washington. senator jeff sessions heads to judiciary. futures are steady. the ten-year, around 2.39%. small business optimism at an all-time high. we begin with the sprint of confirmation hearings. in minutes, what investors should focusing on. apple is breaking to an all-time high, but is it a sign of a stronger year ahead? carl icon on the quote of idiocy of over regulation. how he is pushing the trump administration. chipotle warns it is putting out preliminary results. it is making a reversal, now in positive territory in the pre-market. >> of course. first up, stocks are looking to bounce back from a mostly negative session on monday. nasdaq was a bright spot, hitting fresh, all-time highs. apple one of the catalysts, rising to a new 52-week high. nasdaq is up five straight. interestingly, it started december, up six straight, jim. >> right. this is kind of a reverse. apple being the last to really go. look, there's a stock, i call it repulsive today, realmoney.com article, about a repulsive stock. up 220% and had the spike of 118% and went down. cse, which typically doesn't move things, talked about a lot of different devices that require a lot of chips. semi-conduct semi-conductors. texas instruments, good update yesterday. i see that group as still a laggard. there's a piece today that is way too long. it is rigorous. >> oh, my. >> i know. i'm on page 20. this is "war and peace." >> a lot of paper. >> it talks about the tipping point. and the tipping point is about facebook and alphabet. that, again, tells me these fang stocks and the broader tech have momentum. apple is a battleground though. this is the siuper cycle. then the back channel says, don't believe the super cycle. don't believe this could be roaring. the issue with that is that, you know, if you think the trump agenda is going to happen, some sort of taxation, apple can do a lot. yesterday was all about how apple hasn't kept up with siri -- or siri hasn't kept up with all these other devices. there is a story everyday about how apple hasn't kept up with this or that. if you take my apple away, i'll kill ya. >> it is a battleground here. elsewhere in fang, today, facebook -- facebook has a few things going on. >> yeah. >> ads going -- not pre-roll ads but the middle of video. court case in dallas, $2 billion claim, alleging that oculus is built on stolen technology. >> facebook, i was looking at facebook yesterday. sells at -- i don't want to talk about the low multiple that some people are using in 2018. talk about he bow mabelow marke. it requires a 2018 stretch number that wouldn't include oculus as having a patent challenge. i will say this, when you come out of cse and you have the level of excitement about virtual reality, artificial intelligence, and you think, who is playing in there? you always have facebook. facebook is playing in a lot of places. amazon is playing in a lot of places. al alphabet, david, alphabet is getting serious about shedding divisions that crushed their numbers. >> whether it is robotics or now satellites. >> satellites. >> making some decisions there to slim things down. the influence, one could argue, of the cfo, who has been there now a while. >> david, it is no longer an animal house. >> drunk, fat and stupid is no way to go through life. remember that. >> they're not on the sofa anymore. >> knowledge is good. >> knowledge is power. >> yes. >> anyway, i think the stocks are not expensive, with the exception of amazon, which is incredibly expensivexpensive. at the same time, when we see a report today, numbers that are horrendous, one retailer after another, we have to keep coming back to the notion that amazon is why the limited disappeared over the weekend. the relevance of the limited being questionable. the relevance of amazon being extraordinary. >> so you've got tech, nasdaq, fang, all doing well. at the same time, another sell rating on another down name, citi calling goldman to sell. >> that was a compelling argument. it basically said -- it's done so much. how much more can you do? this is the same kind of thesis. goldman had such a run versus the other financials and assumes a massive deregulation, including one of the things i found when i was working at goldman which is important. can the partners use their own money to be able to position stock? one of the things they've been afraid of is if they position for a customer, people might think they run a foul. that's fine. but at a certain point, goldman deserves to sell at book value, not a discount. this has been a run. i don't know if goldman -- whenever goldman prints next week is good enough, i just don't know. >> right. but it is all in the come, isn't it? it is about dereg and rising rates. >> we talk about it all the time. >> it is not a bad thing the names have stalled a bit, or as some of the guys that come on the air, consolidated. they're consolidating their gains. >> the stocks really haven't moved that much in december. it's been since mid-december. this is really a nasdaq rally. that does help. but i see the potential -- i'm going to distinguish goldman from the rest. spent a lot of time between 15 and 17 and goes to 22. wells fargo, bank of america, these are tremendous rate hike stories. >> right. >> yes, we have seen -- when we've seen a rate hike cycle -- remember when allan green span allowed the short rates to refinance during the 1991, you get a longer term move. goldman is ahead of the others. >> just to read from the note, uncertainty that the key drivers of the blue sky scenario, such as corporate tax cuts, deregulation and infrastructure spend, either do not play out or take longer to achieve. that's exactly what you've been -- >> that's what i'm worried about. tomorrow, rex till erson comes. every day, there is something you don't hear about. that you didn't want in terms of being bullish. look, jack ma appearing in the trump tower, talking about trade. >> talking about jobs and trade. he said, i have to go. can't let just the large shareholder be there. >> that's part of the thesis. what isn't in the thesis is a multi-day hearing about tillerson getting a medal from putin. it slows the agenda the stock market needs. i'm not making a say about tillerson, yes or no, but you don't want to slow down. >> particularly when it comes to tax reform and the timing of that, how important that is for so many investment decisions. not to mention its transformative power for industries, depending on what we end up with. it is certainly not going to be until the summer that we -- i mean, ways of means, when are they going to introduce the bill? when is the senate going to weigh in? where is the trump administration going to be? how involved with they going to be? >> right. >> there's a lot of questions. >> right. >> even looking at that scenario, especially with pence talking about the aca, repeal and replace, as opposed to any mention of tax reform, though last night, ryan and trump did meet about it, you have to wonder, are we talking about '18 before we see it? especially if you link individual and corporate the way ryan wants to. >> right. so what you have to do is say, okay, can i get out of goldman at 240 with the idea of getting back in at 220? bank of america, 22, can i get in at 20? i think traders can play that game. i think people at home are saying, what are you trying to churn me, churning me in bank of america? things are going to be better next year with the rate hikes, i should stay with it. >> icon was on "fast money" last night and talked about the future of dpe reguleregulation. take a listen. >> i think he is smart and one of the few people that can really shake up the establishment and stop, what i consider to be, almost idiocy with this overregulation. now, there was some very good regulations. in fact, i do believe that you need wall street regulations to some extent. i'm not as much anti-dodd/frank as a lot of people. but i think some of them, we've run amuck. >> talk about a guy who has trump's ear. >> yes. and i think what we're talking about is two things. the tone of how to regulate. remember, you can have regulators choose to not be aggressive. and then this notion of lending. if you kind of let up and not be lending on some sort of weird ratio, but just lending, i think there would be more small businesses that are optimistic and get loans. so idiocy, carl icahn is a man of hyperbole. if you're jamie diamond, there are too many compliance people and there's not enough freedom to lend the way they'd like. in a responsible way. >> speaking of small business, we mentioned nfib at a 12-year high. trump and the gop congress have the momentum but maintaining it will be a challenge as the political process takes on, is what they say. >> i hear that, he has the momentum but don't count on it. if you have the level of optimism, i was going to put it in my game plan friday. maybe there is going to be a change. no, how can it be noticeable? 2004, buy another ford f-150. it means perhaps you want to hire a few more people. maybe you're less confused about obamacare because you're less worried about it. less worried about running a foul of regulators. i have two small businesses and the government is the only thing that puts you out of business. if the government itself is going to be a little less active, then i think what happens, you feel a little more bullish. >> you do love your small businesses. >> i do. but i have to tell you, avocado costs are up big. we'll get to that in a second. when we come back, other news, yahoo! planning on a board shake up. lulu is up. we'll talk about the ceo about the road ahead. take another look at the pre-market. s&p hasn't raided at a 1% range for 16 days. fourth time we've had a streak like that since august. more "squawk on the street" in a minute. g nts ♪ stowing away the time ♪ you gathering up the tears major changes in store at yahoo! once it completes the sale of internet assets to verizon. meyers will no longer be on the board. it'll change the name to altaba, reflecting the stake in alibaba, though widely reri lly derided >> change it to verizon. >> altaba baba. >> it's funny when you see these things. did they think about what we would talk about on "squawk on the street"? >> have a problem with altaba? >> altaba, yeah. >> i had it on my menu the other night. >> we compiled a list of other classics. >> there we go. >> where is allegiant? >> oh, my. >> i actually like agilent as a takeout candidate. >> all right, enough. >> we wanted venator. >> the symbol is acn but the spellcheck makes it can. >> beyond the name, the facts as they stand now for yahoo! of course, is there continues to be some concern that verizon won't go ahead with the purchase of yahoo!'s core business because of the two huge hacks that took place. i'm told right now they're still gathering information on usage. that is on the yahoo! side. and going to present it to ver rye ryeson, saying here is where things stand. can we see decline in usage as a result of the hacks? that'll be evaluated. the likelihood seems to be this deal occurs. will verizon try to get a price cut? why wouldn't they give it a shot? will they be able to? we'll see. you'll have a new proxy being filed in the next couple of weeks, i guess. question as to whether you want to resolve this prior to that or not. so we may hear something more. there's been talk also about being able to indemnify verizon against the fees s accrued as a result of the hack. the stake in alibaba, stake in japan and $10 billion in cash. it is an investment company. that is what it is going to be. think of it as a mutual fund with big cash position, big stake in alibaba and stake in yahoo! japan. >> there is tim armstrong merging the old yahoo! before it was altaba, with -- >> aol and what he has there? >> yeah. that's more than just a holding company, no? >> wait, i'm saying what is left of -- what altaba will be -- >> just the altaba. >> is an investment company with the stake in alibaba, stake in yahoo! japan and 10 billion in cash. most likely ends up at verizon and run by armstrong. >> verizon is a huge company. is that a needle mover like how directv was a needle mover? >> they're following a different strategy there at verizon. they're not taking -- certainly not as big of bets on content and going for the ad strategy. >> right. >> and the technology behind delivering ads and that part of things. it's sort of one of their core competencies, the go 90 network, also. >> i was excited about the netwone emergency. -- merge. i like armstrong. >> this deal will close if they get past the hacking problems. >> i think they get it closed, and i think yahoo! could be revitalized. i think there is a lot of people around the table who say yahoo! was run down. >> she is going to continue to run the company? >> one report suggests she could -- >> stay at verizon. >> within the merged unit. >> that was unexpected. i don't know it to be true, but i did see the same reports. >> live in the cave, one of our most loyal viewers, says altaba is lagging. we should have taken microsoft's $40 billion in '08. >> amen. >> right. that is a true statement. >> should have taken the money. when we come back, we'll get cramer's mad dash, count down to the opening bell. look at the pre-market on this busy tuesday morning. health care, consumer, tech, and of course our eye is on the senate judiciary. back in a minute. s! suri ye÷!ch scoul m s! s yo 9f thclclrun uallyro honudth ♪ all right. time for mad dash on this tuesday with little less than eight minutes until the opening bell. we'll talk about a stock that has ruined many a portfolio, whether value act, which had huge gains embedded there, or p pershing square. we could go on and on. >> this is the first time we've had genuinely positive news of late from valpant. three skin care businesses that aren't important. a business i'd given up for dead, they sell close to the chinese company for $820 million. positive first step, i don't know what you're hearing in terms of whether there is more to it, but $30 billion in debt. anything that cuts it makes it more investable. >> obviously, they failed in the agreeing to terms there. joe talked about the willingness to do that. >> right. >> $30 billion in debt going down to what is the question mark. >> well, you know -- >> what about growth? can you get any growth? >> yes, you -- they put through price increases. i believe scott will ask about the price increases when he appears in the hedge fund reports. that will be dispositive. i think valeant was talking about rolling back some prices. i'd like to hear which drugs are being rolled back in price. that's what i want to know from joe papa, not just the fact that it was sold. loreal is a smart company. why did they pay that enough? i don't know the answer. >> what is going to move the stock? >> joe did tell me they had a very positive pipeline when he was on ""mad moneym "mad money". pipeline, what's in there, you're looking at the somewhat skeptical. >> a bit. i was looking up at hilton, and that grand vacations. i started to think about that pool and nice, warm weather. sorry. the mind wanderings. >> it is okay. it is cold out. it is pipeline and joe is going to talk about the greatness of the pipeline. i am -- >> the greatness of the pipe lynn. >> give me a break. >> the greatness of the pipel e pipeline. >> it's what he said on air. david, i take people -- there's like, what am i going to say, joe, will you give me a break? come on, man. i mean, it is not nfl. it is not espn. come on, man. no, talk about -- talked about miami, warm and rested and couldn't catch a -- no! >> did you make another reference to the giants? >> let you live that down? >> the opening bell is five minutes away. enough. e llomhier tht'kt's om #5! veth guhe is sykemo ankim.tdtdtrtpoununpgh you're watching cnbc "squawk on the street," live from the financial capital of the world. the opening bell in a couple minutes on this tuesday as we watch both the senate judiciary committee, as the confirmation hearings begin their process. going to be a long few days as we get this week and next. along with corporate guidance and chipotle at the top of the menu. >> let's talk about chipotle. they were down 16 when they came out with the -- just talking about how the last month was. i couldn't believe that people bought into the downside. you've got a down 4.8% comp. people should recognize this is the beginning of the easier comps. some people were saying the estimate was down 3.7% and that is not true. people thought the comp numbers secretly would be down much more. the earnings, 58 cents versus 98 cents, a lot is cost of avocado, which i can confirm. but i will say that, remember, they put out safety rules and changed a lot of things. 18 months is the -- is when people forget. they are buying back another $100 million because they have a lot of cash. i want to emphasize a lot of analysts got negative on chipotle in the last eight weeks, and i think they'll regret that. this is a better number for comp. i don't know if that has much to do with chipotle on air but -- >> as you're talking, pictures of capitol hill, of course. various protests ahead of the sessions hearing. widely reported and talked about. he'll be asked about allegations of antagonism to civil rights. in his past, he's been will ever the committee 30 years ago and denied a federal judgeship. we've seen khizr khan from the dnc over the summer invited by the democrats. it is going to be heated. let's get to the opening bell. s&p at the bottom of your screen. big board, grand vacations celebrating its spin-off from hilton. [ bell ringing ] >> we're doing really well. the stock -- we often hear about stocks and weather and how they have perfect information. all stocks are correctly valued. i think one of the things that's happened in the last -- since the election, is if you thought stocks were valued perfectly, the trump election really changed the way we value a lot of stocks. bank of america, we looked at as a book value situation. suddenly, it is an earnings situation. there is conversion about re-rating of stocks, particularly in the oil. been in the financials and also the industrials. wait a second, i didn't think that company would get a premium multiple. bank of america has great earnings power. it is very much an earning story. matters, changing the way we look at things. >> there's been some reports about increasing friction, say, with the aca. there was a moment to delay the deadline for repeal. there's been leaders of the house, freedom caucus, say we want to see a replacement before a vote for repeal. are you beginning to see the dust kicked up here? is it a problem? >> i saw an interview with the current president, president obama, and he talked about how the changes may not be that stark. this is all very murky. we don't want murky. we want, hey, business, here's the big break you needed for affordable care act. we're not getting that level of clarity. now, the 26-year-olds, whether they'll still be covered, pre-existing. but what matters here is, again, if you're a bull on stocks, you don't want to hear a lot of back and forth. you want to hear, hey, here today, gone tomorrow, here's the new plan, blah, blah, blah. the president, current president, was saying if the republicans are just playing ball, they would be getting exactly what they may want, which i thought was ironic. >> the changes that should have taken place, in other words, to the law to make it better? >> right. well, the idea -- >> or what? >> the subtext was, in order to make the democrats lose, they held this up and probably weren't that far away. i don't know. it is the president of the united states. >> yes, he is. another ten days. >> still president. >> he is. >> he served for our country. >> interesting setup on the dow, as goldman obviously takes the wind out of its sails. the worst performing component. amex was the stop for a second, now behind. >> again, this time, we have another upgrade. let me go over why this is happening. opco is saying, like yesterday's bank of america, they're looking at the earnings power of american express. they're making what they did in 2014. the stock was trading in the '90s. discover and capital one and mastercard, visa are doing so well. i think it is going to the '90s. makes sense. smart upgrade. >> far cry from when costco -- relationship with costco soured. >> that was a big issue. the transition and how they were going to get a lot of new accounts from the costco. great co-branding really did hurt them. i think it is now in their past. i think travel and entertainment is going to do better. we saw priceline and citi. i think american express is maybe, okay, here we go, the cheapest stock in the dow. >> really? >> yeah. >> so speaking of travel and entertainment, we have hilton grand vacations here. a.l. alk gets an upgrade. >> i flew virgin america. people keep to forget, the note was important about they have more gates in san francisco and los angeles than anybody else. these are very well traveled markets. i like the call. i think it is good. delta is about to report. if delta says negative things about expenses for 2017, you'll regret you pulled the trigger on that stock. why don't you wait? >> acena retail, down. >> these are the existential crises we're talking about in retail. let's go over, you're talking about a company that has almost every single -- no, every single one of its businesses is in decline versus what i thought. whether kid stuff, dress barn. i think it's kind of like when limited closed its doors this weekend. ascena has a better balance sheet and i don't want to compare. they can survive. i'm talking about the notion of, what do you do with retailers that are just not strong enough, and whether they are investable? i'm saying i don't think ascena is an investment situation, not with the level of comparable store sales we saw this morning, which are dismal. i looked at the numbers and said, wow, they missed again. one of the things i liked about the company is they said, we're disappointed. it didn't say, we're doing great. >> retailers overall right now are fearful, of course, again about the tax reform plan as it is currently structured, at least out of the house ways and means, with the inability or tax on imports. the inability to expense your cost of goods if it is imported. >> yeah. >> that is going to change the math for so many retailers in this country. much of whom import -- many of whom import the bulk of their merchandise, certainly in aprapra apparel -- >> where does dress barn and lane bryant get their stuff? >> manufacturing has to be brought here, or the dollar is going to go up so much it is going to even out, or you are in deep trouble. >> jpmorgan has laid out the case about why this is such a dangerous group. i don't disagree with the case. i think this is a very hard group. remember, we used to have -- before nafta, apparel was a major business in this country. the coincidence, perhaps, between nafta and the number -- >> you hate nafta. you hate it. >> yeah. i do. >> i know. >> you've made that clear. >> i think the currency is unfair. 4:1 peso when we created nafta and now it is 21:1. i think it needs to be adjusted. it should have been currency adjusted. that's what i care about. >> and the president-elect also doesn't like it, so there is a belief once you get tax reform, this border tax will be a part of it. >> well -- >> the retailers may be lobbying furiously to get rid of it, but we'll see. >> i favor currency adjustment, not a tariff guy. currency adjustment. >> we needed to mention williams. i assume you saw. trying to read through the release and make sense of it. >> wpz got the better of it. >> they're buying -- well, they're selling -- let's start with the selling. selling 65 million shares at williams. then they're going to be buying at 36 a unit, newly offered common units from williams wpz, giving them a 72% ownership stake there. it is a broad based restructuring of the capital structures across both companies sbl the cost of capital is going to decline for wpz. the $25 million at 29 is not hold right now. the convolution of the story has betrayed the excitement about natural gas, which is -- >> and natural gas prices hitting lows because a warmer than expected season. >> that is the peak. >> questions about wpz, also. >> right. now, i will say, remember, i'm a bull on natural gas because of exports. mexico is in deficit. so is the world. i have dominion on recently. they have a big plan shut upping a lot of stuff. i'm a bull of natural gas because of the shipping. but natural gas is a challenge right now. it is going to be. where did i get the 60 degrees? someone tweeted that, 60 degrees in new york. not a reason to own -- >> we're looking for high 50s by the end of the week. >> natural gas is -- these are the months when natural gas has to make the money. and they're not. but i do believe that the long-term demand -- there is a critical shortage of natural gas around the globe, which people with expect to happen and it does matter. we have more natural gas than everybody. maybe perhaps kuwait. did you see illumina today? >> yes. >> people say, what the heck is that stock up like that on a takeover? but it is a new machine. i like what they're doing. putting it out there. seeing that there are companies -- this is the jpmorgan health care conference, has stocks popping. just keep in mind that the conference is going on and that i find it a little more muted. in part because i think they fear tweeting. they fear tweets. >> yeah. >> fire tweets. >> they fear the president-elect's tweets. >> i think if he is following -- i know he is not a close observer of the jpmorgan health care conference but it is a constant -- joe papa said it is a constant issue. how much can you increase prices in an era where the president-elect is very astute? >> it has been the criticism. lack of innovation. a lot more add ons and price increases. >> right. i think it matters tremendously. >> like everything, the criticism is true in some ways and not true in others. >> right. i just got an e-mail that is shocking. my wife is watching in europe. she never watched in america. hi, lisa. she knows i have a show in the morning. this is really giving up the whole ghost. >> i think she probably gets enough of you at 6:00 and all -- >> i know. i think she felt that i workout during 9:00 to 10:00. >> is she ever coming back, by the way? >> in denmark now. >> world tour, right? kind of like the stones. >> yup. crazy. anyway, i mean, tomorrow if she tunes in, it'll be tillerson. i guess it was a one-time only show. >> lisa, good to have you as part of the viewing audience. >> better man than i am. dow is down 42. let's get to bob on the floor. >> good morning, carl. trend mostly in tact. last few week, bond yields to the downside. gold has been up. true today, though the yields are up a little bit. overall, trend still in tact. not in tact is what's going on over in europe. the ftse 100, all the indexes, all moving. ten days in a row the foot tsi ftse 100 is up. you're at record highs over at the ftse 100. mostly exporters. the uk stocks. the producer prices in china were the fastest pace since september 2011. anglo and glencore. throw in astrazenica and other sectors, and you have a rally going. in the u.s., the three sectors that matters this year, health care, materials and tech. those are the ones generally holding up well today. tech was positive at the open. the big disappointments have been bank and energy stocks here. i want to point out how some of the oil stocks are doing. we're down almost every single day for big energy, including exxonmob exxonmobil. there's a lot of expectations. they're expecting exxon to double earnings this year to still trading at 21 times forward earning. that's had a problem, as has chevron. weights on the dow since the beginning of the year. metals and mining are the opposite. free port, one of the best performing last year, would sell that off in the beginning of the year. that hasn't happened. they keep going and going on the strength of the china data. u.s. steel, vale, all been strong. the fang stocks are helping out the nasdaq. market, cap-weighted indexes. apple is the biggest, couple points on the upside and drags them along. third reason the nasdaq has been doing well. the out performance of biotech. amgem, adds billion. get them up 6%, 8%, they drag the indexes with them. you have fang and bio tech, health, throw in a few semi-conductor stocks. intel up 1% or 2%. texas instruments are up 2%. they drag the whole thing up here. very clear reasons why we're moving to the upside. let's take a look, finally, at small business optimism index. trade indexes normally never min mention this. i had guys mentioning this to me today who never talk about it. biggest jump since 1980. december numbers, 50% of those surveyed expected the economy to improve. back in august, only 12% expected the economy to improve. you almost never see a gain of 38 percentage points. from people expecting a turn around in the economy like that. it is the big story today. whether it translates into more earnings, which is what we're interested in in 2017, is not clear. we'll start finding out on friday when the big banks start reporting. remember, it is about 2017 earnings guidance, not so much about fourth quarter earnings. dow is down 34 points. back to you. >> thank you, bob. let's get to the bond pits and rick santelli. >> good job, bob. you know, nfib, national federation of independent business, not many talk about it, as bob pointed out. a jump we haven't seen since the '80s. i want to add something to that. it rose to a level we haven't seen in 12 years. 12 years. that's pretty good. december of '04. the only reason i bring it up, i've always thought confidence indexes, they're a big lagging, of course, when equities do better. i'd suspect you'll see better confidence, whether it is small business retail, whatever. we've seen in a lot of the other metrics that measure conference, whether from the conference board or michigan. it goes hat in hand. the interesting point is, if you look the markets and say, legislation, appointees, cabinets, votes, market is ahead of itself, logical and i get it. here's an argument why ill logi may prevail. it is a look into the psyche. maybe there isn't a time line for how long the magic lasts but it is an alternative reason to think it could last. this has been the pattern since the double bottom. in 2012, basically won 3135. last year, 135. it seems to form ranges and go back to the trend, which i believe now for higher rates but maybe not expaiduated rate. let's keep booms. all about patterns. let's nail it from november 1st. look at bund. remember the pattern. doesn't it look like tens minus bunds? it is. it is our ten-year. dollar index looks the same way and so does the s&p 500 with one cave yat caveat. the tightness on the s&p, nasdaq is nor that direction, the fact that there's been so little giveback, i don't know, i think the half dollar, half stocks, maybe the interest rates are going to hunker down while they battle out if there is retracements yet to come. carl, back to you. >> rick, we'll check in later. still to come, athena health ceo jonathan bush as congress pushes to repeal and replace obamacare. dow down 35 points, l led lower by goldman on the downgrade. back in a minute. ♪ apple requested permission to conduct high-tech manufacturing of data center products of the facility in mesa, arizona, according to a filing. apple has permission to make consumer electronics components at mesa. the president-elect has been pushing apple for manufacturing in u.s. gm's president at the detroit auto show saying the industry has been unfairly singled out. why not apple? quote, i don't know. for example, how many iphones are made in the u.s. for u.s. consumption? provocative take. >> i think i always looked at apple as having -- building the largest building in the country. it is kind of a big construction project. >> true. spending a lot of money on that. >> look -- >> they do manufacture ubiquitous product somewhere else and bring it back here. >> almost all of tech has, over the years, felt compelled to build overseas. certainly, apple is one of them. i'd like them to build more here? sure, everyone would. the reasons tend to be labor and where they sell. intel put plants here. this is a new construct. when the auto companies are targeted, i think they pretty much said, you know what, we're going to rethink taking things to mexico. remember, currency, pension plans, pollution control, i mean, other countries have created a situation where you could argue they've been in trade wars with us and haven't realized because they made it so easy to take our jobs. >> remember, if you're an exporter, you are a huge beneficiary, potentially, of tax reform. >> right. >> doesn't get taxed at all. >> yes, i know. >> exports not taxed. imports taxed. you depreciate the capital spending immediately, right away. >> look, everybody wishes everything was made here. there is a reason people stop making things here. cheaper overseas. sorry. that's the way it works. that's what happened. it is why we don't make clothes here. it is cheaper in honduras. >> right. you can do a lot to change the equation beyond the hourly wage. >> yes, you can. remember, currency has been the way people take it. >> we'll get stop trading with jim in a moment. dow is down 32. don't go away. now we just need 500 more... translated into 35 languages, personalized oh and shared across the 7 continents. (other languages spoken) look abbot, i got it. it's a miracle. ♪ time for cramer and stop trading. >> we have ppi china numbers out last night. 5.5 versus 4.6. it has a lot of the metal stocks. i want to focus on mccal gaming. exceptionally high. i'm surprised that wynn and lvs aren't up more. this is what they trade off on. any gamers, mid-sized gamers is going to matter. these stocks are momentum stocks and maybe the momentum will go their way. i think they should be up. >> all right. what's on mad tonight? >> ew, sciences coming from the jpmorgan conferences. this is a device for surgery. we are focusing on the humanization of pets. taking care of pets, walk your dog, david, which i think you desperately need. >> we actually have used them. >> you have? >> it is like airbnb but for when you're out of town and want your pet to be with someone. >> the kennels cost a lot of money. i think this is a great business model and you ought to look into it, david. maybe they can take your dog for a couple of years. >> until death. >> no. i want to visit him. we love him. >> jim, see you tonight. >> thank you, guys. >> ""mad money"" at 6:00 p.m. explusiclusive with jonatha bush, as congress looks to repeal and replace obamacare. watching senate judiciary and waiting for the q&a to begin with sensor sessioator sessions. back in a moment. ♪ good tuesday morning. welcome back to "squawk on the street." sarah is with us from the icr conference in orlando, florida. a lot from sarah this morning. she'll join us with an exclusive with the ceo of lululemon. con f monitoring capitol hill, the confirmation hearing for jeff sessions is underway. dow is dragged lower by goldman and managed to hold close to the flat line. got economic data crossing the tape. let's get to rick santelli. rick? >> i'll tell you what, this is fascinating. if you're looking at november data, obviously, we've had some pressure, but on the inventory side, we popped 1%. we were looking for 0.9% but 1% is unique. pause we haven't h because we haven't had a month over month pop of 1% since november of '14. if we look at the sales side, disappointing there. looking for 0.5% but up 0.4%, less by 0.1%. last look, lost 0.3% from 1.4% to 1.1%. jobs is an interesting one. on the opening side, looking for a number around 5.5 million. we got it. 5.522 million, following a revision of last month. at 5.52, e 5.53, ended up at 5. million. a lot of people looking at the quit rare otio. thinking as it moves higher tlr there is an emboldened work force and may have implication of the behavior. incoming trump administration in discussions with speaker ryan over a controversial border tax a week before the inauguration. joining us to talk about politics and the markets, bmo's cio, and james, wells capital management chief investment strategy. good morning to you both. >> good morning. >> jack, let's begin with you. we've taken stock of this rally. you argue it's left the market expensively priced and vulnerable to disappointment. why? >> yeah, expectations are running pretty high right now. analysts as a group are expecting earnings to expand 13.5% in 2017. it is possible, if all of these proposals come through, i suppose. but if you do get any kind of political pushback, especially on the deficit side, you know, if nothing else, they'll be delayed. certainly won't be delivered this year. >> jim, if i read your take right, you actually think that maybe the -- quantity fie fuantifyaple things -- we saw the spike in the small business measure this morning and also investor business owner, consumer confidence across the board peaking. it's been good to buy low confidence readings and bank on a wall of worry. has that changed in this environment? >> well, i think, you know, mike, we spent the better part of the eight years of this recovery with nothing but fear. fear of the future. for the first time, we're seeing the most robust evidence that the animal spirits are being awakened. i don't think, if they are, i don't think it is just going to be a couple month event. i think that it'll last longer than that. there's just a confluence of wonderful things coming together. revitalization of growth after two-year hyaig hiatus, rebroade growth around the globe, ending global deflation, lifting rates off zero, normalizing monetary policy and now pro-business, less regulations. i just think it's come together to finally lift confidence among consumers and businesses. you're seeing it, animal spirits in the financial markets. i think as we move to 2017, we'll see more into the private sector economy. maybe capital investment, housing, spending. spending that takes confidence to do. that's something we just haven't seen in this recovery. i think the first time it shows up, i don't think it is going to be a flash of the card. >> what about jack's point, james, that once we have to start watching the sausage get made, the market, at some point, turns into a show me state. when does that happen? >> well, i think, carl, i agree with jack, there will be pauses along the way. i agree with that. i just think that we've woefully underpegged interest rates below levels. i think they could come up quite a ways before they're meaningfully restrictive for the economy or the stock market. i think we're going to have a correction, perhaps, but i think it is going to happen from higher price levels in the stock market and higher bond yields. i would erre err more on the si the public coming in on a risk of a 4a into the markets. i'd stay with that and look to cash out or get more defensive in the year from higher levels. >> jack, the entirety is -- the irony is what could be great for the economy. i agree with a lot of jim's points. may not be great for the stock market. keep in mind, we've had very easy monetary policy. that's allowed corporations to take on unprecedented levels of debt. where that money has been going has been into buyback. that's helped stocks tremendously. if now that either slows down a little bit because of higher interest rates or gets diverted into cap backs which, of course, would be great for productivity, great for the economy, that doesn't land in shareholder's pockets right away. that could create a little bit of an air pocket. i'm not suggesting the market is going to plunge, but i think we could tread water as things reset. but longer term, i think these are great pieces for the economy. maybe not near term great for the stock market. >> jack and james, good to see you. thanks for the insight. check in with you later. keeping an eye on the senate judiciary committee holding a confirmation hearing on capitol hill for the president-elect's pick for attorney general, senator jeff sessions. our john heaarwood is monitorin and joins us. >> the jeff sessions nomination is a fascinating collision of the forces of personal relationships within the senate club, partisanship and the political power of race in the united states. we're having opening statements right now. we've heard from the chairman of the committee, diane feinstein of california. we have seen the prepared statement. haven't heard from jeff sessions yet. of course, he served with these senators for quite a long time. this is someone who was rejected by the senate for a federal judgeship during the reagan era. that's part of the backdrop of the discussion today. and the issues at play during the 1986 nomination that was rejected had to do with his attitudes toward race, toward african-americans, toward the civil rights movement. now, we've seen in the prepared statement that jeff sessions has prepared, a couple of nods to those issues. first of all, he has led off his statement by saying to other senators, and this is in the printed statement, haven't heard him say it out loud, you know who i am. you know what my values are. you've served with me. you know how much i revere the department of justice. a second statement later in his lengthy, prepared statement, says, i can assure you that i understand the horrendous impacts of discrimination on our african-american brothers and sisters. trying to make the point, yes, i get it. he also includes lgbt rights, as well. indicating that he understands the rights of all americans, even coming from a culture and conservative state like alabama. that people deserve civil rights protections on issues of gay rights, as well. he's making those points. we've seen a brief disruption at the beginning of the hearing. you had a couple of guys dressed in kkk outfits walk in. they were escorted out of the chamber. it was a very brief disruption. but that shows the volatility of the environment. one notable thing that diane feinstein mentioned and, again, she served for more than 20 years with jeff sessions, she talked about the backdrop of this hearing being the fears, especially among african-americans, of what a trump administration might bring. you can expect to hear jeff sessions respond to that concern when he both gives his prepared statement and responds to questions from senators, guys. >> john, we'll be coming back to you in a few moments. hopefully once the q&a begins. john harwood in washington. this morning, the battle to repeal and replace obamacare is heating up. we'll be joined by the fiery certifiable record eo of athena health, john bush. also, sarah is live at the icr conference where she has an exclusive with the ceo of lululemon. we'll be back in a minute. seeing is believing, and that's why we're opening more xfinity stores closer to you. visit us today and learn how to get the most out of all your services, like xfinity x1. we'll put the power in your hands, so you can see how x1 is changing the way you experience tv with features like voice remote, making it easier and more fun than ever. there's more in store than you imagine. visit an xfinity store today and see for yourself. xfinity, the future of awesome. live picture here on capitol hill. senator jeff sessions at his confirmation hearing for attorney general, making his opening statement. just sworn in. as headlines develop from this throughout the morning, we'll bring them to you. big news out of chipotle, releasing preliminary fourth quarter results. not that great. sarah eisen is at the consumer conference in orlando and will be watching that, lululemon and other things today. hi, sarah. >> chipotle ceo is here. just in the room next to me, met with investors and analysts off the record. you can imagine, he faced many questio questions. bottom line, sales and forecasts both coming in below. the comp store sales also falling. 4. % in the quarter. and it was a bumpy one. they fell 20% in october. down 1.4% in november. they rose 14%, 14.7% in december. why? well, because of easier comparisons with the year before. remember, the prior december, december 2015, the company was reeling from the food safety scandal. comps were falling 30%. in other words, chipotle is facing uneven and weaker sales. analysts are telling me here that chipotle executives are taking a close, hard look at changing their culture. gearing it more toward the customer experience versus what they call had been their focus in the previous, say, 20 years or so, which is on restaurateurs and staff and building a big team. they're introducing new metrics to keep up with food quality, speed and service. again, about the consumer. they're increasing ad spending on tv, especially on digital. that's what we hear is really the big message from chipotle management this morning. they're optimistic, that they've identified the problem. they clearly have difficulty predicting sales going forward. high-risk business. they gave analysts a road map for the new direction. interestingly, guys, it was less about the food safety scandal, which they're putting behind them and they've improved safety standards across restaurants, and more about totally changing the culture and freshening up the stores to improve the customer experience. >> interesting points. cramer, of course, sarah and mike and david, argues we haven't had time for consumers to truly forget. he thinks it is an 18-month window. >> certainly, consumers probably haven't kforgotten. you don't know the normal run rate, what it is going to be. improvement, december better than november and better than october. but it doesn't really get you to the level where the store level profit margins are up to snuff. the way the stock is acting now, bouncing, is interesting. maybe it is a little bit of a hint that the stock is getting washed out. you have 17% of the stock sold short already. the street hates the stock right now. 30% of the analysts have a buy on it. basically, they've kind of turned their back on cmg. the question now is, did it get washed out? you had the lows in november and december and stock were successively higher. who knows if it is building a base for return. >> i would say the other factor is the entire restaurant sector outlook has improved. chipotle, like some of the ovthr fast casual and fast food restaurants suffered from decreased mall traffic. that's what we're hearing from the retailers. chipotle has individual problems but with the retail problems come talk of a restaurant recession. something we heard leading up to the election. that's something i'm going to be asking guests today, especially in this great fast food round table we have coming up in "squawk alley." we've seen soaring consumer confidence. is the spending going to come next? remember, the fast food companies were having trouble competing with grocery stores. the food deflation meant it was cheaper to go to the supermarket and make your food at home. is that changing after the election? not to mention, corporate tax rates. a lot of the big fast food, fast casual companies, chipotle included, have high, effective corporate tax rates under the promised corporate tax reform from donald trump and republicans. how much has the outlook improved? of course, the retailers. we're going to talk about that, as well. that'll be the next interview with lululemon ceo. that is change consumer behavior post election in a tough industry. >> thanks very much. as we head to a break, let's look at what the markets are trading in the first hour of the session. very modest losses. the dow weighed down by the 1% loss in goldman sachs. the nasdaq, out performer, has been the pattern the last three days. more ahead on "squawk on the street." stay with us. let's get to rick santelli for the santelli exchange. rick? >> thank you, david. good morning. i'd like to welcome my special guest on confirmation tuesday. professor charles from the university of chicago. charles, i know in schools these days, civics has been downgraded. general political landscape. many young people aren't as up on maybe as much as you and i were at that time in our life. to think this is the most contentious we've seen government, i think you could probably dispute that, couldn't you? >> i would tell anybody who saw the other contentious hearings, i think people say it because if you look at voting in the senate, there's almost no democrats whose voting record is as liberal as the most conservative -- there's no republican whose voting record is as liberal as the most conservative democrat. mansion and susan collins overlap a little bit. essentially, you have two different parties. they appeal to different bases. you'll see that in the confirmation hearings. >> so if i read you right, what you're kind of saying is if you look at the timeline from most liberal to most conservative, it is the edges that are giving the problems. the super progressives and the kind of freedom caucus tea party groups. they are making it a little more difficult to do compromising. is there anything in the hearings to pay close attention to? >> absolutely. the first thing is we don't know all the information about the candidates. haven't turned in all their paperwork. there are a lot of lawyers to see if there is conflict of interest. i think what the democrats strategy under schumer will be is they talked about going after as many as eight nominees that will actually be a ninth. they'll go after whoever is nominated supreme court. but i think what they'll try to do is see which mud sticks to the wall, and then they'll focus on that one. sessions will obviously be one. pruitt at environmental protection will obviously be one. i think they want to go after tillerson, not to stop his confirmation, but to get some clarification on the russia policy that's going to be forthcoming from trump. they'll go after several of them. >> is it a good strategy? let's be frank here, i have no problem with any strategy that isn't going against the grain and the intent of the founding fathers and the constitution. if the democrats think it is a good strategy to delay and push back, they're well within their rights. but is it a good strategy? >> i don't think it is good to slow walk everybody. the republicans gave barack obama nearly all of his cabinet right at the beginning. we need to have a government that can step into place and work. i think the democrats have every right to do a hard vetting if anything come come s up. they have a right to go after it. to slow walk these, as chuck schumer said, is not only bad for the country but i think it'll be bad for the democrats. because if people said overwhelmingly they want to get things done, and the party that obstructs in the last administration was the republicans. if the democrats put themselves in that position, it'll be a mistake for them. >> charles, it is always a pleasure. the knowledge on the political science front is terrific. thank you. >> thank you. >> carl, back to you. >> rick, thank you. we're watching senate judiciary. speaker ryan is making comments on aca. let's take a listen. >> -- medicare reforms, for instance. are you committed to ensuring that the fiscal 2018 budget balances in ten years? also including those -- >> we haven't even gotten the budget from the trump administration yet because the trump administration hasn't occurred yet. right now, we have an fy '18 budget resolution, which is a tool for repeal. the traditional budget will occur this spring. we will get a budget sent to us from the new administration. the budget committee will dispose of it then. we're getting ahead of ourselves as to what the budget will look like. they haven't been sworn in yet. yeah? >> speaker ryan, what tax issues will be discussed with the trump transition? >> all of them. andy? >> to follow up on the budget, just the last few days, part of the supplemental package, military supplemental coming, reince priebus said over the weekend he doesn't want to meddle in medicare and social securi security. president-elect trump is going to repeal the -- >> so what's the question? >> my question is, why should we form the conclusion that the budget is taking a backseat -- >> i don't think that at all flt one of the things is getting people back to work, economic growth. you have to get the economy growing. that's what tax relief and reform is about. obamacare is a budget buster. it wrecks health inflation and makes promises that will not be kept. so we're going to fix these problems. all of these solutions we're bringing through this year help the bottom line. help the fiscal hemt and the al economic health of americans. what the budget looks like, we don't even have a trump administration yet for a budget directory that will send us a budget that we'll work on. it is get ag head ting ahead of ourselves. >> last question. >> you said you want to bring it all together to currently repeal and replace. how much of the obamacare replacement and reconciliation -- >> we don't know the answer to that. that's a question that is more of a senate question as to what you can put in reconciliation and what you cannot put in reconciliati reconciliation. those of you who are budget people know how it works. it is a senate test, not a house test. we'll pass as much as we can through whatever vehicle we've got, and then pass all the other things through regular order outside of reconciliation that show you the full scope of what a real replacement effort looks like. just know, repealing obamacare in the beginning and giving people relief and allowing companies to compete and giving more choices to begin with can help heal this problem we have. so immediately, we can provide relief this year to families struggling under obamacare. that's good. then we want to build on that success by even getting more reforms through regular order if it has to occur outside of reconciliation. we have ideas and solutions. obamacare isfaye i -- failing quickly. families can't go to the doctor because their deductibles are so high so they skip having health care. the premiums are so high, more and more people aren't buying health insurance. only people who are desperate to get it are buying it, and that is a death spiral. we're getting warnings from insurance companies that they're pulling out and people have zero choices this year on top of more premium increases. this law is failing quickly. we've got to step in and provide relief and a rescue for the american people. that's exactly why we're doing what we're doing. thank you. >> speaker ryan, as you heard, saying the aca is in a death spiral, in his words. says the goal is to bring a replacement along concurrently with repeal. and that republicans will ensure a stable transition period amid that repeal. when we come back, we're monitoring that. confirmation hearing of jeff sessions on capitol hill to be attorney general. we'll go there live. plus, obamacare under pressure. we'll talk to the ceo jonathan bush of athena health. don't go away. good morning. i'm sue herrera. twin bombings in kabul, killing the 2 a2. the taliban claiming responsibility for the attacks. senate democrats took to the floor last night in a talk athon to derail obamacare as being reckless. they wanted to show the american people the democratic party is going to do everything it can to prevent its dismantling. researchers at university hospitals in cleveland found less than half of adults under 40 get a prescription for statins to combat high cholesterol. 1/4 of young adults with high cholesterol statins. the clemson tigers are college football champions for first seem since 1981, upsetting alabama with a last-second touchdown. it prevented nick saban from claiming his sixth championship, which would have tied him for the most all-time wins. amazing game. that's the cnbc news update this hour. carl, down to you. >> thank you very much, sue. meanwhile, house speaker paul ryan meeting with key members of the trump transition team last night to discuss a controversial plan for border taxation. michelle has more on what happened last night. >> steve bannon confirmed that's what the meeting was about last night. this is an explainer. the current structure of u.s. corporate taxes. all you tax experts out there, there is an over simplification. worldwide profits, multiply it by 0.35, 35% tax rate, those are the taxes. >> reporter: a cofor the corporations. this is right house, domestic revenues minus domestic cost, new tax rate of 20%. those are the taxes. stare at this for one second. two things to note immediately. number one, we go to a territorial system. there's been lots of complaints about a worldwide tax system for the united states, where the only major trading country that does that. two, you can only subtract your domestic costs. this is why retailers don't like this. nearly everything they buy is from overseas. so they can't deduct it. here is where all the controversy is. the supporters of this say, don't worry. prices aren't going to go up at walmart because this is so strong dollar that walmart is going to be able to buy more stuff with the same amount of money and, hence, it is going to be a wash when it comes to the actual consumer. but a lot of people out there, ceos, say, going to trust the economists? that's where the doubt is. >> michelle, you know, the other big question here is not just retailers but companies that are basically creating a global supply chain. these are creating tax incentives that would have them upended. >> yeah, absolutely. for sure. but the response that you'll get from supporters of this argue that what it does is it makes it more similar to what other countries do. all our major trading partners have a different tax system. they do a vat tax, a sales tax. what is important to know, mike, is that the minute germany exports something or a mexican company exports something, all of those taxes they've paid, they get a rebate. so, therefore, all of those countries implicitly subsidize exports. whereas we don't. that's why they're trying to do that, to even that out. >> right. of course, michelle, this is a key, as you say, as are other parts of the house ways and means blueprint. we should point that out. this is what we're all talks about because it is the only thing out right now. >> this is not trump. this is the house. >> this is not trump. this is the house. where, by law, they have to come up with this. it'll get to the senate at some point and we'll see where trump ends up. based on his tweets, and we may find out more tomorrow at the press conference, he is on board with this, given he's mentioned the border tax a number of times. >> used to use the worde border. does that mean he's really talking about this and not punitive import taxes? i don't think we have a definitive answer to that. some people might like to think that's what it means but we don't know. >> we don't have definitive answers. michelle, we'll keep watching to get them. appreciate it. send it back down to sarah at the icr conference for a look at what's coming up. >> certainly, that border tax issue is front and center for retailers here. we're going to look at the athleisure industries. nike is down. lululemon rose last year. why it is beating competition is and what happens when amazon might enter the fray. we'll speak with laurent potdevin, the ceo of lululemon, coming up. ♪ we're drowning in information. where, in all of this, is the stuff that matters? the stakes are so high, your finances, your future. how do you solve this? you don't. you partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. morgan stanley. hey!nicole. i just wanted to think your support team for walking me through my first options trade. well, we're all about educating people on options strategies. i won't let this accomplishment go to my head. get help on options trading with thinkorswim, only at td ameritrade. with valuations up lately, are stocks simply becoming a little too expensive? our traders debate at trading nation.cnbc.com. now, more "squawk on the street." obamacare is a huge budget buster. it wrecks health inflation. it makes promises that will not be kept. so we're going to fix these problems. >> that was speaker paul ryan just minutes ago, calling the affordable care act a budget buster. certainly, it is a focus at the jpmorgan health care conference in san francisco, where our meg resides, and she joins us with jonathan bush. >> jonathan bush, thank you for joining us. >> a treat. thank you for having me. >> we have to start with the comments from paul ryan, that obamacare is a budget buster. what do you think about it? >> mathematically, you know, the cost of health care insurance is cranking up at a pace that is stunning and largely related to ill-considered aspects of the law. now, obamacare is like dyslexia, a word for everything that goes wrong with reading. in this case, everything wrong with health care. there are three fundamental things causing the jack in prices on insurance. there is this risk adjustment pool problem, where insurance companies do better at savings. first thing they have to do is send a check to their competitor doing less well. what the front door? it is badly tuned. it was an idea, we want to help people sick be allowed to move around. it was well-intentioned, sort of elitist, not appropriately considering the market. there is another problem with the provider groups that similarly, you only get savin savings -- the only way you profit from savings is come pettipet i -- competing against yourself. consumers, if you're sick, you cannot pay, not get fined and as soon as you're pick, jump in and not pay a consequence. these were well-meaning and could be trimmed. they could be tuned. i think probably when trump talks big and acts little, so i assume little things would be great. >> from what you've observed about the talk around repealing obamacare, what is your expectation for what that looks like? >> i imagine it is things like redefining the minimum legal mandate for what it is to be covered. the ability to have catastrophic, sort of accident-type health insurance, which could cost half as much, and what many farmers in america want, i don't want to be broke if my tractor rolls over on me, that would cut the cost that is monodate mandated, cut the scale of the redistribution problem and reduce the market. any market forces that existed at the beginning of obamacare have been minimized. there's been a lot of increase in vertical monopoly power in each market. nobody can -- if i choose the guy who does the knee half as expensive as the other guy, i don't keep the difference. i never see it again so i never look. i never even know. allowing a little bit of deductible, a little bit of consumer power to sit in here insurance and day to day health care consumption is a pretty simple putt for the new administration to pull off. still cover everyone, still redistribute but allow prices not to go up 20, 30 -- one of the prospects proposed a 40%, one-year increase in their rates, just to stay in the marketplace as an insheurer. >> people are concerned about losing insurance all together or losing some of the good things about the law. >> yeah. >> what do you say to those people? >> i think my take is the way that ends up sort of compromising is you limit the definition of what it legally mandated insurance is to something less to half the size it is today. oh, but what if they get stage four cancer and want a brain transplant? well, we need to cut back to something we can afford. the non-brain cancer people don't want to cover that. they want to be able to have a job and when they get a raise, a little bit of the raise goes to their bank. right? right now, all of their raise goes to health care. for the last 20 years, the reason i think we have trump, is because -- i'm obviously a health care guy and think everything is about health care, but if you look at wages at gdp growth, in the middle class, cut the poor who get covered and the rich who don't care, you get this group who has been banging away, trying to get a slight raise in wage. all of it has gone into increased health care costs. i don't want this thing. whatever you're making me buy, i don't want it. we want them to have something. a little less would be great. >> i want to ask you about -- i think we have a picture from last year here at the conference. you made headlines. >> i don't recall. >> you saved a man on the sidewalk. >> oh, yes. >> i kept him alive for two days to incur another $250,000 before he died. >> is that really what happened? >> yeah, i think so. sorry. too much, too early. >> that's terrible. you said everybody was watching and not doing anything. much like the health care system. >> yes, that's the thing with society. >> what did you mean by that? >> i mean, there is a huge opportunity for providers to profit through generating savings. but they have to give up a little something to start that journey. right now, they largely profit or break even by increasing costs. the pivot takes a risk. you let go of the one trapeze and for a minute, you have none until you grab the better one. right? that let go is fundamentally contrary to the culture of medicine. partly for good reasons. the hippocratic oath, first, do not harm. it is highly regulated. this thing called jaco that can show up like stormtroopers at your hospital and inspect what binders you have for the fire drills. if you don't have them, you're shut down. there are legitimate reasons why we've become so fearful rather than cautious. cautious on steroids. but anyway -- and it doesn't take many. we don't need every hospital and provider group in america to let go and grab the other. the few that grab, hopefully people are on athena net and will clean the clock of others. we have surgeons and hospitals in the country. we need a few people to dive in. i think '17, we will see it big time. >> jonathan bush, we'll have to leaf leave it there. >> i was joust gust getting sta >> i know. i'm sorry. >> thank you, guys. >> thanks. always enjoyable to listen to jonathan bush. let's go from one john to another. let's get a look at what's coming up on "squawk alley" top of the hour. >> we're going to continue to track the confirmation hearing of sensor jeff sessions. a lot more on the menu. kayla is at the fin tech festival with former minnesota governor. meg is going to come to us again from the jpmorgan conference with the ceo of regeneron. fast food tables with sarah. david, back to you. >> thank you very much. when we come back, sarah is sitting down exclusively with the ceo of lululemon. we'll get his take on the state of the consumer, retail and the trump era. we have a lot more ahead. stay with us. when you travel, you want your needs to be understood no matter where you go. you want an experience that feels highly personalized. with watson on the ibm cloud, travel companies like wayblazer can apply cognitive analytics to social data to understand what a destination is really like. and who exactly, it will appeal to. today watson is helping businesses create experiences that revolve around you. because that's what the ibm cloud is built for. welcome back to "squawk on the street." the annual icr consumer conference is happening today in orlando, florida. joining me now, cn nrkcnbc excl is laurent potdevin, the ceo of lululemon. you narrowed your sales and profit forecast to the higher end of the range, which isn't the kind of indication we're getting out of retail right now, that it has been a strong holiday season. what did you see? >> i think if you go back to, you know, post-q3 earnings, the beginning of november was choppy. since black friday, cyber monday, i mean, we really saw sort of the business really strengthen. i think the combination of the election, the shifting in the timing of the holidays really affected sort of the traffic. then i think behavior. sort of microbehavior changed a lot, too. when you think about black friday and cyber monday, we had, you know, plus mid-20s comp. what i was most excited about was the fact that in a promotional environment, we had another 20% comp on full price product. >> yeah. managed to keep the prices. >> that continued. you know, if you look at black friday's increase, we did 85% of the business at full retail, which we're excited about. >> you mentioned the word traffic just now. last quarter, the comps were driven by pricing. traffic was a problem. is that going to recover? >> i think traffic from a micro standpoint is challenging. standpoint, we're waiting for that equalibrium. and we're really trying to give the men their full assortment and allow the women's assortment to be broader. and then we have the locals, smaller fore mat. that allow us to be in market, and that have a smaller market holding velocity. in the meantime, we are waiting not only for the traffic to come back, but coming back. >> it is hard to say whether or not it was the timing of the election or the holidays. we have seen people be really intentional with their purpose. so when you think about traffic, we're not going after every bit of traffic, but highly qualified traffic, if you have been in the store in the holiday season. it's really, really busy. >> a lot of people look at nike and under armor down double districts, and they're wondering what that tells us about athleisure as a trend. >> i think everyone has a different definition for athl athleisure. leading an active lifestyle is a couple decade trend. i went to an amazing studio, from spin, yoga, and meditation, so i think people wanting to live a active, mindful lifestyle, i think we're very competitive. >> i think that when you have more competitors, you have a bigger market. we had people entering the market for quite a few years now. and it really validates the strengths of the market, our positions at the high end of the market, driving function, puts us in a position where i think we have tremendous opportunity to grow. >> you source most of your producting from asia. >> we have a very balanced sourcing strategy. about 17% comes from china, but we have sourcing in sri lanka. >> but this would be difficult if they approve the import tax. what could that mean? >> it is too early to tell. it could have significant ramifications, and until we know the scale it is hard to speculate. >> but you would have to pass it along to your consumers, wouldn't you? >> it would have ramifications for the strategy, and likely ramification to just the currencies of the places we're sourcing. >> are you more or less optimistic after the election? >> as we build a global iconic brand, i think we're really immune to the political landscape. >> toyota is not american, and trump called them out. >> i think everyone loves canada, and the active mindful life still is good for everyone. >> investors leek this story. i know you're going to london tonight, how is the rollout going? >> it is going really, really well. i was in shanghai, we opened two stores, outstanding locations. if you have been to ifc hong kong, we have a great location. both have done -- really exceeding our expectations, and tomorrow, we have a big opening party for our store in london on re jon street. i have only seen pictures so far, but it looks beautiful. when you think about the street, we'll have london really well under control. and we have seen really nice inflection points. >> finally i want to ask you about innovation. you are in the sweet so the of fashionable athleisure trends, who is seeing the fastest growth and the biggest innovation behind it? >> i really see -- it is really dry three years ago today we have been able to bring a lot of innovation. our bra business is on fire. you have those two anchor categories on the women's side, and in the men's side we're growing in the mid teens quarter after quarter. i'm really pleased with that. >> i had to teach all of my male co-anchors about what abc pants were all about. >> the ceo of lululemon, next hour we'll have a conversation with three fast food ceos, a lot going on in the restaurant industry, all chains i don't expect you have been to any of them. >> i think you would be correct in that assumption, sarah, thank you, we'll see you later. as we go to nasdaq, that is another record high, stay with us. this car is traveling over 200 miles per hour. to win, every millisecond matters. both on the track and thousands of miles away. with the help of at&t, red bull racing can share critical information about every inch of the car from virtually anywhere. brakes are getting warm. confirmed, daniel you need to cool your brakes. understood, brake bias back 2 clicks. giving them the agility to have speed & precision. because no one knows & like at&t. welcome back to "squawk on the street." crude prices are marginally lower, well under $52 a barrel. crude is falling while the dollar is softening and many are concept all of the opec cut. many players are staying the course. the issue of uncertainty. the oil market hates it like the equity market. >> good morning, it is 4:00 p.m. at snaps new international headquarters in the uk. 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