Transcripts For CNBC Squawk Box 20170515

Shanghai composite up by 0. 2 . The dax is down by 2 . The tenyear yield, 2. 24 . A couple of big headlines were watching. First one, crude prices. Wti crude trading higher after the ministers of saudi arabia and russia agreed needing to extend the cuts. Including russia agreed to cut output. Deciding whether to extend that agreement. A lot of folks will be watching for that. Also, a big developing story out of north korea, the Company Announcing the missile that carried a heavy Nuclear Warhead is capable of hitting targets in the pacific. The latest launch was widely condemned by the u. S. , japan and south korea. The white house calling north korea a, quote, fragrant menace. And urged allies to enforce stronger sanctions. And then on this weeks agenda, it say big week for retail earning. Those earnings have been not so hot. Home depot and tjx. And wednesday, target and l brands. Thursday, walmart and gap. Also getting results from cisco, alibaba and campbells soup. And some disruptions from whats calling wannacry, Wannacry Ransomware worm. It wrapped up computers in 150 countries. The bug exploits a security flaw in windows xp. Once it infects a computer, it encrypts the files and then spreads to other computers. Wow, it just hit our teleprompter. I dont want it to happen nothing ever why am i not its in 150 countries. Everybody gets it. Youre feeling left out . I dont know. Do i not do things that other people do on computers . You know, your inews this is what andrew said that could have been the problem with it. Theyre not asking for 10 million. 300 through bitcoin. They want 300 in bitcoin. The attack has shut down systems in the uks Health Service. And prompted automaker renault to idle factories. Other organizations reporting infections. We saw this last week, fed sext. And it was based on Software Developed by figures, right, the u. S. Nsa, to spy on enemy computers. Microsoft released a Security Patch that fixed the vulnerability back in march. But many systems havent been updated. Were going to talk to a psycher security expert in a few minutes. Kind of interesting to see china infected, russia who did it i wasnt infected. Maybe i did it. I probably wouldnt be a ransomware hack guy. You dont have the expertise . Do you believe nsa, they know everything. They do everything, they know how to do everything. Did you see snowdens comments about this . Saying, yes, this is more of the problem with nsa, and our own plans to be offensive rather than being defensive. In retail, lets go to amy javers to top political stories including a search for candidate to replace fired director james comey. Lots of speculation about that. And more to the white house, eamon javers. Youre right, andrew, the reverberation over the weekend to fire james comey including this reaction from former director of intelligence james clamor who said the american institutions of government are understand assault. I think in many ways our institutions are under assault externally, thats the big news here, is russian enter neernsinn our election system. And on assault internally. Internally from the president . Exactly. Saying the constitution of the Founding Fathers is eroding. That comes from somebody that the white house is saying is exculpatory to them. He simply does not know where the counterintelligence investigation into the russian collusion exists so he could not give this white house a clean bill of health. Meanwhile, the white house determined to push forward as quickly as possible find a replacement for james comey. Entering at the department of justice, eight candidates over the weekend including Andrew Mccabe currently the fbi director who says hes not likely to be picked but interviewing john cornyn from texas, alice fisher, judge Michael Garcia being interviewed. Another judge, henry hudson, u. S. District court. Adam lee. Mike rogers, a former congressman, House Intelligence Committee chairman and fran townsend, Homeland Security adviser to george w. Bush. All being interviewed there. But the president squeaki ispea briefly an air force one saying he wants to make this process as quick as possible. I think the process is going to be quick because almost all of them are very wellknown. Theyve been vetted over their lifetime essentially. But very wellknown. Highly respected really talented people. And thats what we want for the fbi. Ill see you over at the school. Have a good time. The president is leaving at the end of the week for an extensive foreign trip. Its possible that we might know his pick for the director of the fbi before then. Democrats for their part in the senate are threatening to vote against anybody until theres a special compromise made for the votes. They dont have the vote to make that happen. They can simply cast rejection on the floor of the senate. They can vote over a majority vote anybody that the president nominates. Thank you, eamon. Can we go back to eamon do we think theres a wholesale changeup in the white house between now and friday before they make this big trip . Look, there are a lot of rumors out there. Ive been asking some people, its very hard to get a read on where the president is right now. The fallout from the comey firing has been pretty intense. The president , you know, on friday tweeting that he might have secret tapes of james comey. He might have a secret taping system in the white house. Thats getting a lot of attention. Theres a lot of confusion swirling around in the white house. The president is reportedly angry at his staff. He didnt feel they rolled it out very well. Who is behind it. And will he do that before he goes on that massive trip. He might want to make to make any changes after that. But this president could wake up this morning and decide to pull the trigger and replace him or sit tight. Okay. Twitters Ceo Jack Dorsey speaking out about President Trumps use of twitter as a social platform. Dorsey sat down on sunday today and responds to critics saying that saying President Trump shouldnt use twitter. I believe its really important for our leadership. I believe its important to hold them accountable. I think its important to have the conversations out in the open, rather than have one behind closed doors. So if were all to suddenly take these platforms away, where does it go . What happens . It goes in the dark and i just dont think thats good for anyone in that. Obviously, dorsey would be defending his platform. But he brings up an interesting point. Weve said all along that people are watching what he says on twitter, it is a direct line to the president. It is a direct line to see what hes thinking. I like the tweets. I do. And i like the ability to say exactly what, you know say exactly what he says without having it go through the however he decides to write a story. A couple big stories today, andrew, Washington Post says that the senators dont know what to do let me see what they say and the New York Times did a center piece. This is the senate gop wrestling with the agenda now because its full of peril. Mike led said, yeah, sometimes, if this stuff happens, it can bog things down but were going to do it either way. But they talked to another guy who is speechless. And i read it and they said they asked them as he was getting on an elevator what was going to happen and he smiled at them. So that speechless . And then i read hold on then i read the New York Times, senate gop is edging back from the president. And they were able to come up with several republicans have openly questioned. So several is two, i think, isnt it . Yeah. You got mccain and you might have i dont know, what other one. Realize that most people, most people read these tweets. And some of the things that have happened. If you look at just the Approval Ratings of the president you look at the Approval Ratings of his decision to fire comey, irrespective what he did you think he should have done or not, most people think its incorrect. The polls just the veracity of polls in general, that we see. After the election i dont see that twitter though, to take those tweets, you can disagree with those tweets but its an unvarnished view. Thats true. And reading, listening to clapper, or listening to the very basis of you know, the countrys democracys in question. If you read rosenstein read the reasons, read some of the stuff that the journal has been writing. Theres a hundred valid reasons do you realize that the president or his people said one thing. I understand. And he said something completely different, you do recognize that . Yeah, i do recognize that ben rhodes when talk about Jonathan Gruber with obamacare said it was attacking. I do rec nice that susan rice came out and said every single thing that happened in benghazi is because of yeah, ive been watching washington for years. I do see how they operate. I mean, seriously. I was told id be able to keep my plan and my doctors. I was told that the irs would in no way server if you think that all of those things are awful which i think you do, ill hold your hand on that and say, you know what, i dont want anybody you didnt do it when it was happening for the past eight hours. You cant go retroactive and go back and have those things bothered you, they never bother you before. We have a problem with people spinning and lying, we have a problem with people spinning and lying all the time. Also with your words about the definite kit and not being revenue neutral. You should have been talking to me during the stimulus. So, now you want to no i just wish you cant go back and change history. You needed to be concerned all along. Its only 6 14 in the morning on a monday. Right. I mean to hyperventilate Everybody Needs do you read the journal once in a while . Yeah, i do. Theyre not so thrilled about whats going on right now. You cant go to mother jones and i have not been to mother jones lets get to the broader youre not a contributing editor. Joining us right now to talk about the markets is chris cordero, he is managing director, chief executive officer and chief executive officer of regent landing. And bruce from jpmorgan. Gentlemen, welcome. Chris, lets talk about the earnings season. Its been an incredible a strong earnings season, what do you expect to see next . Despite what is going on in washington, earnings season has been really robust. What i think is the most positive thing, usually after earnings calls theyll guide lower. Theyll try to ratchet in expectations sometimes and that hasnt happened. I think that bodes favorably for the rest of the year. Is that strength from consumer, strength from businesses or kind of strength across the board . I think its straight across the board. You got Consumer Confidence up. Youve got businesses feeling a little bit better. Despite whats going on in washington, ive seen positive stuff on earnings sides. Bruce, are you seeing the same things on the economic side . I think weve seen some growth, and pick up on inflation. I think its been soft particularly on the consumer. I think whats been driving the world in the last six months is the pickup on business spending and particularly outside of the United States. I think what were seeing growth is holding up but were going to see it pick up, were seeing china slow down. The growth is solid. I think the earnings numbers are solid. I think the surprise in the last coming of weeks is on inflation. Were now having very low inflation proceedings, particularly in the u. S. And thats raising questions on whats going on there. Raising questions and leading questions on what the fed is going to do. Whats your best estimate . We think the fed is going to hike 25 basis points. Weve also seen the labor market tighten. Weve also seen things like productivity, unit labor costs send a negative message. We think the fed is looking in the more immediate term that they will see inflation higher. Chris, does that matter to you that the fed ratchets up Interest Rates or is that something that youve bake in here . Certainly, the june increase, we baked into that already. We just need to get back to a more normal Interest Rate policy over time. It cant be held artificially forever. I view that as a positive. Chris, one of the things were trying to get our hands on is whats happening in washington. Im not sure i can help you too much there. Our working hypothesis is washington is slow, it doesnt help too much. Were basically not building in stimulus. Were not building in big trade policy changes. And obviously, were not sitting here with an enormous amount of conviction that we think is downplay, what washington will do for the macro economy. Chris, you like two stocks, one is apple, the other is comcast. Sure, i think apple is a hidden asset stock. If you can strip off the 250 billion off its books it becomes a tremendous value. Somewhere around 14 or 15. Thats great for such a huge brand name. And i think thats hidden a lot. What about comcast . Comcast, i think the content is great on comcast. But what i think most people overlook is the fact that it delivers 25 of the broadband for the u. S. And that market will continue to grow and just add to its stability and earnings. Even though people are cutting the cord when it comes to cable . Well, they cant cut the cord for internet. Thats the important part. Gentlemen, i want to thank you both for joining us on this monday morning. When we return, Global Reaction to the cyber attack that has been on hundreds of thousands of computers since friday. At 7 00 a. M. , senators purdue and barrasso will join us. And peter orszag. And alex rodriquez. And barry stern like, and thomas donohue. 8 30 a. M. , well be joined by Larry Robbins and marc lassry. Huge lineup of guests this morning. Stick around. Squawk box will be right back. Its been over 100 years since the first stock index was created, as a benchmark for average. Yet a lot of people still build portfolios with strategies that just track the benchmarks. But investing isnt about achieving average. Its about achieving goals. And invesco believes doing that today requires the art and expertise of highconviction investing. Translation . Why invest in average . The shlike a bald penguin. How do i look . [ laughing ] show me the Billboard Music awards. Show me top artist. Show me the top hot 100 artist. They give awards for being hot and 100 years old . Well take 2 [ laughing ] xfinity x1 gives you exclusive access to the best of the Billboard Music awards just by using your voice. The Billboard Music awards. Sunday, may 21st eight seven central only on abc. Welcome back. Businesses across the globe bracing for the cyber attack fallout. Brad smith calls the Ransomware Attack on windows the governments of the world for a wakeup call. Joining us the Security Risk Management Platform with customers like netflix and pepsi. Before we get into the implications of this who have eye been talking to and what have you learned . Thank you for having me. And good morning. What were seeing with the Ransomware Attack, you can compare it to the equivalent of a missile launcher that Somebody Just left in a local neighborhoods and a bunch of teenagers are picking up this missile launcher and shooting rockets at thousand. So, i would say its quite troubling. What weve been doing over the weekend, the Security Research team has been following the attack. The attack has subsided. But it does not mean that it cannot pick up again. And weve seen millions and millions of organizations that are potentially vulnerable to this tiype of an attack. You just said it could pick up again. Theres a worry of course this morning, a lot of employees and companies all over the world are going to go into their offices and turn on their computers again. That might ramp up these attacks. Is that what youre worried about . At the same time, i know there was an effort to slow down the worth over the weekend. Yeah, absolutely. Were very much concerned about this. What happens when a computer is being affected, the computer reaches tout a command and control center by the hackers. And the command and control center sends instructions to the infected computers. Whether you plant ransomware in a hospital or whenever you just wipe out all of the data, its entirely up to the hacker. And what has happened over the past couple of days is a Security Researcher by accident registered the domain that should have belonged to a command and control computer. So the malware is basically regrouping. Figuring out what to do. But the attacker at this point, the malware through a different domain where it could tick pick again. If you snooze, you lose. If youre a viewer right now and you havent turned on your computer at the office or laptop at home or what have you, or even if you have, what should you be doing . You should be doing a couple things. First of all if you just condition yourself, think before you click. Instead of just clicking on email attachments. Clicking on web pages. Every single viewer is going to be dramatically better awful they think before they click. Dont up attachments that you dont know or dont expect. Number two, apply the latest microsoft patch as soon as possible. Because that microsoft patch is going to basically make the computer safe. Just to put a fine point on this, were talking about this being limited to folks who have Microsoft Windows on their systems . Correct. Does that mean just by inference, because people ask this all the time, does that mean that apple is somehow safer . Does that mean that people just arent writing viruses and or this type of attack software for apple . Because theres less apple out there. No. Thats a common misconception. It happens that this attack is targeting the Windows Computers with the untouched and we estimate theres about 1 Million Computers worldwide that are vulnerable to this type of attack. But apple is absolutely vulnerable to similar type of sa steak attacks. Are you any safer if stuff in is the cloud . No that does not make you any safer. If you put stuff in the cloud, you depend on your 30 parthird s and if one is attacked, youre vulnerable. Alex, we appreciate your time this morning. Thank you. See you soon. Thank you. Coming up, it is infrastructure week in washington. Former pennsylvania governor ed rendell will join us next to talk rebuilding america. As we head to break, thats a good picture of him, isnt it . As we head to break, heres a look at last weeks s p 500 winners and losers. Im dr. Kelsey mcneely and some day you might be calling me an energy farmer. Energy lives here. With e trade you see things your way. You have access to the right information at the right moment. And when you filter out the noise, its easy to turn your vision into action. Its your trade. E trade. Start trading today at etrade. 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With it, i earn unlimited 2 cash back on all of my purchasing. And that unlimited 2 cash back from spark means thousands of dollars each year going back into my business. Which adds fuel to my bottom line. Whats in your wallet . Announcer welcome back. Youre watching squawk box live from the Nasdaq Market site in times square. Good morning. Welcome back to squawk box on this monday morning. U. S. Equity futures at this hour, as we set up for not just today but the week, the dow looks up lier by 2. 5 points. Crude prices have been surging after Saudi Arabian and Russian Oil Ministers agreed to cut output. Youre looking at wti crude now up 49. 17. Today kicks off infrastructure week in washington. Its an annual event that brings various groups together to bring about the biggest priorities in the path forward for administration. Good morning. Good morning, becky. This is a first of week of events in washington and across the country and how do we build the nations infrastructure. There are no executives some some of the companys largest instruction and engineering companies. Among them labor groups as well. And we are trying to injects urgency in the long push for infrastructure investment. Especially at a time when President Trumps economic agenda keeps getting pushed back. One is theres a cost to waiting. Were seeing 160 billion as productivity being pushed back every year. Congestion on highways cost 24 billion a year. The after delay is now two hours. And thats costing billions of dollars. Infrastructure is more than just roads and bridges. Theyre going to be talking about waters treatment and energy grid. And elaine chao also talking about the possibility of veteran hospitals. And Jared Kushner is involved in this issue. As part of his new office of american innovation. So, guys, there are lots of things going on but theres no consensus yet on how to bring about the president of the United States trump infrastructure package. One source tells me one option is on the table of having reform early to pay for it all. For more on infrastructure investment. Lets bring in ed rendell, former governor of pennsylvania. Hes cochair of rebuilding america. And do you think that repatriation is one way to go about it. And you actually mentioned congressman delanies bill. Did you see most of the money will be used for infrastructure. Or most of the money coming back used for infrastructure, because thats not going to fly. No its a combination of two, one, the money coming back. And two, joe, the companies will get significant tax credit for investing in infrastructure. The private sector needs to be involved in the infrastructure. But one message that were sending out to washington other than its time to go. And it is time to go. Weve talked about this for too long. One message there is, private investment can help but its only part. Puzzle. For example, 60,000, less than 100 of those will be told to give a return on investment. The other will be have to be done with state and local laws. Theres no escaping it. Interesti interestingly, President Trump mentioned the possibility of a recorker bill as part of an overall tax reform package. People worry about gas taxes. All of a sudden theres that poll of money and it never goes to for what it was designed for in the first place because we know how washington operates. Thats one of the problems. Is there a way to write a bill saying going into that bridge, no ifs, ands or buts . Sure, we did that with Harbor Maintenance fund. The federal government has taken about 900 million of that to balance the budget. They wrote a new bill that said you cant touch it. Thats it, its in a lock box, it cant be touched. And you can be a taxpayer seeing that. In the 2000 election and al gore so paul ryan says 40 of private money for every dollar of government money. To republicans, thats the what we should do. What do you think, one for one . Or more government . Yeah, i know you dont like the 40 you think thats ridiculous, right . Well, because private money is not going to come in, as you well, joe, unless theres a return on investment. Theres very few things we can to do set up an Infrastructure Fund with loan guarantees. We could also sloan guarantees. Allows states highways. Private dollars i think will only be 20 , 25 of the puzzle. Its 4 to 1 government now. And the government share should be split between federal, state and local. Interestingly, joe, 22 states including some very red states like idaho and north dakota have increased their gas tax in the last five years. Its time for the federal government to step up. And ill ask you a question, and becky and andrew, the same question, how much is the federal gas tax right now . I knew this is it 26 cents, 28 cents. 17 and change a gallon. Most people. Even the most educated people, i give this speech all over the country have no idea what it is. Raising it 10 cents is relatively low. Its falling over that time. Right the last time it was raised president clinton in 1983. And it hasnt been raised since. And the great Ronald Reagan said why would we put off something when ten years from now its going to be more expensive. I dont like you that quote reagan, governor rendell. Thats all right. Thats all right. Theres a lot of quotes i guarantee you theres a lot of things he said that you would not quote, just knowing you. Joe, guess who raised the gas tax before bill clinton . Guess who raised the gas tax . Ronald reagan. These tax credits. You say theyll help a little, why would that work . And why is that not the way to do it for private secretaector them involved and how much would it help . Well it would help, with things new on the drawing board. Not things already in the pipeline. And that would be difficult. So things that are already in the pipeline, all of that money would be doing is giving a tax break to rich people. And wouldnt be creating any new jobs. Any new construction. Many more american manufacture. You could craft it essentially that it could work but its very, very delicate. I would matter the money went to the infrastructure. And the infrastructure investing in significant progress. And i also think on state highways, you could get back into the business of adding tolls. And user fees make sense. That little old lady in philadelphia who pays for a bus or the subway, she doesnt want to pay for gas tax because she doesnt use the highway so that exempts her. And people that do use, will pay for the use of it. You said something becky said something very important. The cost of inaction. The cost of doing nothing. If you raise the gas tax 10 cents a gallon and index it to inflation. The average person would a 140 in gas tax. But if you went through one and that is close to 250 to 300 to repair. Just one. Just out of curiosity, are truckers unions opposed to this, or the trucking industry, are they opposed to this because of what it means for the bottom line . They dont want to see an earmark just on that. Generally, pagainst the gas tax. But the afl cio and the chamber of commerce both agree that the gas tax should be raised. All right. Governor rendell, thank you. Potholes, if you got lowprofile tires you get a flat from potholes. Absolutely. And joe, kudos to your producer, build me up buttercup, that should be the theme song for americas infrastructure. And how about that pic did you see that picture we got of you. Ive seen these in teenage girls room. You do you look like a heart throb. Must have been photoshoped. You may be right. Anyway, governor, thanks for being with us. Up can go up when we return, former budget director peter orszag is going to weigh in on the economy. And then admiral stavridis is going to weigh in. And later marc lasry is going to join us with his best investment analogies and his latest call. Youre watching squawk box on cnbc. Back in a moment. Year in taxes and fees for your unlimited plan . Only tmobile gives you unlimited data with taxes and fees included. Thatll save you hundreds. Get two lines for a hundred dollars. Thats right. Two lines of unlimited data. A hundred bucks. All in. And right now, were giving you even more. For a limited time, get a free Samsung Galaxy s8 when you buy one. Thats two galaxy s8s for the price one plus, two lines of unlimited data for a hundred bucks. Taxes and fees included. Only at tmobile. Its been over 100 years since the first stock index was created, as a benchmark for average. Yet a lot of people still build portfolios with strategies that just track the benchmarks. But investing isnt about achieving average. Its about achieving goals. And invesco believes doing that today requires the art and expertise of highconviction investing. Translation . Why invest in average . Welcome back to squawk box. Time now for the executive edge. Were learning now more about which highprofile investors bought into snap which went public in march. Scc showing fidelity was the biggest owner. 33 million shares. Blackrock bought 9. 4 million shares, vanguard, 7 millions be third point 2. 25 million. David tupper held 100,000 shares but had trimmed his figures in as the stock price ran up. And lyft, this is fascinating is teaming up with the selfdriving car waymo. Waymo has some of the most advanced selfdriving technology and just began testing cars in phoenix, arizona lyft has ride sharie ing services in 300 citi. And waymo will continue working with jonl motgeneral motors whi stand in a material way against uber which is spending with a lot of who you know, folks. And uber already had waymos technology, right . Thats the other thing. Thats in the court. Court ruled over the weekend they could go ahead i think a judge said they could go ahead and look into whatever it is doing. By pushing the court case forward. They go into some partnership to get the info . No one gives you that, you got to take it. If it was there for the taking why go through all of the machinations . Its possible google could own it from this. This is bad. This is not a good situation. This is a bad situation. Its criminal. The lyft guys are nice guys. These guys finish third and fourth. As you can see. The other would say you can call lyft, no, get an uber. Get an uber, its almost like get a kleenex. I agree. Coming up, live sports platform winview answering big backers including discovery communications. Tom rogers, the companys executive chairman, will join us next. On deck right here on squawk box former Major League Baseball superstar Alex Rodriguez. And Starwood Capital chairman and ceo Barry Sternlicht. Theyll step up to the plate and take a swing at the issues that matter the most for your money. From gamechanging policies in washington to market curveball. Well cover it all. Grab a hot dog and a cold drink. The 8 00 a. M. Hour is sure to be a grand slam. Squawk box will be right back. When this bell rings. It starts a chain reaction. Thats heard throughout the connected business world. At t Network Security helps protect business, from the largest Financial Markets to the smallest transactions, by sensing cyberattacks in near real time and automatically deploying countermeasures. Keeping the world of business connected and protected. Thats the power of and. Welcome back to squawk box. Live sports platform wingview announcing funding this morning. Participants include discovery communications, mine mental sports and entertainment and grand holding. Joining us is an old friend of our, tom rogers, executive chairman of winview and ceo of target media, formerly of tivo and yes of cnbc. I dont think i have been up this early for cnbc since the day we launched it 28 years ago. I remember being in the 6 00 a. M. Then. Im not sure since then ive done it. So tell us about winview. I dont think weve actually had you have we talked about this on the air yet in a meaningful way . Not here. Not here. It is a its all about how do we save sports, which is at the center of the Media Establishment on television, which is under siege. You know, when we started cnbc, it was broadcast networks were beginning to feel the pressure that cable could amount to something. And we needed to jump in. And now you have the whole broadcast cable establishment really feeling it in a whole different way. When you say save sports youre talking about espn . Youre talking about Television Sports generally. Espn, obviously, with 13 million viewer subs than it once had is feeling it. Nfl ratings were down 9 last season. But double that in the 18 to 24 demographic. Youve got so what is it exactly that winview does . Well, what winview does is something that has become the rage in europe. Which is, two screen, have a mobile phone in your hand, which 85 of millennials when theyre watching live sports do already, and play along while youre watching live sports on tv. So, what do people do . Fathers and sons when theyre watching sports together, buddies when theyre watching sports together, theyre talking about whats going to happen next. Whats the quarterback going to do. Hows the action on the field going to unfold . This gives you a tangible way to predict, and compete, and win for prizes, cash, or pride. Depending on how you want to do it. So its like a Fantasy Sports league for everything that youre watching . Its a really good question. Fantasy locked and loaded before the game starts. Youre picking your teams and your players. During the three hours of the sports contests, theres nothing going on. This is what that course. It gets you interested in the same way, on every play thats happening along the way. Every play thats happening along the way, live, while youre sitting there without a way to really tangibly put in to force what youre already doing in your head. And youre cross talking with can you bet, if you will, on whos going to score next . Well, bet is you dont like the word betting. Bet is not a good word. Because this is a game of skill. Were getting on the screen. Tell us why not. Its a game of skill. Right. Betting implies a game of chance. That its something that involves luck. Football game, basketball game, you get 25 questions coming at you over the course of a quarter. And skill overwhelmingly determines the outcome. I mean, truly overwhelmingly. So, if it were one or two questions that were coming at you, with somebody who is guessing, do as well as somebody who is skillful . Maybe. But 20, 25 questions coming at you, skill wins out. And games of skill are legal in particularly winview, which today is legal in 50 states. Thats why its legal because its not just a game its not a game of chance. Exactly. And thats very important. Thats a critical distinction. People when they hear well you can win money, they use the word betting. But, it really involves a totally different approach to how you engage the viewer. Obviously you can play along for fun. You dont have to be a skilled player. There are rooms with 20 people who compete. The top three in each room win cash. So very accessible. Also relative to fantasy, where very small percentage take all the money off the table. People get to play for free, right . Yes. Its a how do you make money and come up with the prize money . Well, right now, its fully advertiser support. And, with that advertising support, pepsi came in as our first key sponsor. At some point in the near future well let people put down a little bit of money, and that increases the pot. Obviously has to continue to be a game of skill. But there will be bigger prizes. Golf is coming. Golf is coming. Let me ask you, so you keep adding more sports. Yesterday there was some interesting things happening in the way it finally played out was pretty amazing. This 21yearold that this i mean, hes like did you watch any of that . No i didnt see any of it. God almighty. Every sport ultimately will be captured here. And you know, you got to the Sports Industry has got to do something. Baseball now 50 of the viewers if we can figure out how to make curling a game of skill, we will do it. You ultimately stay independent or you think you hook up with a tv network . I think for the time being, every we can be agnostic because every tv network, every sports league, needs to see millennials far more engaged in the Television Viewing experience and for the time being, being in that role is a great role to be. Thank you, sir. Thanks for having me. Still to come today, two guest host double plays. First senators david per due and John Barrasso join us for the 7 00 hour to talk cybersecurity, north korea and the trump economy. Then well talk business with Barry Sternlicht and yankee great Alex Rodriguez. Dear predictable, theres no other way to say this. Its over. Ive found a permanent escape from monotony. Together, we are perfectly balanced, our senses awake, our hearts racing as one. I know this is sudden, but they say if you love something. Set it free. See you around, giulia the power of a low volatility investing approach. The power of smart beta. Power your clients portfolio with powershares. Before investing, consider the Funds Investment objectives, risks, charges and expenses. Call 8009830903 for the prospectus containing this information. Read it carefully. Distributed by invesco distributors inc. Hack attack. A massive cyber breach cripples 200,000 computers in more than 150 countries and the malware could just be getting started. We will tell you what you need to know before you boot up when you get to work. Congress gets ready for a health care and tax code overhaul. Senators John Barrasso and david per due, theyre here with us on the set. Just back here right now. Theyre going to join us for the hour to talk about these issues and much more. And ride sharing startup lyft and Googles Waymo teaming up to take on uber in the selfdriving car world. We have that story and other headlines straight ahead. The second hour of squawk box begins right now. Live from the beating heart of business, new york city, this is squawk box. Good morning, welcome back to skwk skwk right here on cnbc. Were live at the Nasdaq Marketsite in times square im Andrew Ross Sorkin along with becky quick and joe kernen. Futures at this hour are looking up after what some people had worried might be down given this cyber attack we heard about over the weekend. Dow looks like it would open up about 35 points, nasdaq up about 3 points and the s p 500 a little over 3 points. Heres whats making headlines. United airlines finding itself in the news once again. This time some of the carriers cockpit Door Security codes were inadvertently posted on a public website. However officials at the Pilots Association said the problem has been solved. Also, over the weekend, jetblue picking up family off the plane because they had a cake on the plane. They were going to celebrate the mothers 40th birthday, headed to las vegas with two kids, they put it under the seat, then they put it in the overhead. The police came on. What . It was not a good situation. They rebooked the entire flight. It was another one of these sort of examples was it a dangerous cake . The police came on, theres video of it, where the police why . Policeman said there was no problem. Because there was infighting among the the attendants on the plane about where the cake was supposed to go. The whole thing was crazy. I think you can Second Screen this while were watching and find it on google. Western digital taking legal action to stop toshiba from selling its chip unit without western digitals scent. The disk drivemaker says such a sale would violate terms of the manufacturing partnership. Western digital seeking International Arbitration to resolve the matter. The unit could be worth up to 18 billion. Another Winning Weekend at the box office for disney and marvel. Guardians of the galaxy volume two held onto the number one spot. Took in 66 million in american ticket sales after 145 million Opening Weekend last week. Heres the loser, king arthur legend of the sword had a disappointing debut finishing third with just 14. 7 million against, yes, a 170 million production budget. So somebodys not happy this morning. Yeah. Thats got that stars the guy from sons of anarchy. You never watched that . Your mics office. Charlie hunter. I like him. He was great. Thought hed be a big movie star. Now i dont know. You get blamed, you kind of get tanished sometimes if youre the star in a 175 million, you know, like pearl harbor some day just ben affleck. Yeah. All right. Developing story at this hour, asian governments and businesses reporting just some disruptions from the wanna cry ransomware worm this morning. Bizarre. All the terminology. Wanna cry and its a worm. Computer worm. The cyber attack locked up hundreds of thousands of computers in more than 150 countries since friday. Security experts are warning a further disruption as more systems come online today. The bug exploits a security flaw in xp. Windows xp. Once it affects a computer it encrypts the files and spreads to other computers. Victims receive a demand for a bitcoin payment of 300 in order to regain access. The attack shut down systems in the uk Health Service and renault to alter some factories. Other organizations included federal express, telefonica, and the russian interior ministry. A 22yearold i. T. Expert was able to slow the spread of the worm after he registered the kill switch web domain which is found deep within the softwares code. The attack was based on Software Developed by the u. S. Nsa to spy on enemy computers. Microsoft released a Security Patch to fix the vulnerability back in march but many systems hadnt been updated yet. A developing story out of north korea, the country announcing that the missile it launched yesterday is able to carry a heavy Nuclear Warhead and its capable of hitting u. S. Military targets that are in the pacific. And the missile landed in the sea between north korea and japan. Close to russia, too. The latest launch was widely condemned by the u. S. , japan, and south korea. And the white house called it north korea called it a flagrant menace and urged allies to enforce stronger sanctions. The Prime Minister shinzo abe told cnbc that hes concerned over the latest actions by north korea. Translator it is indeed very clear that the threat posed by north koreas missile and Nuclear Program is now entering into a new stage. That is our recognition. With President Trump he is saying that all options are on the table. And he is showing the act, as well as by words, what he is advocating in this arena. We regard this posture quite highly. And abe also said its important for countries to present a united front in battling the north korean target. All right from Health Care Bill to the president s tax proposal were covering those topics and more this morning with our next guest. Joining us wyoming senator, dr. Senator dr. John barrasso and georgia senator ceo, senator and ceo, former ceo, david per due. I had to give you, you know, i mean its tough. Its tough. When youve got a guy whos got all these titles over here. So we already talked about this senators, and that is just the take, you knew it was coming, you know, the Washington Post and the New York Times here, you know, it was coming, start with the Washington Post, senator gop wrestling now with an agenda full of peril, because of comey. Now you guys just hopefully you guys know, you are both in very perilous position right now. And then, New York Times says that you guys, the senate gop, youre now edging back, distancing yourself from the president , because you need to be reelected at some point, too. And nows the time to start pulling back after the comey thing. So, i mean, does this well, you know, when i ran i didnt listen to the media, you know, in 2014, it worked out. You need to listen to the media, senator. Youre on the media. Youre espousing views now in the media. How can you not listen to the media when you are on the media. When i say its time to retrench from this president i take issue with that because i think its about time that we break some eggs in washington and change the direction. I mean, look, we were headed in the wrong direction. Look at Consumer Confidence. We talked about this a few weeks ago. Consumer confidence is on the rise. Ceo confidence is up. And talking about Capital Investment again. Look the people in the real world know what needs to be done up here. Its the people in the bubble in washington that are having a tough time. If i read it in the newspaper, senator, i assume its true. I mean, am i do i need to start recalibrating you need to get out to the rest of america. I do . I was in wyoming this weekend. Caspar as well as laramie. Ill tell you a couple things. One as with a number of Young Students who were then taking the oath of office to join the military. We are in capable hands in the future. But the issues of north korea came up. The issues was a world being a dangerous place came up. But i listen to the people of wyoming and what they want us to do is the things that President Trump promised that we would do. Health care reform, infrastructure, tax reform, we need to get the distractions out of the way. Get the job done. Well, its hard. And, you know, reading this in a way i can joke around a little bit about it, obviously, but were counting on a lot of these things, stock market is counting on a lot of these things. The, you know, the promises trump made counts on Obamacare Repeal and replacement. Counts on tax reform. Nobody needed a week of, you know, hyperventilating and hyperbole. Not everyone listens to the most out there democrats and the most out there Media Outlets that sort of, you know, pander and that. But, i mean, this is you didnt need that last week when youre trying to do the senate is considering obamacare, did you . Again, washington is based on running to the latest distraction. And what we have are some longterm systemic problems, the debt, the military recap but the president put out four priorities this year. One was health care, second was tax issues, but regulations are a big item this year as well as the supreme court. And i would say were making progress on the regulatory front and we did get gorsuch confirmed. So there is some progress. Weve got some heavy lifting yet to come with taxes, and now with this health care thing. You point out that washington runs to the latest distraction. You wish there werent so many distractions for them to run to . Just to keep more focused . Certain people see that but joe just said it right. The ultra right and ultraleft want to be the noisiest. But 80 of people in america want something done up here. Let me ask both of you a question about your own values. When you see the president or the white house say one thing about why they did something, in this case, the comey firing, and within 24 hours, you see a very different answer emerge from the president effectively undermining his own original answer, what does that make you think about whether you can trust whats going on inside the white house . And whether you can trust the president . Well what i know is, is that we cant trust the direction we were undertaking. Look this is the weakest recovery weve had in seven years. I appreciate that. Im asking if the president tells you something, whether you can believe it. I ask both of you this question. Well, what he told me so far i can go to the bank on. And we talked specifically about policy and what were trying to do. And so far hes backed everything up. You do worry about the distractions. This is infrastructure week in washington. We have so many people coming to town. Hearings this wednesday on the committee i chair with elaine chao talking about infrastructure. But yet, were not talking about infrastructure to the level that we need to to fix our crumbling road, bridges, what we need to do with waterways. All of the things that have to be done. And i just want to get away from the distractions and get back to getting the business done, which is what i hear about in wyoming every week. Get the job done. Andrew, still not answering andrews question. I guess this question, i like the way you phrased it, about look at your own values, and i hope you come up with the right answer here, because, you know, after what happened last week, if you investigate your own, but i guess what the real question is, is the dissembling, is the spin, is the way things are being conducted materially worse than the average administration . Thats what were told. That the like, and the untruths, and the spin, and the, you know, alternate facts, however you want to say it, that this is unprecedented in this first 120 days or whatever it is. And that, you know, weve got weve always got the straight scoop from the obama administration. Thats the part that irritates me. That, i mean, its like seriously . Suddenly this youre understanding how washington works . I mean is it materially worse . You were a senator during the last i think consistency is important. You want to know exactly what somebody is saying. Right. Take that word to the bank. And you want to avoid the distractions. Well, ill tell you the rest of us out here in the country look pretty cynically at whatever we hear from congress, from the executive branch, from i mean, i dont know if its materially its not a good thing. That includes the media. Its 7 i dont know if its materially worse than it was over the past eight years. Oh, i have a different perspective on that. I mean ive only been up here for two years and the view from the outside is different from the view in washington. Well thats true. I talk about the lens in washington, they see this president through the bubble lens that theyre used to seeing people in the white house. This guys not like any other president weve ever had. Hes nobodys choir boy but he wants to get things done. Hes a pragmatist not an ideologue. The people in the real world, i call it the bubble lens that people out there use to look at washington with, and theyre frustrated because of the lack of results up here. To that point lets talk a little bit about what you guys think about Health Care Reform in particular. That has passed the house, its now in your hands in the senate, what happens next . And john ill start with you, because youre a doctor. And i talked to tom price about it ear the weekend. Were working on our own Health Care Bill because what we have now, the status quo, is not working. You know, costs skyrocketed. Choices are down. Theyre crumbling, collapsing networks all around, even this past week aetna pulled out of a number of places, in wyoming our rates are some of the highest in the country. Were down to single choice. We had two. One lost so much money they had to go out of business. And the other lost money, even though theyre still selling in wyoming. So we need to do something to help try to rescue these people who are being crushed under this collapsing obamacare system. Plus, we need to do it in a way that lowers premiums and protects people with preexisting conditions. The bill that passed the house would not pass in the senate. Are you starting from scratch . Or are you trying to take that bill and work around it . Were going to pass our own bill. Were writing our own bill and then well conference it with the house after we get ours passed. We have a number of issues that were working on including lowering premiums, protecting people with preexisting conditions. But the urgency is that companies are pulling out of the obamacare market. Youre seeing the rates that are announced for next year, much higher, around the country, than they are right now. So, the status quo is failing. Obamacare has to go, and we need to do something that is patient focused to help protect these people who are out there that have been promised so much by president obama. And have just failed time and time again. Senator, are you in this group with ted cruz . Theres a political piece hes put together a group of senators, and hes now, senator cruz is not as much of an individual list but hes trying to gather together consensus, and work with other senators to get this done. Are you part of that . No, i am in one regard. We have a small group that we met a few times, but what you may be referring to is a group that set aside by the leadership to deal with obamacare. Right. And ted is now in that group. And i think that ted is really trying its important to get him on board. And hes also working i will say this about ted. He is really working hard now with young next of the senate to try to get something that we can pass. Thats the thrust of the politico piece is that hes suddenly, you know, consensus builder and not as much of a senator cruz is one of the brightest guys we have in the senate. We want to use that for constructive purposes. And i think hes in there right now trying to do that. I think were going to find Common Ground here that will get this set up to solve the problems we have today. Look, it wasnt that everything was perfect prior to 2008, either guys. And republicans are just as much at fault at this failure in health care as democrats. But, we have a chance right now, i think, to govern and to put this right. Ripping it up and then doing the senates own thing, how much would be very similar to what was what the house did anyway. Wouldnt 70 or 80 be the same deal . The issues are the same. The issues are the same. Obamacare expanded dramatically medicaid. We should have reformed medicaid. Thats a system that is a doctor didnt work. I saw that as i was practicing metd sin. I thought lots of money was wasted. In the states, if we had had that money we just thought we could do a much better job Getting Better care and coverage and help more people than dealing in the one size fits all coming out of washington. Whos doing your pr . You got some good pr . We want to get the policy right. Obamacare signed up 11 Million People or so . Mostly on medicaid. A failing system where about one out of three doctors wont take them. 24 Million People are going to lose obamacare . You let the left say this, but what theyre saying is, if you do the projections for whos going to be added, by the year 2030. Right. If we dont add them to medicare, 24 Million People dont get coverage. So theyre conflating 11 million that are covered by obamacare with the future 24 million getting it, and no ones there to push back. Here are the real numbers. There were 48 Million People in america who did not have Health Insurance prior to the aca. Today as we sit her 28 million do not have coverage. Of the 28 million 16348 got it because of expanding medicare. Do you think it was appropriate for the house to pass the bill without having the cbo score . I think its okay because its got to come to us and were probably not going to do anything finally until we see that cbo score. Let me tell you this, i for one dont put a lot of weight in that cbo score. Ive said this publicly several times. What im trying to do is help the caucus get to a and by the way, help the senate get to a commonsense approach to this thing that works for people back home. Should should rape be a preexisting condition . You know, its not look, take a look at the way that thats been all fact checked. It is not. And it shouldnt be. And it wont be. I mean, thats kind of the things that are getting thrown out there. You know youll find them here. You will. Not scored and discussion about whether really discussion about whether youre really covering more people or not. Whether 24 million really are losing coverage. And we shift gears immediately to whether rape is a preexisting condition . Is that the most important thing in this bill . I cant foth up that if youre going to put a bill like this together that rape wouldnt be. Oh, okay. All right. I mean in the list of priorities where youre trying to figure out how we do this, thats like, isnt it . I dont know. But it is one of the talking points. Senator says its not. Sit one of the talking points that well see. Anyway. Senators stick around. We will we do have two republicans. We do need something from the other peter or zag is about to be here right. When we return, former obama omb director peters or zag will join us. He is out with a new Global Health care study. Meantime check out the futures. Theyve been a little bit higher through much of the morning. In fact the dow picked up a little bit of steam. Its now up 35 points above fair value. S p futures close to 4 points. The nasdaq up by 3. 5. You are watching squawk box on cnbc. Ome meet the new guy. Ome meet the new guy. The new guy . What new guy . I hired some help. He really knows his wine. This is the new guy . Hello, my name is watson. You know wine, huh . I know that you should check vineyard block 12. Block 12 . My analysis of satellite imagery shows it would benefit from decreased irrigation. I was wondering about that. Easy boy. Nice doggy. What do you think . Not bad. Ok but weve got the get tdigital tools to help. Now with xfinitys my account, you can figure things out easily, so you wont even have to call us. Change your wifi password to something you can actually remember, instantly. Add that premium channel, and watch the show everyones talking about, tonight. And the bill you need to pay . Do it in seconds. Because we should fit into your life, not the other way around. Go to xfinity. Com myaccount welcome back to squawk box. The debate continued during the commercial break and here we are. Releasing a Global Health care study this morning surveying over 200 executives and investors about opportunities and challenges in health care. The objective of the survey, to see where these Industry Leaders see health care heading during this time of change. Joining us right now to share these results, vice chair and cohead of health care, peter orszag, also former omd director under president obama. We want to talk about the results but then i think we probably want to talk a little bit about what we were talking about during the commercial break where you got in on this debate. Sure. But whats important here is there are ten times as many people with employer sponsored insurance in the u. S. And this whole debate about coverage, were losing track of the value and cost agenda, which is more important for most americans, and frankly, the house legislation does almost nothing on that. Our survey was all about Business Leaders looking past all this drama to how can they deliver higher Value Health Care. Which is exactly where the focus should be. And what was the answer . The answer was, surprisingly, the majority of u. S. Health care executives, and investors, expect value based payment to be the dominant form of payment before 2020. That would be a very good thing. And then we need more innovation. And they talked about the forms of that innovation, too. Do you think that costs are actually going to come down . Again, this is back to this debate. I dont think theyre going to come down. I think they will grow at a slower rate. And by the way, they have been. Thats the untold story. In all of the drama over whats happened over the past decade, we have seen a dramatic deceleration overall, not on the exchanges which is for a small share of the population, but for example on medicare, costs per person on medicare has decelerated dramatically. Way beyond anything you could have expected. Thats great but were still talking about Health Care Budgets being 17 of gdp and growing. I know. And therein is the fundamental problem. There was a meme on twitter saying basically, which i degree with, we spent on health care and no one is willing to devote a sixth of their income to health care. And thats what leads to all of this tension about how we move the deck chairs around. And if you could fix it youd fix it how . I think the most important thing we can do is change how we pay. If you pay for quantity youre going to wind up with quantity. If you pay for value youre going to pay for value. Thats the most important thing and then there are multiple other things that follow. But the single most important thing is to continue down that road, and one of the one of the shortcomings of the current debate over what were going to do on the exchanges is that whole agenda of how we deliver higher Value Health Care for most americans is nowhere to be seen. I feel like weve been having that conversation for ten years. And theres been some progress. And the survey underscores that. We just need to kind of double down on it. The senate bill is going to try to get premiums down in a significant way for a lot of reasons. Because it would help in terms of costs, but it would also be something that voters are thinking about. Right. To offset maybe people that lose coverage, if premiums go down i think the guys, the republicans think that thats a winning issue in 2018. But the senate bill is going to try to get premiums down. How would you do it . How are they senator, how are they are they planning on doing it . These guys have an opportunity but it involves things that the house bill didnt do. Right but theyre going to write a different bill. Right. What you have to remember is most Health Care Costs are driven by what the providers are recommending and what theyre doing. You need to change their incentive. Theres a huge incentive by the way, which would have some bipartisan support. Not all democrats but there are a lot of democrats that support this movement away from fee for service. Theres an opportunity there, and at least today that hasnt been captured. Senator barrasso as a former doctor, you know very well about how people get paid, how doctors get paid, how hospitals get paid. I think we ought to be paying for value, paying for the quality of the care that were getting instead of the volume. I think thats the direction that we need to go in. But the entire cost of health care is undermining our economy. Warren buffett said it, you wrote about it last weeks annual meeting, he talked about the fact that it is crippling our competitiveness, and thats the challenge that we have to face. Were spending so much money on health care, and we need to actually lower the cost of care. If the cost of care stays very high, to ensure for it is going to continue higher. Peter has written on this thing and the thing thats not been addressed is the cost of health care. And the premiums go up for two reasons. One theyre managing risk. But they also reflect the rising cost of basic health care. Those are the two things that havent been addressed. I dont think that thats within the scope, necessarily, of this bill so far. But sooner or later weve got to get to the Health Care Delivery system and also the rising cost of health care. Real quick, what is your sense of the timing of when you think you could get something passed, and to the white house for signature . Well, theres a lot of pressure on this. Im hoping within weeks, not months. Maybe a little bit longer than that. We need to get this to the white house because we need to move on to tax reform. Youre in washington. Whats your gamble . Well, they might be able to pass something but i dont think its going to have the full cbo score and i guess id be in the mode of be careful what you wish for. Because you can get something done fast and wind up with a disaster subsequently. On your hands. Which is then not good for your politics. Okay, peter orszag, thank you. The house, the senate when we come back well talk about the huge global cyber attack with admiral James Stavridis. Stick around. Im dr. Kelsey mcneely and some day you might be calling me an energy farmer. Energy lives here. Predictable. The comfort in knowing where things are headed. Because as we live longer. And markets continue to rise and fall. Predictable is one thing you need in retirement to help protect what youve earned and ensure it lasts. Introducing brighthouse financial. A new company established by metlife to specialize in annuities life insurance. Talk to your advisor about a brighter financial future. Good morning. Welcome back to squawk box right here on cnbc. Were live at the Nasdaq Marketsite in times square. Among the stories that are front and center two economic reports out this morning to begin trading this week in about an hour from now were going to get to the latest empire state index. The new york feds measure of new york state manufacturing. Then at 10 00 eastern time, National Association of Home Builders will be out with its monthly sentiment index. Also, two multibillion dollar takeover deals to tell you about Just Announced in the past couple minutes. Scientific instruments maker thermofisher buying patheon. About 35 per share. Also debt Trading Agency moodys buying a Dutch Company its going to be paying about 3. 3 billion for a Business Information Company Called bureau van dyke. Moodys says that the deal will add to its perngs as soon as next year. Also this morning lyft is teaming up with alphabets selfdriving car unit waymo to develop a pilot program. The companies arent releasing many details. Waymo has some of the most advanced selfdriving technology and has just started testing cars in phoenix, arizona. Lyft office Ride Sharing Services in 300 u. S. Cities. The deal isnt exclusive. Lyft will continue working on a selfdriving program with general motors, which is a major investor in lyft. Coming up former nato commander James Stavridis will join us to discuss the cybersecurity, as well as north korea. We will be right back. On deck, right here on squawk box, former Major League Baseball superstar Alex Rodriguez. And Starwood Capital chairman and ceo Barry Sternlicht. Theyll step up to the plate and take a swing at the issues that matter most to your money. From Game Changing policy issues in washington, to market curveballs. Well cover it all. Grab a hot dog and a cold drink, the 8 00 a. M. Hour is sure to be a grand slam. Squawk box will be right back. Of innovative thinking. The power of 100 of the worlds top companies. The power of an etf. The power of qqq. The thinking we put in, clients get out. Power your clients portfolio at powershares. Com qqq. Before investing, consider the Funds Investment objectives, risks, charges and expenses. Call 8009830903 for the prospectus containing this information. Read it carefully. Distributed by invesco distributors inc. Containing this information. Read it carefully. What if we could bring you by having better values . At blue apron, we work directly with more than a hundred family farms. So instead of spending on costly middlemen and supermarkets, we can invest in the things that matter most making farmland healthier. Cutting down on food waste. And bringing you higher quality, fresher ingredients for less than you pay at the store. Because food is better when you start from scratch. Get 30 off at blueapron. Com cook but weve got the get tdigital tools to help. Now with xfinitys my account, you can figure things out easily, so you wont even have to call us. Change your wifi password to something you can actually remember, instantly. Add that premium channel, and watch the show everyones talking about, tonight. And the bill you need to pay . Do it in seconds. Because we should fit into your life, not the other way around. Go to xfinity. Com myaccount welcome back, everybody. Lets talk more about the global cyber attack that has affected at least 200,000 computers in over 150 countries. The attackers are demanding a ransom be paid to unlock those computers that are held hostage. Some Security Experts are predicting a second wave of attacks that potentially take place this morning as employees arrive at work and turn on those affected computers. Joining us right now for more on the governments response plus the latest out of north korea is admiral James Stavridis, he is the dean of the Fletcher School at Tufts University and the former supreme allied commander at nato. And admiral, thank you for joining us this morning. Good to see you about ek can i. So we know how this already played out over the weekend. There are expectations that it continues. Are we done with this . Or is this going to have a second leg down . Mixed messages thus far today. Were seeing more computers affected in asia. But as europe comes online this morning, not so much. So, lets hope that this one will burn itself out. I use that phrase deliberately. We need to kind of think of this almost as a pandemic. Really is a virus. And the key here is, its global nature. Weve never seen something sweep across the planet at this speed. Its very worrisome. Does this tell you that there are other potential pandemics that could be released . Or this is the opening of pandoras box to some extent . It absolutely is. You know, im hesitant to say hey were seeing nascent cyber pearl harbor, but we ought to wake up to the real potential of a devastating attack in this way. And this one is kind of a part of a release of some National Security agency tools. But these can be manipulated very easily to create that second wave. We always think of nation states as being the real bad actors. You get attacked by the chinese or the russians or somebody else, but theyve all been attacked this time around. Who is this and who are we fighting . This is cyber criminal activity, becky, and i dont see this as something that emanated from a nation state. It really is a crime, money, motive. And if you think of Cyber Threats generally, its nation states, its cyber crime, and then its kind of hackiveism, terrorism. Those are three categories. This is the middle one. Admiral when you spoke a few weeks ago you talked about detection, deterrent and defense. Very difficult to detect these things. How in the world are we ever going to get to the point where we can deter this type of activity . We need to first of all, senator, develop a doctrine. We havent really even defined what constitutes a cyber attack in the nation state space. So weve got to define that. When is our nation truly under attack . When theres kinetic damage, when there is personal damage . Secondly weve got to get better at the interagency working this. Today we have three different agencies in charge of this. Six different Cyber Centers across the country. I think theres a role for congress in trying to at least create a voice, a centralized voice on cyber in the cabinet. Admiral are we making ourselves safer or less safe by moving everything to the cloud . And when i say cloud, really only three Major Service providers, amazon, microsoft, and google, which control all of it, this attack doesnt work on that. This attack actually works on each computer independently. Correct. But ultimately are we all going to be at the mercy, if you will, at three companies that are going to hold all of our information . I think in this regard, andrew, its like in real estate, location, location, location, in cyber its backup, backup and backup. So, we need to be in the cloud. We also need hard drive backup. And we need some number of computers that are really disconnected from the internet. That can be brought on in an emergency. So its really three levels. And youre right to raise the question of these three service providers. We need a more distributed defensive mechanism. Its not just Cyber Attacks that were worried about these days but also traditional missile attacks, particularly with whats been happening with north korea, and maybe you and senator barrasso could both talk a little bit about where we stand right now with north korea . Yeah, i always say its sort of two streams of threat. One is the miniaturization, the hardening of nuclear weapons. The other is the ballistic missiles. The ability to deliver them at range. And its like in ghost busters, you dont want those streams to cross. Theyre going to cross in the next 18 to 24 months and then i think the United States has a very difficult much tighter time line than some people had been anticipating. Yeah. A year and a half potentially . Yeah. And just as i look at the technology and the reports i get, its accelerating, not decelerating. So, senator, you are just back from that region of the world. What does that mean . Should we be back to trying to talk and negotiate with this regime or is there Something Else we need to be doing . If what weve seen is the north korean efforts have increased in terms of scale, scope, sophistication. Theyve moved from liquid to solid fuel. Which allows them to be more stealth and more reliable in what theyre doing. This missile over the weekend, 1200 miles high. The capacity to get to our troops and our facilities in guam is there. We need to be engaging china, President Trump did that with president xi but youre right i was in china and i was in japan talking about that so everythings on the table. What we want is a peaceful solution to this. We want to make sure that that whole Korean Peninsula does not have nuclear weapons. And the best way to do that is have china engaged as our partner. Often we dont have overlapping interests with china but we do on this. They dont want north korea at war with the rest of the world, it brings it country close to them. But 90 of the resources that go into north korea come through china. Right. Theyre now going to stop, they say, the sale the purchase of coal from north korea. Because that forwards a lot of money into north korea. You know, we can put all the sanctions that we want on north korea, there have been a lot of ways and loopholes around it. China is going to be the active participant. Senators barrasso and per due is going to be staying with us. Admiral stavridis, thank you very much for joining us. What a pleasure. Great to see everybody. When we return we will have more from our senators, as we head to break, take a look at some of the big earnings coming out this week. The list includes home depot, tjx, target, walmart, cisco, alibaba, sales force dotcom and campbells soup. Hes a nascar champion whos shes a worldclass swimmer whos stared down the best in her sport. But for both of them, the most challenging opponent was. Pe blood clots in my lung. It was really scary. A dvt in my leg. 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We have seen green arrows, dow futures up by 37, s p up by 4, the nasdaq up by 3. Want to get back to our guest hosts, wyoming senator John Barrasso is here, georgia senator david per due is also here. We talked a lot about health care. Want to get to taxes. Or at least understand whether you think we will be getting to taxes in this calendar year. Because that seems to be the other major concern that investors have right now. What do you think . I sure hope so, andrew. I tell you, we set this year out the president laid out his priorities of health care, Regulatory Reform and taxes. We got gorsuch confirmed to the supreme court. It takes a year and a half before these changes take effect in the economy so weve got to get this going in order to support the expectation of consumers and investors around the country today. So, weve got to get this done this year. Realistic to . I think it is realistic. And we need to do it and we want a strong and healthy economy. You say why do you need to do tax reform . Its to help the economy. Its to get more people working. Here at home its to bring jobs back from overseas. I think we need to do repatriation, get to a territorial tax system. Theres a lot of money sitting overseas. We want to lower rates, make it simpler so our goals are there. We know what we need to get done. We have to get through Health Care First because there are two things we can do without democrat support. One is health care and one is tax reform. Id like to do these in a bipartisan way but theyve said no were not that interested in being involved with it but using reconciliation, a process in congress, we can do this with the united republican senate. I want to ask both a question about employment. Because one of the things that the tax policy should hope to do is try to trigger some more employment in the United States. But one of the industries that has been killed is a industry you know very well which is the retail business. And the retail industry. And sometimes now people look at the numbers and say more people have lost their job in retail than in coal jobs. You know i heard a number the other day do you think you can get these retail jobs back or do you think that theres something very different that needs to happen . Well, as consumption gross retail jobs come back. Theres no question about that. Manufacturing is another issue. And there is the adaptation to technology and innovation. But whats going on in america right now, and what drove this last president ial race, in my opinion, and what affected my race in 14 was that the number of disenfranchised folks in the workforce. We have about 145 Million People in the workforce. I would estimate over 20 are disenfranchised right now. Unemployed, underemployed and dont minimize that number and then the people have just given up and dropped out of the workforce. Its a tragic situation. And theres a conundrum right now that at the same time we have that number of people that are disenfranchised outside the workforce we have employers who cant find people to work. This is something in the same way that some people, including myself, by the way, think that manufacturing in america to some degree may be aknack ronnistic giving the advances were having in technology what is happening in the retail world . Do you think the same thing is happening there . Well, you have a movement in retail thats moving online, obviously. Right. Create a level Playing Field there. Whats happening is consumers are finding different ways to consume. Women basically are consuming their aspirational items the way they traditionally have, through named brand outlets. Online, and in brick and mortar. But theyre also going in online consumption. And the other is, even women of money will consume consumable items at the cheapest rate, and at the most convenient. And thats whats happening in retail right now. It does lead to a shift in terms of where the jobs are. Overall, retail sales to governments measure of it is going up. People are still eating out. Theyre still buying cars and doing all kinds of things. But it the mall retail worker may have a very different environment. I guess where do you find more jobs like that . What happens to those people . Well, thats morphing, right . You have online it moves to distribution, supply chain jobs, et cetera, et cetera. So we are seeing a growth in online because its more efficient and cost effective. Look at Dollar General my real estate costs might have been 3 or 4 of sales. At walmart and some of these other big box retailers its much higher than that. When you go online you dont have that cost of real estate. Its a big deal and they pass that along to their customers. So, its a changing world in terms of consume shun. Its affecting the rest of the world, as well. You think well tax reform is part of this, but also Regulatory Reform. The amount of time it takes to get all of these approvals of different permits to get something done, whether its a construction project, whether its energy exploration, is very, very long. It could take ten years to get the permits because theres a lot of capital out there. David and i meet with people around the country, the capital is ready to be deployed, which gets to the infrastructure part of that which will in many ways stimulate the economy. Government investment may be a part of it, but regular whatter to reform is a significant part of it. And i think as tax reform we do all of these things. You can get back to 3 growth to the country. Okay. Senators, thank you. You guys stick around for a little bit longer. When we return we have some stocks to watch ahead of the opening bell on wall street. Plus, we will wrap up our special hour conversation with senators John Barrasso and david per due. On deck, right here on squawk box, former Major League Baseball superstar Alex Rodriguez. And Starwood Capital chairman and ceo Barry Sternlicht. Theyll step up to the plate and take a swing at the issues that matter most to your money. From Game Changing policy issues in washington, to market curveballs, well cover it all. Grab a hot dog and a cold drink, the 8 00 a. M. Hour is sure to be a grand slam. Squawk box will be right back. [vo] when it comes to investing, looking from a fresh perspective can make all the difference. It can provide what we call an unlock a realization that often reveals a better path forward. At wells fargo, its our expertise in finding this kind of insight that has lead us to become one of the largest investment and Wealth Management firms in the country. Discover how we can help find your unlock. Wont replace the full value of your totaled new car. The guy says you picked the wrong insurance plan. No, i picked the wrong insurance company. With Liberty Mutual new car replacement™, you wont have to worry about replacing your car because youll get the full value back including depreciation. Switch and you could save 509 on auto insurance. Call for a free quote today. Liberty stands with you™. Liberty mutual insurance. Welcome back to squawk box. A couple stocks to watch this morning. Cybersecurity stocks getting a boost this morning following news of the wall moor attacks that have crippled computers around the world. Symant symantec, Palo Alto Networks and fireeye. Aig naming brian my pronunciation on the last name is going to be bad, duperreault as its new chief executive officer, hes going to replace Peter Hancock who resigned. He said in march that he would be stepping down when a successor was found and now he has. Tesla downgraded to equal rate from overweight at morgan stanley. The firm saying the automaker facing an increasing risk of having to compete not only with other automakers but with Tech Companies like apple and google. And starbucks was upgraded to buy from hold to Deutsche Bank said the coffee chain is showing signs of overcoming labor problems as well as issues related to the mobile ordering system. Still with us wyoming senator dr. John barrasso and georgia senator david per due. And gentlemen, we have talked about all sorts of issues that are facing you and facing washington right now. One thing we havent really gotten back to are the entitlements. And how you pay for all of these initiatives that were interested in doing. Senator, per due, this is something thats there all the time. Well it is. I mean i think we have two crises in our country today. One is the Global Security crisis that you guys talked about earlier. But also we have a debt crisis that limits our ability to fund all of these other things we need to do as a country, including our military. But right now the baseline budget for the United States government means that over the next decade well add 10 trillion to this debt. And most of that is in our mandatory expenses. Social security, medicare, medicaid. And the interest on the debt. Which is going up every day. So, these are the priorities that i want us to deal with, in the american congress, and so far in the last two years we just really havent done that. President trump has said hes not interested. In dealing with the entitlements. And is fine in the name of growth in increasing the debt. Well you on board . Weve had this conversation. I know. And there are steps to this progress. The first step is job one is getting the economy going again. Right. Senator barrasso . You cant cut your way to this. You need to grow your way through it. Yesterday was mothers day. My moms 94. The year she was born Life Expectancy for a woman in america was 56. So for all the right reasons, we have, through advances in medicine and clean air and water and hygiene, all these things have added all these years. Weve added all of these years to Life Expectancy in this country but we got the math wrong on Social Security and medicare. When Social Security was placed in. They didnt think people were going to live to 65. You listen to Lyndon Johnsons old speeches on medicare it was for the wit doughs because all the guys were going to be dead. And yet every time someone has one of these promises that have been made to them, good luck taking it away. How do you change that . And they have paid in, but they usually use up those resources long before the ages theyre living to now. We have tidal waves in ternls of Social Security and medicare in terms of just cost to the economy that we need to continue to look at. And resolve over time. Because 10,000 baby boomers today are turning 65 as they did yesterday, and will tomorrow, and we need to get to continue the economy growing and more people with jobs and working contributing. Senators, want to thank you both for taking the time to sit down with us today. We truly appreciate it. Thanks. Thanks for having us. This was fun. When we come back, a double dose of guest hosts. Former professional baseball player Alex Rodriguez, arod is going to be joining us. Starwood capitals Barry Sternlicht coming up. A special hour right after the break. Look at all three of those gentlemen. Whats the difference between all you know you got to pick out the one thats different. Yeah, do it by bank account. The futures at this hour. Take a quick look dow up 33 points. We will be back with arod in a second. Its been over 100 years since the first stock index was created, as a benchmark for average. Yet a lot of people still build portfolios with strategies that just track the benchmarks. But investing isnt about achieving average. Its about achieving goals. And invesco believes doing that today requires the art and expertise of highconviction investing. Translation . Why invest in average . Remember here at ally, nothing stops us from doing right by our customers. Whos with me . Were like a sports team here at ally. If a sports team had over 7. Im in. 7,000 players. Our plays are a little unorthodox. But to beat the big boys, you need smarter ways to save people money. We know what you want from a Financial Company and well stop at. Nothing to make sure you get it. One, two. And we mean nothing. Allstar lineup. Billionaire real estate guru Barry Sternlicht and yankees great Alex Rodriguez team up to talk about business and investing. And the heavy hitters dont stop there. Investing titan mark hasry will be here to talk markets, the economy and the impact of President Trumps agenda. Bus Larry Robbins tells us where hes putting his money to work. A power hour of squawk box begins right now. Live from the most powerful city in the world, new york, this is squawk box. Kind of small and wimpy here. Actually barrys here. Oh good morning. Good morning. He does. He does. Good morning and welcome back to squawk box here on cnbc live from the Nasdaq Marketsite in times square im joe kernen along with becky quick and Andrew Ross Sorkin. Our guest host Barry Sternlicht, ceo of Starwood Capital group. I was hugging you on that shot. How can i ask you hard questions . Its going to be if i seem worse than normal today its because im like over, you know overcompensating. Hes overcompensating. And arod is here. Alex rodriguez, former mlb player, ceo of arod corp and maybe we may be buddies and colleagues at cnbc soon. Maybe. Possibly. Well talk about that. And the headlines dont stop there. Investing titans Larry Robbins and mark lasry will join us on set in the next half hour. Andrew we are so poor compared to the i was glad when the senators were here, you know what i mean . Except per due, wait a minute, hes loaded too. Yeah. Were not its not going to get any better for us in the next hour. Lasry robbinrobbins, sternlicht rodriguez. Up 36 on the dow. I say to you andrew either this is not a constitutional crisis or the market doesnt know its a constitutional crisis. And doesnt even know that the tax plans going to get derailed yet. Its not things keep going up you think if taxes dont happen this year that the markets will sit up and Pay Attention to that . I dont know. But with all the deregulation just sort of the probusiness sentiment it just seems like things are okay businesswise. Blinders are on. You know, you keep saying that. Just get in i just said it. Just buy in the lets get you caught up on some of the headlines this morning. We have a multibillion dollar deal to tell you about in the medical space. Scientific instruments maker thermofisher buying patheon, not pantheon, thank you joseph kernen. The price 5. 2 billion exclusive of assumed debt. The price tag 35 per share in cash. Asian governments and businesses reporting disruptions from the wanna cry ransomware worm. The cyber attack has now locked up hundreds of thousands of computers in more than 150 countries since friday. Security experts warning of further disruptions today as more systems come online. People go into their office, turning their computers on. The bug exploits security flaw in Microsoft Windows xp software. Microsoft president brad smith called the attack a quote wakeup call for governments around the world. Check out shares of Cybersecurity Companies this morning, all trieding higher in the premarket. Youd be happy if you own fireeye up almost 5. 5 . Japanese Prime Minister shinzo abe speaking exclusively to trade and the future of the transpacific partnership. Translator what is at stake now is to consider what is best for us at this juncture. As far as the direction of where we are going is concerned it is important that 11 countries are united. So that we can come up with a clear direction of where we want to go from this point onward. Since the u. S. Understands the importance of having free and fair rules in the trading world, by all means, our wishes that the u. S. Will return to tpp. And President Trump has called the trade deal a disaster. Commerce secretary wilbur ross has called tpp a starting point. Lets get to our newsmakers of the morning. Barry sternlicht, Starwood Capital chairman and ceo, and i mean, arod. I have to say Alex Rodriguez the first time, i think. Sure. But everybody does anyone ever call you i guess you do. Your friends call you alex . Not my daughters. They call you dad . They call me dad. You should mention that Alex Rodriguez will host a new primetime cnbc show back in the game. And i think and youre bshs but strahan is executive producer of this . Yeah. Michael and i, something that weve been very passionate about is taking athletes that have run into some bad luck. If you look at the data, it suggests that a lot of our players are going bankrupt way too soon. So its an opportunity, a little bit like mark limones and the profit to get a chance to lend a helping hand and hopeful they they can get back on their feet and hopefully entertain some people at home. But more importantly that current athletes can hopefully look and be a little bit more proactive about their careers. You are good. You mention the profit and mark limones. Might be a good idea to watch squawk box and squawk alley throughout the day. You round things out with a little power lunch. Halftime report and closing bell would all be right. And then if youre interested in cars, jay lenos show was renewed. There you go. How do you guys how does this work . You two gentlemen . So i think we were talking yesterday, i think like five years ago alex called me out of the blue. And he was as passionate about baseball as he was passionate about business. And i say the smartest people i know, including in my own firm, are the ones who admit they dont know anything. Or dont know enough. So alex started calling people, myself, some of your future guests today like mark lasry and sat down with me and said you can get the four seasons in new york city and we started talking, interested in real estate, hes been successful in real estate and we stayed friends and i moved to miami, and we typically we seech other quite a bit down there. He called me up and said were here tonight as robin hood gala and alex, i was chair of robin hood for two years. Larry robbins will come on later, the current chair of robin hood, and alex cochaired the dinners tonight. He said lets do cnbc. I said, well, ill ask. And you guys said great. So were here. And i got its all good. Alex i remember talking to you about a decade ago, because this is something that you have been focused on for as long as i know. I mean it looked like you were always pursuing two career paths to me. Not just baseball but also making sure you were involved in business and a life after baseball. Yeah. I mean like ever since i was 10 years old i sat on my fathers lap. I had two dreams. One was to be a Major League Baseball player. But that usually never happens. And two was to be a ceo or a coo of some public company. Just got an opportunity now very early on to make my First Investment when i was in my early 20s, buy a little duplex. I was always thinking about life after baseball even before my rookie year. Get a chance to hang out with some of the smartest people in the world in barry, and guys like mark lasry and its been a great pleasure. How did you figure out who you wanted to talk to . What set your sights on barry as somebody you thought you could learn from . First of all you know the power of brand. Ive been fortunate to play over twelve years with the greatest brand in the world i think with the new york yankees. Great ownership, great infrastructure, great leadership. You knew him from cincinnati. Thats just now i got a little nauseous there. The greatest brand in never managed and my dad thats what youre you stole don. You remember 76 i guess . I do. I do. I remember the world series thats how far back i got to go. The best world series ever. It was. So with barry just a chance to be around the best. I see the power with the yankees have built over so many years. Barry with starwood, the story is incredible. And you get a chance to learn from people like barry. Amazing. So he didnt teach me baseball. It wasnt like a twoway street. What role i mean, will i know you know warren, too. Will the Alex Rodriguez company 30 years from now look like berkshire . Or will it be real estate . Where will you be . Media . What else is, you know, on the horizon for you. Thats a great question. You think about five year plans and they never work out. You take it one day at a time. You spend time with the smartest people you can in the world. Well youre here today. I think thats surround myself exception for today. But you know youve seen the show i guess. I like kind of the private equity style of investing where you kind of take it where opportunity takes you. One thing is for sure you build yourself with the best team, surround yourself with the greatest, smartest minds in the world and go out and do some collaboration. I will say, hes a great baseball player, we know that. But hes a really thoughtful businessman. And i thought it was interesting to introduce him to the Business Community the way i know him so thats why, you know, i thought it would be fun to come on tonight. And hes a wonderful philanthropic guy. So when i asked him to chair the dinner tonight for robin hood he was like, sure, ill do it. And later on he started dating this attractive young lady who will be at the dinner tonight. So if you havent bought your tickets there might be two or three left and you can bid for them if you want outside. Hes working it right here. For robin hood. When barry calls you and emails you and goes, hey, i have an idea. You answer really quickly and say the answer is yes, barry, whats the question. Well, there you go. So were going to work on tax reform next. Bigger issue, parry, so, i mean, i think eight years ago you were open to what was starting, four years ago youre like, what the hell happened, and now are you are you back to where i mean, in terms of the private sector, and how its treated, were in a better position right now . Oh, no question. But, its so such an attractive environment for Business Leaders, which your prior guest talked about. The negative is we dont succeed the backlash could be significant. So donald really needs to succeed. And i just hope he stays on the main script which is the business script around his five his five big initiatives. The regulations have been good. Deregulation is good but youve got to get it done. But even the bully pulpit can help in terms i agree. And stopping new regulations. Barry, you say all things are great i didnt say all things are great. How much money have you invested since january . Well i mention as a function of all this . I think i actually think we have the inverse trump effect right now in the economy. Which is a new tax reform. Im an individual, and my Capital Gains tax is going to drop, i might just wait to sell stuff. So the real estate deals i actually think are going to see fewer transactions until this is cleared up. Whats coming . And then ill sell my stuff into a lower Capital Gains environment. Sometimes its the real estate. But but if youre long the trump economy, if you think the trump economy is going to be great, i would think and the whole goal of this exercise is to get people like you to invest in the real economy, i would measure his success by whether youre investing in the real economy, not whether youre selling. I think investors i think major investors are somewhat cautious, right . Because we have this border tax issue. We dont know exactly where to put our next plan. We havent been able to repatriate the cash yet that wed like to repatriate and if we get it we want to build something here. Warren buffett youre in this bod frank kind of fuzzy environment except now its just the broader economy, not just the banks. It feels good, the trajectory is good but we need to get it over with so we know what the rules of engagement are. And the uncertainty is still there. All the things you said are the same things warren buffett, Charlie Munger and bill gates told us a week ago. Youre hoping for better results. The bond market is the true, to me the true arbiter of the pace of this growth. The baond, the 10year bond is still quite low. 2. 40 something this morning. The bond market you could also say its not just a reflection of whats happening in washington its a reflection of whats happening around the globe. True. But if this economy were really moving forward, if they really thought we were going to get all these things done quickly the 10year would move pretty fast. And youre going to have two rises in short rates, the curves really going to flatten unless and that tells you, should be slowing the economy. I think he really needs to get dg look we dont have a labor force base that he needs to create these jobs. We are going to build bridges, roads, tunnels with American Workers and American Manufacturing companies we dont have the capacity or the workers. Im told that were in a very underemployed environment im told. Im told were so far from full employment we dont even know what were talking about. Not true. You sure . Not true. I know its not true but i have people lie to me every day on the set. Theyre older and theyve left the workforce some of them. Theres a couple million of them but its not 10 million. Its not 15 million. Its a few. Theres a bunch on disability that probably should get back working. Id like to see them get back to work. You saw that number pop. But in general, i think you dont have 20 Million People. Have some underemployed people. But theyre also working three jobs. But we have to end that. And i agree with trump we have to end the guys who are federal handouts, you know, and piling up again fits, as well as working parttime and making 60,000 and get a free phone. Thats not what this country can afford. We need to get back to work. And i think were going to crush it but weve got to get weve got to get clarity on some of these initiatives. And right now theyre all pipe dreams. We all feel good because theyre all good things for business. Right . And theyll help the economy. So im really excited about that. Everything else is a side show unfortunately. Hmm. Which do you agree with, joe . I agree with, you know, about 60 , 70 . Id be looking for some which is a pretty good number. For me thats good with you. Id be looking for wage gains. There should be wage gains. Well theyre not happening yet which is an indication that what youre seeing is not just a slam dunk. I think there are people that are that are 40 to 54 that are out of the workforce and has nothing to do with and i think when you what you alluded to it, if you can stay home and not buy a suit, and not pay for gas to go to work, and not pay for child care, and you can somehow get benefits totalling up to 50,000 a year in some states its like 58,000. 58,000. Now thats different by state. Then you also dont have the satisfaction of earned success and the dignity of work just not what i mean weve seen that playbook in other parts of the world. Right. And you know how what the end result its been fascinating and the French Elections were fascinating, right . The whole its been a its been were you surprised with how the French Election went down . I was relieved. No i guess at the end of the day the french, the one country that ive invested in that i dont want to invest in balls it is a virtually a socialist communist country, and i can say that, and its very hard to invest in france as a Business Leader because they change the tax regimes and they dont really want you to make money at the end of the day. Ill invest all over the world and its one of the most difficult places to invest. Having said that, i mean europe is moving forward right now. Asia is okay. The u. S. Is okay. Its not great. And we have to get going. And i think when we do, youre going to see great things from the economy, and people will be satisfied i think with the administration. Hes got four years. Hes like what 100 and something odd days into it. Well certainly a bumpy road. Well see what hes got for you. Well see right, buddy . Well see about that. That im not he will be here youve got 14,000 apartments . We mack 14,000. We own about 9,000. Hes been at it a long time cant say thats the only way that it looks like a small very small. But overhere. More importantly theyre actually good deals. Hes doing well for himself. Going to talk more about that in a moment. And we have had a lot of instances of and theyre heartbreaking, athletes that have made 50 million, whatever, and are bankrupt, want to talk about you made any mistakes along the way, too . When we come back the road to President Trumps 1 trillion plan to rebuild america. Well kick off infrastructure week with the head of the u. S. Chamber of commerce right after the break. And later we continue with your lineup of heavy hitters. On deck, weve got Avenue Capital ceo marc lasry and green view capitals Larry Robbins at 8 30. Stay tuned you are watching squawk box on cnbc. This is my headquarters. This is where i trade and manage my portfolio. Since i added futures, i have access to the oil markets and gold markets. Okay. Im plugged into equities trade confirmed and i have Global Access 24 7. Meaning i can do what i need to do, then i can focus on what i want to do. Visit learnfuturestoday. Com to see what adding futures can do for you. I am benedict arnold, the infamous traitor. And i know a thing or two about trading. So i trade with e trade, where true traders trade on a trademarked trade platform that has all the. Get off the computer traitor i wont. cannon sound mobility is very important to me. Thats why i use e trade mobile. Its on all my mobile devices, so it suits my mobile lifestyle and it keeps my investments fully mobile. Even when im on the move. Sign up at etrade. Com and get up to six hundred dollars. Hey. Pass please. Im here to fix the elevator. Nothings wrong with the elevator. Right. But you want to fix it. Right. So who sent you . New guy. What new guy . Watson. My analysis of sensor and Maintenance Data indicates elevator 3 will malfunction in 2 days. There you go. You still need a pass. It is infrastructure week in washington. A National Week of education and advocacy based around one message that it is time to build an america. Joining us right now is tom donahue. The president and ceo of the United States chamber of commerce, and tom, thanks for being here. Its great to see you today. Its great to be back. You know, we found an issue that the chamber of commerce and the aflcio can degree on. You think we could get the two sides of congress to actually agree on some infrastructure spending. I absolutely do. I think we can do it in a bipartisan way. I think we can Work Together to find the money to make this work from the private sector, the investment sector, and the government. And im very optimistic about everything except were going to have to work very hard about changing government rules and regulations on permitting and how long it takes to get things done or well be spending a long time talking about it, not doing it. Weve already heard from some of the members of the infrastructure advisory group, thats certainly something theyre focused on. When youre talking about infrastructure, that means a lot of different things. A lot of different projects to a lot of different people. Where do you think the money should be focused . What do you think is job one . I think there are two things to focus on. Number one, we have to focus on the big projects. The things that are fundamental to the future of the economy. The things that will employ a lot of people. The projects that on their own weight will drive Economic Growth in the future. The second thing is, we have to think very, very carefully, as we do that along with all the highway and transportation issues, where were going to get the workers. You see were a very now with people without jobs, but huge numbers of jobs without people. And if you talk to the construction people and you talk to the design people and all these folks theyll tell you that if we go to a very big increase program the question of where we get the people may be question number one. Thats a great point and not something we talk about very often. What we do hear an awful lot about is how you pay for all of it. How do you think we should go about doing that . Should we raise the gas tax as the president has said hes considering . Should we be taking some of the money that is repatriated, if we come up with a new tax plan and losing that . What are your ideas . I think you have to take all the ideas that are on the table and try and explain them quickly. You know if we went out to buy a new house, we dont generally go pay cash for it. We put a mortgage. Many people when they buy a car, which they hope to have for ten years, they pay for it over time. And thats how we have to do these major infrastructure projects. And theyre investors in the Business Community, and people in the investment community, in the United States, and all over the world, that are prepared to come here and invest their money in sound projects. So therefore we dont have to come up with a trillion dollars worth of cash. What you need to figure out is how do we pay the remember we pay our every month we pay our mortgage. Well, when you get Major Investments in infrastructure problems projects every quarter, every year, you have to pay the fee for that time to pay down the loan, or the investment. And its very, very important to figure out how to do that. The cash is there. What do we do to get the short run money . Elaine chao, the secretary of transportation, said today, or yesterday, that the government was prepared to put 200 billion into the system. Well, you put that in over some years, youve got to start. Yes, the gas tax, which hasnt gone up in 24 years on a national level, while the states have always raised their gas tax, is a helpful way to get a small amount of the money we need and well look for other creative ways to raise the money to pay down the debt. But we have got to get those investments. We dont have a trillion dollars. Tom, thank you very much for your time. Its great to see you. Thank you. Coming up when we return, if the enemy of your enemy is your friend, then lyft and waymo hitting the road together might make some sense. Details about the companys new partnership. Plus billionaires marc lasry and Larry Robbins are going to talk to us about the markets, President Trump and the business of sports. Stay tuned youre watching squawk box right here on cnbc. Back in a moment. So we can share our amazing trading knowledge. Thats a great idea, but why dont you just go to thinkorswims chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders . I know. Your brain told my brain before you told my face. Mmm, blueberry . Tap into the knowledge of other traders on thinkorswim. Only at td ameritrade. I count on my dell small for tech advice. With one phone call, i get products that suit my needs and i get back to business. At crowne plaza we know Business Travel isnt just business. Theres this. a bit of this. Why not . Your hotel should make it easy to do all the things you do. Which is what we do. Crowne plaza. Were all business, mostly. Looking from a fresh perspective can make all the difference. It can provide what we call an unlock a realization that often reveals a better path forward. At wells fargo, its our expertise in finding this kind of insight that has lead us to become one of the largest investment and Wealth Management firms in the country. Discover how we can help find your unlock. Welcome back to squawk box, everybody. Our guest hosts this morning, Barry Sternlicht, Starwood Capitals chairman and ceo, and Alex Rodriguez the founder and ceo of arod corp, and hes done a few other things in his career, too. Alex, there have been some reports that have been out there about potentially joining that group thats interested in buying the marlins. Can you tell us anything about that . Yeah, sure. First of all, im from miami. So there were some crazy rumors out there. Im here to tell you that the group is very, very impressive. Strong Balance Sheet, very intellectual. If you look at going back to the late 70s, private equity, lbls, theyre the master. The track record speaks for itself. But i want to make it clear, i was never offered an ownership or position with the marlins. But i dont want to bury the headlines here. Because, any time families like rodman, bush, jeter, wanted to pour capital into a game, thats a great day for baseball. What do you think longterm of the valuations of all these sports teams given the conversation weve been having here this morning but also just for weeks and months now on end about espn and ratings, about whether you think Regional Sports networks ultimately get pushed onto a different band on a cable on cable over the top, all that . I mean its a loaded question. I would say that like real estate you buy the best and forget the rest. When you have great brands like the yankees, the red sox, the mets, look at tom ricketts what he did with the chicago cubs. He bought them for eight and change, 850 million or so in 2009. He brought in joe madden then brought in jon lester and that Straight Line took that franchise from 850 million to some think is north of 3 billion today. What happened remember we used to talk about guggenheim and the dodgers. Yes. And they made that work. They did only make it work. Yeah. I dont know its like new york real estate. You really think that these things peak and then they never go down. They dont seem to go down. They never go down they never go back to the way they were. But the problem, of course, in sports as alex said is you do need 20 teams in a league. You cant have four teams. You know, everyone else cant be dying, and although it has worked. The payroll of the yankees have been significant. Right . And other cities like milwaukee play the game with the payroll a quarter of the size of the yankees . Yeah, i mean, look, its a different game today because the Business Model is basically as an owner you try to break even, lose a few million, make a few million. These guys are not throwing out a lot of cash, if youre able to hold it and withstand the pain for 20, 25 years history says youll do pretty well. When you talk about making or losing 5 Million Dollars here or there, whatever it is, thats with the cable contract. Thats with everything. As a whole theres 30 teams but what revenue sharing has done is brought teams like the marlins and the oakland as and minnesota, Kansas City Royals went to two world series. Our game has never been healthier. I think the one concern for our game, weve gone from 1 billion to 10 billion from 1994 when i entered to today. Post revenue. And the commissioner said he wants to get up to 15 billion. The one thing that i see that may be an issue unlike football and basketball is were losing iconic stars. We have terrific players. Id love to see our game exact some more energy and finance behind it. Why is miami both baseball virtually every sport, except for the nba i think, struggled . Well, i think look, the dolphins have a rich history going back to don shula and dan marino and the 72 dolphins. You know, they did a marvelous job of running that franchise. I think the marlins is tricky, right, because theres maybe a distrust from the fans. So whoever comes in i think you have two or three year goodwill, youre able to come in, set your team, set your infrastructure, get a tv deal which is not good. Get a radio deal that is not good. And if you just look at the radio deal and tv deals between dodgers and compare them to the marlins that right there, you can figure out that problem, thats a good step. Thats also insurmountable problem. With the audience its not that big. The question is whether the contracts, the tv contracts continue or drive than driving the value. Right. Of all these sports franchises and whether they continue to sky rocket, and whether these companies these channels that have taken sports, will they dominate, will they have the capital to keep paying ever more for these events . Not just true of baseball, true of the olympics and other events that have sort of been disaggregated now. Theres so many options for consumers. I dont know if these contracts keep going up. I dont know if nbc, cbs, same thing with golf, we dont know if these sports but the expectation is that the dotcom players may jump in and spend more money, that google it is content at the end of the day. Its content, like a movie. Just happens to be this one and the game, you think about the 1960s we had about 25 Million People watching us live. When i entered the game in 94 there was around 60 million. Were up to about 75 million to 81 million. I think this year we had over 81 Million People watching. Thats good because if you look at the value of the contract in those years, 94 to today probably gone from 100 million to 8 billion. Like the tv contracts. So its followed that. It reminds me of real estate. They talk about retail on fifth avenue or madison avenue. These stores will stay full but their rents will come down. Were going to go to break. People will watch we need a designated hitter. Some management strategy, pitchers got to hit, you know, would be when do you pinchhit. When do you pull i mean that was the biggest mistake. Anyway, coming up, just when you thought our lineup of allstar newsmakers couldnt get any better, two investing titans are on deck, marc lasry, Larry Robbins will join us on set right after the break. Stay tuned. Squawk box will be right back. counting for hide n seek. ready or not, here i come. Anyone can dream. Making it a reality is the hard part. Northrop grumman command and control systems always let you see the complete picture. And were looking for a few dreamers to join us. Good morning. Welcome back to squawk box right here on cnbc live at the Nasdaq Marketsite in times square. We want to get to our panel of allstars. Already having a little too much fun this morning. Marc lasry, ceo and cofounder. Larry robbins is here founder of ceo of Glenview Capital management. Also chairman of robin hood. Barry sternlicht and arod, former new york yankees player but ceo of arod corp. Weve learned he is a real estate mogul in the making. You call yourself jv but im giving you varsity right there. Thanks. Wee want to talk to everybody here. But i want to go to larry first, because tonights a big night. Youve been trying to sell tickets by saying that arods going to be there. So lets try you could see arod, too. Arod is going to be there too. Tell us what tonight means for those uninitiated. Sure. First of all im pleased to be the 11th chairman of robin hood which is a 29yearold organization. Barry and ten other great leaders preceded me. And tonights an important night because we will hope to build upon the challenge grant that ken griffin from citadel gave of 15 million in order to invest in both love and leadership. Robin hood funds over 200 Community Partners in new york city solely for the purpose of fighting poverty, elevating educational standards, elevating living standards, for our neighbors in need. And unfortunately theres 1. 8 million in poverty you guys raise a small fortune every year when you do this dinner. Weve been privileged to be at. What did you raise last year . I believe it was 61 million raised last year. We also invest a small fortune. So the truth is, is that the beauty of robin hood is that every dollar raised in one year is an investment in the community the next year. And so, unfortunately, its not like were building a building where we can then say the buildings done, the investment is done, we can all breathe a sigh of relief. Because the needs are persistent, therefore our fundraising needs are persistent. And so were exceedingly grateful for the generosity of people last year helping us raise 61 million. We, of course, hope to raise a big number again tonight. Right. But we also are gratified by the fact were celebrating a new incoming leader. Wes more great. We appreciate you doing that. So were excited about tonight. One of our cochairs, alex is sitting next to me. So it will be a star filled room and hopefully an exciting event for the most important thing will be to shine a spotlight on the work. Lets talk markets in between all of this. Because i want to talk to lasry over here. Sure. When we first saw you at the beginning of this year i think that this was going to be a 10 up year. Yes. In the markets. You want to change this is your opportunity to call a friend or change your view. Where is the market up now . Im more than half right, right . More than half right. You want to know if youre still also said at the time hes not an equity guy at all. Thats true. Thats true. Didnt learn anything last time when we were youre just why do we care what he thinks about stock . Well to your point you would be the first to say thats not your thing . Id be the first. I think what ends up happening is the reason why the equity markets would be out, just suddenly because the economys doing well. And everybodys been pretty positive about whats happening, and deregulation. So you thought at a minimum thats what it should be. Just when you look around, most businesses are pretty excited about whats going on. And people are starting to reinvest in the economy. You think the markets have the cut in it already . Do you think into the pop in the equity markets . I think it was more in the beginning. Yeah. I think now its gone down a little bit. Because i think its going to be hard. I think its going to be tough to get that thing passed. They get it done this year . I hope they do. I mean id like them to Corporate Tax. Yeah the Corporate Tax. I think the Corporate Tax they should be able to. Larry, where do you land on that . You are a real equities guy. This pretender over here all stressed we can do that, too. I thought it was funny mark said he hopes it gets done, and one provisions and tax reform may be that you cant deduct corporate interest expense which will probably create more distress for companies so maybe thats why marc wants to get done so he can have a supply more distress to get creative. Look the markets trading about 18 or 19 times earnings. Were in a low growth, low Interest Rate environment. We know that expectations since the election have gone straight up both consumer and business confidence. We know that the First Quarter gdp numbers, and in fact First Quarter Consumer Spending numbers did not go straight up. They went the other way, and so that rubber band between the expectation gap and the economic gap will get resolved as we move through the year. Most likely the truth lies somewhere in the middle and most likely marcs characterization of the market is correct, well likely grind higher. What we do and what many do is not try and figure out where the s p is going to be but find value underneath. Were finding lots of value with companies that are keeping focused on executing their own businesses, growing and in fact we think m a is an increasing driver of earnings per share and value per share were focused on a lot of internal growth stories that also let me ask you because you raise a lot of money from the Hedge Fund Community for robin hood. Hedge Fund Industry has gone through a bit of a rough patch and maybe im being even polite about it, in that case. Sure. Do you think that weve had a turn here in the past couple of months . Look, i think you had a period from the middle of 2015, through about february, about february 21st plus or minus, you know, a few minutes, of 2016. Were all hiding under our desks back then. And where people were valuing stocks based upon who owned them. Or based upon the q sheet they were in or Balance Sheet rather than about what the companies did and since then its not just in the past few months, frankly if you look at both Hedge Fund Performance or even just active manager performance, since march 1st of last year, right, that of course is then coming selfcorrecting. Ultimately buffetts comment that the markets a weighing machine not just a voting machine is accurate. It just depends on your time horizon. Hedge funds are criticized for shortterm thinking, for asking investors to wait over a psych until order for the returns to be there. Ultimately, you know, theres of course a lott of hedge funds, and not all of them will be of equal quality but i think the concept of active management that people will invest their capital where its best used but engage those Companies Actively as owners i dont think thats dead a year ago today or 100 years from now, i think thats a timeless business. Marc, where are you putting your money . Youve been around europe a lot . Yes . That chrome thing came as a surprise to you . No. You were surprised on brexit though. Yes. Yeah, we were. But i think hes i think calling for i thought with an accent look i think the opportunities in europe, youve got far more opportunities in europe than you do here. And the simple reason is there is a lot more stress on the system. So there you have the ecb trying to deleverage the system. So thats actually yeah for us, we are able to invest out there. There just isnt that much what did retail europe, u. S. . I would say its 70 30 right now. Wow. Are you thinking that youre going to be able to start buying up retail bonds like crazy . I think so. The bonds of Retail Companies . Yeah. You think the whole Retail Complex is about to fall to paces. Would be an interesting place i think on the equity side retails gone down quite a bit. I think on the debt side its starting to. So were probably still about a year away for the opportunities for us. You dont feel that in the commercial real estate . You know, i was looking at some numbers in the malls. Our sales are down 0. 6 across 24 malls yeartodate in the end line stores which is what a mall owner owns. We dont own the anchors. Theyre owned by federated or now macys or dillards, sears, we actually with all due respect to sears, theyre usually the weakest performing store in the mall. We would like them to go away. Wed like to buy their box back and put an apartment store somebody in there. In a mall in texas we put in a crayola experience, which is a new concept. Equinox. We put in a cineplex, new huge movie concept, and the malls doing great. So i mean, its an evolution. Barry, you tend to be in the top category of malls though. Yeah the bad ones are going byebye. Do you think as an issue of foot traffic or just the rent weve outrun the rents because theyre getting too expensive . The foot traffic is trending down. But people are smart about the way they shop and it depends where it is. You have destination retail. The whole every owner of a ret retail in lincoln nebraska. How do i get people to come into this mall or come into my store . Im going to have to change what i do in this store. Youre seeing this thunder bolt of amazons accelerating the whole process. Some will figure it out and some will blow up and hell be dancing in the streets with the debt and ill be calling him up to restructure these guys. So can we go to larry on some of the equity ideas . He has some really good equity ideas about the debt ive been talking about the stress test so i had the privilege of doing the conference a week ago and we talked about three particular names all of which kind of illustrate this example of companies that not only are growing but are doing transformative acquisitions. Unfortunately, over the last couple of years, announced deals take forever in order to complete. Dow and dupont in november of 2015 said they were going to merge now we think maybe in august of 17 they might actually be able to do that. And one of the conditions was they had to sell not only a business, but 15 compounds from their r d pipeline to somebody who could develop it to become a competitor. What a great opportunity for fmc who got to buy that for about 3 billion to not only get an advantaged acquisition from a buying a distressed asset from a distressed seller but also to get the compounds so they have pipeline of innovation for the next ten years their earnings which are about 3 this year are going to be about 5. 5 or 6 in 2018 so while were all trying to figure out how do we make an extra 5 or 3 or 10 there are Companies Like fmc or dxe technologies performance who are literally seeing their earnings double over a couple year period as a result of these transformative acquisitions. A company weve oend for a while thermofisher scientific today Just Announced 7. 2 billion transaction. Weve owned them continuously since 2003. I dont want to give hedge funds a bad name but yes we did own something continuously for 14 years and its one of a series of successful acquisitions theyve done there where theyre deploying capital logical in the strategy, in this case its 3 accretive and it extends through capital employment. We would just encourage people as theyre doing their own work to find companies that are not only growing in this economy that we are not sure whether its going to accelerate or decelerate in the next twelve months, but also that theyre doing the things internally to accelerate earnings growth. I think you got caught off before one of the other questions do you believe what premium do you think is in the stock market just broadly speaking when it relates to the policy the legislative policies that are on offer investings like not like olympic diving like in olympic diving you take the dive and multiply by a degree of difficulty score to get a total. In investing whether you answer a difficult question or an easy question all you get is the score. So quite honestly, whether theres 3 or 4 either way in the market or not in the market for tax reform its a very difficult question to answer and were not really trying to answer that one. My best guess is that when the first time that repeal and replace couldnt get out of the house, most people assume that no legislation was going to get passed this year. So whatever deflation of the tax reform premium that was in the market maybe early in the First Quarter i think that the wind has come out of the sails a little bit. All right. I think the odds have to be now less than 50 that were going to get tax reform this year so its certainly something that needs to be addressed. Totally different topic for lasry, i dont know if you talk about sports. Sports valuations but since you own a team youre in this with him right . Yeah. Huge, huge, huge. What do you think is going what do you think season tickets oh, no. One seat. What do you think of the valuations of sports teams in an era where there seems to be pressure on ratings and questions about the valuations or the cable deals that may come in the future for Regional Sports networks . I think theyre actually only going up. All seriousness you sort of look at all these teams what everybody wants is live. So whether it ends up being you may see that cable, you know, so cable is going down a little bit. But that amazon or google or any of those companies talking about earlier. Are going to want that. Its just the thirst for Live Programming is just huge and i think what were seeing, for us is were just starting that in trying to do deals with google or trying to do deals with sort of amazon or all these different groups out there. There are going to be broadcast deals, yeah. So youre going to find that in lieu of what the it will end up being in lieu of. So our deal now is for the next ten years. Wont the networks push back and try to get exclusive right you going to play an nbc or an espn against a google ultimately . Ultimately, thats where it is. Eight or nine years from now. Because youre locked in for the next nine years. Thats the biggest market cap. Remember, if you if you sort of remember when we the last deal that was eight years ago or im sorry, nine or ten years ago was at a billion i think it was 900 million. Everybody thought at the time they the last cable the last nba contract was 900 million and the new one was 2. 7 billion. All right, so i think theres room ten years. Short it at your own peril. I think its a blast owning nba teams. Marc lasry, thank you for coming in. And larry, thank you. If you dont have tickets, can they still get tickets for real, larry . Tonight. Yes, a few tickets. If you dont like any of us, coldplay is closing. Come see coldplay. Thats a good close. Absolutely. Yes, we would welcome it, robinhood. Org for those who want more information. Arod is sticking around. Barry is sticking around. Were back with a lot more in a moment. Thank you very much. Brian, i just need to know if the customer app will be live monday. Can we at least analyze customer traffic . Can we push the offer online . Brian, i just had a quick question. Brian . Brian. Legacy technology can handcuff any company. But yes is here. Youre saying the new app will go live monday . yeah. With help from hpe, we can finally work the way we want to. With the right mix of hybrid it, everything computes. A 10speed directshift 5. 0transmission. Ine. A meticulously crafted interior. All of these are feats of engineering. Combining them with nearperfect weight distribution. Is a feat of amazing. Experience the firstever 471horsepower lexus lc 500 or the multistage hybrid lc 500h. Experience amazing. Are you ok . What happened . Dad kinda walked into my swing. Huh . Dont you mean dad kind of ruined our hawaii fund . I thud go to the thothpital. There goes the airfair. I dont think Health Insurance will cover all. Of that. Buth my fathe without that cash from aflac we might have to choose between hawaii or your face. Hawaii what . Haha. Hawaii you might have less coverage than you think. Visit aflac. Com and keep your lifestyle healthy. Aflac up next well wrap up our special hour of news makers. We have a lot to talk about with Alex Rodriguez and larry sternlicht. Dont miss steve eisman, he bell on fast money tonight at 5 00 p. M. Eastern. With this level of intelligence. Its a supercomputer. With this grade of protection. Its a fortress. And with this standard of luxury. Its an oasis. The 2017 eclass. Its everything you need it to be. And more. Lease the e300 for 569 a month at your local mercedesbenz dealer. Mercedesbenz. The best or nothing. The power of a low volatility investing approach. The power of smart beta. Power your clients portfolio with powershares. Before investing, consider the Funds Investment objectives, risks, charges and expenses. Call 8009830903 for the prospectus containing this information. Read it carefully. Distributed by invesco distributors inc. Ciits where we end up. T,on. Read it carefully. Expedia. Everything in one place, so you can travel the world better. Well wait. What did you think about her . Morrow. Its definitely a new idea, but theres no business track record. Well, have you seen her work . No. Is it good . Good . At cognizant, were helping todays leading banks make better lending decisions with new sources of data so, multiply that by her followers, speaking engagements, work experience. Credit history. That more accurately assess a business chances of success. This is a good investment. Shes a good investment. Get ready, because were helping leading Companies Lead with digital. Our guest host this morning bernie sternlicht and Alex Rodriguez. This is what i want to talk about, who will host a new primetime cnbc show called back in the game. With okay, so strahan is the executive producer. This is about this old story about guys that make a lot of money in sports and tragically or sadly seem to squander it a lot of times they get taken advantage of by guys with bad investments, right . You do. If you look at the data, joe, its pretty predictable. You make 90 of your money from age 20 to 30. Right. Less than 5 of the guys have a college degree. And you know, what happens from age 30 to 80 . And if i had just that information alone, im not a stockbroker you have done really well. Have you had people come to you with things that you knew werent going to pan out and did you ever go with one of these you know, you dream about something and you were taken advantage of, did that ever happen . Absolutely, joe. It did . Any athlete i played for almost 23 years and i loved business for a long time but i wasnt seasoned. I didnt have an aplus team around you. You find you overpay for stuff, you get the wrong debt structure, you pay a little bit too much. You dont give yourself a safety net. And you strike out and you get a better team and hang out with barry. I can partner up with really great and smart people that are smarter than me and i think one plus one equals three. I hope we can give athletes a place to put some of the 340 knee think about every player. If youre 19 or 20 and 10 of your money you give to barry and you can only touch it at 45, were making a bet that joe will make better decisions at 45 than at 25 and my money is on barry every time. Im not going to steal from what you cover on the show. So there must be five rules that you should there must be ways to spot people that are trying to take advantage of these guys. Hire your family. They often do that, right . Thats one. 99 of the answer should be no. The other basic things, right, theres no personal guarantees. Its the guarantee that crushes you every time. And, you know, you have to be aligned with your partners. You dont know what youre doing, you give the guarantees away. You see it in real estate. Personal guarantee, you guarantee the debt. You dont think about it, hey, you guarantee this, i want your house and your kids. When things are going fine, no big deal. Its not the equity that gets you in trouble, but the guarantee that gets you in trouble. Youll be on again. You well be back and get hold on, arod will be back too. Hes coming back. Well see. Arod has a lot going on. I gave you the closing moment. Yeah. Actually, i did. Gentlemen, thank you both for being here. A pleasure. We do appreciate it. That does it for us. Right now, time for squawk on the street. Good morning. Welcome to squawk on the street. Im Carl Quintanilla with sara eisen and david faber. Cramer is on assignment. The market takes stock of the global cyber attack, the north Korean Missile test and a final wave of retail earnings that are headed our way this week