markets. up and down. but right now if you look at what we've seen happen over the last month it has been impressive >> somebody this week was talking about 1938 in a different context. i can't remember what it was not -- >> political context >> in a fed or some type of -- economic context >> yeah. >> yeah. so that's quite awhile may wasn't so great. >> may was terrible. that set you up for june all three major indices are having their best month since january of this year triple digit gains as we head into the g20 meeting this weekend with so many people watching what will happen between china and the united states look at what happened overnight in the asian markets you will see the nikkei was down by 0.3%. same thing with the hang seng. shanghai was weaker. down by 0.6% then this morning in europe, where there is some active trading taking place right now, green arrows across the board at this moment. biggest gainer is the dax, which is up by 0.4%. everybody is up by 0.2% or more. look at treasury yields this morning. the ten-year yield right now sitting at 2.019%. apple's chief design officer, jony ive, leaving the company to start his own design company. he was the chief architect behind dozens of apple innovations starting with the imac back in 1998 after steve jobs didn't return he was instrumental in the ipod, the iphone, the ipad, the apple watch, he designed apple's new headquarters, apple park as well the new design business will be called love from sounds like -- one of those british movies >> "love actually. >> he said he would still be involved with apple for years to come but this seemed like a natural and gentle time to make this change. stock down about 1%. >> down about 2% >> i was sentimental hearing this >> he played a huge role in terms of how everything has looked, including the software the last couple of years at the same time i think his role -- it sounds like in the past couple of years his focus has been on the park, so many other things >> he didn't have anything to do for a while. >> less of that. >> i thought, look, these are transitions in life that everyone makes >> how much money does he have >> hundreds of millions. >> not a billion >> he may. he may >> that would keep you in the game i don't have a billion yet -- >> no, it would explain -- maybe. i'm trying to figure out why do you necessarily have to go -- >> he loves it >> he probably still loves it. i think he'll have more to do if it's not just apple anymore. apple is a mature company. he's not going to produce and direct movies. he won't design -- >> apple will be key >> the self-driving cars -- >> the cars, he could be designing the cars >> by the way, he is still going to be having apple as a top client >> right >> he can still do the work with, but also take on other projects i think everybody after a while looks around and says what do i do next. >> theest th est theaesthetics - >> that's steve jobs >> i think a lot is his. >> no buttons. clean, clear >> i read it i thought he designed -- this is like 4 1/2 inches. see, it doesn't seem hard to design this phone. you mean what's in the phone >> no, the sleekness >> the software. >> the way it all comes together nobody does it better. nobody does it better. >> this is jony ive. >> jony ive. >> jony ive. >> i got it. >> by the way, the other piece of this is interesting, jony leaves, angela left earlier. iovine came and when >> some of them -- jony ive has been there 30 years. there are people who will ask questions. >> i don't think you can understate or -- i don't think we should understate the idea that he is still geg to be working with apple he'll still have a hand in it. >> i think there's a big difference between being at the monday morning meeting and overseeing all of the designers and being able to implement your own aesthetic and then being a consultant to the company. we'll talk more about this this morning. >> apple can make some big moves, too 1% -- >> could be the trade talks. >> but if it was -- if his influence is what it would have been five, ten years ago, it would be more than 1%. it's waned at this point >> that's fair >> it's -- >> we'll talk more about this. we have dan primack coming up from axios as we know, president trump is in japan meeting with world leaders at the g20 in osaka. and then later today he will sit down with president xi jinping to talk about a potential end to the trade war. everything is swirling around, you know, they're going to ask for this, but we may do this all the stuff that we thought we knew, i'm not sure we know anything necessarily we'll know within 24 hours mayb maybe. >> no one can predict what will happen behind closed doors a lot of the hot topics that will come up in that one-on-one meeting tomorrow have already been raised in larger forums at the g20 today. take huawei. that was raised by president trump in a bilateral with india's prime minister today, broader china trade issues came up with chancellor merkel. then a meeting between all 20 leaders on the digital economy economy featured 5g with president xi standing by looking on as part of that broader discussion here's the viewpoint from china regarding where things stand with regard to trade talks it was tweeted that because of political headwinds the u.s. will back down eventually. hard line policy has had the upper hand in china. when reporters asked president trump earlier today about whether he would make a deal with xi, this was right ahead of a bilateral with brazil's president who accused xi of buying up his country, here's what president trump said. >> we'll have a meeting with president xi of china tomorrow as you probably have heard seems to be a rumor about that we are, indeed we look forward to it. it will be productive. who knows. i think it will be productive. at a minimum it will be productive we'll see what happens >> so far delegates say there's been little progress on the official agenda of stabilizing growth and easing trade tensions but it does appear that president trump's travel calendar could be filling up he accepted an invitation from bolsonaro to go to brazil and there's no word on whether he accepted an invitation from president putin. >> kayla tausche, thanks if you hear anything for sure before any of this happens, you'll come on, right? we have time for you we do have ribs later. >> we'll see you i'm pretty sure every hour with a little bit more information each time >> all right thanks speaking of the g20, check out president trump's reaction when asked by a reporter about russian meddling in u.s. election elections. >> don't meddle in the elections. >> separately vladimir putin gave an interview to the ft in which he said the dominant western ideology since the end of world war ii has become obsolete he said the liberal ideal has come into conflict with the interests of the overwhelming majority of the population putin praised president trump for trying to stop the flow of migrants and drugs from mexico all right. we're also watching nike shar the strong dropped 4% before rebounding nike earned 62 cents a share in the fourth quarter 4 cents below expectations revenue was slightly above on the call nike's cfo said the trade war with china has not affected business so far nike continues to see strong momentum and consumer demand in china. he sa the potential tariff impact on nike is modest also we should mention boeing 737 max now expected to stay grounded until late this year company official saying it will take until september to fix a new software flaw that was discovered in simulator tests last week. that means the plane is not likely to resume flying until october or later as the faa must review the fix and the results of a certification test flight. southwest airlines has said it needs 30 days after the faa signs off before it can resume flights. boeing shares are off marginally so now we're looking at october, but does this extend out maybe into next year coming up, the bank stocks we'll tell you about dividend hikes and buyback plans after the latest round of fed stress tests, that's coming up next as we go to break, the biggest premarket winners and losers in the dow. you should be mad at airports. excuse me, where is gate 87? you should be mad at non-seasoned travelers. and they took my toothpaste away. and you should be mad at people who take unnecessary risks. how dare you, he's my emotional support snake. but you're not mad, because you have e*trade, whose tech helps you understand the risk and reward potential on an options trade it's a paste. it's not liquid or a gel. and even explore what-if scenarios. where's gate 87? don't get mad. get e*trade and start trading today. has been excellent. they really appreciate the military family and it really shows. with all that usaa offers why go with anybody else? we know their rates are good, we know that they're always going to take care of us. it was an instant savings and i should have changed a long time ago. it was funny because when we would call another insurance company, hey would say "oh we can't beat usaa" we're the webber family. we're the tenney's we're the hayles, and we're usaa members for life. ♪ get your usaa auto insurance quote today. the u.s. division of credit suisse was the only bank tripped up by the fed's stress test. they have until october 2th to fix problems in their capital planning process u.s. trading shares are lower this morning other big banks are showering investors with fatter dividends and share repurchases after passing that stress test look at goldman sachs boosting its dividend by 50% to $1.25 per share and authorizing a $7 billion buyback. jpmorgan raising its dividend by 13% to 90 cents per share, also rea authorizing repurchases. citi grooup and morgan stanley raising dif depositividends by 6 cents. futures impacted by some of this you may be getting a bump in your open shares there let's talk about it. how far does this go is this a up with-time operation? >> i think this is a long sustained move if you look at the dividend payout of financials, it's way below trend. that's why we've been bullish on banks and sifis, they have been so regulated, they have not been allowed to do anything with capital, and only now have we seen that cash return potential unleashed. little known fact, when you see the payout rash ytio of banks normalize, the price to book multiple generally doubles there's a huge runway here in terms of the multiple that invetsz i investors will be willing to pay for banks. >> what kind of meaningful multiple do you expect 12 months from now what re-rate hag to happing has where investors say this is different now. >> don't think we ever go back to that growth and leverage story but the multiple could increase by a half point >> a couple turns. >> yeah. if you look at financials, any used to be bought for quality and cash return prior to the 2 2000s, then they became a levered bet on housing i think as investors are looking for quality in yield and yield is scarce, it's nowhere to be found, why not pay a higher multiple for banks in >> question on the stress test >> yes >> how much of the success of -- or the passing grade was a function of the banks being so much stronger than they used to be how much was it you think the fed itself with the exception of credit suisse being loser? >> relaxing. >> yeah. >> i think it's both >> is the fed relaxing too much? >> i don't think so. >> some skeptics think we're going backwards. >> i think we're in a well-capitalized environment the thing i look at is the leverage ratio for the banks if you look at the leverage ratios it's been cut in half today from where it stood for like the last 40 years leverage -- >> rekeep being told financials are the place to it hasn't been the story for so long is this a turning point? >> i think financials will turn into a regulated utility i work at a bank it's becoming a regulated utility story. so we're not necessarily this great bet on fintech or growth, but i do think we're starting to see lower earnings volatility, higher payout ratios, more share buybacks when everybody else is slowing down share buybacks, financialals are financiala financials are amping it up. what >> what is your take on swcredit suisse >> i think u.s. banks are better than european banks. >> any comment on nike >> it was interesting to hear their commentary on the trade risk being small nobody has made any sort of noise about real pain being felt from that segment. there's been more positive than negative commentary on china sales exposure for consumer. i think the real pain point is technology, semiconductors, potentially industrial china consumer has not started to really show cracks. what we're watching is tourism i think where you might start to see a little bit of a hit to u.s. multinationals with a big luxury angle is if we see a slowdown in china tourism. >> we heard that already from some hotel operators >> we have from some luxury retailers as well but i think it's interesting that u.s. companies are not necessarily guiding down as much as we would expect on tariffs. >> brian cornell from target said they're able to manage it they have enough things going on they can counter it. >> maybe trade is a little red herring, but i think it's -- >> we're too focused >> it's taking up a lot of mind share and a lot of other stuff is going on. >> we shouldn't underplay there are areas that will get hit hard >> and they already have exactly. but i think the idea of looking with consternation at the s&p 500 and saying every stock with china exposure is going down, that's wrong that's where i think the opportunities are to buy cheaper stocks that are not necessarily hit. >> where do you think we'll be at the end of the year >> 2,900 is our target on the s&p 500. i think there's upside risk to that numberful we ran this analysis where we said if trade risk had not existed if you took out all the days where negative trade news disappointed the market, the s&p would be trading at around 3,100 today. that's bullish >> your gamble thereforeis that this trade war doesn't happen. it all gets involved >> i don't think it gets solved, that's why we're at 2,900 this trade war i don't think is about soybeans, it's more technology and security i don't know if those issues are solved overnight or over the weekend. i don't see this as a done deal. >> at 2,924 i don't know why anyone would -- it's only june why not stay in the market >> i think the market goes up and then down. that's our call. 3,100 could be the peak. >> so we could hit 3,100 but end the year at 2,900. >> you haven't learned yet -- >> point in time forecast. >> you have a bitcoin forecast >> unfortunately i don't >> it's great to see you >> great to see you. >> thanks for being here. coming up, hot ipos. we'll talk about the stellar debut for adaptive biotech yesterday and today's big ipo the realreal and later, winners and losers from the second night of democratic debates here's one of the highlights from senator kamala harris >> america does not want to witness a food fight they want to know how we'll put food on their table. yes? ♪ ♪ creating the perfect night... just takes a little creativity. the light beer you've been waiting for has arrived. lower carbs. lower calories. higher expectations. corona premier. right now it's time for the executive edge we're talking hot ipos check out this interview from "squawk box" yesterday >> our immune system has evolved over hundreds of millions of years in response to disease adaptive has created technologies that allows us to tap into this information, to read the genetics of the immune system to create clinical products to transform how we diagnose and treat disease >> that was just before the ipo yesterday. found some buyers. adaptive saw its stock surge in its public debut it gained 105% from the ipo price of $20 it's up another 3.7 price this morning. it is the second best debut this year behind beyond meat. those are the only two companies this year to double in the first day of trading. realreal is going public today on the nasdaq. leslie picker has more on the pricing. >> the products on this site may be used but the shares they're selling are brand-new. the realreal selling 3$300 million worth of stock at $20 each in its ipo. the deal values the realreal at 1$1.7 billion the company generates revenue by taking a cut when people sell their used rolexes, bags and rings on the site. the realreal was founded in 2011 by former pets.com ceo jewelry wainwright she was shopping with a friend at an upscale boutique that sold consignment and thought it was the perfect market to disrupt as long as each product was authenticated. that's the big question for online consignment how will these companies be able to present fakes or counter fit products from passing through the sites? the realreal says they have more than 100 highly trained gemologists, brand experts, art cu curators that review the items revolve has doubled from its start earlier this month and chewy also has gone up >> we had stockxx on yesterday they sell used sneeshgl used ne, high-end stuff still a stretch. some things i get, you buy a ring, a bag, art but shoes kind of grosses me out. you were saying your sister sells what >> her lululemon workout clothes on posh mark, she says they go like hot cakes it's not a thing where they sit for years and years. they get sold easily >> workout clothes >> bathing suits >> sell your underwear, so gross. >> we should look. >> myquestion about realreal, it continues to lose money 2018 lost $76 million in revenue of 207 million >> run rate of 100 million this year >> the real question is we had so many money-losing ipos, but if you look at slack it looks like it's clear when it could turn profitable. uber on the other end, less clear. is there clarity here on this stock? >> i'm not sure there is they have a take rate of 35%, meaning for each item sold on their site they get about 35% of that that they keep and take home that's a high margin for a consignment retailer the problem is there's so much competition that is coming into the site if you're already not profitable and you're seeing all of this competition latch on to this space, what happens to your take rate as soon as that competition lores their take rate? >> i'm open to offers. >> for your underwear? >> for my lululemon pants. >> you would think on a company like this, they have to be profitable >> i think you could get 50 bucks. >> 50 bucks? >> how much do they cost >> i'm a celebrity >> well, are you going sign them >> yeah. >> they could go for 150 >> they smell like him, too. >> i would consider washing them >> if you don't wash them, you might get 200. >> you could try >> don't know. a retail company that loses money in a world where retail loses money with a 1$1.7 billion valuation. >> 1.7 billion valuation >> seems problematic to me thank you. when we return, legoland going private. the new deal to buy its parent company just six years after its ipo and much more on the departure of jony ive from apple. the design guru leaving the iconic company but he's not going far. we have reaction from the west coast straight ahead as we head to break, a look at yesterday's s&p 500 winners and losers through the at&t network, edge-to-edge intelligence gives you the power to see every corner of your growing business. from finding out what's selling best... to managing your fleet... to collaborating remotely with your teams. giving you a nice big edge over your competition. that's the power of edge-to-edge intelligence. val, vern... i'm off to college and i'm not gonna be around... i'm worried about my parents' retirement. oh, don't worry. voya helps them to and through retirement... ...dealing with today's expenses... ...like college... ...while helping plan, invest and protect for the future. so they'll be okay... without me? um... and when we knock out this wall imagine the closet space? yes! oh hey, son. yeah, i think they'll be fine. voya. helping you to and through retirement. did you know i grew up here? i used to come here every saturday as a kid. do you still have family here? a lot of cousins. it's nice to be back. this is it - the company's new home. we'll finally have the space we need to keep expanding. all that work is definitely paying off. congratulations. thank you. at u.s. bank, we believe hard work works. and that's why we work hard together to help your business realize its full potential. ♪ ♪ well cowelcome back you're watching "squawk box" live from the nasdaq market site in times square good morning u.s. equity futures not quite triple digits on the dow they were earlier. they were up a little over 100, managing a 92-point gain nike pared losses. down just a bit. apple is dragging the dow down a bit. s&p up 8 the nasdaq indicated up 13 the danish family that controls lego is teaming up with blackstone and a canadian pension to buy the company that owns the legoland theme parks. merlin entertainments has agreed to be taken private for 6$6.1 billion. the dole coeal comes weeks afteu act urged the company to find a private buyer. merlin is the second biggest operator of visitor attractions globally, they also own madame tussauds and the london eye ferris wheel >> your favorite place >> i think about it, my legs get shaky. i wish they would do a "squawk box" wax thing >> you want to do a "squawk box" wax thing? >> it's treepcreepy >> the whole thing is creepy some people already think we are wax figures. >> it's nearby >> it's in sometimtimes square >> would you want to visit yourself if we have time, right >> speak for yourself. >> just to pose. how much time did we spend yesterday just posing? horrible >> posing and pouting. >> different story shooting stuff for down the road. when we come back, oh, you know why this song is important? because it was dave evans wedding song today is his 11th anniversary with his wife katie. he plays it every year on his anniversary as a tribute >> i'm all for it as long as it's not friday i'm in love. coming up, we'll talk about apple's transformation during ive's time with the giant. as we head to break, a look at the premarket winners and losers in the s&p the winners are all financials that's the best performing sector this quarter so far two of them, the big dow components, jpmorgan and goldman sachs also helping you're watching "squawk box" on cnbc welcome back to "squawk box. jony ive is leaving apple. josh lipton has more reaction from the west coast. good morning >> good morning. his departure comes at a critical time for the country. look at apple's last earnings report iphone revenue dropped 17% even as services surged 16% new services were on the way from original programming to gaming with bigger questions on the horizon what are apple's ambitions in autonomous driving. are augmented reality glasses on the way? all of this change coming without jony ive as an employee. is he leaving later this year, though not totally gone. his new design firm will count apple as a client and he will continue to work with apple on exclusive projects analysts say this news wasn't a total surprise in the last few years he stepped back from his role lots of questions for invests about that design team and leadership at the iphone maker a course confirming that two design firm veterans will report to coo jeff williams they took over day-to-day operations of the design team as ives was focused on the cupertino facility >> for more on what happens from here, let's bring in dan primack. ive is a legend, but what does this mean for apple immediately? >> immediately, not much he's a big news story. he's legend. he's the strongest link to steve jobs from the early days of this version of apple i don't think it means that much members of his team are sticking around this has been a structure thing. he didn't leave suddenly this has been planned. he will continue working with the company as a contractor. so i don't think it means that much as the services business grows, the big issue for apple is not so much what the next product will look like, it's what it is. >> there's a story by john gruber that was pointed out as worth reading, he says that honestly apple's product line is so far out that you're probably still going to see ive-inspired products for the next five years in the line. >> that's far out. >> yeah. >> that's true he's still there sort of, but again as josh said, for the last couple of years he's primarily focused on the headquarters and the campus, which you can see. no one was concerned about this two weeks ago when wasn't that involved >> what happens next does it matter that apple has not named a replacement for him at this point? >> i don't think so. i assume it's a matter of time that might be a pure pr strategy this guy has been important to us he will continue to be important to us kind of in this independent outside role give him his moment yesterday, maybe announce something next week or next month >> one thing we were talking about is the esthetic of apple, the esthetic of every device for a very, very long time has had a particular esthetic. when you looked at something, even though it was a black slab, you knew it was an apple device, even with it being off or you look at a laptop or something else as the company gets bigger, as the number of skews and product lines that it gets involved in grows, how much does it risk looking more like an electronic consumer company >> it is an electronic consumer company with a big software component. the ive esthetic is set at apple for a certain extent on the hardware side, you talk maybe about ar glasses, maybe about a car. we've been talking about that for years. outside of the watch, the really only new product category that entered since steve jobs' death, that was an apple product and it is still jony ive's people running this thing you will continue to know whether that's an ar glass but can they have another ha hardware hit >> dan, always great to see you. >> thanks for having me. coming up, more talk last night of running against the trump economy in 2020. we'll debate whether that strategy will work as we head to break, a quick check of what's happening in european markets right now johnson & johnson is a baby company. but we're also a company that controls hiv, fights cancer, repairs shattered bones, relieves depression, restores heart rhythms, helps you back from strokes, and keeps you healthy your whole life. from the day you're born we never stop taking care of you. donald trump put us in a horrible situation we do have enormous inequality we can make cuts in the tax loopholes out there, and i would go about eliminating donald trump's tax cuts for the wealthy. that was former vice president joe biden, in case you didn't know him or recognize him, weighing in on the trump tax cuts last night in the second round of the first democratic presidential debate joining us now with the big takeaways are former massachusetts congressman barney frank. he served as house financial services committee chairman and also a cnbc contributor, and former indiana congressman david mcintosh, president for the club for growth congressmen, thank you for joining us >> grade eat to be with you >> i am used to calling congressman frank chairman >> the rule is you get called whatever you peaked at for the rest of your life. >> exactly you have much more to do still you're not on the downward slide. whoever wants to start congressman, do you think that the economy is going to be the winning issue -- the trump economy for the democrats? >> no, don't think it will be the winning issue. what's striking is that it won't be the winning issue for mr. trump. it's an unusual situation in which the economy appears to be less of an issue than it has been >> it sounds like you're conceding the economy is pretty good, but personal issues or whatever, that could outweigh what is a good economy >> probably. we will argue and i firmly believe that the -- this is part of trump's problem i don't think the economy it is clearer that it was the uber approach of a huge deficit that super charged the economy. by the way, among those who appears to be convinced that the economy is not in all that good shape is donald trump because this assault on the fed -- by the way, i've never agreed that you couldn't criticize the fed i thought greenspan was overvenerated, but trump is saying the economy is a little shaker than what it looks and i think that's what we will be able to talk about the other piece, it is the micro economic issues, beginning with healthcare. >> because you do need to look, i think, at, like you said, maybe take a deeper dive in the economy. david, i'm wondering whether independents -- i know democrats this is -- income inequality, we've had frank luntz on, he's going to be on again, and they've never been more sort of energized by that argument, but i'm just wondering if independents and certainly i know republicans when we hear we don't want a food fight we want to try to put food on americans tables and things are so bad right now, with where unemployment is overall and for minorities, and gdp or any of the measures, stock market, any of the measures you look at to keep hammering how bad the economy is seems disingenuous to me to independents. >> and what's more, joe, i think what the debate showed is almost all of the democrats up there will hand trump an opportunity to make the economy an issue because they've become so radical about their programs on the new green deal, huge tax increases that would stifle the job creation that is helping middle america and people there see it, and what trump can say is they are going to take that all away from you. so essentially you might not like my style, but i'm helping you a lot and it will get a lot worse for you and your kids if you go to one of these more radical democrats. that's what i think will happen in the fall. last night what we saw was more an inner-party fight or more of the social issues, in particular kamala harris' attack on joe biden on the busing issue. and we've been polling the democrat primary voters and more than the economy, they care a great deal about biden's history on busing and things like that, so she took advantage of it and really kind of launched herself as a credible candidate on that issue. interestingly, she also said i'm going to be for a tax cut, which set her apart from the democrats. so she both advanced in the primary and laid the ground for the fall that she might be the one that could be credible on economic issues. >> i wonder if she can -- that's what i was thinking, that kamala harris might throw a bone to centrists because if she gets in a position where she looks like she's, you know, really starting to poll well, she could bring in -- because i'm not sure raising your hand for free healthcare or health coverage for illegals, i don't know what that would poll nationally, do you, congressman frank >> i don't think it's that bad i think part of the problem here is a practical one, do you want a lot of sick people walking around do you want people with contagious diseases walking around >> if we have no borders -- if you combine everything where everyone is going to want to come here -- >> but we are not combining everything. >> kind of. >> nobody threw open borders -- maybe a handful of people. i think you saw this in what dave said, there is an alliance between many republicans and conservatives and alexandria ocasio-cortez to greatly magnify her influence. in fact, as far as the green new deal is concerned, and you have nancy pelosi as the dominant democrat fortunately in my view, by the time this election season comes up it will be clear that the green new deal was nowhere it hadn't happened the democrats are focusing on healthcare -- >> but, barney, almost every -- almost all the candidates said they are for it. >> excuse me, are we going to get interrupting. >> go right ahead. >> thank you the fact is that they are not going to be enacting the green new deal i do agree the medicare for all, abolishing private insurance is a problem. i don't think in the end there's going to be a nominee who supports that, and part of it, as david said he's been polling, the democratic voters in the primary appear to be much more realistic to the frustration of some on the other side than this, and i think what you will see the democrats talking about is, first of all, and this is the biggest single one, infrastructure, which has great appeal, which trump said he was for, disappeared with the magnitude of the tax cut one of the things i think the democrats will be talking about is taking some of the money back from the upper end in the tax cut and putting it into infrastructure. >> so what we're seeing i would say is the democrat party shifting from where barney was, which is let's think about these real issues on the economy and infrastructure, to a much more progressive -- they're trying to nail down their progressive base in these primaries, but in doing so most of the candidates on the stage last night and the night before embraced the new green deal, even joe biden came very close to it with his own version. >> did you hear when kamala harris was asked do you think they have to pay for all of this, she used this example which i really hate which is, look, the republicans didn't seem to care when they raised taxes, we shouldn't care, either, which i also hate on the other end. >> not raise taxes when -- >> i mean when they lower taxes. >> first of all, i think it's clear that -- i think there are about 107 people in the country who are genuinely concerned about the definite over everything else, for everything else it's a thing to pete your opponents. i want to go back on the green new deal, yes, presidential candidates say things and we know that, everybody knows, the primary electorates on both sides are more idealogically committed than the general electorate i don't think they will be quite as blatant as the etch a sketch guy from mitt romney who said this is all going to be etch a sketched after the primary look at nancy pelosi and the democratic majority. you will not see anything very radical enacted. they will be pushing for infrastructure, they will be pushing for healthcare and by a year from now the threat of the green new deal isn't going to be credible because democrats having controlled the house through all that time won't have advanced it. >> i think that etch a sketch is right next to the binder full of women, right remember that? romney, he was a genius, wasn't he so you're still -- you still think it's going to be a biden -- >> i think that is likely. >> you think so, david >> i think he has some weaknesses that harris pointed out with potentially could lose the support he has among the democratic blacks. >> do you think she would take a deep spot? >> joe, yeah as the last person who turned down the vice presidency was high rum johnson in 1920 when he said he wasn't going to be warren harding's vice president and lost the -- >> i just heard andrew yang has accepted secretary of commerce apparently. >> that's what he's running for. now we know. >> gentlemen, thank you, congressmen. >> david, joe donnelly says hello. >> wonderful >> we have two big hrsou ahead we will be back in just a moment everyone, look at your phones. the design thinking, the digital engineering, security, blockchain, and we will be first to market! yes. when we do we launch? unfortunately, in 2 or 3, hours. why the delay? cognizant is helping banks use digital technologies at scale to advance speed to market. i felt completely helpless. trashed online. my entire career and business were in jeopardy. i called reputation defender. they were able to restore my good name. if you are under attack, i recommend calling reputation defender. vo: there's more negativity online than ever. reputation defender ensures that when people check you out, they'll find more of the truth, not trash. if you have search results that are wrong or unfair, visit reputationdefender.com or call 1-877-866-8555. g20 is in full swing president trump getting ready to meet with president xi to talk trade and what could be a pivotal moment for stocks. apple's chief design officer is calling it quits. the man behind the iphone and many other iconic products is leaving the company. what this means for the tech giant is coming up. and fight night in miami. >> senator harris. >> you can't afford to wait for evolution on these issues. >> hey, guys, do you know what, america does not want to witness a food fight, they want to to knew how we're going to put food on their table. >> highlights of the debate and how democrats are planning on taking on the trump economy. reaction from frank luntz is straight ahead the second hour of "squawk box" beginning right now. ♪ >> announcer: live from the beating heart of business, new york, this is "squawk box. ♪ >> i wish i had a new open is that not ready yet? >> we shot it yesterday. >> what are we waiting for could have worked all night. good morning. >> six hours of footage to find the right six seconds. >> the picture of you. >> good morning. my eyes aren't closed or something. did we get my good side? welcome back to "squawk box" here on cnbc i'm joe kernen along with becky quick and alex ross sorkin. 82 on the dow solidly positive with the nasdaq up just under 11 and the s&p indicated up about 8. >> market moving news will be taking place in japan where the g20 meeting is under way president trump getting ready for what could be a pivotal meeting with chinese president xi tomorrow. kayla tausche is there on the ground and joins us with more. >> reporter: the fact of that meeting is viewed as a positive since it could usher in the same outcome that happened in buenos aires and it ushered in a multi-month truce with productive negotiations and a suspension of tariffs. i'm told that outcome is not a done deal. both leaders will need to show flex ikt in helping the other country achieve their outcomes at some point down the road. ambassador light that you seer has already told the chinese viet premiere that any deal would not be balanced. earlier today president trump was asked by reporters whether he had agreed to suspend the next round of tariffs. here is what he said. >> we're going to have a meeting with president xi of china tomorrow, as you probably have heard. seems to be a rumor about that we are indeed. we look forward to it. i think it will be productive and, who knows, but i think it will be productive at a minimum it will be productive we will see what happens and what comes out of it >> reporter: leaders right now are attending a dinner and cultural program at osaka castle, a historic attraction here in town the pleasantries among leaders that you're seeing now, they belie what delegates said is little progress made on the official agenda of sustaining global growth, staving off a future recession and easing trade tensions, but of course, guys, everyone is watching for that meeting tomorrow to see if progress can be made on that last front >> thank you very much we will see you again at the top of the in ex hour. for more on what's ahead at tomorrow's meeting of presidents trump and xi let's bring in senator john barrasso, he is the chairman of the republican conference great to see you today. >> thanks, becky. >> so what do you think? >> i think it's a positive, i think that there's going to be good work done, but it's not a done deal yet. i know that american workers benefit from smart trade, i know that there are great opportunities, but we know that china cheats if it hadn't been for the tariffs these discussions wouldn't even be happening china steals our intellectual property, this he limit their markets to our -- our production, all of these things make it harder for americans so do tariffs matter yes. is it important to have them yes. but they are not an end in itself we need to get the solutions because we all benefit, i think, globally from portrayed. >> -- moretrade. >> there seems to be bipartisan support on what president trump has done in terms of cracking down on china and playing hard ball because of all the evidence that they are not playing on a level playing field. we are getting deeper into an election year, you are talking about things starting to heat up i know that you hear back from some of your constituents, too i wonder if you can just tell us how deep you feel support is at this point or if you think that more people are hoping that there's a deal reached sooner rather than later. >> i will be in wyoming this week at the cody stampede, the 100th anniversary there traveling the state of wyoming what i know i'm going to hear is people say we have products in wyoming, we want to sell overseas our number one cash crop is beef but on top of that we have trona, we have natural gas, we have coal and we want to have international markets for those products our economy benefits when we are more actively engaged in trade there's huge support for president trump, i think, all around wyoming and around the country and when you compare that to what we saw last night at the debate, previously it was joe biden that said, hey, china is nothing to worry about. china is our biggest long-term threat when we can corporate with them, we should. when we need to compete, we must and if it comes to confronting them and things like huawei, we have to do that as well. >> you know, it has gotten a little more complicated when you start wrapping in issues like huawei and trying to figure out how much of that is going to be a trade issue and how much of that is a security issue also when you start to consider things like north korea and iran, things that president xi of china is now saying, hey, we can help you on those issues, it's hard to separate the economic from the real threats that we're facing at this point, too. how do you kind of weed through that >> number one to me huawei is a national threat, its not something that can be used as a bargaining chip in trade i think you're right, you have the g20, you have a number of countries there, but it represents 86% of the economy of the world. you mentioned iran iran is a global threat. iran with a nuclear weapon makes the entire world less safe, less secure, less stable. so we need cooperation from around the world the sanctions and what president trump is doing is right, they are biting, it's great to have additional cooperation and i imagine the president is going to look for that as well. >> i want to bring that up directly with china. president xi has said that huawei needs to be part of the negotiations if they are to move forward on trade, that he wants a solution on that he's also said that he can help with north korea with north korea china is probably the most important player, this he would be the only one who could really put pressure on north korea to make them do more to open up and to maybe stop being to threatening. how do you take those two issues because obviously we want a better situation when it comes to trade, but when you look at real threats, north korea being the most immediate and then the potential for huawei, if that has to be on the table from the chinese perspective, how would you sort that out, senator >> well, i think that huawei is a true threat, it could be a trojan horse if it's in our economy and all of our communications and in what we have in terms of the computering -- in the computer world, but realistically that cannot be used as a bargaining chip we do need to see china take a more active roll in what they do in terms of north korea. so much of the money going into north korea comes directly from china. i think china should have been much more active in helping prevent north korea from using nuclear weapons and the missiles because in terms of the geography, there is the shared border and china is at risk as well from north korea. this he need to realize it's in their own best interest to tamp down activities in north korea. >> senator, i hate to relitigate the huawei issue, but the thing that concerns me is i think it's going to be the pivotal issue in this conversation for president xi, i can't see it any other way. i look to what took place with xte and some of the measures that we put in place, including our own people, by the way, literally in their offices could you see us thread the needle is there a way to use huawei as -- i hate to say a pawn in this trade war, but some kind of situation where we deemed huawei not a national threat -- security threat? >> well, for that you're going to need to be visiting also with the people from national intelligence and what we know what huawei is doing but you're right in terms of where we're seeing huawei increase their influence in our nato countries in terms of what they're talking about doing in england. huawei is having a bigger presence around the world, to me that's still a great concern and threat. >> but there's nothing that we could do in the same way we did with zte -- i don't know if you were comfortable with how zte was ultimately handled. >> no, not completely. i have great concerns abou huawei and the threat that it would provide to our country. >> senator, switching gears to last night, who would be the most formidable -- after you watched who do you think would be the most formidable opponent for trump/pence or opponents for trump/pence do you think and who do you think it will be and who would you with i wish it to be do you wish it was bernie or elizabeth warren >> i wish for a strong economy and a great future for america when i look at all of those candidates, both nights, this sharp left turn, they're careening over the liberal cliff. it's a 100 yard dash to the left every hand went up about free health insurance for illegal immigrants people want to tear down the barriers, get rid of a border, do more to invite more illegal immigrants to come to the country and say it's not even illegal to do it people saying we want to raise taxes -- >> you are avoiding the question it's like the people last night. you didn't answer me this might as well be a debate -- >> i'm happy for president trump to run against any of them because to me they are all essentially the same one size fits all healthcare with higher cost so people have to wait longer for worse care. they are all the same in terms of the green new deal penalizing our economy for some pipe dream that's not going to work to actually deal with the issues that we face they are all the same. they are all in the same clown car. >> a member of the old guard or new guard as the main -- do you think it's going to be biden, senator? >> well, right now he is leading the polls, he has lots of support out there, but you have this passing of the sovereign that they talked about, a lot of younger candidates and biden wasn't the oldest candidate on the stage, either. you have a number of candidates in their 70s, a number of younger candidates they are all the same in terms of this whole liberal group of wanting to raise taxes, wanting to -- wanting to tear down the border walls, wanting to deal with the economy in ways that i believe will hurt the economy. they want bigger government, more regulations, higher taxes and less freedom for american citizens and bringing other people to the front of the line. i don't think that helps. >> 40% of the people probably like that stuff and then you have 40 that don't and 20 in the middle that aren't sure what the hell is happening. >> senator, how should age be considered it's an interesting question both because of the age of biden and some of the others on the stage as well as our own president? >> well, people get to make decisions. everybody gets a vote, that's the beauty of america. so people can choose who they think is best. we are not going to even start voting for another about seven months in terms of the primary process. so what we're seeing, i think, is a clear delineation between the president, president trump who wants to grow the economy, knows how to do it with tax cuts, regulatory relief, unleashing american energy and this whole group of democrats to me this sharp left turn of focusing on penalizing america and american citizens and a one size fits all which really won't work for america whether it's healthcare, whether it's the environment, immigration, all of these issues, i think they're absolutely wrong. >> all right, senator. thank you. i mean, we have something here i have never held your relative inexperience against you in terms of -- >> that was a better answer. better come back >> that was reagan. >> that was a great come back from reagan. >> it was great. i know well -- all right. coming up, what's keeping a lid on oil prices. sully, brian sullivan, joins us with a look at crude ahead of a key opec meeting next week as we head to a break, check out the futures at this hour, up 82 points on the dow. quk x"n bc, you're watching "sawbo ocn dear tech, you've been making headlines. smart tech is everywhere. but is that enough? i need tech that understands my business. i need tech that works at scale. dear tech, dear tech, dear tech, we're using ibm blockchain to help make sure food stays fresh. we're exploring quantum to develop next generation energy. we're using ai to help create more accessible health care. we're using iot to create new kinds of digital wallets. let's see some more headlines about that. let's expect more from technology. let's put smart to work. is where people first gathered to form the stock exchangeee, which brought people together to invest in all the things that move us forward. every day, invesco combines ideas with technology, data with inspiration, investors with solutions. because the possibilities of life and investing are greater when we come together. ♪ here is what's making'd lines at this hour united continental has a new name as of today which sounds a lot like the old name, its corporate name is united airlines holdings, it dropped the last reference to continental airlines you probably remember united bought continental in 2010 and flew its last continental branded flight in 2012 bravo to united for sticking with that name instead of trying to hire somebody to come up with a fancy new name global merger and acquisition activity declined shorply during the second quarter global m&a volume was down 13% from the first quarter and down 27% from a year ago. the u.s. took the largest share of activity that did take place. u.s. m&a only down 3% while europe and asia saw deal volume caught in half. the government will be out with personal income and spending income from may at 8:30 it is expected to see an increase of 0.3%, spending is seen as rising by a half a percent. >> don't you think that united probably hired a consultant anyway. >> no i think they were just smart and realized we have a freight brand name, we've been phrasing out continental for years. >> somebody said trunk and they said there's already a trunk. >> verizon, venitor. >> truis might appeal to the millennials. >> come on, you have a great name as it was, trust. i literally thought that was a typo when it came up. >> generation m. >> generation m. someone suggested that, generation m millennials has a bad connotation. >> for you. >> huh >> with you. >> not anymore. >> now that you're on board. >> i'm down. >> woke to the woke. coming up, iphone designer -- wait a minute, this guy is leaving jony ive leaving apple what the move means for the tech giant and how it will affect tech giants coming up snow first time you heard it? >> it's ringing a bell. and a cincinnati staple montgomery inn ribs are some of the worlds best. do you know who used to have these sent every month. >> who did you have a bet with >> there's grader's ice cream, skyline and montgomery bob hope used to get these sent all the way out to the desert. >> is it hot >> it can be. >> how is small business surviving amid pork prices and usmca. we will talk barbecue 4th. wages and more with one of the restaurant's top execs didn't you marry into the family, evan never mind we will be right back. people know aflac. aflac! but not when to use it. do i use aflac when the kids get slime in the plumbing? no. that's home owner's insurance. slime in my motorcycle. no. that's motorcycle insurance. slime everywhere? ughhh nooo, there's no insurance for that. do they help when i have bills health insurance doesn't cover? yeah! that's it! aflac! gross guys. get help with expenses health insurance doesn't cover. get to know us at aflac.com now the answer to today's aflac trivia question. in what year was the first corvette assembled the answer, 1953 all right. welcome back, everybody. the latest trade developments may be happening at the g20 summit but main street is watching closely right here at home kate rodgers joins us with more. kate, good morning. >> hi, becky, good morning small business advocates are hoping for some resolution at this summit to ease these ongoing trade tensions the small business and entrepreneurship council said in part that hopefully as president trump engages with trading partners there will be positive movement and agreement on removing new tariffs and a pledge to open markets, forge new agreements and not impose tariffs. meanwhile, the national small business association has said that punitive tariffs can be truly damaging to small businesses who rely on imported goods to provide a service and can further harm small businesses who are looking to export due to retaliatory tariffs. earlier this year the national federation of independent business reported that one-third of its membership had been somewhat or negatively impacted by changes in trade relationships with china, mexico or canada. now, the group added that as the debate continues it is important that leaders recognize that if a policy won't work for small businesses, it won't work for the broader economy. despite push back on trade, small business optimism by multiple measures is still hovering near highs seen throughout the president's term. back over to you. >> thank you, kate joining us no you to talk about a lot of stuff, china tariffs on pork, the usmca and the fourth of july is cincinnati legend evan andrews, vice president of montgomery inn, a cincinnati restaurant, more than one restaurant whose specialty is ribs, also the boathouse. >> right. >> which people have been long time friend of "squawk box" and if you're from cincinnati you know -- you just know the montgomery inn you ship all over the place. >> we do, we ship coast to coast every day. >> online coast to coast i'm amazed, andrew, this is all plant-based and this is wood these ribs are actually made out of wood -- no, this is not. >> what? >> no, this is not. >> this is pork. this is real. >> this is real pork. >> you're not doing beyond meet anytime soon. >> you never know. >> come on, folks. >> you have to try it. >> have you had it >> of course we've had this >> here is a couple things to keep this pertinent, china doesn't really need to import pork really that much unless they have like a problem with -- and they've had problems before, but they are big pork producers, are nt they? >> they're big pork producers, big pork importers as well. >> they are. >> they are. >> it would make a difference if there's some type of -- >> there is, but one man's, you know, poison is another man's pleasure so while china may not be importing a lot, that's going to create a small glut in the united states, pork prices for the consumer may come down a little bit the bigger sphere is all the rain that we've had in the midwest, can't get the corn into the fields, we may see a shortage on feed and that's going to take protein, all protein, up a little bit. >> what does that mean for your bottom line? >> it doesn't help and it's not -- we can't pass it on to the consumer, we're going to have to eat a lot of that for right now. we're a little bit worried about the feed, what may happen downstream a year, two years down the road, but for right now we're okay. >> the usmca thing is interesting, this highlights canada, they are our friends mexico and canada get the lion's share of our pork exports, right? >> they do what's interesting is we are allowed to sell them raw product. >> but no cooked >> we are not allowed to ship cooked processed pork. >> anywhere in canada. >> these ribs are from canada. >> great pork. >> great pork. >> come down here but you can't send it back. >> i can't send it back. we have customers from toronto, montreal, all over canada, they've been to the restaurants, have had them, said why can't i ship them back. >> not even tariffs, it's protectionism. >> pure and simple. >> pure and simple. >> we're hoping -- >> the usmca. >> it's not in there yet, but we're hoping. >> have you made a pilgrimage to d.c. to lobby this issue. >> we tried. >> you tried. >> we do our best. >> mexico is important. >> mexico is very important. and i think everything is going to work out. i really do. i'm confident that the president is going to get everything worked out and it's a short-term pain but i think it's going to be a long term fien for everybody. i think it will work out. >> so how much -- i was going to tell people that i said at the beginning so grader's, everybody knows graeter's. >> best ice cream in the world. >> everybody knows skyline. >> skyline chili. >> online you can get -- my mouth is watering, it's hard to talk -- you can get ribs, you can get skyline, you can make your own -- >> make your own basket. we pack everything to order, ribs, ice cream, skyline chili, our burgers, steaks, chops, throw it in a big box with dry ice and it's there the next day. >> overall do you notice in cincinnati an economy that feels like a 3.5% unemployment economy? >> markets -- the economy is terrific things are doing well. the restaurant business is a challenge because we have a lot more restaurants, people feel more confident, take a risk, open up a restaurant. >> do you have to pay them more? >> that's the key. we're not -- we're not getting an influx of employees moving to cincinnati. >> a big part of your business now is online. >> it is a big part. 25% of the top line, about 35% of the bottom line is represented through our online services. >> where do you want that to ultimately be? do you want that to be 50% of your business? >> i would love it to be 50% of our business. >> a higher profit margin business. >> higher profit per customer you might say. >> because they order a lot? >> they do they see the freight is $19.95 on a ground shipment, they will say instead of spending $100, give me two or three more slabs, throw some brisket baked beans out there. it works out. >> i have a good question. what do you make of this meatless craze >> jamie richardson from white castle who was on with you, we serve on the restaurant association, the board together, and they picked impossible over beyond because it was -- well, a quality issue they thought for them. >> they liked the impossible burger bet sthoor they do. the bigger problem is the pipeline there is not enough product out there to fill some of the demand so i think some restaurants are a little wary do i bring it in as a special, as a quick in and out and that's it, or do i make it as a staple >> is somebody working on doing a meatless version of this, a meatless rib >> i don't know. i haven't heard about it yet. >> that's what this is we were fooling it it's wood. >> it's not. i just tried it. >> no one has ever won the white house without winning ohio. >> correct >> do you remember what you told me last night i was in cincinnati >> what did i tell you and scott. he >> you can tell them. >> and you knew because -- you said trump was going to win. no doubt in your mind that he was going to win based on -- >> a lot of it our employees people don't poll the real working class that's back in the kitchen, they're waiting on tables, that are unloading the trucks when you listened to them and you heard what really was bothering them, it was more driven by what president trump was saying these are the things that really -- >> what about though >> same thing. maybe more they're really -- they don't like to vocalize it because no one likes to be combative. don't talk religion, don't talk politics, i was warned on the elevator down by my wife don't talk politics. >> what are the issues that are driving them >> the bottom line is paycheck, it's all about your paycheck, am i taking home more money, do i feel more comfortable when i wake up that when i go to work my job will be secure and will be there. >> what are you paying right now? >> if andrew spent some time there do you think he might have a different perspective? you see what happened to me, but do you think that it would be a different perspective? >> absolutely. i think everyone would benefit by coming to cincinnati. >> unless you like baseball. >> we're doing better. >> i saw you won six straight and then we lost five straight or four straight. >> at least we won six straight. >> talking paycheck, what are you paying these days? >> we don't pay anybody minimum wage, no one gets paid minimum wage. >> less? >> no. thanks a lot. >> i don't know how you get around that. >> you can't >> i'm kidding >> and the minimum wage really isn't a driver for us. it's about how do you get these people to understand -- >> have you been forced, though, do you think over the last two years to really push prices up >> our prices? absolutely yeah the cost of doing business is a lot more, especially with healthcare. >> thank you when we come back, highlights from last night's democratic presidential debate. we will debate it right here on "squawk box. ♪ ♪ all right. you have to take a shot of this, he's eating, he was loving it until he heard this song and in the meantime -- >> eating ribs with a fork. >> what is this, seinfeld. >> like de blasio with the pizza, right who was that >> no, it was somebody else. >> trump >> i think -- >> no, it was -- who was that? it was a presidential candidate, i think, but i don't think it was trump. >> elaine bennis. >> no, it was a guy. opec leader getting ready to meet in vienna they may be frustrated -- >> it was de blasio. >> was it? >> it was de blasio. >> he killed a groundhog and he was -- >> it was de blasio. >> eating groundhog with a fork. >> no. brian sullivan is here to talk opec and much more, pizza, ribs, all the rest of it, but really they're ticked off even though prices have skyrocketed pretty much? >> well, i mean, here is the thing, though, i have a little package coming up that we will dive into it. >> a package. >> a package. >> how long is it? >> 60 seconds on the nose. >> excellent >> i'm good. i'm good >> go to the package. >> here is the thing, back in the day if you had tankers being blown up, drones being shot down and venezuela collapse oil might have been at $100 a barrel but oil remains under $60 a barrels, maybe confusing some people. why hasn't oil spiked even higher here is four reasons >> it's not one thing that has kept oil prices relatively stable, but a few. first and foremost, record american oil production. the u.s. could be headed to 13 or even 14 million barrels per day. and this oil largely considered risk-free, meaning it's not subject to the whims of geopolitics. next, it's not just us russian production remains elevated as well while russian output is down fractionally from a few months ago they are still above 11 million barrels a day. that's likely frustrating opec who was hoping last year's 1.2 million barrel per day cut into firm up prices speaking of opec, another problem is that not everybody believes that deal to put production is going to hold up some traders are worried that should the opec deal break another million plus barrels a day will hit an already oversupplied market. finally oil has been held down by growing fears of an economic slowdown around the world. if the world's major economies begin to taper off demand for oil will fall leaving more excess barrels on the market four reasons why the oil bulls have been put out to pasture at least for now. >> there you go, guys. bottom line is there's a lot of oil in the world right now, the u.s. is risk free and the russians, we're blaming everything on the russians, the election, no you of course oil not moving higher. we will see what happens the meeting coming up on monday, a little russia/saudi thing, maybe they're friendly in front of the cam ration i'm not sure the saudis are happy with the russian production numbers of course, you have the iran situation hanging out there, will they even go? will they even go? >> i would think the biggest issue has to be drilling here in the united states, what we're seen in the permian basin and other places that is the new thing that creates a ceiling, right >> yeah, and the cap on the permian right now has been you can't get the oil out, but -- so we could go to 14 million barrels a day in the united states if we could get the oil out. we've got two pipelines that are coming online in the next year. >> and that's going to change everything. >> that's going to help. we could easily go to 14 million. the market has sort of already started to price that in plus if opec breaks their production cut deal, 1.2 million barrels a day, they break it, they can't come to an agreement, if they don't, that's another million barrels on the market. that's a lot of barrels. >> you missed the joe eating ribs picture in picture. >> they had it in a double box. >> no. >> so those ribs are a metaphor for opec so there's excess oil, that's the rib, on the market so if you ate those ribs prices would firm up, but there's excess -- >> take one bite. >> andrew eats -- >> i'm not eating on tv. >> do you have a bone to pick with my rib metaphor. >> why couldn't it have been a two-minute package >> we have about maybe 90 seconds of a commercial break and let's see if you can down those during that period. >> i think i can. >> brian, thank you, sir. >> thank you. >> when we come back, the en of an era as the chi architect behind many of apple's innovations over the past 20 years from the ipod to the apple watch says he is leaving the company. we are going to discuss that after the break. may only be 60 seconds, by the way, here are the futures at this hour. stay tuned for joe -- we're going to maybe run that during the commercial break it 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with technology, data with inspiration, investors with solutions. so that every day together, it all starts again. ♪ well, the man behind some of apple's most recognizable products is leaving the company, chief design officer jony ive is starting his own design firm with apple as one of his clients. for more let's welcome ed lee, "new york times" media reporter and a cnbc contributor we've talked about it a few times already. was it a big surprise to you i just wouldn't think so. >> there was always a question about whether he was really fully back in the fold or not. he had been instrumental in the design of the new headquarters. >> right. >> he had taken a break from every day apple stuff while he was doing that, people think, oh, is he really kind of leaving? and then when the headquarters was finished he was like, no, i'm back, i'm back at work. >> really? >> so it was a shock in that way. all of a sudden it's like, wait a minute, i thought you said you were going to be back. but the bigger picture is that he sort of stepped away for a while. >> you think he has not had his imprint on, for example, the last ipad, the last iphone >> because there are not big step changes in the design, right? there are improvements certainly, like software improvements and then there's certain tweaks into the hardware, they're not massive. >> what do you think the consulting or contractual role will be? >> he's starting his own company but his primary client will be apple. i think it just formalizes what's been happening which is he's freelanced for other things, other projects outside of apple in the last few years i think he wants to do more of that he will still do stuff for apple, but, again, i think the other big narrative is that apple is becoming more of a services and software company and less of a hardware company this sort of shift is a signal of that. >> shift >> shift >> what did you think i said >> wow in i go goes here today. >> we've been talking about the aesthetic of apple how much of the aesthetic of apple do you ascribe to jony, how much do you ascribe to steve jobs and that collaboration, how much of that aesthetic can be maintained, how much of that is about one person's eye even if you look at some of the apple stores and i know, you know, angela came in afterwards and of course departed since, but jony worked close ily with her on that. >> even earlier before she ever arrived in terms of exactly the way that would feel, what those tables would look like, that whole experience. >> i think apple's big legacy, steve jobs' big legacy is he created technology for non-technology people in a lot of ways, guys like joe basically. >> yeah. >> and that's good i think he made it accessible. that's the large point jony ive the same idea i think that's why in a lot of ways for a lot of people he was a real successor to steve jobs, more so than tim cook in that way. it was nice to have the two together tim cook is the operations guy, that's his expertise, jony is guy that i want it to look and feel like this that made the difference between a hit product and something that just sort of was whatever. i think in this way it's a huge shift for apple, but, again, they've been heading in this direction anyway sales of iphone have been down, less of a hardware concern and more of a let me sell you a service thing, even that of course -- even though services business is on the rise it's not a huge, huge business. and i think the last big point here is where is the vision going to come from because jony was a big part of the vision the ipod which preceded the iphone, he was a huge hand in developing that and creating it. the look and feel. so he created a cultural moment around the ipod, the way that sony did with the walkman decades earlier. that led to the iphone which sort of changed everything he was a big part of the mobile revolution at apple. all of these products that he created, the ipod, the ipad, the iphone, so these are a big part of -- came out of jony's brand this is a big, big change for apple. >> where is the vision going to come from, that's the about i go question. >> good to see you have a great weekend. when we come back, some key moments from last night's presidential debate. pollster and political strategist frank luntz will join us after the break here are some of the stocks to watch this today's trading. "squawk box" will be right back. your brain is an amazing thing. but as you get older, it naturally begins to change, causing a lack of sharpness, or even trouble with recall. thankfully, the breakthrough in prevagen helps your brain and actually improves memory. the secret is an ingredient originally discovered... in jellyfish. in clinical trials, prevagen has been shown to improve short-term memory. prevagen. healthier brain. better life. but we're also a company that controls hiv, fights cancer, repairs shattered bones, relieves depression, restores heart rhythms, helps you back from strokes, and keeps you healthy your whole life. from the day you're born we never stop taking care of you. democratic presidential hopefuls squaring off in miami last night ee land knewy was there and joins us right now with the highlights good to see you. >> reporter: hi, becky last night was a clash of candidates, the debate was defined by disagreements over policy issues like healthcare and personal ones like race. bernie sanders was forced to defend medicare for all and acknowledge that he would have to raise taxes in order to pay for it john hickenlooper called on his fellow democrats to reject socialism and pete buttigieg took some heat over the way he's handled the unrest in south bend following the shooting of a black man. but the biggest and most dramatic showdown of the evening was between joe biden and kamala harris over race >> i do not believe you are a racist and i agree with you when you commit yourself to the importance of finding common ground, but i also believe, and it is personal and it was hurtful to hear you talk about the reputations of two united states senators who built their reputations and career on the segregation of race in this country. >> that's a mischaracterization of my position across the board. i did not praise racists that is not true >> vice president biden, do you agree today, do you agree today that you were wrong to oppose busing in america then >> no. >> do you agree? >> i did not oppose busing in america. what i opposed is busing ordered by the department of education >> reporter: now, this was a breakout moment for harris, a bruising one for biden guys, i think that this moment is really striking a nerve because it gets at the question of who should define the democratic party is it going to be the white middle class voter or is it going to be the younger more diverse electorate we will see in the days and weeks and months to come back over to you. >> thank you for that report. to continue this conversation right now on the best and worst moments of last night back with us this morning we're thrilled to have him, political strategist and pollster frank luntz is here we're about to walk through several moments from last night, but, frank, let's talk about this moment that we just saw and its significance. >> i've got one word for it, boom i feel like cramer now she owned it she owned the stage and joe biden should have known it was coming he was criticized earlier because he had said 32 years ago let's pass the torch you know what attacks are going to happen. you're supposed to be prepared for it and i have to tell you don't just focus on the national numbers, what really matters is iowa, new hampshire, south carolina south carolina is 40% african-american, in the democratic primary she has now staked a clear claim to that vote, a number of them have been supporting biden up to this point. >> you think we're going to look at the numbers a week from no you and it's going to be markedly different as a function of that moment >> in the states that matter, absolutely now, again, we are misleading people the media misleads people when they only focus on the national data, you have to focus on the states that matter. >> want to show you another moment from kamala harris last night. >> senator harris -- senator harris -- we will let you all speak. >> we can't afford to wait for evolution on these issues. >> hey, guys, do you know what, america does not want to witness a food fight, this he want to know how we're going to put food on their table >> was she the winner of last night? >> absolutely. she is the winner of both nights that was a brilliant debate performance. and you're going to be rehearsed, you're going to know that there's going to be this little bit of chaos between the questions. why was she the only one who was prepared with a great response her media consultant jim margolis, smart guy, a great team behind her. that showed the experience of someone who has been in the senate a lot longer than she has been. >> a former prosecutor. >> she's prepared for this now everyone will be focusing on her, where she stands on the i wish auto us, this he will make her clarify some of the positions with i she has not done up to this point, but that is a brilliant debate performance. >> can she take the mantle of electability from biden? i mean, in the general, do you think she could be as competitive as joe biden i mean, when i try to figure out what biden has, that is his chief asset and i think he still has that because hollywood, they would go with the flavor of the month they would love to not have to back biden, but they are and that's totally about defeating trump. >> so i'm getting texts all through the debate, she looks too angry, she looks too mean and i'm thinking to myself they don't understand democratic primary voters this he want to take it to the president, they want to be tough as nails. >> in the general can she compete as well as biden >> i'm not going to answer that because -- >> too early. >> that's not what this is about and we have to stay focus on an electorate that many of your viewers don't know anything about. they don't hang out with working class voters, they don't interact with working class voters as well as the upper middle class. >> so biden's entire message of trying to be somebody who can work and reach across the aisle is different from what many of the younger candidates are saying which is this is about resistant, fight you think that's what's going to make it through. >> i think in the end it's the resistance and fight voters that beat the conciliatory voters. >> i want to show you something in particular on joe biden this is interesting, especially for our audience biden was asked about some remarks that he made recently to a group of wealthy donors right here in new york city in which he said that we shouldn't, quote, demonize the reach. here is what he said on the debate stage, how, about addressing income inequality. >> look, donald trump thinks wall street built america. ordinary middle class americans built america. donald trump has put us in a horrible situation we do have enormous income inequality and the one thing i agree on is we can make massive cuts in the $1.6 trillion in tax loopholes out there and i would be going about eliminating donald trump's tax cuts for the wealthy. >> what was the answer >> so it's a warren success and joe biden is one of the generals in that war. >> you heard what he said in that he did not address what he said to those rich donors and they didn't follow up, they didn't -- >> yeah, but that's not what matters. what matters is what he said here. >> he had that answer ready to go. >> okay. >> but he didn't answer what about you saying that nothing is going to change for you rich people that's what he said. so he sort of gave them sort of a -- >> yes, and that surprises you and that surprises you. >> i think that one of the moderators could have said, joe, what about what you said -- >> you would say what happens in cass blank can a, right, you're shocked about what happens in the -- >> then why watch? >> there is going to be a class war brewing in this country between the have's and have not's. i hear it in my focus groups, i see it in my polling this is real and the democratic debates are going to bring that about. the question you have to answer is what are you going to do to try to bring the country together and in one of these candidates are doing that. >> let me show you one last candidate, bernie sanders right now attacking wall street last night. let's take a look at one more moment from that second debate. >> the issue is who has the guts to take on wall street, to take on the fossil fuel industry, to take on the big money interests who have unbelievable influence over the economic and political life of this country >> okay. so if harris was the winner where does bernie come out, where do you put biden if you were going to rank it? >> i'm putting biden at the bottom. >> bottom at the biden. >> yes, biden at the bottom. >> out of all ten of them? >> no. >> just a -- >> yeah, there are several up there who either got lost or you wonder what they're doing on the stage. i -- >> when does hollywood switch to camilla and cnn already made the switch last night to camilla. >> we had two candidates from colorado and i'm convinced that several others were smoking something last night based on their responses. the challenge for biden right now is how quickly does he stop the bleeding the challenge from come la -- i want to know where senator harris is today. is she in iowa, in new hampshire. >> rob rhiner is not a committed biden person, he's ready to switch in a second. >> where is bernie sanders now >> no better, no worse than he was before. >> elizabeth warren. >> she is up from where she was. buttigieg is up from where he was and joe biden is down. joe biden is bleeding today. >> will we see joe biden fall legitimately in the polls. >> you will see him fall but he's still going to be number one when i sue you in a month. >> great to see you. coming up, chalk expect this weekend from the g20 meeting. later, it's the one-year anniversary of the hard rock hotel and casino in atlantic city we will speak to the ceo about the casino business when we tu rern your daily dashboard from fidelity. a visual snapshot of your investments. key portfolio events. all in one place. because when it's decision time... you need decision tech. only from fidelity. designer of the iphone, ipod and ipad is moving on. can apple keep making revolutionary products without him? countdown to the main event at the g20 president trump gets set for a highly anticipated meeting with china's leader, with markets pinning their hopes on a deal. speaking of markets, it is the final trading day of the first half of the year we will tell you just how historic these last six months have been. the final hour of "squawk box" begins right now ♪ ♪ >> announcer: live from the most powerful city in the world, new york, this is "squawk box. ♪ good morning and welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square, i'm joe kernen along with becky quick and andrew ross sorkin the futures up about 90 from where they had been. the nasdaq indicated up 12 in spite of some weakness in apple, in the s&p up about 8. treasuries i saw the yield was falling again, but just above 2% when i checked this morning, 2.017% okay let's get you through some of the other stories we are looking at this hour apple's chief design officer, so responsible for the iconic aesthetic of the company, jony ive leaving apple to start his own independent design firm. ive has been with apple since 1992, helped design key products as the i mac and iphone and we will be talking a lot more about ives' legacy this morning and what his departure could mean. boeing attempting to all 737 max fixes done by september. this includes a fix for a newly discovered software issue that was revealed by the company on wednesday. we are also going to talk more about that later this hour. nike reported earnings of 62 cents per share for its latest quarter, 4 krebts below estimates. the revenue did beat street forecasts. bottom line impacted by higher spending on marketing and in you product launches that stock down marginally right now. president trump getting ready for a much anticipated sit-down with china's president at the g20 summit this weekend kayla tausche is on the ground and joins us with more right now. what else are we anticipating? what are we thinking >> reporter: well, about he canny, throughout the morning i've been reaching out to my sources at the white house to try to handicap a little bit more clearly what we should be expecting to come out of this meeting tomorrow one white house official was reluctant to say firmly that a truce would be the outcome tomorrow, noting that it's essentially up to the president and no one can predict what he does behind closed doors i just spoke to another senior administration official who said that he expects a truce to happen, that generally the rhythm of these things, the ebb and flow of these talks is that these periods of heightened rhetoric are followed by cooler periods of negotiations and he expects that that's what will follow the meeting that will take place tomorrow. he said the truce talk is more than speculation and that's essentially the working assumption within the white house, although he says there's no working assumption for how long such a truce would last i asked about how the president is preparing for this meeting. he said it's essentially been a constant conversation for the last several months. i'm still awaiting formal word from the white house about how the president has been briefed for this meeting that has the potential to be a market moving event by his team that's here in osaka with him but he has been tweeting he is at a dinner with all of the g20 leaders right now, but before he left for that dinner he tweeted this about the stock market, he was saying, again, about the stock market gains, since the election, saying the stock market went up massively from the day after i won the election all the way up to the day i took office because of the enthusiasm that i was going to be president he's talking about the stock market gains here and i asked this official whether the stock market was still an important indicator, a leading indicator for the president in these talks and this official said it is still one of the most important considerations for the president going into these talks tomorrow. i asked what could be the hang up and this official said if president xi says definitively he is not willing to enforce this deal, he's not willing to write it into chinese law and he's not willing to have china make any changes to these practices that have become the source of this trade dispute, then that's what would cause the president to walk away and to increase tariffs without a truce. so that's the latest where we stand now, we still have several hours to go before that meeting. >> real quick, do you have any sense of how a detente could be realized in the context of the issue around huawei? has there been any conversation on the ground about that >> reporter: i don't know what the conversation on the ground here in osaka has been, but i know there has been a conversation for the last several months about what forum would be appropriate for huawei to be discussed. all of the officials that have been working on these trade talks have said it's not appropriate for those to come up in the working level negotiations, it's something that the two leaders would have to discuss themselves. so there has been an expectation that huawei would come up between these two leaders, president trump has said that himself. huawei came up in a few of the bilaterals with other leaders today, so president trump may be trying to get a little more firepower going into that conversation tomorrow. >> all right kayla, thanks. for more let's bring in our guest, former deputy u.s. treasury secretary and former u.s. ambassador to germany, robert kimmet. mr. ambassador, thanks for joining us again today i'm thinking about how to approach the subject with you in a new way. what are the most powerful issues at play in what's happening here, trump's attempt at an upcoming reelection campaign and what a trade war or a weakening economy would mean to him, or president xi's perhaps concern about a slowdown and what's happening in china and really being hurt by some of these tariffs and trade wars what's calling the shots right now in your view that is so special to these two men >> good morning, joe i think your question is the key question in the end trade negotiations are about domestic politics for the two leaders. my own view right now is while there's some pressure on president trump i think there's more pressure on president xi because he's been trying to be more authoritatively in charge of the chinese economy, more centralization, more party control, and the economy is slowing in china, perhaps because of global slowdown, but a lot because of things that are it you have in china so we are at the point in these trade negotiations that every negotiation comes to and that is the leaders have to make that domestic political calculation of whether the time is right to move to a deal >> we've talked a lot about the chinese people and how quickly life has been improving for so many chinese in the past 25 years. but that improvement i would think needs to continue and it's not finished yet i don't know what the gdp per capita is, but maybe it's a quarter of the united states i mean, they've got a long way to go. they've given the benefit of the doubt to the communist party and to president xi at this point. will that last forever are they ready for a protracted period of malaise, do you think, before they say, hey, i want everything the west has? >> i think citizens in all countries ask what have you done for me lately? i think there has been the trend in china, the upper trend that you described, but lately things have been moving a little bit sideways and i think for the communist party the fundamental burgen that they have struck is we are going to keep this economy growing in hopes that you will be satisfied enough to the to push for political reform that is xi's calculation and these trade negotiations play right into that most fundamental of domestic questions for him. >> so you say -- i think you are of the view that the negotiators have been negotiating a lot and we know where both sides are right now and they're not going to be the ones that get this done, it's going to be president trump and president xi, and they both could do it, couldn't they? if they wanted to come to a deal or agreement to eventually reach a deal, does it have to come right from the top >> it absolutely has to come from the top frankly i think the deal is on the table. i think the question is how does each leader portray that as a win for his country, for his citizens chinese talk a lot about win-win situations of course, in every negotiation each side wants to feel that it has achieved its strategic goal. in the end i think the negotiators have done their job, i'm not saying there isn't some further tinkering that can be done, but this is at that classic moment in every trade negotiation where the domestic political calculation has to be done by the leaders and decide whether now is the time to move forward. i think the most likely result tomorrow is this truce that is continue to talk, but i can't exclude that it would be more domestically, politically palatable for xi or for trump to try to show some toughness coming out of the meeting. >> mr. ambassador, you say huawei adds a bit of complexity, but then you point out that economics and finance have always been part of the national security equation, so is it really different this time is this manageable somehow after trump has declared it a national security threat? is it possible to walk that back with certain concessions that huawei would make, or is that going to stay on the table that huawei is out no matter what >> the issue is going to stay on the table. the one thing that unites republicans, democrats, house, senate, congress and the white house in washington is concern about chinese technological theft, the chinese use of technology to try to come after our and others national security so huawei is going to remain on the table. i don't think it has to be a core discussion in the trade negotiations, in fact, trade negotiators wouldn't be the people to take on a tough complex national security issue of that sort my guess is that there will be as part of the agreement to move forward on the trade negotiations there will be a separate dialogue set up on huawei a bit like there was on zte, but as senator barrasso told you earlier, this is an issue of real bipartisan concern in the congress and i don't think the president has a lot of room for maneuver other than to listen to the chinese side, set up a separate channel to discuss that very difficult issue of huawei. >> you don't see a reprieve coming or some kind of temporary opening for them to continue doing business for the next three months as this gets negotiated or whatnot? >> i don't see it. i can't exclude it i think, though, the u.s. will probably agree to set up a separate high level discussion group on this subject. i don't know that from any discussions with anyone. i think it would be hard for the president to say flatly no to president xi, but i don't think he's going to agree to a reprieve. >> all right ambassador kimmitt, thanks once again for coming on. thanks for watching earlier, too. it's nice when guests can reference previous interviews. we appreciate that thanks >> thank you. >> and buy all of our sponsors products. >> do you have a my pillow >> can't have too many. >> have a good weekend. coming up, when we return, a lot more on jony ive's announcement that he's leaving apple, the tech giant building its modern reputation on the beauty and functionality of the iphone and ipad that he has been behind can they keep the winning streak alive now that it's chief design officer is moving on. plus sports betting in our neighbor to the west, new jersey, one year after the state took the plunge on that issue. we will talk to the team behind atlantic city's hard rock hotel and casino about the state of gaming and industry m&a. stay tuned coming up, jony ive's legacy at apple, the man behind the look and feel of the iphone, ipod and ipad is leaving his post and that could leave apple in a tough spot. jean munster will join us with his take stay tuned, you're watching "squawk box" on cnbc so ...how are you feeling? on a scale of one to five? one to five? it's more like five million. there's everything from happy to extremely happy. there's also angry. i'm really angry clive! actually, really angry. thank you. but what if your business could understand what your customers are feeling... and then do something about it. turn problems into opportunities. thanks drone. customers into fanatics change the whole experience. alright who wants to go again? i do! i do! i have a really good feeling about this. welcome back to "squawk box. the futures right now indicated up almost triple digits, the 9 and change the nasdaq indicated up 14 and the s&p indicated up 8. all right. shares of adaptive biotech surging yesterday in the company's public debut hello, everybody they gained 101.5% from the ipo price of $20 check out this interview with the ceo of adapted biotech who was here on the squawk set yesterday. >> yes yes, he was. >> our immune system has evolved over hundreds of millions of years in response to disease and adaptive has created technologies that allow us to tap into this information to read the jen knicks of the immune system to create clinical products to transform how we diagnose and treat disease. >> adaptive biotech is the second best ipo so far this year beyond meat, those are the only two companies to double the first day in their first day of trading, the stock is up 3.1% today. we are heading to atlantic city right now where we're joined by three guests at the center of the city's casino business, it's a big day for them and for new jersey with i just marked one year since sports betting was legalized we will talk about all of that and a much more. let's welcome jim allen, the ceo of hard rock international, we're also joined by investors joe jingole, the ceo of a nationally ranked contractor and construction manager and jack morris who is the ceo of edgewood properties. gentlemen, good to see all of you a year later jim, tell us how business has been >> business has actually been very good. you know, atlantic city is an interesting market, the summertime obviously being the peak season, no you coming into that particular venue. >> jack, let's talk a little bit about what you saw when you guys made this deal a year ago with carl icahn buying the company, kind of turning things around, you said you've been doing this for long enough that you thought it was a bottom in atlantic city. why did you think that and do you still think that's the case? >> well, it was the bottom and we've seen what we can do in a short period of time with the right brand and the right partner. we're excited about what's happening in atlantic city. >> i'm guessing you guys are getting some feedback in your ear just by your reactions on this we'll -- >> a little bit. >> okay. you guys are hearing yourselves back in your ear as you're talking, we will try to get that worked out as we're going through this joe, for a long time you've been doing business, you've been in the contracting business, in the construction business, what do you see happening right now not just in atlantic city but on a national paces, where do we stand and what can you say about the economy based on what you see? >> it's a good economy right now for construction both locally and nationally here in atlantic city i think where the hard rock and jack and ourselves are doing is really taken a focus on the community and programs that will take social responsibility and turn it into a currency our interfacing with the people in our community and it's really about jobs, creating jobs and opportunity. the hard rock opened with 20% atlantic city residents, and we are now up to 25% atlantic city residents. people in the community working in our building and we think it has transferred to really good business model. >> joe, what do you think about just construction overall across the nation and what you're seeing in your own markets are things slowing down at all is it full steam ahead >> we're seeing it strong. right now what's really needed is trained workforces. we are, you know, a union shop and organized labor, people are retiring and training and job training is going to be a big issue. >> jim, with the legalization of sports gambling, what has that meant? has that changed the dynamics of the business >> yeah, i think it's actually been very good for atlantic city, both the internet gaming and sports betting are two of the driving forces behind the increase of the double digits and the total gross gaming revenues here in atlantic city and even in the state of new jersey at the parra mutual so it's been a positive. >> we've also been watching m&a activity after seeing el dorado resorts buying caesars for $8.5 billion what does that mean? does it spark things does it mean you have to get bigger in the industry and what are the competitive juices like right now? >> well, it's really the latest chapter in the casino reach. we have somewhere else like vicci that was involved in the transaction where they're basically buying the real estate and creating rent structures back to an op co short term it's increasing the size of multii believe so that people are paying for gaming outsets. we do not think that is something we should jump into head first we have entered into one transaction similar to that in cincinnati when you start paying 18 plus billion dollars for a company you need to be very careful at what the numbers look like three to five years from now i know they've made a statement they're going to reduce corporate overhead by $500 million. having been in this industry for almost 40 years i think that's much easier said than done. >> when you start getting at deal prices like that does that tell you it's towards the end of a cycle? what else does it tell you that's happening in the industry >> i think certainly caesars, you know, being recast, if you will, with something that's been worked on for the last four to five years, if you remember the original transaction with tpg and apollo, frankly that transaction was north of $24 billion. so i think the industry anticipated this particular transaction. we certainly wish el dorado the best because it's important for them to be successful, but a lot of assets and a lot of assets that maybe have not had the right capital investment the last five years, so a lot of work to clean up, but hopefully they do well in the future. >> jack, with atlantic city there's always been so much promise in atlantic city and it feels like it's never really capitalized on any of that what's different this time why do you think atlantic city is a place that's going to succeed? >> well, what you've seen in a year so far, stockton college, their campus opened, they're doing very well, i believe they're going to start an addition to the campus, you have had south jersey industriesope their headquarters in atlantic city, you've seen new apartments for the first time being built, luxury apartments, a block away from hard rock, you're seeing tennessee avenue, the revitalization, small businesses, little cafes, the things that you want to see in a city like this so we think it's on its way back to being what atlantic city was and what we think it will be in the future. >> jim, i know the hard rock has property in the dominican republic at punta cana have you seen any impact on tourism there given all the headlines that are coming out of the dominican republic and just concern from potential tourists? >> yes 100% the market bookings are down, you know, in excess of 20% certainly that's understandable. i think this is the classic case of, you know, it's how important it is to make sure accurate information is reported to the general public it's also one of the challenges of being in a country like the dominican. their ministry of tourism has come out, made public statements last week. when you really study the numbers and it's important to make sure we all understand what numbers are factual and which ones are being exaggerated, but clearly, you know, there is a concern to make sure that people are safe in any foreign country. we operate in 75 different countries, we definitely have seen an impact to bookings we're hopeful we will be able to move forward most importantly it does not appear that there is some, you know, individual that is deliberately poisoning people, which was initially first reported >> it looks like it's what then? sort of moonshine that's just out there and that's what's doing this >> you know, i think it's frankly -- you know, it's part of today's media cycle the reality is that when people travel abroad people get sick simply many times by just drinking water that's different here than what they're used to in the united states there have been seven deaths, you know, over the last year and a half and certainly they will be investigated and we have to wait for the dominican to come back with specifics on all of those unfortunate passings. >> gentlemen, thank you very much for being with us congratulations on one year there at the hard rock. >> thank you, becky. >> great to see you. >> thank you so much when we come back we have breaking enocomic data personal income and spending numbers in just minutes. back in a moment direct messages have evolved. so should the way you bank. virtual wallet from pnc bank. just one way pnc is modernizing banking to help make things easier. pnc bank. make today the day. welcome back to "squawk box. i'm jim ur y'all from the floor of the cme with breaking data. the personal income number came out as plus .5 from an expected plus .3. a little better than expected. the personal spending number plus .4 a little worse than expected, plus .5. the same pattern than last month. real personal spending plus .2, lower than expected plus .4. pc deflator month over month plus .2. deflator year over year as expected as well the reaction was not much in the stocks we were up 6.5 coming in i think most focus will be on the g20. you know, i heard some smart guy was talking to you yesterday on air talking about how there's other stories to concentrate on, brexit, things like that i don't think the market is concentrating on anything else other than the g20 i think they want a positive or negative result, i think it's going to be a binary thing and i don't think the stocks can be a decisive move until we get that. the ten year is 2.017 going in, 2.017 now. back to you, becky. >> if this is a binary situation, let's create an analysis or let's pretend that we know what's going to happen you tell me how the market reacts let's say we walk into this, there is a meeting between the two of them, they agree to continue talking but there's no concrete deal that's reached, how does the market react? >> agreeing to continue talking without some very, very positive words accompanying it will be viewed as a negative outcome now that i said it was a binary outcome i'm going to walk that back i think the baseline for positive is that we're going to continue talking, with he made a tremendous amount of headway and hearing that from both sides that's a positive outcome. a negative outcome is walking away from the table and then there's going to be that amount of time between when the negative outcome happens to when the fed comes back to dry our tears and make us feel better and tell us that there's probably going to be a 50 basis point move in july which i do think will happen if we get a negative outcome, but the time in between is what i worry about. >> were you on yesterday, jim? >> yeah. >> earlier this week. >> when you said the smart guy said so, were you talking about yourself >> i believe i was. >> he was. >> you saw right through me. >> all he's doing is following your lead. >> yeah, he is. >> i was not, i was talking about you, joe >> there you go. there you go >> i really think he was -- i liked it i said, wow, that's masterful. a smart guy yesterday said -- huh? i know you like -- all right >> you do. i hate being figured out like that >> he's laughing jim, okay, let's play this, let's play the meeting goes okay, there's sort of positive stuff that comes from each side, no deal is met, they walk away the same way they walk into this where president xi saying we need to see huawei, we need so see x, we need to see y, president trump walks away saying you're not getting huawei, no the getting x, not getting y, but we are still talking. happy talk but no concrete measures and then the fed doesn't do anything. what's the market reaction then? >> that's a negative outcome i think the market may force its hand then. the market has been in pretty tight cons day testify pattern for the last couple weeks and i think what it's saying is we want something now if that happens i think the s&p goes below 2900 and starts forcing the issue. i think that would be viewed as a relatively negative outcome. i think there needs to be some progress made and some better more, you know, better feeling speech that comes out of it. >> more better >> yes >> jim, thank you. you're a really smart guy. have a great weekend. >> i appreciate it thank you. jony ive the designer behind the look and feel of the iphone, ipad and more is leaving apple a km he has called home for more than two decades josh lipton joins us with more on what this all means, josh, good morning. >> so, becky, it is the end of an era at apple. jony ive is leaving the company at the end of the year, his title really says it all, chief design officer he was instrumental, about he canny, in the design of some of apple's most iconic products so the i mac, ipod, ipad, the watch and of course the iphone, the most popular consumer tech product of all time, as well as apple's new state of the art headquartersers called apple park the news isn't a total surprise. in the last few years jony ive did step back from his role. what does this mean for invest rs the stock did tip on the news. this is a big change for apple fans jony ive was so closely tied to steve jobs who told walter isaacson if he had a spiritual partner at apple it was jony, the aesthetic they shared for simple seamless design bottom line for innest havers, the case has been made that any potential impact should be manageable because jony ive's new design firm will count apple as a client and that ive and apple will continue to work together on exclusive projects also current design team leaders at apple will remain in their leadership roles back to you. >> josh, thank you for that report i want to bring in gene munster to this conversation, founder and managing partner at loop ventures. good morning to you. you hear this news, stock sells off a little bit does this concern you? how does this change the game? >> it really doesn't i think josh's setup was spot on, andrew this has been in the works since 2015 i think investors should feel comfortable that the design expertise of apple is in great shape here nothing essentially changes. >> nothing changes to when you think -- and is that because you think that he hasn't really been involved over the last couple of years >> yeah, i think so. i think that this team, the core three people have been essentially doing the design for the three years, so effectively investors should feel confident that the design roadmap is inta intact. >> i have maybe i don't know if it's a curveball or something controversial to say what if i told you that the design of apple devices over the last two or three years actually hasn't been as aesthetically pure as some of the earlier products >> my sense is that i think if you look back at the watch, i think that is a step ahead of anything else in wearables i mean, the watch went from essentially no market share a few years late to the game to having caught 75% of the wearables share. one of the pieces that gets missed in this whole conversation about design is these new paradigms, these new shifts ultimately take several years to fold out and this next wave, i think the true test about design is not about what happened five years ago, but about what the next waves are going to be. specifically around wearables, around potentially transportation, around healthcare some massive opportunities so the easy, i think, fall back position is that apple has not been innovating around hardware, but i think the true test of this is going to be what happens with this next wave. i want to emphasize one other point, andrew, is that when you look at the investment that apple is making in hardware, it's really unprecedented compared to other tech companies. for example, we went through the last two conferences, wwdc and google io. they had 300 sessions between those two, 15% of apple sessions were dedicated to hardware and only 1% of google. so i think that this idea that innovation is -- or design is not a core feature of apple is simply misplaced. >> what is your expectation, then, for the future what are the two or three things you're looking for most people now i don't want to claim that they look as apple as a value stock with warren buffett and everybody else in the stock, but what is the thing that you think is the future of this company >> so i think there's two phases to this. this current phase is going to be around services, there's been a lot talked about that. i think the next phase is going to be around we talked about wearables, hear abls, i think you will see more products in the next year related to that. i was dead wrong on apple as a tv, it was a painful lesson for me about what products are in development doesn't necessarily see the light of day, but i do believe that what apple is working around glasses, specifically, andrew, is an area augmented reality glass and ultimately they're pulling the string within auto as an opportunity. >> you just say hearables. this is literally my favorite product in the world right now, the air pods, which make you look dorky when you put them in, but i don't know if jony was responsible for the design of these, but it's something -- what do you think hearables is going to look like >> i want to do a quick recap of seventh grade biology here is that hearables has a great opportunity around healthcare. specifically your inner ear the skin is actually thin, it's great for picking up bio markers like blood pressure. i think what you a're going to e around hearables is more around healthcare surprisingly. think about air pods that actually insert a little bit further into your ear. why that's important and why i believe that is that this product has not only been a success but obviously apple's comments around healthcare i think you're going to see more around that, more around using voice with hearables, too. they're taking away some of the friction for those of you who use air pods and use your voice, it's sometimes clumsy, but there's opportunities around making that more seamless. >> haven't we been waiting, though, for the voice thing, we have been all waiting for siri to understand us for a long time why are you more convinced no you that they are on their way i will tell you having used the google products, at least on voice, they seem to be ahead of the game. >> i need different sizes. is that jony ive's fault why can't there be a small, medium and large air pod because my blood pressure would be zero because it doesn't stay in my ear. it's not going to work for me. >> let me just quickly talk about voice. this is something that we track closely every six months we ask each of the major ones 800 questions and we've seen siri go from getting 60% of them right up to it's almost 75% correct we will do another one in a month. you're exactly right, andrew, google crushes this, they get almost 90%, 87% of the questions right. google has a distinct advantage in voice the reason why i think there's room for apple to advance around this is they're clearly making progress, they have had some hires obviously around ai from google which i think helps around voice and then, joe, to your comment about these air pods not fitting in your ear, it's about 20% of people have that problem. >> would it kill them to make a small -- no, smaller. >> small. >> it would kill them. >> it would kill them to make a little bit smaller. >> multiple skews, make it harder to make money. >> it's a real problem i walk out of the car over that grate, i mean, it could easily fall you know, they're hard enough to keep track of without them just falling out. >> the request he is would you know what the right size s would you know how to do it until after the second order, would you go ahead and admit it, there was astronauts who would refuse to take the smaller sizes. >> they're not falling out because they're too small, okay, i know that's what you want to say. they're falling out because they're too big. >> when they go in like this and you do this -- >> it comes out. have you not looked up sweat glands, i didn't think there were any in your ear, we have found out there are a lot of sweat glands. >> nasty ones, too. >> nasty ones in your ear. sometimes i dry them and put them back in and they stay. >> i literally leave them in virtually all day unless they run out of battery. >> let me leave you with one thought around design in hearables and wearables. this whole idea this end to end piece it gets talked about a lot, but i think in the midst of looking at growth and some of the criticism around apple's growth, i think these untapped opportunities are massive. healthcare and transportation, two largest ones, i think apple's design team i think the structure is flawed with three people, i think one person will emerge, but ultimately design as a core competency is critical to company, an invest i believe part of the apple story. >> i have one last one for you there was a view when steve jobs passed away at some point people even thought that to some degree jony was the successor of sorts of his is there a successor for tim cook right now >> no. if tim cook -- if this happened and it wasn't jony ive it was tim cook, the stock would be down 25% this would be -- there really is nobody in to fill tim cook's shoes. ultimately there is going to be a da i went he leaves and i'm sure that they will have an orderly succession plan, but that would be -- i have thought about that since last night and that would not be a good thing. >> okay. gene, always good to see you. >> thank you >> thank you, sir. tim is young. >> he is he is. but, you know -- >> you had poor jeannie diamond getting succeeded. >> iger. >> what are you talk being >> we have done huge stories -- >> don't look at me. i remember his contract was up. >> cook is 58 years old. >> i'm just asking the question. >> i'm watching you. >> yeah? >> i'm going to start asking questions about you. >> i know exactly what -- >> great minds. >> do you remember john mclaughlin, the mclaughlin report, he was like 91 and he missed the show on sunday, the first one he ever missed, died that monday. >> that's why you're never quitting. >> got it? 91 >> got luck to you >> take a look at the shares of constellation brands, they are higher. >> our viewers -- >> and then i'm down loading myself through ai, even if it's not me i'm going to be here. they're higher after beating estimates on both the top and bottom lines company gave a better than expected full year forecast. all that despite sliding wine and spirit sales suddenly beer sales are on the rise it goes back and forth >> i think it's like summer driving season where gasoline sales skyrocket in the summertime fourth of july, of course sales are up. >> we could have had -- with the ribs would have been nice. anyway, ceo bill newlands will be on "power lunch" at 2:30 p.m. eastern to discuss the quarter and its investment in cannibis producer canopy growth. coming up, we are going to talk markets, stock market on the final day of trades for the first half of the year already the s&p 500 on pace for its best start in more than 20 years. can it hold the line today looks good to far. and this is tesla's customary time to rush out deliveries as it tries to hit end of quarter targets as the car maker, though, is the right lane as the quarter two moves to quarter three, a live report coming up next stay tuned, you're watching "squawk box" on cnbc there is an ipo on the docket for today right here at the nasdaq on line consignment detail the realreal is selling $300 million worth of stock at $20 each in its ipo. that deal values the realreal at $1.7 billion earlier this morning leslie pick ert joined us, talked about what the realreal is, people buying and selling used high end luxury goods, stuff that costs a lot. got us into a conversation that took us down the rabbit hole about your pants being for sale. >> yes. >> she sent me something, there is used underwear for sale on posh mark, used underwear and used thong underwear i'm looking at it right now, she sent it to me. so your pants might be okay, but this -- >> so someone -- youthought that was suitable for framing, suitable for air, thong underwear is for sale? really >> 6 bucks used. >> can you send me the link? >> sure. >> okay. >> that's an even crazier thought. >> i've tried that, i wear two forward, two back, i wear four thongs. >> full coverage. >> full coverage >> that's a turtle, do you know what the turtle is doing >> yes, i do >> turtles it's the last day of the quarter and that means something important is about to happen at tesla. poor phil. phil joins us now. you are used to it, though, phil, we've been around, we've been together for a while. >> end of the quarter. let's get out sell those teslas i'm waiting for the email to be leaked at some point from a tesla employee saying elon says we can do it, we can hit our goals. the end of the quarter is important for tesla. we have seen the emails already within the last week from elon musk saying that the company can hit record deliveries, potentially, in the second quarter. we'll get the numbers sometime early next week. this is really what wall street is focused on. model 3 driveries, expectation right now is 74,100. model 3s if they hit that, then the number of people think, there is some potential here for the stock to get some momentum next week also next week is when the federal ev tax credit, it gets cut in half again this is the last six months there is going to be any type of tax credit, it drops down to $1,875 ubs out with a note this morning, cutting the price target on tlaesla to $160 as they continue to come down, we still have overall a price target for the -- all the analysts, somewhere around $330. there you see the shares trading at $221. the other story we'll be watching today and this weekend, what is going to be happening with the boeing 737 max. we reported late yesterday afternoon that boeing now says at least in the september time frame, until they get all the fixes done not only mcas, but the latest one discovered by faa test pilots in the last week. you know what that means, if we're looking at september, maybe going into october, airlines aren't going to have this plane back. maybe until the holiday season, and that might be optimistic here is where the u.s. carriers are now, don't be surprised if you see these change by early next week, not just for these airlines but all airlines saying they're not expecting it back until later this year. shares of boeing, guys, i get this question a lot, why is the stock hanging in there in that 350 to 370 range it is going to stay there, unless boeing has to cut production if boeing comes back and says, look, we can't keep making $42 per month on the 737 max, we have to cut production, that's when you see the stock take another step down. >> all right, phil, thank you. we'll be waiting that email too. in the meantime, let's talk markets ahead of the opening bell and final trading day of the year's first half. joining us for that is stan stovall at cfra. it has been a big first half and a big month. we were recording numbers earlier about how dow had its best june since 1938 what does this mean, what do you think? >> i did a little number crunching and went back to world war ii and found that on average the second half of the market goes up about 4% and has risen 69% of the time. but whenever the first half was up by 10% or more, then the frequency of advance went from 69% to 80% and the average price change went from 4% to 7.5%. obviously -- >> the opposite of what you might expect if you're getting big gains in the first half, you might think you pulled it forward. >> momentum begets additiona momentum and the market itself wants to move higher now, of course, you still have the traditionally challenging may through october period, especially july through october following very strong advances on a year to date basis through april. we were the third strongest going back to world war ii history then warned us, be careful, may will probably digest those gains, which it did. look for june to be up because it was up 100% of the time during those five strongest since world war ii now you can add this month to it but then it says be careful, the july through october period is normally down 80% of the time, and we then see a pickup in november and december. >> so that, instead of having sell in may and go away, maybe this is a sell in june and go away >> could be, absolutely. so exclude may, which was down, threw us into another correction, a decline of 5% to 10%, which i call a pullback but, yeah, i think it basically implies that we're not out of the woods just yet the summer winds could be turning into summer head winds and so we have to worry, have we gotten ahead of ourselves in terms of the fed cutting interest rates and the end of july now s&p capital iq is forecasting an earnings recession because second quarter earnings are expected to be down 1.5%, third quarter earnings are expected to be off 0.3%. >> you think that's the case people were thinking we were going to see an earnings recession in the first quarter in the second quarter -- >> it is going to happen one of these days but fool me once, shame on you fool me 29 times, shame on me. in each of the last 29 quarters, the actual results exceeded end of quarter estimates and did so by an average of almost 4 percentage points. >> sam, thank you. great to see you >> my pleasure you too. >> more coming up on "squawk," ready for the final trading day of the quarter and then later on "squawk on the street," don't miss this, an exclusive interview with julie wainwright, the ceo of the realreal company's stock awaits its first public trade i don't know if they're selling used thongz ed thongs or not. that question will get asked the s&p is on pace to finish first half up over 15% after previous double digit gains, the bullish trend i've got the guy responsible for all the errors he's telling me 1928 to the year 2000, is that 72 years old >> that's 72. >> where did you get these facts? >> that's the famous birthdays.com. >> well, we -- we need to talk to "entertainment tonight. you got to get them on the phone and see how they put -- there is an error here somewhere. we got to get this straight. >> other than my marriage i think that's one of my longest relationships was just frightening. celebrating a special anniversary here at "squawk box," the producer you saw with me in that clip, matt greco, is celebrating 20 years at cnbc that's -- >> there he is >> that's the guy that -- >> looks the same. >> that's the guy who does the "friday i'm in love," runs me behind the wheel of that porsche, cursing out the other drivers. that's -- any mistakes you see, that's probably the guy. they're playing it again congratulations, matt greco cooks some mean squirrel too i don't know if you've been. >> i've been to his barbecue he makes great -- all kinds of things. >> happy anniversary. >> why isn't he on camera? >> hiding. >> probably is. >> he's at his desk. >> he's at his desk. does he know this is happening >> surprise. >> anyway, did you see that tie? it looked like a -- used to be in still think i'm wearing bibs. >> pretty much >> i need a bib. especially with those ribs we're up 106 on the dow. weekend is coming. so is july s&p is up 9 and nasdaq up 16 join us next week. thank you. see you next week. "squawk on the street" is up next. >> bye ♪ good morning happy friday welcome to "squawk on the street." i'm sara eisen with wilfred frost and mike santoli jim, carl and david all have the morning off. looking at futures, looks like we're building toward a higher open on wall street. dow up 107 points. s&p up 9 nasdaq up 16 final day of the month of the quarter of the first half of the year, all looking pretty

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