Its a take over tuesday. Weve got a lot of deals to tell you about, and were going to break them all down for you. Finally this morning, apples big event is tomorrow. Were looking ahead to what infectors should expect, but stocks are set to open higher after the u. S. Added 151,000 jobs in august, investors still aer watching the fed, in anticipation of the september meeting and donald trump speaking out on rates in ohio yesterday and sounding quite different from an interview he did on squawk box back in may. Heres those comments what he said a couple months ago. Ive always been a lowInterest Rate person. If inflation comes in and we dont see any signs of that, but inflation starts coming in, thats a different story, then you have to go up and slow things down. But right now, im if for low Interest Rates and i think we keep them low and we have to compete. Theyre keeping the rates artificially low so the economy doesnt go down so obama can say he did a good job. We have a false economy. We have a bad economy, everyone understands that, but its a false economy. The only reason the rates are low, so he could leave office and say, see, i told you. At some point, the rates will have to change. A comment largely about what the next few months are going to be about, increasingly political. If were a also economy, the other guys are more false. Europe is completely false, im seeing good data out of europe. Car registrations are good, some earnings are good. Japan is i dont know, theyre buying etfs. Theyre buying every stock. Everything is kind of in the end, relative. And while i respect any candidate to talk about this, i dont know if youre calling for lower rates or higher rates. Lower rates of inflation could you help me here, david . I cant. I cant and i wont. I need you for help. I will tell you we did a jobs number on friday that was 151,000 below the expectations but most economists stuck to their forecast, whatever they may have been in terms of those rates we are talking about, whether the fed of hike in september or as soon as i guess a couple weeks from now. Nobody changed. It was really interesting because the bank stocks stalled a little bit, but it was almost if this was in the cards and were still going to move september. I think the Stanley Fischer interview was rather amazing. Hes the heavy and he puts out there could be two hikes with steve and after that i think people just said theres got to be one, so lets just get it thats what really changed the dynamic. It was fisher saying it could be two. Its hard to take that back and have none. You buy the argument that whether its september, december, whatever, the fed is more hawkish now than they were several months ago . Absolutely. And absolutely. And that keeps the lid on stocks . I think theyve been saying data dependent, but if theres any sort of exogous event overseas were not going to take action, and right now, the g20 meeting, seems okay, japans propping is up perfectly, and europe and brexit. You do have the respect for political change, in terms of populous parties winning larger and larger followings. Thats true. In germany, for example, some recent elections there. Merkel delved defeat, but i think things are fine. If we added 40,000 jobs i think wed all be saying this is maybe september, december, but retails are strong, auto sales have been okay, housing is strong. Not a lot of inflation but i think they feel that rates are too low, and that this didnt change it. Were going to talk more about that over the next couple weeks, and the other thing is david told you a lot of news in deals. Embridge, to buy spectra, worth 28 billion, and danaher buying sefid, and buyer monsenaanto. These are real deals were talking about and i want to get the take on embridge, but this has been going on since the spring if you recall when buyer came with a 122 million bid. The latest is 127, 50. We would not have learned for it if not for the jerp man publication, and the uk, namely when a publication or media outlet comes out with something you need the companies to confirm it publicly if it is in fact correct, and so they did, and thats why were hearing about this. What i can tell you is it does appear monsanto and buyer are moving closer to a deal and we could see that within the next week or two, according to people familiar with the situation. 127. 50, monsanto made it clear theyre close on price so the expectations its going to be 130 perhaps will normal be met and be see deals as low as 12,850, but theyre getting close on things thatll go along with any deal including deal protections given the antitrust scrutiny that would be undertaken and primarily, the eu, theyve been doing a lot of scrutiny of all sorts of things. Theyve got an agreement or close to it what the overlaps are in the business and this is kind of color that i can give you, as well. A lot of Due Diligence has been done by bayer and there have been multiple drafts of merger agreements. None of this is to say a deal will happen. Monsanto tells in their statements and ive reported on them, as well, other proposals and other parties and other strategic alternatives, but we dont know what those are and ive gone on a number of roads and had various things denied so i cant tell you what they are. But specific to bayer and monsanto that began in the pursuit in the spring and now were entering the fall, it appears a deal could be quite close, perhaps a little as a week or two away. They seem to be coming close on price. Some people may be disappointed, jim, but monsantos business has not performed well. It has not. When youre talking about trading 18 times ebitda, who started at 122, thats not going up very much. Perhaps some disappointment, well see. Dupont, two c companies in the world, forget about it. I mean, the eu doesnt even want to see these two companies talking. I mean, this is again, a bunch of lawyers who dont worry about it. Can i just say, having gone to law school, that you can call me for 1,000, i will tell them this deal doesnt just pick a bet for charity, of course. But this is another one. Do you think of those hurting in the country to begin with. And its going to be closely reviewed with dow and dupont. You have your doubts, and well have to see what kind included in any deal when and if we get it from these two. The spread is because the likelihood of this deal happening is fansful. It its fanciful. Youre talking at least a year, likely. Its seed and these the farmers in europe and the farmers in the United States protected classes. Theyre protected classes. And you cant do anything that makes it so they suffer, because theyre very powerful. We forget, the ag lobby, very bent on that. We have some other deals this morning, too. Yes, lets get to those. Being you are a pipeline guy, who can name pipelines. I know where they go. Embridge is buying spectrum, in which the two shareholder bases will end up with 43 will be owned by spector shareholders. Its about 11 and 1 2 , creating what is going to be the premier liquids and gas company when it comes to transporting this stuff. Embridge is liquids andspe spec is gas. Spectra, already have 50 for the year and yield nice 4 plus. Im shocked at this deal. Shocked because if there were two companies that were doing well, as opposed to putting together these drunken sailors, it were these two companies. Spectra is the pipeline from south to north. We dont know if we need that anymore. They the pipelines to the northeast and maybe to new england. Its very hard there is the environmentalists have really coelesced and they will continue to be a big part of this combined company. And i dont know if they need all of this canadian pipe. I dont know if they need it. Im saying this is a great deal for spectra, but they were doing great without them. I was very surprised. The people in the industry said, are you kidding me . These were the two that didnt need to do a deal. Monaco and eagle, are really protected at enbridge, and spectra, unlike a lot of jokers who went nuts in the absolute high. And the thirdlargest companies in canada. And biggest infrastructure n north america. Enbridge is pretty much everywhere. I just gave them credit. I like the deal from the point of view of enbridge being able to combine and become a nationwide company, but make no mistake about it, spectras real value, up from the gulf, what theyve been able to do in new jersey and new york, and new england, which by the way is still oil from overseas, venezuela. Finally, were getting some reporting on the folks, Gretchen Carlson lawsuit, who had sued former fox chief, roger ails, and saying roger ales will settle for carlson sfor 20 million. Whats curious is her case was against ales personally, and now fox appears to be acting what vanity fair says as insurer to a ales. The new York Magazine piece on friday, 20 million, got off pretty light. Did i read that piece . I read every word of it. Every word of it. This is sara ellison, who weve had on a number of times and her reporting is usually spot on. Well see if we get anything from fox but that would settle that. The question is the actual network, and what james murder do and himself decides what to do. They are threatening to sue sherman of new york smmagazine d issues what the company is calling apology, so well see what this ushers in for fox. A level of repudiation, rather remarkable. The new York Magazine piece its like this thing unraveled in days well, his career. It it came to conclusion quickly after what would appear to have been many, many, many years. Often when you have tapes, things change. Roger ales e i know know sher to ales they explain why they can go after gabe sherman all they want, but that guys money in terms of his sources, gees. Theyve been out in front. When we get more this morning or official word well get it to you. Coming up what we can expect ahead of apples launch tomorrow s p 500 has not had a single move since july eighth. Were back after a break. s beenl being back so were constantly going over our data limit. Oh, well, now all of our new plans come with no data overages. Wow, no more overages . So that means. Go on. Say it. Well finally be in control. And re back. Introducing new at t plans wh no data overage charges. This is my new alert system for whenever anything happens in the market. But thinkorswim already lets you create custom alerts for all the things that are important to you. I guess we dont need the kid anymore. Custst alerts on thiorswim. Only at Td Ameritrade. Wore watching apple ahead of the big product event tomorrow, the companywidely expected to unveil the next generation of the iphone 7, and could announce new versions of the apple watch, ipad, mack. T the biggest headline should be the elimination of the head phone jack but its unclear if other major additions are coming. One of the great parlor games, jim is figuring out what theyre going to say before they say it. The press ahead of this is kind of like unless youve cracked your screen, youre not going to buy it. This is the least amount of hype ive ever this is like the one that no one wants we havent seen it but boy do we know not want it. Right. And typically, you want to know what chinas thinking and looks like chinas kind of not much going on there. But india and brazil, if you go back to that last conference call, i think it matters how the phone does in the other places where there are emerging markets. Not just the United States, but theres not always a lot of excitement. Always important to point out, its not sure how many of a cap this keeps on growth or replacements, but the quick installment plans that are the rule for the wireless carriers, you get to the end of your plan and then your bill goes down and you can keep your phone, and if you dont feel you need to upgrade, youre finding yourself with another 30 in your pocket that can have an impact on peoples willingness to trade up if theres reason to do it. Apple as a nogrowth stock, apple has a game it plays whether it goes up or down. It is the servicerevenue stream and maybe its something surprising about the watch that could matter because this phone, which is obviously the biggest driver by far of earnings, is just going to be okay and everyones kind of just eh. Now the stock has had a big move from 93. I think people just said, look, it got too cheap, but i i wish there was some excitement about it. Are you going to get one . Unlikely. Really . This time around. But if were talking about the head Pope Benedict xhone jack, something is amiss. The expectations are solo, easy to pass. I guess so. I was working out yesterday watching strike back on my phone while i was working out and realizing im just one step away from being choked by my headphones. You know, its like look at that, i can just go like that. So maybe im a candidate just because i use i watch yes, do you. Now, if i had been watching narcos, i would not have risked that. Gotta go wireless. Thursday, broncos thanner thipa you can imagine that game . Gees, who has that . Im not sure. I think we might. I gotta get wireless. Go wireless. Well get cramers mad dash and well count down to the opening bell. Take one more look at the futures on this tuesday. Welcome back from summer. More squawk on the street from nyc straight ahead. Upgrade your phone system and learn how you could save at vonage. Com business [enginrevs] [cheering] the highly advanced audi a4. About seven and a half minutes before the opening bell here. It is a tuesday for this mad dash. You want to go to eog . Yes, eog is the largest producer in the lower 48 of oil. But theyre not done. Theyve just bought the yates field, but their yates acreage is largely personalien, new mexic mexi mexico. Every time theres been one of these deals and here they issued 126 million shares. Every time theyve done one of these deals, the acquirer stock has gone up and you you say to yourself, all right, where are the majors . You know, simirex has all been in there buying and buying. Pioneer and permien is the cheapest. Cheapest in the lower 48. Its a real company. That was mark papa that built this company and retired. One of the things thats amazing is eog shifted away from eagle ford. Its all permien. Sheffield at pioneer said had the equivalent of 2 oil at personal i dont. The new mexico stuff, ive never trusted as much, but eog, these guys use Reservoir Technology from corps laps so maybe this new mexico is much better than i thought, certainly drillingss much cheaper, so any way, this is a big deal and the stocks going to go higher, not lower. All right. Well be watching that and get you to some other deals, danirer, and volkswagen and n navastar. Certainly an interesting deal. Weve got the opening bell, six minutes from now. Youre here touy a car. Wh keeping the power lines clear,my job to protect public safety, while also protecting the environment. The Natural World is a beautiful thing, the work that we do helps us protect it. Public education is definitely a big part of our job, to teach our customers about the best type of trees to plant around the power lines. We want to keep the power on for our customers. We want to keep our community safe. This is our community, this is where we live. We need to make sure that we have a beautiful place for our children to live. Together, were building a better california. Across new york state, from long island to buffalo, from rochester to the hudson valley, from albany to utica, Creative Business incentives, infrastructure investment, univerty partnerships, and the lowest taxes in decad are creating a stronger economy and the right environmt in new york state for business to thrive let us help grow your companys tomorrow today at busins. Ny. Gov [phone buzzing] some things are simply impossible to ignore. The strikingly designe lexus nx turbo and hybrid. The suv that dares to go beyond utility. This is the puuiof perfection. Youre watching cnbc squawk on the street live from the Financial Capital of the world, the opening bell in just under three minutes as we all get back to business with a lot of news on tap. Weve been through some of the deals today but well get services ism at the top of the hour, after that contraction in manufacturing which gave some people a scare. Yeah, that was not look at the individual regions when they did the reports. I didnt see that coming at all and i still cant get grasp where that is. We have residential construction, nonresidential construction, weve got very good auto build. I just couldnt figure it. Sometimes these numbers are a mystery. Relatively light macro week. Well get williamsburg tonight, but nothing like the last couple weeks. Weve been bombarded. Today are individual stocks and people taking action to help themselves. David mentioned this navistar. And comings was not going up, it was going up for a turn in orders in china but that stock is down far more than i ever thought would happen. Navistar is i guess here to stay. Vw taking a couple seats on the board. They bet on the u. S. Class eight and media truck market. And the u. S. Class eight has been horrible. Comings has a clean air engine. Navistar had a number of mistests, not the likes of the scandal of volkswagen, but theyve watched their market share go down. Navistar, to go to this investment is from volkswagen. And at a premium. Its trading even above where theyre investing. Its having a very positive impact, because it will, as you say, takes them from navistar was you used to meet hedge fund members navistar. Congratulations, hey, thats great. Speaking of investments, ge buying two european 3d Printing Companies for a total of about 1. 4 billion. We got stratus hired on that. Stratus does some they print metal for these things . And alcoa has just spent a fortune on 3 d, al, c oa isa aerospace, too. If you buy ge off the this, youre nuts. Its a huge company but ge continues to be digitized, but should not be moved on that. Now, i want to go back to the enbridge spect radeal, thats a fabulous deal for both. The acquirers are doing well. Theres the opening bell. Snp at the bottom of your screen, its rains brands celeb ra celebrating the tenth victory, and apranga, from the baltick states. Jeffreys adding urban to the franchise list. The urban comforensinferences probably the best. Urban outfitters, free people, they talked about how this is a nonpromotional fall and fashions back. I thought urban got down and really just kind of crushed the stock. This is the first good quarter from hitting all cylinders. I thought it was all cylinders squared. That and foot locker were the two best. Its interesting the raihane brand. That stocks been low. One deal we do not mention was the danaher deal. We dont focus as much on them as perhaps we should, given how successful that company has been. Sefi did is a global, melee cular diagnostics company. Theyre paying a big premium for the company, all cash, 53 a share, of course it needs shareholder approvals and see the deal closing around the end of this year, and theres not seen much of any trust or anything like that and of course shares are up 52 trading nearly the 53 allcash bid deal. They do a lot of work in hospitals and the independent reference. What i like about this, is danaher, when they spun off their heavy machine said they were going to go all in Life Sciences, Life Sciences is something that is a very exciting, fastgrowth world, so this made a lot of sense. This is danaher doing whats right to be able to bulk up on life science, which may be the Fastest Growing of healthcare. They are doing the right thing going higher and not lower on this. When i covered them, they were really the wells brothers. I said wow, this stock should danahers been a winner. There are a couple companies that are really kind of Great Technology companies that are industrials. Ge is trying to do the same thing and has a division thats Life Sciences, that has to get involved more and has to do some more acquisitions. A lot of discussion about inin intel today, and inquiring movidius, which make chips for drones. We at any time to watch their information. Intel continued with a notgreat outlook and the stock has been on fire. Marvel tech reported a good quarter, but i think they could get acquired, but im amazed at intel amg. Theyve been a rocket. A lot of that is this chip shortage, fernand and for dram. Intel, weve been waiting for them to sell that security division, mcfafee. How about piper on net flicks, some of the parts 1r, 1 . Theyve been trying to get that thing rolling now. Amazon up 14, google up 2, neck fli netflix has been down. I saw the piece about some of the parts. This is the piece about u. S. Subscriptions and they were weak two quarters in a row so people dont want to give them the benefit of the doubt. I think theres a lot of belief that competition has gotten very tough in this area from amazon. We do have confirmation of something we were reporting earlier from vanity fair, 21st century fox has put out a press release, guys, saying it has settled a lawsuit with Gretchen Carlson during her tenure at fox news, she maintained the highest level of journalism, and they are paying ms. Carlson 20 million and the settlement has been confirmed by 21st century fox this ongoing story that of course the main part of was the very quick dismissal of roger rog roger ales, who created folks, chairman. Fox stock has been particularly bad. People feel that was a billion dollar operation that could be in trouble . Who knows. Its one of the prime generators of cash flow at the company is fox news and there have been questions given the change in leadership, whether over time there will be a change in programming at all. That remains unclear. But certainly its got to be something investors keep in mind and say the Growth Profile of this company, which has suffered on a number of fronts over the last year, the stock is down almost 10 every day. The rest of the group is kind of treading water. Sounds like its been red hot. Also, twitter has a Board Meeting. Rico has written a piece about that. I did something when you were o w away on thursday. These comments were by eb williams. The comments got a lot of attention. That Board Meeting will be important and the stock had been moving up which we pointed out. Nothing new that recode did the same thing. Bob pecks story was difficult today, twitter not in play, the first year, i think there are a the love initiatives. I would be curious to see what comes out of that meeting, that he may be correct, mr. Peck, but its not clear to me, which is the reason i did the story on thursday, because i think there are going to be some important things discussed there, particularly, again, to come back to the idea that this board knows that there is the potential at least for some activist investors to make their life more difficult. The nominating window for directors does not come up until, but theyre aware of that, theyre aware that you cannot put up the top line growth they have in the past and expect to go on your way and have a long leash, so i believe it will be some discussion of that meeting on thursday and youve got to wonder as part of that discussion they say, is it time to at least consider other options. Wow, so youre throwing cold water on pecks cold water . Yeah, im just reiterating what i reported on friday on thursday, which you were sitting right here for. You remember. We had a conversation. I remember like it was yesterday. It almost was. Yes, it was. Although weve waited so long for the pay off on this tfl deadea nfl deal, it seems as were going to see what the season brings. Did you see mcdonalds . They need salesmen. Mcdonalds moving in a way that hasnt in long time. Thats kind of interesting. On twitter i want to correct myself. The nominating window is not until the end of january for directo directors. I remember that from thursday. You did which is yeah. Ive been back and forth. Hes a very good analyst, with a good read on things, no doubt. Maybe talk to more board members, i dont know. Are you saying they may have been contacted . You do . You think so . Do you remember what i said . I remember every word youve always said. I can go way back into the way back machine. I just thought a certain point, i thought the sales force might be interested. They should be but weve got dream force coming up and nothing happy announced. Dream force in october, the first week. You may want to be there. Theres way back, who is mr. Peabod and who is sherman . Im natasha. Im boris. I knew. You communist. He got the scariest emails. Now im going to mess with you selections, hahaha. You are so good. I miss that show. Lets get over to dominick chu and see whats going on. I cant look at david or jim this morning. Any way, were talking about wall street getting back to work and if you are a commuter in the tristate area you kind of got the feel of that, a lot more people on those commuter trains in the area and its the same thi thing. What we have is the beginnings of the volume pick up as people get back to work, as kids are still going back to school, maybe some people still out of the office, but we have a positively moderate day, as for the early sectors winners and losers, if there really are losers, generally speaking, the markets higher. Materials are kind of up there, as well, the consumer dis discretionari discretionaries, also the financialspector spid financial spector signs and a big part of the bull story over the last couple weeks well see if it goes higher. Lower volumes then well see volumes pick up now. For the over assume picture for the mack i donro side of thingsa look at gold. We have seen i nice uptick, and a steep collapse that would takedown a lot of those miners and the mining stocks were among the hottest trades to start off in 2016 so well see if that happens and bond etfs, remember high yield bond efts have been doing relatively well to the market. Well see if that picks up with some more volume, back over to you. Thank you, don. Lets check in with Rick Santelli from the cme group in chicago, rick . Reporter good morning welcome back, gang, looking at your day of tens, its nothing we havent seen before, but it is on the muchextend the range as we hover near the 160 level, you talk about a tight compressed range, this is it. If we cold look at boone deals we could see they are on the move, as well, but maybe a bit of a different direction and the one chart thats very fascinating is when we chart ten year japanese government bonds. They are very close to touching zero. Its been a long time since the negative jgb 10s, about the middle part of february of this year as you see on the next chart, but finally, maybe the most fascinating path were so wrong in predicting but many Foreign Exchange traders have talked about it, the pound versus the dollar. The pound has a doublebottom, a rather sug standpoibstantial on is the chart you want to Pay Attention to. Whether its you know the dollar improving against the yen, or japanese rates moving up or whats going on with the pound its illlod it its illogical. Theyre rather counter intuit e intuitive, as well. Carl, back to you. All right, rick, thank you very much. Rick santelli. When we come back, the cover of vanity fair has a deep dive on faranos and elizabeth holies; plus, Morgan Freeman on the legacy and the title of one of his most famous films, when squawk on the street continues. Were drowning in information. Where, in all of this, is the stuff that matters . The stakes are so high, your finances, your future. How do you solve this . You dont. You partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. Morgan stanley. Farm fresh ingredients, stepbystep recipes, delivered to your door for less than 9 a meal. Get 30 off your first delivery blueapron. Com cook. A new. A new episode of binge is out. This ones Morgan Freeman and his long time producing partner, lori mccreery. This is freeman in the shawshank redemption. You know, word of mouth is the marketing tool. I dont care what you spend. If word of mouth doesnt catch you, you aint going anywhere, right . So imagine going to see a movie and then going to your friends and say i just saw one of the most tarierrific movies called chip, sha chi chip, shang. Reduction. Never mind. You must have been like i did this thing years ago and im suddenly hearing about family, friends on the street . Anyone that saw it, really held it in very high esteem, thats just they couldnt sell it because they couldnt say it. You have said the title they got the title wrong . Yes. I said that, thats what. You they said the full title wont fit on the marquee. I said so what, dont put the full title. Youve got a onesheet. Put the title on the one sheet. Everybody can say rita hayworth. Classy gentleman and a great producer. They produce madam secretary on cbs. We talk a lot more about the future of video creation, digital streaming, distribution, and the one stock that he is so obsessed with, that he checks prices when hes not shooting onset. Not going to tell you now. Gees. But its a good one. One of my eras. A lot of ceos are obtuse like the warden. Its a classic. I watch today on a airplane and i pilot said listen were not finished with the movie and theres people who want to finish the end of the movie. I realized what a classic. On an airplane. Any way, you can watch more of season two of binge on apple tv, hulu, and cnbc. Com binge. Well get to stock trading in a moment. Dow is up about 36 points, be right back. A great school, butt the right the one for her . Is this really any better than the one you got last year . If we consolidate suppliers whats the savings there . So should we go with the 467 horsepower . Or is a 423 enough . Good question. You ask a lot of good questions. 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Weve helped the Marine Mammal center go solar, install electric vehicle charging stations, and become more energy efficient. Pg e has allowed us to be the most Sustainable Organization we can be. Any time you help a customer, its a really good feeling. Its especially so when its a customer thats doing such good and important work for the environment. Together, were building a better california. Great time for a shiny floor wax, no . Not if you just put the finishing touches on your latest masterpiece. Timings important. Comcast business knows that. Thats why you can schedule an installation at a time that works for you. Even late at night, or on the weekend, if thats what you need. Because you have enough to worry about. I did not see that coming. Dont deal with disruptions. Get Better Internet installed on your schedule. Comcast business. Built for business. Time for crimer aamer and s trading. People have been stunned by gilliard. They developed a drug that cures hepc. It shows you how much Companies Want to develop, that works. Jeffers is saying its really cheap. Theres no catalyst to buy something. You pointed out many times it has an enormous amount of capacity, gilead, but they havent done the deal. I cant believe they havent. A lot of companies are being bought and sold in that area. I put this up because david mentioned it. Cities Texas Instruments was interested in linear, which Analog Devices bought. People are going to say zylinds is i still think marvel, but not really Texas Instruments. This is the one that refuses to day, theyre not that comparable to linear, by the way, but people feel Texas Instruments was going to gear up six months ago there was a lot of rumors texas was going to do something, never got to the bottom what they were thinking about. Texas instruments bought national semi. It was maybe the most brilliant acquisition, now obviously arm holdings, they hope thatll happen. I dont know, thats your men. Mr. Matason softbank. I think when i look at the deals in semis, do not give up, or sell your semis. These are all in play. On broad market stuff, vix was below 12 on friday. Its a little bit above there now. Does anything change . Are all the players on the field . I would like the vix to be higher. I think theres a lot of wild cards. We dont want a lot of preannouncements today. Companies came in for july and august and feel like they cant make their numbers. Thats a hopeful sign. I was watching alibaba go up there throughout the show. So yahoo, even though thats a Holding Verizon deal had nothi to do with it. Well change the legacy. It wasnt her deal originally, although she did do things to unlock the value of baba. Doesnt get talked about much. Not really. Whats on mad tonight . Im looking at apple because i think people have basically said this is a hohum. I like hohum, but the chart, not so hot. I play one on tv. Weve got a lot to look forward to this week. Yeah, exciting day today. We do have nwe do have broken cos. Congratulations, harry roseman, he got a first round pick for a guy who was going to be gone at the end of the year any way, referring to the eag s eagles. The bradford trade. Roseman, one of the great deal makes. Ill be there against cleveland, but not as significant as the broncos game. Broncos got rid of sanchez. Ef weve got our own issues in denver. Im a little worried. No one has ever repeated the number of count downs. Thank you in fantasy world. Were going to see in the next few months whether sports are immune to time shifting, right . They are. To cord cutting. I think thursdays going to be a huge game and everythings going to stop in my house. I havent told my wife yet. She doesnt know about my draft wednesday. Me said the ladies have to get together. Its like a cone of silence. Its just she didnt. Wanted to know on friday. She goes, do you have a show . I said belt atter just to sa mad money, of p. M. Eastern. Comi coming up, a look at what to except for apple, a look at some new products and what it means for the spot, and aaron levie after that stock with his company, more on squawk in a minute. This car is traveling over 200 mis per hour. To win, every millisecond matters. Both on thtrack 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. Using 60,000 points from my chase ink card i bought all the fruit. Veggies. And herbs needed to create a popup pickyourown juice bar in the middle of the city, so now everyone knows. We havsome of the freshest juice in town. See what the power of points can do for your business. Learn more at chase. Com ink good Tuesday Morning welcome to squawk on the street, im carla quintanilla, live at post nine of the new york stock exchange. We get back to work after the labor day weekend, holiday shortened week obviously on this tuesday, the dow off about a tenth of a , s p 500, 2, 181. In the meantime, coming back to a fair amount of news flow, david we talked a lot about deals of varying sizes the top of the nine. And weve got quite a few of them, carl, and whether they be investments in the case of navistar, and volkswagen. Ge doing a deal, danaher doing a deal of some size, and more from monsanto and bayer. And the big apple event tomorrow, were going to keep our eye on that and later in the week youll get a steady diet of jolts, beige book claims on thursday and a very small amount of feds speak, williams tonight, speaking in it reno, nevada, and erik rosengrand, coming on friday. The ism services coming up, after manufacturing showed the constratraction in august, here rick santeli in the cme. Reporter reed wrong is expecting a number in the mid50s, around 55. Labor Market Conditions index, here we go, 51. 4, 51. 4 is our nonmanufacturing ism august read. As i pointed out that is definitely under the 55 we were looking for, and if you want to know the last time we had a 51. 4, its been a while, actually. We have to go back quite a ways to find a lower number ciphering, i have to go back to february of 2010 to find a number that low. And lets look at some components shall we . New orders dropped dramatically from 60. 3 to 51. 4 and the employment index, considering the employment report slipped to 50. 7. We dont normally cover august labor Market Conditions index, fed favorite, but i have to for one reason, its minus. 07, that means the only number that isnt negative is the july read, which was upgraded from 1 to 1. 3. Every other read, so this is the eight, seven out of eight, are negative. This is rather significant, and we want to continue to highlight various aspects of the question in some of the offbeat indicators the fed looks at, especially looking at fridays number trying to assess whether it was good, bad, or ugly. Carl and the gang, back to you. Wow, Rick Santelli in chicago, thank you. That and the cooling august jobs number, dimming chances the federal raise Interest Rates in september at least. Our mike santoli has been watching that. Good morning. Hi, carl. The jobs report on friday did appropriately cool the idea september was going to be a time the fed was going to move but im arguing today in a piece, the markets because theyve been so revilsilient and strong are daring the fed to look for an opportunity to go. If we look where we were today than december, you have stock prices than about 9 higher, credit markets much more compressed than in december, also by the way in september of last year when a lot of people thought the fed should move and v volatility, the fed is very much looking for when the markets and the data cooperate to allow them to move. On the other hand whats pushing against this idea . For one thing, the markets dont expect a september move. The fed is probably going to want the Market Expectations to rise in the advance off the fed hike, and would take a lot of aggressive spin to get that done before the september meeting. It has been flat because of global influences largely and that industrial is sputtering. You have don flikticonflicting the early or late cycle. We have the catch 22 almost here where the markets might be strong because they dont think the fed is going to be anything eminently and the fed wants to see the markets in a robust state before they feel as if they have clearance to act. This is why its pretty much delega delegate in a narrow window the fed is looking to work its way through for yearend. There are a lot of people parsing this gold man note talking about the fact it raised its chances for a september hike to 55 , sort of parsing that fed speak on in light of recent data, sort of saying in the face of relatively weak data, well feel the need to go any way, what do you make of that . Thats interesting, kayla. Putting a lot of weight on janet yellence ye yellens comments, essentially saying theyre trying to signal a little bit of urgency to move as long as the Economic Trend more or less remains in place and thats why i think fridays jobs number was almost perfectly suited to not change anybodys mind. It was too weak to say the feds hand is going to be forced but Stanley Fischer says more than 100,000 jobs a month is perfectly sufficient to ratify the trend. I think thats why we have a little bit of suspense out there and you have some forecasters like those at goldman saying you cannot rule out september. All right, mike were going to see. Thank you very much, mike santo lirk li, from the nyc. And companies from a page ofspectors are announcing deals. Where should you focus your attention . Guys, good morning to both of you. Good morning. Sterling, 1. 34, twomonth high, what do you make of this . I think the catch 22, which mr. Santoli referred to is the one is done, i think in terms of optics, the fed is less desirous to move, thats somewhat obvious, but the data doesnt force the feds hand and they need to assess where they are and you need to put this in a global context. Youve got germany and japan negative, so that limits options. Data doesnt look recessionrece, but it is nice were getting back to jobs numbers equivalent to a 0 rate. I think the feds going to, probably in the last of convincing data will probably take a little bit more time rather than a little bit less. Its the kind of thing if you were to move your yearend target, it would be higher, not lower . The u. S. , equities based . Weve been you looking where we would sell the rallies. The economic race cycle, we dont know if its changed since last september, but i think the valuation argument in the United States becomes increasingly stretched inch by inch, or yard by yard, so a valuation perspective is dominating a lot of the announcements were doing. Jack, you go along with that . Yeah, for the most part. I like mikes comment. He said the market is challenging the fed to raise Interest Rates. I think probably one and done is the best scenario for stocks and you know as ive mentioned to clients as long as the Central Banks dont think were in a bubblel, i suppose were not in a bubble for right now and given weve got so much stimulus abroad, its the tenyear rate that s p and other valuation metrics care about, and my sense is the fed can go one and done here and the tenure rate probably stays where it is. Jack, are we at the point where stocks and bonds are going to begin to diverge because theyve been moving in tandem for so long, despite the fact that economic fundamentals have been choppy, at best . You know, youve got Central Banks all over the world flapping their arms, hoping to use Interest Rates to try to stimulate the economy, and it doesnt seem to be working. Now theres talk that ecb may take that next step and thats starting to buy equities, perhaps thats another move, but again, thats more of a wealtheffect scenario and its really the next step and were probably going to see it in japan first and thats this helicopter money. We believe were going to see it in japan. Japan may get some favorable result out of it, and that could influence the fed to try Something Like that here at home. Although i did see a headline this morning, an advisor to abe, saying that the doj should wait a little bit. Wait a minute. A little game of chicken going on there. You bring up a good point. We need to look at multiassets and needs to be global. What were looking at in the valuation argument is rather significant. The European Central bank is a good point. The bank of japan are beginning these cycles and you realize how thing european and japanese markets are relative to the United States, how deep and healthy, theres not a lot to be purchased in europe, relative to the u. S. Theyre going to have to get creative, for an extended period of time to many investors could be the good news you can get out of the bad headlines. Is it easy your for them to buy equities or Corporate Bonds . In europe that might be 6 and 1 2 of the other of the theyve got to create marketings and securities that can be stimulated from a monetary standpoint. The beginning of this process, creates an opportunity for investors. Do you think brexit will end up beingrecessionary . I dont. What were seeing now as you mentioned earlier, the pound is rallying back a little bit. Were seeing that this isnt the toilets swirl that a lot of pundits talked about, so now germany is rebuffing their establishment, france certainly, so well i think were going to see more of this nationalist movement in europe and thats probably why were not going to be able to see helicopter money in that part of the world. I think toilet swirl wins though in terms of financial jargon. Thats jay marioti. He was talking about the cubs, from the sun times. Thank you very much, guys, good to see you. Thank you. A good deal of m and a news, a lot of mergers, acquisitions, and continued advancement between monsanto and bayer as they get closer to a deal, this began last spring when bayer made its interest in monsanto known with a 122 bid rejected, moved to 125, the latest, 12750, made public there, and confirmed by both companies as is the desire of german reg laulators, early its of the uk in statements theyve not otherwise made. The two companies are moving closer to a potential deal that could come as soon as lets call it the next week or two. Monsanto has apparently told bayer it is getting close on price. 127,50 may not be there, but it appears they are not far. They are also working on socalled deal protections, given the antitrust scrutiny that such a transaction would bring on and the concern perhaps that it would be blocked by regulators either here or even perhaps more so in the eu, unclear whether that will be the case but both companies are set to be fairly close in terms of the overlaps and the dive divestitures of what needs to be done and the other protections would be. At this point, people tell me a lot of Due Diligence has been conducted by bayer and that numerous drafts of merger agreements have actually passed between the two parties, that is typical when you are nearing a deal. Nothing says however they are going to get done with certainty, but they are making progress, guys, towards that potential linkup of 65plus billion dollar transaction bringing pebrin bringing pesticides with all of those seeds at monsanto, and that deal with china buying sengenta, and theli linkup betwn dow and dupont, bringing those two companies eventually splitting off into its own company once that has concluded. Its been a busier industry than expected this year. Thank you, david faber. Donald trump weighing in on the Interest Rate debate, well hear from dallas fed president , Richard Fisher straight ahead. Youre watching squawk on the street. Stay tuned. From rochester to frthe hudson valley,buffalo, from albany to utica, Creative Business incentives, infrastructure investment, university partnerships, and the lowestxes in ds are creating a stronger economy and e right environment in new york state r business tthrive. Let us help grow your companys tomorrow today at business. Ny. Gov perience the thrill of the lexus is f sport. Because the ultimateexpre, this is the pursuit of perfection. For the First Time Since 1964, when goldwater was the standard bearer, the Dallas Morning News will not endorse donald trump for president , saying donald trump is no republican adding hes quote not qualified to serve as president and does not deserve your vote. Were joined by trump supporter and chief strategist, and michael barns who served as a political advisor in the george w. Bush administration. Good morning to you both. Good morning. All that said, this cnn poll essentially calls a dead heat this morning regarding likely voters. How will this final stretch going to shape up . I think its shaping up very well for mr. Trump, just a lot of the fundamentals lineup for him. Were seeing a struggling economy, people that really want to shake things up, were seeing antiinsider sentiment across the country and were seeing some real key issues breaking his way in swing states like ohio. The war on coal will swing southeast for trump in ohio in a big way. Trust supporters need to be very optimist optimistic. What does it say some of these polls have tightened in the last two weeks . Two things really, trump is flipflopping on his issues, saying what every it takes to meet the mainstreams like myself and the independents and Hillary Clinton has abandoned the messaging to the convention, which did appeal in a very proamerican way. This reflects trump is not effectively espousing any values that reflect our Core Principles of economic strength, as well as the rule of law. Hes proposed hes going to change his position on Interest Rates and messing the fact that we do not have full employentme that we need to balance the budget and reduce the national debt. None of this is coming out and hes saying whatever to appeal to the group that otherwise has been opposed to him and hes not reflecting any Core Principles of americans at large. Perhaps that michael, thats why weve seen in some battleground states like pennsylvania, wisconsin, michigan, trump has a slight lead whereas in republican strong holds like georgia and arizona, that vote is more or less up for grabs now. Wouldnt you say theres been a fair evening out throughout the parties . There has been and its because of trumps flipflops, that hes trying to say things appealing to that farright nativist base that really has been his strong supporters from the primary season, but now hes starting to flipflop on those issues and appealing to more main street moderate republicans and independents who hear what they want to hear because as we heard from jesse, this is a strong desire for change and some people are willing to risk the change of donald trump rather than vote for Hillary Clinton, but the fact of the matter is, Hillary Clinton did a great job in the convention and at discussing and showcasing her ability to bring about change, but has abandoned that. The reality is we cant risk the change that trump brings to the United States by his desire only to pursue his own wealth, as well as perhaps his power grabs. And thats coming from a gop strategist even, so jesse, do you think the net effect of that flipflopping will be neutral . Do you think theres enough of a vote that is still undecided that this home stretch willing meaningful . I just dont see these flipflops everybody keeps talking about. The fundamental at the end of the day, donald trump is always run a Strong National defense, strong borders and strong economics and that hasnt changed and wont change. Our trade partners is Strong National defense or strong on economics, they threaten our economic security, as well as our national security, thats just one of the many areas in which he does not espouse the values of republicans or americans. Enough americans out there are fed up with the way the Foreign Affairs are going and they think we need a little better crack in the world. Enough senseless wars and bad trade deals. Trumps going to shake some deals up. Its too big of a risk to take. These going to shake things up it destabilizes the United States and our core institutions and values. The current policys doing a real good job keeping things stable in the middle east. Certainly those policies will solidifiy into some of these debates. Well talk as we head into the final stretch of the political season. Congress is getting back to work after a sevenweek recess. Were joined with a look at what is on the agenda, amen. Hi, david. Start with some numbers for contest. Weve got this survey, monkey pole out that gives you a sense of the overall drama thats going to shape the congressional session. Its clinton, 48 , trump, 42 . Thats the context for the congressional session. Congress is back in session today. A couple other numbers for you, 43 and 33, those are the numbers the house and senate will have for the rest of the year in session. Even those days youve got to divide that into prea and post election layingduck session. Almost nothing will happen given the overhang of that president ial campaign, the tightness of the race were starting to see. If you look on the agenda, theres one really big mustdo item between now and october 1st and thats pass Appropriations Bills or continuing regulations the government doesnt shut down. Look at the things they could do if they decide to do them, some hearings on Mylan Pharmaceuticals is a possibility. Weve seen a number of congress, both parties expressing interest in the epipen price hikes, thats one we could see in the fall. Zika funding is a fight thats going on it start today. Thats been held up over a side battle over plan plan, but that is one we could see worked in to this overall spending battle and a couple other points. The merit garland nomination, thats something to watch for as a possibility in the layingduck session if Hillary Clinton were to win, there might be a scenario, whereby republicans and folks on capitol hill conclude its the time to do that Supreme Court nomination, and tpp, the president will make a push for the Transpacific Partnership deal because both parties are campaigning against it, that makes it very tough for capitol hill do anything, even though this president still in office for the next couple months supports it, guys. Yeah, few more months until january, eamon thank you, from washington. Donald trump speaking of the president ial election, taking a swipe at the Federal Reserve and the obama administration, acuting the fed of creating a false economy and saying Interest Rates should change but that is quite a different tact from what he told our colleges on squawk box back in may, take a listen. If we start raising rates ive a always been a lowInterest Rate person. If inflation starts coming in and we dont see any signs of that, but inflation starts coming in, thats a different story, then you have to go up and slow things down, but right now, im for low Interest Rates and i think we keep them low and we have to compete. Theyre keeping the rates artificially low so the economy doesnt go down so obama can say he did a good job. We have a false economy, everyone understands that, but its a false economy. The only reason rates are low so he can leave office and say, see, i told you, but at some point, the rates will have to change. Joining us on the phone is former dallas fed, Richard Fisher, but has talked about the need to raise rates a few more times. Whats your take on trumps comments . I think hes right in that weve have an artificial stock market and as a real estate operator, cap rates are generally speaking, motivated by free and cheap money and is politically shrewd. I was part of that hated body for a long period of time. I dont think he is spot on at all in terms of accusing janet yellen of being politically orrien oriented or trying to help the obama administration. One of them gave money to the clinton campaign. Ive not seen that in my tenure at the fed and i think thats fed a lot of suspicion, but his general principle, if you listen to that interview carefully, to be fair to him even though im not a supporter, he answered the questions fairly. The question is doing fairly well, but markets have been distorted by low Interest Rates in cap rates and the real estate market. And youve been frankly youve been talking about this for sometime i remember interviews in the past where youve talked specifically about stock markets not just here, but around the world. What about a false economy. Yep . In a i dont know what that means, but the one thing i dont either. The one thing that is true when you have low Interest Rate, it hurts consumers because they have to save more and exacerbates the disparity between the wealthy and the middleincome groups, so savers have been penalized. This was a decision we made overtly at the fed which was to create a wealth effect, by turning the markets like we did in 2009, and the savers have been hammered and the fed is not very popular. I hope he doesnt pick up on it again. I think wed need to keep it independent much that as he himself has said in the early spring but well see. What would a september rate hike do to change his stance . Would he have to then argue i dont think it the economy strengthening . If anything, i would dig in my heels just because of his comments, but i happen to feel that the economy is Strong Enough to withstand a rate hike, it will be good if it doesnt happen now, at least happen in december. It wont happen november 1st or 2nd, thats too close to the election itself, but we have to restore the ability to favors to make money on their savings and make money on angst, on commercial banks to restore interest markets and refer to Interest Companies and the obligation theyve made to people. These are institutions middleincome groups have been dependent on. Who are you supporting or you have discussed that yet . I am supporting i dont know, alfred e. Newman. I dont think i have much of a choice here. I think its a choice between quick sand and a bullet to the head. Which is what . Im not going to tell you. You guess for yourself. Careful, well drive you further into that corner all morning long. Richard, thank you very much, though, for the candid comments about the economy and certainly how its going to relate to the race. Okay, god bless you, thank you. All right. As we head to break, take a look at where stocks are trading at this hour. Fractionally negative across the board for the major averages. Squawk on the street will be right back. Ghby our customers. Whos with me . Im in. Im in. Im in. Im in. One, two, waitwait. It wheres tina . Doing the hand thing . Yep allydo it right. Take a look at shares of amazon, this is an alltime high this morning, 778, back to may of 1997, one of about 30 or so 52week highs but some of the alltime highs include amazon, tyson foods and aon barnes and noble up 8 this morning. Getting a mention by baron saying amazon is going to kill barnes and noble is unfounded, coupled by a stud we pew saying 65 of americans have read a printed book in the last year. When we return alarmingly low. 65 . Yeah. I think thats still pretty high, all things considered. When we come back, apples big e gent, the tech giant getting ready to unveil its newest products tomorrow, and a look at where stocks are trading after the long weekend, fractionally lower, squawk on the street comes right back. 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Built for business. Good morning, everyone, im sue herera, heres your cnbc news update at this hour. President Obama Meeting with his luation counterpart, the first sitting president to visit the Southeast Asian nation and vowed to work with the United Nations to tighten sanctions against north korea after their latest missile launch. Were going to work diligently together with the most recent un sanctions that are already placing north korea under the most intense sanctions ever. Were going to Work Together to make sure that were closing loopholes and making them even more effective. This after north korean released a video showing allegedly firing a missile off the coast that traveling about 620 miles into the exclusive Economic Zone in the sea of japan. Fox news reached a 20 million settlement against the roger ales and is expected to make a public apology. And after an unspecified problems hindered the check in system, in san francisco, passengers waited more than two hours. That is the news update this hour, kayla, ill send it back downtown to you. Thank you so much, sue herera. Meanwhile, apple is planning introduce new versions of its flag ship smart phone tomorrow. There are a lot of rumors around the event, the most controversial, apple removing the head phone jack. Will all of these be enough to spur new iphone sales . Lets bring in Senior Technology analyst, is this going to be lucky number seven for apple . We sure hope so. I do think the best thing apple has in its favor right now is the extremely tempered expectations people have on the iphone 7. Everybodys talking about the 7 s already, so given the tempered expectation, to the expect you have great evolution, waterproof features, we do think you get a better upgrade than what people are apprehensive about. Should be a positive from the stock from here. Andy, you call yourself the worlds most anticipated dongle, referring to customers if they want to use their head phones with these new iphones is that going to be a deterrent, or will they be glad to have an updated product . Well, to some extent, i think theyll be glad to have an updated product, a pretty good amount of volume these days comes from replacements and those are effectively phones that dont work or people that just want the new thing and those people will continue to want to get a new phone regardless of whether or not theyre old headphones plug directly in. Andy, theres some sense those replacement customers have been waiting a couple of years and thats why the 6s wasnt as block buster a product as the streets had expected. Any proof those customers will be upgrading to the iphone 7 . Theyre not going to keep waiting . We dont have proof. We just have a long history thats what should happen, certainly we and a lot of other people expect the Holding Periods to begin to extend, but through this coming cycle youre going to have a whole lot of people that bought iphone 6s, thatll have phones 2 and a half plus years old and those people, you know, are more likely than not to upgrade. Something wait, but certainly more will upgrade than what we saw in the 6s side. Amit, looking at the expectations for the new iphone 7, you have a new color, you have a dual camera, increased entrylevel storage. Which do you think will be the biggest selling point to people looking for a new phone . You know, i think the biggest thing youre going to get out of this personally is a better battery life. Its been the biggest feature Everyone Wants out of the iphones. Its better battery life and you get that with this one. More memory is always a positive, the fact you get more for less, would be a nice positive, as well. I think those two levers, better memory, better battery life, are two the biggest, or more attractive features of the iphone 7. So amit, you talked about the lower expectations for this product, but then were getting reports that apple has actually increased by 10 what it needs from suppliers to meet expected demand. Is that a positive sign . On the face, yes, it is. Apple always likes to supply chain to jump as high as they can. You have a lot of yield issues if you remember with the 6 plus and the 6s plus. Maybe they want a big supply in case demand shows up. Our take, youre looking at flattish iphone numbers. And apple has an extra week which will be a help for them, as well. Andand theprodu andy, this p coming slightly earlier than product events in years past. Will that help the Third Quarter numbers . Yeah, theres that extra week in september and probabdecember quarter. Well have ten days of selling rather than just a few days and that certainly should help the numbers. Andy are we not going to be talking about this tax ruling from europe in do you think thats largely on hold . I think so. On an absolute scale, the numbers arent that big for apple and its going to be tied up most likely in court for knight a long time through the appeals process. So, i think for investors were focused on the things that generate a multiple, and thats mostly the iphone. And of course the bulk of those repeatable earnings comes from the iphone so well see what we get tomorrow. Andy hardcrest, and ami amit dahryana, thing. As we take a break, look at navistar, and volkswagen, after announcing its buying nearly 17 in the truck maker for 256 million and will take two board seats. Well talk about that and a lot more from squawk on the street continues. Elping people everywhere do what they do. Better. I work with startups like alpha modus to predict markets five times more accurately. I am helping tv networks use social data to predict what people want to watch. And i worked with marchesa to turn fan feeds into a dress that thinks. Hello, my name is watson. Working together, we can outthink anything. Hello, my name is watson. Mary buys a little lamb. One of millions of orders on this companys servers. Accessible by thousands of suppliers and employees globally. But with Cyber Threats on the rise, marys data could be under attack. With the help of at t, and security that senses and mitigates Cyber Threats, their Critical Data is safer than ever. Giving them the agility to be open secure. Because no one knows like at t. After badly under performing most of the market, beck shire hathaway, is it time to trade on buffet again . More squawk on the street coming up. [phone buzzing] some things are simply impossible to ignore. The strikingly designed lexus nx turbo and hybrid. The suv that dares to go beyond utility. This is the pursuit of perfection. Welcome back. Lets get to the cme group with Rick Santelli and the santelli exchange. Rick. Good morning and thank you. Id like to welcome my special, always says it straight, yra harris. First of all, lowest level in what, six and a half years for ism, service, nonmanufacturing. You said you hit the buy button for twos. Look like they hit the buy button for just about everything. Especially for the twos because the twos are being priced off the live board, which is being priced as the circle goes round and round, and priced off the reregs, so nobody knows so it obviously has fed implications, 78 at 74, and also close to 160, and tens were 155, so its part the fed and part what says it about the economy, the new normal has a range, manipulate the top of the range is 2 economy, and maybe the bottom of the range is 1 1 2. The batdata points are so confusing. Theyre murky. We got the services number, which was weak. For everybody who didnt worry about the manufacturing number, were a service economy. Now what are we today . The fed has painted themselves and more important than i would argue theyre paying themselves in the corner and their feature super glued to the floor. Janet yellen, thats her most important down you know what amnesia is, right . Why is it everybody who discusses the market gets amnesia . We can argue about whos qualified off the rails and who isnt. He said its a false economy, my god, everybody said that. Everybodys been talking about it for years. I think a false economy is when the stock market is virtually making new highs and the rest of the economy isnt. Whats so hard to snurunder . The fed has broken the signaling mechanism uof the bon market. You can say okay. But theyre continuing. There are no signaling mechanisms. Capitalism needs the signaling mechanisms to be able those are the feds by the very nature. Look at every speeds, the economys humming along but by reading the tea leaves of what they say, its living proof that its a false economy, because if things were nearly as good as most of the things they write about, we would have had a rate much closer to 1. 25, 1. 50 already. Whats false with donald trump, certainly not going to put words in his mouth, ill get arrested, but what hes talking about is that the valuation of the stock market is false. Thats what he i think he means. He must have had a drink over the weekend to come out with that and thats the other thing, too and the other thing, how many times in 2011, 2012, the fed needs to be discussed in the political arena, they have to be above the radar screen and do you know what, whether you like donald trump or you dont like trump, i think its very important to discuss what is probably the most powerfulentity in our government right now. Its not just the fed. Its all the Central Banks. We had a g20 meeting this weekend. That was a joke. Ive seen better weddings with better photo opportunities. They discussed there were stresses and in fact i would argue the chinese, excuse me, [ bleep ] snapped the United States. They jointly agreed with the United States not to be a currency manipulator, therefore they put themselves on the same level as the United States, that was a big defeat for the United States politically. No matter how you slice it, i would continue to monitor what the markets saying today and that is no fed in the foreseeable future, final comment . They would i think theyd be the only thing that and they picked up, i want to see how Stanley Fischer votes. If this is nine to one, i say Stanley Fischer resigned yesterday. How i can say anything beyond that. Thank you. David, back to you. Thank you very much, mr. Santelli. Cnbcs annual delivering alpha conference, kate kelly joins us for the report of august Hedge Fund Winners and losers. Hedge Fund Performance showed a big diskrecrepancy, and up 15 after a good august, trion partners up 6. 5 , and david and einhorn up respectively, through the markets so at least theyre in line with that. Citadel, which just turned into the black midmonth in august, and of course pershing square, whos last holding in valiant gave it a beating all year and certainly continuing although august was a i bbit better for them. Against the back drop, constitutional investors have pulled tens of billions with the Second Quarter marking the third consecutive one of outflows. Cio of new mexicos hedge fund, which reduced its exposure by about a billion dollars, says the multiinduststrat hedge fun problematic. Some have referred those as alternatives. We tend to call them liquid strategies, and multistrategy hedge funds in many cases help you leg into or build an exposure to what may be a different type of asset category and in term you delegate much of the the asid allocation decision, the apportionment to a money manager. And rebol actually remanaged his strategy, so equity hedge funds overall, which david is a more measurable way to pay it, because youre looking at indices or Corporate Bonds and putting it against a hedge fund that does multiple things. Yeah, interesting to look at that august performance, kate, the stock pickers at least coming back a bit, but renaissance, the machines still rule the day dont they . Theyre killing it, absolutely. Theyve had a really good year, i believe they had a really good last year. I dont have those numbers in front of me but theyve had a really nice run and obviously its doing well for owners and participates who have been politically active, as well, so a lot of interesting details out of renaissance these days. The mercers on one one side. And brown, ceo, dont forget about him. Kate kelly, and catch the sixth annual delivering of the alpha conference next tuesday. Details, tickets, you want them . Good, head over to deliveringalpha. Com. When we come back on squawk on the street, her mean puttmi a dent in Holiday Travel straight ahead and our new episode of beninge is streami nought with his long time partner. Binge is where you can find it on our site, hulu, and apple tv, youre watching squawk on the street. Great time for a shiny floor wax, no . Not if you just put the finishing touches on your latest masterpiece. Timings important. Comcast business knows that. Thats why you can schedule an installation at a time that works for you. Even late at night, or on the weekend, if thats what you need. Because you have enough to worry about. I did not see that coming. Dont deal with disruptions. Get Better Internet installed on your schedule. Comcast business. Built for business. And many beach closures over the labor day weekend. How did the Airlines Fare . And how is the rest of 2016 looking . Joins us is a travel industry veteran. Henry, great to have you. Thank you. What are the metrics you would use to measure the disruption. I looked at cancellation and delays. There werent too many of them. There were only a handful of cancellation and delays. So i think from that standpoint not many were disrupted. A lot of the airlines had been ahead of time. So that may be because a lot of passengers took advantage of that . We wont know that until the Airlines Report it, but in talking to the airlines yesterday, they were giving me the sense things were pretty good. The Industry Group air loons for america forecast that the u. S. Carriers would carry 3. 8 more passengers. Theyll probably come close to it, maybe a slight miss over labor day. The storm got downgraded early on. But it stuck around for longer. The hotels will probably feel the pinch more, but hotels especially beach resorts in new jersey will feel it, and some felt it like the carolinas. Fares are down about 6 because of the growth of the ultralowcost airlines like spirit and frontier. There more to run on this one, do you think . What im looking at is not just the faerz, but the optional products the Airlines Sell us. The bag fees, seat assignment fees, thats where the airlines are making their money. They have Profit Margins anywhere from 50 to 80 , so very high margin product for them to sell. Are you getting the sensist easier for small operations to go to the desert, lease a few planes and start to disrupt profitable routes . Theyre aquick for the news part new airbus airplanes. 4. Holiday travel, and a lot of people star thinking about capitalizing on the best price. So youre going to start to see the airlines put on the sales. They already have to stimulate trouble and in the next couple weeks well get a sense of how theyll do. Right now were in the peak period, so i think Business Travel will be at or slightly below where are the promotions taking place. There is some great deals going and controlling the north atlantaic. But fran is a great deal, italy has good values and the uk. Domestically youre starting to see really good prices almost everywhere, because Budget Airlines have spread nationally. Theyre the ones setting the prices, and the big guys follow suit. Any of the airlines you think are poised to benefit the most . They tend to late the big three in pricing, so watch delta, and american and united will follow. Henry, we appreciate your time. My pleasure. Henryhartfelt. Fox settles the suit with Gretchen Carlson for 20 million. Sarah ellison broke that story. She will join us at 11 30 eastern. We have a lot more ahead. Remember here at ally, nothing stops us from doing right by our customers. Whos with me . Im in. Im in. Im in. Im in. One, two, wait, wait. Wait wheres tina . Doing the hand thing . Yep we are all in for our customers. Ally. Do it right. We are all in for our customers. Its not just a car. Its your daily retreat. Go ahead, spoil yourself. The es and es hybrid. This is the pursuit of perfection. Good morning. Squawk alley is live. Welcome to squawk alley for a tuesday. I hope you had a great summer and long weekend. Im Carl Quintanilla along with Kayla Tausche and jon fortt. Guys, good morning. Apple is set to lift the curtain on its latest lineups. This as the companys reportedly boosting part orders for the newest iphone 7 in anticipation of higher than expected demand. Jon, lets start with you on this one. Can we read this tea leaf accurately . I think we can. Im worried, carl. If the headphone port is removed as we expect, this is apples most controversial Design Change ever, and i say that because yes, they have removed floppy drives. Yes, they have re