Transcripts For CNBC Squawk On The Street 20170501

Funding. And twitter Ceos Jack Dorsey purchasing more stock. Are investors buying it . As we said some big earnings from the likes of apple and facebook. We have the fed meeting two days. We have the jobs number. The french Elections Come up this weekend, jim. Everybody is looking at seasonality trying to figure out what may means for stocks. What are your thoughts . Well, for years i always felt that you do not want to be in tech because were about to go into the summer slowdown for europe. Actually, europe is much stronger this year and i no longer feel like theres a sell in may problem with tech. We know that sell in may doesnt work. Its 5050. But there was a basis for it and the basis for it was most companies in europe just shut down for july and august. So you have to anticipate that. Thats not going to happen. Instead, it might be the other way. I think europe leads us right here. Meanwhile, guys, obviously, big week in congress. David, i know youre going to tackle some of the issues, looking at the investment climate, not only from the macro standpoint and what congress is trying to tell us. Yeah. Well be hearing from milken later on today and questions continue to rattle around about the tax reform heat plan that we got last week from the Trump Administration. Certainly over the weekend as you guys know a lot of people looking at that and waiting for the real details to come. And the debate to come between the administration and congress and where we actually end up given that it does seem to generate significant potential deficits despite what of course is the treasury secretarys claim of Significant Growth that would come along with it and take care of them. But that, carl, is certainly something that the market is still trying to digest in terms of where it goes and what the likelihood is of what we end up with. Something we have been december kug now for discussing now for a number of months and will for months to come. Im sure you saw some of squawk this morning, ben bernanke, talking about a number of things. Saying on qe so far, so good. And then also tackled the idea of whether or not 3 growth is sustainable over the long term. Lets take a listen. On a sustained basis, its certainly possible but probably not that likely. I think if there is a big tax cut that lowers tax rates, you might have a bump because of the increased demand, increased consumer spending. That gets you over 3 . Um, probably not. I would say take the under on that. Interestingly, jim, he did say the b. A. T. Is interesting to him as a consent. If you created it from structure, its smart policy, called Corporate Tax the low hanging fruit. Did we learn anything today . Well, i think that this is a former fed chair who really does not believe this economy is basically ever going to be able to return. I felt to some sort of incredible growth. What did he talk about . He talked about pretty full employment. He talked about the things are sanguine after the obama recovery. If this is all the economy can skr generate its surprising. I dont think that 3 is not in the cards this year. Next year, theres a dead on arrival notion and what congress will do. I think david referenced the one page sheet. There are a lot of people i spoke to this weekend that said one page sheet was kind of embarrassing. After all of the talk about repeal and replace, nothing. After all of the talk of taxation and how it will be reformed, one page, this makes you feel like nothing will happen this year. David, you had to feel and maybe the people out there are saying the same thing. Is this all there is . Yeah. I mean, i think thats the key question. You know, youre right, jim. I think theres been a lot of reporting going own from our network and others that indicate that treasury was not expecting when the president actually said theyd plan a present a plan last wednesday. I think it was the friday prior to that. This is rushed. Its very much unclear where treasurys team on tax policy actually stands and how much time they had to work on this. I think there was an expectation perhaps that youd have a much more seasoned rollout come lets call it june with a lot more details. We didnt get that. We have to see how that gets baked in over the next few months. But right now the debate is on a one sheet piece of paper that indicates you know there will be deductions. Many of which we dont know. But theres significant cuts that will of course generate potentially massive deficits, but also potentially a lot of growth. Thats where the debate is going to lie. Yeah. You know, guys, gary cohn on cbs this morning talked about that one page. And he said, look, we understand how hard it is to get things through congress. And were not going to box ourselves in with microdetails. But he tried to frame it in the larger context of taxing more dollars, jim, at a lower rate. Right . That does seem to be the starting point. Yeah, look, i think that Everyone Wants to be able to say this is a tax cut for the people who arent rich. I think they all want to try to make a case this is going to spur growth. I think the problem is were not done with health care. I dont think that there isnt a coordination with the house that makes me feel like you should be buying stocks because something good is about to happen. We have been in the earnings season where its incredible to see such fantastic numbers and no gdp growth. I think that they want gdp growth up. I dont know if they know how to do it. I think that the house is thinking that maybe gdp growth goes up if we somehow repealed obamacare. I think that cohn, mnuchin well hear from with david, they believe its tax reform. No one seems to be on the same page about what gets this economy back to say 2. 5, 3, that bernanke doesnt think is possible. Jim, youre there out west celebrating two years of our one market studio. Youre going to be there for a week where earnings from facebook and apple come in. A lot of chatter today about the levels of cash at those five enormous tech giants and what repatriation could mean. Thats going to be a big story this week. Yes. I mean, i think that this is where the growth is going to come from. I think people really underestimated what happened with alphabet last week. I thought that number was rather amazing. Its the first take on Autonomous Cars being mainstream. I think the people have to realize that the chip market is better. I do not want to associate what happened with intel. I think it was too down beat. Thats where the action is in terms of the hard assets. I think software is doing incredibly well here. I have to tell you if you thought about the idea that theyre only going to get to 2 here, i mean, these people are experiencing double digit growth according to every single line item. I cant believe how strong tech is and tech is selling in asia, in europe, in latin america. United states is good. But theres just a whole different attitude out here than there is on the rest of the country. Because this is where the growth is. And its youre going to see it with apple. More important youll see it with facebook. You see these stocks going up in the Early Morning hours now. Then they are going higher because last week amazon had such growth and alphabets growth which across the board was extraordinary. Yeah. Speaking of amazon, david, New York Times does a big piece this morning essential i will saying essentially saying am on is on the cusp amazon is on the cusp of changing on the apparel and the accessory side the entire retail model for the world. Its quite an amazing story. Right. Right. With the camera. I mean, you know these imbedded devices that are starting to proliferate in peoples homes, whether its alexa or the google product, there was discussion here yesterday about that. In a panel, in terms of their expectations that these are only going to grow exponentially. And what will you be able to do. I think youre referencing a story in which of course i believe amazon would be using a camera inside alexa to actually take your measurements so they can send you your clothing. Custom made. Hard to imagine in some ways but others, here we are, right . Yeah. And jim, thats one reason we Pay Attention to all these cash levels because doing that is going to be expensive for these big guys. These guys have so much money. I think that we can talk about how much repatriation, what they would do with their money. I think that the orientation here out here is other than apple they just want to spend because they are still in the scrum. They still want to be able to build the best data centers because they want to go to the cloud. They still want to be able to move out of the businesses theyre pigeon holed in, whether its alphabet, advertising. Whether its amazon or retail. Facebook and just advertising. They just have so much money they can really do what they want and obviously none of these companies is really regulated like the banks who have so much money. Theyre very, very circumscribed about what they can do with it. Thats why everyone is still optic out here. Quite a contrast. You feel energized when you get out here. Yeah. Yeah, you know carl, we have to go out there with him. I mean, we have to stop letting him go out there just to without us. I think he needs our company. Yeah. Because you know what hes doing, dont you . Hes quietly stealing all of the guests from this show, theyre going straight to the 6. Right. You nailed it. Its happening every time. Look at him. Look at how healthy he looks too. I look pale, you look fabulous. Hes always waking up at 4 00 in the morning, so hes happy out there. Jim, next time were with you. First of all, it was 2 30 out here. You know, you have to understand when you ask for that wakeup call, thats what time youre supposed to go to sleep. But i feel out here, the world is their oyster. I think its a little intimidating because the companies that are going at it want to destroy each other. But at the same time, theres so many people who havent moved to the cloud. There was a Conference Call last week that was one of the most blowout calls. No one paid attention to it. It was grubhub. And grubhub was about how people have stopped going out. They want pickup and delivery. Why . Because they want to be on facebook, they want to be on netflix, order clothes on amazon. Nobody wants to go out anymore. They want to play grand theft auto. Part of your long standing thesis, jim. Keep continuing to work every single day. I like going out. When we come back, murdoch versus sinclair in this potential bidding war for tribune. Later on the commerce secretary wilbur ross on renegotiating nafta, enhancing americas trade position. Look at the premarket. We talk about jack dorsey buying some more twitter shares and jim announcing the 118th draft pick for the eagles over the weekend. A lot more squawk on the street from post 9 in a minute. [pony neighing] what . Hey gary. Oh. Whats with the dogsized horse . Im crazy stressed trying to figure out this complex trade so i brought in my comfort pony, warren, to help me deal. Isnt that right warren . Well, you could get support from thinkorswims inapp chat. It lets you chat and share your screen directly with a live person right from the app, so you dont need a comfort pony. Oh, so what about my motivational meerkat . Inapp chat on thinkorswim. Only at td ameritrade. Its your glass of willpower that helps keep cravings. Far, far away. Feel less hungry with the natural fiber in clinically. Proven meta appetite control. From metamucil. Usaa gives me the and the security just like the marines did. The process through usaa is so effortless, that you feel like youre a part of the family. I love that i can pass the membership to my children. Were the williams family, and were usaa members for life. Sgho published reports say 21st century fox and black stone are teaming up in a bid to acquire Tribune Media setting up a bidding war with both sinclair broadcast and nexstar media. News today regarding twitter. According to the s. E. C. Filing, jack dorsey has added 574,000 more shares to his holdings and that brings it to 1 million shares. David, two media stories to keep you busy out there today. Yeah. You know, listen up, its interesting when you see a partnership between fox and the black stone of course. But it can make sense in terms of structure where you create a new one and you have the Station Group in there. And fox contributes its and they are therefore able to make the bid without having to part with any additional cash. These stations are valuable. They have been. They continue to be. And changes in the fcc ownership rules are allowing for this potential, guys. So well see. There has been some talk in the marketplace about this possibility. But you dont typically see the high kind of transactions. Well see if theyre successful in what has been sinclair what do you make of the dorsey purchases . I think i was talk going back and forth with the coo today. They have to deal with bloomberg talking about two quarters of twitter live experience and then doing well. I think that the quarter last week was good. I think people hate twitter so much that people just i think they nonwall streeters will continue to be surprised that dorsey is putting so much money in because he has a lot of stock. I think this announcement with bloomberg with our competitor does make a lot of sense in terms of what theyre doing which is trying to be a news source for everybody as opposed to the slag source that people trash you and try to get your response. I think this is a higher end advertising environment theyll be getting. Last year might be a trough quarter in terms of advertising. If they continue to do live video like this. Yeah. Live video including streaming some of the likes of some business competitors of ours, this new deal to stream Bloomberg Business news, thats going to feed the number of live hours that they put up a month. Look, i think that what they really want to be is a news source for worldwide. Look, i dont know if they can pull it off, but theyre teaming with people. They have gotten a very different kind of niche away from facebook and snap. Hes teasing what theyll do with the upfronts tonight. What i would say is this. They have something to tease. I mean, were so used to disappointment from them. We have insider buying. We have them doing some new stuff. We have them doing things that were unexpected. Which are all about making it so much its a more conducive environment to advertise. Thats where the money is. Thats what facebook is doing so well about. Thats why people are excited about snap. I think the stock this is the second time now we have good news. Last week the earnings. I dont know, the stock does seem cheap this they have some momentum. Well get some media this week. Time warner wednesday. Along with viacom thursday. Cbs thursday. Yeah. And well see. You know, viacom of the three you mentioned may be the most interesting given how much the stock reacted positively to the appointment of bob backes a while back now and each quarter of course sort of becomes more of a report card on his ability to turn that company around. Cbs, we expect fairly strong numbers and time warner is of course its an at t deal. The question for time warner is much more about the continued review of that transaction by the department of justice and what if anything at t is going to need to do in order to get it through as most people expect will be the case. But will there be some sort of Consent Decree associated with that . Yeah. Can i ask david a question about dish, carl, do we have a second . Yeah, go ahead. Dish reported numbers today. They missed. Theyre losing subscribers. But david, people still love it. Is it still just a charm stock or they have a master plan that jives with what john legere was talking about at tmobile. He praised dish as a good operation. If you lose subscribers, the stock keeps trading up. Im mystified. Will you explain it to me . I wish i could fully, of course, but i cant get into the mind of charlie urgen and decide what hell do if anything. Youre right, the core business is being depleted. He knows that which is why he has spent billions upon billions in buying spectrum on the overall belief that its going to have enormous value. He very may end up be right in that. How does he realize that value, by partnering with somebody to give him the capital he needs to that or by potentially selling the company or spinning the spectrum . But that seems to be where the market is focused. In a weird way, i think each time their underlying subscriber metrics come down from the old satellite business, it emboldens investors to believe hell act soon. As i reported, that was the big surprise how much dish spent in the broadcast spectrum auction but were still waiting, jim. I dont have answers for you, im sorry. All right. Well get cramers mad dash and count down to the opening bell in a couple of minutes. Kicking off the month of may, a split edition of squawk on the street continues in a moment. Hey. Pass please. Im here to fix the elevator. Nothings wrong with the elevator. Right. But you want to fix it. Right. So who sent you . New guy. What new guy . Watson. My analysis of sensor and Maintenance Data indicates elevator 3 will malfunction in 2 days. There you go. You still need a pass. With e trade you see things your way. You have access to the right information at the right moment. And when you filter out the noise, its easy to turn your vision into action. Its your trade. E trade. Start trading today at etrade. Com just about 6 1 2 minutes before the opening bell. Lets get cramers mad dash. Estee lauder reports on when and wells has some thoughts on it. Yeah. Theyre talking about the upside surprise, and that would be the first in a long time. This company has had some problems in asia. The ceo is the man who i think uniquely understands what technology has done in terms of trying to make people look good. This is all about the selfie generation. Thats one of the themes i have besides the stay at home. When you go outside, carl, you must be made up. You cant be spraying like me, because that is too hard. It takes another person to make you look good. But estee lauder you need their stuff before you go out. Its about highdef, this is highdef selfie. I have to tell you, carl, highdef can destroy your whole image if you do not have estee lauder cosmetics. Thats why i think the quarter is going to be great. Thats good. The cameras keep Getting Better which means you need to catch up. At the same time, jim, we did get income and spending. Spending not a surprise. Basically unchanged. Saving rate goes to 5. 9, the highest since august. You think this is immune to any consumer pressures . Yes, i do. Look, we want to see Interest Rates go up ahead of that wednesday fed meeting. We want to feel confident that the economy is doing better. I thought the bernanke interview was absolutely terrific. He said that yellen has toget in on the inflation and he walks that back. This wednesdays meeting no one is focused on that. The employment number, theres not enough attention. You need strong numbers and the fed to tip their hand that the numbers will be strong. Yeah. Consensus on friday is 185, at least for now. Well get the opening bell in just about five minutes. A lot more with jim and david in a moment. Predictable. The comfort in knowing where things are headed. Because as we live longer. And markets continue to rise and fall. Predictable is one thing you need in retirement to help protect what youve earned and ensure it lasts. Introducing brighthouse financial. A new company established by metlife to specialize in annuities life insurance. Talk to your advisor about a brighter financial future. The opening bell is brought to you by brighthouse financial. Established by metlife. Youre watching cnbc squawk on the street. Live from the Financial Capital of the world. The opening bell in just under two minutes. Welcome to may. And what a week its going to be to start things off. You have earnings continuing on the tech and the media front. A slew of macro data, a jobs number. The french elections on sunday and of course continued eye on washington. As it looks, jim, like theyre pretty confident they have the votes on health care and regardless, theres even chatter they might try to Keep Congress at work if they dont get what thing things done by the time this oneweek recess starts on thursday. Look, that would be great. I think were all kind of starting to feel is washington irrelevant . Does it matter that you have a president and congress being both republican. I think anything they do, if they get something done will be regarded as positive for the market. But right now, i think that there is skepticism that they can get whatever theyre going to be doing done. Sure, extra weeks would make it so there would be some sort of pressure. I do not want to look to congress. I want to look to earnings. I think apple is going to set the tone. Its going to be the most important Earnings Report of this season. What will be the most important questions for apple . Is it about Cash Management . Is it about the phone, is it the 8 . I think that theres a lot of questions about the super cycle. I think theyll dodge those questions. There will be a lot of questions about being able to do something with the Service Revenue. I think that theyll accelerate that. If we do some acquisitions they say, we might even make it so a bigger stream of earnings. Boy, that would be great. You know what you should do with apple stock . I think you should own it. I dont think you should trade it. Lets get to the opening bell, guys. And the s p at the bottom of your screen. At the big board today its china rapid finance, celebrating its ipo. One of the big five ipos we had on friday. At the nasdaq finance Services Firm btig celebrating its 15th charity day. Well keep our eye on a number of things. I know youre watching this barclays call on defense names which have been on an absolute tear. Going back to the election. Look, this is a call thats not dissimilar from what happened when reagan was elected president. There was a very big runup in defense because he was talking about a 600ship navy which never got done by the way. After the inauguration, there was a selloff. I think a lot of people felt the same thing would happen but it didnt. It turns out that the Defense Companies had unbelievable earnings led by general dynamics. I do not want to sell the stocks. I get the call, Lockheed Martin wasnt that great. Do not sell these stocks. Were talking about international orders, not the domestic market. So i think this call is ill advised. Well keep our eye on the defense names. Discover, jim, downgraded over at deutsche today and still from last week some people looking at chargeoffs at discover capital one. And sin kronty. Im trying to solve this. We had loan losses that were low and the credit cards know, i think that the Credit Card Companies are all under pressure with the exception of mastercard. Does not have any debt. Thats a service company. Visa had a really terrific quarter. American express which has loan issues did not report bad loan losses. Looks like the resurgence of those who are service oriented. I dont want to go against that downgrade. But i have to tell you, synchroty was smashed last week. People are critical of ge. I know david and i have talked about the ge quarter, but maybe getting rid of sin cronety wasnt a bad idea. You know the its not been particularly well timed. I think thats one of the criticisms thats been levelled at the company over these last quite a few years. Jim, you know, on friday, you and i did not really have an opportunity to discuss honeywell. I referenced it the stock is down this morning. I didnt get your sense as to what your expectations are with the review that its being undertaken by the company after the third point led by dan loeb sort of engaged them. And wants them to at least consider this idea of spinning off the Aerospace Unit in order to get a higher multiple on the Business Commercial business that at least they feel and perhaps others feel is the case. Do you think thats gotten any traction . Im so glad you brought this up. I think people are were glossing over what happened when dam check took over for cote and darius said you know what, im going to do my only thing. I told you, david, at the time, i found this quizzical. Because he get a great hand from cote. Remember the stock did twice what the s p did under cote. Obviously its favored industrial. But everything is on the table. It was actually a thoughtful time for loeb to get involved. Obviously it was not loeb lobbing bombs. It was loeb suggesting this thing is going to get a serious review. It is not like that management feels you know what, cote, he gave us what we have to do. And we got our marching orders. Look, if its going to bring the stock up, these guys are so focused on the stock. I with i went to hear them speak on dave cotes retirement day, they want to talk about how they get this stock up even more. Theyll do some serious study. Some other divisions that can be separated. When i look at dow and dupont theyre willing to separate anything when they get together. I would not overrule im not going to say this isnt going to happen. David, what an open minded company. If it works for shareholders it will get done. Yeah. Very interesting. I should point out, jim, speaking of people close to the process which will take place over months, they indicated listen, they wont do this for a quick multiple arbitrage. It has to be right for the long term value in terms of both the Shareholder Base of honeywell and whats left there. The commercial businesses and what would ever be the Shareholder Base of the new aerobase company. But youre right. Theyre taking a close look at it so it will be interesting to see how it involves. They did not seem to be on board with the idea that it could add 20 plus billion dollars to the Overall Company as mr. Loeb stated in his shareholder letter. But it is something certainly that they believe might at least to your point value and interestingly the new regime has begun, hasnt it . Cote is still there as i guess checksive chairman, right . But damcheck is running things. But cote, uniquely, we are seeing the ceos kind of hang on. Still be there. Remember also the retired ceos. Remember i think some people were a little kind of dazzled that Howard Schultz was on our show on friday. Hes executive chairman. I can tell you that cote really liked the idea of the connected car. The connected aircra he thought that there was very Good Technology working on the idea of connection side of things. That would be disrupted by splitting the two. But i love the fact that david cote i know he may be there in charge, but what hes saying is its your ship. He is not saying, listen, i left you a structure, how could you ever fool with it . Its the opposite. Everything is on the table. Hey, jim, the president has made a lot of interview comments in the last 72 hours. One of the things he said is an infrastructure bill is coming in two to three weeks. Were going to do infrastructure very quickly, we have the plan largely completed. Copper has seen a nice bounce, however, others arent seeing the same action. Well, a lot of infrastructure always comes when you look at it comes from china. I think i keep thinking back to the amazing interview we had with gary cohn two employment numbers ago where he talked about Public Private partnership and a gigantic bond offering that will fund this. That takes a long time to get through, but with Interest Rates so low, who knows how to do the Interest Rate curve than a guy from Goldman Sachs. To the previous administration, they didnt want to fool around with the curve. Yeah. He talked this morning and in morning show interviews coming from a Team Oriented environment at goldman, thats sort of been replicated at the white house. Thats helping them sort of arrange a collision of opinions and ideas and debates that were part of the goldman culture as well. David, before we go to pisani, raise the curtain on milk today and talk about what you think you want to ask people and hear about. Well, well have David Solomon join us who is from Goldman Sachs at the top, more or less at the top of the next hour. Remember, hes now the cohead of sorry, president and chief operating officer having moved up when the aforementioned mr. Cohn moved out into government. We want to talk to mr. Solomon about that quarter at goldman. Theres greg maffei. Talking to him as well, about im sure he wants to talk about formula one and talk to him about some deal making and the. Possibility of that. And the potential transactions. Those are a couple, not to mention the treasury secretary. Got a few questions for him as well. David, when you talk to maffei, can you ask him about sirius satellite . There was a time that i thought apple could go for that revenue stream. I know they dont care about the technology for the satellite system, but that stock is uniquely been doing very well without anything happening. I would love to know their opinion about the long term given the fact that autos seem to be peaking. Okay. Its a fair point. Although the response to the last quarter was not particularly strong, was its, jim . I know your audience on mad money has particular interest in this name which is one reason you know it pretty well. How did you see this last quarter . I agree with those Morgan Stanley downgrade. I agree it was tepid. I think that its kind of old. Its gotten old. They need to refresh. I mean, those of us who love it in the car, terrific. But remember, youre always going up against your apple cell phone that goes right into your car. Do you need satellite radio when you have all of the tunes and i think obviously you need howard stern if you love howard stern. But i do think that the apple in the car and ultimately we could get to see much more apple as part of the car is supplanting. They have to do something. I dont know what, but maffei is a genius. Ill try to help you with that, jim. No promises but well see. Up that. Guys, theres some good trading in tech. Apple up to 145. Facebook is up past 151. Dow is up 3. Lets get to bob pisani on the floor. Good morning. Happy monday. Modest moves up, but remember thats enough to get us over the edge here. 2395. Lets look at the s p, remember thats the old closing high, we have it up against the door last week. Not quite right, but a lot of talk about sell in may, go away. Its more complicated than that. If you want more on that, i go into the machinations of the sell in may phenomenon. May has been up in the last five years so careful about that. Good part of the world is closed for mayday. So not a lot going on overseas. The sectors here in the u. S. , the financials leading once again. Tech stocks, consumer discretionary. Theres the reflation trade. Energy cant get moving here. Back below 50 on oil again. Gold which has been fading in the last couple of weeks to the downside. Ill show you interesting stats on gold flows and etfs in a moment. Were hitting the 60 mark in the s p 500 earnings so later in this week well shift away from earnings to q2 Economic News. Remember, q1 wasnt that good. We have to get some good numbers starting today of course we have the april ism and will the q2 Economic News pick up a little bit . The bulls are insisting that it will. Thats going to power the market. Well see about that. The fomc on wednesday. No chance of any rate hikes here, but the question is will they keep june on the table . How do they address the soft Economic Data in the First Quarter is the big issue right now. Lets move on, talk about fund flows. We had wonderful numbers in april. Remember we have been getting about 40 billion a month. Very consistent all this year. 42 billion in the etfs in april. We can do 500 billion. The money in the etfs has been going in steadily this year. We have seen the plain vanilla s p 500 stuff. Thats very big. And emerging markets very, very broad inflows. Not one thing in particular. You want to look at one etf getting big inflows the eurozone. Ezu. Anything with europe is doing nicely. They increased their assets by 10 . Look at ezu in the last few months here. Primarily i think on elections in france, that was doing very well. So ezu the full put up the chart for ezu, you can see whats going on there. Thats had huge inflows as well. We have seen theres your ezu, look at the move up on the french elections there. We have seen outflows from gold stocks. Gold miners a very, very popular trade, gdx, lost 10 of the assesse ass assets. They tend to follow the prices but thats going on there. They saw about 10 of the outflows. Ipos, another busy week. We had seven last week. Well see some interesting ones in the energy space. Terra midstream, nearly 900 million deal, theyre big in the marcellus and utica shale. We have big deals coming fairly soon. Look at the next one. Thats the Liberty Oil Field services. They do fracking services. Primary in the permian. Theyre going thursday. Theres a raft of these Energy Companies because nothing has gone public for a year and a half. So if the markets open and if theres any kind of door for them to get in, theyll start to move on that. Meantime, the ipo market, those stocks that have gone public in the last few months are doing really well. Theres a simple way to look at. The renaissance ipo, it goes back to to the end of 2016. Bottom line here is thats moved up rather aggressively in last few weeks. Its up 15 year to date. More than double the s p 500. So thats one of the reasons were starting to see the ipo market open up. The afterperformance of those that have already gone public is doing exceptionally well this year. Right now the dow up 3. 5 points. Thank you, bob pisani. Bernanke already on the air this morning. Lets get to santelli. Hey, rick. Good morning, carl. Very interesting with ben bernanke. I enjoyed the part about how Balance Sheets of Central Banks around the world, how they fit into a representation comparison of gdp. We had just done a piece on this. Ours is about 25 . Size of Balance Sheet to this total size of the economy. If you look at japan its 100 . Maybe a systemically important designation needs to be on other Central Banks. A couple of things should jump out at you. We reference that 2. 27 yield support. You can clearly see we continue to hold it. If you look at how narrow it is today, europe is closed. Pretty consolidated. Rates really didnt pay a whole lot of attention to the moderation of pricing pressures embedded in todays personal income and spending report as represented by the personal consumption expenditure. Lets hold the following charts to an october 1st of 2016 start date. Were going to look at something quite simple. Since november you seen our ten years. Were not at the 2. 65 close area, but were at the beginning of the november yield when we moved higher along with higher equities. If you look at the hyg etf its surpassed some of the pricing around the november election. But heres two etfs who have not. The Investment Grade and the munies. Investors seem to concentrate on liking that hyg. They seem to be more gravitating towards i can accept risk mode. That speaks volumes especially at this point in time in financial history. Especially we want to watch that after the french elections this weekend. Lets turn to foreign exchange. Since mayday has affected many closures around the world, lets look at the dollar index on the one week chart. Were hovering and holding at kind of the 99 area. Thats really important. If you go back to october of 2016 on the left side of your chart, theres that little top there. That top is basically around 9890 from the 27 of october. We are somewhat holding that old top. I know its not a huge support level but traders say theyre paying attention and that this is a rather significant area. Carl, david, jim, back to you. Rick, thank you very much. Rick santelli. When we come back well show you jims magic moment at the nfl draft over the weekend. Pretty muted start to the week. The dows down two points but some record highs for the likes of facebook reporting this week. Were back in a moment. Business was stagnant. We didnt have the daily insights we needed. So nothing was moving. [ horn honks ] then the experts at cdw worked with us to orchestrate an Intel Powered infrastructure optimized for advanced data analytics. [ horns honking ] now we have the answers we need to make informed decisions. Moving more product then ever before. I forgot my keys. Expedited insights by intel. It orchestration. [ horn honks ] by cdw. When this bell rings. It starts a chain reaction. Thats heard throughout the connected business world. At t Network Security helps protect business, from the largest Financial Markets to the smallest transactions, by sensing cyberattacks in near real time and automatically deploying countermeasures. Keeping the world of business connected and protected. Thats the power of and. Thithis is the new new york. E . Think again. We are building new airports all across the state. New roads and bridges. New mass transit. New business friendly environment. New lower taxes. And new University Partnerships to grow the businesses of tomorrow today. Learn more at esd. Ny. Gov lets[ whimpers ] dog. Find pingpong. Find your awesome with the xfinity x1 voice remote. Thats amazing the Philadelphia Eagles select mack hollins, wide receiver, north carolina. Thank you. Thats a great pick. That was jim on saturday announcing the Philadelphia Eagles fourth round pick in the nfl draft, selecting as you heard mack hollins from north carolina. Jim, what was that moment like . This was actually the most nervous i have been. A lot of guys brian dawkins, legendary eagle, they were behind the curtain. They were saying youve got to stop, you dont have to be so nervous. Then i led people in fly eagles fly, i thought i was off key. I was in the room after, mr. Lurie, the nfl, you hear that nfl is peak, but it didnt feel that way in philadelphia. Lets listen to you leading the charge. This is jim and the crowd singing fly eagles fly. Fly eagles fly, on the road to victory fly eagles fly, score a touchdown one, two three hit them low, hit them high and watch our eagles fly fly eagles fly, on the road to victory eagles david, i dont know about you, but the league is getting pretty savvy when they can leverage cramers fame on draft day. Yeah. Although i never want to hear him sing again, carl. That was just horrible. [ laughter ] oh, my god. Im sorry. It was. You know it was. But otherwise okay, jim. He gets to do the fun things. We never get to do, carl. Someone never asks me to throw out the first pitch or nothing. I threw a first pitch. I know your boy is a pitcher, but he should get some when lessons from me. Congratulations, that was fun to watch. Well get stop trading with jim in a moment. The dow is down two points. Can i get some help. Watch his head. Im so happy. Whatever they went through, they went through together. Welcome guys. Life well planned. See what a Raymond James Financial Advisor can do for you. Weve done well in life, with help from our advisor, we made it through many market swings. Sure we could travel, take it easy. But weve never been the type to just sit back. Not when weve got so much more to give when you have the right Financial Advisor, life can be brilliant. Ameriprise time for cramer and stop trading. I had a survey this morning from ubs saying that apple cell phone buying is at a low. I dont think people will care. People will overlook it because of the cash position. If theres a super cycle for the 8, things should be pausing right here. Im not concerned about it. I care about the Service Revenue stream. Im not hearing anything other than good things other than the ecosystem. Even though near term demand may be soft, maybe we shouldnt care. I think thats the correct attitude. I think that i dont think that by the way tim cooks going to talk at all about what that ill do with the cash because we dont know what president wants in terms of how quickly they can get through the congress. But i think any talk about the revenue stream being greater than a fortune 100 company which has been the party line would make this stock move up because people would pay more for the earnings if its more Service Revenue stream. Yeah. Now we have apple at another record high this morning, jim. Along with facebook. Would you prefer to see some more skepticism before the print or does it not matter this week . No, it does. Particularly for facebook. One of the things about facebook theres always there are a lot of different line items. Theres a line item that people freak out about, whether it be the spend line item or whether they say, listen, we cant put more ads in because it will junk up the viewer experience. Theres usually a window open so insiders can sell. So i wish facebook were down ahead. Thats the one bothering me tremendously that it keeps running. Jim. Whats on mad tonight . You cant come out here without starting with marc benioff. And then fort net, one of the areas that people are spending a fortune on is cyber security. When you move to the cloud you better have it right. So well talk about a lot of things with benioff by the way including the idea of wheres the president in tech . First 100 days i thought they were supposed to be at war. I think its war and peace. Benioff will tell us. Thats going to be one conversation to listen to, jim. We cant wait for thank you. We cant wait for your coverage tonight and throughout the week. Jim at one market this morning in san francisco. When we come back, david will talk to David Solomon and greg maffei. Then later, wilbur ross. The dow is up two points but tech really leading the charge on this monday. On this monday. After becoming one of the largest Broadband Companies in the country. After expanding our Fiber Network coast to coast. These are the places we call home. We are centurylink. We believe in the power of the digital world. The power to connect. And thats what drives us everyday. With e trade you see things your way. You have access to the right information at the right moment. And when you filter out the noise, its easy to turn your vision into action. Its your trade. E trade. Good monday morning. Welcome back to squawk on the street. Im Carl Quintanilla with sara eisen, post 9 at the new york stock exchange. David faber is with us from the institute in los angeles where hell sit down with David Solomon. First up, muted start to the markets but a big week to kick off the market of day as we get earnings. A lot of macro data, a jobs number and a big eye on washington, d. C. Some big interviews thats where our road maps begins this morning with commerce secretary wilbur ross. Hell join us from l. A. First, his thoughts on north korea, trade with china and the future of nafta. Then its first trading day of the month, april saw the nasdaq hit 6,000. The dow reached record territory and the s p topped all time highs. What to expect in may. Will we see a new bid for Tribune Media . What that means for Rupert Murdochs empire and how regulation under the Trump Administration will affect the media consolidation. But first out to david faber in los angeles. Hey, carl, thats right. Were ready to get started with the interviews from the milkin conference, of course. Im joined by David Solomon, the president and cochief operating officer of Goldman Sachs. A relatively new role for you, but given your new role, better for you to answer some questions that investors have about the quarter that Goldman Sachs put up. Giving that it wasnt given that it wasnt a good quarter in relation to some of your peers. We see goldman lead in in ways. But in this case it seemed to follow. What can you tell people in terms of the business mix at Goldman Sachs as to if this is a one time issue dealing with of course commodity and currencies in particular or something that is going to take a little while more to fix . Well, first of all, good morning. Thanks for having me. Im happy to be back at milkin with you. Look, this was quarter that we didnt meet expectations. Some of our businesses, investment banking, equities business performed in line with expectations, better than expectations but we didnt meet the expectations. When Something Like that happens we take a hard look. We look at the Business Activity during the quarter. To try to figure out, you know, what went slightly different ways. We have a different client mix, we have been working hard on the market share with Asset Managers and we stepped back and we looked at the overall franchise. We have a great franchise on fixed income. We have got great client relationships. Great market share with our clients. This quarter we disappointed. Creates an opportunity to take a sharp look and say, what at the margin can we do to make sure were performing for our clients. You said youre weighted to hedge funds and thats a concern, given the fact that hedge funds are at not creating as much flow or volatility out there. Perhaps you dont have as much from the corporate side. Is that a concern for you . Do you need to change the mix and not rely so much on hedge funds . If you look at the day thats available, the consultancy data, the market share with all of the different client constituencies has increased. However, we have a leading position with hedge funds. So when that sector is in a tough market environment or that sector is changing that can at the margin affect us. Really what i would say, we have been focused on making sure we have the broadest, full Service Platform for all of our clients. Were very committed to that. We do weight in certain businesses than some of the competitors do. But that said, when i look at the overall mix of the client relationships and way were positioned in the business i cant comment on others earnings. But i look at the franchise, i feel very good about where our teams competitively positioned and our ability to serve our clients in the franchise. When you look at the Hedge Fund Business overall is there any concern it may be in a seminal decline, fees are obviously compressed. More and more investors seem to be moving to passive strategies even amongst the endowments and the institutions who would typically invest in hedge funds. No question that the hedge fund space, especially the larger more well established hedge fund space its a tough space. Its certainly evolving. That said these things run in circles. I wouldnt say that the hedge funds are going away by any stretch. We are seeing some new hedge fund formation. Smaller funds, new investors. You know, starting to create new businesses. So look theres been a big movement from active to passive. Theres no question the variety of reasons that with we talk about that that movement continues. But at the same point they have ebb and they ebb and flow. Its a tougher time to manage activity and being a Hedge Fund Manager and we have discussed a variety of reasons thats the case. Its a trend that continues at this point. Lets move on sort of the macro picture. You have travelled the world obviously. I think youre recently in london, asia as well. There does seem to be a sense amongst the Investor Base here that things are Getting Better there. That europe is better. That china versus a year ago is much better. What did you see on the ground . So its interesting. I have been over to asia and to europe. You know, i was just in europe two weeks ago, three weeks ago. I spent a halfful of times handful of times with corporate and investing clients and when you sit with the corporates and listen to them talk about their business, theres definitely a sense that growth there is performing better than people expected. Now, theres certainly a lot going on politically. I think you know were moving through a bunch of that. But just in terms of you want to make a bet on the french elections . Im not going to bet on elections. Im finding that all the pontificators about elections thats not been a good sport to be involved in. No question the process about the dutch elections more moving in the more pro euro direction and hopefully this is moving in a direction to make it stable for markets. But the underlying Economic Activity is pretty good. When you shift over to china, the chinese have a big incentive at the moment as they look toward the Party Congress in the fall to really retain stability. And when you and i sat and talked a year ago, we had a much different view, much more cautious view about what was going on in china. But if you sit here today the economy is performing pretty well. When i talked to big global ceos that are selling into the market they say they see increased or stronger consumer demand. So that feels better. I would say the real incentives there, despite the risks that exist over in that market. For that economy to continue to chug along pretty well. So you put that all together with whats going on here, and theres no question growth feels a little bit better and thats translating to some degree through the markets. There seems to be more activity overall. Im curious about here in this country. There was a great deal of euphoria after the election, at least among some people who run corporations in the belief that tax reform is going to happen. Well get a lot of dereg which is happening. But that seems to be tempered exit. Here we are at 100 days, a little over that. Is that uncertainty creeping in in terms of the Decision Making or is it all good to go ahead . Well, its theres a lot out there from the potential policy perspective. As we got past the election, there was a lot of conviction about this will move forward. It would be good for market activity. I think as we have gotten into the First Quarter, and the process of actually creating legislation and moving a bunch of this forward complicated stuff. So i think that people are more cautious about what it whats realistic that can get done, what is the time frame under question it can get done and people have to watch this very quickly. So i would say some of the conviction that existed after the election in the Fourth Quarter some of that conviction has faded here. But look, earnings have been pretty good. Its been weighted to financials, industrials, the big tech. We have a bunch of energy, consumer. Reits. You know, that kind of stuff to go. But so far, so good. Theres some very, very constructive policy discussion going on. And i think investors are willing to hang in there and watch this. But they have to watch very carefully. If it seems like the legislative agenda cant move forward in a constructive way it will affect the way that investors are feeling. Do you expect the market activity will pick up . You might have asked that in your old days sure. Capital markets activity has been very good in the u. S. In particular. Now remember, were coming off of a very, very slow you know, First Quarter last year with a terrible First Quarter. Ipos. But Leveraged Finance active if i is up significantly. Particularly with floating rate instruments and senior loans. I think thats up 250 , but even bond activity is up. When you look at that market were operating at close to two year tights so that market feels like its operating pretty well. Equity activity, underwriting activity, ipo activity has picked up. I think you can understand that between election cycle thats running in europe thats slowing that activity down. But equity activity is up meaningfully. M a is up nearly 20 . 18 year over year. Thats still not the rate that we saw in 2015. 15 was an incredible year. Finally let me end on that note though. We dont know where things are going on tax reform but there does seem to be a general consensus well get a repatriation deal at some point. What does that do . I mean, i would assume thats real positive for your business conceivably if all of that cash is returned and has to be put to work in some manner. I think its a positive for the markets and i think its a positive for the economy here in the u. S. A bunch of that capital is going to get returned. A bunch of that capital will be invested in the different context. Our business obviously benefits when that activity is created. It would be a very, very constructive thing, but its something we have to watch and see how things develop. Exactly, so many things to watch. Well, for now well leave it there, david. Appreciate it. Good to see you, david. Good to see you, david s solom solomon, chief operating of Goldman Sachs. The tech is outperforming again, the dow is negative, s p is positive. Lets bring in mike santoli on the set here out with his new column on overblown investor worries. This is a notably bullish mike santoli. Were trying to refute some of the popular, bearish lines of concern. Im not averse to finding new worries about the market but i think there are a few areas that basically are getting too much play in this regard. Now, ill tick them off quickly. The flattish yield curve is evidence that theres an argument going on between the treasury market and the stock market, the treasury market being more down beat. But in reality this is a typical pattern of other fed tightening cycles. You have the long term rates not going up as much or tightening up. I feel like were nowhere near flatness of this yield curve to where youre saying this is a dangerous signal coming from the treasury market. Especially when i look at the Corporate Bond market. It remains quite strong. Theres no argument between corporate debt and equities. You can say watch it, but dont worry about it right now. The cbo, vix, its below 11 right now. Somehow people are too come place i want, investors are not appreciating the risk. But the vix its even higher than the market has been displaying. So essentially it reflects that we have been in a calm and steady environment. Another real heavy one, that we have been hearing about is this hyper concentration or perceived concentration of the market in the mega cap tech stocks. Yes, they have delivered an outsized percentage of the gains for the market as you talk about the big five nasdaq stocks but not an unusual level of concentration for the overall market. I would be much more worried about this if they were performing the exclusion of Everything Else in the market. Equal weighted indexes are doing fine and the breadth of the market looks relatively healthy. Not as if in 2015 a handful of stocks are working and Everything Else in trouble. We have a miss on the construction spending, a miss on spending, a miss on ism, auto sales, core cpi. Incomes. When did these matter . They matter a lot, but the markets have absorbed that. Thats why youre seeing the big Growth Stocks take the lead as opposed to the cyclical stocks. Look, if this is not the first four month phenomenon where we have to worry about a true decline in economic trajectory, i think well be worried about that. The other thing to keep in mind thats off the radar, if the Consumer Credit situation deteriorates further, you know, a lot of the stuff were working with right now seems late cycle. Consumer credit is one of them. Also wage growth and the margin squeeze, is everyone else going the way of United Airlines and tyson foods. All of this stuff matters. I think its the handful of things none of them seem as if theyre kind of the Silver Bullet in this bull market. But the earnings are rising above the Economic Data, Political Data and really carrying the weight here. The question i guess is if earnings expectations continue to ramp higher, how much can they do that if Economic Expectations dont rebound from what was a weak quarter . Were in an interesting part of the cycle because we had an earnings recession without an economics recession. Were having the earnings rebound without necessarily having the overall macro economy. The Global Economy is in a decent spot right here. So 3 Global Growth and nominal growth higher on top of that. It can commit that firming profit picture. Were certainly going to watch reaction to todays data. When we come back, more good guests from the milkin conference. Greg maffei will join david faber in los angeles and then wilbur ross will join us in the first on cnbc interview you do not want to miss. The dow is down 21. Back in a moment. A moment. Ictab. The comfort in knowing where things are headed. Because as we live longer. And markets continue to rise and fall. 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Liberty stands with you™ Liberty Mutual insurance. The dow is down 13 points. Lets send it out to Steve Liesman who has more on a squawk box interview this morning with ben bernanke. We were waiting for this one. What surprised you the most . Well, you know, the former fed chair out with the paperback edition of the courage to act he expressed his doubt that President Trump can hit and sustain a 3 gdp growth target. On a sustained basis, its certainly possible but probably not that likely. I think if theres a big tax cut for example that lowers tax rates, you might have a bump because of the increased demand. Increased consumer spending. That gets you over 3 . Um, probably not. I would take the under on that. To be sure, bernanke agreed that its useful to try some of the things that the president wants to do like spur Business Investment and make the tax system more efficient and the government should aim to produce productivity and hes upbeat about the fact that they can ease from the monetary policy. Saying that critics have been wrong in the past. So long, so good. It wasnt too long ago that people on shows like this were saying wed have hyperinflation, huge stock market bubbles but in fact its gone pretty smoothly. The fed is on a process of exiting from easing money. The economy is doing pretty well. The Unemployment Rate is 4. 5 and the inflation is close to the fed target. All things are on track. Bernanke doesnt think they have to slash the 4. 4 billion Balance Sheet. He thinks the fed may choose to run the bigger Balance Sheet in the future saying 2. 2 to 2. 8 trillion is a mark worth aiming for, sara. My favorite bernanke is when he pushes back against the critics especially during the financial crisis. He said wed create hyperinflation, all the critics, he feels like he has to say they were wrong. And we were right. Yeah. Its something he comes back to a lot. I think hes a little bit sore from that. I think hes also you know, the title of the book is courage to act. Its well worth remembering that some of the things that he did had not been done by any central bank around the world ever. These are extraordinary actions. He did against the tide. I think hes waiting for guys to say you know what, this was the right call here. More or less. And i think he might be waiting a very long time for those critics to step forward though. Yeah. Steve, thank you. Great interview. I know well hear a lot more snippets throughout the day here on cnbc. When we come back, commerce secretary wilbur ross will have the latest on north korea, u. S. Trade deals with china and then next, liberty ceo greg maffei will join david at the milken conference in los angeles. More squawk next. Squawk next. Lets go, shes a dog. [ whimpers ] find pingpong. Okay, lets go. Find your awesome with the xfinity x1 voice remote. Thats amazing welcome back to squawk on the street. Im david faber at the milken conference. Our guest right now, greg maffei. Hes the president and ceo of the Liberty Media corporation. I havent seen you since november. Thank you. Thank you for having me, david. Im sorry youre not get on the line. Thats to listen to the treasury secretary. Im trying to get a friend to save me a seat. Well take care of you, dont worry. You may have as much going on as he does, or even more. All right, i want to start off with a question that people have about charter and what libertys view is of that position. These are the particular comments that mcadam made a couple of weeks ago. It seemed to indicate a desire on the part of horizon perhaps at least to explore something or having explored something. Is there a chance that verizon would buy charter and or that liberty would be interested in having a discussion about that . Well, i cant speculate on that, but i mean, lowell has made comments about willingness and desire and i think he calls it industrial logic including charter. We at liberty remain the largest shareholder, very bullish on charter. What tom and he team are doing its pretty impressive so were very happy. Of course well always look at alternatives but charter is a great asset, great company, great direction. I mean, mcadam had made the point that the architecture doesnt line up that favorably in terms of their rollout of 5g or being able to accelerate that. Some wonder if a valuation that you would be willing to accept would actually meet. Theres a problem in the sense that our expectations are pretty bullish on charter. Why . Oh, i think you have got a lot of runway left between the synergies on the time warner deal. Opportunity to upgrade to all digital on the existing time warner network. The opportunity to grow video subs again. Opportunity to drive the subscribers from basic to expanded basic. All the things that tom and his team has done on legacy charter that we think they can do on the time Warner Brighthouse footprint. Which leads you to the belief in a price thats anything above a willing acquirer to pay . I didnt say that. Im asking. I can understand. What i said, were pretty bullish on charter and where its going and so our expectations are high. Understood. Understood. You know, its funny because a few years ago there was a sense that cord cutting would result in fewer subscriptions and therefore lower cash flow for the very providers. It hasnt happened. Broadband is the key product and it keeps growing. Well, you have seen cord cutting take away 5 million households on from video products. And you have seen broadband only households grow to 15 million households so thats more than offset the decline. And broadband is a great product. Americans people around the world, appreciate the data and the speed that we can offer on the cable plan is excellent so its a great fit. Do you think the Regulatory Regime is such and permissive such under the Trump Administration you can see a Comcast Charter deal. My chairman likes to speculate on that. He likes to speculate. Also about disney and apple. I have to sweep up afterwards. I know you do. And of course you have to move the conversation towards formula one. Dont you . Which is the key asset for you. It was a large deal, not done that long ago. Yeah. Chase cary is in there now running it. Do you continue to see the same opportunity you did when you first announced the deal . We have been very pleased effectively we agreed to buy that at 21, its trading at 35. Flunk, formula one ks, and i think thats a reflection that its a global asset thats nearly unique in terms of your ability to get you cant buy the olympics or fifa. Formula one has as much global reach as any sport out there and were very bullish on it. Chase and his team, theyre doing a great job. Pandora, i have to ask you about pandora. Sure. Do you buy it at 10 bucks, 11 . 11. 50 . I think its a company with great reach that hasnt monetized as well as it might. But there are a lot of challenges. Its a tough space in subscription streaming. Up against amazon, google, guys with big resources who get paid other ways. But its not without the challenges. So thats pluses and minuses in everything. I asked that of course because you control sirius. Thats where the opportunity is. You have been consistent on pandora in terms of your view on it. They right now i believe are in the market to raise private investment, 200 million bucks. Is that something that liberty or sirius would have any interest in investing in . I dont think theyll take our money. Why not . You have to ask them that. Were sort of the alternative not being as bullish on the that subscription side. That is being invested in the subscription. Hsn and qvc. Something we dont ask that often about. You completely controlled qvc of course and you you have a control position at hsn. 38 . 38 . Negative control as john would say. Negative control as john would say. Is there an opportunity there to put the two together . Well, look, we have always thought there might be interest in that. The challenge has been historically that even though it has better growth because of the domestic hsn, qvc has traded at the multiple discount and bigger Free Cash Flow discount. So our general view has been investing our own stock repurchasing the own stock is more attractive than buying hsn at a premium. Even with synergies. You know, thats been our challenge. Right. Finally, sirius, which of course is another very large asset for Liberty Media. The last quarter was not particularly well responded to by investors. There seemed to be some concern in terms of the used cash market, the new car market, the overall growth in sar and the continued competition from the likes of your phone in the car. Is that a concern for you . You always look out at risks in the business and we have a very strong position in the car so both the new car market and the used car market are important to us. As mobile phones get easier to connect, you fear that our edge, our moat in that declines. But i think we have a lot of other things including a great brand. Great differentiated content, things like cnbc, you cant get on spotify. That helped to build a Loyal Customer base with sirius. Is that enough to sustain growth into the future though . Clearly its helped to create what is a successful company. 31. 5 million subs. We continue to grow. Well grow again this year. Im very optimistic still on sirius prospects. No talk about trying to deal with that gap again in the underlying value of sirius versus the as you say, we have a tracking stock, liberty. Liberty sirius which trades at a discount to sirius. You know, we have noticed it, we have talked about it. We had one of those over at liberty eventures another one of our ventures another one of our companies. At some point in the future, i suspect well fix the problems at Liberty Sirius and sirius too. Im not sure we made progress here, but i enjoyed having you nonetheless. Were here in l. A. It is really nice. We didnt get to talk about the braves. And the new stadium. New stadium is great. I was there at the opening at suntrust a few weeks back. It was great. Greg maffei, thank you. President and ceo of Liberty Media. Back to you, carl. All right, thank you very much, david faber. As we go to break, look at the markets. The dow is down some 11 points although we have some record highs going on in tech. When we come back, the u. S. Commerce secretary wilbur ross will join us in a first on cnbc interview. Well talk some trade. North korea and more. So stay with us. Its a very simple procedure, mr. Diaz. Were just going to make one small incision here, then were gonna go in and remove your 67 corvette. My vette . Its just a gall bladder you dont have. Aflac paying you cash, so you might have to sell that sweet little muscle machine just to cover your rent. More funny juice. But my papa gave me. That. Car. What do you wish you had . Aflac. Ohh, i love doing that. Health can change, but the life you love doesnt have to. Keep your lifestyle healthy with aflac good morning, everybody. Im sue herera. Heres your news update this hour. The house and the senate plan to vote as early as wednesday on a new 1 trillion spending bill to keep the government running through the end of september. Compromises were made by both republicans and democrats as they came to the agreement late sunday. There will be no money to build a wall. North korea suggesting it will continue the Nuclear Weapons test. The country has carried out five Nuclear Tests in defiance of u. N. Resolutions. Spacex launching a top secret Spy Satellite for the u. S. Government this morning. After the launch was scrubbed on sunday. No details divulged. Instead, they focused the webcast on the successful booster landing. An ohio family hosted facebook ceo mark zuckerberg. He dined with the moore family in newton falls after asking his staff to find democrats who voted for trump in the election. Youre up to date. Thats the news update. Carl, no word on what they served but looked like they had a good time. Thank you very much, sue herera. Lets get to some politics this morning. The white house hoping for a week of wins with a potential new vote on an obamacare repeal, and a Government Shutdown averted. The president said hes open to renegotiating nafta and explaining why a strong trade deal with china is less important now than during the campaign. Take a listen. North korea may be more important than trade. Trade is very important. But massive warfare with potentially millions of people being killed, that as we would say trumps trade. If china can help us with north korea and can solve that problem, thats worth making not as good of a trade deal for the united states. Lets get back out to los angeles. Joining us this morning the commerce secretary of the united states, wilbur ross. Mr. Secretary, great to have you back. Good morning. Good to be back on. It sounds like the president at least in his words came awfully close to withdrawing last week. Although theres been conflicting reports about whether he was backed off by the leaders of mexico and canada or his own staff and aides. Whats the answer to that . Well, i think what people dont understand is the president encourages lively discussion within the white house and between the white house and the cabinet. In the course of those discussions, all kinds of alternatives come up. And i think whats unfortunate is someone leaked one of the many potential papers that was floating around and created a whole skirmish over something that had not been decided upon by the president. So where we are is his position is he will renegotiate nafta. We had already notified the congress of that some months ago and now were waiting on the technicality called the 90 day letter so that we can begin the process in a more formal way. Congress has to give us that authority. Yes. What was your recommendation . To be more aggressive or to follow the path were currently on . I dont think its useful to discuss the ins and outs of private discussions with the president. I very much support the position he is taking and i think it is the correct position going forward. Now, what he did say is that if at the end of the day we cant renegotiate the deal properly then hell have to think of other alternatives. Secretary ross, everything is being measured in the 100 day mark. Now that weve crossed that threshold on saturday, when it comes to trade policy there is an argument that the president has certainly been behind on his 100 day campaign promises. Not labelling china a currency manipulator, not starting to renegotiate nafta. There have been no bilateral trade agreements as were promised. How would you rate the trade policy . Well, first of all, the reason that we havent had the formal negotiations on nafta is very simply that congress has prevented us from doing so. So its very hard to blame the president for something outside of his control. But what we have done in terms of trade is quite a lot of things. We have brought quite a few more trade cases than had been before. We levied 1 billion fine on canada for dumping soft wood. We levied on the export side a billion 195 fine on xte, the second largest China Telecom company for violating the sanctions against north korea and iran. And we have done a million other things in the way of other trade thats fair. We have begun we have begun selfinitiating cases. Not making the industry wait till they get themselves organized but saving a lot of time by filing them ourselves. So its really quite wrong to say theres been nothing done on trade. That is fair. My question on that, mr. Secretary, is how involved is Peter Navarro as the president s trade adviser . Do you guys Work Together on some of these Enforcement Actions . Is he working on Bigger Picture trade negotiations, can you talk about his role . I know peter very well from the campaign. He and i did perhaps a dozen or other editorials together on trade policy on various other parts of the president s economic plan. Peter is on white house staff which means hes into the policy side and into coordination between the white house and the department of commerce. He is not a trade negotiator. Thats not his function. Nor is it his desire. We have the statutory responsibilities of the u. S. Trade representative and then you have the collaborative role that the president has designated for me to play. So were cooperating as a kind of a triumvirate. Navarro seems so focused on the trade deficit. Many other economists believe that that focus is ill advised, that it is not a particularly accurate barometer of the Economic Health of our country. Well, navorro is an economist. He has his opinions and as i say, the white house encourages diversity of opinion. Because thats the way you make sure that you vet all of the sides of the individual question. But peter is spending a lot of time for example on the buy america hire america. That was one of the one very explicit sections in the executive order that the president issued when we were all in harrisburg saturday this past weekend. Well, speaking of buy america hire america, when you say youre going to renegotiate nafta which is what you said at the outset here, tell us what actually you see coming. Give us some sort of sense as to what that actually means and how long that may take. Well, first of all, nafta is an ancient treaty. Its decades old. Neither our economy nor the mexican nor the canadian economies are remotely similar to what they were back when the deal was done. Theres nothing in it really about the digital economy. Theres relatively little in it about the service economy. And in the sections that it does address some of those are also clearly obsolete. They have a section called country of origin, rules of origin. Permitting components to come into nafta duty free. Well, many of the parts that would describe that were described in the nafta agreement arent even used in cars anymore. So its sorely in need of revisitation. Its enforcement provisions are pretty weak and the dispute resolution mechanism. It shouldnt surprise you it needs changed. You have a document decades old. The idea they got everything right for it seems to be a desire on the part of the canadas and the mexicans to move at a dispatch. I dont know what time line would be for Something Like that. Well, the key to the time line is the mexican elections are next year. The president ial election. So the closer we get to the election the more difficult it will be to get anything through. In that regard, they resemble the situation in the u. S. The closer you get to the president ial election, more difficult to get something through. I know carls got a final question for you. Finally, mr. Secretary, we heard that sound bite with the president talking about the balance between addressing china on trade and trying to enlist their help in addressing north korea. Has north korea made it more difficult for the u. S. To be aggressive on trade . More difficult than youd like . Well, i dont think so. We have actually been having some very constructive discussions on trade with the chinese in parallel. I think what the president was trying to say was were trying to have the overall constructive relationship with china on a variety of topics. The most pressing of which because it directly involves human lives is the north korea situation. I dont think he meant to indicate at all that he intends to trade away american jobs just for help on north korea. Briefly, mr. Secretary, when will we start to see those promised America First bilateral trade deals and whos first in line . Well, we are on notice to the congress about nafta. When Vice President pence and i were in japan a couple of weeks ago, we also began an economic and Strategic Dialogue with japan. And so were exploring a variety of sectors in which to have those discussions. But we are not able to go forward with nafta until the Congress Grants us the trade promotion authority. And thats not in our Decision Making capability. Its totally within the hands of the congress. Mr. Secretary, always good to talk to you. Thanks for the time. Thank you for having me on. I look forward to continuing the discussion. Wilbur ross, commerce secretary at the milken conference with david faber. As we head to break, look at the shares of bhp billiton the Worlds Largest mining company, sitting down with activist Elliott Management who is pushing for changes. This as the pull singer came off removing Klaus Kleinfeld from a role. The stock is up a quarter of a percent. More squawk on the street after this. After this. Its been over 100 years since the first stock index was created, as a benchmark for average. Yet a lot of people still build portfolios with strategies that just track the benchmarks. But investing isnt about achieving average. Its about achieving goals. And invesco believes doing that today requires the art and expertise of highconviction investing. Translation . Why invest in average . That does ron paul thinks the Federal Reserve needs to do first . Well ask him on trading nation. Stocks are on the move higher. The focus is earnings and a lot of the big cat tech names that are set to report this week are already strong, reaching record highs. Check out for instance, netflix, apple, facebook, all at records. Apple will report results tomorrow after the closing bell. This is the dows best performing stock so far this year. Up already 25 . A lot of focus on the overseas cash pile which the wall street journal says could reach as much as 250 billion. Well look for that number and much more tomorrow. Facebook reports on wednesday. Its stock also has been a monster this year at a record high. Thats why the nasdaq the outperforming yet again and the dow went positive. Its now back up, now 27 points. How about that for a setup, jon fortt, for whats coming up next on squawk alley. Well, sara, thats what well talk about. Apple, and then some debt and dividend obligations also facebook coming up. Look, tech has been on fire this earnings season. Well dig into what thats about and whether it the continue con squawk alley coming up at the top of the hour. Im in vests and as a vested investor in vests, i invest with e trade, where investors can investigate and invest in vests. Or not in vests. This is my retirement. Retiring retired tires. And i never get tired of it. Are you entirely prepared to retire . Plan your never tiring retiring retired tires retirement with e trade. The power of the nasdaq market. The power of 100 of the worlds top companies. The power of an etf. The power of qqq. The thinking we put in, clients get out. Power your clients portfolio at powershares. Com qqq. Before investing, consider the Funds Investment objectives, risks, charges and expenses. Call 8009830903 for the prospectus containing this information. Read it carefully. Distributed by invesco distributors inc. Tenyear yield ticking a bit higher under 2. 30. Lets kick it out to rick santelli. Good morning. We just want a note throughout the nasdaq chart, nasdaq flirting in record territory. Looks like its dragging other indices higher as well. Today ben bernanke on squawk box. Steve liesman, what a great get. Heres what i heard. Alls well that hasnt ended yet. We open everything ends well. When it comes to Balance Sheet, pretty much full strength. I digress. Lets start at the beginning. Ben bernanke called out his critics on hyperinflation. Hes right. In many ways, i was one of those critics. I made a bad assumption. You know what my assumption was . All of these wild things they were doing throwing all this money out there would result in growth. It would result in productivity. It would result in a pretty big economic move. It didnt. Because we all missed one chapter of the book on the road to inflation. That was stock buy backs in large part. Financial assets definitely experience what i call some pricing upside there. Yes. The strategy was this is for the middle class. This isnt for wall street. This is for main street. It didnt turn out that way. Unintended consequences. It was recycled into the financial assets. They absorbed it. But the key to this conversation is quantitative easing. Im not sure what im most fearful of in the future. No doubt the fed praobably over decades can let this thing runoff but its the precedence that we set. Do things in small doses doesnt sometimes equate to large scale helpings especially from an international perspective. He brought up something that i found super interesting because we did a piece on this wednesday or thursday. If you look at the size of the u. S. Economy and the size of the fed Balance Sheet, Balance Sheet is about 25 . Uk about 25 . Ben bernanke talked about this. Whats japan . Japan is 100 . Ecb is about 35 . Thats what im a bit worried about. Im not sure everybody can use large helpings of the same medicine without what theyre trying to cure become somewhat resistant or even a little bit aggressive towards pulling back on this medicine because ultimately the supreme test will be when these Balance Sheets reduce, when negative interestn. We all hope it turns out well but in the end its a bit early to make that particular observation. Carl, back to you. Rick, well check in with you in a bit. Rick santelli in chicago. As we take a break, one last check on the markets here before we reset for the hour. Dow up 19 and nasdaq leading the charge. Hey gary, what are you doing . Oh hey john, im connecting our brains so we can share our amazing trading knowledge. Thats a great idea, but why dont you just go to thinkorswims chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders . I know. Your brain told my brain before you told my face. Mmm, blueberry . Tap into the knowledge of other traders on thinkorswim. Only at td ameritrade. Stay with me, mr. Parker. When a critical patient is far from the hospital, the hospital must come to the patient. Stay with me, mr. Parker. The at t network is helping First Responders connect with medical teams in near real time. Stay with me, mr. Parker. Saving time when it matters most. Stay with me, mrs. Parker. Thats the power of and. [phi anne. G] so those financial regulations being talked about . They could affect your accounts, so lets get together and talk, and make sure everythings clear. Yeah, that would be great. Being proactive. Its how edward jones makes sense of investing. Welcome back to squawk on the street. Markets are mostly higher with nasdaq outperforming rising half percent to a new record high today. Technology standing as one of the leading sectors up by half a percent as number of tech stocks hit fresh alltime highs in early trading. You have autodesk, apple, facebook, activision blizzard. Big week for tech stocks overall as several Companies Release quarterly Earnings Reports including apple and facebook. The sector is the years best performer up more than 15 so far. As we talk about trade here, Technology Front and center today, guys. Lets send it back downtown for the start of squawk alley now that this hour of squawk on the street is over. Thank you very much. Good morning. It is 8 00 a. M. At applecuperti. 11 00 a. M. On wall street and squawk alley is live. Good monday morning. Welcome to squawk alley. Kicking off the month of may. Its going to be a busy week in our Nations Capital from health and tax reform to the rising tensions with north korea. The president weighing in on a number of those issues over the weekend and for that we turn to eamon javers in washington. Good morning. Reporter good morning. Fascinating