By. 7 the hang sang was up by 2. 1 the shanghai composite up by 2. 1 in europe right now where there is active trading taking place, green arrows across the board. The biggest gainer is the footsy up by. 8 . Quick check on treasury yields which was so closely watched last week when you saw the temporary inversion in the middle of the day between the 10s and the 2s this morning, 1. 618 the two year is 1. 15 so showing more room than we have seen over the last several sessions. We have a huge week ahead for wall street. Kicking off today, big tech executives testifying at ustr hearings then tomorrow, quarterry lults from home depot, kohls and t. J. Maxx wednesday, fed reports on existing home sales plus reports from lowes target and l. Brands and thursday jackson hole symposium kicks off where, of course, Steve Liesman will be. All leading up to fed chair jay powells big speech which will take place on friday but meanwhile, we want to pivot right now to an update on the big story over the weekend, demonstrators in hong kong, tens of thousands of protesters hitting the streets yesterday. Janice mackie friar joins us more with more good morning reporter good morning. It was a show of strength and really being regarded as a measure of the wider Popular Support for the protests here that have now continued over two months organizers figure there were 1. 7 Million People, thats 20 of the population of hong kong, the police estimate a little more conservative around 130,000 people regardless, this was a huge crowd defying a police ban to march as well as heavy rain, and the police for the most part were hands off, werent even seen in the streets. There was this sense that both sides were wanting to take a step back and push reset on this movement after the violence that we saw at hong kong airport last week meanwhile, on the mainland and on chinese social media, the propaganda offensive continues now seeming to focus on multinational corporations and businesses, threatening in particular the big four accounts firms, suggesting that if their employees or executives show any sort of support for this protest movement, that they will be punished alluding to what happened with Cathay Pacific last week showing video of chinese pro military forces have been conducting massive security drills less than 20 miles from here so beijing telegraphing all of the options it says it has before it in order to end these protests, but among them, compromise is not one of them. Janice, appreciate it very much i was curious about what you think the future of the Cathay Pacific situation will be but becky may have a had a question. Go ahead first. On Cathay Pacific, obviously it is going to take on a world of hurt, but in terms of who is running that company now and whether the Chinese Government has real influence over it, what happens . Reporter well, there was the sense that Cathay Pacific and river hog was being pressured by beijing. Either directly or through a major share hoemder after the commotion at hong kong airport, the cancelled flights, the allegations that some employees were heavily involved, beijing at first had banned some of the flight crews from even landing on the mainland because of their suggested involvement. What this has done unofficially is sent a very strong message to a lot of the multinationals here, although so many of them wont go on the record to say so, they are feeling some pressure, this sense that beijing is keeping is close eye and a close ear on this situation, that targeting the big four Accounting Firms was the direct result of an ad that appeared in a local hong kong newspaper last week from employees of some of these firms voicing their support for the protests so beijing over the weekend and particularly on social media came out swinging. Just to add to whats been happening with china, you saw that stocks were up there despite what weve seen with some of these protests and beyond thats because Chinas Central Bank on saturday unveiled a new key Interest Rate reform thats going to be steering borrowing costs lower for companies. People are looking at this as a stealth rate cut if youre watching whats been happening with the markets there today, thats why you see these big gains for both the china markets. President trump and apple ceo tim cook sat down for dinner friday the president s golf club in bed minister, new jersey, about ten minutes from my house. Im sure that could have pulled up another chair i was around if the phone had rang. Literally ten minutes. Any way, president told reporters yesterday that cook made a good case about how a new round of tariffs set to go into effect in september could hit apple products and set the Company Behind in competition with samsung which is a south korean rival its tough for apple to pay tariffs if theyre competing with a very good company thats not. I said, how good a competitor . He said they are a very good competitor so samsung is not paying tariffs because theyre based in a different location, mostly south korea, but theyre based in south korea, and i thought he made a very compelling argument, so im thinking about it. And south korea and the u. S. Struck a trade deal last year that kept tariffs off electronics. Apple relies heavily on production and sales in china. Stock has been on a bit of a roller coaster since the latest tariff announcement on august 1st. Sam sunk captures 23 of Global Market share trailed by huawei and apple according to the latest data. What does he mean when he says hell keep an eye on it either lower the tariffs for china or throw more tariffs to south korea . I dont think you want to we have a trade deal carve out apple in some way that its individualized and special. Then every other worker will come rushing to bed minister to ask the question. Right how do you correct that so tim he didnt check with me either obviously. You think he came back just for this i guess probably. If you can get 00 meeting with the president right now and this is your issue, you make the flight, you take the flight. Morris town probably for tim. They can take pretty big jets in morris they can take the president s jet. Up next, much more from President Trump as his advisers rejected the notion that the economy is in trouble. You think the yield curve could know about some kpoj nis event no. I dont see anything probably not, but what if it does in thats what scares me. How could it possibly know that. I dont know. Wisdom of the crowds. I dont know how it knows that how does when everyone bet on georgetown, how do you know its going to be villanova or something. It happens well talk about the odds of a u. S. Equity futures right now. As we head to break, a look at the biggest premarkets winners and losers in the dow. Welcome back to squawk box. Take a look at u. S. Equity futures this morning because they are surging lets show you whats going on right now. Youre looking right now at the dow up triple digitdigits, 273 s right now. Nasdaq looking to open close to 80 points higher s p 500 looking to open higher as well. Close to 29 points higher. The Economy Taking Center Stage this morning President Trump and his economic advisers pushing back on the idea of a looming u. S. Recession, a threat that sent shock waves across wall street last week and pushed the 30year treasury yield to its lowest level ever i dont think were having a recession. Were doing tremendously well. Our consumers are rich i gave a tremendous tax cut, and theyre loaded up with money theyre buying i saw the walmart numbers they were through the roof. I sure dont see a recession. We had some block buster retail sales consumer numbers towards the back end of last week. We have the strongest economy in the world money is coming here for our stock market, its also coming here to chase yield in our bond market joining us now, alec young, managing director of Global Markets research at ftsc russell and kevin yaman. Very popular in jamaica cool running. Ill start with you, kevin yes. That was the story last week. And i was just positing whether theres something we dont know. 18 months is a long time given the current economic forecast, a recession looks really unlikely. Yeah. Im just wondering is there any way a yield curve could actually know something that we just dont know . You never know what you dont know or could we say its different this time and probably not likely to be correct i dont think you can entirely ignore the yield curve inversion but record low unemployment numbers, moderately rising wages, confident consumer that continues to spend, the fact that the tax cuts will stay through the end of last year, more relaxed Regulatory Environment that should bode well with the stocks and more dovish leaning Federal Reserve, there are opportunities there. I think the bond market is telling us they would like to see rates lower. I dont know if they necessarily need to be. You can think of so many and i use the term exoj nis events oil shock or something in hong kong 1. 7 Million People thats hard to put the things back in whats starting to happen there yep. I dont think it could be that smart, but then it just makes me wonder, we have 18 months is such a long time, especially with the news cycles we have now, i dont know how you can say that we know there wont be. Theres a lot of risk still throughout. There are things that are pushing the yields down and flattening the yield curve. That have nothing to do with the economy. With our economy. Global savings glut. Its weird you hate to say this time is different, but there are some pretty unprecedented things going on people are talking about negative rates here eventually that seems like a stretch because of the strength of our consumer were in this weird world where we have ultra low rates. Rates are collapsing but our economy is healthy. Brian moynihan spoke last week and said that he didnt see anything out there, bank of america has one out of every two households in t United States and usually banks can see it out by about 18 months. From an equity perspective, theres a couple things you can take from that number one, its encouraging it means the market doesnt fall at a bad, dips get bought. Until trade gets resolved. Youre not that bullish. No. Were bouncing around. Im glad that the strong consumer keeps us out of a major draw down, but right now Earnings Growth as you know is low single digit the street is at 11 for 20 over 19 my side people look at that number and say well be lucky if thats five. Until trade, until you get rid of the current tariffs and agree not to slap new ones on left and right. Even with what walmart said the markets doesnt make new highs. Well bounce around. I was surprised that walmart would really go out the market is differentiates the consumer games are rocking and rolling. The globally hurt names are in the tank theres huge swaths of the market that are a train wreck energy and probably value there but financials, most pharma, its very by fur indicated. Do you think its tough to do double digit earnings return its a very positive environment for u. S. Companies, maybe globally not so much, but in terms of unemployment and gdp. Back to 2018, joe, we had two consecutive quarters of corporate growth more than 20 were not going to get back to those levels were slowing but growing environment. We have a lot of geopolitical risks. Boris johnson having to navigate a tough Brexit Merkel is not going to rerun. Stood in front of those tanks or something. Other thing thats interesting is that obviously well hear from the ecb this week but the market is betting a lot on the fed and easy money and you have to wonder the cost of capital is record low, so is the fed cutting rates really going to stimulate cap x and Business Investment which is the weak spot of the economy i kind of question that a little bit. Why are stocks moving up so sharply today . Peter shack says he thinks its because yields are firming up. That makes as much sense as anything else to me. I think its a reminder of how strong the underlying economy is at this point and moving eight bases points from a yield inversion is a lot of confidence. In hong kong there was no violence the market here is taking its cue from over there but a big relief rally at least it wasnt Chinas Central Bank, too, the rally in chinese stocks. Yeah. I think that tweak theyre making to their lending. Yeah. Helpful. So, you think 5 year over year is good as were going to do for earnings . I think thats i think thats constructive as well. I think were going to have a strong Third Quarter i think Holiday Shopping sales will be strong i think the online commerce segment of retail spending will continue to grow. What will 18 months of no recession, that will put the life of this expansion everyday is a record, right . I wouldnt be surprised to see us hit all time highs again. The only problem with the expansion is long in the tooth thats why its not so fun. What happens is people keep second guessing it people bet on meaner versions. I think theres a good chance it lasts a lot longer, but people i think will continue to second guess it the problem i have with stocks here is just if were in a 5 Earnings Growth environment, were fully valued at 17 times youre not going to get a 20 multiple on the russell at least 8, 9, 10 . If i was a worrywart, i would say were long in the tooth, got the yield curve and Start Talking about iran, north korea, china, hong kong i can give you im so worried about so many things that in 18 months i have no idea, we never know forgot about afghanistan. Over in russia they have these stations that measure radio activity they like turn them off. Yeah. When that happens. Right what oh, no, were not registering anything you turned your stations i just anything can happen right . We have a pretty big election next fall as well. That might be it. Biden warren thats my new pick sorkin. I think its a little that will be big but its a little early for the market to be trading too much on that because we dont know enough about it. Trump wasnt expected to be anywhere near the victory taking a victory lap at this point before. But historically six months, eight months prior to an election, cap x, think cap x isnt going in the right direction already, it goes down materially. Because you wait to see what happens. I cant do anything. Biden warren the closer biden and warren get to if white house. Think about it for the economy, thats like add all those things i said together thats the sum of all fears if those two get in seriously. Think if warren got closer, you would have a different situation. She would take veep and then he goes one term right . I have no under your scenario, maybe. I dont know one thing thats interesting i have seen a lot of polling investors overwhelmingly see trump reelected. As of today they do. Its 5340 with i like where they come out and say, 50 didnt like his response to the shootings. He said investors. I know. Oh, investors. 50 hate him no matter what 50 . Im talking about Portfolio Managers. Those greedy, all they think about is their pocketbook. We dont want i dont want to give them credit for that. Any way, thank you when we come back, the biggest water cooler stories of the world of business. Well talk about teslas new solar power push and bourbon backlash both those stories right after this dear tech, lets talk. We have a pretty good relationship. Youve done a lot of good for the world. But i feel like you have the potential to do so much more. Can we build ai without bias . How do we bake security into everything we do . We need tech that helps people understand each other. That understands my business. Weve got some work to do. And we need your help. We need your support. Lets expect more from technology. Lets put smart to work. You should be mad at leaf blowers. [beep] you should be mad your neighbor always wants to hang out. And you should be mad your smart fridge is unnecessarily complicated. But youre not mad, because you have e trade which isnt complicated. Their tools make trading quicker and simpler. So you can take on the markets with confidence. Dont get mad. Get e trade and start trading today. Dont get mad. carrying up to 50 times its tbody weight. Essly marches on. It never questions the tasks at hand. But this year, theres a more thrilling path to follow. father kids. Change of plans vo defy the laws of human nature. At the summer of audi sales event get exceptional offers now welcome back to squawk box. We are in the chairs this morning, tesla relaunching its Solar Panel Business by letting customers rent, can you believe this, rent rooftop systems. What . Homeowners in california, arizona, connecticut, massachusetts, new jersey and new mexico, thats the list, will be able to rent the solar Power Systems for between 50 and 65 per month. But if you decide against keeping the system, it costs 1,500 to remove the panels and restore your roof. Thats a total ripoff. Its a beautiful roof its unlike the sort of solar panel roofs. Why are they letting you rent them are they having trouble selling them to people well rent them to you because we have this stuff sitting around and we need more customers . You pay monthly for everything, wework, solar, its supposed to be cheaper eventually than electricity. Its like rentacenter you pay off your couch 20 years later. I know they struggled to get the technology right on all of these roofs because remember about year and a half ago they showed these beautiful, beautiful videos when elon musk was demonstrating this stuff and they have not hit the market. This may be it. Just so you can have the burbs. So you can have a roof, so you can solar power it and feel really good and feel virtue s. I have a generac. With climate change, you need one. Can the roof also power a generac . I would worry about any time you need i dont know shes got a wind powered car no, i dont. You dream of one still. The leaders, this is a