75, 52-week highs, including stocks like alphabet, which we'll hear from later in the week. >> and including stocks like apple, which of course is in the dow. you take a look. apple gets bad-mouthed a lot. they haven't had the best run over the last several months, but looking at the past month, it's about the fourth best performer on the dow, up better than 4%. it's doing okay today as well and just about at 52-week highs. so despite the headlines about, oh, it's over for apple, you know, whatever, peter i guess can't be right about everything every single day, at least not in terms of apple's moves in the dow. >> well, there's been so much focus today on materials and infrastructure, but tech is actually the second best performing sector this year, second to materials, but there's this sense in the market from traders that tech is the backbone of any infrastructure building that we could possibly get, perhaps besides roads and highway, and there is a question of which companies will stand to benefit when you redo bridges and you overhaul all of these systems that have been in place for decades at this point. >> basic resources a big winner today, and we are expecting some executive orders, one of them perhaps involving the direction of funding for a border wall. we mentioned our own bob pisani on this historic day. bob, your thoughts as you watch this from afar, both in terms of breadth, volume, and now durability. >> yeah. good morning, carl. i'm still at the etf.com conference in boca raton, just outside of boca, down actually in hollywood. so, a lot of participants here just marveling at how much the trading world has changed in the, oh, eight or nine years since the dow crossed over 10,000 decisively. the etf business was below $1 trillion. now it's $2.5 trillion business. and the way we trade, much more electronic trading. so a lot of people talking about how things are different. i think what's important now is that we're starting to see some action. so remember, the rally stalled because we didn't have much in the way of details on tax cuts, infrastructure spending, less regulations. we're not sure how much would actually materialize of those promises, and we weren't sure how much would be 2017 or 2018 events. but now we've seen in the last 24 hours some executive orders, all right? it's small, but it's pipelines, there's some action. even more talk about the wall being built. i saw notes this morning from the analyst community crunching numbers. i saw cement analysts crunching numbers on cement production and the wall and how that might influence cement production nationwide. so i think all of this is really having an influence on why we've crossed over 20,000. we also have speaker ryan implying maybe a somewhat more aggressive schedule for tax reform. so, that's what the market's been waiting for, a little bit more clarity. and i think that's the reason we've clearly moved over 20,000 now. >> not so much discussion today, bob, about inflation or the fed being behind the curve or trade wars with china. i mean, it is being discussed, but clearly, other animal spirits, or at least reaction to the quarter from earnings is outweighing that. >> yeah. and i haven't seen the earnings today since i've been down at this conference, but there have been a number of comments in the last week or so from companies that while they're not giving numbers and saying we're going -- earnings are going to go up 10% to 15%, they have clearly implied that particularly lower tax rates, and in some cases, infrastructure would be beneficial to them. i think the problem the market also had is the initial focus on obamacare and on potential trade issues and trade wars. the market perceived to be somewhat of a quagmire. and i think there was a little concern there that they were going to get bogged down. now they can see that they can tackle several issues at once, including things like pipelines and the wall and the implications of that. and i think the market's taking some heart here. the one thing i would like to see in 2017 personally, myself, would be some expansion of stock ownership. you know, gallup did a poll that the lowest percentage of households own stock, the lowest since they started doing this two decades ago. 82% of all stock in the u.s. is controlled by the top 10% of households by wealth. that's a very, very sad number. we're essentially talking about 10% of the households reaping the benefits of one of the greatest bull markets of all time. i would love it -- i think it would be a significant victory if we'd see some more people buying into the stock and bond market in 2017 and betting on america, betting on their economic future. heaven knows, the rest of the 90% could use some stocks in their portfolio. >> yeah. as cashin said to us earlier, bob, dow 20k will be on the front page of every paper tomorrow. maybe that brings some retail money in and you will be watching for inflows, i know you will be. good talking to you. >> thank you. have a good day. >> bob pisani. joining us to talk more on market, ed cowen. we thought there would be a ceiling of sorts at 20k, it would retreat because of money piling into short bets and etfs for tail risk. what does it mean that we've pierced it and kept going? >> well, i think the basic logic is the fundamentals are still there. so, earnings are growing. we think at the end of the year they'll grow by 6% or 8% or so. as long as the fundamental story is positive and supportive, i think we'll continue to trend higher. >> and what do you see the fundamental story being? because this morning jim cramer is saying it's all about earnings. but then you look at the conversation in washington and it's all about infrastructure and the republican lawmakers going on their retreat in philly today. what do you think is actually driving the conversation? >> well, in the long run, stocks are always driven by earnings. and after having a couple years of weak earnings growth, now we're going to get pretty good earnings growth this year, we think 6% to 8%. so policy matters, of course, and even the psychology of hitting down 20,000. i think the points bob pisani just made about maybe getting people more excited about participating in the growth of the country through the stock market. i think that all helps. so i think it's a combination of the fundamentals are quite strong in terms of earnings growth, and then if you get supportive policy and maybe a little bit better psychology, which seems to be the case based on the polls, i think that bodes well for the market this year. >> ed, last hour we had goldman's chief investment officer of their private wealth management group, and she said that she basically sees a 100% chance of a 5% down draft in the market, 60% chance of a correction, 10% down draft. given the fact that so many retail investors, mom-and-pop at home have not participated in this rally, is now really the time to get in? >> listen, pullbacks in the market are the nature of the market. the stock market is risky. it always has been. it always will be. if you're afraid that you might invest today and the market might be down 10% two weeks from now, you'll never get into the stock market because there's nobody that can guarantee you that you won't have a drop at any time. that said, if you look at the long history going back in some cases hundreds of years across stock markets in a lot of different countries, you tend to, although you get those downs every once in a while, and some can be quite scary, the overall trend continues to be up. so i think if we look at this year, i think it's unlikely we'll go into recession. i think we'll get a little higher inflation. we'll probably worry about the fed more as time goes on. there are plenty of things around the world to worry about. but with the support of earnings growth and perhaps more supportive policy, i still think this is a pretty good time to be invested in equities. >> ed, what is the impact, though, of the potential down side of some of the policy that we could see in the coming months? because what the market seems to be trading on is the promise and the positives, but then you think about the fact that there will have to be private money that is participating in an infrastructure program, that a tax program will potentially not be revenue-neutral. then you think about the fact that we're just weeks away from hitting $20 trillion in government debt. will any of those factors sink into the market in the near term? >> in my view, the level of overall debt is really not an issue. we still have plenty of opportunity. if you look at it this way, you just hit 2.5% on the 10-year bond. if the overall level of debt was too high, interest rates would be much higher than that. so i don't think that's a huge issue. and the level of the deficit relative to size of our economy is still quite manageable. so i think the most important thing to pass on to our children is not the debt per se, but the strongest possible country we have. and if we have to take some debt in order to make the country stronger, i think that's a negative positive. >> so you don't think that the yield on treasuries is driven primarily by what's going on outside the u.s.? you think that it is basically u.s. investors being relatively placated by the level of debt we have? >> no, it's always driven by a lot of different factors, and there clearly is high demand for u.s. debt from outside as well as inside the united states. so my point is that if the debt level is too high, if there was too much debt in the world, you would expect interest rates to be higher, not still fairly close to all-time lows. so, there's still very strong demand for u.s. paper. and as long as there is, that means that the united states will be able to borrow money relatively cheaply, and to the extent we can put it to good work, whether it's in infrastructure or by giving money back to the people through tax cuts to me that's a good use of capital. >> although just to put a point on kayla's point, ed, i mean, foreign holdings of treasuries is coming down as rates are going up. you don't see any risk in that? >> well, again, there's always risk in the market, but there's still very strong overall demand, both in the u.s. and around the world. some other countries have had to pull back as a result of the drop in oil, for example, but there's still quite strong demand for u.s. treasuries. that's why the rates are so low. so again, there is always risk. i don't want to dismiss that. but i think the market tells you through the interest rate that there's still stronger demand than supply. and i think if we could get -- i do think rates will continue to rise this year because i think inflation will rise as a function of better growth, but i still think rates will stay pretty low by historical standards. and again, if you can put money to work that's profitable at 2% to 3% on the 10-year, i think that's a wise thing to do. >> all right, we'll leave it there for now. ed, good to see you. >> good to ee you. >> ed keon joining us on "squawk alley" this morning. when we come back, if you're just joining us today, the dow hitting 20,000 for the first time ever. more on where you should be putting your money. take a look at the two biggest movers this morning pushing the dow upward. one is boeing, which reported better-than-expected earnings today, and then ibm up for five straight days, a 2 1/2-year high on big blue. "squawk alley" will be back after this. dow 20k today. get a check on one particular down mover this morning. diana olick will look at what depot is up to on this historic day. good morning, diana. >> good morning, carl. home improvement giant home depot has been a leader on this rally, on an absolute tear since 2009, not despite the epic housing crash, but likely because of it. take a look. it's up over 400% since the dow crossed 10,000. so, what fueled the gains? well, just think about what happened during the foreclosure crisis. first, millions of homes were either taken back by the banks or abandoned by owners who could no longer pay. they fell into disrepair quickly, entire neighborhoods, in fact. then just as quickly, investors moved in, buying homes and doing mostly repairs and rehabs, not major renovations, but the kind of fixes that home depot products fuel, and that was the first surge. but then negative equity, which hit millions of owner occupants, kept those homeowners in place. they couldn't move without taking a loss. and when you don't move, you renovate, you fix, you upgrade. again, home depot's sweet spot. even now, as homeowners stay in place longer but millennials start to buy, demand for remodeling product is still strong. as millions of homeowners regain equity amid rising home prices, they're upgrading appliances, fixtures, all kinds of systems. again, home depot. back to you guys. >> all right. thanks so much, diana olick. as we head to a quick break, check out where the market is in particularly shares of seagate technology. the stock currently up 21%. the s&p also joining the dow today at record highs. much more "squawk alley" ahead. stay with us. the dow crossing 20k this morning, four trading days into president trump's term. all the indices hitting fresh all-time highs. is this going to hold or could we see volatility up ahead? bob pavlic is a chief market strategist, sam stovall, and brian jacobson from wells fargo joins us in milwaukee. guys, good morning to all of you. let me turn to you, sam. at a t? is something going on? does retail start to flow? what happens next? >> we're certainly seeing a tailwind for investors. we're in a good seasonal period, november through april, good earnings numbers coming out. people are expecting instead of just a 4.2 starting point, maybe we see earnings up almost 8% for this fourth quarter. and then, obviously, the optimism associated with a new administration. so we've gone two millennial levels on the dow without resetting the dials, and we're not going to get away from it that easily. >> people keep saying it's a good time to be invested. is it a good time to get invested? >> i think if you're not invested, you just wait. i think the market will probably present a better buying opportunity. we're trading over 17 times the current earnings estimate, which is forecasting 12% growth. 12% growth not including any of the trump initiatives. i think that number may be a little too aggressive right here right now. you get some of the trump initiatives pushed through -- tax repatriation, money coming back from overseas, some infrastructure plans actually coming into play, then that 12% is probably going to be too low, but we haven't gotten there yet. >> so, brian, if this is not the buying opportunity, will there be a pullback ahead that investors can buy into? and if so, what do you think will be the cause of it? >> yeah, i don't want to sound like a party pooper too much, especially on such an exciting day, but i do think there will be a slightly better buying opportunity. i'm anticipating maybe a 3% to 4% pullback as people maybe get disappointed as far as the time frame for when some of the trump administration's proposals actually can make their way through congress. i am expecting that we'll see some movement on corporate tax front. i hope to see that within the first 100 days, but if there's any whiff that there's going to be a delay or anything along those lines, it could easily take the wind out of the sails here. but i do think by the end of the year, at some point we'll probably be closer to dow 23,000 than dow 20,000, so maybe they could be a good opportunity for hat manufacturers as they have to make new ones. >> i think brian makes a pretty good point. the market could actually just consolidate at these levels before actually moving higher. it doesn't necessarily have to sell off. i am forecasting a little bit of a pullback, but i think it actually can just consolidate these levels. we get some time to pass, we get some trump initiatives actually starting to take hold, and then we start to move higher. i think the chances of that are still relatively low, though. >> sam, let me get a little nitty gritty. there's a record amount, at least in terms of retail investors, of investors on the sidelines here. maybe they've got a pot of cash that they're looking to perhaps get into the stock market. how would you do that if you are looking, either now or months from now, at getting that money in? do you put it all in at once? do you have a certain kind of mind-set in how you go about it? >> well, i think first off, you revisit where your allocation should be based on your time horizon risk tolerance. you definitely don't want to be chasing the market well beyond what you should be doing. right now when you look at a target date fund that is geared toward somebody who's going to retire in 2040, maybe you have 75% equities. well, the top five have something closer to 90% equities, and that's what happened to us in 2007. we were just too far out on the risk curve. so i would say, yeah, you're better off probably going in now, not just going in little by little, but i would focus on quality, focus on those companies that have consistently raised earnings and dividends over time and that you're not overpaying for some big yield play. >> brian, this morning peter navarro on our show, "squawk box," of course, national trade council chief, argues, "we envision a more german-style economy where 20% of our workforce is in manufacturing, and we're not talking about banging tin in the back room." how much can we bring manufacturing in terms of to the overall labor force? >> yeah, i'm not sure if i would want an economy that looks like that. i mean, over time you typically get more people working in the service sector. even all the talk around the demise of the manufacturing sector. you know, manufacturing output's at record highs. manufacturing employment continues to trend down. but part of that is just because if you think about even just outsourcing, domestic outsourcing, people who used to be considered working for a manufacturing firm in accounting. well, now if they're working for a consulting firm or some outsourced firm, they're not included in the manufacturing numbers. so i think some of this might just be a little bit of kind of, you know, the kind of manufacturing on the employment side is what we used to consider manufacturing jobs just aren't that way anymore. so i'm not sure that's a goal i would necessarily rally too much behind. i mean, you could easily say that with the increase in output of manufacturing in the united states has been due to automation, not necessarily due to, you know, competition with other countries. but a lot of jobs that are going to come back in manufacturing are going to look very different than the ones that left. >> same thing for the new jobs that are created, too, but is there a way to play the re-education of the american employee, bob? because most of this is a hyperlocal community college story. >> yeah, i'm not really quite interested in playing the re-education of the current workers, but what i am interested in is the growth that's going to most likely develop if we do get these initiatives passed. so i really do want to be focused on cyclicals, things like energy, basic material, the industrials, financials, technology. i think these are the areas that are going to continue to sort of power the market forward. in fact, i'm carrying, you know, 2,485 for the s&p this year. so though we may get a pullback, i think it will be a buying opportunity and you move forward off of that. >> one more question on target, sam, because you were disciplined in raising your targets as the market grew over the last few years. what's your right now? >> right now it's less than bob's, at 2,335. our execution when you look at both earnings growth expectations as well as inflation, because you really have to look the at tat the twor with expectations inflation goes up to 2.3%, i think you are maybe in the mid-2,300 area, so it's low single digits right now. i think we're borrowing from the future. >> guys, we're going to see. interesting day, though, nonetheless. bob, sam, brian, thank you so much. >> you're welcome. and when we come back, the trump rally expected to roll on. but meanwhile, also the president expected to sign more executive orders today. how's the market going to absorb some of these policies? we're going to speak with former labor secret robert reich and a former member of the council of economic advisers under president bush, matthew slaughter. much more ahead on "squawk alley." stay with us. we're drowning in information. where, in all of this, is the stuff that matters? the stakes are so high, your finances, your future. how do you solve this? you don't. you partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. morgan stanley. good morning once again, everybody. i'm sue herera. here is your "cnbc news update" at this hour. at least 28 people were killed, 43 injured as somali security forces ended a siege by extremist fighters who stormed a hotel in the capital. four al shabaab attackers were among those killed. the assault on the hotel started when a suicide bomber exploded at its gates. former south carolina governor nikki haley has been sworn in as u.s. ambassador to the united nations. vice president mike pence swearing in haley. the senate voted 96-4 tuesday in favor of her nomination. at least seven protesters climbing a crane at a downtown washington construction site just a few blocks from the white house. they unfurled a banner that said "resist, green peace." and hollywood actor arnold schwarzenegger attending the pope's audience at the vatican. he listened from the front row as the pope blessed the audience, but they say they were not expected to meet privately. that is the "cnbc news update" this hour. back downtown. carl, back to you. >> sue, quite a day around here, as you know. dow 20k, not a bad session in europe or asia as well. seema mody? >> that's right, carl. as president trump makes good on his campaign promises in the first week, risk sentiment is improving not just in the u.s. but around the world. european stocks on the rise, thanks in part to upbeat earnings. we're currently seeing the german dax trade at a 15-month high and outperforming the s&p 500 so far this year. and even in the uk stocks on the rides, despite the supreme court ruling yesterday, which of course could elongate the overall brexit process. miners getting a bid on higher commodity prices, that as well helping the ftse 100 outperform. banks rallying, getting a lift from banco santander, which posted a profit above a year-ago levels, helped by higher fees and stronger than expected income. remember, these banks were under immense pressure in 2016. other european banks joining the rally, including deutsche bank, soc gen, bnp paribas and commercebank. and this is in the face of hawkish comments coming from the ecb board member, saying inflation is improving in europe and therefore it may be time to exit the ecb's qe plan, but the euro gained a bit of ground, 1.07 against the u.s. dollar. again, stocks in europe on the rise. just to point to reiterate that, this trump not just a u.s. story but something across the world. europe markets up higher. >> thank you, seema. a lot to talk about. investors looking with some optimism to the new administration as the dow does hit 20k, as the president pushes forward with executive orders. more expected this afternoon. joining us this morning, robert reich, professor of public policy at uc berkeley, former secretary of labor under bill clinton. and matthew slaughter, dean of the tufts school of business, former member of the council of economic advisers under president bush. gentlemen, good to have you back. mr. secretary, we don't normally talk equity markets with you. it's more about employment. but kellyanne conway this morning retweets a post about dow 20k. she calls it the trump effect. do you go along with that? >> well, in the short term, you can't argue with what the markets are doing. the question is what's going to happen a month or two from now. i don't think this rally is going to continue. and here's why i don't think so. number one, donald trump is treating the world economy as a zero sum game. the assumption being make america first, we win or they win. he's talking down nato, the european community. he's making it seem as if trade is really bad for the united states, and therefore, we are going to put up trade barriers. this is not the kind of talk that will inspire confidence in global markets. and so, i don't think this so-called rally, this trump rally, is going to continue much longer. >> but at least it's inspiring optimism in the stocks of many of these u.s. companies, notably manufacturers. but matthew, i wonder what you think the cost of protectionism truly is to the market and at what point it will factor in. >> great question. i think the markets right now are pricing in a lot of optimism and hope that business tax reform, which is something the new administration and congress have been talking about, will be a major policy initiative. that would clearly support the creation of good jobs and good wages in america, if done well. the question of trade protection is a big question mark that a lot of people are wondering about still. so, starting a trade war, which many have voiced concerns about, would be very damaging to american manufacturing and a lot of globally connected services companies as well. so, i think there's a lot of hope that won't happen, but the devil will be in the details on policy proposals. >> secretary, what's your take on the impacts to the american worker in just the first couple days of moves out of president trump that we've seen? on one hand, you've got the america first position, a move away from tpp, as expected, which many people think is good for the american worker. on the other hand, this risk of a trade war, which you have just said you expect to drag down everybody. what's your take? >> well, the american worker will benefit if certain things are done in terms of -- like an infrastructure project. i think a big infrastructure program not only is good for the economy and good for america in terms of all of the deferred maintenance on so many of our roads and bridges and tunnels and also public transit, but also would generate a lot of jobs and have a big multiplier effect. so i am all in favor of that, if that happens, but we know that shovel-ready projects are not that easily identified. we went through that in 2008. so, let's see. in terms of other issues, mr. trump, president trump doesn't want to raise the minimum wage. he doesn't want to continue with the president's -- president obama's order with regard to overtime workers and the overtime threshold that the labor department has. he is anti labor unions. andrew puzner, who he wants to be his labor secretary, is very, very antiall of worker legislation of a lot of unions. i don't personally think that's good for american workers. i don't think that's going to create good jobs. we have relatively, in fact, quite low unemployment right now, not very much slack in labor markets. so i think the real issue for american workers is not so much the number of jobs, it's the quality of jobs and, obviously, wages. and i don't think anything that donald trump is contemplating is going to improve wages. >> mr. secretary, when we get this first jobs number under the new administration, do you take the unemployment rate for what it is, for what it says? >> no, no, not directly. the unemployment rate is a good relative gauge of where we've been and where we are right now. but obviously, you've also got to look at labor participation rates. and labor participation rates have not been great for the last several years. so there are a lot of people out there, presumably, who are too discouraged to look for work, but we don't know exactly why. that's a big, big question mark hanging over the economy. >> but matthew, when the president says that he will create 25 million jobs, is that possible, given how our labor force looks right now? >> well, we should all start by recognizing, it's quite clear that what ultimately drives the number of jobs has a lot to do with just the number of people in the population. and as bob rightly pointed out, the labor force participation rate. so there's a deep set of issues that congress and the president have only some control over that, such as demographics. but bob's exactly right. i think the big issue that we all need to think about, whatever the political party one's a member of, is how does america create good jobs and good wages? and the big challenge i think is to find a way to create more jobs that are connected to the global economy. research and historical evidence show very clearly the high-quality, high-paying jobs in america tend to be the ones where the companies involved are connected to the global economy through international trade, through investment, through high-skilled immigration. and so, choices like killing the tpp is actually a step in the wrong direction for american workers and the broader u.s. economy. so we're going to need to find a way to create those good jobs connected to the world. infrastructure investment's one way to support it, but we need to have a whole constellation of policies to do that right. >> and if i may add to -- >> secretary, you mentioned the issue of shovel-ready infrastructure projects. i wonder if you can talk about shovel-ready brains, in effect, for the information economy. what should this administration be doing to get the workforce ready to do different kinds of work that perhaps will have more legs than the construction-type work from infrastructure projects? >> well, there's several things that the administration could do. i haven't heard donald trump talk about any of these things. but number one, lift all of our educational institutions, right? from preschool all the way through college to world-class standards. make all of them accessible and affordable, particularly higher education. and also, eliminate, finally, the conceit that in order to have a good job in the united states you have to have a four-year college degree. we need to have a first-class, a world-class system of technical and vocational education. we don't have that. germany does, for example. somebody earlier on your program was talking about german manufacturing. well, one of the reasons germany does so well relative to america with regard to high-wage jobs, including manufacturing jobs, is its system of technical education, which we don't have in this country and we do desperately need. >> indeed. i think it was jsamuelson the past few days saying all of these productivity issues are second-order problems to the more deep-seeded problems we have in terms of education. we're going to find out more about that as the administration gets their legs. one more thing here, matthew. when you see the president and, say, mick mulvaney at omb ostensibly collide on entitlement reform, or when you hear the president and mnuchin at treasury collide over strong dollar policy, how are we supposed to know whose view is the strongest? do we default to the president? >> that's a great question. i think the new team of leaders along with the president is sorting out their individual and the policy priorities overall. i think it comes back to a theme we've been talking about in this conversation, which is there's an aspiration widely shared to create those good jobs at good wages, and some policy lovers you can pull and they have an immediate effect and some the clock ticks more decade by decade or generation by generation. so making efforts to reform the education system, as bob pointed out, is very important, especially early childhood education. i think there's a growing amount of evidence that shows what happens in those early years in the home and early in school is so vital. i'll add one other one, which is really important to consider when you think about skills, which is immigration reform, especially high-skilled immigration reform. there are hundreds of thousands of talented foreign-born nationals in places like bob's school at uc berkeley, here at the tuck school at dartmouth, that would love to create new companies and have their patents be created and add new jobs in america. and yet, we have a highly restrictive immigration policy that makes it hard for many of them to do that. so, i think the challenge from the new administration and congress is going to be to think about what policies can reasonably be enacted this year that will have some impact and what sort of investment policies do we need to make that will hopefully pay it over many years. >> mr. secretary, matthew, it's good to have you both. we hope you'll come back again and again. thanks so much. >> thanks very much. >> thanks very much. >> dow's up 127. some of the biggest movers that helped push the dow over the edge -- boeing, which accounts for about a third of the dow's gain today, along with ibm, 3m and caterpillar, all contributing double-digit point gains. a lot more ahead on "squawk alley." stay with us. coming up on "the halftime report," a debate about what you should do with your money now that the dow has crossed the 20,000 barrier. plus, what can president trump do to lift stocks even higher from here? and we'll hit many of the stocks propelling the nasdaq to record highs today, including apple, microsoft, google, yahoo! all "halftime," top of the hour, jon. see you in about 15. >> all right, sounds good, scott. let's send it over now to the nasdaq. bertha coombs standing by. bertha? >> hey, jon. the nasdaq 100 is actually the market's biggest out-performer year to date with big-cap techs like alphabet, microsoft' done and broadcom all hitting fresh all-time highs. but with the president's emphasis on america first, when it comes to business incentives, small caps have outperformed the major averages looking back to the election with their u.s.-focused companies for the most part. it was in the nasdaq universe. large-cap tech is last and surpassed small caps year to date and the biggest reason why is the uncertainty over biotech. the nasdaq biotech index surged following the election, if you'll recall, but it's become a drag of late with uncertainty over drug price negotiation policies. it's one health care issue, one which democrats may be willing to work with president trump amidst the repeal of obamacare. and fundamentals have also been weighing on some of the biggest losers, like regeneron, down 14% so far this year. the cholesterol drug blocked from the market after a court ruling. mylan with epp pen dropping the price there. that said, you have some winner easy in biotech. vertex pharma, illumina. and some hitting a new high. >> thank you, bertha. meanwhile, a trifecta of highs for the market today. the dow cracking 20k, while the s&p 500 and nasdaq are at record highs, thanks in part to leadership from tech stocks, including apple. eric hippo, managing partner, joins us here at post 9 with the back drop of all that. welcome. thanks for being with us. >> my pleasure. >> so, eb dynamics about to go public, was snatched up by cisco for about twice the expected market valuation. i guess that's not a bad thing. but given there's been a couple of months for the concept of a trump presidency and his policies to sink in, how are you feeling as far as tech investment and the environment for not just ipos but companies that have the prospect of going public? >> i'm feeling very good. i think the almost ipo demonstrated there's a pent-up demand for technology ipos, at least from my perspective. and there's a whole long line of other companies, including snap, which is first to come out in march or april, which would make very exciting ipos, both on the consumer side and the enterprise software side. >> when you look at the uncertainty around the global regulatory environment, there have been a lot of issues with the cloud, what governments have access to data, where the data needs to be domiciled. does that affect the types of companies that you look to invest in or how much money they're going to need in order to be successful if they're playing in that kind of an area? >> no, it doesn't really, because the cloud is, everything is moving to the cloud, will continue to move to the cloud. i think it is proper there should be regulations around data and privacy, a big concern among both companies and consumers, but that should not stop the onslaught of moves to the cloud. >> earlier this morning, cisco's ceo, chuck robbins, was on cnbc, and he said that tax reform not only is a good thing, but will lead to more m&a, potentially more stock buybacks, dividend increases. ultimately, that's good for companies and people who hold those stocks, but what's the likelihood that that activity draws scrutiny? >> the stock buybacks? i think as you see, there's already been a lot of stock buybacks in the past couple years on the part of all kinds of cash-rich companies, including the tech companies that didn't used to do it, started to do it a couple years ago. so, i think if we bring back a couple trillion dollars worth of money that's just parked outside, not doing very much, it will spur not only more potential buybacks but also a lot more investing in the united states. >> you know, a lot was made during the campaign about tech's aversion to trump and his policies, the rift between silicon valley and the trump campaign, at least. is that warming because of things like repatriation, the possibility of bringing all that money home? >> it should. i'm not sure it is yet. >> okay. >> i think silicon valley is still like in a little bit of a bubble, you know. they're still kind of in the opposition. and individually, people should feel the way they should feel, there's no question, but companies have a responsibility to work with any administration, including this one, particularly when it comes to regulations, immigration, which is a huge topic for us in technology. silicon valley has to engage. they can't just stay and live in their own little world. >> yeah. you've seen kara swisher with her piece this past week arguing that tech should sort of be like jobs would have done, maybe just being a pain in the butt. >> i don't see how this is going to advance anyone's cause. i mean, maybe people will feel better individually, but it's certainly not going to help their companies or the shareholders in those companies. >> when it comes to infrastructure spending, given that we're in the age of the internet of things it seems that there's a big potential for tech to get a piece of that, making the argument that if you build sensors into these bridges, these roads, the maintenance costs will be a lot lower. do you get the sense that tech is ready to make that pitch and that the trump administration is maybe ready to listen? >> well, that's my concern. my concern is that tech is still taking this kind of opposition view of the trump administration as opposed to engaging and showing exactly what you're describing, which is, it's not just building bridges or repairing our roads, whatever. we've got to put tech everywhere in order for society to work much better. >> as you're talking, guys, mark cuban tweeting -- "with all the dramatic changes coming in transportation, infrastructure dollars spent on roads, bridges will be misspent. we need to invest in infrastructure that supports and enables the future, not projects that tie us to a less competitive past." >> that's correct. also broadband deployment. >> also, broadband deployment. we are not the number one country in broadband deployment. those countries seem to be in asia. i would include education in infrastructure. we are not teaching our kids. by and large, we are not teaching them programming or coding. we need to do that. that is a major part of the country. >> eric, thank you for joining us here. let's send it out to rick santelli with a look at what he is keeping an eye on for the "santelli exchange." >> i'm excited about 20 k. are we getting ahead of the facts in stocks? we are going to talk about that. when i hear infrastructure, it is always paired with debt and deficit. is there something to worry about? we are going to talk about that as well after the break. only at&t offers you all your live channels and dvr on your devices, data-free. it's entertainment. your way. welcome back to "squawk alley" rick santelli. 20,000 is the phrase of the day. when i hear that, i hear a very good point being made. we're up 20,000. that's great. we never know when anything is going to get passed. we don't know what's down the road. we have had a few more facts. a lot is up in the air. i'm not a fan of tesla. not for the reasons you think. i'm a car guy. i hope elon musk does what he says. the on going question of profitability. as you take a look at a six-year chart of tesla, we have harded traded below 150 in years or 125 in other years. in my opinion, that's a real generous chart considering the facts we know right now. does that remind you of anything? it reminds me of the stock market. i find it so difficult, that many smart people can look at tesla and say, well, we're talking about the future. we're talking about revolutionary change here. i get it. i am sticking with it. in five years, i'm going to look smart. i think that's exactly the way you need to look at the u.s. stock market. in terms of infrastructure, the pairing there is obvious. you know i don't like debt. infrastructure in the past has meant, hey, how can we spend some money. we need new curbs. when it was all spent, it really wasn't a very good stimulus. it wasn't shovel ready. i don't see a big new power grid. i don't see lots of new major infrastructure like we did in the 1930s. is it different today? i'm trying to be consistent and objective. here is what i see. what we are really spending on the infrastructure i hear from the current administration isn't about stimulus but about replacing worn-out roofs. you don't do it for infrastructure. it may help your resale. that's not why you do it. you do it because it needs to be done. the benefit is the long-term usage. we need to change the way we think about infrastructure and be careful on how we spend on infrastructure. carl, back to you. >> rick santelli in chicago. the dow is up 134. so far, so good. back in a minute. introducing conduent. one of the largest business process companies in the world. whether it's in health care, customer care, technology, transportation or government. we touch millions of lives every day. conduent. advancing the everyday. it has been quite the morning. dow 20 k happened right out of the gate. about one-third coming from boeing. a lot of other components involved. leading us to conversations about what is sustainable, whether retail joins us next, what that might mean for the averages and how much credit goes to the hopes that the new white house is bringing with them. >> interestingly, when you say retail, you mean the retail investor but i was thinking about gap, which lost the leader in banana republic. the ceo will be overseeing that unit. another troubling headline for a company that has been struggling to turn around its business. >> we got a key earnings report. qualcomm, we have been hearing about. apple kind of attacking them on their business p model. >> both qualcomm and apple, apple crossing 122 today. dow 20 k for a good period of the morning was the number one trending on twitter. that's going to be the halftime's responsibility starting now. thanks so much. our top trade this hour, dow, 20,000 and beyond. the index crossing that milestone right off the open today leads us to wonder what is next and how long this so-called trump rally can really keep going. with us this hour, joe terranova, pete weiss and aaron brown, head of macro investments at uvs economy. is it sustainable? >> yes, i think it is. the market has