Transcripts For CNBC Squawk On The Street 20151130

Impending homes later this hour. Black friday numbers are in. Cybermonday deals are in full swing. The u. N. Climate change conference kicks off today in paris. Well take you there live for the latest. Amazon with a sneak peek of new delivery drones and taking a shot at regulators saying theyre ready to deploy when they have the regulatory support they need. First up, indications are that the Holiday Shopping season is off to a tepid start. Americans spent about 12. 1 billion over thanksgiving and black friday. Thats a decline from last year. The National Retail federation says more people shopped online than in stores, choosing not to wait for todays deals. A lot of these numbers are surveys. A lot of people throwing some shade at the quality of the number. Dont take it to the bank. You cant. I think at one point it was easier when we said, look, we can pick 20 malls and decide how things went. Look, i think it was an Amazon Holiday season. I think it will be today. I dont know if you looked. The deals i was surveying this morning what you can get. Walmart, too target. Theyre offering such theyre making it so compelling, it making you feel why go to the store . Why deal with the parking . Apple had a very good holiday season. They offered some products that well have to talk about. Maybe the watch is bigger than we think. The new pro, the new ipad, which i got and binged on a whole new netflix series. I feel like you can even think about going down the food chain to look at macys, where brian had an interview with terry lundgr lundgren, he said the numbers look good. I feel better about the holiday season. All we hear about is empty malls. You usually like to look at malls. I dont know if you did this weekend. I did. I spoke to people who do it professionally, others who did it because they were curious or looking to shop. Again, you cant take away conclusion, but the trend that has been in place seemingly is only growing. And that is more mobile, more just online and less people actually visiting the mall. People are much more comfortable ordering clothes on the mobile than they used to be. People used to feel you have to try them on. Listen, got all my data about who i am in facebook and what my dimensions are i can order anything and easily return it. Yes. The mall was a place to go to enjoy and try things on. I dont think people find it as enjoyable. They dont need to try things on as much. We have some downgrades. Fbr cutting lulu. Lulu, the weather did not get chilly in time. Lulu has a lot of inventory. Theres an undercut for under armour. My problem is it got cold. The cold weather can move a lot of inventory if its done right. Sales can move inventory. Thats what really moves inventory, markdowns. Lulu is a name that people are not in for the earnings. The markdowns can be big. You mentioned macys earlier. What about the markdowns there . Sometimes a stock at 40 when it was at 72. I went to hear someone, stock down 72. The stock has done a lot. Balance sheet is okay. If Terry Lundgren is speaking more bullishly, thats one you want go to. But a sales number that looks okay for some of these retailers now who are getting rid of inventory does not translate into big profit. Only for tjx and ross stores who buy the inventorinventory. The deeper discounts will hurt gross margins. A lot of hot money in that stock. Thats not what you do you dont buy retail for takeover. Its going to be an incredibly busy week. A lot of Economic Data led by the jobs number on friday. The last up with before the feds december meeting. Ecb set to hold a policy meeting on thursday, see if the fed unveils new stimulus measures. Opec on thursday, Cartel Members urging saudi arabia to cut production in the wake of lower oil prices. The russell up 3. 5 this month. The dow, nasdaq and s p each poised to pose a second consecutive month of gains. Even though for the year to date well waffle back and forth between the flat line. I think about the endless stories that we read about how the saudis have to change their view and have to cut back. Always other opec members want them to cut back. Today theres a Bloomberg Business story about how saudi borrowing rates soar in december. Look, saudi arabia wants low prices. Thats what they want. Thats what they get. Pumping in a huge amount. They had a series of companies over there to explore new ways to drill in cheaper fashion. I think this whole idea that youre going to see crude go up big, i saw upgrades this morning, based on the idea that crude is finally ready go up. Dont do it. Dont make any bets that oil will soar from here. It doesnt seem likely. Not with the production were putting out. That includes any possibility of any more airspace incursions, more attacks. I dont know. Here we are seeing whats going to happen with iran putting out projects for bid. Doing very good terms this time. Its not the original iraq deals which were not that good but still enticed people. I think oil give or take a couple bucks has bottomed. But its lower longer is the way to think about it. Its like Interest Rates, lower longer. We cant get up to 50. So we hang around. We hang around. Those who cant, all these different private Equity Companies that have so many different pipelines that they thought they could bring public, those are the ones we have to start counting down the days for. Notably absent thus far have been the bankruptcies that we might have seen a year ago. But weve been living with low oil prices for a little bit of time. If you said a year ago theyll be right here now, i think we would have expected more. Doesnt mean theyre not coming, but theres more flexibility within the capital structure to keep these things going. Not to mention the point, you made many times to be able to produce another a lower cost. 2016, we will see the year of reorganizations. You have not mentioned natural gas. Before we took the break you were mentioning it. The utica shale . Southwest pennsylvania, largest fine in the history of the world. History of the world. The world its insane thats going on there. Reserves that may never get to be burned at all. Oil is so long, i dont know how many people can take the natural gas. Im talking about a developed fine. A fine that you can pump at a dollar. It takes the whole northeast and says listen, we are uneconomic at two bucks. Theres a field at 1. When i say large, largest economic field. When Companies Announce the finds, stack goes down. Were in that weird phase, its like the old days, when you hit a gusher in the gulf of mexico it was great. Now its can you hide that . Texas gulf sulfur. You dont have much hope here in this oil patch. Those who keep thinking well get a break here, youve had it. Youve has it. That chevron run, enjoy yourself. The exxon run, congratulations. Still among the worst stocks on the dow for the year. Except walmart and amex. Walmart. I have to tell you, i always pull for youre not supposed to pull for people. I pulled for denver last night. Youre a referee, man. I like this walmart. The website has gotten better. It has . Just in the last month . Yeah. It has. Havent been on it. Things improve. There were teams that would never beat the eagles that have beaten eagles . You think walmart cant turn around . So walmart is tampa bay . Is that what youre saying . Yeah. And hes winston . I think walmart weve seen things like kansas city chief the lose almost every game at the beginning and make the run. Walmart is making a run. It could go to 61. I think 62. Okay. Thats three points. Its the nfc east. Thats enough. Exactly. All that discussion leads to us this u. N. Climate change Conference Today in paris. Obama attending as well as leaders from over 100 countries. Steve sedgwick is in paris with the latest. Good morning. Reporter good morning to you. Its an interesting meeting for the french hosts in paris because it was only two weeks ago we had those devastating terrorist attacks in the center of paris that cost around 130 lives. That is where the president went first when he got to paris. He laid a rose at the bataclan concert hall as well to just commemorate that horrific event there. He and other leaders came here today to the site where lindbergh landed after his first transatlantic flight in the late 20s. Quite a Historic Site. Its now a u. N. Secure zone. Security is tantamount for this event with the 150 plus leaders here. Not only president obama, but president ji. You have erdogan and putin here as well. No talks between those two to lessen the tensions between turkey and russia. Clearly the president has come here with a message. A message which is not particularly popular with some, but a message which he says is americas answer, theyre responsible for a lot of the carbon in the atmosphere and says now is the time to act. Lets listen to what the president said about the argument and where were at regarding emissions in the u. S. We have broken the old arguments for inaction. Weve proved that strong Economic Growth and a safer environment no longer have to conflict with one another. They can work in concert with one another. That should give us hope. Weve broken the old arguments is what the president said. I think a lot of people in the gop certainly people representing states in wyoming, in west virginia, in texas, heavy coal and oil states as well, they dont think the argument has been broken as well. They think that the Clean Air Act is being used by the epa for this clean power plant of obamas and has overstepped its reach into energy arenas. The argument which the president says has been broken back home, i think there are many people on capitol hill and elsewhere that might want to disagree. If he gets the deal here, he still has to sell it back home. Back to you. Steve sedgwick, thank you very much. When we come back, a look at amazons new drone Delivery System and why the company is taking shots at regulators. And Roger Mcnamee will join us. Look at the premarket. If november ends positive t is the sixth positive month of the year. More squawk on the street live from post nine in a minute. Not afraid to fail. One e some of these experiments may not work. But a few might shape the future. Like turning algae into biofuel. New technology for capturing co2 emissions. And cars twice as efficient as the average car today. Ideas exxonmobil scientists are working on to make energy go further. No matter how many tries it takes. Energy lives here. Its a drone, after rising vertically like a helicopter to nearly 400 feet, this amazing hybrid design assumes a horizontal other yentation and becomes a streamlined fast airplane. Amazon in a promotional clip narrated by jeremy clarkson. The drone carrying a box of soccer shoes and delivering it to a family in about 30 minutes. Amazon hasnt said when it wants to have the drones in service. Its all pie in the sky until it isnt anymore. Sameday stuff was amazing. I dont rule anything out. I remember when retailers were angry because they were playing with funny money. Amazon is immensely profitable. If they want to have drones, maybe there will be designated fly zones. Saying the Retail Service is immensely profitable the company is. Depending upon what they want to show this costs money. They shut this operation down. No doubt. They spent lots of money. He is always about future cash flows. He said that from the first letter he wrote when the company went public. What they invested in is logist logistics. To our conversation earlier why not just order it online when you know you may next get it the next day or two. Can easily send it back. Zappos also. Whoever thought they would buy shoes on the internet. Theyre making so much money and this is just another example of what we can expect in the future. When that future is, i dont know. I only buy shoes on the internet. I used to go and try them on. I know my size. I love that they have to put up the words not simulated. They are putting pressure on u. S. Regulators, the faa for not moving fast enough. Right now the operator has to see the drone. Clearly not the case here. Its the same dynamic as selfdriving cars with municipalities. The logjam will come in how the government responds to that. I always worried about the security aspects. It doesnt seem to come up. I remember when we were looking at a drone at the San Francisco the bureau in San Francisco. Everybody was looking at it. Theres a drone outside. My first thing was okay, like 24 or strike back some of the things or jessica jones. Check that one out. I will. Yeah, scifi. Its not scifi. Yeah. The real world. Comes on the heels of bezos creating the first reusable rocket through blue origin the other day. Were just pedestrian people. Do we have any great ideas among the three of us . Honestly. Any idea when i have them, i forget almost immediately. Sometimes i suggested a son on the way to commercial. Okay. Thats good. I love music. I came back from thanksgiving holiday, only to find out that im an idiot and old. Youre not an idiot. The other thing maybe. Well get cramers mad really mad dash now as we count down to the opening bell. Look at the premarket on this monday. A lot in store over the next five sessions. More squawk on the street straight ahead. Time for mad dash on a monday. Full week of trading this week, to too. The sun king, david, probably didnt realize it he has ten potential ceo candidates for yahoo responding to multiple requests for who will run yahoo . There is a ceo at yahoo . There is. Forgetting h intin inting his l analyst puts something in print like this, doesnt that mean something regardless . Yes. If there is that much discussion, where theres smoke, there tends to be something going on. You could say bob peck is answering his clients suggestions that there has to be a change at the helm. David, i turn to you. Starwood is more than in the crowd. The latest is dont do the alibaba spin after they have said they will do the alibaba spin. That will happen sometime next year. What do you think depends on the multiple you want to put on the declining core business. Zero times x remember that . Thats the only thing. Stay focused, this list, which is kind of a list of people right now who are injured reserve, some physically unable to perform, other people are on practice squads. Theyre all there. A list of ten candidates. Its been a terrible year for the stock. I dont know how many value there is. So much more focus on it than you would expect for a company that will be very, very small. Right. Be aware that the other guys are not selling. Google and youtube may be very good. David, you want positive mojo . Great karma . Please. Ulta. Theres a reason i mention Companies Like ulta. Jpmorgan goes from 1. 80 price target to 2. 15 what cant be done by amazon even with drones . Tell me. Thats a quiz, watson. Cant make up your hair and face and all that stuff. You cant go to the Amazon Beauty parlor. At least not yet. Drones cant cut hair that ive seen. And thats why ulta is the most unamazonible company on earth thats in the oxford dictionary. You cannot amazon ulta. You can uber it. I dont know if you can uber it. You cant lift it. Can you airbnb it . No. Its not a unicorn. Its a stable of capital. Ulta, david, the key to this market. Well, there you heard it. You can turn off your sets now, though we have an opening bell coming up next on squawk on the street. Proud of you, son. Ge a manufacturer. Well thats why i dug this out for you. Its your grandpappys hammer and he would have wanted you to have it. It meant a lot to him. Yes, ge makes powerful machines. But ill be writing the code that will allow those machines to share information with each other. Ill be changing the way the world works. interrupting you cant pick it up, can you . Go ahead. He cant lift the hammer. Its okay though youre going to change the world. Youre watching squawk on the street. The opening bell in a minute and a half. A lot of longawaited veeevents coming to fruition. The last jobs number before the fed meeting. A lot of things about draghi. Draghi is doing everything himself. I saw they wrote a check to turkey for 3 billion. Im talking about big projects in europe. Other than the auto industry, anything he can keep doing . We dont hear talk from politicians about that. About the strong dollar . At the same time, trying to sell any sort of commodity, youre kind of gonzo. Its reverberating, industrial american in a significant way. And it will only continue if they keep pressuring rates over ther there. I think draghi is an amazing story. We will get to 2 to 3 growth. No help from merkel. The Climate Change conference is interesting, they have to make a deal with russia. Got things started again and i dont hear it happening. Not a lot of hope going into the summit. Opening bell, at the big board, csc celebrating its merger with csra international. At the s p, blue nile. I think its interesting the online jeweler, signet, zale, kay. Thanksgiving was so late. Just the window of people forgetting about the holiday. I wonder if we dont see big sales from them. If you sell on the web, they had letter w on squawk this morning. They were talking about good sales. Battlegrounds. All that kind of stuff. Gopro, battles going on now. Battles. Fedex sees three peak days this season, december 7th, december 14th and today. Looking for 12 volume growth. Unbelievable. This is the u. S. Economy. Double digit growth in commerce . Incredible. Well, reflective of what weve been talking about all morning. I wish the United States post office would offer some projections. Theyll lose money. Ill project that. U. P. S. Had a not great quarter, the stock doesnt come in at all. Amazon up, which you knew would happen. You knew netflix would go up. These are unstoppable forces. Between now and yearend, managers have to show they own amazon. Its too risky for them not to show that. Remember when people used to short amazon on the cash flow. Of course. Its amazing to look at the company now. 318 billion. Apple cant get out of its way. I thought it had a good holiday season. Dont sell it. Just saying. Amazon i was on amazon a bunch of times this weekend. Probably a half dozen times. That many times . Yeah. Checking bargains, seeing what to do. My daughter sent me a list, i sent her a list. I send her my amazon gift list. Im tired. Heres what i want. I want the primo levy complete package. The kershaw 1919 world war 1 to world war ii. Heres my list. I dont want her to spend a lot of time. Amazon gift. There you go. On friday, jim, when you werent here, carl and i were, we had the media stocks get hit again. Yes. This on the annual publication it is the annual report of disneys 10k. Comes out around this time of year every year, around thanksgiving. In it, people focused on neilsen numbers. A couple analysts were on, others have shared their thoughts on it as well. Not necessarily new news. People saying we knew this. The stock was under pressure on friday. Yeah. In part because of that number, simply exacerbating the fears already out there about cord cutting, cord shaving. The idea of the skinny bundles. While you still count a sub you dont know how Many Networks that particular person is taking in their socalled package. Its the changing economics of the business. Slowly perhaps in some ways, but a focus. The stock today a mixed bag. They were all down sharply on friday. It is kind of jarring to see that big decline over a couple year period, in people who take espn. People say those are neilsen numbers. Everything with neilsen is a sample. Not just the real numbers. Bob iger did not see this coming. Look at the acquisitions, its not like he doubled down on cable. He doubled down on movies. Movies have a tremendous intellectual property that he can manage. I cant wait for star wars. Pixar, lucas film. Were all going to see star wars. I did not get my tickets early enough. Because all the big places are sold out. Hard ticket to get. This is a movie. Im going see miley cyrus and bono, easier ticket than star wars. Is it . That looks like an interesting show. Some reviews can you take a picture of yourself when youre there . I dont im the oldest person there. It will be easy to point me out. Seeing movement in defense today. Barklclays cuts ratheon, and General Dynamics is upgraded. Ratheon, stock down four. They made an acquisition, they havent announced how they will rationalize it. If you want to sell Lockheed Martin down four, i would suggest you buy it not sell it. The stocks are in a zone for 2016 thats extraordinary given for what they make. That matters. You mentioned the apple watch. We know what its done for target. Com. Youre wearing yours now. Usa today this morning has a list of tech turkeys for 2015. And they call that the top one. Along with fios, chip credit cards and the steve jobs movie. Look. No, its dark again. Does it have everything we need right now . No. There was an article about two upgrades of fitbit today. Youre persistent. He gave up on his about what was it, carl . Three weeks . I tried it for a week. I like it. You kept this thing on your wrist. I like it. You keep insisting that it does something for you. I get a kick out of it. I got the new band, black band. I feel more like daniel craig. That was long. Lets get to bob pisani and see whats moving on the floor with the dow almost perfectly flat. Hey, bob. We have modest gains. 9 of 10 sectors on the upside. Healthcare is the only sector to the down side. Tech has respectable gains. I want to talk about retail. Theres a lot of contradictory numbers, trying to sort it out for you. The key headline that everybody talked about was the number with sales down 12. 1 billion from 12. 29 billion. That seems like a disappointment, but the National Retail federation is keeping the holiday sales estimate for the total season up 3. 7 , even though the methodology has changed. Thats respectable. Were talking 2 gdp. I thought the online Sales Numbers were impressive. Adobe said online sales from thursday to saturday were up 19 . National retail federation, this was a great headline. 103 million shopped online. 102 million shopped in stores. For the first time online had more shoppers than in the stores. Online sales probably even with a 20 gain, probably not about 18 of total retail sales. There were pockets of strength. Reports of pretty strong foot traffic at jcpenneys, bath bod works, victoria secret. Macys reported 15,000 people outside the store, Herald Square store in manhattan, similar to what they reported last year. Of course macys with a terrible year overall. One of the problems on days like today, cybermonday, the big stocks, Department Stores dont do as well. We asked our friends how do they do on a cybermonday . This is buy it on friday, sell it today at the close. The s p in the last ten years, is down an average of 1. 2 . The big Department Stores, kohls, target, sears, macys down typically 2 to 3. 5 today. Only up one out of ten times in the last ten years. You can see here are they usually to the upside. This is not typically a good day for the Retail Stocks overall. Why the poor performance . A lot not advanced on their cybersales. It reflects that on days like today. As for amazon, it only trades positive 50 of the time in the last ten years. But thats not happening today. Its up strongly. Up 120 for the year for amazon. About this Staples Office depot deal. There was a report in the post that the deal may be blocked. We dont have confirmation of that. They have until december 8th to make a deal. Staples, office depot is trading close to 7. The implied value of the deal would be close to 10, so theres a big risk premium built into that. A lot of talk of divestiture here. I dont think we heard anything on the Conference Call for the earnings situation. They said nothing. This has been a news vacuum. I think we need to wait more before we make definite conclusions. China will be important tonight. We mentioned this a couple weeks ago. Tonight at the close, all the u. S. Listed china stocks will go into the msci indices. Stocks like alibaba and badu and seatrip ctrip are not in the big indices. So indexers who have to buy these stocks, like the een, emerging market index, have to buy these stocks in fairly large numbers, maybe three days of volume at the close tonight. I expect fairly large volume, maybe some upside in terms of the price. The important thing is these indices will be more representative of the new china, the tech china, not the Old Industrial china. Thats good news for investors overall. Carl, back to you. Thank you very much. Lets get to the bond pits t will be a busy week for Rick Santelli as well. Especially that jobs report. As we look at tens, basically unchanged. The glide path of Interest Rates has been compressed and slightly lower in yields. If you open the chart up to july, look at the pattern here. Yes, were higher in many ways, especially when in the context of a Central Bank Going the other way, thats in the form of the bund. Look at the difference in patterns, that pattern also starting in july. Foreign exchange is where all the action is at. The dollar index overtook and closed above 100, as you see on this chart. An event thats pretty rare. Only happened on one occasion in march. It also happened, of course, pre2003. As you see on the next chart. And if you wanted to put this in context between mario draghi and janet yellen, especially with the big event on friday that could rubber stamp an Interest Rate normalization, look at the euro. 104 and 105 handles are crucial. After this break well have chicago pmi. Thats another number that traders pay close attention to. Carl, back to you. Well see you in a few minutes. Still to come, the ceo of fis ashg fis, a provider of Payments Technology will join us. S p 2088, the dow down almost 22. This is judy. Judy is 65 years old. Her mortgage payment is 728 a month. Thats almost 9,000 a year now judy doesnt think that shell be able to retire until her mortgage is fully paid off. This is mike. Mike is also 65 years old. His monthly mortgage payment was 728 a month. Now mike thought he would have to work for another 12 years until his mortgage was paid off. And then mike heard that a reverse mortgage may help him. He called one reverse mortgage to get the details. Mike retired immediately after getting his one reverse mortgage loan. Maybe you too can benefit from a reverse mortgage. Call one reverse mortgage now and find out if you qualify. Theyll send you an information guide that includes all the details and the stories of mike and others. A reverse mortgage. Is a mortgage with no required monthly payments. It was created for homeowners 62 or older so they can continue to afford and own the home they love. Many one reverse mortgage clients find they can retire sooner, do more the things they love, or simply put more money in the bank. A reverse mortgage could change your retirement, and your life. I examined my finances and i said, there is no reason why i shouldnt retire today. 10, 12 years earlier than i had anticipated. In the first year, his cash flow savings totaled 8,736. After 5 years, it will be over 40,000. It really is worth a call to find out if a reverse mortgage can help you too. Call one reverse mortgage now and ask for your free guide. Breaking news on midwest manufacturing. Rick santelli has that. The november read, 48. 7. Many thought it would be over 50, by a long shot. Last look, 56. 2, unrevised. Get this, this exactly equals the read that we had for september at 48. 7. Thats odd. If we want to find a lower number, we go back to may, 46. 2. This is a miss. Whether it falls into the main reason most traders Pay Attention to this number, well have to wait and see. Suffice to say, equities have turned a bit negative, yields moving lower and we have more data coming up on housing. Carl, back to you. Thank you very much. Shares of under armour sinking in trade. Piper jaffey lowering the target from 97 to 88. During the thanksgiving weekend, the ua brand remained promotional, that was a quote. This is probably the most weatheroriented of all of the apparel companies. We heard that vf corp there were discounts. North face. Under armour is unique. You need cold weather. A lot of what theyve done is technological. Weather is cold, we have the right product. They have this connective fitness initiative, so theyre not going away. Theres people who think the numbers have to come down or kevin plank will preannounce. If it gets cold, youll wonder why you didnt pick them up in the 80s. Microsoft has been up, the transition to cloud has been impressive. It is interesting when you see the nfl guys given surfaces. You watch them, theyre on the surface. Microsoft has a very good deal with the nfl. I keep hearing good things about microsoft and their earnings power. And how big cloud is. And how legitimate they are. Marc benioff, the king of the clouds, came on mad money and said these guys are doing an amazing job on the cloud. Thats not something he typically says about companies. Hp Enterprise Last week told us they would give us more details on an alliance theyll have in terms of cloud and microsoft. They provide the infrastructure. Hp no longer has a public cloud offering. Were you surprised that the initial are action was so bad . For hp inc. That was bad. Yeah. That was incredible. That was last wednesday after the Company Reported earnings below what was anticipated. Took my breath away. It was so bad. Intel not doing badly. Ink and printing, where you have the japanese yen the dollar conversation we had earlier. The weak yen is making their products competitive on a price level. Really bringing things down. Hp inc. Has to decide where they want to compete and where it doesnt. Do you think its right i was looking at an Aluminum Company worried about closing a big factory in south carolina. Strong dollar in china. Whats the alternative . Not to have free trade . No i want the cheapest product for the consumer. I think that the japanese have debased the currency to the point where we cant compete. Right. As we said, all these Companies Reporting Constant Currency to show what the strong dollar is doing to them. When they had the wind at their back for a decade or more, nobody did that. You would think the countries could be more creative other than say we will take share from the United States. Isnt there another play book . Were doing badly. Were doing terribly. Crush ford. Things arent going well. Shut down the meamerican alumin and steel industry. I dont think its that. They are trying to think of what they can do to improve their country. They spend money on infrastructure. We dont spend money on infrastructure. They do things for the environment. They do a lot. Wind, solar. The play book from every country is the same. Well take that American Market share. Im tired of it. Im not running for president. No. Central bank playbook i guess. Yeah. By the way, the candidate trump has talked about it, i think its a legitimate issue to talk about aluminum industry is going away, steel industry. Look at u. S. Steel. The only thing proud about the steelers is whats on their helmets. The stock needs a concussion pro protocol. Yes. The value of the steelers is more than the value of u. S. Steel. Think about that. Stop trading with jim in a moment. Dont go away. Around here starts at 6 30 a. M. On the nose. But for me, it starts with the opening bell. And the rush i get, lasts way more than an hour. announcer at scottrade, we share your passion for trading. Thats why weve built powerful technology to alert you to your next opportunity. Because at scottrade, our passion is to power yours. Bob dylan. To improve my language skills, ive read all of your lyrics. Youve read all of my lyrics . I can read 800 million pages per second. Thats fast. My Analysis Shows your major themes are that time passes. And love fades. That sounds about right. I have never known love. Maybe we should write a song together. I can sing. You can sing . Do be bop. Be bop do. Do be do be do. Do do do be do. Time for cramer and stop trading. Ambarella will start separating itself. Its been linked with gopro. They have intellectual property behind drones. It would be interesting to see these two die verge. Ambarella could surge here. Could surge. The other one, we talk about under armour. Deckers, uniquely, again, lev levered to needing cold weather. Piper cuts numbers, saying promotional christmas. You look at the degree days, the temperature, and you decide. And those charts would look different if it was cold. Thats a lot of retail. Thats a shame, but thats what happens in retail. So many things can go wrong. Isnt there a they have onstaff meteorologists, climatologists who can tell you we expect this to be the warmest winter in four years, right . Yeah. How do you plan for it . In the end youre kind of stuck with who you are. Columbia sportswear is stuck with who it is. They didnt bet on what some people would say i dont want to get in trouble but global warming. It has gotten warmer. Statistically its gotten warmer. Some parts. And theres a window where you needed frost. It does get cold in winter. But it seems to be later. This year. Lets all agree psychologically they needed Colder Weather in november. They needed Colder Weather. These are fabulous companies. Columbia, a great company. Under armour is a great company. People need to be reminded its going to be cold to buy warm weather gear . Statistically, yes, yes. I worked with my father for 30 years schlepping around to various retailers, when it was warm, my father said well have a bare christmas. Not about being well liked it was about being cold. Attention must be paid. Whats on mad tonight . This has been a hot stock thats cooled today, along with Lockheed Martin. Allergan. Brent saunders is on. You got Brent Saunders on tonight . Hey, the competitive spirit drives me, not unlike c. J. Anderson who sat on my bench tonight and watched him win. Brent saunders, im playing Brent Saunders im tuning in. Still sad he and ian reed werent here. I cant beat you. I knew you would get him. Im a competitive person. Jim, well see you tonight. Mad money, 6 00 p. M. When we come back, breaking news on impending homes, and cybermondays winners and losers. Good monday morning. Welcome back to squawk on the street, im Carl Quintanilla with sara eisen, simon hobbs, david faber. We close out november today. Trying to get backtoback positive months on the dow for the First Time Since the spring, not getting off to a good start as the chicago pmi number comes in lower than anticipated. Impending homes at the moment. Lets get to diana olick with that. Impending homes basically flat. Up 0. 2 compared to september. The street was looking for a 2. 5 gain. Thats a miss. Still up 3. 9 from october of 2014. This index measures signed contracts, not closings. So a forward looking indicator for closings in november and december. These were home owners who were out shopping in october. You may recall we got a disappointing drop in closed sales in october. After a relatively strong spring, fall sales not hot. The number of listings in october was down 4. 5 from a year ago. Usually we see more listings come on in the fall. Its not happening. Higher prices are the culprit. Would think sellers want to take advantage, but they cant afford to buy that step up house or cant find one they like. Regionally, impending sales homes rose 1. 7 in the west, sales fell 1 in the midwest, and 1. 7 in the south. All areas except the south seaing hiseeing higher numbers than last year. Two speeches from janet yellen and november payrolls on friday, and an easing from the ecb on thursday and opec on friday. Its interesting, even as the february members have said they may raise rates for the first time on the 16th, the s p 500 has edged higher through november after that gangbuster 8 comeback from the year before. Gabrielle santos and thomas costok join us. Welcome, both of you. Overnight Fund Managers have said they are increasing their exposure to u. S. Equities to 40 . Is that right do . We focussed on u. S. Equities as one of the major Asset Classes around the world. We continue to see opportunities in u. S. Equities. Especially as we expect earnings to pick up in the Fourth Quarter and next year and hopefully edging closer to removing that fed uncertainty in a few weeks. Lets pick that up with thomas, hes the exist. The fed has done much clearly to change expectations. The market now believes they will hike with some caveats on the 16th what do you need to hear from janet yellen this week . Two things really. The first is shes going to hint at a december rate hike is likely. The second thing is really shes going to emphasize that the rate hiking cycle will be gradual, so she may hint that she could skip the january meeting and the following rate hike could be in march. I notice youve been downgrading your own expectati n expectations. Thats because you think there are head winds for the economy next year, correct . Yes. We think the cyclical tailwinds will fade next year. On top of that, you have tightening financial conditions. Its not only the fed, you have also if you look at the dollar, the dollar has been rising strongly. Its at 19 over the past 18 months. You have an increase in bonds spread. Corporate financing is getting more expensive. Theres a tightening in the economy. On top of that, the cyclical tailwinds are fading. For instance, car sales will plateau next year. So less boost of a growth next year. Let me pick up the point then on the economy and the tailwinds and the fact that the fed will be flattish on what it does. Jpmorgan has a report out talking about next year, car sales peaking, profits peaking, and corporate Balance Sheets weakening because of the huge buybacks that were experiencing from cos. The rally might run out of steam the second half of next year. Where would you be on that . We would say for next year it has to be about earnings materializing again. This Earnings Growth has to come from the top line, from revenue growth. Here we disagree a bit on the cyclical expectation for next year. We expect to continue at a pace of 2 growth. We tend to think the consumer can provide that boost. So you will still have support from revenue growth. As a result you can get decent Earnings Growth for 2016. It does seem that that is one of the two big uncertainties that weighed on markets this year, the lack of earnings and sales growth and china. Has anything been clarified in your view as to the china growth story or will that weigh on us next year . That was for thomas. So, in the nearterm, the big decision is the decision on looking at what happens with the currency, we think the currency will slide slightly. We think growth is stabilized. The authorities will help with growth in china we see china stabilizing. We dont think the major risk is from there. Usually thats something to watch next year. Do you agree . We agree. I think we have seen some decent signs that china is stabilizing. That some of the target stimulus measures that china has been implementing has succeeded in stabilizing the economy. Thats what we expect for next year. Not a bounce back in china, just stable. Thats enough for markets. In the meantime, what part of the market do you think will work best next year . Well continue to focus on cyclicals. Thats been a big story for this year. We think think theres more steam for next year, especially with the increase in income expectations. That seems supportive for more spending next year, as well as thinking about financials in the context of a rate hike. Were out of time. Thank you for kicking off the week with us. It is a very big week. Gellen, dr yellen, draghi and the jobs number. Steve is here with more. We have decisions, we have data, we have speeches. Look at the decisions. Today the imf executive board to take up the issue of including the yuan in the sdr basket. Not a huge deal, but a vote of confidence in the yuan. Ecb on thursday, on Interest Rates, the big story there is some form of easing is expected. Perhaps in the form of a more negative rate. A two tier deposit rate has been talked about on friday, the opec meeting. We will see if the pressure on saudi arabia mounts to limit their total outpeut. For tuesday, market moving news in her last last speech f. On thursday, yellen has testimony, and that comes before the friday jobs report. On friday, we are mario draghi right here in new york at the Economic Club of new york. Now to the allimportant data. Ism manufacturing coming tomorrow. The importance is its on the lineup of contraction and expansion hurt by the dollar and weak overseas growth numbers. All of that despite strong auto sales, wednesday, adp, the first gauge of the overall jobs market followed by the feds baeige book. Friday, jobs, 205,000 is expected for, compared to 271,000 in october. Unemployment rate seen unchanged. Average hourly wage, after a decent october going more back to trend at 0. 2 . Everybody has to Pay Attention to this with the jobs being the number one factor probably when it comes to what the fed does later this month. It will be exciting. We live for this stuff. Thank you very much, steve steve. Up next, cybermonday is in full swing today. All the ecommerce players are hoping for big Sales Numbers who will come out the winner . Well name some names when squawk on the street comes right back. Nly thing you think about. Thats where at t can help. At t has the tools and the network you need, to make working as one easier than ever. Virtually anywhere. Leaving you free to focus on what matters most. Yup, were constantly making thinkorswim better. Here at td ameritrade, theyre always working. Like a custom screener on your desktop, that updates to all your devices. And you can share it with one click. Wow. How do you find the time to do all this . Easy. We combined every birthday and holiday into one celebration. different holidays being shouted back to work, guys i love this times of year. For all the confidence you need. Td ameritrade. You got this. Is our partnership with habitat for humanity. Pg e is committed to clean energy and part of that commitment our mission is to build homes, community and hope. Our homeowners are lowincome families, so the ability for them to have Lower Energy Cost is wonderful. We have been able to provide about 600 families with solar on their homes. Thats over nine and a half Million Dollars of investment by pg e, and that allows us to provide clean energy for everyone here. Its been a great partnership. Together, were building a better california. The big shipping season started this weekend. As big Ecommerce Companies moved up sale the, the question is did the season peak early . Morgan brennan has more live from the bronx. Good morning. Reporter good morning, sarah. For parcel carriers like fed ed and u. P. S. , the peak season kicks off with thanksgiving. With amazon, target and other retailers rolling outdoor buster dea deals days ahead of that, more shoppers began shopping earlier. Shopper track says black friday sales may have decreased because of these early promotions. That means more packages being delivered prior to peak season. Thats what were seeing. Ship matrix says from november 9th to november 16th, ecommerce volumes jumped 18. 5 compared to the same period in 2014. And while they wont have the data for thanksgiving week until likely wednesday, they anticipate an uptick in those numbers as well. Ship matrix and many other shipping experts expect a much more drawn out peak season compared to the massive lastminute spikes that we have seen in years past. Even so, thats not to say we wont see another late jump in shipping volumes. Fedex expects today and the following two mondays to be the top three of the season. Riv rival u. P. S. Expects two days before the holiday to be the peak day, and december 21st. Slowing store traffic as shoppers went online. Colin sebastian joining us from San Francisco. Good morning. Good to see you, colin. You see ecommerce is tracking slightly above plan. Can you be more specific . Yeah, sure. From all the data points weve received from the weekend, were looking at e commerce growth in the mid to high teens on average. That versus expectations for low teens growth year over year. We are seeing resiliency in the face of bricks and mortar weakness across the board for both omni channel retailers and pure plays like amazon. The hot phrase in apparel is promotional, right . We know that the discounts online are just as good. Its just as promotional. Why does that weakness not translate to ecommerce . Well, whats driving ecommerce growth is in part discounting. You can get essentially the same deals online that you can get in stores, but also that secular growth of online shopping. People shifting their Holiday Shopping spent online from off line. Thats a nice tailwind. Secondly a lot of categories such as furniture and apparel. You mentioned nontraditional ecommer ecommerce. And we have mobile, aggregators like amazon taking a larger piece of the pie. In all of these articles, it says amazon is the big winner. Its the ecommerce king. Can it be that simple . We know target and walmart are going half after those online shoppers, free shipping, early deals. Who else wins besides amazon . Are some omni channel or multi channel retailers that can see solid growth. With this mobile shift in terms of shopping, its really inconvenient for consumers to have different apps on their phones and tablets. We think this favors amazon and google. You can go to one or two apps, find the products youre looking for, thats more convenient than traditional shopping on desktop sites or in stores. Colin, what do you think is likely to surprise that investors can take advantage of . Were seeing in some cases accelerating growth online versus last year. We will see if that continues into the end of the holiday season. That certainly would bode well for all ecommerce next year. And certainly for vertical sites, such as wayfair that operate in one certain category, shutter fly in another category. We think the aggregators are the true beneficiaries. You mentioned shutter fly. You found some technical difficulties there along with some other names, i imagine. Whats the punishment for a site thats down on one of the most important days of the year . Yeah. So shutter fly did have technical issues yesterday with heavy traffic to the site and to the app. Its a matter of Customer Service at that point in terms of how they react and serve those consumers who are impacted. From what we can tell, they have been proactive. The site is back up and running and they are reaching out to those customers to make sure orders get through. So lets talk some stocks then. You want your preferences for amazon, google and others . Looking into next year, facebook we look. It hasnt performed as well as google and amazon. On a regti and google we like as an aggregator of ecommerce searches, and with disclosures coming in q1. Then amazon. Longterm we still see it as a significant winner, both in retail and cloud computing. As we continue to shift all our spending online and on mobile, what is going on in the payment business . Is that taking share in terms of the business of shopping this year . Online payments that is. Yes, it is. Both traditional online as well as mobile payments are both increasingly important. Merchants are getting closer to the customers. Theres a lot of data you can extract from online payments. Pay p paypal is the leader. Theres competition from google and apple increasing. This is a trend that will not abate any time soon and maries the instore and online experience. Again, for investors colin, i want to come back on amazon. It is right and proper thats the front and Center Conversation for retail and particularly on a day like today. Given where the stock has tracked. We showed it for the last two months, up over 30 . Its more than doubled for the year what further value is there in that . Given that the profit margins, particularly in retail can be so discretionary that we never know where we are the bulk of the money is being made on web hosting. How does an investor square that . Do you buy the stock here . We continue to bite stock here. If you think about amazon and retail, theres still onyre st of walmart. So theyre not in a position to harvest earnings, its about topline growth. With consistent greater than 20 growth over the coming years, that justifies the valuation. The stock has done well year to date. There may be profit taking towards the end of the year. We would take advantage of that. Well track this for the next 25 days or so thank you very much. Colin sebastian. Thank you. Coming up, trump making headlines once again today. This as Chris Christie wins a key endorsement ahead of the New Hampshire primary. More on that when we come back. We just had a discussion about retail websites holding up or not holding up on the traffic. This is targets website. Please hold tight, so sorry, but high traffic causing delays. If you wouldnt mind holding, well refresh automatically and get going. Maybe we should keep watching and see if they come back online. Walmart. Com, it didnt go down, but it was taking longer. Online sales are surging 20 to 40 . Its sort of a good thing, but you wonder what punishment is once the site goes down. Donald trump making headlines about his september 11th claims. Our chief washington correspondent, john harwood hat details. Good morning. Good morning. Were past thanksgiving, last day of november, despite all predictions to the contrary, including my own, donald trump remains at the center of the republican president ial race action. He spent the weekend denying that he mocked the disability of a new york sometimes reporter, even though few believed him on that. He also insisted that he was not going to retract his claims that have also been debunked by most observers that large numbers of muslims were celebrating as the towers went down in new jersey on 9 11. The Washington Post also wrote about tailgate parties. Were looking for other articles, were looking for other clips. I wouldnt be surprised if we found them, chuck. For some reason theyre not that easy to come by. I saw it. So many people saw it, chuck. Why would i take it back . Im not going to take it back. Now, that not taking it back policy has worked well for donald trump. It did not get him the endorsement of the Manchester Union leader which over the weekend went to Chris Christie, the governor of new jersey who also said he doesnt remember the celebration of those muslims in new jersey on 9 11. Now, Chris Christie remains a huge long shot in the race, but if he is going to have a moment in the race, this was the boost that he needed to get a little traction. You can tell that some other candidates were concerned about this because this morning he was attacked by one of his rivals. Guess who . Donald trump. He said Chris Christie had been spending too much time in new jersey while trying to be governor of a state thats deeply troubled. Ten weeks to iowa, john. John harwood, thank you very much. Straight ahead, well go live to paris where World Leaders are meeting on Climate Change. And why stop what youre doing to find a bathroom . Cialis for daily use, is the only daily tablet approved to treat erectile dysfunction so you can be Ready Anytime the moment is right. Plus cialis treats the frustrating urinary symptoms of bph, like needing to go frequently, day or night. Tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. Do not take cialis if you take nitrates for chest pain, as it may cause an unsafe drop in blood pressure. Do not drink alcohol in excess. Side effects may include headache, upset stomach, delayed backache or muscle ache. To avoid longterm injury, get medical help right away for an erection lasting more than four hours. If you have any sudden decrease or loss in hearing or vision, or any symptoms of an allergic reaction, stop taking cialis and get medical help right away. Ask your doctor about cialis for daily use. Insurance coverage has expanded nationally and you may now be covered. Contact your health plan for the latest information. Good morning, im sue herera. The white house says while in paris for Global Climate talks, president obama met with russias vladimir putin. The two discussed the ongoing civil war in syria and last weeks shooting down of a russian fighter jet by turkey. Classes are canceled today at the university of chicago after the fbi informed the school of a gun violence threat. 30,000 students and faculty were told to say home after a threat was posted online that mentioned the schools hyde park campus quad. Pope francis on his way back to roam after fiveday visit to the african continent. The pope met with muslims and called for an end to religious violence. A major retirement announcement from a fixture in the nba. Kobe bryant of the l. A. Lakers announcing this season will be his last. Bryant was drafted right out of high school by the lakers at the age of 17. That is the cnbc news update. Sarah, back to you. Big moneymaker for nike. Say the least. Sue herera, thank you. The u. N. Climate change conference underway in paris. Leaders from nearly 150 countries are in attendance including president obama who did meet with vladimir putin, the russian president on the sidelines of the talks. Steve sedgwick is live in paris with the latest. Steve . Sarah, thank you very much. How interesting that president obama was meeting with president putin, yet president putin could not find time to meet with mr. Erdogan, the turkish president. Erdogan and putin have been at each other over a war of words since turkey shot down that russian bomber. That is typical of whats going on on the sidelines. Lots of other things going here at the talks where 150 leaders have gathered. Gathered in the shadow of that recent terrorist attack in paris. The security around what is a secure zone, its a Historic Site but also a u. N. Security zone. Back to the Climate Change talks. President met with the Prime Minister of india. Thats significant, a lot of flayers are on time this board around, including the chinese for a successful deal. President obama and president cji talked about this the indians are not necessarily online. They say you had 200 years to industrialize, use coal, hyd hydrocarbons and now we cant use this . The indians still have 300 Million People off the grid without electricity, they see coal fueling 40 to 60 of their electricity. From indias point of view, they think the developed world has to show them the money and theyre asking for an increase in the dollars available to countries like india to wean them off hydrocarbons and coal. Thats a sticking point. One thing thats different this time around than 2009, its a bottomup approach rather than topdown. Everyone is coming forward with their intended nationally determined contribution, the u. S. Said it will cut its Carbon Emissions by 26 to 28 over the next ten years. It remains to be seen whether we will get a successful conference, but certainly an air of pragmatism around. Back to you. Well see if they can come to any political agreement. Thank you very much. Currency is taking center stage this week. The International Monetary fund is expected to announce that the yuan will join its International Pa basket of currencies. Mark chandler is the global head of currency strategy at Brown Brothers harryman. He will help us break it down. First on the imf decision, doesnt mean a whole lot in terms of the practical sense of thing, but what is the real significance . The real significance is not necessarily about the shortterm trade but the recognition that china has comb so far in the last 20 years, the recognition that china is one of the major financial powers. Its a status thing for china. Practically the Federal Reserve will be raising Interest Rates in a few weeks, probably. Every other major bank is likely to be easing policy. This will keep the dollar well supported, including against the chinese currency. For those who say china will unseat the dollar as king. You wrote a book about this, its not true. Not true. Will today be a milestone in chinas effort to doing that. Its another step towards china fighting its rightful place on the center stage. This is important. 18 out of the last 20 centuries, china was the worlds biggest economy, technology leader. So were talking about a return to normalcy. You mentioned the dollar getting stronger. It does feel like a oneway bet what reverses it . Is this buy the rumor or sell the fact on the fed meeting . The thing that will happen this week. Thursday, the big event, ecb likely to ease policy. We cant take profits on short euro positions. On thursday no matter what the ecb does, because of the jobs number on friday, which will be well off the 270,000 we saw last month. That was the highest for the year. So some modest pullback suspected. People are more likely to take profits after the jobs data. Longerterm investors are better served with a strong dollar next year and well into 2017. Expectations are huge for the ecb, not least within europe that it can support this huge rally in the bond market it could disappoint on thursday, couldnt it . Could disappoint but for the last couple of years, since draghi has taken over at the helm of the ecb, he has surprised us at being dovish. Back in china you frame it like everybody would frame t but you could say longer term who needs legitimacy from whom. The chinese are assessing their own institutions away from the imf and the United States. They have their own agenda here. People would argue the imf bent the rules here to get on board. It badly needs to be seen to be doing the right thing for beijing, for its own political survivor. This is the second best scenario the first best is if the u. S. Congress would have made the money to the imf to allow a reform of the imf so china can get more than belgiums vote. The u. S. Has like 40 of the votes. The key then is we in the west and highincome countries, we want china to not just set up its own institutions, like the aaib, but want them to join the multilateral institutions we already have. Dont you think the chinese arent stupid. Wont they see through that . They dont have the votes, but longer term, is the west on board with chinas big ambitions . I dont know about the big ambitions, but this is the real issue. China, i think, wants the recognition when i talk to chinese officials, im struck by the sense that they think the u. S. And europe have done them a disservice, havent given them the respect they think they deserve. Getting the recognition is what they want. But i agree with you. They have bigger issues. And bigger agendas. But the short piece is they want respect and acknowledgment of how far they have traveled. Youre looking for sustained Dollar Strength in 16 or 17 . Does dollar index go higher next year. I think so where we are in the big picture this is the third significant dollar rally weve had since brentwoods. The reagan dollar rally lifted the dollar more than 50 . Then we had a tenyear bear market, the clinton dollar rally. That lasted about five years. Also stopped by intervention. We have the obama dollar rally now, its driven by this divergence of Monetary Policy among the central banks, we have a long way to go. Not just months, quarters. As go into a political quarter, do you take that seriously . Not really. The price of gold, in order to get back to the gold standard, the price of gold has to be ten times higher than it is today. If anything, gold has been falling. We just had a fiveyear low in gold. People are not flocking to gold because of turkey shooting down the russian plane, because of isis or the terror attacks. You dont see a movement to peg it to something else. The principle is this, even if the u. S. Wanted to its probably not Strong Enough to enforce its will in other countries. Other countries dont have the strength to force it on the u. S. Im not sure i buy into the g0 world, but that image is important to knows there probably not a new brentwoods. Theres also more confidence in the u. S. Dollar now than in several years. That argument falls apart. I wanted to get back to your point about the reagan dollar rally, the clinton dollar rally this is not 90s. Can the u. S. Economy weather this strong of a u. S. Dollar . Certainly corporate profits are suffering. I dont know why theyre suffering because of a u. S. Dollar or because of weaker overseas demand. The u. S. Only exports about 15 of what we produce. That means 85 is consumed at home. The 15 we export is important but not the key. I think the best thing for u. S. Exports is stronger world growth. Not necessarily a weaker dollar. How quickly does the euro fall to parody . Briefly, but next year, slower process. A lot of people shorted the euro, Short Covering ahead of the end of the year. One of the biggest weeks in foreign exchange. Thank you. Coming up, the uber for helicopters is expanding into private jets, its not just for new yorkers anymore. The co of blade will join squawk alley. And were watching how retailers handle the deluge of traffic. Targets message is please hold tight. Recommend synthetic over cedar . Super food . Is that a real thing . Its a great school, but is it the right one for her . Is this really any better than the one you got last year . If we consolidate suppliers, whats the savings there . So should we go with the 467 horsepower . Or is a 423 enough . Good question. You ask a lot of good questions. I think we should move you into our new fund. Sure. Ok. But are you asking enough about how your wealth is managed . Wealth management at charles schwab. [bassist] two late nights in blew an amp. But good nights. Sure,musics why we do this,but its still our business. We spend days booking gigs, then weve gotta put in the miles to get there. But its not without its perks. Like seeing our album sales go through the roof enough to finally start paying megs little brother i mean,our new tour managerwith real,actual money. We run on quickbooks. Thats how we own it. Welcome back to squawk on the street on this monday morning. Healthcare is standing out as the worst performing sector in the s p 500. Despite the early losses today, its in the green for the year so far. Following Consumer Discretionary and technology, the third best performer. Among the laggards, universal health, biotech names like vertex, abvie and regeneron. Heading into november, biotechnology has been an outperformer. Well see how that fairs into the afternoon trade. Lets send it over to chicago and Rick Santelli, a flattish start for a big week for the markets. Over to you. Thank you, simon. 48. 7 was the read on headline for november pmi, chicago pmi. Which equaled septembers. Complete giveback. And if you look, the 11th read in november, 6 below 55, above 50, and were like to have to you explain it all. Less start with headlines, alice. Complete giveback from last monthss pop. Low the levels since september this wasnt a big surprise. We had to have some pullback. New orders and production, big jumps here. A lot of big jumps in new orders and production levels. The one thing you want to look at, you always want to have new orders above production. You want new orders leading production. But were the other way around. Production on top of new orders. What is that telling me . With production new orders not leading production what can i infer from that . Companies are doing other thing. Working on r d. So theyre idling the car because theyre not in the race. Absolutely. Backlog has been a big one what have we learned from a positive number but still in the red in terms of 50 . This is the tenth month in a row that weve been in contraction. Youre seeing the big jumps because thats where the orders are coming in. Theyre not placing orders in advance. Theres nothing in the pipeline. This is the big one. If you want to understand chicago pmi and the entire economy, its all about inventories. Last month we were above 60. We expected this to whittle down. So we lost two handles on that. Thats what purchasers are, whittling down inventory. Im hearing from them theyre not expecting big new orders in november, so these levels will probably stay flat or go lower because we wont do building right now. The other thing is we did a special question asking what are your inventory levels . Do you think theyre too high, too low, or about right . 44 said theyre too high which is a high number. About 54 said theyre just right. So, to me, that tells you that were not going to see a big bounce. If i wanted to make simple inferences, everything these folks do to prepare for the things well buy and all the issues for the holidays, its already in the hopper and spit out. So this really is giving us a glimpse that before we know christmas data, and how demand was, this is giving us an Early Warning that not to expect much. Would that be a good conclusion . Excellent conclusion, rick. Theyre telling me these production levels are very, very disappointing. Theyre not getting indicators from customers that there will be a big influx of orders or need to build inventories. This is a good scenario going into december. Im not expecting much movement. Thank you very much, alice. We hope that somehow this is not correct, we will see how the National Number looks. If this is an Early Warning sign dont expect a lot of christmas cheer by the retailers. Alice franz, thank you. Thank you very much. Up next, the online retailer thats going oldschool this Holiday Shopping season with a catalog. The ceo just want to keep you posted on a story we brought you. We told you target was experiencing some website issues. The site was down for at least 20 minutes or so. As you can see on my mobile phone, its just starting to come back online. We are getting reports its tricky to put things in the cart. Obviously, this is one of the most important days. It is cyber monday. Target we know has been making a big push to compete with the likes of amazon. Com and walmart. Com when it companies to online sales. Lets send it over now to don with a quick market flash. Lets stay on that retail theme because shares of business supply stores saples also office depot are moving to the downside today. Published reports say the federal trade commission, the ftc, is maybe leaning towards blocking the proposed purchase of office depot by staples. Again, those shares certainly a focus today. Remember, that deal has within at least in the works for quite some time. Staples and office depot, stocks were focused on today. On this cyber monday, banking on old School Strategies to attract customers. Were talking about the print catalog. Joining us is the ceo and cofounder of the ecommerce retailer leadberry. Youre the hot new startup appealing to millennials online. Why go old school with the catalog . Like a lot of people, were facing the same challenges. Its about discovery, how to get in front of new customers, retention. And how do you build your brand. I think we started online like a lot of brands about six years ago when there wasnt as much competition online. To get to that 10 million, 20 million mark. Able to scale, you know, through pr, word of mouth and digitally. But now weve got to go out and find good new customers. I think people forget that we send out, at least as a nation, nearly 12 billion catalog mailings a year. I know, i guess im just wondering how many of those we throw out. Ive been throwing out a lot of bloomingdales catalogs over the past few weeks. People do throw a lot out but i think its a matter of being able to target the right folks. In terms of digital ads, you might see for 2 seconds. A catalog, somebody might spend up to 2 minutes with it. Its somebody who buys luxury shirts, going into their home and seeing if theyll come back and buy. I think what were finding is theyre buying better than the ecommerce customer. 1. 5 times what they buy compared to any commerce customer we acquire online. I was really making the comparison with, say, the old sears catalog, with perhaps people being able to buy their purchase other a period of time and that sort of thing. This is direct marketing, isnt it . This is a smaller catalog, as you keep saying, in competition with, say, sending an email program to people. Thats the deal here. Certainly. If you think 50 of the emails we get are promotional emails. We have people can buy shirts again and again. Our top 100 customers have over 74 shirts apiece but 24 of those people have unsubscribed to emails. So how do we find them . We bring them back with the catalog. On the day we got the Climate Change meeting in paris, im slightly nervous to ask you. Isnt this a huge waste to be sending these to everybodys letter boxes when only a small percentage is actually going to reply . Its certainly you try to do it on recycled paper, you do what you can to make it much more environmentally friendly. You also talk about different things. For example, we talk about the Chesapeake Bay if were from virginia. That might not have anything to do with our shirt bus its a lot about the people and places we put forward as a brand. We talk a lot about conservation in our last catalog. Its more stole telling, more engagement. Youre really leaving the commerce to the online piece of the puzzle. Restoration hardware famously puts out its big book of thousands of pages which they say works really well. Jcpenney has gotten back into it. Then you have losers like sky mall who filed for bankruptcy recently. Who are you trying to emulate . I think it comes back to brand and storytelling. I think i feel like everybodys bombarded with internet ads. If we can get two minutes alone with our customer in the house when they flip through the magazine and learn about the products, the value we believe in as a brand, theyre going to come online, be invested and purchase and hopefully be a customer for life. Were telling stories. Were engaging with our customer. Thats a world of difference from 50 years ago. Harvard Business School did say its about brand building potential. Hows your business in general . We hear that apparel. We know from the numbers apparel has not been strong in the face of electronics and spending on, say, sport ware. What about you, what are you finding in terms of sales this year . I think were doing well. I think were doing mens luxury shirts. This is a great product. Some people dont buy a suit but theyll come back and buy new shirts. I think its been a tough november for most folks. Things like the weather, which has been the hottest weather on record. Hard to sell a shirt in 70 degree weather on the coast. I think what were beginning to see, a great response. A lot of folks have been waiting. Now theyve got the money and theyre ready to spend so were optimistic about it. I see 30 off online. Thank you, paul, the ceo of led delawa ledberry. Weve got amazon coming up, weve got a new drone, but not the kind you can buy, or legally fly here in the u. S. Well dig into whats going on there. Also cyber monday the biggest day online. And the sports retailer fanatics, this is probably going to be their biggest day ever if last years any indication. When you do business everywhere, the challenges of keeping everyone working together can quickly become the only thing you think about. Thats where at t can help. At t has the tools and the network you need, to make working as one easier than ever. Virtually anywhere. Leaving you free to focus on what matters most. Good morning. It is 8 00 a. M. At Amazon Headquarters in seattle. It is 11 00 a. M. On wall street. And squawk alley is live. I broke down the chairs i broke down the tables im trying to find they call me the seeker welcome to