. We have just over a half hour left in our trip. We told you earlier about surge pricing. Originally our quote was 200 to 300. We wound up getting an uber xl but it was surge pricing, twice the normal fare. So its going to be between 600 and 700. But our driver is putting pedal to the metal so you better save me some of that rose. We should be with you in just over 40 minutes. Back over to you. You got it. So when kate gets here, were going to calculate on a dollar per minute basis what you spent and what you saved from taking uber or the uber of helicopters. Well bring that to you as soon as kate and i reunite on the beach. Kate says uber has dynamic pricing. Does blade have dynamic pricing as well . In other words, is it 600 and upwards as you get through to peak season . It varies a little bit but usually no more than 5 or 10. Tomorrow there are a few seats left but theyre already booked. So theres no official surge pricing at blade. Its pretty much standard. One seat is 595. If youre going further out east, its a little buiit more. There is no surge pricing. Thats an advantage. Thank you. Us. Foods shares todays ipo. Jake reese, day to feel alive jake reese, day to feel alive. Im courtney reagan. President obama sitting down for a working lunch at the g7 summit meeting in japan. High on the agenda, the sagging World Economy and what to do about it. Iraqi soldiers were camped on the outskirts of fallujah as at the continue their efforts to retake the city from isis militants. The city, about 40 miles west of baghdad, has been under isis control for more than two years. Mount sinabunk erupting again. It had been dormant for four centuries before springing to life in 2010. More than 4,000 people have been forced to flee. A pair of mellons sold in japan for a record 3 million yen. Thats approximately 27,200. They are considered a delicacy in the country. I guess so. Now to Jackie Deangelis with the eia data. The eia out with its weekly net gas storage report. Theres two issues to think about when it comes to nat gas right now. Demand is going to pick up as temperatures are increasing across the country and certainly happily here on the east coast for a lot of people, but at the same time, overall supplies are still in relatively good shape. Thats why theres a little equilibrium in that market. July is trading a little bit over 2 and the july contract has moved 6 this week and also moved 20 in the last three months. So right now were moving in line with that seasonality and the expectations of more demands coming. As long as the supply stays stable, we are going to see that equilibrium continue well into the summer, especially if it doesnt get too hot. Thank you very much. A billion dollar ipo, us. Foods, the second largest ipo of the year just started trading and it is higher now, more than 7 up, price of 23 a share on the upper end of the expected range last night and fresh from ringing that opening bell, we are joined by its ceo pietro santianio. You had a failed takeover by a competitor last year and now the ipo. Why now . That history is why our folks are so excited about today. We relaunched the company in 2011 under a strategy we called great food made easy aimed at the independent restaurant bringing Innovative Products and technology. Since we relaunched in 2011, weve been growing at twice the market with those customers. We have a great track record that paused during the merger as can you imagine and right after the merger, we got back on track. I cited in the prospectus. First customers sat on the sidelines. They werent sure which company they were going to join. Was it the old uz foods, the new us. Foods and that affected our top line. We lost some employees who were concerned about the uncertainty and literally after the merger was called off, our folks got back on track and you could see the momentum coming back into the business. We saw some strong growth, especially in restaurants in the First Quarter, after a pretty much flat year last year. Is that sustainable what we have seen in the First Quarter . Our growth with independent restaurants has been at two times the market ever since the merger was called off. The market for independent restaurants is actually quite buoyant right now, around 2 or 3 and were growing around 5 or 6 with those customers. Youre not planning a dividend unlike your big competitor cisco, correct . Not right now. Our goal is to use our proceeds today and in the future to get our debt down. After that well reevaluate what the best return of capital policy is. Where does the value lie in what you do, in an environment where online and internet disintermediatates everybody, it would appear, in a Delivery System . Is it proprietary . Talk to me about how you embed the business in the economy and ensure the independents who can go anywhere, let alone the government, continue to come to you. We do a couple of things, which are really unique to us. Weve built those capabilities over the last four or five years. The first one is we bring Innovative Products that help the customer, the independent restaurant innovate with their menu. Cauliflower. Weve minced it up, comes in a package, it can be used as a substitute for flour and gluten free product. That creates real stickiness between our customers and ourselves. 50 of our sales go through our ecommerce platform. That creates tremendous stickiness. If i said ill give you 50 to change to online banking, youd say its probably not worth it. If i can buy through amazon or i buy across the internet, i can go anywhere. There are pal pallets dropped off at the back door. Thats different. Gluten free, flour free, is there supply for those foods . We have a really broad offering. Whether youre a traditional bar and grill who offers a traditional menu with something that is more on the edge, we have a very broad offering. You know, we have a publication called the scoop, which we use for Innovative Products and this summer it will be all dedicated to sustainable products. Sara mentions m a. Do you trust deals that come on your desdesk . We look at competitors 100 million in sales or so, high penetration with independent restaurants, which is our fit and thats who we go after. Thats not on the regulatory radar screen. Weve got three of those this year. What about your two private equity sponsors continue to own the vast majority of the share, they didnt sell today. What are your expectations in terms of their selling plans . Obviously theyre going to want to try to hit the market at some point. So we havent determined over what period they will sell, as private equity sponsors in this business, theyre terrific partners. We would expect over time they would sell down. Margins have traditionally been extraordinarily thin. This a top line. You point out growth. Is there anything you can tell investors how you reduce margins, i imagine gasoline coming down is helpful. Weve brought a lot of play books from other industries to our industry. An example. Most competitors will put a flyer in front of a restaurant and say heres a discount and that discount applies to all customers, whether you buy the item or not. What we do is we personalize and customize that flyer. So if you buy something from us, you get a small discount. If you dont buy that item from us, you buy it somewhere else, you get a bigger discount. Were very thoughtful about how we grow and maintain our margins. What about food deflation . Youre hearing it from kroger and walmart. Are you seeing that . How does that impact your business . Were seeing a lot of volatility, particularly in the commodities like beef, its really come down. The best thing for our business is slow, steady inflation and we expect that will come back over the course of time. Pietro, thank you for joining us. Congratulations on the ipo. Pietro satriano is ceo of us. Foods going public today. Carl, the next chapter about gawkers saga is being reported by dow jones saying gawker media is exploring strategic options, including what could be a possible sale. Again, this according to dow jones citing a source familiar. The they also go ton to say they hired investment banker mark patrick to aid in this campaign. Gawker not publicly traded, a privately held company but concerns whether it can stay viable given the award that hulk hogan got in his case. We have calls out to gawker media and its representatives f for comment. We have not heard back but when we do, well bring it to you guys. Coming um Tim Westergren on pandora fighting off spotify. Back after a break. It felt like i had just gone to the dentist. My teeth are glowing. They are so white. 6x cleaning , 6x whiteninga in the certain spots that i get very sensitive. I really notice a difference. And at two weeks superior sensitivity relief to sensodyne i actually really like the two steps step 1 cleans and relieves sensitivity, step 2 whitens. Its the whole package. No ones done this. Crest healthy, beautiful smiles for life. The fed . Nope. Oil . Nope. Is the chinese currency the the real driver of the markets . More coming up. Try the superior hold. Of fixodent plus adhesives. They help your denture hold strong more like natural teeth. And you can eat even tough food. Fixodent. Strong more like natural teeth. Fixodent and forget it. Welcome back to squawk on the street. One of the most heavy weighted index down fractional today. Names like charles schwab, citigroup and regional financials. This could be the third month of gains for the financial sector. The last time that happened was the three months ended december of 2014 and for the year financials barely negative so certainly a sector to watch, especially given all of the fed anticipation next month. Its all about the front end of the curve. Lets hand it over to Rick Santelli of the cme. Good morning, mate. Mate, listen, i have a whole thing laid out. But youre talking about the front end. Everybodys concentrating on it because of the fed. I just want you to follow me a second. This pits pretty darn busy. They talk about pits being dead in chicago. This is an options pit on a short rate 90 day forward for the libor. The reason i bring it up, a lot of activity today. Why is that pit so interesting to me . As i look up, the futures the options are associated with are up 3 or 4 basis points in price today. As i look at fed fund futures, theyre up a little bit in the front but the further back you go, for example, as i look at october, its up 1. 5 points. What happens when these short rates move up and fed funds move up . It diminishes the possibility of a fed rate hike in the eyes of investors that are doing the trading. Granted it could be that it priced too far and its Short Covering, theyre lightening up. But no matter what the reason, if youre not as aggressive looking for fed tightening things change. Why is this important . Ill go to the topic i was planning to use today. Its all about divergence, not the movie, central bank policy. Weve seen a lot of guests today talking about things i like to talk about, the relationship between our yields and bunds, relative value trade, talking about various tightening cycles in the past like 04 to 06 and how much the fed moved versus how much tenyear rates moved. Heres the issue with history and why that markets so important. Market gps, okay . All these other issues in the past, fed Balance Sheet, European Central bank Balance Sheets werent like they are today. In terms of pricing and response, its hard to divide how markets are going to react when so many policies have tried to control the outcome of things like Interest Rates and reflection of those policies and the value of financial assets. So how this all reacts, for example, relative value trade pulled our yields down when europes yields were going down. But if the policy diverges and the fed is the odd man out starting to tighten, will europes rates put a lid on ours . It sounds like a good theory but the problem is it is a theory. We have the biggest divergent policy coming up in history at time when the Global Dynamics and Financial Markets have never had the Current Conditions or been experimented on to the degree they were. What will the outcome be . We can all debate it but the issue is nobody knows. Back to you. Well be watching the markets, especially Foreign Exchange on that divergence. Rick santelli. Ahead in the show, real roller coasters but with computer animated thrills and spills. Why six flags is putting Virtual Reality on roller coasters this summer. Olay luminous illuminates skin with pearl optics science. Your concert style might show your age, your skin never will. With olay you age less, so youre ageless. Olay. Ageless. Herthey work hard. Ade, wow, that was random. Random . No. Its all about understanding patterns. Like the mail guy at 3 12pm every day or jerry getting dumped every third tuesday. Jerry every third tuesday. We have Pattern Recognition Technology on any chart plus over 300 customizable studies to help you anticipate potential price movement. Theres no way to predict that. Td ameritrade. Oil the key focus for some people. Earlier in the section we broke 50 a barrel. A lot of comments about what this means for shame producers and ultimately the saudis. Well come back to that on and more on that later on cnbc. And the theme parks will be op opening this memorial day weekend and samsung is teaming up to put Virtual Reality headsets on nine roller coasters around the country. And joining us is john duffy the ceo of six flags. Good to be here. And how does this work . You are going to be putting Virtual Reality headsets on people on a roller coaster . Yes, you are transforming a ride into a 360degree experience, and the riders will be able to get on the roller coasters and put on the samsung gear, vr headsets and have a completely new experience. So think about this where you are riding on the roller coaster, but you are basically fighting an alien invasion, and you are a copilot in the fighter jet fighting the alien invasion soaring through the streets of a city. You know, some people might think that actually seeing yourself fly upside down and the trees and all of the rest of it would be enough. But you know, the realle roller coaster experience, and couldnt you put them on chair simulators and have the same effect, and why send them around the course . That is what is unique about the experience, because we are actually syncing the visual with the physical. So while you are soaring through the streets, you are actually getting air time so that you are really feeling like you are in the fighter jet, and one of the beauties of what we do is that because it is synced precise ly the visual and the physical is synced precisely, there is no nausea whatsoever. And this is important, because since the bankruptcy, you have had a phenomenal record and the stock is up over the last 12 months, 21 in a market that is not doing well, and what is exciting the investors here is that you can take a ride that arguably might have to be replaced, an older ride that people are less interested in and quite cheaply transform it toub something that the kids will cue up for. And that is the point as the investor here . That is the busy of the Virtual Reality, because we can take the older ride which may not get the throughput that it once did and transform it into a great new experience. And can the new innovations be a price increase for something that some investors are looking into . Well, it rolls into the overall capital strategy of having something new and exciting at our parks ever every year, so what it does is to bring the people into the park, and then it is all about giving them the great experience at the park. So Virtual Reality is is one piece of that. And give us a ball park figure, and how much do you replace a ride at each site each year, and roughly how much does it cost and cost to retro fit something in Virtual Reality . Well, we are not replacing the rides every year, but we are adding new rides and adding the capacity to the pa every year bying having something new and exciting every year, and so the ro roller coaster can run anywhere from 15 to 20 million. But vr is a fraction h of the cost, and less than 11 million, and we can actually add the vr to one of the existing roller coasters. And what about are you doing with the business and the international expansion, and where are you with that . Well w are excited about the international, and we have announced three deals date. And we have announced a deal to design, build and ultimatelys assist in the running of the park in dubai, and we have announced a deal to do multiple parks in china and then we announced a deal to do a water park, and theme park in vietnam. And do you own them or desip them as the brains . The blueprint . Well, that is the beauty from the investor standpoint, we do not own any of the parks. We are partnering with people who will invest money and find investors to come in, and so for us, it is a franchise model and lucrative and ongoing revenue stream to get every year. I was going to ask about the u. S. Consumer, because it is a mixed picture now, where they are not spending at department stores, but they do seem to be spending on the experiences. How would you characterize what you are seeing as far as the health of the u. S. Consumer . Well, there has been a shift away from the people wanting to buy things, and now it is all about having some great experience that they can share with their friends and their family. And i think that six flags, it is perfectly into that. That is one of the reasons why we have seen tremendous growth in our at ten dabs. We were up 11 in 2013 and up 37 in the First Quarter of this year. Thank you, john duffey joining us, the ceo of six flags. We have breaking news on donald trump. Eamon javers has that. Well, it is official that donald trump now has the number of delegates that he needs to become the republican president ial nominee according to nbc news, and donald trump has crossed the 1,237 delegate threshold that we have been watching so closely throughout the entire primary process. That will make him the official republican nominee, and in july at the Cleveland Republican Convention where they will offici officially do the deed, but according to nbc news, h this is now past the threshold that he needs to become the nominee, and meanwhile on the democratic side, Hillary Clinton is unable to seal the deal against bernie sa sanders, and she is at 2,304 delegates out of the 2,383 that she needs in order to become the nominee on the democratic side, and we will continue to watch that one which is becoming a little bit of a squeaker, guys. Back to you. So he is from presumptive to actual. And from presumptive to presumptive until cleveland in ju lieu lie, but now he has the delegates and officially over to the threshold, but everybody else running against him is dropping out, so it is a threshold that we have been pointing to all election season. And the ceo of pandora is coming up next on squawk alley. Stay with us. Days scientists and medical Research Companies are blurring the lines between Science Fiction and science. Who is cracking the code to your mind and body . Modern medicine reports throughout the day on cnbc. It is the race to the h hamptons day on cnbc this morning. Lets check in with robert frank who made it before everybody else to the beach this morning. Hello, robert. Yes, simon, and kate just got here. I maid d made it. And in two hours and 50 minutes, and something for you, the blade crew brought you the row say, and so what we have worked out is the time value of the money is that my trip was 500 more per person and her s is an hour and a half different, and so you can figure out if your time is worth 300 per hour to save on the blade or worth the drive . We have a Scientific Study and we will have our drink, and head back to the city. That is the type of the scientific city that i love. Thank you, robert frank with the race to the hamptons and for the entire team of sigh squawk on the street and sarah is getting married this weekend, and she will be back. Yes,ly be back from the honeymoon to give you updates on the vietnamese huang. She going to be missed. Congratulation, sarah. And it is 11 00 a. M. Here on squawk alley and we are live