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dd917ae7a254379e04041aeb49fad974 | https://www.cnbc.com/2018/05/27/italy-president-under-pressure-to-accept-euroskeptic-minister.html | Italy president under pressure to accept euroskeptic minister | Italy president under pressure to accept euroskeptic minister
Simona Granati | Corbis | Corbis |Getty Images
Italy's would-be coalition parties turned up the pressure on President Sergio Mattarella on Saturday to endorse their euroskeptic pick as economy minister, saying the only other option may be a new election.
Mattarella has held up formation of a government, which would end more than 80 days of political deadlock, over concern about the far-right League and anti-establishment 5-Star Movement's desire to make the 81-year-old economist Paolo Savona economy minister.
Savona has been a vocal critic of the euro and the European Union, but he has distinguished credentials, including in a former role as an industry minister.
Formally, Prime Minister-designate Giuseppe Conte presents his cabinet to the president, who must endorse it. Conte, a little-known law professor with no political experiences, met the president on Friday without resolving the deadlock.
"I hope no one has already decided 'no'," League leader Matteo Salvini shouted to supporters in northern Italy.
"Either the government gets off the ground and starts working in the coming hours, or we might as well go back to elections," Salvini said.
Later 5-Star leader Luigi Di Maio said he expected there to be a decision on whether the president would back the government within 24 hours.
5-Star also defended Savona's nomination.
VIDEO1:3501:35Italy’s incoming government ‘strongly framed by the outside’: AnalystStreet Signs Europe
"It is a political choice ... Blocking a ministerial choice is beyond (the president's) role," Alessandro Di Battista, a top 5-Star politician, said.
Mattarella has not spoken publicly about Savona, but through his aides he has made it clear he does not want an anti-euro economy minister and that he would not accept the "diktat" of the parties.
Savona's criticism of the euro and German economic policy has further spooked markets already concerned about the future government's willingness to reign in the massive debt, worth 1.3 times its annual output.
The League and 5-Star have said Savona should not be judged on his opinions, but on his credentials. Savona has had high-level experience at the Bank of Italy, in government as industry minister in 1993-94, and with employers' lobby Confindustria.
On his new Facebook page, Conte said he had received best wishes for his government in a phone call with French President Emmanuel Macron.
European Commissioner for Economic Affairs Pierre Moscovici was not hostile when asked about Savona in an interview with France's Europe1 radio, saying he would work with whoever Italy named.
"Italians decide their own government," Moscovici said. "Italy is and should remain a country at the heart of the euro zone... What worries me is the debt, which must be contained."
The prospect of Italy's government going on a spending spree on promised tax cuts and welfare benefits roiled markets last week.
On Friday, the closely watched gap between the Italian and German 10-year bond yields, seen as a measure of political risk for the euro zone, was at its widest in four years at 215 basis points.
VIDEO5:0905:09Luxembourg finance minister: Italy has always been faithful partner of the EUStreet Signs Europe
The chance that the new government will weaken public finances and roll back a 2011 pension reform prompted Moody's to say -- after markets had closed on Friday -- that it may downgrade the country's sovereign debt rating.
Moody's has a 'Baa2' long-term rating with a negative outlook on Italy. A downgrade to 'Baa3' would take the country's debt to just one notch above junk.
Despite the recent surge, Italian yields are well below the peaks they reached during the euro zone crisis of 2011-2012, thanks mainly to the shield provided by the European Central Bank's bond buying program.
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e83e8100b0960eb33ad1c26f8d812870 | https://www.cnbc.com/2018/05/28/asia-markets-oil-prices-stocks-currencies-and-north-korea-in-focus.html | Major markets in Asia close lower amid dampened sentiment | Major markets in Asia close lower amid dampened sentiment
Major markets in Asia closed lower on Tuesday, with Italian politics and the slide in oil prices in the spotlight.
Japan's declined 0.55 percent, or 122.66 points, to 22,358.43 amid broad-based losses, with strength in the yen weighing on major exporters. The safe-haven yen traded at 108.92 to the dollar at 3:00 p.m. HK/SIN, compared to Monday's close of 109.41.
Electronics stocks finished the day lower, as did steelmakers, with the broader Topix slipping 0.48 percent.
Over in South Korea, the Kospi fell 0.88 percent to 2,457.25 as gains in some technology names failed to lift the broader index. Banks and most manufacturing stocks saw declines.
Elsewhere, the slid 0.88 percent by 3:05 p.m. HK/SIN, hurt by losses in the heavily weighted financials sector. Shares of insurer AIA, in particular, fell 1.79 percent before the market close. On the mainland, the gave up early gains to close 0.47 percent lower at 3,120.47 and the smaller Shenzhen composite dropped 1.07 percent.
The S&P/ASX 200 was a bright spot, with the index tacking on 0.16 percent to close at 6,013.60 as large cap banks buoyed the market. Energy stocks which had been hit in the last session pared some overnight losses, with Woodside Petroleum edging up by 0.32 percent.
On the whole, MSCI's broad index of shares in Asia Pacific excluding Japan was lower by 0.58 percent in Asia afternoon trade.
Several markets in Southeast Asia, including Singapore, Malaysia and Thailand, were closed on Tuesday for a holiday.
With U.S. and U.K. markets closed on Monday, investors kept an eye on Italy. Recent political turmoil in the country saw the FTSE MIB fall more than 2 percent in the last session.
The leader of Italy's Five Star Movement party called for the country's president, Sergio Mattarella, to be impeached after the latter chose to veto a pick for economy minister. Mattarella on Monday appointed a former International Monetary Fund economist to the role of interim prime minister, with snap elections expected.
"[I]t's fairly light on the ground in terms of fundamental economic data releases today and so focus will continue to remain on the various geopolitical themes dominating market moves as we return to full liquidity conditions," Nick Twidale, chief operating officer at Rakuten Securities Australia, said in a note.
The euro was under pressure on the back of that uncertainty, trading at $1.1593 at 3:00 p.m. HK/SIN after crossing the $1.17 handle in the last session.
The dampened sentiment also saw U.S. Treasury yields open lower on Tuesday. The yield on the benchmark 10-year U.S. Treasury opened at its lowest levels in six-weeks, Reuters said, and last stood at 2.88 percent.
Investors also digested geopolitical developments involving North Korea after delegations from the U.S. and the hermit state met on Sunday. That came despite U.S. President Donald Trump's announcement last week that he was canceling a planned summit in June with North Korean leader Kim Jong Un.
The U.S. has readied sanctions on Pyongyang that could be unveiled soon, but was reportedly postponing the measures as the two countries attempted to resurrect talks.
Oil prices were mixed on Tuesday: U.S. crude futures were down 1.75 percent at $66.69 per barrel and Brent crude futures edged higher by 0.16 percent to trade at $75.42. Prices had dropped on Monday after top producers Saudi Arabia and Russia last week signaled they could raise production.
In individual movers, LG Display jumped 5.23 percent while Japan Display tumbled 7.97 percent. The divergent moves came after a report from South Korean newspaper Electronic Times, citing anonymous sources, that Apple would use organic light-emitting diode screens for new iPhones in the new year, Reuters said.
— CNBC's Sam Meredith contributed to this report.
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c2023e5f7f7edbef70061b98eb6e0632 | https://www.cnbc.com/2018/05/28/cctv-script-160518.html | CCTV Script 16/05/18 | CCTV Script 16/05/18
— This is the script of CNBC's news report for China's CCTV on May 16, 2018, Wednesday.
Previously, some areas of the United States that legalized gambling, including sports betting, take the gambling as an important source of tax. For example, the market scale of gambling in state of Nevada reached $4.8 billion last year and its total number in black market is estimated to be several times that of the legalized sports betting market. The American Gaming Association estimates the black market trades at least $150 billion on illegal sports-betting annually in US. And it's nearly enough to buy every franchise in the NFL, NBA, and MLB; thus, from the perspective of market, the legalization of sports betting that is sanctioned by the US Supreme Court will definitely improve the tax income and boost economy.
Meanwhile, the supporters of sports betting believe that this decision offers a new form of entertainment to sports fans and it will change the Sports consumption patterns, even contribute to traditional TV's ratings and make the competition more interesting. For instance, Mark Cuban, Dallas Mavericks owner and billionaire investors, said in the CNBC interview that this decision could double the value of the top four professional sports teams.
For markets, the stocks of several US casino companies increased after the news was announced. We can see that the stock price of these gaming companies includes Scientific Games Corp, Caesars Entertainment Corporation and Churchill Downs rise significantly in this week.
Some companies that have gaming business have already prepared to enter the sports betting market, just waited for the sanction. For example, the CEO of MOM told CNBC that they have already build the architecture for sports betting.
[Jim Murren, CEO, MGM] "We have already established the architecture to deploy sports betting as soon as states allow ius to do that. I would think our decades of relationships with the league, with the teams in nevada, that we will be a sig player if not largest player in the market."
We also mentioned just now that the market anticipates this sanction may spur the media companies do more investment on sports league. On the one hand, from the betting in competition to the improvement of advertising effect, higher ratings will increase the bargaining power of traditional media in broadcasting sports events. However, a contradictory point is that we are not sure whether the media companies are willing to enter the sports betting market or not. We know that the sports channel ESPN that under Disney tried investing Draft King, a sports game related to betting, but Disney finally gave up this plan because Disney wanted to protect its brand reputation from gambling. Additionally, many people also against this sanction, some US sports institutions declared position expressing their opposition, they think the gambling will threaten the credibility of sports competition and distract people's attention on sports competition.
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237029dc7d5087e274bd4a3e226cdf88 | https://www.cnbc.com/2018/05/28/traders-are-worried-this-could-be-the-big-unwinding-for-italian-bond-markets.html | Traders are worried this could be the 'big unwinding' of Italian bond markets | Traders are worried this could be the 'big unwinding' of Italian bond markets
VIDEO1:5501:55Strategist: See more elections in Italy taking place in the fallSquawk Box Europe
Italian bonds have witnessed one of their worst trading weeks since the euro zone sovereign debt crisis, with many traders getting a stark reminder of the volatility that once characterized markets in the region. On Friday, two-year Italian bond yields rose 35 basis points in one day — almost equivalent to the entire range of the year for U.S. 10-year Treasurys. This was the weakest session in five years and continued a month that's seen these yields rise 70 basis points in total.
Yields move inversely to a bond's price and a spike higher is seen as investors feeling more concerned about lending to Italy's government. More specifically, traders usually sell short-maturity paper when there are growing credit risk concerns at a sovereign level.
The original catalyst for the selling came from the populist parties hoping to take control of Italy after inconclusive elections in March. Lega and the Five Star Movement (M5S) plan to issue short-term bills to finance state activity in their economic policy proposals. Market participants were taken aback and many have interpreted that initiative as laying the foundation for a potential parallel currency in the future, further amplifying the potential new government's collision course with the rest of Europe.
VIDEO2:5802:58Italy's Lega could gain more power in fresh elections, analyst saysSquawk Box Europe
But the fear has not been limited to short-dated paper. Ten-year Italian bonds have also came under pressure with yields topping 2.5 percent and are now trading at their widest gap with German paper in over four years. There is palpable anxiety in the market as Italy's political future remains uncertain. Over the weekend, M5S and Lega looked to have failed in their bid to form a government after President Sergio Mattarella rejected their pick for economy minister due to his euroskeptic credentials. This has raised the prospect of a caretaker government to lead the country into yet another round of elections later this year. In Monday's trading session, and with liquidity in markets thin due to the U.S. Memorial Day, Italian two-year yields briefly snapped back 15 basis points tighter before paring all the gains of the day. Traders have pointed to short covering in the market. However, the relief rally may be short lived. One head of trading at a large fund manager, who preferred to remain anonymous due to the sensitive nature of the situation, told CNBC that a "big unwinding" is beginning for Italian bonds and Monday's pullback would not last long.
Ratings agencies are also beginning to raise alarm bells. On Friday, Moody's hinted that it may look to review Italy's debt rating, citing concerns over the two anti-establishment parties' fiscal plans that could ratchet up spending by as much as 100 billion euros ($117 billion), according to some analysts.
VIDEO3:5903:59Conflict between Italy's parliament and government will be intense: ProSquawk Box Europe
With outstanding debt of more than 2.3 trillion euros and one of the highest levels of debt-to-gross domestic product in the advanced world, Italy's public finances will come under scrutiny again if spending ramps up.
Gene Frieda, a global strategist at Pimco, told CNBC via email that the immediate concern for investors is that another round of elections and the prospect of a right-wing anti-European populist government undermines the economic recovery in Italy.
"(It) threatens further rating downgrades. In that context, even after the recent sell-off, BTPs (Italian bonds) do not look particularly cheap," he said.
On Monday, Matteo Salvini, the leader of the right-wing Lega party, further added to market concerns saying that there is no point staying in the EU if the rules don't change. This has prompted some analysts to believe that if there is another election on the horizon, one that would effectively be a referendum on the euro. According to Goldman Sachs analysis, the European Central Bank owns around 20 percent of outstanding Italian bonds due to years of quantitative easing, but foreign investors also own about 37 percent. The question is then, will investors still want to own that risk into what could be a binary event?
—CNBC's Annette Weisbach contributed to this article.
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091e4fad54493644d6233236e03ceae4 | https://www.cnbc.com/2018/05/28/va-veterans-affairs-history-setbacks-missteps.html | The VA's history of setbacks and missteps | The VA's history of setbacks and missteps
A new chapter could be in store for the Department of Veterans Affairs.
On May 18, Trump announced he plans to nominate acting Secretary Robert Wilkie as permanent head of the agency.
If confirmed by Senate, Wilkie would face a long list of issues.
While the VA is rooted in noble intentions, it has been plagued with problems for years.
The VA has faced reports of excessive and contradictory spending, allegations of inadequate health care, a massive backlog of benefits claims and a top leadership position that nobody can seem to hold down.
It hasn't always been this way. The agency was elevated to federal administration status in 1930, with the intention to honor and care for the men and women who served in battle.
Since then, the U.S. has been involved in a growing list of military operations, including the 17-year-long war in Afghanistan. The VA is struggling to keep up as the need for veterans care continues to mount.
Pedestrians walk past the U.S. Department of Veterans Affairs (VA) headquarters in Washington, D.C.Andrew Harrer | Bloomberg | Getty Images
Some veterans can't get to care centers because they live too far away. The VA's Office of Rural Health is working to address the problem through solutions like telehealth and transportation services.
Other veterans are facing wait times of months, or even years, just to get an appointment at their VA care center. Rep. Beto O'Rourke, D-Texas, is trying to solve that problem in his own district. In 2015, O'Rourke introduced a proposal to improve the El Paso VA Health Care System. The VA backed the plan and approved it for a pilot test, which O'Rourke says has been going well.
And he doesn't rely on the VA itself to tell him how things are going. O'Rourke's team conducts its own annual survey to gauge how accessible the VA really is to veterans in El Paso.
"We don't trust the VA to tell us how the VA is doing, we trust veterans to tell us how the VA is doing," said O'Rourke, who is running to take on Republican Sen. Ted Cruz this fall.
Rep. Beto O'Rourke, D-TexasBill Clark | CQ Roll Call | Getty Images
But the VA as a whole is still facing a long list of problems.
The benefits claims process for veterans is a bit like a game of legal "Chutes and Ladders."
"Veterans have heard stories, but a lot of them are surprised when they encounter the VA," said Jim Vale, assistant director for claims at the American Legion. "The most important thing is to be represented."
Fixing the VA isn't a partisan issue. It's not specific to one demographic group or geographic region. Every U.S. representative has a veteran in their district, and nobody wants to be on the wrong side of the issue.
There's a lot riding on Wilkie's nomination. The VA's new leader will be responsible for the largest integrated health-care system in the U.S., and the well-being of more than 9 million veterans.
— CNBC's Dan Mangan and Amanda Macias contributed to this report.
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376094ffe22c088feeb25be225ae2f9e | https://www.cnbc.com/2018/05/29/blue-state-democrats-have-a-new-cause-helping-millionaires.html | Blue-state Democrats have a new cause: Helping millionaires | Blue-state Democrats have a new cause: Helping millionaires
Tax hikes, corporate flights and an ongoing trend of economic migration away from the state have deemed Connecticut Gov. Dannel Malloy one of the least popular governors in the nation.Getty Images
One of the core beliefs of the Democratic party is fairness. Tax the rich, help the poor and spread the gains of a growing economy more widely.
It has been a consistent message by federal and state lawmakers alike. Until now.
On the heels of the new Republican tax law, state Democrats, who until recently were advocating higher taxes on the rich, are suddenly fighting to protect their own members of the top 1 percent from higher taxes. Some Dems are even proposing both — raise taxes on the wealthy with one hand and help them with the other. The new divide is the result of the so-called SALT provisions of the new tax law. Taxpayers can only deduct up to $10,000 in state and local taxes from their federal returns. In high-tax states like New York, New Jersey and Connecticut, more than a quarter of one-percenters will see tax hikes under the new cap in 2019. In New York, a whopping 40 percent of one-percenters will see tax hikes under the plan. The Democratic governors of all three states have passed legislation aimed at helping those one-percenters avoid the new tax provision. In New York and New Jersey, they've proposed a scheme to allow taxpayers to give to charities that support local schools and other government services, and then allow those donations count as tax credits and become tax-deductible.
VIDEO0:4800:48US added 700,000 new millionaires in 2017News Videos
Connecticut has passed a law that allows owners of pass-through businesses the ability to avoid the higher taxes with a special tax-credit scheme.
All of these special laws are aimed squarely at helping the wealthy. It's chiefly the high earners and affluent who suffer from the SALT deduction cap of $10,000. According to one analysis, nearly 60 percent of the added revenue from the SALT changes will come from the top 1 percent. While the Democratic politicians still say they're fighting for fairness, the gap is more political than economic — the red-state rich will get a big tax cut while many of the blue-state rich will pay more. While decrying the federal tax cut as a "massive giveaway for the very wealthy," Connecticut Governor Dannel P. Malloy spearheaded the state's plan to help owners of pass-through businesses (where the wealthy account for most of the income) and help those who want to deduct more than $10,000 in state and local taxes. New Jersey, however, offers the most stark example of the blue-state shuffle over the rich. Democratic Governor Phil Murphy has criticized the federal tax law and led the state's efforts to help taxpayers avoid the SALT increases. At the same time, he is proposing a tax on new millionaire earners to fund infrastructure and education spending. New Jersey state Senate President Stephen Sweeney was once a chief supporter of New Jersey's millionaire tax, tweeting about the "long-overdue millionaires tax." Now, following the federal tax law, he said a tax aimed at the wealthy is "the absolute last thing I'm willing to look at." He said the state can't risk losing more taxpayers to lower-tax states. "I'm not going to run in and do something that's going cause even more problems for the economy," he told NJ Advance Media. So it turns out, many Democrats do want to tax the rich — but only to a point.
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17d523cfac8d4662b80d281666422157 | https://www.cnbc.com/2018/05/29/charts-point-to-trouble-for-automakers-and-ford-in-particular-technician-says.html | Charts point to trouble for automakers, and Ford in particular, technician says | Charts point to trouble for automakers, and Ford in particular, technician says
VIDEO7:0407:04As summer begins, here's how rising gas prices will affect travel plansOptions Action
As gas prices are at multiyear highs, a top technician warns the move could be stirring up trouble for one automaker.
The CARZ Auto ETF, whose top holdings include names like General Motors, Toyota and Ford, has fallen nearly 7 percent this year. This comes as rising gas and oil prices put pressure on consumer discretionary spending.
Furthermore, Carter Worth, head of technical analysis at Cornerstone Macro, noted that the auto ETF, which has seen an impressive 38 percent rally off its 2015 lows, has recently fallen below a key level of resistance around $42.
"One thing we know is that after the double-bottom in the breakout we had a failed breakout," he said Friday on CNBC's "Options Action" "Once you break out you should hold, we've undercut."
The autos ETF reached all-time highs in January, but has fallen nearly 12 percent since. According to Worth's thesis, the move lower has set up a bearish wedge pattern in the charts, indicative of more losses ahead.
The automakers have also been a major underperformer relative to the broader market. The has rallied 28 percent since 2015, while the auto ETF is down nearly 4 percent in the same time period.
Ford, which makes up more than 8 percent of the autos ETF, is down nearly 9 percent for the year but has recently shown signs of resurgence. Shares of the automaker are now up more than 10 percent from their January lows.
Nonetheless Worth warns that despite the move higher, shares of Ford historically tend to fall after hitting the top of their downtrend level — indicating that the relief rally could be coming to an end.
"I think at this point you're about to get your next sell-off. I don't like Ford I want to sell it," he said.
Shares of Ford were trading lower Monday afternoon at around $11.40.
Disclaimer
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6805cdebad564506db599b4410126628 | https://www.cnbc.com/2018/05/29/chinese-state-media-slam-us-trade-announcement-say-beijing-ready-to-fight.html | Chinese state media slam US trade announcement, say Beijing ready to fight | Chinese state media slam US trade announcement, say Beijing ready to fight
Chinese state media criticized a U.S. announcement that it would press ahead with restrictions on investment by Chinese companies, saying on Wednesday that Beijing was ready to fight back if Washington was looking to reignite a trade war.
Containers stacked at a port in Lianyungang in the northeastern Jiangsu province of China.VCG | Getty Images
The United States said on Tuesday it still held the threat of imposing tariffs on $50 billion of imports from China and would use it unless Beijing addressed the issue of theft of American intellectual property.
China commerce's ministry reacted harshly, saying it was surprised and saw it as contrary to the consensus both sides reached recently. State news agency Xinhua said China hoped that the United States would not act impulsively but stood ready to fight to protect its own interests.
"China's attitude, as always, is: we do not want to fight, but we are also not afraid to fight," it said in the commentary by Xinhua reporter Yu Jiaxin. "China will continue to hold pragmatic consultations with the United States' delegation and hope that the United States will act in accordance with the spirit of the joint statement," it said.
Chinese tabloid the Global Times said the United States was suffering from a "delusion" and warned that the "trade renege could leave Washington dancing with itself."
VIDEO5:1605:16US fighting three-front war on trade, says former US trade repSquawk Box
The widely read Global Times is run by the ruling Communist Party's official People's Daily, although its stance does not necessarily reflect Chinese government policy. "The Chinese government will have the necessary measures in place to deal with a US withdrawal from any settled agreement.
"If the US wants to play games, then China would be more than willing to play along and do so until the very end," it said. The China Daily newspaper said the repeated U.S. claim that China had forced foreign firms to transfer their technologies to Chinese businesses was without evidence and was being used as an excuse to facilitate its trade protectionism.
It said technology transfers between U.S. companies and their Chinese partners were the result of normal business practices, not coercive policies.
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2806723e2321ff9f7cf89528cd1697f5 | https://www.cnbc.com/2018/05/29/ex-mcdonalds-ceo-starbucks-closures-shouldnt-have-had-to-happen.html | Ex-McDonald's CEO: Starbucks' store closures for bias training shouldn't have needed to happen | Ex-McDonald's CEO: Starbucks' store closures for bias training shouldn't have needed to happen
VIDEO3:3803:38Tragic that Starbucks will lose customers and profit today, says former McDonald's CEOSquawk Alley
It's Starbucks' own fault that it will lose money due to Tuesday afternoon's closing of thousands of its locations for anti-racial bias training, former McDonald's CEO Ed Rensi told CNBC.
"It's tragic that Starbucks is going to lose customers ... for training that should be done every day of the week, every hour of the day," Rensi said on "Squawk Alley."
Starbucks should never have gotten itself "in a position like this" in the first place, he adds.
The coffee giant will close more than 8,000 of its U.S. locations for several hours on Tuesday afternoon to conduct anti-bias training. The course — offered to its more than 175,000 employees — is aimed at addressing the issues surrounding the arrests last month at a Philadelphia Starbucks of two black men waiting for a business meeting.
The issue of any racial bias in Starbucks' stores can be easily resolved through "common sense," said Rensi, while saying Chairman Howard Schultz and CEO Kevin Johnson are good leaders.
"Treat people the way you want to be treated," said Rensi, also formerly CEO of barbecue chain Famous Dave's of America. "To have police come and roust out two black men in your facilities is unconscionable."
However, he said he would never have closed the stores for the training "because that means I'm making a lot of customers angry."
Earlier on CNBC, Andy Puzder — formerly chief executive of CKE Restaurants, the owner of the Hardee's and Carl's Jr. chains — questioned some of the steps Starbucks took as part of its anti-racial bias campaign.
Puzder, now a policy advisor at the pro-Trump group America First Policies, argued Starbucks' new policy allowing anyone, even if they don't buy anything, to sit in its cafes and use the restrooms may have been a mistake.
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7d8fe842bdd1b4535b388024da784c6f | https://www.cnbc.com/2018/05/29/iran-nuclear-weapons-treaty-exit-would-be-rocket-fuel-for-oil-price.html | Iran's exit from nuclear weapons treaty would pour 'rocket fuel' on oil market, says analyst | Iran's exit from nuclear weapons treaty would pour 'rocket fuel' on oil market, says analyst
VIDEO2:5902:59Oil market is ignoring the big Iran story, says strategistSquawk on the Street
The U.S. exit from the Iran nuclear deal creates the risk that Iran will drop out of a separate 50-year-old United Nations treaty meant to stop the spread of atomic weapons, according to Helima Croft, global head of commodity strategy at RBC Capital Markets.
Oil prices have recently surged to 3½-year highs, fueled the U.S. nuclear deal pullout and falling output in Venezuela. However, crude prices began tumbling last week after Saudi Arabia and Russia said two dozen oil-producing nations could soon ease output caps that have been in place since January 2017.
But fears of nuclear weapons proliferation in the restive Middle East could quickly reverse that drop, according to Croft.
An Iranian official threatened last week to pull out of the U.N. Treaty on the Non-Proliferation of Nuclear Weapons, which has sought to prevent the spread of atomic weapons since 1968. Iran signed the treaty that year, but the nation's leadership in Tehran is now in a standoff with the West over its nuclear program after President Donald Trump abandoned the 2015 nuclear deal and restored punishing sanctions on the Middle Eastern country.
If they come to believe that the U.S. and the regional partners are pursuing regime change, I think we could get a very nasty Iranian response.Helima CroftRBC Capital Markets global head of commodity strategy
"I think this is the question the market is ignoring right now. I would watch very closely the Iranian announcement to pull out of the nonproliferation treaty," Croft told CNBC's "Squawk on the Street" on Tuesday. "If they pull out of the NPT, that would signal that not only are the Iranians going to resume their program, they're resuming it with a military option."
"And then it would become, I think, an arms race in the Middle East," she added.
In March, Saudi Arabia's Crown Prince said his country would obtain a nuclear weapon "as soon as possible" if Iran, the kingdom's archrival, developed one. Israel, which has recently engaged in open conflict with Iran, is widely believed to possess nuclear weapons already.
Iran came under international criticism in the early 2000s and was later sanctioned for its alleged research into nuclear weapons development while ostensibly pursuing a peaceful energy program. After years of diplomacy, Iran reached a deal with six world powers that lifted the sanctions in exchange for Tehran accepting limits on its nuclear program and allowing inspectors into the country.
Under the NPT, countries without nuclear weapons like Iran vow never to acquire them. The 2015 nuclear deal — negotiated with Britain, China, France, Germany, Russia and the Obama administration — subjected Iran to extra scrutiny in order to re-establish trust with the international community.
An Iranian military truck carries surface-to-air missiles past a portrait of Iran's Supreme Leader Ayatollah Ali Khamenei during a parade on the occasion of the country's annual army day on April 18, 2018, in Tehran.Atta Kenare | AFP | Getty Images
But the pressure campaign now being waged by the Trump administration could push Iran to abandon both the nuclear deal and the NPT, Croft said. The European Union is trying to preserve the 2015 deal, but America's influence over the global financial system means many European companies may toe the U.S. line, despite the EU's efforts to shield them from far-reaching sanctions.
Iran's economy is already weakening, spurring protests over corruption in the banking system and other grievances. This year, Iran's currency has collapsed, and its uncertain how Iran will respond to the added pressure from a loss of international business, said Croft.
"If they come to believe that the U.S. and the regional partners are pursuing regime change, I think we could get a very nasty Iranian response," she said.
U.S. Secretary of State Mike Pompeo's first major speech last week drew speculation that the administration's policy is indeed to topple the nearly 40-year-old regime in Tehran. While Pompeo has sought to tamp down that speculation, the Iranians may not be convinced, said John Kilduff, founding partner at energy hedge fund Again Capital.
"They're like playing a game of Jenga, where you push the blocks out, because they're hoping for the regime to tip over," he told "Squawk on the Street" on Tuesday.
"And as much as European Union officials are trying to say that they want to have a workaround against these U.S. sanctions, all the companies, the banks and the oil companies, are all in the process of pulling out and saying we're not touching that with a 10-foot pole."
VIDEO1:4301:43Helima Croft talks about Saudi Arabia and Russia's impact on the oil marketWorldwide Exchange
Both Croft and Kilduff said Trump's pullout has given Saudi Arabia the upper hand in the oil market. Trump essentially made a bargain to pull out of the Iran deal so long as the Saudis agreed to increase oil output to offset any price spike that resulted from the loss of Iranian crude supplies, according to Croft.
U.S. Treasury Secretary Steve Mnuchin recently told reporters the United States held discussions with "various parties" to pump more to offset falling Iranian exports, which could raise gasoline prices for American drivers.
"We're back hat in hand to the Saudis saying put more barrels on the market," Croft said.
"This is the issue, is that the U.S. cannot deal with a supply shock. We have to go back to countries that hold spare capacity. So when Venezuela potentially loses over the course of a year a million barrels, if we take off several hundred additional Iranian barrels, Saudi Arabia has to fill the gap."
While the United States is pumping about 10.7 million barrels a day — overtaking Saudi Arabia and closing in on top producer Russia — bottlenecks in western Texas will prevent American drillers from fully compensating for lost Iranian supplies, Kilduff said.
"If there's one thing this episode should tell us all, we are not the swing producer. Saudi Arabia is," he said. "They're more in control now than I've ever seen."
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f5bedb602caddefe5b8a67de80e950d0 | https://www.cnbc.com/2018/05/29/ivanka-trump-chinese-trademarks-raise-conflict-of-interest-questions.html | Ivanka Trump's Chinese trademarks raise questions about potential conflicts of interest | Ivanka Trump's Chinese trademarks raise questions about potential conflicts of interest
VIDEO1:0601:06Ivanka Trump's trademarks raise questions about potential conflicts of interestNews Videos
Chinese trademarks issued to Ivanka Trump's fashion brand in May are raising questions over whether the first daughter is receiving special treatment from a foreign government or is simply the victim of bad timing.
The Chinese government awarded Ivanka Trump's fashion brand seven new trademarks, according to online records, just as President Donald Trump pledged to revive Chinese telecom giant ZTE. The trademarks, for items such as baby blankets, bamboo crafts and coffins, include products that the brand sells as well as items that it seeks to prevent others from selling with Trump branding.
On Friday, the Trump administration reportedly told Congress it had reached a deal with the Chinese government to lift a ban preventing ZTE from buying American goods if it paid a penalty for violating American sanctions on North Korea and Iran.
VIDEO0:5200:52Ivanka Trump's shoe factory in China is accused of abusing and beating workersDigital Original
Critics say the timing of the approval raises questions about potential ethical violations.
"As a White House adviser, Ivanka has represented the United States at multiple diplomatic events despite the potential conflicts her business interests present," Citizens for Responsibility and Ethics in Washington (CREW), a nonprofit good governance organization, wrote in its report on the trademarks.
Critics have also seized on the announcement, also in May, that a Chinese company will be building a theme park in Indonesia featuring Trump-branded properties such as a hotel and 18-hole golf course.
The president's daughter, who was hired as a White House advisor shortly after the president took office, continues to receive profits from her brand despite stepping down from her leadership role in the organization, according to CREW. She does not receive a government salary.
Watchdogs have criticized President Trump for bringing his family into the administration, as well as their decision not to completely disentangle from their sprawling businesses.
"Trump and his family are in the unique position to profit directly from his public service," according OpenSecrets, a nonpartisan watchdog that tracks money in politics.
The president has denied that there are any conflicts of interest. An Office of Legal Counsel memo last year, issued in response to questions about Ivanka Trump's husband and senior White House advisor Jared Kushner, said the White House is exempt from anti-nepotism laws.
Experts have said the trademarks may have been expedited because of Trump's popularity in the country, though it is not clear that the pace of approval is unusual. The applications for the trademarks were made more than a year ago, in early 2017, according to online records. Trump joined the White House a day after the applications were filed, though it had already been reported that she would move into a West Wing office.
In a statement, Abigail Klem, the president of the Ivanka Trump brand, said the trademarks were filed in the "normal course of business.""The brand has filed, updated, and rigorously protected its international trademarks over the past several years in the normal course of business, especially in regions where trademark infringement is rampant," she said. "We have recently seen a surge in trademark filings by unrelated third parties trying to capitalize on the name and it is our responsibility to diligently protect our trademark."
It is not the first time that Ivanka Trump's clothing line has raised concerns among critics. Last summer, the Associated Press reported that Trump received three trademarks on the same day that she dined with Chinese President Xi Jinping at Mar-a-Lago, the president's Florida resort.
Trump's brand has also faced criticism over its overseas manufacturing. The vast majority of Ivanka-branded clothing shipped to the U.S. since election day has been made in Asia, according to a NBC News analysis. The White House did not respond to a request for comment from CNBC.
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7cf70a912dc549612a280d27a0a91849 | https://www.cnbc.com/2018/05/29/mortgage-rates-drop-but-borrowers-are-not-impressed.html | Mortgage rates drop, but borrowers are not impressed | Mortgage rates drop, but borrowers are not impressed
VIDEO1:0901:09Mortgage apps down 2.9% vs. previous weekSquawk Box
After a sharp rise, mortgage interest rates stepped back a bit last week, but that did nothing to juice borrower demand.
Total mortgage application volume decreased 2.9 percent for the week, seasonally adjusted, according to the Mortgage Bankers Association. That marked the sixth straight week of losses. Volume was 10 percent lower compared with the same week one year ago.
Refinance volume, which is most rate sensitive and usually rises when rates fall, did just the opposite.
Applications to refinance a home loan fell 5 percent for the week to the lowest level since December 2000. Volume was nearly 27 percent lower than a year ago, when rates were lower. The refinance share of total mortgage application volume fell to its lowest level since August, 2008, at just 35.3 percent.
The weekly drop in interest rates was likely not enough to get borrowers to start the often tedious refinance process. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) decreased to 4.84 percent from 4.86 percent, with points decreasing to 0.47 from 0.52 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
"Rates slipped slightly over the week as concerns over U.S. trade policy and global growth sent some investors back to safer U.S. Treasurys. Minutes from the most recent FOMC meeting also yielded a more dovish tone, which added to the downward pressure in rates," said Joel Kan, associate vice president of economic and industry forecasting at the Mortgage Bankers Association.
Mortgage applications to purchase a home fell 2 percent for the week but were 2 percent higher compared with a year ago. Homebuyers today are less worried about interest rates and more concerned with weak supply and high prices. Affordability is weakening, especially at the lower end of the market, where demand is highest and supply is leanest.
Mortgage rates moved even lower to start this week, as a sell-off in the stock market caused a run on bonds. Political uncertainty in Italy unnerved global markets. Over the weekend Italy's president stopped the formation of a coalition government that may have sought to leave the euro. That had investors worried about the strength of the euro zone.
The U.S. 10-year Treasury yield, which mortgage rates loosely follow, fell to the lowest level since the start of April. Mortgage rates dropped as well, but the trajectory appears to still be higher.
"The things that were causing upward pressure on rates haven't changed," said Matthew Graham, chief operating officer at Mortgage News Daily. "It's a big 'if' to entertain the possibility that an Italian EU exit could overshadow all the headwinds for interest rates, even though it hits big in terms of shorter-term drama."
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4eac657ab4c0858db5513f95e136d449 | https://www.cnbc.com/2018/05/29/oil-markets-worries-over-growing-supplies-in-focus.html | US crude surges 2.2%, settling at $68.21, on signs OPEC's output caps may survive | US crude surges 2.2%, settling at $68.21, on signs OPEC's output caps may survive
A worker speaks on a mobile telephone as he passes Total SA branded oil drums stored in the warehouse at the Ladol free trade zone port in Lagos, Nigeria.George Osodi | Bloomberg | Getty Images
Oil prices rebounded sharply on Wednesday, supported by a report that Saudi Arabia, other OPEC states and non-OPEC allies aim to stick to a global pact on cutting oil supplies until the end of 2018.
The producers are ready to make gradual adjustments to offset any supply shortage, a Gulf source familiar with Saudi thinking said. The oil producers participating in the output reduction deal are satisfied with the result of their agreement, which was due to end at the end of 2018, the Gulf source told Reuters.
U.S. crude ended the session $1.48, or 2.2 percent, higher at $68.21. The contract fell about $5.50 a barrel, or 7.6 percent, over the last five trading sessions.
Brent ended Wednesday's trading up $2.11, or 2.8 percent, to $77.50 a barrel, after trading as low as $74.81 earlier.
VIDEO1:1001:10Charts show more pain possible for oilMad Money with Jim Cramer
Global benchmark Brent crude has dropped by as much as $5 a barrel this week from a 3½-year high of $80.50 a barrel on May 17, after reports that OPEC and Russia may increase supply at a June meeting.
Also on Wednesday, the Russian central bank issued a statement that a decline in oil prices would pose a risk to the country's financial sector.
"It seems that somebody in the central bank is taking notice of the big drop in oil prices and sending a signal of, 'Hey, wait a second. We don't want these prices to fall too far — that could pose a risk to the Russian economy"' said Phil Flynn, analyst at Price Futures Group in Chicago.
The Organization of the Petroleum Exporting Countries and non-OPEC producers led by Russia have had a pact to curb output by about 1.8 million barrels per day since January 2017, driving down inventories and pushing up oil prices.
Amid concerns the price rally has gone too far, Saudi Arabia and Russia are discussing raising OPEC and non-OPEC oil output by around 1 million bpd, sources told Reuters on May 25. OPEC meets in Vienna on June 22.
Some analysts remain cautious as the details have yet to be worked out. Ministers from Saudi Arabia, Kuwait and the United Arab Emirates meet this weekend, a source said.
U.S. crude's discount to Brent was as much as $9.31, with Brent supported more as investors worried that crude supplies from Iran could be drying up, with U.S. sanctions deterring buyers.
VIDEO3:2703:27Sweet spot for oil is $55-$65 range per barrel: Crestwood Equity Partners CEOPower Lunch
"There's more concern on the Brent side that supply losses from Iran are harder to be made up," Flynn said.
India's Reliance Industries, owner of the world's biggest refining complex, plans to halt oil imports from Iran, two sources familiar with the matter said.
Also supporting prices was a weaker dollar and forecasts that U.S. data will show crude inventories fell last week, analysts said.
U.S. crude inventories probably fell by 1.8 million barrels last week according to a Reuters poll. Industry group American Petroleum Institute (API) releases its weekly supply report at 4:30 p.m. ET on Wednesday, followed by the official government data on Thursday.
In Brazil, the FUP oil workers union said workers had joined the call for a nationwide strike on at least 20 oil rigs in the lucrative Campos basin and other areas of the country. Protesters are calling for the resignation of Petroleo Brasileiro SA Chief Executive Officer Pedro Parente and a change to company fuel pricing policies. The company said production was not affected.
— CNBC's Tom DiChristopher contributed to this story.
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4bf71b236faeccfc1a1d61b32c3a38fa | https://www.cnbc.com/2018/05/29/oral-injuries-lead-to-recall-of-spam-and-another-hormel-product.html | Oral injuries lead to recall of Spam and another Hormel product | Oral injuries lead to recall of Spam and another Hormel product
Cans of Spam, by Hormel, are displayed on a shelf at Cal Mart grocery store in San Francisco.Getty Images
The U.S. Department of Agriculture is recalling more than 228,000 pounds of Spam and another product made by Minnesota-based Hormel after four consumers complained about metal objects in the food.
The USDA's Food Safety and Inspection Service says the canned chicken and pork in question was produced in February at the company's plant in Fremont, Nebraska. The agency says "minor oral injuries" have been reported.
The recall covers 12-ounce metal cans containing "SPAM Classic" with a "Best By" date of February 2021 date. Those products were shipped throughout the U.S.
The production codes are F020881, F020882, F020883, F020884, F020885, F020886, F020887, F020888 and F020889.
The recall also includes 12-ounce metal cans of "Hormel Foods Black-Label Luncheon Loaf" with a "Best By" date of February 2021. Those products were shipped only to Guam, with production codes F02098 and F02108.
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b9da5594997e55bf44e9578b82a1ec46 | https://www.cnbc.com/2018/05/29/sheryl-sandberg-defends-facebook-at-code-2018.html | Sheryl Sandberg says Facebook didn't anticipate how people would abuse the platform | Sheryl Sandberg says Facebook didn't anticipate how people would abuse the platform
Facebook COO Sheryl Sandberg and CTO Mike Schroepfer at the 2018 Code Conference.Asa Mathat | Vox Media
How come nobody from Facebook got fired over the Cambridge Analytica data leak scandal?
That was the first question moderator Kara Swisher asked Facebook COO Sheryl Sandberg on stage at the Code Conference in Rancho Palos Verdes, California, on Tuesday.
"People do get fired," Sandberg said, but Facebook doesn't trot them out as examples.
But in the end, she said, responsibility belongs at the top. Mark Zuckerberg built the platform, and Sandberg and other members of the senior leadership team didn't anticipate well enough what would happen when all of humanity was using it.
Both Sandberg and Facebook CTO Mike Schroepfer tried to explain the difficulty of striking the right balance between free speech and safety on the platform. Schroepfer said there's a tension between "giving people tools for free expression, and really locking things down" by having human moderators read and vet every post on the site.
"We always had ways for people to control your data," he said, but now Facebook put it at the top of everybody's news feed and made it easy to delete it. "All of those controls existed, they were just harder to find for people, we just made them easier."
Addressing the reports of Russians using fake accounts to spread misinformation to sway the 2016 election, Sandberg once again said that they just didn't see it coming.
"Threats change," she said. In 2016, people were largely worried about spamming and phishing, following things like the Sony email hacks.
"We didn't see coming a different kind of more insidious threat, but once we saw it, we did publish a white paper" and made a series of changes. She said Facebook is taking strong steps for the 2018 midterm elections and the company looks forward to facing the challenge of bad actors trying to use Facebook to influence the results.
Sandberg also said that Facebook was thinking about how to disrupt the economic incentives that existed for generating outrageous stories -- for example by taking clickbait farms out of Facebook's ad networks.
VIDEO1:4601:46Facebook stock pops after Zuckerberg hearingSquawk Box
Sandberg argued that Facebook should not be broken up under antitrust laws, noting that there are safety benefits to having multiple products under the same company's control.
"If you are doing child exploitative content, WhatsApp is encrypted," she said, meaning it could allow criminals to exchange information without getting caught. But Facebook will know who they are when they post publicly on that platform and will be able to suspect their WhatsApp accounts as well.
Schroepfer also said that the company is working on allowing users to delete all information that Facebook has on them, similar to clearing information like cookies and sites visited from a web browser.
Finally, Sandberg noted that the company is making "huge investments" that will affect profitability to make the platform safer and prevent these kinds of abuse.
"It's the biggest cultural shift I've seen in the whole history of the company," said Schroepfer.
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097c91b9b3dc7b16048610c0a3792684 | https://www.cnbc.com/2018/05/29/the-sp-is-setting-up-to-benefit-traders-stymie-long-term-investors.html | Charting Asia | Charting Asia
Drew Angerer | Getty Images News | Getty Images
A double bottom pattern is developing in the .
While that's a bullish, dominant pattern in the index, its development is slow, indecisive and uncertain. That suggests it will run into strong resistance around the level of the double top pattern created in early 2018.
But rather than leading to a strong up trend breakout, the current reaction suggests the S&P index may become trapped in a long, slow sideways pattern with the market moving between 2,580 and 2,790.
That type of sideways pattern is good for traders as the market rallies and retreats within the confines of a broad trading band. It's not so good, however, for long-term investors because the market returns are limited by the strong resistance level. Investors look for a good breakout above the upper resistance level near 2,790.
The current behavioral relationships in the Guppy Multiple Moving Average indicator suggest that a strong breakout has a low probability of developing.
The short-term group of averages used to track the inferred behavior of traders has shown some compression and expansion activity. However, this is not particularly strong. There is no great trading conviction in the rallies, nor in the retreats.
The long-term group of averages is used to infer the behavior and thinking of investors. The degree of separation in the long-term GMMA is an indication of the strength of the trend and the confidence level of investors. That is seen very clearly on the left side of the chart. Compare that to the degree of separation seen on the right side of the chart and it's clear that investors have lost confidence in the market. The compression and clustering in the short-term group suggests market nervousness and a lack of commitment to a strongly developing uptrend.
This behavior confirms the potential to develop a sideways trading pattern in what becomes a directionless or moribund market.
That's also confirmed by the reduction in volatility. The daily ranges in the index activity — low to high — are small and about the same size anytime in 2016 until Jan. 29, 2018. The general uptrend is not interrupted by days of significantly large daily ranges.
After February 2018, the market is dominated by large daily ranges. The daily range between the low and the high expands dramatically, but in recent weeks stability has returned to the index. The daily ranges have reduced and are now similar to the period prior to February.
The difference is that the reduction in daily ranges is not associated with strong and well-supported trend behavior. Instead they show a market that has slowed substantially.
Volatility, momentum and trending activity have declined. The breakout, below or above, the trading band will set the next trend direction. The critical question is how the index behaves as it approaches resistance near 2,790.
Trade war threats have not turned the uptrend into a downtrend, but they have neutered all trending activity.
Daryl Guppy is a trader and author of Trend Trading, The 36 Strategies of the Chinese for Financial Traders, which can be found at www.guppytraders.com. He is a regular guest on CNBC Asia Squawk Box. He is a speaker at trading conferences in China, Asia, Australia and Europe. He is a special consultant to AxiCorp.
For more insight from CNBC contributors, follow @CNBCopinion on Twitter.
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1df3d4cd549d1d417cce324e8372adf8 | https://www.cnbc.com/2018/05/29/these-mistakes-can-ruin-your-dream-vacation-heres-how-to-avoid-them.html | These mistakes can ruin your dream vacation. Here's how to avoid them | These mistakes can ruin your dream vacation. Here's how to avoid them
Aleksandar Nakic | Getty Images
You've probably had that lingering feeling as you head out for a big trip: Am I forgetting something?
Chances are, you very well could be.
From passports that have expired to missing wallets to cell phones that do not work at your destination and other travel snafus, you could be caught off guard by the unexpected.
Travel experts weigh in on what you need to think about ahead of a big trip — and how to quickly regroup — when the unexpected happens.
Be sure to verify that you have your passport — and that it has not expired — well before your international trip.
Keep in mind that the expiration date on that document is misleading.
That is because you generally want to have a passport that is valid for at least six months from the date of your trip, according to Julie Hall, a spokeswoman at travel organization AAA.
If you need to renew your passport or apply for one, be sure to leave plenty of time. The process can take up to six weeks, Hall said.
It is possible to obtain expedited passports in some cities, such as New York, though those services may be harder to find in other locations, said Erika A. Richter, director of communications at the American Society of Travel Agents.
Not updating this key document could be a deal breaker if you arrive at the airport gate unprepared.
"That is a situation where you would have to have someone advocate on your behalf," Richter said. "If you're not insured, that's your whole vacation right there."
Be sure to make paper copies of all of the key documents and contents of your wallet before your leave.
Ideally, you want to leave a copy of these documents with a trusted family member or friend before you leave for your trip. Keep another copy with you, but separate from your actual wallet and passport while you travel.
"If you do lose it, you have it copied and ready to go and that makes that process a little smoother," AAA's Hall said.
Letting your bank or credit card company know that you are traveling ahead of time will prevent any hassles at your destination.
"They can put a note on your account so none of your charges get flagged and your credit card isn't declined," Hall said.
Likewise, you also want to make provisions for your cell phone so that your service isn't interrupted.
As more people travel, cell phone companies have started to offer different packages to accommodate them, Hall said.
"It's definitely worth calling and seeing what your options are," she said.
A major health scare at your destination that requires an emergency evacuation could cost you $100,000 or more if you are not covered by insurance, according to Megan Cruz, executive director at the US Travel Insurance Association.
"The wise thing to do is to think about all of the things that can go wrong and think about if you could afford the out-of-pocket expense for them," Cruz said.
The right travel insurance will help cover those medical emergencies and other unexpected developments.
The best way to find the right insurance for you is to shop around, said Richter at the American Society of Travel Agents.
There are many varieties of coverage depending on when you're traveling and how long you're staying, among other variables.
"It's always that one scenario where you think everything's going to be fine and you really wish you had protected your investment," Richter said. "Your vacation time is an investment."
VIDEO2:4902:49Does vacation make you more productive?CNBC Explains
Download the mobile app for your airline to keep tabs on your flight status in case of delays or cancellations. "A lot of times if you go on their app and tweet them, you can get quicker service," said Hall at AAA.Work with a travel agent. Booking your trip through a professional will not only help you if you encounter problems along the way, but can help you find better deals. "A lot of the costs, if they do add a fee, can be recouped and then some," Hall said.If you are traveling abroad, sign up for the State Department's Smart Traveller Enrollment Program, which lets U.S. citizens and nationals share their travel plans with the nearest U.S. embassy or consulate.
More from Personal FinanceHalf of Americans aren't taking a summer vacation. Here's why How to make sure your summer vacation won't wreck your financesFind out whether you're prepared to handle this hurricane season
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b296115769355d5e50bcd8ff90185664 | https://www.cnbc.com/2018/05/29/us-mexico-wall-mexican-president-enrique-pena-nieto-responds-to-trump.html | 'Mexico will NEVER pay for a wall,' country's president tells Trump | 'Mexico will NEVER pay for a wall,' country's president tells Trump
President Donald Trump meets Mexico's President Enrique Pena Nieto during the their bilateral meeting at the G20 summit in Hamburg, Germany July 7, 2017.Carlos Barria | Reuters
Mexico will "never" pay for a wall that separates its border from the United States, Mexican President Enrique Pena Nieto said Tuesday.
The North American country won't ever finance such a project, Nieto said in a tweet addressed to President Donald Trump.
Nieto tweet: President @realDonaldTrump: NO. Mexico will NEVER pay for a wall. Not now, not ever. Sincerely, Mexico (all of us).
Speaking at a rally earlier in the day, the U.S. leader had said the neighboring nation would eventually foot the bill for a border wall that he claims will stymie illegal immigration into the U.S.
It's not the first time Nieto has denied the idea.
In 2016, he penned a similar tweet and earlier this year, he postponed plans to visit the White House after an argument with Washington over the matter.
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0994f02116b1298a9fba5e8de181153c | https://www.cnbc.com/2018/05/30/cars-com-shares-leap-after-report-the-company-hired-j-p-morgan-to-explore-a-potential-sale.html | Cars.com shares leap after report the company hired JP Morgan to explore a potential sale | Cars.com shares leap after report the company hired JP Morgan to explore a potential sale
Source: Cars.com
Shares of Cars.com jumped 8.8 percent Wednesday after a report the online car retailer hired J.P. Morgan to explore a possible sale.
Shares rose 1 percent in after-hours trading.
The New York Post reported Wednesday afternoon, citing a source, that Cars.com has hired J.P. Morgan to explore strategic options that include a potential sale of the company. The source said a sale looks likely, at possibly $40 a share.
Cars.com has a $1.9 billion market value and closed at $26.59 a share Wednesday, down 7.8 percent for the year.
In March, the company said its board would add two directors supported by activist investor Starboard Value. Starboard is the second-largest investor in Cars.com and had a 9.4 percent stake in outstanding shares as of March 31, according to FactSet.
Representatives for Cars.com and J.P. Morgan did not immediately respond to a CNBC request for comment.
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9220730336da37f80a62a5a75347589b | https://www.cnbc.com/2018/05/30/china-is-reportedly-looking-to-align-with-other-countries-in-trade-war.html | China reportedly lining up countries against US in pending trade war | China reportedly lining up countries against US in pending trade war
VIDEO0:5800:58China versus US in pending trade warNews Videos
China is reportedly looking to line up other countries against the U.S. in a pending trade war after the White House took an unexpected move forward on tariffs a day earlier, the Wall Street Journal said Wednesday, citing Chinese officials.
On Tuesday, the White House announced it would have a final list of $50 billion in imports that would be subject to 25 percent tariffs by June 15, and two weeks later would announce investment restrictions on Chinese acquisitions of U.S. technology.
In response, China is reportedly looking to line up countries against the U.S., the Journal reported. The countries in question are mostly in Europe and Asia, where companies could benefit from China's plans to give foreign companies more open access to its markets.
Tuesday's announcement came just days after the two countries announced a tentative solution.
VIDEO4:5304:53No trade war with China but no trade peace either, analyst saysSquawk on the Street
U.S. Treasury Secretary Steven Mnuchin had said any trade war would be put on ice while negotiators worked out the details. As part of that deal, China would reduce its trade advantage by buying more U.S. goods such as agricultural and energy commodities. U.S. Commerce Secretary Wilbur Ross is set to arrive in Beijing Saturday but the surprise move from Washington could be an impediment to those talks, and is "casting doubt" over whether they can advance to the next level, the Journal reported.
Read the entire Wall Street Journal report here.
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60f032fa0411ceca8c886710de8220f0 | https://www.cnbc.com/2018/05/30/cramer-5-reasons-the-stock-market-rebounded.html | VIDEO0:5900:59Why the market rebounded: 5 reasonsMad Money with Jim Cramer
The stock market rebound on Wednesday was yet another example of panic being replaced by rationality, CNBC's Jim Cramer said.
"We forget why people fled from high quality stocks in droves yesterday, even stocks that had nothing to do with Italy," the "Mad Money" host said. "For the record, that's pretty much every American company having nothing to do with Italy, aside from a handful of players."
The Dow Jones industrial average rose 306.33 points, or 1.26 percent, closing at 24,667.78. The ended 1.27 percent higher and the Nasdaq composite rose nearly 0.9 percent. The action followed Tuesday's selloff on concerns about Italy's political uncertainty.
The euro zone's third-largest economy has been without a government since an inconclusive vote in March. On Sunday, President Sergio Mattarella refused to accept the nomination of a euroskeptic candidate for economy minister. Instead, he appointed former International Monetary Fund (IMF) official Carlo Cottarelli as interim prime minister, rattling global markets.
Cramer believes there are five reasons the market came back on Wednesday.
If you listened to the bears on Tuesday, it sounded like Wall Street was located in Rome, Cramer said.
However, "anyone who thinks that Italy is a functioning state with a real live banking system is kidding themselves," he said.
Italians want a better government and solvent, competitive banks, he added. But more importantly, they are "sick and tried" of a strong euro, which hurts the tourism business.
"That's the cause of the latest fracas: Italy loses far more than it gains from the euro—I think they'd be better off with their own currency—and they really don't like the EU's heavy-handed approach to just about everything," said Cramer.
Because of the strength of the U.S. economy, investors are "getting some incredible returns from great American companies that do most of their business domestically," the Mad Money host said
"Selling these stocks because of Italian woes is just as stupid as selling them because of the credit rating of New Jersey or Illinois."
The United States is "booming" in part because of its natural resource base, Cramer said.
While it's more concentrated in certain states not as spread out across the country as he'd like, it explains why the employment situation is robust, he added.
Doing business overseas requires navigating through a dense "thicket" of regulations. However, things are easing up in the U.S., Cramer said.
"Now that the Trump administration is slashing regulations left and right, or at least taking a very hands off attitude for enforcing the rules it can't get rid of, America has become an even easier place to hire people and grow your business."
What got Cramer so upset on Tuesday was that many combined the problems of Italy's banking systems with that of the U.S.
"There is one similarity: they both involve capital. But that's where the similarity ends because most Italian banks — and European banks for that matter — are radically undercapitalized, while our banks are insanely overcapitalized," he explained.
Wednesday's action was proof that selling on a European pullback is a mistake, said Cramer.
"America is not Italy. New York is not Rome. Our banks are not their banks," he said.
"It's easy to remember this stuff when we're rallying like today, but please try not to forget the next time we get slammed off of something that has nothing to do with the United States."
VIDEO12:5912:59Cramer: 5 reasons the stock market reboundedMad Money with Jim Cramer
Questions for Cramer? Call Cramer: 1-800-743-CNBCWant to take a deep dive into Cramer's world? Hit him up! Mad Money Twitter - Jim Cramer Twitter - Facebook - Instagram - VineQuestions, comments, suggestions for the "Mad Money" website? madcap@cnbc.com
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5ed5cebf326f8640fd77f1d5abeccd90 | https://www.cnbc.com/2018/05/30/european-stocks-italian-crisis-batters-global-financial-markets.html | European stocks close slightly higher amid concerns of political turmoil in Italy | European stocks close slightly higher amid concerns of political turmoil in Italy
European markets closed slightly higher Wednesday, as concerns of a political crisis in the euro zone's third-largest economy eased.
The pan-European Stoxx 600 closed provisionally up almost 0.3 percent, with sectors mixed and most major bourses in positive territory.
Among national indexes, Italy's FTSE MIB bounced back 2 percent higher after registering sharp losses in recent days. Italy's political woes have roiled global financial markets amid news the prospect of snap elections in Rome could be framed as a de facto referendum on the country's role in Europe.
Looking at individual stocks, Vivendi tumbled close to the bottom of the European benchmark Wednesday after the French media giant lost out on rights to broadcast domestic soccer matches. The setback was thought to highlight the lack of growth prospects for Vivendi's Canal Plus TV arm. Shares of the firm were off more than 3.6 percent on the news.
British discount retailer B&M was among Europe's top performers after reporting a 25 percent rise in full-year profit on Wednesday. Shares of the firm rose 4.5 percent.
Meanwhile, Germany's Bayer rose almost 4 percent as traders monitored news that the U.S. Department of Justice cleared the way for approval of its $66 billion acquisition of Monsanto.
On Wall Street, stocks traded higher, rebounding after a drop in the previous session due to political uncertainty surrounding Italy.
Developments in Italy remained in the spotlight Wednesday. Investors were fearful that euroskeptic parties in Rome could frame a new election as a de facto referendum on Italy's role in Europe.
Reuters reported Wednesday that Italian parties were seeking "a point of compromise on another name" for the position of economy minister, citing a source close to the Five Star Movement. Sergio Mattarella, the country's president, vetoed Five Star and Lega's pick for economy minister over the weekend.
Italy has been without a government since an inconclusive vote in early March, with the president finally nominating former International Monetary Fund official Carlo Cottarelli as interim prime minister until a snap poll is held sometime between September and spring 2019.
An auction of Italian bonds went through smoothly on Wednesday. The country sold 5.57 billion euros ($6.47 billion) in government debt.
On the data front, a euro area sentiment survey for May showed a fall to 112.5 from 112.7 in the previous month.
In Germany, the consumer price inflation rate surged to 2.2 percent in May, above the European Central Bank's target of below, or close to, 2 percent.
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bb2effe2c816d9dd8693c3f36068e0a0 | https://www.cnbc.com/2018/05/30/legas-salvini-call-for-fresh-election-takes-gloss-off-italian-recovery.html | Lega leader’s call for fresh election takes gloss off Italian recovery | Lega leader’s call for fresh election takes gloss off Italian recovery
Matteo Salvini leader of Lega Nord party speaks during the Lega Nord demonstration in Piazza Duomo on February 24, 2018 in Milan, Italy.Pier Marco Tacca | Getty Images Europe
A recovery in Italian stocks has been slowed by news that the leader of the right-wing Lega party has called for a new election.
Matteo Salvini said Wednesday that he wanted new elections in Italy "as soon as possible."
Salvini added that holding a fresh vote in late July would be disruptive for many Italians, but he noted that "the earlier we vote, the better, because it's the best way to get out of this quagmire and confusion."
had been in full recovery mode in early trading Wednesday after reports that Prime Minister-designate Carlo Cottarelli has been holding further talks with President Sergio Mattarella about a new technocratic government.
Assets were also boosted by reports that the populist Five Star Movement (M5S) was re-igniting talks to form a coalition with Lega. The two parties failed in their first attempt at the weekend when Mattarella rejected the appointment of an 81-year-old euroskeptic as their proposed finance minister.
Italy's President Sergio Mattarella talks to journalists after Italy's designated Prime Minister Giuseppe Conte returned the mandate to form a new government, on May 27, 2018 in Rome, Italy.Alessandra Benedetti | Corbis | Getty Images
The FTSE MIB in Milan see-sawed in Wednesday morning trade and at around 1 p.m. CET (7 a.m. ET) was up by around 1.3 percent. Italy's top stocks had slipped more than 4 percent this week, before the start of Wednesday trade.
The Italian bond market has steadied after the politically sensitive two-year yield recorded its biggest spike since 1992 amid concerns over a fresh election. The yield opened at 2.73 percent on Wednesday and rose to 2.91 before falling to trade at around 1.78 percent at 1 p.m. CET. Prices move inversely to yield.
The Democratic Party in Italy has also urged President Mattarella to send the country straight back to the polls, insisting that it would not back a technocratic government led by Cottarelli.
Speaking to CNBC on Wednesday, Sandro Gozi, Democratic Party member and deputy secretary of state for political and European affairs, said it was time to end the confusion created by Lega and M5S.
"One day they want elections, one day they want to impeach Mattarella and the next they want to work with Cotarrelli. Uncertainty is always bad and the sooner we get political clarification, the better," he said.
VIDEO1:1901:19Italian lawmaker: Germany has responsibility for the current state of the EUStreet Signs Europe
Gozi also took a swipe at outside influence, claiming that the Italian political crisis was "mainly due" to ineffective European policy. The democratic politician, normally considered a pro-European voice, was particularly critical of Germany.
"It is time for fundamental European reform and the first one to understand this must be our German friends in Berlin. Germany has huge responsibility for the state of Europe today because Berlin has always postponed the reform which was urgently needed," he said.
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85ad74c43a518976ed4cd6e90fb20d96 | https://www.cnbc.com/2018/05/30/lowes-bans-paint-strippers-after-protest-campaign.html | Lowe's bans paint strippers after protest campaign | Lowe's bans paint strippers after protest campaign
An employee works in the paint department at a Lowe's store in Louisville, Kentucky.Luke Sharrett | Bloomberg | Getty Images
Lowe's is banning paint strippers with two harmful chemicals after activists waged a campaign against the home improvement retailer over its sale of the products.
Paint removal products with methylene chloride and NMP will be off Lowe's shelves by the end of the year.
"We care deeply about the health and safety of our customers, and great progress is being made in the development of safer and more effective alternatives," said Mike McDermott, Lowe's chief customer officer, in a statement. "As a home improvement leader, we recognize the need for viable paint removal products and remain committed to working closely with suppliers to further innovate in this category."
An activist group called Safer Chemicals, Healthy Families, which had campaigned for such a move, hailed the decision and described Lowe's as the first major U.S. retailer to do so.
The group, which organized protests outside Lowe's stores, said more than 200,000 consumers had signed petitions "demanding action." The organization called for competitors, including Home Depot, Walmart and Menards, to follow suit.
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"When facing federal inaction on vital issues facing the American public — some of which are matters of life or death — retailers have a responsibility and an opportunity to do right by their customers," said Mike Schade, Mind the Store campaign director for Safer Chemicals, Healthy Families, in a statement. "Lowe's has set the pace for the rest of the retail sector with its announcement today. The company's actions will also help drive the development of safer green chemistry solutions."
Methylene chloride has been tied to cancer, reproductive issues and other conditions, according to Safer Chemicals. The Environmental Protection Agency in 2017 proposed a ban that has yet to become law.
NMP, or N-methylpyrrolidone, is cited as a cause of fetal development problems, including miscarriages, Safer Chemicals said.
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6c9f4c3a956734981c3e2720dfb3e074 | https://www.cnbc.com/2018/05/30/michael-cohens-lawyers-accuse-michael-avenatti-of-leaking-bank-docs.html | Michael Cohen's lawyers accuse Stormy Daniels' attorney of 'drive-by shooting' in bank record dump | Michael Cohen's lawyers accuse Stormy Daniels' attorney of 'drive-by shooting' in bank record dump
Michael Cohen, personal lawyer to U.S. President Donald Trump, arrives at federal court in New York, U.S., on Wednesday, May 30, 2018.Peter Foley | Bloomberg | Getty Images
An attorney for Michael Cohen, President Donald Trump's personal lawyer, on Wednesday accused porn star Stormy Daniels' attorney of an "intentional, malicious and prejudicial" release of Cohen's bank records.
Cohen's lawyer, Stephen Ryan, accused the porn star's representative, Michael Avenatti, of staging a "drive-by shooting of my client's rights" by releasing the information.
Avenatti responded to Cohen, saying he and his client "did not do anything improper relating to the release of any information concerning Mr. Cohen."
VIDEO7:5607:56The Trump-Russia ties hiding in plain sightDigital Original
The comments were made in Avenatti's presence in Manhattan federal court, as part of a case currently sorting out which materials seized from Cohen in FBI raids last month are protected by attorney-client privilege.
The judge in that case, Kimba Wood, adjourned the Wednesday hearing after setting a June 15 deadline for Cohen's team of lawyers to complete their review of the seized materials. If the lawyers miss that deadline, Wood said a separate group of government lawyers, known as a "taint team," will take over to review the remainder.
Lawyers for Cohen said that about 3.7 million files in total needed to be evaluated for privilege status, and that they had thus far reviewed about 1.3 million of them.
Avenatti, a California-based lawyer, is attempting to represent Daniels in the New York case involving Cohen. Lawyers for Cohen have argued that Wood should not permit Avenatti to intervene in this instance. Ryan, in opposing Avenatti's request for admission, noted the lawyer has made 170 media appearances in recent months.
Cohen appeared in court Wednesday, though he said nothing during the proceeding aside from inaudible whispers to his lawyers.
Earlier in May, Avenatti published a report alleging payments made to Cohen's company, Essential Consultants, from large corporations including telecommunications giant AT&T and drug company Novartis, among others. Those companies both said in subsequent statements that they paid Cohen's company.
Lawyers for Cohen had questioned in a previous court filing how Avenatti could have obtained the information, which appeared to be drawn from bank records known as "suspicious activity reports."
"Mr. Avenatti has published some information that appears to be from Mr. Cohen's actual bank records, and Mr. Cohen has no reason to believe that Mr. Avenatti is in lawful possession of these records," the filing said.
Ryan, in court on Wednesday, called Avenatti's conduct reckless, intentional and malicious. "I've never seen an attorney conduct himself the way Mr. Avenatti conducted himself," Ryan said. "What Mr. Avenatti did in releasing those records was entirely improper," he added.
In an earlier tweet on Wednesday, Avenatti suggested that Cohen is leaking "illegally recorded conversations" related to Daniels.
Avenatti tweet
At the U.S. district courthouse on Wednesday, Avenatti said he was contacted recently by a reporter with a recording he believes was made by Cohen.
"From what I understood there were audio recordings" between Cohen and Daniels' former lawyer, Keith Davidson, "regarding attorney-client privilege," Avenatti said.
Davidson was Daniels' attorney at the time she received $130,000 from Cohen through Essential Consultants as part of a nondisclosure deal barring her from discussing an alleged affair with Trump from years earlier.
After the payment, which was made a few weeks before the 2016 election, Trump reimbursed Cohen in 2017, according to his financial disclosure form. Daniels, whose real name is Stephanie Clifford, is now suing Trump and Cohen to void the hush deal.
Ryan did not deny that such audio tapes existed, but appeared to cast doubt on Avenatti's accusation that a tape had been leaked.
"If we had released the audiotape to a reporter, it would have been the biggest story," Ryan said.
After the hearing, Avenatti said outside the courthouse that Ryan "admitted that there are audio recordings that Michael Cohen was taking," and that they not only exist but "are under lock and key."
Avenatti called on Cohen and his attorneys to release the alleged recordings to Congress and the public.
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941a8bb8a6ea35e2c96626a65d77f2ee | https://www.cnbc.com/2018/05/30/michael-kors-forecasts-annual-profit-largely-below-estimates.html | Michael Kors forecasts annual profit largely below estimates | Michael Kors forecasts annual profit largely below estimates
A shopper looking at Michael Kors handbags in Macy's flagship store in New York.Scott Mlyn | CNBC
Michael Kors forecast yearly earnings largely below Wall Street estimates, taking the shine off stronger-than-expected quarterly results and driving the handbag maker's shares down 7 percent on Wednesday.
The company known for its Mercer and Hamilton handbags expects earnings of between $4.65 and $4.75 per share in fiscal year 2019, pointing to a lower figure than analysts' average expectation of $4.74, according to Thomson Reuters I/B/E/S.
Kors, which bought luxury shoemaker Jimmy Choo last July, also said on Wednesday it would explore more acquisitions to boost its luxury offerings.
Net income attributable to Kors was $44.1 million or 29 cents per share in the fourth quarter ended March 31, compared with a net loss of $26.8 million or 17 cents per share a year earlier.
Revenue rose to $1.18 billion from $1.06 billion, exceeding analysts' average estimate of $1.15 billion, according to Thomson Reuters I/B/E/S.
Excluding one-time items, the company earned 63 cents per share, topping analysts' estimates of 60 cents.
Shares of New York-based Michael Kors slid 6.8 percent to $63.60 in premarket trading.
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36392bdf1b9b018f724880958dceb002 | https://www.cnbc.com/2018/05/30/retirement-as-a-nomad-7-tips-from-airbnbs-oldest-interns.html | How to spend your retirement as a nomad: 7 tips from Airbnb's oldest interns | How to spend your retirement as a nomad: 7 tips from Airbnb's oldest interns
Traveling to countries like Kyrgyzstan, Romania and Cuba, staying on a strict budget and spending lots of time thinking about Airbnb – that sounds like the lifestyle of student travelers on a gap year.
In reality, it's the life of American couple Michael and Debbie Campbell, who have dubbed themselves "the senior nomads."
Debbie, who is 62, told CNBC in Singapore that the couple's daughter planted the idea in their heads in 2012 after seeing that her parents had a list of countries they wanted to visit.
While the Campbells were uncertain about whether they could afford to travel full time, their daughter suggested they could manage their accommodation costs by using Airbnb, an online platform for home sharing.
The couple, who had been living in Seattle, looked up Airbnb offerings in the places they wanted to visit, organized a budget and left Seattle six months later.
Now, they've been on the road for five years, visited more than 70 countries, stayed in more than 170 Airbnbs and even manage to blog regularly about their experience.
With their ample experience as guests, the couple managed to get internships at the tech company last September, becoming Airbnb's oldest interns.
While the Campbells are admittedly adventurous risk-takers, they didn't decide to retire and travel on a whim.
"Money was a concern," said Michael, who is 72, adding that they had a retirement nest egg that they needed to spend very carefully.
"I wondered at the beginning: Could we do this financially? Would we have the self-discipline not to spend money more than we should? And five years later, we're doing just fine."
Here are some of their tips on how to retire as senior nomads.
Before embarking on their journey, the couple did "a lot of spreadsheets."
They sold their cars, their boat and — two years later — their house.
The Campbells declined to disclose the cost of their entire lifestyle because they said they did not want to discourage anyone from trying it out.
"We're afraid people will say, 'I don't have that amount of money, I can't do it', but they can do it for less or more. They could focus on countries that are more affordable," said Michael.
However, they shared that they worked on their budget with a financial advisor and decided to spend an average of $90 a night on accommodation.
The couple said the key to staying on budget is "don't buy things."
That rule even applies to souvenirs, although they do buy gifts for others.
"We've gotten so bad that if I see a greeting card I want to give to Michael, I take a picture and show him the picture on my phone," Debbie said.
But many of their best experiences have come for free.
Debbie said the couple always tries to see the "free things" wherever they go because "that's the thing which locals see anyway."
They get tips from their Airbnb hosts about events going on, but they look for free concerts at churches, free exhibitions at museums, and they also enjoy checking out public libraries.
The couple also saves money on food by cooking many of their meals at home, going out for dinner just once or twice a week.
One of the key strategies the Campbells use to stay on budget is to write a journal entry every day.
Michael said that keeping track of their expenses had become a habit akin to brushing their teeth.
The couple takes turns writing about their experiences in their journals, and tapes their receipts in the journal to keep track of spending.
Debbie told CNBC she had been thinking to herself that "we've been gone five years, but I don't feel any older, but we are five years older than we left."
They credit their energy and stamina to "walking a lot."
"That's helped us with our health," she said, adding that they now walk a lot more than they used to in Seattle — where they drove more often.
Debbie and Michael said they watched the Robert De Niro movie "The Intern," and were so inspired by the tale of an older man finding purpose in his internship that they decided to ask Airbnb for a shot.
While the internship was unpaid, the couple said the experience made them feel "so vibrant."
"We couldn't wait to go to work, we stayed just as late as anyone else," said Debbie, who used to be a graphic designer.
Working alongside much younger people, the senior nomads started their own project called "Hug," which stands for "Help uplift guests." They worked on a guest recognition program that helped the tech company show greater appreciation to guests using the platform.
The couple said they found the internship to be fun, and recommended that older people refuse to accept the idea their life of contributing is over.
Most of all, though, they pushed for others to get out and explore.
"Travel is what you make it. You don't have to leave the country. Take a train as far as it goes and see what happens on the other end. Keep active, or your world could really shrink," said Debbie.
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af7d486d54fd01124067dc4e3a4c8525 | https://www.cnbc.com/2018/05/30/reuters-america-fx-settlement-provider-cls-invests-in-blockchain-consortium-r3.html | FX settlement provider CLS invests in blockchain consortium R3 | FX settlement provider CLS invests in blockchain consortium R3
NEW YORK, May 30 (Reuters) - Foreign exchange settlement provider CLS has invested $5 million in R3, the New York-based blockchain startup, CLS and R3 told Reuters on Wednesday.
CLS, which settles over $5 trillion of payment instructions a day for its members, will take a seat on R3's board of directors, the companies said.
The deal forms part of the third tranche of R3's fundraiser, which included investments from Singapore real estate firm OUE and Japanese IT services provider TIS, according to a person familiar with the matter.
OUE and TIS also invested $5 million each in R3, the person said. OUE and TIS did not immediately respond to requests for comment.
Blockchain, which first emerged as the software powering cryptocurrencies such as bitcoin, is a shared database of transactions that is maintained by a network of computers.
Financial institutions have been investing hundreds of millions of dollars in the technology, which they hope can help simplify and reduce the costs of processes such as securities settlement.
CLS's settlement members include more than 60 of the world's largest financial institutions such as JPMorgan Chase & Co and Citigroup.
"CLS is critically important to the functioning of one of the most important markets in the world," R3's chief executive officer, David Rutter, said in an emailed statement. "It is absolutely right that major infrastructure players like this look to technologies such as blockchain to continue making their products and services faster, easier, safer and more cost-effective for the end user."
Around a year ago R3 said it had completed the first two tranches of its fund-raising round, securing $107 million from more than 40 financial and technology companies, including Bank of America Corp, SBI Holdings Inc, HSBC Holdings Plc , Intel Corp and Temasek Holdings.
R3 launched in September 2015 with the backing of nine large investment banks, and its membership has grown to over 80 financial institutions.
The company has developed a type of blockchain called Corda and is testing it with various of its members.
"We look forward to working in collaboration with other members to explore how CLS can provide transformative blockchain-based solutions," Alan Marquard, chief strategy and development officer at CLS, said in an emailed statement.
While the R3 consortium has been growing, several banks have departed, including JPMorgan, Goldman Sachs Group Inc, Banco Santander SA and Morgan Stanley. (Reporting by Anna Irrera Editing by Leslie Adler)
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a06ecb5a2bec51735d5ebaa80a57c735 | https://www.cnbc.com/2018/05/30/rudy-giuliani-is-holding-qa-sessions-with-trump-to-prepare-for-interview-with-special-counsel.html | Rudy Giuliani is holding Q&A sessions with Trump to prepare for special counsel probe: NBC | Rudy Giuliani is holding Q&A sessions with Trump to prepare for special counsel probe: NBC
Rudy Giuliani, attorney for U.S. President Donald Trump, arrives for the White House Sports and Fitness Day event on the South Lawn of the White House in Washington, May 30, 2018.Leah Mills | Reuters
Rudy Giuliani is conducting question-and-answer sessions with President Donald Trump to prepare Trump for the special counsel's investigation, according to an NBC News reporter.
tweet 1
Giuliani, the former mayor of New York City who joined Trump's legal team in April, is preparing Trump by holding in-person and phone sessions with the president, according to the reporter.
The sessions are "to educate me" about what he can say that is not protected by attorney-client privilege, Giuliani also told the reporter.
tweet 2
Giuliani also touched on the alleged use of an FBI informant in Trump's campaign — a revelation Trump has fervently decried as a potential scandal.
Multiple outlets reported that an FBI informant spoke with multiple Trump campaign associates as part of the federal investigation of Russian election meddling. Giuliani told the reporter that he is not yet "satisfied" that the alleged use of an informant was proper, saying he had not seen related FBI documents.
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In a Washington Post interview on Tuesday, Giuliani tied the prospects for an interview between Trump and special counsel Robert Mueller's team to the alleged FBI informant.
"We need all the documents before we can decide whether we are going to do an interview," Giuliani told the Post.
Trump has repeatedly claimed that a "spy" was placed in his campaign for "political purposes," an accusation for which no evidence is publicly available.
Trump tweet 1
In remarks to reporters at the White House on Wednesday, Giuliani doubled down on the Sept.1 deadline he had previously floated as the time he expected Mueller to conclude his probe of potential coordination between the Trump campaign and Russia.
"If he doesn't file this report by September 1, mid-September, he's clearly doing a Comey," Giuliani said. He was referring to former FBI Director James Comey, who made statements about an investigation into former candidate Hillary Clinton's email server shortly before the 2016 election.
He added that Democrats "want to see the investigation stretch out past the next midterm elections," despite recent statements to the contrary from some Democrats.
The White House did not immediately respond to CNBC's request for comment.
VIDEO1:0701:07Giuliani says Russia probe may end by Sept. 1News Videos
Clarification: This story was updated to reflect additional comments and context from Giuliani.
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b7f8dbc70c48b205d3cd42a26bbd7763 | https://www.cnbc.com/2018/05/30/singapore-airlines-to-launch-worlds-longest-flight--to-new-york.html | Singapore Airlines to launch world's longest flight | Singapore Airlines to launch world's longest flight
Singapore Airlines has announced it will launch the world's longest non-stop flight route in October, using an aircraft that offers no economy class.
The airline will begin a once-daily journey in both directions between Singapore's Changi Airport and Newark Liberty Airport, which serves New York City.
The first flight takes off on October 11 and will travel more than 9,500 miles to New York, according to the airline's press release. Singapore said the journey should take just shy of 19 hours.
The aircraft, an Airbus A350-900ULR, will feature 67 business class and 94 premium economy seats.
Singapore Airlines said non-stop Singapore-Los Angeles flights are also planned, with details to be announced at a later date.
With long-haul planes getting ever more efficient, CNBC takes a look at the current routes guaranteed to wear out any hardened traveler.
Shortest total time: 16 hours, 50 minutesLength: 8,578 miles
Yury Prokopenko | Getty Images
Operated by Qantas, this flight was the first non-stop on the route, when the Australian airline started using an Airbus A380 in 2014. The return route from Sydney, however, was already non-stop, and began in 2011.
Shortest total time: 17 hours, 30 minutesLength: 8,596 miles
Houston, TexasTim Leviston | EyeEm | Getty Images
United Airlines began UA101 in January this year, using Boeing's 787-9. Crossing the International Date Line across the Pacific Ocean, travelers arrive two days after departure.
Shortest total time: 17 hours, 00 minutesLength: 8,770 miles
A Boeing 787 Dreamliner operated by United Airlines takes off from Los Angeles International Airport.Getty Images
United first operated this service in October 2017. The flight holds the distance record for any current flight flying to or from the U.S. That should change when Qantas launches nonstop flights between Melbourne and San Francisco in September.
Shortest total time: 17 hours, 05 minutesLength: 8,824 miles
An Airbus A380 in Emirates livery.Airbus
Emirates EK449 is a non-stop Airbus A380 route. After departing New Zealand it is almost four hours before you even reach the east coast of Australia. Anyone who stays awake should be able to see the south coast of India before the descent into the Middle East.
Shortest total time: 17 hours, 20 minutesLength: 9,010 miles
The newest Boeing 787-9 Dreamliner for Sydney, Australia-based Qantas features artwork honoring Aboriginal and Torres Strait Islander Australians.Source: Qantas
In March, the Boeing 787-9, operated under Qantas' QF9 code, became only one of two current routes to fly direct more than 9,000 miles. The Dreamliner sets off on its non-stop run to London at 6.50 p.m. AWST, reaching Heathrow at 5.10 a.m. London time the following day.
Shortest total time: 17 hours, 40 minutes Length: 9,032 miles
A Qatar Airways Boeing 777 In New York.Leslie Josephs | CNBC
The longest current flight you can take flies you from New Zealand to the capital of Qatar. A Boeing 777-200LR performs the haul, which was first completed in February 2017.
WATCH: Here's how and why airlines bump passengers
VIDEO1:4201:42Here’s how and why airlines bump passengersDigital Original
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e50375ea018e31498c39559ca3a4c0c4 | https://www.cnbc.com/2018/05/30/stocks-making-the-biggest-moves-premarket-dks-tgt-crm-hpq-nvo-kors-more.html | Stocks making the biggest moves premarket: DKS, TGT, CRM, HPQ, NVO, KORS & more | Stocks making the biggest moves premarket: DKS, TGT, CRM, HPQ, NVO, KORS & more
VIDEO0:5600:56Futures pointing to a rebound for Wall StreetMarkets
Check out the companies making headlines before the bell:
Dick's Sporting Goods – The sporting goods retailer beat forecasts by 7 cents a share, with adjusted quarterly profit of 52 cents per share. Revenue also came in above forecasts. Comparable-store sales fell more than expected, but Dick's also raised its full-year outlook largely above Street's forecast.
Target – Bank of America/Merrill Lynch added the retailer's stock to its US 1 List, noting a number of initiatives that it feels will drive comparable-store sales higher.
Salesforce.com – Salesforce reported adjusted quarterly profit of 35 cents per share, beating estimates by 2 cents a share. Revenue also topped forecasts and the company raised its full-year forecast on continued strong demand for its cloud-based sales and marketing software.
HP Inc. – HP matched estimates with adjusted quarterly earnings of 48 cents per share. The computer and printer maker's revenue beat Street forecasts and HP Inc. raised its forecast for the full year. Separately, the company named Steve Fieler as its new chief financial officer, replacing Cathie Lesjak who will become interim chief operating officer.
Novo Nordisk – The European drugmaker said its oral diabetes drug did better in a study at lower blood sugar levels than competitor Jardiance, a treatment made by Boehringer Ingelheim and Eli Lilly.
Michael Kors – The luxury goods retailer earned an adjusted 63 cents per share for its latest quarter, 3 cents a share above estimates. Revenue topping forecasts, as comparable-store sales rose 2.3 percent, versus an expected drop. The company's earnings forecast of $4.65 to $4.75 per share fell largely below the consensus estimate of $4.74 a share.
DSW – The shoe retailer reported adjusted quarterly profit of 39 cents per share, 2 cents a share above estimates. Revenue and comparable-store sales also exceeded forecasts. However, DSW left its full-year forecast unchanged at $1.52 to $1.67 per share, compared to the consensus estimate of $1.63 a share.
Movado Group – The watchmaker and distributor reported quarterly profit of 37 cents per share, well above the 11 cents a share consensus estimate. Revenue beat estimates by a wide margin and Movado raised its full-year outlook.
Royal Bank of Scotland – The bank announced the resignation of its finance chief Ewen Stevenson. The surprise departure came on the day of the bank's annual meeting.
Walmart – The retail giant will begin its two-day annual meeting Wednesday in Bentonville, Arkansas.
CBS – CEO Leslie Moonves is accused by controlling shareholder Shari Redstone in a court complaint of threatening to resign, unless directors voted to strip the Redstone family of voting control.
Amazon.com – Amazon announced an expansion of savings available to Prime members at its Whole Foods supermarkets, making those savings available at an additional 121 locations across 12 states. Today is also the day of Amazon's annual meeting.
WellCare Health Plans – The health plan operator is buying pharmacy benefits manager Meridian for $2.5 billion in cash. Meridian operates in Illinois and Michigan, and is the leading Medicaid provider in Michigan.
AbbVie – The drugmaker was downgraded to "underperform" from "neutral" at Credit Suisse, amid concerns about AbbVie's best-selling Humira drug. The firm notes the upcoming entry of multiple biosimilars coming on the market that will erode Humira's sales.
Exxon Mobil – Exxon Mobil was upgraded to "outperform" from "sector perform" at RBC Capital, which points to potential dividend growth as well as superior returns.
KKR – The private-equity firm will reportedly pay $8.3 billion to buy privately held BMC Software, according to the New York Post. The deal was announced Tuesday morning, but terms were not disclosed.
G-III Apparel – The apparel maker was upgraded to "outperform" from "market perform" at Cowen, which thinks that current Street earnings forecasts are too conservative given expanding profitability at Donna Karan among other factors.
Polaris Industries – The recreational vehicle maker is buying privately held Boat Holdings – the leading U.S. manufacturer of pontoon boats – in an all-cash transaction valued at $805 million. Polaris will pay $705 million and will accrue about $100 million in net tax benefits.
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92ff10cb9390dd2a1bbcb0de3717f6ce | https://www.cnbc.com/2018/05/30/tesla-model-3-gets-consumer-reports-recommendation-after-braking-update-shares-hit-session-high.html | Tesla Model 3 gets Consumer Reports recommendation after braking update; shares hit session high | Tesla Model 3 gets Consumer Reports recommendation after braking update; shares hit session high
VIDEO1:1801:18Consumer reports reverses Tesla Model 3 opinionHalftime Report
Consumer Reports said Wednesday it now recommends the Tesla Model 3, reversing an earlier decision over the car's long stopping distance and other issues. The group said Tesla's ability to fix the issue with a remote software update was a first for a carmaker.
Tesla improved the car's braking distance by about 20 feet through a remote software update, placing the car within the typical stopping distance for its class, the group said. Consumer Reports had previously said the Model 3 had the longest stopping distance of any contemporary car it tested, including the much larger Ford F-150 full-size pickup.
It is not unusual for an automaker to make changes to a vehicle in response to criticism from Consumer Reports, but it is unique that Tesla was able to address this problem with an over-the-air update, Consumer Reports director of automotive testing Jake Fisher told CNBC.
"This really is an industry first," Fisher said.
Tesla CEO Elon Musk said on Twitter that he appreciated the criticism, and that improvements addressing the group's other complaints are forthcoming.
Musk
Musk2
Fisher had said the group would recommend the Model 3 if Tesla solved the braking issue, but in its updated review the group still had other issues with the car, such as wind noise, stiff ride, and uncomfortable rear seat. Musk told Consumer Reports that Tesla was making changes to its production line to eliminate those problems. The group will rent another car from Tesla to see if those changes make a difference.
"The change to the brakes is enough it recommend it, but it is certainly not at the top of its category and there is definitely room for improvement," Fisher said.
Shares of Tesla were up nearly 2 percent on the news. The stock is on pace for its third straight day of gains for the first time since Apr 5th. Shares are still 26 percent below their all-time high of $389.61, set on September 18, 2017.
Read the full story at Consumer Reports.
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b9aced726ab4901ceaac70bc0aafcaa8 | https://www.cnbc.com/2018/05/31/a-blockchain-start-up-just-raised-4-billion-without-a-live-product.html | A blockchain start-up just raised $4 billion without a live product | A blockchain start-up just raised $4 billion without a live product
Brendan Blumer, CEO, Block.OneSource: Block.one
A Cayman Islands start-up has raised $4 billion as of Thursday, eclipsing the world's biggest initial public offerings on stock exchanges this year. But its flagship product is not even live yet.
Block.one is funding its blockchain platform called eos.ios through a process known as an initial coin offering, or ICO. Its multibillion-dollar fundraising effort more than doubles the next biggest offering of that type. But investors still don't know how the majority of that capital will be used.
Many have been pouring in money based on hype and a promise that its founders, who have run other well-known blockchain projects, can repeat their success.
Through the ICO, Block.one is offering a cryptocurrency called eos. Unlike an IPO, which gives investors stock ownership in a company, an ICO gives out tokens whose use case is based on a promise the platform will be useful in a digital network once it gets built.
VIDEO3:1303:13How to start your very own cryptocurrencyDigital Original
Participants in the ICO used cryptocurrency ether instead of U.S. dollars in exchange for the new eos tokens. The fundraising brought in 7.12 million in total ether as of Wednesday night, according to Token Report, a division of blockchain advisory firm New Alchemy. At Thursday's U.S. dollar exchange rate of $576 per ether, the ICO has brought in the equivalent of $4.1 billion. This amount could change depending on the price of ether once the sale closes.
In a March episode of "Last Week Tonight," talk show host John Oliver highlighted eos in a monologue warning viewers about the "speculative mania" and risks of investing in cryptocurrency.
"It can be incredibly hard to tell which companies are for real," Oliver said during the episode, which has 5.98 million views on YouTube. "If you want a good example of this, look at Block.one, which has raised $1.5 billion."
"It hasn't launched yet," Oliver said. He listed a host of concerns: the apparent lack of seriousness by advisor and noted early bitcoin investor Brock Pierce, the exponential pace of fundraising relative to established tech giants such as Facebook, and a Wall Street Journal report that called eos "a software startup that doesn't plan to sell any software."
The system, according to its founders, will support more efficient operations for "decentralized applications" than existing platforms such as ethereum. If eos.ios is successful, advocates say it could bring on much greater adoption of cryptocurrency-related technology. But they still have a lot to prove when the product goes live June 1.
"They have set the bar very high for themselves in terms of delivery expectations," said William Mougayar, managing partner at JM3 Capital and author of "The Business Blockchain." "Now is the time to not just deliver the coins but the technology with it."
Mougayar called Block.one an anomaly, on the "extreme" side of the fundraising spectrum. The biggest IPO this year, AXA Equitable Holdings, raised $2.8 billion in its May 10 offering, while ADT raised $1.5 billion in January, according to data from Pitchbook.
Cryptocurrency prices have sputtered this year. Bitcoin, for example, has lost more than 45 percent of its value in 2018 after rising more than 1,300 percent last year, according to CoinDesk. But investors are still betting on coin offerings, despite some being pegged as frauds.
The group behind messaging app Telegram raised $1.7 billion through private investors but canceled its public cryptocurrency sale this year. ICOs raised $6.6 billion in 2017 and have hit $9.1 billion this year, according to research firm Autonomous Next.
"This is the crypto world we live in," Mougayar said. "The eos founders have done a great job at marketing their technology, ahead of its delivery."
Telegram Open Network — $1.7 billionDragon Coin — $320 millionHuobi — $300 millionHDac — $258 millionFilecoin — $257 millionTezos — $232 millionSirin Labs — $157.9 millionBancor — $152 millionBankera — $150.9 millionPolkadot — $142.4 million
Source: New Alchemy
Other pundits say faith in Brendan Blumer, the company's CEO, and Dan Larimer, its chief technology officer, are the reason investors trust that the start-up will deliver. Larimer has founded two high-profile crypto companies, Bitshares and Steemit.
"Dan is among the most accomplished blockchain developers on the planet," said Kyle Samani, managing partner at Multicoin Capital, which is an investor in eos. "He's well respected in the space and well-accomplished."
Similar to how Apple's iOS and Google's Android have battled it out for operating system dominance, blockchain companies could be entering a dogfight. Companies are competing to have developers use their code to build what are known as "decentralized" applications. But this competition will have at least 10 companies instead of two and "it's going to be much messier," Samani said.
"In this market, the answer is raise as much money as possible," he said. "It's plausible that we look back and say the team that spent the most money won the tech war."
Having the amount of capital Block.one does could give the platform a leg up, even if the launch this weekend is rocky. The company has already said it will spend $1 billion of its bounty recruiting developers, with billions more to hypothetically spend on lobbying global regulators and building relationships with banks.
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fc172625ae9d7fea3e3223a16e562c6b | https://www.cnbc.com/2018/05/31/alibaba-joe-tsai-claims-many-americans-want-to-stop-china-from-upgrading-its-tech.html | Alibaba co-founder claims many Americans 'want to stop China' from upgrading its tech | Alibaba co-founder claims many Americans 'want to stop China' from upgrading its tech
Alibaba Co-Founder and Executive Vice President Joe Tsai speaking at the 2018 Code Conference.Asa Mathat | Vox Media
An Alibaba co-founder alleged on Wednesday that many Americans want to stop China from upgrading its technology and from becoming more innovative.
Joe Tsai, who co-founded the tech juggernaut and is an executive vice president there, made that claim at a conference in California in response to a U.S. senator saying earlier at the event that Chinese tech firms may serve as agents of Beijing.
Those competing claims come amid the on-again off-again trade tensions between the U.S. and China. American officials allege that Chinese companies have thrived on innovations stolen from U.S. firms. And, on Tuesday, officials said they may yet impose tariffs on $50 billion of imports from China unless Beijing addressed the theft of American intellectual property.
VIDEO2:4302:43Alibaba's Joe Tsai: We're looking long-term, beyond 'trade war blip'Closing Bell
In response, China said it was both surprised and saw the move as contrary to an agreement reached by both sides recently — and that it was ready to fight to protect its own interests.
The U.S. has also said that China often forced American companies looking to enter the Chinese market to transfer their technology to local state-owned or state-directed firms. Beijing has rejected those claims and said its regulatory measures do not require transfers from foreign companies.
In fact, Chinese media outlets have repeatedly asserted that American complaints about the tech sector are really just efforts to slow the country's rise as a global power.
"There's nothing wrong with a country wanting to upgrade its own manufacturing sector, go higher tech, be more innovative," Tsai said. "But then, from the Chinese perspective, what we're seeing is there are a lot of people in America that want to stop China from doing that."
After three decades of producing low-end manufacturing goods, Tsai said, China recognizes the need to develop better technology, upgrade its manufacturing sector and focus more on value-added areas like robotics, aeronautics and high-tech medical equipment.
Recently, Beijing made a major push with its "Made in China 2025" strategy, outlining the key tech sectors on which it would focus. The goal is to catch up with rivals like the United States and Germany. Those sectors include: chips that are used in smartphones, powerful computers and cloud computing systems, robotics, renewable energy equipment and fully electric and plug-in hybrid cars.
The Alibaba executive's comments came after U.S. Senator Mark Warner spoke onstage at the annual Code Conference, where he said that Chinese tech companies like Alibaba, Baidu and Tencent were all "penetrated deeply by the Communist Party." He claimed those firms owed as much loyalty to the Chinese government as they did to their shareholders.
Tsai, for his part, latched onto the senator's mention of China's single party, saying the "Communist Party, per se, seems like a dirty word here, but in China, that's the form of government."
He added that he disagreed with Warner's "characterization of Chinese companies" and claimed the senator was part of the group of Americans wanting to hold China back from advancing its technology.
"I still don't understand it," the Alibaba executive said.
Major Chinese smartphone makers Huawei and ZTE have come under intense scrutiny in the U.S. for their ties to China's government. Six top U.S. intelligence officials expressed distrust about the two companies to a Senate committee in February, and, when prompted, they indicated they would not recommend private citizens use products from the firms.
"We're deeply concerned about the risks of allowing any company or entity that is beholden to foreign governments that don't share our values to gain positions of power inside our telecommunications networks," FBI Director Chris Wray testified.
Earlier this year, the United States stopped American firms from selling to ZTE based on the company's business dealings with Iran and North Korea. Beijing and Washington have since been talking to work out a solution to help ZTE.
Amid the unpredictability of the trade tensions, Tsai said, Alibaba plans to continue focusing on how best to help American farmers and small businesses tap into the huge consumer market in China. He pointed to the country's middle class now demanding access to better goods and services, including many imported products.
"That's a great, huge opportunity for the producers, all around the world, including farmers, including small businesses in the United States. And that's what we're focused on."
Tsai, who heads Alibaba's global mergers and acquisitions plans, also said the company has not tried to conduct large acquisitions in the U.S. Instead, he added, it is looking for companies and entrepreneurs who want its help to expand into China.
— Reuters contributed to this report.
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a8a489c6b923a0ba6cc679e415cd0580 | https://www.cnbc.com/2018/05/31/apple-digital-health-to-fight-iphone-addiction--report.html | Apple will reportedly introduce new 'Digital Health' software to help fight iPhone addiction | Apple will reportedly introduce new 'Digital Health' software to help fight iPhone addiction
Tim Cook, CEO of Apple Inc.Adam Jeffery | CNBC
Next Monday during its developer conference Apple will introduce a new feature for iPhones and iPads called "Digital Health," Bloomberg said on Thursday.
Digital Health — said to launch as part of Apple's new iOS 12 operating system — will reportedly help users manage how much time they spend on their iPhones and iPads with tools that show how long users spend inside apps, according to Bloomberg.
Apple will add other features, including new tools for tracking the stock market, Bloomberg said.
Google introduced similar features when it unveiled the new version of Android, currently named Android P, earlier this month. Android P has an app dashboard that will show users how much time they spend inside each app. It will also let Android users set time limits for apps, which means users won't be able to access them after they've used them for a predetermined time during the day. Android P will introduce a "Do Not Disturb" mode that silences all notifications and a "Wind Down" function that turns the phone grayscale at a predetermined time so that people can prepare to go to sleep at night.
Apple typically announces the new version of its operating system during its developer conference and then rolls it out to consumers in the fall. Apple was not immediately available to comment.
Read the full report on Bloomberg.
VIDEO4:0904:09Why we need to rethink our understanding of our digital lives: iPhone designerSquawk Alley
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b8fd10d45c3f66be5392ec002273e953 | https://www.cnbc.com/2018/05/31/box-ceo-aaron-levie-teases-small-acquisitions-explains-guidance.html | Box CEO teases small acquisitions and explains conservative guidance | Box CEO teases small acquisitions and explains conservative guidance
VIDEO2:5802:58Box CEO Aaron Levie: We may make small acquisitionsClosing Bell
Box fell more than 7 percent on Thursday after a weaker-than-anticipated second quarter outlook sparked fears the company's growth would slow. But CEO Aaron Levie says the enterprise cloud storage company stands to benefit from cloud migration, and may even be in the market for some small acquisitions as growth picks up.
"Wall Street had pretty high expectations about where we would be guiding in the future, but we wanted to issue guidance we knew we could commit to achieving," Levie said on CNBC's "Closing Bell."
"Overall we are seeing incredible momentum in terms of customers moving their content and collaboration systems to the cloud, and we stand to benefit from all that migration," he added.
Levie says the company has plans to invest more into core technologies, like artificial intelligence, security and workflow, which he could mean small acquisitions in the future.
"We might make small acquisitions ourselves in terms of growing that technology. We are very confident in the position we occupy and just want to expand that from there."
Box has seen a substantial rise in value this year, up 22 percent year-to-date and close to 37 percent year-over-year. Some investors worry Box may not be growing fast enough to compete with giants like Google and Microsoft, but Levie says Box has been competing all along.
"We have been competing with those big incumbents since the day we started our company in college 13 years ago," he said. "Our focus has been build a superior product, deliver a better user experience to end users and enterprise IT buyers...and be the world leader in security, compliance and privacy."
Levie also emphasized the importance of remaining "platform neutral" so as to integrate seamlessly with customers' other services, and discussed a few techniques he said would drive growth rate by the end of 2018 and into 2019.
"We are going through an evolution of our sales model, where instead of selling the core product to customers, it's about add-on services and platform capabilities," Levie said. "That's going to have the impact of growing average contract value."
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78ecd1f9a7d110ca396642af501a1810 | https://www.cnbc.com/2018/05/31/cambridge-analyticas-parent-company-helped-shape-saudi-arabias-reform-movement.html | Cambridge Analytica’s parent company helped shape Saudi Arabia’s reform movement | Cambridge Analytica’s parent company helped shape Saudi Arabia’s reform movement
Crown Prince Mohammed bin Salman, center, at an investment event with his entourage in Riyadh, Saudi Arabia, Oct. 23, 2017.Tasneem Alsultan | The New York Times
The price of oil was in free fall and a youthful population restive.
So the government of Saudi Arabia turned in recent years to the parent company of the political data firm Cambridge Analytica for help, according to Western consultants who worked in the kingdom, company executives and a review of public documents.
The work by Cambridge's parent, a secretive defense and intelligence contractor called SCL Group, presaged the tumultuous changes that are reshaping the kingdom. The company, now mired in scandals related to its corporate practices and the use of Facebook user data, conducted a detailed population study. It provided a psychological road map of the kingdom's citizenry and their sentiment toward the royal family, even testing potential reform steps as they charted a path forward to preserve stability.
Read more from The New York Times: Saudis said to use coercion and abuse to seize billions Data firm tied to Trump campaign talked business with Russians He owns much of Ethiopia. The Saudis won't say where they're hiding him
The consultants and executives spoke on the condition of anonymity because they were bound by nondisclosure agreements.
One proposal tested by the company was lifting a 35-year ban on cinemas in the kingdom, an action that was subsequently taken in December. Another was allowing women to drive, a move that was made last September.
Under King Salman, who came to power in January 2015, the Saudis have turned to an array of consultants as crashing oil prices laid bare the kingdom's lack of economic diversification. Some consultants, such as McKinsey & Company and the Boston Consulting Group, carried blue chip pedigrees, while SCL, founded in 1993 as Strategic Communication Laboratories, was known for its clandestine work.
The company has recently burst into the public eye amid revelations that it employed seduction and bribery to entrap politicians and influence foreign elections. And its Cambridge Analytica unit, which worked for President Trump's campaign, collapsed amid allegations of misusing Facebook data. At least one Cambridge Analytica employee worked on the parent company's Saudi project, according to the employee's profile on LinkedIn.
SCL has a long history of quietly helping governments control their populace and wield power. It provided psychological analyses of citizenry in places like Libya under Col. Muammar el-Qaddafi. Last year, it was hired by the government of the United Arab Emirates, a close Saudi ally, to conduct a social media campaign against its rival Qatar. In Indonesia, SCL once "organized avenues of protests" as a means of controlling student demonstrations, according to one news report, and arranged for the government to covertly fund a conference on journalistic independence, according to another.
The company's longtime chief executive, Nigel Oakes, has described its overall strategy as "group communication" that aims to shift the views of large swaths of a population. "We use the same techniques as Aristotle and Hitler," he once said. "We appeal to people on an emotional level to get them to agree on a functional level."
The notion that the company's psychological research played a role in plotting out the Saudi reform efforts could fuel renewed debate about the intentions of the crown prince, Mohammed bin Salman. The prince is variously seen as his region's most important social and economic reformer, a ruthless opportunist or some combination of the two.
He has spearheaded the reform effort, and is reshaping the power dynamic in the kingdom and the entire region. But his nobler pretensions have been muted by his outsize spending habits, as well as a roundup of billionaires, princes and other officials tied to previous governments. The government is said to have used coercion and physical abuse to seize billions of dollars from the detainees, who were initially held at the Ritz Carlton in Riyadh.
The prince's motives were again called into question two weeks ago, when Saudi authorities detained activists who had pushed for the right for women to drive, even though the kingdom gave in to the campaign.
SCL's work was shrouded in secrecy, but one former analyst at the company, James Lovell, who listed the Saudi project on his LinkedIn profile, said he "analysed focus group data, contributed to presentations and wrote reports for a research project on economic reform in the Kingdom of Saudi Arabia." A project manager at Cambridge Analytica, Alexandra Wicksell, wrote in her profile on the same site that the work was "focused on developing the national reform initiative for the country's drive to diversify its economy away from its oil dependency."
Others who saw the work described it less benignly.
One Western consultant, who was not involved in the project but who viewed SCL's report, referred to the firm's finding as "Machiavellian," calling it a manual for the royals to manage popular sentiment by figuring out where they should loosen their grip. The consultant said the report used dozens of focus groups to examine levels of frustration and satisfaction, as well as the legitimacy of the royal family and the political structure, and showed there was widespread discontent.
The consultant's account was consistent with that of a former employee at SCL. The company's work, said the former employee, was aimed at conducting a behavioral analysis of the population and then creating strategies to keep the government viable in an era of declining oil prices.
A company executive referred to the work as advancing human rights but declined to comment further. The Saudi government declined to comment.
The research by the consultancy was taking place against a bleak new reality. Oil fell to below $30 a barrel in 2016 from more than $100 in 2014. That presented severe economic risks in a country where 70 percent of the population is under 30.
SCL's work was circulated among some of the consulting firms developing a plan called Vision 2030, spearheaded by Prince Mohammed, which aims to move the kingdom beyond oil and modernize its culture.
SCL had worked in Saudi Arabia before. It was listed among the countries where the firm had clients on a 2014 PowerPoint presentation obtained by The New York Times. Its most recent work was commissioned by the Saudi Ministry of Economy and Planning, one of the ministries carrying out the Vision 2030 plan.
To what extent the company influenced the kingdom's plans is hard to say. But in Prince Mohammed's telling, winning over the population has been a critical first step.
"There's a lot of challenge," he said in a recent interview on "60 Minutes," in which he acknowledged that the nation's practice of "subsidizing everybody's life" had put it on a path toward financial crisis. "I think the first big challenge that we have is — do the people believe in what we are doing?"
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20934be68efa3654bbc831fa37d6ab4c | https://www.cnbc.com/2018/05/31/challenger-jobs-report-planned-cuts-slow-in-may-as-retail-leads.html | Planned job cuts slow in May as retail continues to lead this year: Challenger report | Planned job cuts slow in May as retail continues to lead this year: Challenger report
A pedestrian walks along Broad Street in New York.Michael Nagle | Bloomberg | Getty Images
Companies announced plans to cut 31,517 jobs in May, a 13 percent decrease from April, a private survey reported Thursday.
The 207,977 planned job cuts announced in 2018 is more than 6.2 percent higher than the same period of 2017.
"On average, job cuts are at their lowest in May and June. Companies typically make theirstaffing moves at the beginning of the year or in the fourth quarter," CEO John Challenger said in a statement.
May's results held closer to April, which bucked the trend of increasing job cut announcements. Planned cuts hit a high in March, when the most job cut announcements were made in a single month in nearly two years.
Retail leads all sectors in job cuts this year, with 69,316 — far surpassing the next two closest sectors, health and consumer.
The report comes a day before the Labor Department releases its closely watched monthly jobs data. On Wednesday, ADP and Moody's Analytics said U.S. companies created 178,000 private-sector jobs in May, slightly below expectations.
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8839a7ec901fd7c8882050736904d071 | https://www.cnbc.com/2018/05/31/cramer-europeans-are-in-over-their-heads-with-trump-over-trade.html | Cramer: Europeans are in 'over their heads' on trade because they've never seen anything like Trump | Cramer: Europeans are in 'over their heads' on trade because they've never seen anything like Trump
VIDEO0:5200:52Cramer: Europeans are 'confused' by President Donald TrumpSquawk on the Street
European leaders may be scratching their heads because they've never seen anyone like President Donald Trump, CNBC's Jim Cramer said Thursday.
"The Europeans don't know what to do. I think they're a little taken by surprise," said Cramer, referring to the Trump administration's decision Thursday to impose tariffs of 25 percent on steel imports and 10 percent on aluminum imports from Canada, Mexico and the European Union, effective at midnight.
"Whatever the Europeans are doing, they are confused because they've never seen anything like this president," Cramer added on "Squawk on the Street." "They are so over their heads versus this guy."
Stocks were lower Thursday, with the Dow Jones industrial average down about 200 points on trade concerns. The EU is expected to retaliate with its own measures.
Cramer, host of "Mad Money," said Trump does not like the EU's trade practices, adding he isn't "looking for an apology" but looking for an entire "dismantling of the way European companies" have done business.
Cramer noted the one U.S. stock that should be down on news of Trump's tariffs isn't. "General Motors," he said. Shares of GM were more than 8 percent higher after it announced that the SoftBank Vision Fund plans to invest $2.25 billion in GM Cruise Holdings, further boosting the automaker's efforts with autonomous vehicle technology.
Meanwhile, the steel and aluminum tariffs against Canada and Mexico come as the U.S. has been trying to renegotiate the 1994 North American Free Trade Agreement with its partners north and south of the border. Trump has repeatedly said if a better deal can't be crafted he would pull the U.S. out.
Cramer has spoken extensively on trade, particularly on U.S. trade tensions with China. Last week, he said a full-blown trade war with China could make life "very expensive" for most people in the United States. The Trump administration has also been talking to Beijing about crafting new trade parameters to address the massive goods and services deficit with China.
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88513fff0237c67676dea0adff7d15f0 | https://www.cnbc.com/2018/05/31/jack-dorsey-had-a-700-million-month.html | Jack Dorsey had a $700 million month | Jack Dorsey had a $700 million month
Jack Dorsey attends the '#SheInspiresMe: Twitter celebrates female voices & visionaries' event in Cannes, France.Francois Durand | Getty Images
It's been quite a month for @Jack.
Twitter, which Jack Dorsey co-founded in 2006, has jumped 14 percent in May, a month in which the S&P 500 has gained just 2.6 percent.
Square, the payments company that Dorsey launched three years later, has performed even better, surging nearly 24 percent for the month to a record $58.90 as of Thursday morning.
Dorsey has been as much a beneficiary as anyone. His stake in Square has jumped by $668 million this month, and his Twitter shares have appreciated by $65 million.
As May comes to an end, Square is worth $23.6 billion, not far behind Twitter's $26 billion stock market value. After years of skepticism, Wall Street has apparently come around to the idea of the 41-year-old Dorsey running two publicly traded companies at the same time.
When Dorsey took over Twitter from Dick Costolo in 2015, it was supposed to be temporary. At the time, Dorsey had his hands full with Square, which was preparing for its stock market debut and was having trouble justifying its private market valuation to prospective investors.
Twitter's board couldn't agree on anyone else, so Dorsey was given the full-time gig at Twitter just a month before Square's IPO. Analysts were relieved to see the process come to an end, but had plenty of concerns.
"As a product guy, Dorsey is a good fit, although we thought an outsider was the best option," wrote Evan Wilson of Pacific Crest Securities. Analysts at JMP Securities wrote that, "While it remains to be seen how well new CEO Dorsey can manage both Twitter and Square, we believe he will be most focused on Twitter's product and making it easy to use."
Investors who stuck with Dorsey have made a bunch of money, particularly in the past year. Twitter shares have climbed 88 percent over the last 12 months, outperforming all of the most valuable tech companies. Over that same stretch, Square is up 154 percent.
Twitter was catapulted recently by a better-than-expected earnings report. In late April, Twitter recorded its second straight profitable quarter, with earnings and revenue that beat analysts' estimates. Video ads were a big driver of sales growth, and the company also lured advertisers internationally, especially from China and Japan.
VIDEO2:1702:17Here are 9 surprising facts about Jack DorseyDigital Original
Square issued a disappointing earnings forecast after the bell on May 2, but the shares went up the next day anyway. Heading into Thursday, Square's stock had gained on 16 of the 20 trading days in the month, one more than Twitter.
Gross payment volume increased 31 percent to $17.8 billion in the fiscal first quarter, as merchants continued to shift from older payment systems to Square's modernized point-of-sale terminals.
"SQ has the Big MO (Momentum)," Joseph Foresi, an analyst at Cantor Fitzgerald, titled a report after the company's results. "We expect rapid growth to continue and foresee further margin expansion going forward, driving stock performance," he wrote.
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b2733dfa53ed27e29d68aff5fd4f7f12 | https://www.cnbc.com/2018/05/31/meet-silvergates-alan-lane-whos-bankrolling-cryptocurrency-exchanges.html | Meet the small community lender that's become the go-to banker of the cryptocurrency world | Meet the small community lender that's become the go-to banker of the cryptocurrency world
Alan Lane, CEO of Silvergate bank.Source: Elizabeth Ann Photography | Silvergate Bank
"How can I contact Silvergate?" a young, dark-haired man in a black hoodie asked frantically at last month's Consensus conference, a massive gathering in New York City for those interested in bitcoin and its underlying blockchain technology. It was after hours, and Silvergate's exhibit booth had closed for the day.
The man, one of thousands of people who paid $2,000 for access to the conference, had seemingly broken a sweat tracking down the unassuming booth in search of the man known for bankrolling cryptocurrency start-ups: Silvergate Bank CEO Alan Lane.
He noticed Lane's stray card sitting on the table, and lit up. "This is exactly what I need."
Silvergate Bank in La Jolla, California.Google Earth
San Diego-based Silvergate is a 30-year-old community bank with three branches in southern California. Yet, it has become known as a lifeline for cryptocurrency exchanges and companies that had their accounts closed or were turned down by Wall Street banks wary of an emerging asset with potential ties to money laundering. Even Warren Buffett has expressed his skepticism about bitcoin, calling it "rat poison."
Undeterred, Lane is one of the most aggressive executives in cryptocurrencies. Alongside the recent surge of interest in bitcoin and its rivals, Silvergate doubled its assets to $1.9 billion last year. The bank now has more than 250 international clients in the industry, drawing new customers by acting more like a 24/7 clearinghouse for cryptocurrency exchanges.
On the surface, the 56- year-old seems much more like a college professor, or a priest, than a wheeling-and-dealing bank executive. During a recent interview, Lane took off his glasses before answering a question he has clearly been asked before: Why would you bet this small bank's reputation on one of the biggest headline risks of the past five years?
The grandfather of 21, and devout Catholic, said he became interested in cryptocurrency in 2013. At the time, he had been reading about bitcoin and how it might disrupt banking, an industry he had grown to love and started working in when he was a student at San Diego State University. Because of what's known as "distributed ledger" technology, people could theoretically become their own banks, without the need for third parties, he found out.
"I thought "uh oh, what am I gonna do?" Lane said with a laugh.
The first thing he did was buy some. In his research, he also learned that companies trading bitcoin were being turned down left and right by other banks.
"I put two and two together and I thought, well it might disrupt banking long-term but in the short-term these companies need banks," he said. "They're not doing anything wrong. They're not doing anything illegal or immoral. If they were we wouldn't be banking them."
Five years ago, when bitcoin was still at the fringes of mainstream awareness, Silvergate invited in young crypto exchanges and asked them what problems they were trying to solve and how the bank could be helpful.
In order to do business with them as a state chartered bank, Silvergate needed the California State Banking Department on board as well as the Federal Reserve Bank of San Francisco. In the summer of 2014, they brought the two regulators in and put on a presentation on bitcoin.
"That open communication with the regulators early on has proven to be really foundational," Lane said. "We're very collaborative with the regulators, we ask them if they have suggestions, and what we can do better." Silvergate has a track record of timely reinvention. The bank was founded as a thrift in 1988. Less than a decade later, current Chairman Dennis Frank, an ex-Goldman Sachs banker, reorganized it into a bank.
Frank had left Wall Street during the savings and loan crisis of the late 1980s to buy up failed thrifts through Houston's Coastal Banc. After selling Coastal in 2004, he moved on to California, where he would recruit investors from his Goldman days to invest in, and re-capitalize Silvergate in 1996.
Under Frank's leadership, Silvergate stopped its mortgage operations in 2005 before the subprime meltdown. And when the 2008 financial crisis hit, the bank was in a solid position to lend as many other banks were paralyzed by bad mortgages on their balance sheets.
That's when Frank asked Lane to come in as CEO. By then, Lane had worked his way up in the industry through several executive positions: CFO of Independence One Bank, CEO of Business Bank of California and president of Southwest Community Bancorp. Lane also had a two-year stint as a professor and co-founder John Paul the Great Catholic University in San Diego.
Lane recalled Frank telling him, "I'm a Wall Street guy and I need a banker as a partner, would you join me?"
Silvergate's ability to stay profitable during the financial crisis meant it had no shortage of lending opportunities, Lane said, but the problem was getting enough customer deposits to fund those loans. Silvergate looked to cryptocurrency companies to fill that gap.
Major Silvergate clients include the Winklevoss twins' Gemini exchange, Paxos, bitFlyer and Kraken.
David Ripley, COO of Kraken, said in an email, "For the most part, the larger banks in the U.S. have stayed away from banking cryptocurrency businesses. In the U.S. and particularly Europe, we see smaller, more technologically advanced banks partnering with cryptocurrency businesses."
About half of the bank's shareholders are betting that crypto is the way to go, too. They and some other investors contributed to $114 million in order to expand Silvergate's cryptocurrency businesses. Lane said the investors were drawn in as a way to invest in cryptocurrency without looking for the next new token.
"We've got institutional investors who traditionally invest in banks, and they just liked this strategy," Lane said. "They're looking to get exposure in the asset class via something they understand."
Silvergate's willingness to work with cryptocurrency companies is key to the growth of the digital asset industry overall.
"One of the ways governments had tried to make digital currency exchanges harder to operate is to cut off their banking relationships," said Travis Scher, Digital Currency Group's vice president of Investments. "It hasn't always been easy for them to secure [a banking relationship]."
Run by cryptocurrency enthusiast Barry Silbert, Digital Currency Group participated in Silvergate's latest funding round and invests in about 20 cryptocurrency exchanges globally. Its subsidiary, CoinDesk, was the host of the Consensus conference.
Wall Street banks have been hesitant to take on bitcoin-related clients, and many have banned customers from using credit cards to buy cryptocurrency. Barclays in the U.K. is among the few large banks to offer banking services in the space, and is working with start-ups Coinbase and Circle. Goldman is an investor in Circle.
Apart from money laundering concerns, the crypto market was simply too small for most big banks to notice. Until last year, when bitcoin neared the $20,000 mark, the industry was a blip on the radar of regulators and most investors.
Silvergate "saw this opportunity when others didn't, to start banking the cryptocurrency companies in the space," Digital Currency Group's Scher said. "The bigger banks didn't want to do this."
Hesitance from others on Wall Street has opened up the doors for other small regional banks. They include Metropolitan Bank and Cross River Bank in Fort Lee, N.J., which are also working with cryptocurrency companies, according to people familiar with the banks.
But Silvergate appears to have an edge because of how it is using its network of cryptocurrency clients. Rather than just providing a place to store money, the bank has become somewhat of a clearinghouse, facilitating real-time transactions that can otherwise take days.
"Being able to move the payments efficiently is probably one of the biggest things holding back the space," said Chad Cascarilla, CEO and co-founder of Paxos, which owns cryptocurrency exchange itBit. "One of the difficult issues is not actually moving crypto assets. Moving the payments is the hard part."
Silvergate customers can transfer U.S. dollars to other Silvergate bank accounts in what's known as the Silvergate Exchange Network. This network effect helped the bank double its customer base in the first quarter through word of mouth, the CEO said. If a Silvergate customer wants to do business with someone who doesn't have a Silvergate account, they have to initiate a wire or ACH transfer, which can take longer.
"The primary benefit people see when they're signing up with us is the ability to participate in the Silvergate Exchange Network," Lane said. "It becomes really powerful and our clients are the ones reaching out to others saying are you on the network? Are you a client of Silvergate?"
Coinbase, the leading cryptocurrency marketplace in the U.S., did not dispute a report it is working with the bank. Previously, Coinbase was cut loose twice by Silicon Valley Bank, according to Mark Williams, a Boston University professor and a former Federal Reserve Bank examiner.
"Silvergate appears to be the only bank in town willing to sign up cryptocurrency firms whose business attracts those customers who value the privacy such products can provide," Williams said. "Considering that Silvergate Bank only received Federal Reserve Bank member status in 2012, its level of asset growth is remarkable."
While Silvergate has benefited from the rapid growth of cryptocurrencies, the bank has not been immune to more questionable issues that have arisen at the same time. In their five years in the space, Lane said the bank had to exit a "handful" of relationships with cryptocurrency companies because of compliance issues.
To ensure quality clients, Lane said they heavily vet companies to make sure they don't invest in the next fraud.
"There's always going to be an element that's out of our control. Our hope is that we're doing things right on the front end, so that we're not letting in bad actors, so to speak. Not letting them in through the front door," he said.
This year, Silvergate plans to more than double its fintech team, which includes compliance, from about 15 people to 40 people, or 20 percent of the total employee count.
The bank also mitigates much of its financial risk by the amount of cash Silvergate has sitting in its accounts, according to Bert Ely, a financial institutions and monetary policy consultant.
"They obviously have very substantial customers that are keeping very big balances in these accounts," he said. Because it's so cash-heavy, "Silvergate has sufficient liquid assets to handle a very substantial outflow."
Regardless of the risks, Silvergate and its customers are in the new asset class for the long haul, betting on an influx of institutional funds that will send cryptocurrency prices climbing again.
Even as bitcoin and other cryptocurrency prices lost more than half their value in the first quarter, Lane said the number of Silvergate clients more than doubled. Institutional clients are generally less "fickle" and reactive than some retail investors, he said.
"When the prices stabilize or go down we don't see a bunch of money leaving the bank," Lane said. "They're sitting there, waiting for next opportunity."
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ccd3fea7965a900e28d08b656de3f859 | https://www.cnbc.com/2018/05/31/muellers-travel-costs-rise-80-percent-amid-far-flung-investigation.html | Mueller's travel costs rise 80 percent, amid far-flung investigation | Mueller's travel costs rise 80 percent, amid far-flung investigation
Robert MuellerTom Williams | CQ Roll Call | Getty Images
Special counsel Robert Mueller's travel costs are up almost 80 percent, according to a report his office issued Thursday, a sign that the investigation added more destinations to its sprawling inquiry in the six months between last October and March of this year.Mueller, who's investigating President Donald Trump's ties to Russia, doesn't disclose where his staff travels. But there is no shortage of locations that have garnered the interest of investigators in what has become a global investigation into the financial dealings of the president's associates. Travel costs totaled $532,340 in the six months covered in Mueller's latest, and second, expenditure report. That amounts to about $90,000 per month, compared with about $50,000 per month in the previous period.
Mueller's spokesman Peter Carr said the latest accounting is the first "with the office operating with full staff, travel, rent, communications and IT services."
VIDEO1:0701:07Giuliani says Russia probe may end by Sept. 1News Videos
"The prior statement represented a time when the office was getting started, and it did not reach full operations in these areas until the latter half of that reporting period," Carr said.
Investigators appeared to have escalated their interest in Trump's personal lawyer and fixer Michael Cohen in the six-month period.
According to a report in McClatchy, Mueller's agents interviewed a Trump business associate involved in The Trump Organization's overseas deals about Cohen during the first week of April, right after the end of the reporting period. Cohen, according to McClatchy, was personally involved in Trump Organization deals secured in Georgia, Kazakhstan and Russia.
Also in April, Mueller reportedly secured evidence that Cohen had traveled to Prague in 2016, a claim that Cohen had previously denied. Cohen's Prague travel was an element in the dossier compiled by British former spy Christopher Steele regarding Trump's connections to Russia.
FBI investigators raided Cohen's office and hotel room April 9 after receiving a referral from the special counsel's office.
Separately, in February, a prosecutor in Ukraine reportedly reached out to Mueller to offer to cooperate with the investigation into Paul Manafort, Trump's campaign chairman who Mueller indicted in October 2017 for failing to register as a foreign agent. A grand jury returned a superseding indictment in February of this year.
By April, the prosecutor, who told The New York Times that he did not receive a response to his offer, said that he had lost the authority to investigate Manafort, and so could no longer cooperate with Mueller.
Overall, Mueller's expenditures rose only 5 percent in the latest expenditure report, to about $750,000 a month. The total for the six-month period was about $4.5 million.
While items such as rent, compensation and transportation rose sharply, there was a 95 percent decrease in the category "acquisition of equipment." The cost of supplies and materials also declined.
— CNBC's Christina Wilkie contributed to this report.
VIDEO1:2101:21Pence tells Robert Mueller 'to wrap it up'News Videos
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ae4d515f1a1d671a9819b8b7d6096fd1 | https://www.cnbc.com/2018/05/31/oil-prices-wont-keep-falling-because-us-drillers-cant-meet-demand.html | Oil prices won't keep plunging because US drillers can't meet demand, analysts say | Oil prices won't keep plunging because US drillers can't meet demand, analysts say
VIDEO3:0403:04Oil price decline 'temporary', says proSquawk Box
U.S. crude prices sank on Thursday after a brief rally in the previous session, but analysts say the recent slump in oil prices won't last much longer.
In the five sessions through Tuesday, U.S. crude futures fell from more than $72 a barrel to just under $67 a barrel, shedding 7.6 percent. International benchmark has tumbled as much as $6 a barrel from its recent 3½-year high of $80.50, but has rebounded to about $78 a barrel.
"I think it's temporary. I think the fundamental picture is still really strong. The market's getting a bit dislocated right now based on a risk-off sentiment," Tamar Essner, director of energy and utilities at Nasdaq Corporate Solutions told CNBC's "Squawk Box" on Thursday.
Essner said the market's aversion to risk has been stoked by concerns about the Trump administration's looming trade wars and questions about the integrity of the European Union, which have caused the U.S. dollar to strengthen. A stronger greenback makes commodities sold in U.S. dollars more expensive to holders of other currencies.
Oil prices were already heading lower on recent reports that OPEC, Russia and several other producer nations could soon begin winding down their 17-month-old deal to cap output. That agreement has drained a global glut of oil and helped balance the market, but it's now under review due to falling Venezuelan output and renewed U.S. sanctions against Iran, OPEC's third-biggest producer.
VIDEO2:5902:59Oil market is ignoring the big Iran story, says strategistSquawk on the Street
Venezuela's output has fallen by about 500,000 barrels a day this year and could drop by the same amount by year's end, Essner said. Meanwhile, U.S. drillers would struggle to boost output by more than 1.2 million barrels a day.
"So we need every last barrel of those supplies to take us to where we need to balance the market," Essner said.
Underscoring Essner's point, oil futures reversed some of their losses on Thursday after weekly data showed a big drop in U.S. crude inventories.
American drillers that specialize in freeing crude oil from shale rock formations are facing worker shortages and limited pipeline capacity in western Texas. At the same time, these drillers are focused on returning value to their shareholders, rather than plowing revenue into new production.
"Shale is not Superman," Helima Croft, global head of commodities strategy at RBC Capital Markets, told CNBC earlier in the week.
Shale drillers face yet another hurdle to upping output, according to Essner. Many agreed to deliver oil to customers at prices far below today's levels — a practice known as hedging — and set capital spending plans assuming prices would average about $60 this year. "They're sort of locked in, and when you look at the slope of the futures curve, it's going downward. That makes it harder to hedge production at attractive prices for further-out years," Essner said.
Oil prices are likely to settle around $70 per barrel, said Essner, who believes futures rose to that level largely on supply-and-demand fundamentals.
VIDEO3:2703:27Oil prices driven more by financial markets than physical ones, says oil expertSquawk on the Street
OPEC would likely intervene if oil prices threatened to drop below the $70 per barrel mark, according to Sadad Al-Husseini, founder and president of Husseini Energy Company, on Wednesday.
"Clearly $80 a barel was way too high and was going much higher, he told CNBC's "Squawk on the Street" on Wednesday. "On the other hand they don't want to lose the floor. Dropping below $70 would be clearly too low, so they're trying to coordinate their strategies ahead of the OPEC meeting on June 22."
Husseini said the physical market — where barrels are bought and sold to satisfy actual demand — are "pretty well balanced." For that reason, there's little urgency for OPEC to change its policy until it assesses how far Venezuelan output will drop and to what degree U.S. sanctions will take Iranian barrels off the market.
"There is spare capacity. OPEC can if necessary add production, and if that gets called for, I'm sure the ministers will do that. They just don't want to get ahead of themselves because right now there isn't an issue," he said.
U.S. production may be about to top out, but the industry should work through the bottlenecks by next year, he said. Canada and Brazil are also set to increase output, he noted.
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34afcd613a750f0a23b8a4f9b2870fa8 | https://www.cnbc.com/2018/05/31/sensetime-raises-more-than-one-billion-dollars-in-mere-months.html | Chinese A.I. company SenseTime raises more than $1 billion in back-to-back funding rounds | Chinese A.I. company SenseTime raises more than $1 billion in back-to-back funding rounds
Xiaoou Tang, founder of SenseTime, speaks at the Jumpstarter start-up pitch event in Hong Kong, China, on Tuesday, Nov. 21, 2017.Vivek Prakash | Bloomberg | Getty Images
Investors are pouring funds into Chinese artificial intelligence company SenseTime.
The image recognition firm said Thursday that it raised $620 million in fresh funds from prominent investors including Fidelity International, Hopu Capital, Silver Lake and Tiger Global. Chipmaker Qualcomm's venture capital arm also participated in the round.
The new funds would be invested into research and development and acquiring talent, according to the company.
SenseTime said it is now valued at over $4.5 billion, maintaining its standing as one of the most valuable AI start-ups in the world.
Thursday's announcement comes just months after the start-up said it raised $600 million in funds from Alibaba, Chinese retailer Suning.com and Singapore state investment firm Temasek Holdings.
Last year, SenseTime raised $410 million in funds. In total, the start-up now has capital of more than $1.6 billion.
SenseTime said it became profitable last year and had been growing by about 400 percent on-year for the last three consecutive years. Its business contract revenue has increased by more than 10-fold for this year until May, SenseTime said.
The company's AI-based technologies can recognize faces, characters and images as well as provide video analysis. Those technologies are being used to develop smart cities and applied in areas of internet entertainment, autonomous automobiles, finance, retail and other industries. Chinese authorities also use SenseTime's technology to carry out surveillance to identify persons of interest during criminal investigations.
SenseTime said it has more than 700 strategic partners and customers including Chinese telecommunication giant China Mobile as well as Huawei and Xiaomi.
In recent months, the company said it signed agreements with China's largest subway operator, Shanghai Shentong Metro Group, to use AI to monitor metro traffic, and with the city of Chengdu to create a regional headquarter. The firm also teamed up with Alibaba and the Hong Kong Science and Technology Park to create the HK AI Laboratory to transform Hong Kong into an innovation hub.
Since finding sufficient talent is a common problem for many AI firms, SenseTime has also created a textbook to get the next generation of Chinese students interested in the technology. The company said it plans to develop AI-driven courses and lab experiments to promote the technology in schools.
China has previously said it wants to become the world leader in AI by 2030 — a goal that's led to rapid developments in the country.
For example, Beijing plans to build a $2.12 billion artificial intelligence park in the city to house companies working in areas of big data, bio-metric identification, deep learning and cloud computing, according to reports.
Local tech companies like Baidu, Alibaba, Tencent, ride-hailing firm Didi Chuxing, on-demand services provider Meituan-Dianping and speech and language recognition firm iFlytek are already working extensively on various fields of AI.
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2f7e1f627b3ee1577975e9eeb31f7a4e | https://www.cnbc.com/2018/05/31/us-plan-to-impose-steel-and-aluminum-tariffs-on-canada-mexico-and-the-eu-is-99-point-9-percent-done-and-coming-very-soon-source.html | US metal tariffs are ‘99.9%’ done and will impact Mexico, Canada and the EU: Source | US metal tariffs are ‘99.9%’ done and will impact Mexico, Canada and the EU: Source
VIDEO1:1001:10Trump likely to announce new tariffs on steel and aluminumSquawk Box
The United States is likely to impose steel and aluminum tariffs on Canada, Mexico and the EU Thursday, according to a source familiar with the decision.
The source, who preferred to remain anonymous due to the sensitivity of the situation, said the tariff decision is coming this morning and is "99.9" percent done. The U.S. expects the EU will retaliate in due course.
Metal producers in the countries affected had been granted a temporary exemption from the tariffs earlier this year, but they are due to expire Friday.
The tariffs were originally announced on March 1 when President Donald Trump said that the United States was being treated unfairly.
"People have no idea how badly our country has been treated by other countries. By people representing us who didn't have a clue," Trump said, arguing that trade trends "destroyed" American steel and aluminum industries.
On Wednesday, a trade delegation led by U.S. Commerce Secretary, Wilbur Ross, met with European Union counterparts in Paris but those talks appear to have failed.
Prior to the expected announcement, the French Finance Minister, Bruno Le Maire, said Thursday that Europe would take "all necessary measures" to respond. The EU has previously said it will impose its own tariffs on U.S. products such as motorcycles and jeans.
That message has been reinforced by the German Finance Minister Olaf Scholz who said in an interview with Reuters Thursday that the EU's response to the tariffs must be "clear, strong, and smart."
When asked if there were any signs that the trade dispute could be resolved Scholz added: "No, there are no such signs."
U.S. President Donald Trump arrives to announce his decision whether or not to withdraw from the JCPOA Iran nuclear agreement in the Diplomatic Room of the White House in Washington, U.S., May 8, 2018.Jonathan Ernst | Reuters
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66f76ab8b06f87904343abea981239de | https://www.cnbc.com/2018/06/01/apple-to-debut-phone-to-phone-augmented-reality-ar-at-wwdc.html | Apple to debut phone-to-phone augmented reality, Reuters sources say | Apple to debut phone-to-phone augmented reality, Reuters sources say
Craig Federighi, Senior Vice President Software Engineering speaks about "Augmented Reality" during Apple's annual world wide developer conference (WWDC) in San Jose, California, U.S. June 5, 2017.Stephen Lam | Reuters
Apple next week will debut tools to let two iPhone users share augmented reality while limiting the personal data sent to its servers, two people familiar with the matter said this week.
Augmented reality (AR) allows viewers to see virtual structures superimposed on their surroundings via their smartphones or other devices. It is the technology used in mobile game Pokemon Go, and by industry, such as factories seeking to map new assembly lines. Apple and rival Google are racing to release AR tools to attract software developers to their platforms.
Both are seeking to allow two people to share data so they can see the same virtual object in the same space via their individual devices. But that has sparked privacy concerns — if AR apps become commonplace, people will be scanning their homes and other personal spaces routinely, developers say.
Apple designed its two-player system to work phone-to-phone in part because of those privacy concerns, one of the people familiar with the matter said. The approach, which has not been previously reported, differs from Google's, which requires scans of a player's environment to be sent to, and stored in, the cloud.
Apple declined to comment. Bloomberg previously reported that Apple would announce multiplayer AR at its developer conference, which begins on Monday.
VIDEO10:0810:08The future of augmented realityMarketing Media Money
AR has become a major focus at both companies. Apple CEO Tim Cook has called it "big and profound," and the company released its first tools to let software developers make AR apps last year.
With that release, Apple made AR possible on many phones without any modifications. The move spurred Google to abandon an AR effort that required phones to have special sensors and instead build tools for AR on conventional phones.
The race between the two has heated up since then. At its own developer conference in May, Google rolled out tools for making multiplayer AR games. The system, called Cloud Anchors, requires the first player to scan his or her environment and then upload the raw mapping data to Google's servers, where it is translated into a rough representation of the area.
The subsequent players perform a scan that sends more limited information to the same server, which matches the phones up and lets them each see the same virtual object on the same physical space.
However, Apple's system avoids storing any raw mapping scans of a user's surroundings in the cloud, said the two sources. Google says it will discard raw mapping data after seven days.
The precise details of how Apple's new system will work, or if it would support three or more players, were not available. But a phone-to-phone approach could eventually run into technical limitations. It could end up being harder to handle three or more players at a time if a player who started the game drops out, a person involved in Google's AR efforts said.
"For artistic purposes, it's phenomenal" to be able to precisely map out a user's surroundings and overlay digital objects, said Joel Ogden, chief executive of Construct Studio, which makes augmented and virtual reality games.
"But we're definitely going into some uncharted territory. There are a lot of really severe privacy implications we haven't really explored yet," he added.
VIDEO5:2305:23How to make money if Apple goes up, down or nowhere at allOptions Action
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4abf353bc9b3f86e8c0120e7f408bf97 | https://www.cnbc.com/2018/06/01/bag-maker-samsonites-ceo-resigns-after-short-seller-report.html | Bag maker Samsonite's CEO resigns after short-seller report | Bag maker Samsonite's CEO resigns after short-seller report
Ramesh Tainwala, chief executive officer of Samsonite International SA, speaks during an interview in Hong Kong, ChinaCalvin Sit | Bloomberg | Getty Images
Luggage maker Samsonite said Friday its CEO has stepped down following a report by a short-seller that questioned his credentials and the company's accounting.
The company said in a statement to the Hong Kong stock exchange that Ramesh Tainwala resigned for personal reasons.
A research report issued by U.S.-based short-seller Blue Orca a week earlier said Tainwala had falsely claimed on his resume that he earned a doctorate degree in business administration from Union Institute and University in Cincinnati.
The company said its board took the allegations seriously and decided that his departure was in the best interests of the company and its shareholders.
Blue Orca also alleged Samsonite played "accounting games" related to its 2016 purchase of luxury baggage maker Tumi.
Samsonite called the report "one-sided and misleading," and said the conclusions about its financial results were incorrect. The company added it had accurately disclosed Tainwala's educational background since it went public in Hong Kong in 2011.
Blue Orca's report was its first after it was founded earlier in May by Soren Aandahl, formerly the chief investment officer at another short-seller, Glaucus Research. Investors who "short" stocks profit by betting that their prices will fall.
Luxembourg-based Samsonite's Hong Kong-listed shares jumped more than 7 percent after the announcement.
The company was founded in Denver more than a century ago and family owned until the 1970s, when various investors and private equity groups took over. It listed its shares in Hong Kong to better capture growth in the Chinese consumer market.
VIDEO3:0003:00Discussing the recent short-seller allegations on SamsoniteSquawk Box Asia
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eb28c822053463d525120fcc3d12ad19 | https://www.cnbc.com/2018/06/01/cnbc-transcript-robbie-antonio-founder-revolution-precrafted.html | CNBC Transcript: Robbie Antonio, Founder, Revolution Precrafted | CNBC Transcript: Robbie Antonio, Founder, Revolution Precrafted
Below is the transcript of an interview with Revolution Precrafted Founder, Robbie Antonio. The interview will play out in CNBC's latest episode of Managing Asia on 1 June 2018, 5.30PM SG/HK (in APAC) and 23.00 BST time (in EMEA). If you choose to use anything, please attribute to CNBC and Christine Tan.
Christine Tan: You know Robbie, we're here at this 150 hectare park at Batulao Artscapes which you call a living Art Park. What can one experience by living here?
Robbie Antonio: I've seen other art parks around the world and many of them are just museums and you get to see art and then you go back home. Imagine living in it. Imagine living in a David Salle house, Elizabeth de Portzamparc house, and really being surrounded by this magical environment.
C: What is the price point? How cheap can a prefabricated housing be?
R: The house and lot here is less than 50,000 dollars which is about 3 million pesos or so
C: Your family has been in real estate for almost 30 years. You started Revolution Precrafted in 2015 to essentially create a startup for prefab housing. How did you stumble upon the idea?
R: I come from the real estate world and I've been doing this for over 10 years. In New York, I built my own company called Antonio Development where I did a project in the Plaza District, the most sought after area in all of Manhattan, close to Central Park where nothing has been made in 20 years. So when I did that with Mr I.M Pei, it was the first round of residential products I had ever done. At the very early age of 28 I started the idea of positioning buildings in a proper format, came back to Manila and did a flurry of branded towers with fashion companies such as Armani, Missoni and Versace. I did Trump Tower and also projects with Hollywood icons such as Paris Hilton where I did 9 towers with them. In mid-2015, I wanted to do something extremely disruptive. I wanted to be an asset-light, no inventory business and global.
C: So you were tired of the old model?
R: Yes, to begin with, and second I was looking at major unicorns like Airbnb and Uber from miles away and I basically said this to myself: "What do they have in common?" I asked myself this for a straight week. No inventory, asset-light, using technology and truly global.
I feel that I'm a man of the world and I did not want to just do projects here in Asia. I wanted to look at the world as if it were all the same country and I wanted to be global without being asset heavy. Then it just dawned upon me. It was like a Eureka moment, an epiphany in the middle of 2015. I wanted to investigate an industry called the prefab market, a space which allows you to get from Point A to Point B very succinctly.
It's a means to the end, not the end. The end is to truly be everywhere, ubiquitous, and I wanted to be prevalent and omnipresent in all the regions of the world. I've told my team I want to be in 25 different countries this year, 55 by next year, 85 in 2020 and possibly go public then.
C: You're not worried about cannibalizing your family's real estate business?
R: Why would you talk about cannibalization when you should be talking about complementary businesses?
C: How so?
R: We're in Batulao, it's a 145 hectare development. This specifically is a Century Properties Development, the only 1 I'm doing out of 11 countries and all the master plans we have closed. Case in point you have David Salle's house there, Elizabeth de Portzamparc's house here. Most of these developers outsource construction and supplying of construction to an entity anyway so that's adding value, not cannibalization.
C: So I know it's your own business but what did your father say when you told him about it?
R: I told him after the fact. I said this is what I'm doing, I've been working on this and I'm recently launching this in Miami Art Basel which had just happened a week or 2 weeks before. So I'm very independent, I've always been an independent person. To be emancipated and to really feel empowered is something that is integral to my existence.
C: You literally introduced brand to the whole concept of prefabricated housing by listing well known designers like the late Zaha Hadid and Tom Dixon to create these pre-fabricated housing for you. How do you get these high-end well known architects and designers to create something? They're so used to big budgets, how do you get them to create something at a fraction of the cost? How big a challenge was it?
R: That's the point. That's why it was so intriguing for a lot of people and that's why it was so intriguing for me. I always say in business that if someone's in, I'm out. So that really means I always want to be a first mover in anything I do, and for this particular case as you just stated a lot of these brands are used to doing mega mansions or mega museums. Jean Nouvel's did the Louvre Abu Dhabi, a billion dollar project but now we're doing a Jean Nouvel museum here for not even 0.5% of that. So it was this antithetical rationale and business concept that was intriguing for them.
C: They took it as a challenge?
R: Of course! If you have the foremost brands in design and architecture doing really expensive structures with probably no budgets at all, you get people to think a little bit more. That sets parameters like a mathematical equation and gets people to challenge themselves more.
C: I can understand architects, but you recently just signed on Manny Pacquiao -
R: That was last night, haha.
C: What has boxing got to do with housing?
R: I'm going to do sports cities around the world with him.
C: That's your latest addition?
R: That was yesterday, he's our 76th one. I told everyone in my office that I'm going to stop when we hit 100 and take a break.
C: How did you convince Manny Pacquiao to sign with you?
R: First we're the only branded housing company in the world, bar none. So ultimately it's a choice of doing it with some entity that has not done it or it's not within their business plan, or doesn't understand the full ethos of high impact design and doing it at an accessible price point.
He's a humanitarian and that's what I like about him. So we're talking about creating sports cities and fitness centres under his name and his design, possibly even his land and really trying to change his neighborhood. That's what I found also enthralling about the entire conversation, and we're going to go after it. I don't go for brands just because they're famous; I go for people who are relevant.
C: So, you've got housing, you've got this, and you've got sports cities and sport complexes, what's next?
R: At Revolution we're doing multiple products in multiple geographies. I want to be in 6 regions in the world pretty much everywhere in the world. We've hit 4, definitely Asia with our projects in Myanmar, Philippines and Indonesia. For Dubai, our mega project in 9 islands in the world, we're a foreign group doing something there where not even locals have actually announced so it has been something really interesting to us. I just came from Bahrain where I spoke and we're definitely going to enter that market as well.
C: But what's next? Office towers? Skyscrapers? What's next for Robbie Antonio?
R: We're going to go vertical, and we're going to do prefab condominiums and prefab hotels later on this year. We're actually going to do an Art Hotel here which is still relevant to the art concept. Aside from just creating products, we also engender creative and ingenious concepts for different master plans.
C: Revolution became profitable barely a year after it opened for business.
R: Yeah, the first quarter actually.
C: Did you ever think you would be so successful so quickly? You're actually the Philippines' first unicorn startup
R: I mean, I knew we were going to be successful, but I didn't know the speed with which we were going to achieve this. A lot of these other mega startups, so-called unicorns have unbelievable valuations which raise a billion dollars so on and so forth, but I wanted to stay true to the integrity of the firm to be an asset light business model and to be everywhere.
C: You've signed up more than 7 billion dollars in deals in countries like Puerto Rico, Japan and Dubai, in more than 10 markets. Which overseas markets are you eyeing next?
R: I'm going to Europe next week, to 8 or 9 different countries. Scandinavian countries love modular prefab systems and I'm going to Norway, Sweden, Finland, also going to Poland as well and Spain. But this is a night each, this is no vacation. I haven't had a single day of vacation since I started the company.
C: I understand the basic concept of your business model is that you manufacture parts of the home in the factory then you ship them on-site before assembling them like Lego bricks. How big a challenge is that, logistically?
R: Extremely complex. The prefab business has always been a fragmented industry, meaning that American prefab companies cater mostly to American end users and you go straight to retail. Asian ones are catering to Asians, Malaysian ones are catering to Malaysians and so forth, and it's the same thing in Europe.
C: So you try to build the factories close to your projects?
R: No, that's why I have a network, because the orders are coming from different parts of the world. In some cases for example Batulao is not all, fully prefab. Some are inserted on site in terms of some of the components.
C: So it's basically cheaper to do it that way?
R: Yes, and faster. This goes back to the value proposition of Revolution. The first is speed, we'd like to say we produce things - we used to say at least 90 days, but now I produce in 45, 60 days.
C: So how safe is your housing, Robbie?
R: These are rigorously tested from the factories which go up to 250km/h seismic conditions to the highest degree, so these are very strong robust structures.
C: So just to clarify they can withstand a bad typhoon or a bad hurricane?
R: Why do you think we're shipping in Puerto Rico and why do you think our orders are coming from there? Didn't they just have a massive hurricane there last year? This is exactly why the value added is also helping people get to the points they usually can't get to. For example, Islands, Dubai the World Islands is perfect. Puerto Rico, Vieques is perfect.
C: So you're actually solving the world's housing shortage problem?
R: In a way. I mean think about it right? It's not all about design anymore. The amazing thing about it is it's not a want, it's a need and that's something we're trying to solve here.
C: I know you've done the math, so I know you've worked out how much it costs in terms of transportation costs and shipping, give me an idea how much it costs to actually ship such a big structure to market?
R: It's actually not that much. Our containers ship a little bit over a thousand US Dollars only, so some of these homes can be put in 2 or 3 containers and you can do the math, when it gets from one point let's say Southeast Asia to Australia.
C: So you're inking all these multimillion dollar deals everywhere across the world. But are you investing enough in factories to support the kind of growth you see overseas?
R: We have an amazing network of global fabricators, and depending on where their orders are coming from and from which region in the world, I basically make that call and start producing these homes. So it's a really B2B2C model where we partner and form a joint venture or we supply to a developer and they turn it out to the end user, and so far the sales have been super robust. For example, our project in Lakeshore Pampanga, the world's first livable food bar, sold over a 1000 homes in about 2 months so it's very enriching to see that people appreciate what you do.
C: Are you upping your investment in factories? What sort of amount are we talking about?
R: Absolutely. Ultimately later on I'd like to have different networks of different fabricators, but I'm not at that point right now. I'd like to create my own because I'm literally a control freak.
C: You want to set up your own factory?
R: Yeah.
C: When will it happen?
R: As early as this year actually. I'm already having conversations with amazing technology providers and we're just going to go make the investment
C: So how many of your own factories do you ultimately want to have?
R: Ideally I'd like to have 1 per region, so ultimately that will be 6. I'll start with Asia because that's where most of the orders are coming from.
C: So, late last year, you've actually raised an undisclosed amount of money in your second round of funding from Singaporean venture capital K2 Global. Given all these deals you're inking and your need for investment in factories, how soon before your next capital raising exercise?
R: I'm probably not going to do a Series C because we don't need the money until maybe next year. We've gotten good fresh round from institutional investors and large family offices so I think it won't be until next year when I have hundreds or thousands of these homes already and different master plans to show, and I've reached the goal of hitting the 25 countries we have to have penetrated by the end of the year.
C: What are your plans to take Revolution public? What are you looking at?
R: I mean there are only 2 ways to go to exit out of this or to maintain it. One is to sell it to a company.
C: Are you interested in that?
R: Look, the biggest homebuilders in the world are in America and they're worth 10-13 billion so how can they buy some entity which should be selling at more than that? So the only way to go like many of the unicorns you've seen is to go public
C: Where would you list?
R: Probably America, UK, or Singapore
C: What sort of time frame are you looking at?
R: Maybe 2020 or 2021.
C: Give me a sense of how big you will be in 2020?
R: 85 countries, we hope - north of several billion dollars of revenue a year.
C: North of several billion dollars?
R: That's for sure
C: What are you talking about, 10 billion, 20 billion?
R: No, that's probably a valuation but that will be very difficult to achieve in terms of revenue and high profitability. The greatest thing for our business would be if we can achieve the sort of scale where we can be truly global, supply everywhere, and be very highly profitable.
C: What is highly profitable to you? What sort of figure are you looking at?
R: 30, 35% margin
C: And is that something you're looking at?
R: So, think about it. We have total project revenues about 7.2. About a 3rd of that goes to construction, that's our revenue. So you can just do the math accordingly and then we make about 30% of that, so that's what we're expecting from the current deals. I haven't even got to Europe yet though, but that'll be next week.
C: Do you worry about expanding too fast?
R: Do I worry about expanding too fast? I don't think I'm expanding fast enough in fact.
C: Really?
R: I'm a man of instant gratification and quite frankly I need to see things done very quickly. Expediency is integral and I always say my biggest weakness which is actually my biggest strength as well, is my impatience. I like to see things in a jiffy.
C: Will you be happy just heading Revolution Precrafted? Is there something else in the pipeline you want to kick off?
R: Not at all, I don't think this is the ultimate legacy.
C: What other things are you planning?
R: I think we're doing something great here.
C: But what projects would interest you? Does it have to be a 100 million dollar idea or 200 million dollar idea?
R: No, it's got to be a several billion-dollar idea for me to jump and be excited about something, and it's not just about the math believe it or not. It's about truly changing the way people think about something. That's what really interests me, the challenge of that. The sheer challenge and difficulty of achieving something that is seemingly insurmountable challenges me.
C: You father is well known Philippine real estate tycoon Jose Antonio of Century Properties. You've joined him in the ranks to be among Forbes' 50 richest in the Philippines. How does it feel like to create your own business, to be successful in your own right?
R: It's obviously gratifying. I know a lot of people and friends from different countries who are of the 2nd or 3rd generation and I respect that but I respect the founders more. I mean growing a business is very impressive, but starting a successful business is the most difficult thing.
C: So you don't want to be seen as the 2nd generation, you want to build something in your own right, in your own right?
R: I've already done it, so I think that's the point of this exercise. And look, I don't know what you call that, insecurity. Sometimes when I interview people I actually like people who are because they always have something to prove and when you have something to prove you work harder than everyone else.
C: You have something to prove all the time?
R: To myself. Not to anyone else, but to myself.
C: So your family is in real estate, your father obviously running Century Properties. Any valuable lessons you picked up from him over the years as young boy watching him grow his business?
R: I mean I obviously thank him because my love for real estate came from him so I will never take that away from him. But the desire to do something differently, the desire to create something is truly inborn and sort of innate with me, so I always try to innovate, disrupt an industry or industries.
C: Whether it's Paris Hilton, Lenny Kravitz or Adrien Brody, you in particular hang out with the who's who in the celebrity world. What's it like having friends in such high places? Is it mostly business or mostly pleasure?
R: First, I don't just hang out with celebrities. I mean a lot of people think that but a lot of it is they're my friends. Some of them are my very good friends or my best friends. To me work is play; to me a trip in Spain has got to be filled with meetings aside from other things. It's all intertwined in one.
C: So you always try to find a way to turn a personal relationship into a business relationship? You're always looking for an opportunity?
R: I always think, "Is there a deal here?"
C: So when you're talking to Lenny Kravitz or Adrien Brody, you're always thinking is there something I can do with them?
R: I bet you half of them are thinking the same way! So I might as well just make the first move, some of them may come to deals and some of them may not be deals and that's really ok,
I get back to them in a couple of months or weeks when I have something formidable because I want everyone to be excited by this.
C: You're one of the most well connected young Filipinos today. You've been described as someone with a magnetic personality that no one can say no to. Are you really that persuasive when it comes to closing a deal?
R: First I think I give the value proposition in a succinct and formidable manner where they can truly understand it and buy into it. I think obtaining 76 of the world's best architects and designers is not an easy thing and I've been doing this prior to this, so I've totaled it to about 84, probably more than any human being in the world
C: So you just turn on that Robbie Antonio charm to get people to say yes to you?
R: No, I mean, I think it's just my personality. I'm very much driven by obtaining these things
C: Do people ever say no to you?
R: Of course some people do. Very few, but some people do. Most say yes and we'd like to keep it that way
C: You're 41 years old, born in the Philippines. You studied many years in the US, got your Economics degree there, an MBA from Stanford, spent 5 years working in the US, joined your father's business in 2009, and then really founded Revolution Precrafted in 2015. How would you describe your leadership and your management style? What is Robbie Antonio like?
R: I'm hardcore. I have an almost West Point type of leadership, military style. In fact I love interviewing military people, people who have business backgrounds because they're very disciplined. I wake up my team up at like 4:35 in the morning.
C: You wake them up at 4:35 in the morning?
R: Yeah, I basically Whatsapp all of them and I ask for reports and all that and I'm probably the last person they hear from in the evening.
C: Is it true you have a rule in the office where employees have to answer a text or an email within 10 minutes of getting it and accomplish the task within 24 hours?
R: Yeah, that is correct and if I don't hear from them, I have 1 of my assistants (and I have 4) contact them to get me a response.
C: Why is speed important to you?
R: Because it's always a race. People say it's not a sprint, it's a marathon, but I strongly disagree. It's both, it's always a sprint and then you need to be sustainable to make it a marathon.
C: And finally as one who's won awards and really made the journey, what advice would you give other young entrepreneurs on how to build great disruptive businesses?
R: Think bold, always think big and achieve it no matter what people say. Be passionate, be obsessed, do it all. Know your rights and never, never, ever give up. Once you give up it becomes a habit and you don't ever want that to happen.
ENDS
For more information contact Clarence Chen, Communications Manager, APAC:Clarence.Chen@cnbc.com D: +65 6326 1123M: +65 9852 8630
About CNBC:CNBC is the leading global broadcaster of live business and financial news and information, reporting directly from the major financial markets around the globe with regional headquarters Singapore, Abu Dhabi, London and New York. The TV channel is available in more than 410 million homes worldwide.
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About Managing Asia:Managing Asia is the Asia Pacific region's ground-breaking interview programme featuring CEOs, entrepreneurs and other business leaders.
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93cd3f9cc0b70f7ff8ea04be0401066f | https://www.cnbc.com/2018/06/01/damaged-homes-earthquakes-la-backs-musks-boring-co-risk-taking.html | Los Angeles backs 'risk taking' of Elon Musk's Boring Company — Residents fear damaged homes, earthquakes | Los Angeles backs 'risk taking' of Elon Musk's Boring Company — Residents fear damaged homes, earthquakes
VIDEO3:0903:09Building a high-tech L.A.CNBC Disruptor 50
Elon Musk is no stranger to controversy. Even his "boring" company — The Boring Company — can't steer clear of it. It is in the very early stages of trying to solve a legendary traffic problem here on earth. In May, Musk detailed his plans to dig mass transit tunnels under the city of Los Angeles, where the Boring Company is headquartered.
The project has faced some criticism from local communities amid fears about earthquakes and that tunneling could damage their homes. Two neighborhood groups representing parts of LA's west side have filed a legal challenge against the city's proposal to exempt the project from environmental review. But the city is trying to fast-track the project. At the state level, a bill introduced earlier this year in the California legislature to impede Musk's Boring Company from selling flamethrowers to the public also just failed.
Speaking at the first-ever CNBC Disruptor 50 Roadshow event in Los Angeles on May 23, Los Angeles Mayor Eric Garcetti explained his support of The Boring Company and the use of LA as a testing ground. He believes Musk's companies exemplify the diversified technology ecosystem he is working to grow in the city, and LA doesn't want to force Musk to go elsewhere with his ideas.
Another Musk company, SpaceX, was No. 1 on the recently revealed 2018 CNBC Disruptor 50 List based on its progress in reusable rocket technology and plan to take humans to Mars. SpaceX is headquartered in the City of Hawthorne, in Los Angeles County.
"I love that companies like SpaceX will change the entire paradigm," Garcetti said at the CNBC event. But Garcetti added another note about Musk's companies not likely to calm down LA residents who are worried about the digging under their backyards. "An engineer from SpaceX will be part of a new company, in this case, another one of Elon's companies, The Boring Company, never having done construction technology before."
Garcetti was referring to Steven Davis, a former SpaceX engineer, who is leading The Boring Company's project digging tunnels under LA.
Boring Company's first tunnel.Source: Boring Company
"Who knows whether it will hit or not but isn't it worth trying?" Garcetti said. "And don't we as Americans want to see our technologies work and then be applied right in our own backyard instead of China or Dubai or other places that seem to be more risk-taking?"
Los Angeles was named the world's most gridlocked city for the sixth straight year in 2017 by INRIX, a leading transportation analytics firm. INRIX estimates that the average LA driver spent 102 hours (or more than 4 days) stuck in traffic in 2017, which it estimates cost the city $19.2 billion. Facing numbers like that, it's not hard to understand why Garcetti is turning to LA's tech community to try to break up some of the gridlock.
"I think LA's developing that reputation, with transportation technology for sure," he said. "We are a place that will work with you … test it here."
More from CNBC Disruptor 50:From rule-breakers to rule-makers: How Uber, Airbnb and other star start-ups scale up for success CEO says Crowdstrike's security platform could someday attract Amazon, Google Indigo Agriculture CEO wants to change economics for farmers with a 'revolution in agriculture'
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fdbd43300995492a963289ce82503e0b | https://www.cnbc.com/2018/06/01/domo-files-s-1-prospectus.html | Domo, an analytics start-up created by Omniture co-founder Josh James, has filed to go public | Domo, an analytics start-up created by Omniture co-founder Josh James, has filed to go public
George Kavallines
Domo, a company that helps business owners access real-time data from their smartphones, filed for a public offering on Friday.
Here are some details from the prospectus:
Net loss of $176.6 million for the year ending in January, narrower than $183.1 million loss the year prior.Revenue of $108.5 million for the year ending in January, up from $74.5 million the prior year.Gross margin: 64 percent, up from 60 percent the prior year.Customers: 1,500 organizations
The prospectus provides an unprecedented look inside the somewhat secretive technology company: Although it incorporated in 2010, Domo didn't publicly announcd its platform until 2015. Since then, a public offering has loomed — Bloomberg reported in 2016 that Domo was working on preparations, and Recode reported in April that an IPO was imminent.
Domo is led by Josh James, who helped found Omniture, an online marketing cloud company that became Adobe Marketing Cloud. Domo's product is aimed specifically at CEOs, but can also be used by other employees.
"Domo enables CEOs to manage their entire company from their phone, including one Fortune 50 CEO who logs into Domo almost every day and over 10 times on some days," the company wrote.
Domo said it plans to post losses for the foreseeable future and will be expanding its sales staff. It's also spending heavily on marketing, including on television commercials and newspaper ads.
In the quarter that ended in April, Domo spent $39.7 million on sales and marketing, while only generating $31.9 million in revenue. Total operating expenses were twice as high as sales.
The company was valued at over $2 billion in the private market, according to CB Insights, and is backed by TPG, IVP, Benchmark Capital and GGV Capital, according to the prospectus. It was a CNBC Disruptor company in 2017.
VIDEO2:4302:43Doing business in the cloudSquawk Alley
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8253bec5f7bca431c95f8cb0e4410a33 | https://www.cnbc.com/2018/06/01/general-motors-stock-will-double-in-next-two-years-analyst.html | General Motors stock will double in the next two years, says analyst. Here's why | General Motors stock will double in the next two years, says analyst. Here's why
VIDEO4:5504:55GM shares will double in two years: AnalystClosing Bell
Share prices of General Motors could double in the next two years, said Christopher Susanin of Levin Capital Strategies, a New York-based investment management firm.
"We think there's about $30 of hidden value that [is] mispriced in the stock across three buckets, each worth about $10 a share," Susanin said Friday on "Closing Bell."
The three areas of growth include changes to the company's portfolio, such as exiting the European and some Asian markets, new ventures with the Cadillac company and added profits from adjacent businesses.
"They are about to restructure the Korea business altogether," said Susanin, senior securities analyst at the firm. "Those moves, we think, add a couple billion, two and a half billion [dollars] to profit and are worth a little bit more than 10 bucks a share."
He said Cadillac, owned by parent company General Motors, also has initiatives in place to double sales and profits.
"We think that could add almost a dollar a share, maybe 75 cents of earnings that are worth almost another $10 of share that are not properly priced in the stock," Susanin said.
Lastly, adjacent businesses, including OnStar, GM Financial and the company's aftermarket business, could add between $1.5 billion and $2 billion in profit over the next few years.
"That's another 10 bucks a share," said the analyst.
Shares of General Motors were trading around $43 on Friday. But Susanin said it's worth closer to $75. New investments in self-driving vehicles will also help drive the stock higher.
On Thursday, General Motors announced that SoftBank Vision Fund plans to invest $2.25 billion in GM Cruise Holdings, helping boost the company's stake in autonomous vehicles. Shares surged about 11 percent after the announcement.
"This is a very big deal," Susanin said.
He said the company's market cap — currently close to $61 billion — will only continue to expand after GM launches a commercialized autonomous ride share, if the company can maintain lower prices than competitors such as Uber. GM said it will have the necessary capital to reach commercialization at scale in 2019.
But investors have known about many of the strategies employed in GM's base business for some time, said Jamie Albertine, managing partner and automotive analyst at Consumer Edge Research, a research firm. And they likely won't move the market.
"On the pullout of GM Europe, we've known that for some time," Albertine said on "Closing Bell" Friday.
He also pointed out that GM is overexposed in its car business in the United States and that the trucking business isn't growing that much.
"GM probably is in the best position of its OEM peers right now," Albertine said, referring to companies with goods used as parts in other company's products.
"But to see it double in two years, we think it's low probability," he said. "It'll take more like five to seven years for this to play out, in our view."
Disclaimer
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338d731930e9390ace4cc2a10bde2cf2 | https://www.cnbc.com/2018/06/01/google-and-amazon-back-ctrl-labs-sensetime-raises-620-million.html | Top VC deals: Google and Amazon both backed CTRL Labs, and Chinese AI firm SenseTime raised $620 million | Top VC deals: Google and Amazon both backed CTRL Labs, and Chinese AI firm SenseTime raised $620 million
Here's a round-up of the most important deals in venture capital from the past week.
Xiaoou Tang, founder of SenseTime, speaks at the Jumpstarter start-up pitch event in Hong Kong, China, on Tuesday, Nov. 21, 2017.Vivek Prakash | Bloomberg | Getty Images
Chinese artificial intelligence company SenseTime said Thursday that it raised $620 million in fresh funds from prominent investors including Fidelity International, Hopu Capital, Silver Lake and Tiger Global. Chipmaker Qualcomm's venture capital arm also participated in the round. SenseTime just raised a $600 million in a round in April. The new funds will be used by the rapidly growing image recognition company for research and development and to hire more talent, according to the company. SenseTime said it is now valued at over $4.5 billion.
Alibaba and Tencent, China's biggest tech companies, have both invested in a $300 million, series D round of funding in a shopping app called Xiaohongshu, which means "Little Red Book" in English. The company is valued around $3 billion. Alibaba led the investment joined by Tencent, GSR Ventures, GGV Capital, Zhen Fund and several others. It is rare for Alibaba and Tencent to invest into the same venture, notes China Money Network.
Taxify founder and chief executive Markus Villig stands in front of Taxify branded carTaxify
A ride-hailing company called Taxify raised $175 million and notched a $1 billion valuation, the company revealed on Wednesday. Daimler led the investment joined by Didi Chuxing, French venture investors Korelya Capital and others. Taxify operates throughout Europe and Africa, and boasts 10 million customers across in 25 countries. The company entered London, a key battleground for Uber, last year.
Alphabet venture arm GV led a $95 million investment in PACT Pharma, joined by Canaan Partners. The start-up is developing cancer treatments that work by reprogramming a patient's immune system cells to combat the disease.
A mobile banking app called Chime raised $70 million in a series C round led by Menlo Ventures and joined by Forerunner Ventures, Omidyar Network and other earlier investors. Chime offers accounts with none of the typical fees charged by retail banks such as monthly usage, minimum balance, overdraft, ATM and international transaction fees. TechCrunch reports that the series C deal brings Chime's valuation to around $500 million.
Virtru, which provides e-mail and file data security to businesses and government offices, raised a $37.5 million in a series B round led by ICONIQ Capital. Earlier backers Bessemer Venture Partners, New Enterprise Associates, Samsung, Blue Delta Capital, and Soros Capital also participated.
Ecobee smart thermostatRichard Lautens | Toronto Star | Getty Images
Smart thermostat maker Ecobee raised $36 million from Caisse de dépôt et placement du Québec, AGL Energy and BDC. The Ecobee 4, its latest smart thermostat, has built-in Alexa, which allows users to just tell the device how to adjust the temperature in their homes, without searching for a remote or tweaking controls.
VIDEO2:0402:04Ava's wearable makes tracking fertility easier than ever beforeModern Medicine
Ava, a Swiss start-up that makes an ovulation tracking bracelet, raised $30 million in a series B round from European venture firms btov and SVC, and other investors. Ava is conducting clinical trials with the University Hospital of Zurich.
CTRL-labs, a start-up developing "neural interface technology" raised $28 million in an investment led by Lux Capital and Alphabet's GV (formerly Google Ventures), and joined by a who's who of tech firms: Paul Allen's Vulcan Capital, Peter Thiel's Founders Fund, the Amazon Alexa Fund and others. Founded by Microsoft Internet Explorer Thomas Reardon, CTRL-labs is developing a wearable that may one day empower users to control computers, prosthetics and other devices with their minds.
Source: Sesame Street
Collaborative Fund, a New York-based venture firm, has closed its fourth fund at $100 million. The firm was an early backer of Kickstarter, Lyft, Blue Bottle Coffee and apparel makers Outdoor Voices. Collaborative Fund is also an investment partner to Sesame Workshop, and they co-invest in start-ups that focus on "helping kids grow smarter, stronger, and kinder," via Collab+Sesame.
-- CNBC's Ryan Browne and Saheli Roy Choudhury contributed to this report.
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dd170c453974aae442b2ed74d0f56b62 | https://www.cnbc.com/2018/06/01/how-to-avoid-a-summer-vacation-scam-and-other-pitfalls.html | How to avoid a summer vacation scam (and other pitfalls) | How to avoid a summer vacation scam (and other pitfalls)
VIDEO2:3402:34Travel mistakes to avoidOn the Money
Nothing can spoil your carefully planned R&R like getting ripped off.
Or worse, a misfortune of your own doing — think an expired passport, lost wallet or booking a vacation to, say Walley World, only to discover it's temporarily closed.
However, these are all pitfalls that can be avoided. Ahead of summer travel season, here's how to sidestep a few all-too-common snags.
With the rise of deeply discounted online offers and unregulated home rentals has come a slew of potential scams.
Travel fraud rose 16 percent last year and cost travelers $283 to $588 per fraudulent transaction, according to a recent report by credit reporting company Experian.
"The reason why most folks get into this situation is because they are out there hunting for a deal," said Mike Bruemmer, Experian's vice president of consumer protection. "If it's too good to be true, it usually is."
Avoid "instant" travel discounts through third parties designed to lure you into an impulse purchase on a hotel, plane ticket or cruise, Bruemmer said.
Often, high-pressure booking tactics require payment well in advance, and that leaves vacationers with little recourse if their trip falls flat (there's only a 60-day limit on disputing a credit card purchase, according to the Federal Trade Commission).
If you're looking for an apartment rental, steer clear of making arrangements directly with an owner, who may or may not be legitimate, and opt for a trusted site such as Airbnb or Expedia's HomeAway, which have built-in protections and money-back guarantees.
And even then, avoid providing any more personal identification than is necessary, such as a Social Security number or agreeing to a credit check.
Be sure to verify that you have your passport — and that it has not expired — well before your international trip.
Anthony Michael Hall, Chevy Chase, Beverly D'Angelo, and Dana Barron waving from car in a scene from the film 'Vacation', 1983.Warner Brothers | Getty Images
Keep in mind that the expiration date on that document is misleading.
That is because you generally want to have a passport that is valid for at least six months from the date of your trip, according to Julie Hall, a spokeswoman at travel organization AAA.
If you need to renew your passport or apply for one, be sure to leave plenty of time. The process can take six weeks, Hall said.
It is possible to obtain expedited passports in some cities, such as New York, though those services may be harder to find in other locations, said Erika A. Richter, director of communications at the American Society of Travel Agents.
Your vacation time is an investment.Erika A. RichterAmerican Society of Travel Agents
Not updating this key document could be a deal breaker if you arrive at the airport gate unprepared.
"That is a situation where you would have to have someone advocate on your behalf," Richter said. "If you're not insured, that's your whole vacation right there."
Be sure to make paper copies of all of the key documents and contents of your wallet before you depart.
Ideally, you want to leave a copy of these documents with a trusted family member or friend before your trip. Keep another copy with you, but separate from your actual wallet and passport while you travel.
"If you do lose it, you have it copied and ready to go and that makes that process a little smoother," Hall said.
Letting your bank or credit card company know you are traveling ahead of time will prevent any hassles at your destination.
"They can put a note on your account so none of your charges get flagged and your credit card isn't declined," Hall said.
More from Personal FinanceHalf of Americans aren't taking a summer vacation. Here's why How to make sure your summer vacation won't wreck your financesFind out whether you're prepared to handle this hurricane season
Likewise, you want to make sure your cellphone service isn't interrupted.
As more people travel, cellphone companies have started to offer different packages to accommodate them, Hall said.
"It's definitely worth calling and seeing what your options are," she said.
A major health scare at your destination that requires an emergency evacuation could cost you $100,000 or more if you are not covered by insurance, according to Megan Cruz, executive director at the US Travel Insurance Association.
"The wise thing to do is to think about all of the things that can go wrong and think about if you could afford the out-of-pocket expense for them," Cruz said.
The right travel insurance will help cover those medical emergencies and other unexpected developments.
The best way to find the right insurance for you is to shop around, Richter said.
There are many types of coverage depending on variables like when you're traveling and how long you're staying.
"It's always that one scenario where you think everything's going to be fine and you really wish you had protected your investment," Richter said. "Your vacation time is an investment."
Download the mobile app for your airline to keep tabs on your flight status in case of delays or cancellations. "A lot of times if you go on their app and tweet them, you can get quicker service," said Hall.Work with a travel agent. Booking your trip through a professional will not only help you if you encounter problems but can help you find better deals. "A lot of the costs, if they do add a fee, can be recouped and then some," Hall said.If you are traveling abroad, sign up for the State Department's Smart Traveler Enrollment Program, which lets U.S. citizens and nationals share their travel plans with the nearest U.S. embassy or consulate.
"On the Money" airs on CNBC Saturdays at 5:30 a.m. ET, or check listings for air times in local markets.
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bcb9c7540dee49af5a792fedb3654b61 | https://www.cnbc.com/2018/06/01/in-the-world-of-cryptocurrency-even-good-projects-can-go-bad.html | In the world of cryptocurrency, even good projects can go bad | In the world of cryptocurrency, even good projects can go bad
Michael Luckow is one of the creators of the Swiss cryptocurrency start-up Envion, in a co-working space in Berlin, May 30, 2018.Daniel Etter | The New York Times
SAN FRANCISCO — While scams proliferated in the unregulated world of virtual currencies over the last year, a company in Switzerland seemed to be among the more legitimate outfits creating its own cryptocurrency.
The company, Envion, said it had collected $100 million from investors this year with a plan to bring clean energy to the computers that manage Bitcoin. The project was reinforced by partnerships with German businesspeople and politicians and with a German academic institution, as well as by promises of compliance with Swiss and American laws.
But like so many other projects that have pulled in millions of dollars through so-called initial coin offerings, or I.C.O.s, Envion is now melting down, with its creators accusing one another of fraud. The business appears to be in limbo. And investors are bonding on social media about how much they figure they lost on the project.
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Adam Elfarouq, a 29-year-old in Morocco, said he had put $3,000 into Envion and encouraged friends and relatives to invest their money. "I know most of the I.C.O.s out there are either fraud or won't deliver on their promises," he said. Envion, he believed, was different.
The Envion experience is the latest reminder of how the sudden rise of virtual currencies has allowed entrepreneurs to have direct access to investors without regulatory oversight — often with financially disastrous consequences for investors.
Initial coin offerings came out of almost nowhere last year to become one of the most popular ways for start-ups to raise money. Investors threw more than $5 billion at coin offerings last year.
Most projects have raised money by selling custom cryptocurrencies — akin to Bitcoin — that are designed to be used as a method of payment on software the start-ups are building. The hope is that the coins will become more valuable as the software becomes more useful.
But even for the people who work in the virtual-currency world, the complex structure and speed of initial coin offerings make it difficult to separate the good from the bad.
Seif Shieshakly, an adviser to Envion who is based in the United Arab Emirates, said that the I.C.O. structure had "cut out so many middlemen" and created new investment opportunities, but that "the lack of regulations, again because of the infancy of I.C.O.s, carries risks that regulated environments would generally have far less of."
Regulators around the world have scrambled to stay on top of I.C.O.s. China banned coin offerings last year, and the Securities and Exchange Commission in the United States has done a broad sweep of the industry, sending out dozens of subpoenas.
But so far, the authorities have cracked down on only a few projects, and coin offerings have continued at a blazing pace, raising more money so far in 2018 than they did in all of 2017.
Envion tried to separate itself from the flood of scam offerings that have popped up over the last year.
A spokesman for Envion, Chris Pfaff, sent out emails last year saying it was closing deals with IBM and the ruler of Dubai. But Mr. Pfaff said last week that those deals never panned out.
Envion said it would use the money collected from investors to build mobile rigs, filled with computers designed to "mine" or digitally create new Bitcoin. The rigs could be moved between sources of renewable electricity, which would power the mining computers. Envion said people who bought its new tokens would have a right to a share of the new Bitcoins mined.
The founders of the company, about half a dozen programmers and marketers, set it up in Switzerland, and said they were compliant with all the necessary regulations. In one of its many promotional posts on Medium, the Envion team wrote: "As financial regulators across the globe look to regulate I.C.O.s and protect investors, Envion serves as a model for a compliant crowdsale that operates with the same transparency and integrity of traditional financial markets."
A current spokesman for the founders, Laurent Martin, said problems had begun even before the project started fund-raising late last year because of the chief executive the founders brought in, Matthias Woestmann.
According to Mr. Martin, the founders gave Mr. Woestmann what they thought was temporary control of their shares in the company. Mr. Woestmann later refused to give them back, and then diluted the shares of the other owners, providing him with control of the money that was raised.
Mr. Martin said the problems that had come up since then were not caused by the I.C.O. structure. Instead, he said, they are a result of Mr. Woestmann's tactics and his refusal to give back ownership of the company.
"Envion did something truly unique in the way they protected investors," Mr. Martin said. "It's unfortunate that each of these bulwarks is being tested."
In an interview, Mr. Woestmann said he had taken control of the company because the founders created extra Envion tokens to enrich themselves — a claim the founders deny. He has recently made efforts to sell the company to new owners.
Most of the investors on Envion's channel on the messaging service Telegram have sided with the founders against Mr. Woestmann, who they say should either begin building the product that was promised or refund investors.
But large Envion investors who have organized a group online say they distrust the founders as well.
They note that the founders are now led by a man named Michael Luckow, who was never mentioned during the fund-raising process. They complain that the founders let investors buy tokens without providing any information about the turmoil behind the scenes. The investors have also turned up evidence that some of the founders sold their own tokens before the current mess spilled into the public.
"As an investor, this is a horrible situation to be in, as in my point of view both parties are to blame," said Peter Kozak, a 47-year-old in Switzerland who put $55,000 into Envion. "So many questions and no answers."
Mr. Martin said that the tokens had been sold to pay Envion expenses and that Mr. Luckow simply hadn't wanted to take on a more public role early on.
It is still possible that investors will get at least some of their money back. Mr. Woestmann said he still had control of most of the money in the bank, with the founders controlling another chunk.
But he said the funds added up to only $50 million at this point, not the $100 million that the founders had claimed. Mr. Woestmann said the founders hadn't raised as much money as they claimed. And the declining price of virtual currencies has dropped the value of the various digital tokens Envion is holding.
Jessica Smith, a 21-year-old in England, said she had put $28,000 into Envion — almost all of the money she had made over the last two years of trading cryptocurrencies nearly full time. She said she was now looking for new work.
"This has been very painful," she said.
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4e29140aec5ec521c23ce43e533fda54 | https://www.cnbc.com/2018/06/01/jeep-is-doing-almost-freakishly-well.html | Jeep is doing almost freakishly well | Jeep is doing almost freakishly well
VIDEO1:1101:11Ford May sales up 0.7%, Fiat Chrysler sales up 11%Squawk on the Street
Jeep sales are on fire.
The Fiat-Chrysler brand sold almost 100,000 vehicles in May, a nearly 30 percent increase over the same month last year.
That makes May Jeep's second best month for sales ever, behind March, when the brand sold 98,382. Sales dipped in April, but the brand still sold 82,641 vehicles, eclipsing its record April 2016 sales figures.
In 2014, just four years ago, Jeep sold about 1 million vehicles. By the end of this year, it expects to sell as many as 1.9 million.
Despite these sky-high numbers, Fiat-Chrysler CEO Sergio Marchionne thinks Jeep still has more room to run. Marchionne wants to double Jeep's sales worldwide over the next 3-5 years, he said Friday.
Both the the Wrangler, Jeep's renowned off-road vehicle, and the Compass, a smaller crossover SUV, had their best May ever, and helped push Jeep's numbers up. Wrangler sales rose 26 percent to 25,102 vehicles. Sales of the Compass rose sales rose to 17,327 vehicles.
A worker stands next to a Fiat Chrysler Automobiles NV Jeep Wrangler Rubicon automobile on display on the opening day of the 88th Geneva International Motor Show in Geneva, Switzerland, on Tuesday, March 6, 2018.Stefan Wermuth | Bloomberg | Getty Images
The numbers indicate Jeep is performing exceptionally well, while some of FCA's other brands are seeing only slight increases in sales or declines.
Ram Truck sales were up 2 percent in May, and Dodge's sales up 4 percent. Fiat sales dropped 46 percent, and Chrysler sales fell 18 percent.
By 2022, automotive forecaster LMC Automotive expects 97 percent of Fiat-Chrysler's U.S. sales to be some kind of truck, SUV, or crossover, which is an SUV-like vehicle that borrows some attributes of passenger sedans and compact cars.
Jeep is benefiting in part from a larger trend across the industry, as consumers show an ever-growing appetite for trucks and SUVs.
2018 Jeep CompassSource: Fiat Chrysler
But still, Jeep is special, said Kelley Blue Book analyst Rebecca Lindland.
"It's a brand that appeals to everyone across all demographics, all genders, all races," Lindland said.
It also benefits from a fair amount of variety, for a brand that only makes SUVs. The Wrangler is more rugged, while other models, such as the Cherokee, are geared more toward lighter off-roading and urban use.
"As the brand portfolio continues to expand, it will only gain in appeal as it targets more and more consumer cohorts," Lindland said.
Stronger supplies of Jeep vehicles are also playing a role in higher sales, said IHS Markit analyst Stephanie Brinley.
The 2019 Jeep Cherokee is displayed at the North American International Auto Show in Detroit, Michigan, U.S. January 16, 2018.Jonathan Ernst | Reuters
Jeep released the next-generation version of the Wrangler, called the JL, earlier this year. But it is still making the previous version, the JK. FCA also moved production of its Cherokee SUV, to its assembly plant in Belvidere, Illinois, which freed up space for the Wrangler in Jeep's Toledo, Ohio, plant.
"Cherokee also has stronger supply now, as a result of that move and compared to somewhat constrained production at this time last year, and the refresh is also seeing a higher level of advertising to support the launch," she said.
— CNBC's Phil Lebeau contributed to this story
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591536148c66498caf58f6aa771a0737 | https://www.cnbc.com/2018/06/01/koch-political-network-supports-heitkamp-for-bank-deregulation-bill.html | Billionaire Koch brothers' network launches digital ad blitz thanking Democrat Heidi Heitkamp as midterms near | Billionaire Koch brothers' network launches digital ad blitz thanking Democrat Heidi Heitkamp as midterms near
VIDEO1:0901:09Koch brothers' network launch digital ads thanking Democrat Heidi HeitkampNews Videos
North Dakota Democratic Sen. Heidi Heitkamp will be going into the congressional midterm elections knowing she's received support for at least one piece of legislation by the unlikeliest of groups: the Koch political network.
Americans for Prosperity, an arm of the influential network supported by conservative billionaire industrialists Charles and David Koch, is unleashing a digital advertising campaign on Friday thanking Heitkamp for co-sponsoring the Economic Growth, Regulatory Relief and Consumer Protect Act, a bill that rolls back Dodd-Frank regulations mainly on community banks, or those with less than $100 billion in assets. It recently passed in Congress with bipartisan support.
"Congress achieved a significant milestone in lifting some of the toughest restrictions Dodd-Frank placed on small banks and their consumers. This was a bipartisan effort made possible by lawmakers like Heidi Heitkamp who put politics aside to work together," Tim Phillips, president for Americans for Prosperity, said in a statement.
"While we don't agree with Sen. Heitkamp on everything, particularly her vote against tax relief, we commend her for taking a stand against the leaders of her party to do the right thing. We hope to find common ground and work with Sen. Heitkamp on other issues moving forward including making tax relief permanent," he added.
VIDEO7:5607:56The Trump-Russia ties hiding in plain sightDigital Original
The move to support Heitkamp comes only two months after the Koch network launched a six-figure ad buy attacking her for voting against the Republican tax reform bill in December. At the time, Americans for Prosperity put about $450,000 toward the advertising blitz, which ran throughout her state on television and digital outlets. She's one of 10 Senate Democrats seeking re-election this year in states President Donald Trump won during the 2016 presidential election.
But now, Americans for Prosperity is backing Heitkamp, and the aid comes as the network as a whole is looking to push forward its policy initiatives through Congress regardless of party affiliation, including criminal justice reform and protection for those participating in the Deferred Action Childhood Arrivals programs, who are also known as the Dreamers. It is also hoping to make inroads on cutting back on government spending.
"AFP is committed to working with lawmakers — regardless of party — to advance common sense reforms that help people improve their lives. At the same time, we will continue to hold members who voted against this crucial reform accountable," Philips said.
The decision to support Heitkamp for co-sponsoring a deregulation bill could also prove to be a critical moment in the battle for her own Senate seat in North Dakota.
She's facing a challenge by Rep. Kevin Cramer, the only Republican who dared to take on the one-term senator after being reluctant to jump into the race because he originally wanted to focus on defending his own district.
GOP strategists who spoke to CNBC on the condition of anonymity say Cramer could have a rough time if Heitkamp keeps sponsoring and helping pass bills that are not only endorsed by the powerful Koch network but also Trump himself.
One of the president's goals has been to make cutbacks to Dodd-Frank, a bill passed during the Obama administration that imposed stiff regulations on banks across the country after the 2008 financial crisis.
One of its flaws, according to critics and even some supporters, was that smaller banks were struggling under the strict rules. Senators in states with powerful community banking groups were under pressure to loosen those measures.
Sen. Heidi HeitkampOlivia Michael | CNBC
After the bank deregulation bill passed last week, Heitkamp was the only Democrat invited to the bill signing at the White House. She stood next to Trump during the event.
Since Trump was elected, Heitkamp has been one of his few Democratic allies in the Senate. During the presidential transition after the election, she was invited to Trump Tower to discuss a possible cabinet position. In September 2017, Trump brought her to North Dakota on Air Force One and invited her onstage during a tax reform event.
The alliance between Trump and Heitkamp seemed to rile her rival on Wednesday as Cramer took to the North Dakota radio airwaves to declare that "some people in the White House, that think, you know, the president's too friendly with her."
When informed that the Koch network would be thanking Heitkamp for the bank deregulation bill, Cramer told CNBC that the group "should aim higher."
The bill, Cramer says, is a "pretty modest victory compared to the over 40 banking bills the House passed or the Tax Cuts and Jobs Act she voted against. Low bars are easy to step over."
Heitkamp's campaign spokeswoman said in statement that the Senator is focused on delivering for her constituents and distancing herself from partisan politics.
"Heidi got results for rural North Dakota families and businesses who depend on relationship lending because she is and has always been focused on putting partisan politics aside to deliver for North Dakotans -- and that's where her focus will remain," the statement read.
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11420dc292dc1f2017f284861451e886 | https://www.cnbc.com/2018/06/01/lululemon-shares-hit-record-as-first-quarter-profit-beats-expectations.html | Lululemon shares hit record as first-quarter profit beats expectations | Lululemon shares hit record as first-quarter profit beats expectations
Lululemon swimwearSource: Lululemon
Canadian athletic apparel maker Lululemon Athletica posted first-quarter profit that beat expectations on Thursday as revenue jumped 25 percent, sending the company's shares to an all-time high in after-hours trade.
Second-quarter earnings are expected to be between 46 and 48 cents per share on revenue of $660 million to $665 million, the Vancouver-based company said in a statement. That compares with per-share adjusted earnings of 39 cents on revenue of $581.05 million a year earlier.
The stock surged 6.2 percent to $111.51 in after-hours trading, surpassing an intraday record set on Tuesday. That followed a 0.55 percent decline during the day, as the broader S&P 500 index dropped 0.7 percent.
Lululemon, which popularized "athleisure wear" by turning pricey women's yoga wear into mainstream fashion, is navigating a move by consumers to online shopping and growing competition from rivals including Under Armour and Nike. It has fought back by investing in its e-commerce platform and expanding its men's offerings.
A 62 percent increase in revenues from its direct-to-consumer business, which includes online sales, helped drive earnings to 55 cents per share in the quarter ended April 29, compared with analyst estimates of 46 cents, and up from 23 cents a share a year earlier.
Revenue increased to $649.7 million, up from $520.3 million a year ago. Analysts had expected $617.7 million.
The company did not provide an update in the statement about its search for a new chief executive officer following Laurent Potdevin's abrupt departure in February on undisclosed charges of misconduct.
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9d827a4ecbe94d8247a473a7f6ff16ae | https://www.cnbc.com/2018/06/01/may-ism-manufacturing-and-april-construction-spending.html | ISM manufacturing index hits 58.7 in May; construction spending up 1.8% in April | ISM manufacturing index hits 58.7 in May; construction spending up 1.8% in April
A worker uses a machine to polish horsehides at the Horween Leather Co. tannery in Chicago.Christopher Dilts | Bloomberg | Getty Images
Manufacturing activity expanded at a faster pace than forecast last month, according to the Institute of Supply Management.
The ISM manufacturing index jumped to 58.7 in May from 57.3 in April. Economists polled by Reuters expected manufacturing growth to hit 58.4 last month. May also marked the 21st consecutive month of expansion for the manufacturing sector, the data showed.
A reading above 50 for the index indicates expansion in the manufacturing sector, and a reading below 50 signals contraction.
U.S. construction spending rebounded more than expected in April as investment in private construction projects notched its biggest gain since 2012, offsetting a drop in public outlays.
The Commerce Department said on Friday construction spending surged 1.8 percent, the largest increase since January 2016, after an unrevised 1.7 percent decline in March.
Economists polled by Reuters had forecast construction spending rebounding 0.8 percent in April. Construction spending accelerated 7.6 percent on a year-on-year basis.
In April, spending on private construction projects jumped 2.8 percent, the largest increase since January 2012, reversing March's 2.6 percent drop. Outlays on private residential projects shot up 4.5 percent, the biggest rise since November 1993, following a 4.1 percent plunge in March.
Spending on nonresidential structures rose 0.8 percent in April after falling 0.6 percent in the prior month.
Investment in public construction projects decreased 1.3 percent after rising 1.2 percent in March. Spending on federal government construction projects tumbled 10.2 percent. That followed a 1.8 percent increase in March.
—CNBC's Fred Imbert contributed to this report.
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fce2f8ec2c76f153456266a328cc1c4f | https://www.cnbc.com/2018/06/01/national-donut-day-where-to-find-free-doughnuts-and-deals-this-friday.html | National Donut Day: Where to find free doughnuts and deals this Friday | National Donut Day: Where to find free doughnuts and deals this Friday
Paul Johnson | E+ | Getty Images
The debate rages — is it donut or doughnut?
Spelling will take a backseat to savings this Friday for National Doughnut Day — or National Donut Day in some circles.
Shops across the country are marking the day with fried freebies and delectable deals.
Celebrated annually on the first Friday in June, the day of the pastry was established in 1938 to honor The Salvation Army Donut Lassies, women who served the treats to soldiers during World War I.
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"The doughnut was and continues to be a symbol of the comfort and support that The Salvation Army provides to more than 23 million people in need each year," said Lt. Col. Ward Matthews, Salvation Army secretary for national community relations and development in a statement.
Salvation Army USA tweet
This year, the Salvation Army is marking the day with events across the country and has teamed up with Entenmann's to host "Do Good Donut Parties" to deliver treats to more than 8,500 veterans. Find the events at www.salvationarmyusa.org.
Expect doughnut shops and bakeries to be crowded Friday even if they're not giving away free treats.
Brad Plothow, vice president of brand and communications for Womply, a small business software provider, said the made-up holiday is a big day for bakeries.
"People don't spend more but far more people pack into bakeries looking for a treat, resulting in lots more dough for local bakeries," Plothow said.
Participation and offers can vary by location and unless otherwise noted these deals are only available June 1 while supplies last. To be on the safe side, check with your closest location.
BI-LO: Get a 50% discount on all doughnuts in the bakery Friday. Plus through 11 p.m. ET Friday, say why you love doughnuts on the grocer's Facebook page for a chance to win free doughnuts for a year.
Burger King: The fast-food chain is cutting a hole in its Whopper sandwich to create the "first flame-grilled donut" at five select restaurants in New York, Los Angeles, Miami, Boston and Salt Lake City. The Whopper Donut only available Friday comes with a "free" mini slider, which is the donut hole of the burger.
Clinton Hall:Through Friday, get the "Twisted Donut Burger" with a side of fries for $16. The limited-time burger is a twist on the New York restaurant's grilled cheese doughnut and has bacon, jalapenos and Twisted Tea-infused icing.
Cumberland Farms: From 5 a.m. to 10 a.m. Friday, get a free doughnut with the purchase of any dispensed beverage, which includes hot or iced coffee, fountain or frozen beverages. This deal is only valid at new concept or remodeled locations.
The Dough Bar: Through Sunday, the company featured on Shark Tank for making protein doughnuts offers 10% off all orders plus one free doughnut and one free crispy bar. Plus, it has 11 new limited flavors available this week while supplies last.
Duck Donuts: Get one free classic doughnut Friday, including bare, cinnamon sugar or powdered sugar. No purchase necessary and also get a buy-one-get-one-free doughnut coupon redeemable through June 17.
Duffy's Sports Grill: On Friday, get a free order of Red Velvet doughnuts at all locations. Limit one order per table.
Dunkin' Donuts: Get a free classic doughnut of your choice with the purchase of any beverage all day Friday while supplies last.
Dunkin' Donuts tweet
Edible Arrangements: The chain has launched new Edible Donuts made with granny smith apples, chocolate and a variety of toppings. On Friday, get a free doughnut and from June 2-6 any size or combo is buy-one-get-one-free.
Entenmann's: The baked goods brand is accepting entries through June 30 for its Chief Donut Officer Contest at www.chiefdonutofficer.com for the chance to win the honorary title and prizes including $5,000 and a year's supply of donuts.
Fractured Prune Doughnuts: Get get a free "OC Sand" doughnut at participating stores Friday.
Edible Arrangements tweet
Fresco y Más: Get a 50% discount on all doughnuts in the bakery Friday. Plus through 11 p.m. ET Friday, say why you love doughnuts on the store's Facebook page for a chance to win free doughnuts for a year.
Giant Eagle: Get a dozen doughnuts for $3.99 Friday at 175 corporate and 54 independently-owned and operated Market District supermarkets throughout western Pennsylvania, Ohio, north central West Virginia and Maryland. Also, GetGo Café + Market stores will have a buy-one-get-one-free doughnut deal. Both offers require the chain's Advantage Card.
Krispy Kreme tweet
Harveys: Get a 50% discount on all doughnuts in the bakery Friday. Plus through 11 p.m. ET Friday, say why you love doughnuts on the grocer's Facebook page for a chance to win free doughnuts for a year.
Honey Dew Donuts: Get a free S'More Donut with the purchase of any medium or larger beverage Friday at participating locations. Limit one per customer, while supplies last.
Hurts Donut Co.: Anyone who orders a dozen doughnuts Friday will be entered in a contest for a chance to win free dozens for a year. There are also chances to win by liking, commenting, or sharing National Donut Day Facebook videos.
Krispy Kreme: No purchase is necessary to get one free doughnut Friday.
Kwik Trip: Kwik Rewards members get a free Glazer Donut Friday. Limit one per account.
LaMar's Donuts: Get any doughnut with a hole for free on Friday with a Golden Ticket coupon, which you can print or show on your smartphone.
LaMar's Donuts tweet
Martin's Super Market: Get a free doughnut from the case or $1 off a dozen donuts Friday.
McAlister's Deli: June 1 kicks off National Iced Tea Month and the first 20 people in line at each location Friday get a free 32-ounce reusable tea tumbler. Also Friday through June 10, which is National Iced Tea Day, rewards members can get a 32-cent tea with the McAlister's app.
Papa John's: Get a free order of the pizza chain's warm donut holes Friday with any online purchase. Starting June 2, use promo code DONUT for a free order with any purchase of two pizzas.
Papa John's tweet
Potbelly Sandwich Shop: While not a National Doughnut Day deal, June 1 is the chain's 41st birthday and it's offering Potbelly Perks members a free sandwich with purchase of a sandwich. To join, sign up at www.potbelly.com/perks or download the Android or iPhone app.
Rise Biscuits Donuts: All locations will donate 100% of Friday's sales of the Chocolate Icing Donut to a local food bank.
Shipley Do-Nuts: Get one free glazed donut Friday from 5 a.m. to noon for what the Texas-based chain is calling "National Do-Nut Day."
Speedway: According to the chain's Facebook page, Speedy Rewards members get a free doughnut through Sunday with their loyalty card and a coupon available to print or access on the Facebook page. While supplies last.
Tim Hortons U.S. tweet
Sugar Shack Donuts & Coffee: The Virginia-based chain offers a daily freebie with varying requirements. Recent examples include a free house donut for those whose name started with W or for wearing College Alma Mater swag. Find out the daily freebie on Sugar Shack's social media accounts.
Tim Hortons: Only five U.S. locations will have "Gold Timbits" and the first guest to ask for them after 6 a.m. Friday at the select locations will get the edible 24k gold-covered Timbits for free and win free doughnuts for a year. It's a hunt to find the locations but company officials say they're in the Detroit, Columbus, Ohio, and Buffalo, N.Y.
Walmart: Get one free glazed doughnut at all Walmart stores Friday. The retailer expects to give away 1.2 million doughnuts Friday.
Winn-Dixie: Get a 50% discount on all doughnuts in the bakery Friday. Plus through 11 p.m. ET Friday, say why you love doughnuts on the grocer's Facebook page for a chance to win free doughnuts for a year.
More deals: Locally-owned businesses and smaller chains also may have deals Friday. One of the easiest ways to find out is to check social media channels.
If you don't have the patience to stand in line at busy doughnut shops Friday, here's another way to save some dough.
The Coupons.com mobile app has a rebate offer at Target and Walmart on Friday.
With the app, you can earn up to $3 cash back on doughnut purchases at the two retailers. The first step is to clip the coupon in the app and then scan the receipt after you checkout.
The money will be deposited into your PayPal account.
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44dc5000d7b8fb9e79168e9739f7d53d | https://www.cnbc.com/2018/06/01/noom-fitbit-and-others-improve-weight-diet-and-physical-activity.html | The key to weight loss may be right in the palm of your hand | The key to weight loss may be right in the palm of your hand
Getty Images
If you're one of the 97 million dieters in the United States, you're likely familiar with the relentless battle to lose weight as well as its accompanying refrain: Eat less and exercise more. This ongoing struggle has fed the growth of diets from the doable to the dangerous, and exercise regimens from the reasonable to the ridiculous.
The growth of obesity in America is expanding as fast as our waistlines: According to the Centers for Disease Control and Prevention, more than one-third of American adults are obese. That means that roughly 36 percent of the population has a body mass index (BMI) over 30, putting them at risk for heart disease, stroke, type-2 diabetes and various cancers.
As if that isn't bad enough, an obese person spends roughly 42 percent more in medical costs than does a person of healthy weight, putting an enormous strain on America's already-bloated health-care system. And they are spending billions on commercial weight-loss plans as well: In 2017 diet plans such as Jenny Craig, Weight Watchers, Nutrisystem and others totaled $3.03 billion, according to Marketdata LLC, a market research firm that has been tracking the U.S. weight-loss market since 1989.
It's evident we're losing our battle with obesity: According to Marketdata's president, John LaRosa, "The number of active dieters is estimated to have fallen 10 percent since 2015, to 97 million, due to a growing-size acceptance movement and dieter fatigue. About 80 percent try to lose weight by themselves, but many fail, and the latest CDC statistics show that we are getting fatter, not thinner."
Many people don't know the specifics of what to eat and how to exercise. We don't automatically learn these things in school, nor from our parents or others in our lives.Scott KahanM.D., director of the National Center for Weight and Wellness in Washington, D.C.
The struggle is real. "Many people don't know the specifics of what to eat and how to exercise," said Scott Kahan, M.D., director of the National Center for Weight and Wellness in Washington, D.C. "We don't automatically learn these things in school, nor from our parents or others in our lives." And the people we look to for guidance are not always well informed, either: Most medical schools don't provide budding doctors with education on practical nutrition, physical activity or weight management, he said.
But here's the rub: Knowing what to do by itself is just not enough. "To lose weight and keep it off, having practical approaches for changing our behavior is central," said Kahan.
So what's the best solution for those struggling to get their weight under control? Embark on a commercial weight-loss program? Take an anti-obesity medication? Enroll at a medical weight-loss clinic? Limit yourself to a meal-replacement shake or nutrition bar? All the noise out there makes it very challenging to know who or what to listen to and what approach to take, noted Kahan.
One possible solution to reduce that noise might already be in the palm of your hand. LoseIt!, MyFitnessPal, SparkPeople, Noom and Fitbit are just a few of the more than 20,000 weight-loss apps on the market available for download that give dieters the ability to be active participants in their struggle to lose weight. Such apps that take a lifestyle-intervention approach allow users to log and track their progress and to access helpful educational resources to support their weight-loss goals.
Scientific evidence supports the finding that mobile apps can be effective in the fight against obesity. A 2016 study published in the Journal of Medical Internet Research that reviewed close to 400 apps found that compared to standard approaches to weight loss, app users could more effectively improve their weight, diet and physical activity.
With Noom users can keep a food diary, log their exercise, learn to deal with eating triggers and get social support and one-on-one individual and group coaching.Source: Noom
Artem Petakov, co-founder and president of Noom, which has 45 million active users, described the app as a "behavior-change platform." Its users can keep a food diary, log their exercise, learn to deal with eating triggers and get social support and one-on-one individual and group coaching. There's even a virtual coach who can keep an eye on and provide feedback and teach users valuable lessons, such as how to recover from falling off track — a common pitfall for dieters everywhere.
Various scientific studies have demonstrated Noom's success as a useful tool for losing weight and keeping it off. Noom also offers a separate Diabetes Prevention Program. In a study published in BMJ Open Diabetes Research and Care, Noom's program helped 64 percent of its participants lose more than 5 percent of their weight. These results were comparable to the CDC's findings from the traditional diabetes prevention program, which helps prevent or delay the onset of type-2 diabetes.
Another app, called Nudge, syncs up with the data from other leading apps, like Moves, Runkeeper and Apple Health, to help you stay on top of your weight-loss goals. It even gives you recommendations for what you need to do more of, and you can join social clubs, where you can link up with other Nudge users for advice and support. If you need more of a push, it will also connect you with a personal coach.
Jose Luis Pelaez Inc | Getty Images
"Having a weight-loss app on your phone is like having a string around your finger reminding you to act," said lifestyle expert Jeff Halevy, former Today Show fitness correspondent and founder of HLVY Group, which includes a portfolio of companies spanning health club operation, technology, media and content creation and more.
"We live in the information age, but information is not always enough. Apps are something bigger than ourselves, allowing for a sense of community, recognition, accomplishment and sharing," he said.
— By Sheryl Kraft, special to CNBC.com
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e1d53f8ead76733db28b825ea470b2ed | https://www.cnbc.com/2018/06/01/petrobras-shares-tumble-after-company-says-ceo-parente-resigned.html | Petrobras shares plunge 20% after CEO Pedro Parente resigns amid strikes | Petrobras shares plunge 20% after CEO Pedro Parente resigns amid strikes
VIDEO0:4600:46Petrobras CEO Pedro Parente has resigned from his postNews Videos
Pedro Parente, the chief executive officer of Brazil's state-controlled oil producer Petroleo Brasileiro, resigned his post on Friday after a nationwide trucker strike forced the government to lower diesel prices.
The resignation comes as Brazilian oil workers begin a three-day strike. Unions demanded that Parente step down and called for an end to a policy of allowing the market to set the price of fuel.
VIDEO0:5200:52Petrobras plunges on reports of CEO Pedro Parente resignationSquawk on the Street
Shares of the company, commonly called Petrobras, were down more than 20 percent in midday trading on Friday following the resignation. Shares in Sao Paulo were suspended after Parente's resignation.
In a statement, the company said the board will choose an interim CEO on Friday and that the company's other top executives will remain.
In his resignation letter, Parente said that he "delivered what he promised" when he took over Petrobras two years ago.
However, Parente said his presence in the company is no longer positive in light of the trucker strike, which ground the nation's economy to a halt.
Petrobras unveiled a plan last June to review fuel prices more frequently. For nearly a year, the company has been allowing prices to fluctuate with international benchmark crude futures.
Fuel prices have surged in Brazil as oil futures hit 3½-year highs above $80 a barrel, stoking a wave of discontent across the country. Parente said the strikes had put "the Petrobras price policy under intense questioning."
Pedro Parente, President of Brazil's state-run oil company Petroleo Brasileiro SA (Petrobras), attends a news conference in Rio de Janeiro, Brazil May 8, 2018.Sergio Moraes | Reuters
Since taking the helm of Petrobras in May 2016, Parente has been at the fore of an effort to turn around the Brazilian energy giant. Petrobras became the world's most indebted oil company amid a corruption scandal that gripped the country and led to the imprisonment of former President Luiz Inacio Lula da Silva.
Under Parente, the company has begun to chip away at its massive debt load, which stood at 270.71 billion reais, or $76.23 billion, in the first quarter of 2018, Reuters reported. The company posted its biggest quarterly profit in five years during the quarter, according to the news agency.
Parente put an emphasis on exploiting crude oil production off the coast of Brazil located under thousands of feet of salt. Last November, he told CNBC that the high productivity and low cost of extracting this so-called pre-salt production would be a critical to keeping Petrobras competitive.
VIDEO3:2403:24Petrobras CEO: We see $55-$65 oil in the medium termSquawk on the Street
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ea2e7c6f57bfe38fe945e238adc1d54e | https://www.cnbc.com/2018/06/01/ron-conway-one-of-techs-top-power-brokers-is-scaling-back-investing.html | One of San Francisco's top tech power brokers is taking a step back from tech investing | One of San Francisco's top tech power brokers is taking a step back from tech investing
Ron Conway, founder of SV AngelNoah berger | Bloomberg | Getty Images
Ron Conway, one of San Francisco's top tech power brokers, is taking a step back from tech investing.
SV Angel, an early-stage venture capital firm founded by Conway, said Thursday it won't be raising another fund.
Conway and his son Topher will continue to invest under the SV Angel name, on a smaller scale and with their own personal funds, according to a blog post announcing the scaling back.
"The amount of money raised in seed rounds has doubled and valuations have increased significantly," the post reads. "As we thought about how best to serve founders in this environment, we also realized we no longer need to write big checks in order to help."
Capital has flooded into Silicon Valley in recent years, bolstered in part by investing machines like Japanese conglomerate SoftBank. Tech start-ups are posting sky-high valuations and delaying IPOs.
"Writing smaller checks allows us to stay true to our DNA, remain nimble and fulfill our commitment to supporting founders," the SV Angel team wrote. "We know that if we continue to get behind the right people, success for us and the founders we support will follow."
SV Angel counts early-stage investments in tech giants like Twitter, Pinterest, Airbnb and Square. General partners at the firm Brian Pokorny, Kevin Carter and Robert Pollak will move into advising roles.
VIDEO1:5501:555 strategies you should use to protect your portfolioDigital Original
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7c16a67a7284045029eca5a87eec7a77 | https://www.cnbc.com/2018/06/01/spain-mariano-rajoy-ousted-in-no-confidence-vote.html | Spain’s leader Rajoy ousted in no-confidence vote with socialist party gaining power | Spain’s leader Rajoy ousted in no-confidence vote with socialist party gaining power
VIDEO1:1901:19Spain's Rajoy replaced with center-left leaderSquawk Box
Spain has a new prime minister after a parliamentary vote Friday led to the ousting of incumbent Mariano Rajoy.
Speaking to the Spanish parliament just before the vote, Rajoy said he would accept the result and wanted to be the first to congratulate the leader of the opposition Socialist Party, Pedro Sanchez, as his successor.
A long-running corruption trial — known as the Gurtel case — found dozens of people linked to Rajoy's governing People's Party (PP) guilty of benefiting from illegal kickbacks. That prompted Sanchez to push for a vote of no-confidence against Rajoy.
Sanchez won the vote Friday after securing the backing of six smaller parties, including that of the Basque Nationalist Party and two parties that support Catalan independence. The left-of-center Podemos party also said it would back Sanchez.
Spain's Socialist Party (PSOE) leader Pedro Sanchez attends an investiture debate at parliament in Madrid, Spain, March 2, 2016.Andrea Comas | Reuters
Ciudadanos, a right-of-center party that enjoys strong support in Spain, refused to back the new coalition.
Market reaction has been mildly supportive. The Spanish , which accounts for the country's largest listed companies, was higher by almost 2 percent on Friday morning.
The euro was largely flat against the dollar while Spanish bond prices ticked higher. Spain's political upheaval is viewed by investors as more favorable than neighboring Italy's as most Spanish parties cast themselves as pro-European.
The socialist leader Sanchez has promised to stick to a budget recently approved by parliament and with pure control of only 84 of 350 seats, enacting change is seen as difficult. The next general election in Spain is due to take place by mid-2020.
VIDEO3:5403:54There's a perfect storm in the Spanish parliament, lawmaker saysSquawk Box Europe
Jose Ramon Garcia-Hernandez is an MP & International Spokesperson for Rajoy's Partido Popular.
He told CNBC's Squawk Box Europe on Friday that today's vote would cause a political upheaval.
"It looks like we are going to have the perfect storm in parliament. What we have seen today is unprecedented in Spanish constitutional history and I think it is going to put a big doubt over the new government's future," he said.
Ciudadanos is the largest party in the polls but will have no role in the new government. An economic advisor to Ciudadanos, Luis Garicano, said the new "Frankenstein coalition" would bring a risk to Spanish budgetary responsibility.
"The only thing that will hold this strange coalition together will be removing some constraints that were imposed by Europe and budget responsibility," he told CNBC's "Street Signs."
Garicano added that he expected the new government to be a test of Spanish unity.
VIDEO0:4000:40Analyst: Spain is going through period of political changeStreet Signs Europe
Also speaking Friday, Antonio Barroso, managing director of Teneo Intelligence, said he agreed that the new leader would have a difficult time holding the new administration together.
On the particular issue of Catalonian independence, Barroso said there would be a change in tone from the incoming administration, but there would be no solution for both sides.
"The problem that we have in Catalonia is one of massive polarization that has been caused by the pro-independence movement," he told CNBC's "Street Signs."
"As long you have a government in Catalonia that tries to defy the constitutional order, I don't think that Sanchez will have any willingness to negotiate."
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4c203840f2c6e85bb75d4a4fa71fce14 | https://www.cnbc.com/2018/06/01/tesla-factory-paint-shop-fires-worse-than-revealed-workers.html?__source=OTS%7Cfinance%7Cinline%7Cstory%7C&par=OTS&doc=106853035 | Tesla workers say factory paint shop has had multiple fires, causing more problems than Tesla let on | Tesla workers say factory paint shop has had multiple fires, causing more problems than Tesla let on
An employee works on a Telsa Motors Model S sedan as it makes its way along an assembly line at company's assembly plant in Fremont, California.Noah Berger | Bloomberg | Getty Images
Tesla has had at least four fires in the paint shop at its Fremont, California, factory since 2014, according to five people familiar with operations at that plant.
One previously reported fire, in April, was serious enough to stop Model 3 production for multiple shifts that week, these people said. Another fire took place in January 2016 and caused at least a day of suspended vehicle production. Both fires damaged expensive equipment.
These people blamed the fires in part on improper cleaning, maintenance and insufficient training for new employees in the face of high pressure to meet production goals. Two current employees said they were concerned about their health because of fire hazards and poor air quality. All the people agreed that the April fire contributed to slowing down Model 3 production.
A Tesla spokesperson denied that the April fire was "significant" or had any impact on Model 3 production, and said:
"In recent months, we have further enhanced the safety and efficiency of our paint shop, including significant upgrades to equipment, as well as an extensive maintenance effort involving cleaning and calibration. In order to protect the health of our employees, we also conduct regular air monitoring and have proper ventilation and personal protective equipment for everyone who works in the paint shop."
Tesla's future as a mass-market carmaker hinges on efficient, high volume production of the Model 3, the company's lowest-priced offering so far. When Tesla unveiled the Model 3 in 2016, CEO Elon Musk said it would be able to produce 100,000 to 200,000 Model 3 cars by the end of 2017 with a base price of $35,000.
Instead, Tesla produced just 2,685 Model 3s in total for all of 2017.
Tesla also missed its goal of producing 2,500 Model 3s per week by March 31, 2018. So far, the company has sold only premium versions of the Model 3, which cost $44,000 to $78,000.
Paint shop issues are still hampering Tesla's progress with Model 3 production, according to current employees and other people familiar with Tesla's paint shop. They requested anonymity because they have not been authorized to speak to the media.
The first deliveries of the Tesla Model 3 on July 29, 2017.Alexis Georgeson | Harvest Films
When a paint shop fire halted vehicle production around 7 a.m. on April 3, a Tesla spokesperson said the fire was "small" and extinguished by internal teams in a matter of seconds.
But employees told CNBC the fire was significant enough to stop work for at least a full shift on that day. The shop was also shut down for at least one more shift two days later. It also forced Tesla to decommission two burnt sprayer robots that they estimated were worth over $1 million.
The fire happened just after the company's head of vehicle engineering, Doug Field, who is now on leave, sent out an e-mail encouraging employees to "prove the haters wrong." In that spirit, and under management's direction, paint shop crews worked on.
The week of the fire, according to two employees and two other people familiar with Tesla's Fremont factory, Musk showed up to assess damage to the paint shop. The fire had burnt an entire zone dedicated to painting Model 3s.
Rather than suspending operations immediately, Musk and others encouraged teams to fix what they could and push through.
Some Model 3 parts, including B-pillars and chassis components, which had been in the paint shop at the time, were moved into a containment area, visually inspected and put back into production, rather than being scrapped or further tested for damages, employees said.
Tesla emphasized that no damaged parts were used in new vehicle production.
Engineers scrambled to repurpose equipment in the paint shop that week so that robots could be used to put primer on both the interior and exterior surfaces of Model 3 vehicles. Before the fire, separate robots handled interior and exterior primer application.
Tesla handled the April 3 fire with its own internal brigade. It did not report it to the Fremont Fire Department, a spokesperson for the department confirmed.
However, a citizen did call after seeing reports about the fire on social media that day, the fire department spokesperson said. Tesla security greeted a fire department battalion chief who went to investigate and said the department had no internal reports of fire at the facility, the spokesperson said. The chief toured the exterior of the Fremont factory looking for signs of fire, and seeing nothing but a "cloud formation" outside, left without going inside, according to the spokesperson.
A week and a half later, Tesla announced it was shutting down its Fremont factory operations temporarily to make some improvements. (Tesla also shut down its factory for a week in May for planned upgrades.)
VIDEO0:4600:46Elon Musk announces he’s reorganizing TeslaNews Videos
Fires like these are not common in auto manufacturing. It is especially uncommon for a plant to have multiple fires in a paint shop.
According to the most recent available data from the National Fire Protection Association, local fire departments respond to 190 fires per year on average in maintenance or paint shop areas of factories and processing facilities. That is just 4 percent of fires that occur in all of manufacturing.
The rate of paint-shop fires in auto plants is far lower than that, says Jason Reason, a former OSHA officer and senior vice president of safety and health at Lewellyn Technology in Indiana.
"For the most part, corporations know how to control fire hazards associated with spraying operations, and work to establish a safety culture," said Reason. "If you're having multiple fires, you really need to audit your paint shop and make sure it never happens again, even if that means redesigning the whole thing."
A spokesperson for GM manufacturing, Dan Flores, noted: "At GM, we would consider a fire in a paint shop an extremely rare occurrence — that's because our paint shops operate in a very controlled manner."
Two Tesla employees say that vehicle production goals have been the highest priority in recent months, sometimes at the expense of fire and environmental considerations. They said, for example, that months before the April fire, the sprinkler heads were clogged and coated at least an inch thick of paint and clear-coat. Filters below the paint booths and exhaust systems that clean and carry air into and out of the building were also visibly coated, they added.
A former paint shop employee said associates there are given minimal training — just what they need to meet OSHA safety requirements — before they are put to work on jobs that need more specialized skills. The result is that while Tesla has invested in state-of-the-art equipment, these inexperienced employees don't follow best practices. The result: botched jobs and a potentially unsafe environment, according to the former employee, who spoke on condition of anonymity.
Workers are hopeful things may soon change. Since early April, Tesla has replaced some sprinkler heads, and put out a request for quotes on new air filtration equipment.
On a tense earnings call in May, Musk plainly acknowledged that the paint shop at Tesla's Fremont factory poses a risk to mass-production of the Model 3 electric sedan.
The CEO said: "General assembly is probably our biggest risk, and I'm refocusing personally on that a lot in the next — in the coming month. And then our paint shop is maybe the second biggest risk after general assembly."
On the same call, he sought to assure analysts "[It's] not like you need brain surgery to get these things right."
VIDEO3:4903:49Elon Musk's 'bizarre theatrics'Power Lunch
Here is Tesla's full statement to CNBC:
"In recent months, we have further enhanced the safety and efficiency of our paint shop, including significant upgrades to equipment, as well as an extensive maintenance effort involving cleaning and calibration. In order to protect the health of our employees, we also conduct regular air monitoring and have proper ventilation and personal protective equipment for everyone who works in the paint shop. As was previously reported, we experienced a fire in our paint shop in April, though it was quickly extinguished and did not materially impact production. As part of this event, we immediately mobilized an internal team to learn from the event and we're confident that the steps we're taking will prevent similar events from occurring in the future. We put a lot of effort into this endeavor and are very proud of this team's work. "
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25d4e3d2efb5d89689ab4268086bded4 | https://www.cnbc.com/2018/06/01/trump-after-granting-a-big-concession-to-north-korea-is-left-waiting-for-kim-to-return-the-favor.html | Trump, after granting a big concession to North Korea, is left waiting for Kim to return the favor | Trump, after granting a big concession to North Korea, is left waiting for Kim to return the favor
President Donald Trump gestures toward journalists shouting questions as he departs the White House May 29, 2018 in Washington, DC.Getty Images
The world can welcome news that President Trump's summit with Kim Jong-un is back on – but only a little. Nearly everyone prefers diplomacy to threats of nuclear war. Trump won't travel to Singapore on June 12 to exchange hostile words with his North Korean counterpart. But on the overriding American priority of eliminating Pyongyang's nuclear weapons program, there's still no sign of major breakthroughs anytime soon. And by reinstating the face-to-face session he earlier cancelled, Trump has already granted a concession prized by North Korean leaders for years. The president's words today usefully re-balanced expectations that had sailed out of control. Abandoning the idea he'll persuade Kim to rapidly "denuclearize," Trump described the summit as merely a "get-to-know-you" session to be followed by additional meetings. Since experts doubt North Korea has any intention of surrendering all its nuclear weapons, that re-calibration reduces risks of a summit ending badly and escalating tensions anew.
VIDEO2:5502:55Trump: Relationship with North Korea as good as it's been in a long timePower Lunch
Yet Trump, veering sharply in the opposite direction, gave no indication that North Korea is prepared to make any concrete concessions at all. The president said the meeting would produce no formal, signed agreement. He didn't raise North Korea's notorious human rights violations in Friday's lengthy Oval Office chat with Kim's top deputy. Because "we're talking so nicely," Trump told reporters he's withholding additional planned sanctions on Pyongyang. He even renounced the signature shorthand for his entire North Korea policy. "I don't want to use the term 'maximum pressure' anymore," Trump explained. "We're getting along." His softer new tone, just a week ago after scuttling the session with a warning for Kim about America's "massive and powerful" nuclear arsenal, took some veteran national security officials aback. "Astounding," former U.S. Ambassador to North Korea Chris Hill told me. "There seems absolutely no commitment to denuke, or anything else." That led former Obama White House official Ned Price to say that Kim has gained an early upper-hand over an American president who boasts of his deal-making skills. Like his predecessors, the North Korea dictator has viewed a one-on-one summit as a valuable elevation in international status – all the more significant now that he possesses nuclear weapons. Indeed, the leader of Trump's party in the Senate voiced concern before the White House re-scheduled the summit. If you "want the deal too much," Mitch McConnell warned, "you could get snookered." Given decades of frustration with North Korea policy, others were relieved simply to have talks revived at all. "Hopefully the start of a long process," said Richard Haass, a former adviser to George W. Bush now at the Council on Foreign Relations. "Periodically it's necessary to test the diplomacy," added James Steinberg, a national security advisor to presidents Clinton and Obama. "I'm not awarding any Nobel prizes yet," concluded Michael O'Hanlon, who also served in the Clinton White House. "But compared with the real risks of nuclear war, I am encouraged." As for fears that Trump has given too much for too little, one conservative foreign policy specialist insisted that standards for his predecessors simply don't apply to the blustery former real estate tycoon. "Yes, if the president is a normal president," explained Danielle Pletka of the American Enterprise Institute. "But in this case, I'd say a meeting is just a meeting." —By CNBC's John Harwood. Follow him on Twitter: @JohnJHarwood
VIDEO1:3401:34Trump: North Korea summit will be held on June 12Power Lunch
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4c5ad69e8c7973adbf55f94564a759c7 | https://www.cnbc.com/2018/06/01/trump-tariffs-will-shrink-savings-americans-gained-from-tax-cuts.html | Trump's tariffs on US allies will shrink the savings Americans gained from tax cuts | Trump's tariffs on US allies will shrink the savings Americans gained from tax cuts
VIDEO0:5300:53'Decent chance' Trump's tariffs against US allies could result in trade pact with China, says former CEA chairmanSquawk Box
President Donald Trump has embarked on an unorthodox follow-up to cutting the taxes American families pay: raising the prices of goods they buy.
Higher prices will result directly from tariffs the White House plans to impose on steel and aluminum imports from allies such as Canada, Mexico and the European Union as well as other countries. The White House acknowledges that effect, while arguing the price increases will be tiny.
But combined with additional tariffs against other imports from China and retaliatory steps by our trading partners, the measures Trump announced promise to make an impact. And mainstream economists across the political spectrum agree it will be negative.
"Unambiguously bad," said Douglas Holtz-Eakin, a Republican economist who advised President George W. Bush. "The only question is how big."
"Anything that's manufactured — prices will rise," added Mark Zandi, an independent economist at Moody's Analytics.
Zandi estimated the net effects of trade conflicts Trump has initiated at 0.2 percent in reduced economic growth, 250,000 in lost jobs, and $210 in higher costs for an average family. Such a reduction in growth would wipe out half the projected boost in growth from the tax cuts Trump and the GOP Congress enacted last December.
Trump concedes his trade policies will cause "a little pain." But he insists that 25 percent steel and 10 percent aluminum tariffs will benefit the country by boosting the domestic manufacturing of building-block products crucial to economic vitality and national security.
His argument collides with 21st century economic reality in multiple ways.
First, the number one source of U.S. steel imports is Canada, the closest of economic and national security allies. An indignant Prime Minister noted Canada's side-by-side cooperation in, among other crucial U.S. battles, the Normandy invasion of World War II. The next three biggest sources are friendly Brazil, South Korea and Mexico.
Second, as past tariff experiences have shown, jobs lost in industries that pay more for steel and aluminum inputs (think cars and beer cans) will far outnumber those gained from tariff protection for steel and aluminum manufacturing.
Third, counter-tariffs by trading partners will damage American export sectors such as agriculture — exports that disproportionately benefit Trump-allied heartland states represented by fellow Republicans. Sen. Ben Sasse of Nebraska, echoing other GOP lawmakers, observed simply, "This is dumb."
"They're just not doing the economic arithmetic correctly," Holtz-Eakin said.
The arithmetic could get worse. Also in the name of national security, the Trump administration is investigating whether to slap 25 percent tariffs on imported cars.
That would boost prices of products on which Americans spent $180 billion in 2017. There's no assurance the expensive cycle of tariff escalation would stop there.
Overall, inflation in consumer prices remains modest. In an economy that has reached full employment, wages are growing slightly faster.
Yet the working-class Americans that candidate Trump courted so intently face the burden of gas prices that have risen sharply since last year. Average pump prices nationally, which averaged $2.45 per gallon as he took office, reached $2.98 in May.
Zandi calculates that the average American family will pay roughly $320 more this year as a result. Combined with higher prices due to tariffs, that would wipe out more than half the average tax cut of $930 that families in the middle 20 percent of American earners would receive in 2018, according to the Tax Policy Center.
And it would make net losers of families earning less than that. The Tax Policy Center estimates that the bottom 20 percent of earners will receive an average tax cut of just $60 this year; the 20 percent of earners above them, just $380.
Uncertainty over the economic consequences adds risks to business investment and unsettles financial markets. The S&P 500, Nasdaq and Dow Jones industrial average all closed lower Thursday following the tariff announcements.
That underscored one thing that Trump's 2018 economic policies have helped make cheaper: stocks. For the first five months of the year, the Dow is down 409 points, or 1.6 percent.
VIDEO2:2202:22US tariffs on Canada, Mexico and EU take effectSquawk on the Street
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e7cd1a26b616210927b23a00b7147dc0 | https://www.cnbc.com/2018/06/02/delta-is-investigating-the-death-of-a-pomeranian-it-flew-to-detroit.html | Delta is investigating the death of a Pomeranian it flew to Detroit | Delta is investigating the death of a Pomeranian it flew to Detroit
Getty Images
Delta Air Lines said on Saturday it is investigating the death of a dog that died after it traveled in one of its plane's cargo holds during a cross-country flight.
Alejandro, a Pomeranian, was traveling from Phoenix to Newark via Detroit this week, where he was found dead.
An attorney for the Pomeranian's owner, Evan Oshan, who also represented the family of Kokito the French bulldog that died on the United flight, told NBC 4 New York that the dog's owner is trying to retrieve Alejandro's remains.
"We know pets are an important member of the family and we are focused on the well-being of all animals we transport," Delta in a statement.
"Delta is conducting a thorough review of the situation and have been working directly with Alejandro's family to support them however we can," the airline said. "As part of that review, we want to find out more about why this may have occurred to ensure it doesn't happen again and we have offered to have Alejandro evaluated by a veterinarian to learn more."
Pet transportation on airlines has drawn more scrutiny in recent months, after several deaths of animals that were en route to their destinations died. The increased attention takes place against a backdrop of a surging number of animals traveling in cabins.
United Airlines last month said it would no longer accept animals other than cats and dogs, and banned dozens of dog breeds from its cargo hold. That change followed the death of a French bulldog puppy that died after it was placed in an overhead bin, and two other dogs that the airline flew to the wrong destinations.
U.S. airlines transported 506,994 animals last year, according to the Department of Transportation. Delta carried 57,479 animals in 2017, and said two of them died.
Correction: This story has been updated to show the dog died after it flew in the plane's cargo hold. A previous version said the dog died in the cargo hold.
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523419bafd17000359eca8003f371f7c | https://www.cnbc.com/2018/06/02/seoul-tokyo-clash-onhow-north-korea-should-remove-its-missiles.html | Seoul, Tokyo clash on how North Korea should remove its missiles | Seoul, Tokyo clash on how North Korea should remove its missiles
Japan's Defense Minister Itsunori Onodera (L) shakes hands with his South Korean counterpart Song Young-moo (R) as director-general and chief executive of the International Institute for Strategic Studies (IISS) John Chipman looks on during the second plenary session of the 17th Asian Security Summit of the IISS Shangri-La Dialogue in Singapore on June 2, 2018.Roslan Rahman | AFP | Getty Images
Seoul and Tokyo hold nuanced but crucial differences regarding North Korea's potential weapons dismantlement, it emerged Saturday.
Speaking at the Shangri-La Dialogue, an annual Singapore summit that draws security officials from across the globe, Japanese Defense Minister Itsunori Onodera and South Korean Minister of National Defense Song Young-moo appeared to clash over the urgency in removing Pyongyang's short-range ballistic missiles.
Song placed low emphasis on their immediate removal, noting their threat "will dissipate over time" as the North forms relations with the international community.
Onodera, however, took a tougher stance. Short-range missiles are a big priority for the world's third-largest economy, he said, adding that they must be an essential and timely component in the elimination of all North Korean missiles.
Those diverging views indicate just how complex the dismantlement process could be if the rogue state agrees to relinquish weapons at leader Kim Jong Un's June 12 meeting with President Donald Trump. If the summit achieves success, it will be comparable to the 1989 Malta summit that brought an end to the Cold War, according to Song.
The South Korean official offered a broadly optimistic take on ongoing nuclear negotiations, stating that "just because we have been tricked by North Korea in the past doesn't guarantee that we will be tricked in the future." He also called on the world to trust North Korean ruler Kim. "If we continue to suspect his motives, then any moves towards goals will be hindered by those suspicions."
Onodera, in contrast, pointed out the North's history of lies and broken commitments, warning that the sanctions-riddled nation should not be rewarded solely for dialogue. Pressure must remain in place, he said.
And if Kim's administration really is serious about scrapping weapons, Onodera said that Tokyo is ready to provide resources for inspections and verification as well as ensuring safe disposal so weapons don't spread to other countries.
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6027b5feae4a5f84bc9c1415eec0e08b | https://www.cnbc.com/2018/06/03/forex-dollar-in-focus-after-upbeat-us-jobs-report-outlook-murky.html | Dollar sinks to 2-week low on renewed trade concerns, easing Italy risks | Dollar sinks to 2-week low on renewed trade concerns, easing Italy risks
Getty Images
The dollar fell to a two-week low on Monday, as the easing of political tensions in Italy lifted the euro and as global trade concerns resurfaced after China warned the United States against tariffs or other protectionist measures.
"With European political drama retreating from the brink, the peak in the dollar index was likely observed at 95," said Mazen Issa, senior FX strategist, at TD Securities in New York. Lingering trade disputes will also contribute to a challenging backdrop for the U.S. dollar in the weeks ahead, he added.
"The U.S. administration appears uncoordinated and unprepared with a global effort - that now includes China - throwing its hat in the ring of retaliation and withdrawal of a principled agreement to buy more U.S. goods should the U.S. decide to go through with purported tariffs later this month," Issa said.
The official Chinese news agency Xinhua reported on Sunday that if the United States introduces trade sanctions including raising tariffs, all the economic and trade achievements negotiated by the two parties a few weeks ago will be void.
In mid-morning trading, the dollar index fell 0.16 percent to 94.04, hitting a two-week trough of 93.664. The dollar fell on Friday despite a strong U.S. non-farm payrolls report, suggesting the greenback has been looking stretched after gaining consistently since mid-April.
Better-than-expected U.S. jobs data last week underlined the strength of the U.S. economy and the near-certainty of a Federal Reserve interest rate rise this month and probably a fourth hike this year, factors which have lifted the dollar.
But the euro clawed back some gains as Italy took steps to form a new government and as German Chancellor Angela Merkel said over the weekend that Germany favored moves toward a European Monetary Fund.
The single currency was last up 0.3 percent at $1.1695, after rising as high as $1.1737, its highest since May 24, pulling further away from 2018 lows of $1.151 last week.
The surged to its highest since April on an improvement in broader risk sentiment and domestic data showing strong company profits and a rise in retail sales. The Aussie rose to US$0.7651, on track for its biggest one day-rise since August.
VIDEO2:4502:45Look out for the 'strength of the dollar,' says investor
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3b3bc91f543732ec530783cdb781eb62 | https://www.cnbc.com/2018/06/03/us-ambassador-to-germany-wants-to-empower-conservatives-in-europe.html | US ambassador to Germany says he wants to 'empower' conservatives in Europe | US ambassador to Germany says he wants to 'empower' conservatives in Europe
U.S. Ambassador to Germany Richard GrenellOdd Andersen | AFP | Getty Images
U.S. Ambassador to Germany Richard Grenell said he wanted to "empower" conservatives in Europe, right-wing media platform Breitbart News reported.
"I absolutely want to empower other conservatives throughout Europe, other leaders. I think there is a groundswell of conservative policies that are taking hold because of the failed policies of the left," Grenell told the conservative news site.
The ambassador added that "a lot of conservatives" in Europe had reached out to him about how they felt there was a "resurgence going on," Breitbart said.
VIDEO1:1501:15Government changes in EuropeSquawk Box
The comments from Grenell, a former spokesman for the U.S. at the United Nations during the Bush administration, have drawn some criticism over his apparent line-crossing when it comes to diplomatic norms.
"When I raised concerns to Grenell about politicizing this post, he personally assured me that once he became Ambassador he would stay out of politics. This interview is awful - Ambassadors aren't supposed to "empower" any political party overseas," Chris Murphy, a Democratic U.S. Senator for the state of Connecticut, said in a tweet.
Chris Murphy tweet: "When I raised concerns to Grenell about politicizing this post, he personally assured me that once he became Ambassador he would stay out of politics. This interview is awful - Ambassadors aren't supposed to "empower" any political party overseas."
The U.S. State Department and Germany's embassy in Washington, D.C., did not reply to emailed requests for comment sent outside of regular working hours.
Grenell's comments also came at a time when ties between the U.S. and Germany, as well as other members of the European Union, have become increasingly fraught. German Chancellor Angela Merkel, who former president Barack Obama once referred to as his "closest ally," has had a rocky relationship with U.S. President Donald Trump.
Some took the ambassador's comments as an affront to Merkel's government: She leads a center-right party that has been on the defensive against a growing far-right movement.
Tensions between the U.S. and the European Union have also run high, most recently after Trump's administration decided to apply tariffs on steel and aluminum imports on the European Union.
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f0a7cd5a9075c7574420411b0a3b1632 | https://www.cnbc.com/2018/06/04/apple-limits-safari-tracking-gives-more-control-over-personal-data.html | Apple's new privacy rules put Google and Facebook in a 'precarious place,' says ad industry exec | Apple's new privacy rules put Google and Facebook in a 'precarious place,' says ad industry exec
Craig Federighi, Senior Vice President Software Engineering speaks during Apple's annual world wide developer conference (WWDC) in San Jose, California, U.S. June 5, 2017.Stephen Lam | Reuters
Apple is introducing more controls to allow Safari users to control who gets their personal information online, including limiting data tracking across websites, the company announced on Monday at Apple's annual conference for software developers, WWDC.
The move helps Apple respond to increasing user concerns about privacy online, but could make it harder for websites and advertisers to target ads efficiently.
One advertising agency executive told CNBC Apple's new limits on tracking put Facebook and Google in a "precarious place" because it would block their ability to follow users across the web as well as attribute how many individual users were clicking on links or what kinds of people were looking at ads.
In addition to not having attribution info, the other big impact will the limits on the data ad providers get from multiple sources in order to target advertising, said Forrester vice president and principal analyst Thomas Husson. Apple's decision to introduce more privacy controls differentiates them from other tech companies like Facebook and Google and could make customers more loyal, he said.
"While in their interest, such an approach is perfectly aligned with Apple's DNA and business model," Husson said. "Apple is definitely ahead when it comes to using privacy as a competitive advantage."
One of the main updates asks users to opt-in to allow websites to track their browsing behavior on Safari, including sites with a "share" button or comments section provided by companies like Facebook or Google.
To demo the new feature, Federighi showed how Safari showed a pop up notice asking a user to allow Facebook to have access to cookie and website data before they were allowed to comment on a website. Though the website was not run by Facebook, its comments section allowed people to use Facebook Login to post their thoughts.
Users previously had to opt-out if they did not want to be tracked like this in most cases. In the past, ad providers could use cookies on websites to follow browsing history on any website they served advertising on. It was only 24 hours after a user visited a site that tracking was limited to the specific site they visited. With this update, third parties are automatically blocked.
"Now that it applies immediately, frequently visited sites — and not just Facebook — should be impacted," Forrester's Husson said.
Apple will also limit "fingerprinting," or the ability for companies to pinpoint precisely which device is visiting a website. That will make it "dramatically more difficult" for data companies to collect user information, Federighi explained, but could also make it harder for websites advertisers to measure how many people saw a particular piece of content.
Other protections include adding higher level protections against outside companies accessing information on a user's contacts, photos, calendars and reminders.
"There can be a lot of sensitive data on your devices, and we think you should be in control of who sees it," Apple's senior vice president of software engineering Craig Federighi said.
"We believe your private data should remain private," Federighi said.
The changes will have the most dramatic effect on mobile usage and tracking. Safari is the second most popular web browser with about a quarter of U.S. internet users using the browser on mobile and desktop according to the federal government's Digital Analytics Program. It is also the default web browser on Apple's massively popular iPhone. The company sold 52 million iPhones in the quarter ended March 31.
Apple found itself embroiled in privacy issues after a New York Times report alleged Facebook shared its user data with Apple and other device makers without explicit consent. Facebook made deals with these companies to allow them access to user account information and activities. In exchange, the device makers included its Messenger, "like" buttons and other Facebook features in their products.
While Facebook blocked developers from accessing friends' user information in 2015, it did not stop hardware companies from receiving the information. Facebook defended the decision, saying the contracts with device makers only gave limited use of user information for different versions "the Facebook experience" as opposed to third-party applications.
VIDEO0:5500:55Apple announces greater privacy protections in macOSTech
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d9e6c42120a26a54f49714c85b346bd1 | https://www.cnbc.com/2018/06/04/apple-shares-hit-record-on-first-day-of-developer-conference.html | Apple shares hit record on first day of developer conference | Apple shares hit record on first day of developer conference
VIDEO2:3602:36Developers are the linchpin for Apple, says expertPower Lunch
Apple shares hit a new all-time high on Monday, as tens of thousands of developers flooded into San Jose, California, for WWDC, the company's annual developer conference.
The stock rose as much as 1.7 percent to $193.42, pushing Apple's market capitalization past $940 billion. The shares have gained 24 percent over the past year.
All three of the world's most valuable publicly traded companies climbed to records on Monday, with Amazon and Microsoft also claiming new highs. The three tech companies are now worth a combined $2.5 trillion.
Apple's developer conference draws third-party programmers from across the world to hear the company discuss new tools and features, as well as introduce its new operating system. WWDC has become increasingly important, as the company works to assert itself as a software and services provider, rather than just a maker of iPhones and Macs.
Microsoft on Monday announced its acquisition of GitHub, which represents a big investment in courting developers.
Apple announced several features and upgrades, including a new operating system iOS 12, a new augmented reality toolkit in partnership with Adobe, and new features for combating tech addiction.
VIDEO7:0307:03Is making money in market as simple as just buying Apple?Fast Money
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cad43378bb55603ab63b5f199cddc64b | https://www.cnbc.com/2018/06/04/asco-the-worlds-largest-cancer-research-conference-5-takeaways.html | Five key takeaways from ASCO, the world's largest cancer research conference | Five key takeaways from ASCO, the world's largest cancer research conference
Merck & Co. Keytruda cancer treatment drug.Source: Merck & Co.
Every year in Chicago, tens of thousands of people with a stake in cancer research gather in the nation's largest convention center to learn about the latest developments in treating the disease.
The updates at the American Society of Clinical Oncology conference can be practice-changing for doctors, life-changing for patients, and — for investors — market-moving.
Many of the most stock-moving results were released over the weekend. Here are five takeaways.
"#ASCO18 is about lung cancer treatment," Hal Burstein of the Dana-Farber Cancer Institute, wrote on Twitter on Saturday.
Burstein tweet
And the winning drug for treating lung cancer, the leading cause of cancer-related deaths and the biggest market for cancer drugs, continues to be Merck's immunotherapy Keytruda.
In results presented over the weekend, Merck's drug was shown to be more effective as an initial treatment for patients with advanced nonsmall cell lung cancer, the most common form of the deadly disease, than chemotherapy.
A study in patients whose cancer expressed a biomarker known as PD-L1 showed that those treated first with Keytruda lived a median four to eight months longer than those on chemotherapy. What's more, they experienced fewer onerous side effects.
"I view this as a double win for patients," John Heymach, an ASCO expert with the MD Anderson Cancer Center, said in a media briefing Sunday. "Not only are patients living longer ... but they're also receiving a treatment that has substantially less toxicity."
Another Keytruda study, in squamous nonsmall cell lung cancer — which accounts for 25 to 30 percent of cases – "should establish the Keytruda/chemo combo as the new standard of care," Jefferies analyst Ian Hilliker said in a Sunday research note.
Merck's drug competes with others, such as by Bristol-Myers Squibb and Roche. Data on Roche's drug Tecentriq, used to treat advanced squamous nonsmall cell lung cancer, was also presented in a media briefing over the weekend. It showed that adding Tecentriq to chemotherapy reduced patients' risk of death, or their disease worsening, by 29 percent versus chemotherapy alone.
Bristol's chief scientific officer, Thomas Lynch, recently referred to the Merck and Bristol medicines as Coke and Pepsi: More similar than different when it comes to treating lung cancer.
After the results from this weekend? "All hail the king," wrote investor Brad Loncar on Twitter, referring to Merck.
VIDEO1:5601:56ASCO: Loxo Oncology shares up on cancer drug announcement Squawk Box
Young biotech Loxo Oncology was the belle of ASCO last year with data on its targeted medicine larotrectinib, which showed dramatic benefit for patients with rare cancers. That drug is now before the FDA for review.
This year, the company is back with the same strategy on another target, called RET fusions, which Loxo says are found in 2 percent of nonsmall cell lung cancer, and 10 to 20 percent of papillary and other thyroid cancers.
In a study of 82 patients, 77 percent of patients with RET-fusion cancers showed a response — meaning their tumors shrank — after taking Loxo's drug LOXO-292. In patients with RET-mutated medullary thyroid cancer, the response rate was 45 percent.
Six weeks ago, Loxo competitor Blueprint Medicines reported results for its drug BLU-667 on the same target. In nonsmall-cell lung cancer, the response rate was 50 percent; in medullary thyroid cancer, it was 40 percent.
Nick Leschly, CEO of Bluebird Bio in Cambridge.Wendy Maeda | The Boston Globe | Getty Images
Some of the first data most anticipated by Wall Street that emerged from ASCO were presented Friday evening on Celgene and Bluebird Bio's personalized immunotherapy for multiple myeloma. The treatment is a CAR-T — for chimeric antigen receptor T-cell therapy. It involves removing a patient's T-cells, genetically modifying them to identify a target on cancer cells (in this case, one called BCMA), and then giving them back to the patient.
Expectations were high running into the conference: Evercore ISI pegged them at an extension of patients' time without their cancer progressing (a measure known as PFS, for progression-free survival) of 12 to 15 months.
The data came in with a PFS of 11.8 months. Though some investors may be disappointed with the data, Bluebird CEO Nick Leschly expressed excitement, noting in an interview Saturday that patients in the trial had already tried a median of seven other therapies that had stopped working for them. Analysts were also supportive of the data.
"We think data looks quite good, especially in very sick population, and supports blockbuster potential for Celgene," Jefferies analyst Michael Yee wrote in a research note. Bluebird and Celgene are partners.
Nektar signed a $1.85 billion deal with Bristol in February to partner on its drug NKTR-214, which the companies hope will improve the efficacy of Bristol's immunotherapy drug Opdivo.
However, results of a study of those drugs in combination reported Saturday were confusing. That's because they include patients in different stages of the trial: For example, in melanoma, 11 of 13 patients in the first stage of the trial responded to the combination therapy. But in stage 2, which had a shorter follow-up time, just 14 of 28 did.
Investors will have questions about why response rates declined from stage 1 to stage 2, but Bristol-Myers' head of oncology development, Dr. Fouad Namouni, called the results "encouraging." The companies are now planning to move the combination into a larger, confirmatory trial with hopes the results will support regulatory approval.
This should spare a lot more folks from chemo that won't really have much benefit.Doug Schenkel.Cowen analyst
It's hard to find something these days that doesn't fall into the category of personalized medicine, with all of the aforementioned cancer drug trials characterizing patients based on what's driving their disease. But one of the major pieces of news out of the weekend applies a personalized medicine approach to an old therapy: chemotherapy for breast cancer.
For a type of breast cancer that accounts for half of all cases, it hasn't been clear whether certain women benefited from chemotherapy, in addition to hormone therapy, after surgery. A study funded by the National Cancer Institute as well as other groups found that chemotherapy in this setting benefits about 30 percent of women: Another 70 percent are likely to see the same outcome without chemotherapy.
"Practically speaking, this means that thousands of women will be able to avoid chemotherapy, with all of its side effects, while still achieving excellent long-term outcomes," ASCO expert Burstein said in a press release about the trial, which is dubbed TAILORx.
The results may be a boon for the maker of the diagnostic test used in the trial, Genomic Health, said Cowen analyst Doug Schenkel.
"It should drive an increase in use," Schenkel wrote in an email to CNBC. "There were lots of questions about the utility of the test in patients who had intermediate oncotype results. This should spare a lot more folks from chemo that won't really have much benefit."
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244b5c8cfe21de4b579b131047cc8ee9 | https://www.cnbc.com/2018/06/04/barclays-is-moving-forward-after-recent-challenges-ceo-jes-staley.html | Barclays is moving forward after recent 'challenges': CEO Jes Staley | Barclays is moving forward after recent 'challenges': CEO Jes Staley
VIDEO1:4201:42Barclays moving forward after recent 'challenges': CEO Jes StaleyClosing Bell
It certainly hasn't been an easy time for Barclays over the last year or so, but things are now looking up, CEO Jes Staley told CNBC on Monday.
During that time the bank grappled with legal issues, while Staley also found himself the subject of an investigation.
"The last year and a half has had its challenges," he said in an interview with Wilf Frost on "Closing Bell."
Barclays reduced its head count by 56,000, sold 22 businesses around the world and closed its retail banking business across Africa and continental Europe, Staley said.
On the legal front, Barclays was sued by the U.S. Department of Justice over its mortgage-backed securities business in 2006 and 2007 and was slapped with criminal charges by the British government for alleged unlawful financial assistance to Qatari investors.
In March, Barclays agreed to pay $2 billion to settle the U.S. suit but denied misleading investors about the quality of the mortgage loans backing the instruments and allegations it committed mail fraud and bank fraud.
Across the pond, a British court recently dismissed the charges in the 2008 capital-raising case.
Meanwhile, Staley was fined 642,430 pounds ($870,428) in May by British regulators for breaching conduct rules by attempting to identify who sent letters criticizing an employee of the bank.
The CEO said he felt that investigation was "fair" and "robust" and pointed out that Barclays is a "very complicated, challenging bank."
However, when asked if he ever feared that he may lose his job, he didn't directly respond.
"I feel that it was my obligation to commit my focus and attention to the Barclays shareholders, the Barclays customers and clients," he said.
However, he believes now it is time for the bank to move forward. "To a certain extent all of that is behind us and now we can look forward to running the bank and executing on our strategy," Staley said, pointing to the bank's "great" first quarter.
For one, the bank gained "significant" market share.
Plus, "our return on equity in the markets business was in double digits in the first quarter," he added. "So, not only did we gain market share, it was quite profitable for us."
Barclays reported a better-than-expected first-quarter pretax profit of 1.7 billion pounds ($2.4 billion) in April. However, fines and legal costs led to a statutory loss.
— Reuters contributed to this report.
VIDEO11:4111:41Barclays CEO: We've gained share in markets businessClosing Bell
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ea7c7878efa6767644c616afafba1431 | https://www.cnbc.com/2018/06/04/cnbc-exclusive-cnbc-transcript-mcdonalds-ceo-and-president-steve-easterbrook-sits-down-with-cnbcs-carl-quintanilla-today.html | CNBC Exclusive: CNBC Transcript: McDonald’s CEO and President Steve Easterbrook Sits Down with CNBC’s Carl Quintanilla Today | CNBC Exclusive: CNBC Transcript: McDonald’s CEO and President Steve Easterbrook Sits Down with CNBC’s Carl Quintanilla Today
WHEN: Today, Monday, June 4, 2018
WHERE: CNBC's "Squawk on the Street" – Live from McDonald's new Chicago headquarters
The following is the unofficial transcript of an EXCLUSIVE CNBC interview with McDonald's CEO and President Steve Easterbrook and CNBC's Carl Quintanilla on CNBC's "Squawk on the Street" (M-F 9AM - 11AM) today, Monday, June 4th. Following is a link to video from the interview on CNBC.com: https://www.cnbc.com/video/2018/06/04/mcdonalds-ceo-we-are-evolving-the-business-in-a-meaningful-way.html?play=1.
All references must be sourced to CNBC.
CARL QUINTANILLA: GOOD MORNING FROM CHICAGO, WHERE McDONALD'S IS OFFICIALLY OPENING A NEW CORPORATE HEADQUARTERS HERE, EVEN AS THEY'RE IN THE MIDST OF SOME BIG TRANSITIONS REGARDING THEIR MENU, REGARDING THEIR MARKETING, REGARDING STORE DESIGN, AND TECHNOLOGY. JOINING ME HERE AT THE CORPORATE HEADQUARTERS -- THE NEW CORPORATE HEADQUARTERS, STEVE EASTERBROOK IS THE CEO AND PRESIDENT OF McDONALD'S. IT'S GREAT TO SEE YOU, STEVE. GOOD MORNING.
STEVE EASTERBROOK: GREAT TO SEE YOU. GOOD MORNING.
QUINTANILLA: CONGRATULATIONS.
EASTERBROOK: WELL, THANK YOU. IT'S A FUN DAY. THANK YOU FOR MAKING THE TRIP. IT'S GOING TO BE A FUN DAY.
QUINTANILLA: YES. IT'S A BIG DAY. WHY IS THIS IMPORTANT TO THE COMPANY?
EASTERBROOK: WELL, I GUESS WE'VE TRIED TO EVOLVE THE BUSINESS IN A REALLY MEANINGFUL WAY THE LAST 2 OR 3 YEARS. AND I THOUGHT IT WAS REALLY IMPORTANT THAT FOR OUR PEOPLE THAT WE WERE POSITIONED OURSELVES IN AREAS WHERE OUR CUSTOMERS WERE, WHERE COMPETITION WAS, WHERE THE EMERGING TRENDS ARE COMING THROUGH IN SOCIETY. AND WE, YOU KNOW, WE HAVE A WONDERFUL RICH HERITAGE. AND WE WERE BASED OUT IN OAK BROOK, ON THE EDGE OF THE CITY FOR ABOUT THE LAST 40 SOMETHING YEARS. IT IT'S BEEN A WONDERFUL FACILITY FOR US BUT ACTUALLY IT WAS A LITTLE DETACHED FROM EVERYDAY LIFE. I THOUGHT IT WAS IMPORTANT THAT WE, MYSELF INCLUDED, WERE IN THE CUT AND THRUST. AND WE'RE IN THIS VIBRANT PART OF CHICAGO CALLED THE WEST LOOP AREA. WE COULD NOT BE BETTER PLACED TO BE COMPETITIVE IN THIS KIND OF MODERN, FAST-PACED WORLD.
QUINTANILLA: RIGHT. YOU LIKE TO SAY YOU WANT TO MAKE McDONALD'S A "MODERN, PROGRESSIVE BURGER COMPANY."
EASTERBROOK: RIGHT.
QUINTANILLA: AND THIS IS SORT OF A PIECE OF THAT.
EASTERBROOK: IT'S A PIECE OF IT. YEAH, ABSOLUTELY. I MEAN, IT'S CERTAINLY MUCH MORE THAN SYMBOLIC. 'CAUSE ACTUALLY, THIS IS SUCH AN ATTRACTIVE AREA OF THE CITY. AND IF YOU THINK ABOUT THE TRENDS THAT ARE GOING TO SHAPE OUR FUTURE, THE TALENT POOL IS GONNA HELP US WIN IN THOSE LITTLE BATTLES THAT GO ON IS LIKELY TO BE BASED DOWN THE CITY RATHER THAN BACK OUT IN THE SUBURBS. SO REALLY WE'RE TRYING TO POSITION OURSELVES FOR THE FUTURE. NOT JUST FOR TODAY BUT ACTUALLY FOR THE FUTURE. AND WE DON'T ALWAYS KNOW WHAT THOSE EMERGING TRENDS ARE GOING TO BE BUT I THINK THE TALENT POOL – THE YOUNGER TALENT POOL – IS LIKELY GOING TO BE MORE BASED AROUND HERE – IN THE CITY.
QUINTANILLA: SPEAKING OF THE FUTURE, YOU HAVE THIS INITIATIVE. I GUESS INTERNALLY AT LEAST YOU CALL IT "THE EXPERIENCE OF THE FUTURE."
EASTERBROOK: THAT'S RIGHT.
QUINTANILLA: WHICH WE HAVE SOME VIDEO OF.
EASTERBROOK: OKAY.
QUINTANILLA: PEOPLE'S EXPERIENCE AT McDONALD'S IS ABOUT TO CHANGE, IF IT HASN'T CHANGED ALREADY.
EASTERBROOK: YEAH. IT'S A DRAMATIC CHANGE. IF YOU THINK ABOUT IT – ONLY TWO YEARS AGO IF YOU'RE A CUSTOMER, THERE WERE TWO WAYS YOU CAN GET SERVED AT McDONALD'S. YOU WALK IN TO THE FRONT COUNTER AND YOU LINE UP AND THEN YOU TAKE YOUR TRAY AND YOU FIND YOUR DRINK AND YOU FIND A TABLE. OR YOU GO THROUGH THE DRIVE THROUGH. WHERE AS NOW WE'RE INTRODUCING SO MANY OTHER OPTIONS FOR OUR CUSTOMERS. YOU KNOW THEY CAN NOW CHOOSE WHETHER THEY GO TO THE SELF-ORDER KIOSK. THEY CAN ORDER THROUGH MOBILE ORDER AND PAY. THEY CAN EVEN COME CURBSIDE AND WE'LL RUN IT OUT TO YOU IN THE CAR, AS WELL AS THE EXISTING TRADITIONAL WAYS. SO – AND YOU CAN PAY IN DIFFERENT WAYS AND YOU CAN CUSTOMIZE YOUR FOOD IN DIFFERENT WAYS. SO I THINK WE'RE TRYING TO ADD MUCH MORE CHOICE AND VARIETY. AND ALSO MODERNIZE THE REAL ESTATE, AS WELL. PARTICULARLY HERE IN THE U.S. IT GOT A LITTLE BIT TIRED LOOKING. PART OF THIS IS ALSO JUST HAVING A MUCH FRESHER AND MODERN, INVITING, WARM, ENGAGING RESTAURANT.
QUINTANILLA: TALK ABOUT THE KIOSKS SPECIFICALLY --
EASTERBROOK: OKAY, YEAH.
QUINTANILLA: BECAUSE THERE'S ALL KINDS OF METRICS SURROUNDING IT, REGARDING WHAT IT DOES TO AVERAGE CHECK. RIGHT? WHAT DOES TO THROUGHPUT -- SPEED.
EASTERBROOK: IT WORKS ON A NUMBER OF DIFFERENT FUNCTIONS. YOU'RE ABSOLUTELY RIGHT. I MEAN, FIRST OF ALL, IF CUSTOMERS COME IN, THEY NOW HAVE A CHOICE. THEY CAN EITHER GO TO THE FRONT COUNTER AS THEY ALWAYS HAVE DONE. IF PEOPLE WANT TO JUST DWELL -- HAVE A LITTLE BIT MORE TIME, THEY CAN GO TO THE SELF-ORDER KIOSK, THEY CAN BROWSE THROUGH THE MENU, THEY CAN START SELECTING AND THEY CAN SEE THE BROADER RANGES, PERHAPS, OR THEY MAY WANT TO CUSTOMIZE THE FOOD THEY'VE GOT. THEN YOU CAN ALSO PAY CLEARLY ON CREDIT OR DEBIT THERE AS WELL, AND YOU CAN THEN RECEIVE TABLE SERVICE. SO YOU CAN THEN JUST TAKE A LITTLE TENT CARD – A BLUETOOTH ENABLED TENT CARD -- AND TAKE IT TO THE TABLE AND WE'LL BRING YOUR FOOD OUT FOR YOU. SO WHAT WE ARE FINDING IS WHEN PEOPLE DWELL MORE, THEY TEND TO SELECT MORE. SO THERE IS A LITTLE BIT OF AN AVERAGE CHECK BOOST AS WELL THAT COMES WITH IT.
QUINTANILLA: INTERESTING. AND THIS IS GOING TO BE IN ALL U.S. RESTAURANTS?
EASTERBOOK: YEAH SO WE'VE UNDERTAKEN A DRAMATIC PROGRAM HERE IN THE U.S. I MEAN, WE'RE SLIGHTLY MORE ADVANCED IN SOME OF OUR INTERNATIONAL MARKETS: UK, CANADA, AUSTRALIA, FULLY ROLLED OUT. FRANCE ALMOST. AND GERMANY IS AROUND HALFWAY. U.S. IS A LITTLE BIT BEHIND THAT SO WE'RE ACTUALLY GOING TO BE TRANSFORMING 1,000 RESTAURANTS PER QUARTER.
QUINTANILLA: LIKE 10 OR 11 A DAY.
EASTERBROOK: SO -- I MEAN, THE SCALE OF THIS PROJECT IS REMARKABLE. I MEAN, THE PROJECT MANAGEMENT THAT'S REQUIRED AROUND THIS IS IMMENSE. AND SO EXACTLY RIGHT. SO IT'S A THOUSAND PER QUARTER FOR THE NEXT EIGHT OR NINE QUARTERS, AND THAT WILL GET US PRETTY WELL CAUGHT UP IN THE U.S. BUT AS YOU SAY, TEN RESTAURANTS PER DAY ARE OPENING UP IN LOCAL COMMUNITIES, LOCAL COMMUNITIES ARE WAKING UP TO A DRAMATICALLY TRANSFORMED McDONALD'S.
QUINTANILLA: SO YOU MENTIONED YOU'RE A LITTLE BIT AHEAD OF THIS IN OTHER MARKETS, WHICH IS WHAT PEOPLE WERE LOOKING UP ON THE Q1 AND UPSIDE SURPRISE ON INTERNATIONAL Q1 COMPS, THINKING IS THIS WHAT THE U.S. IS IN FOR IF IT WORKS SIMILARLY?
EASTERBROOK: NO, EVERYONE IS TRYING TO READ ACROSS, AND I UNDERSTAND THAT. AND THAT'S WHAT GIVES US CONFIDENCE HERE IN THE U.S. I MEAN OUR LEADERSHIP TEAM, OUR OWNER/OPERATORS ARE SEEING THE SUCCESS OF THIS ELSEWHERE IN THE WORLD. I'M NOT GOING TO PROMISE ON THAT ABSOLUTE CARRIER ACROSS THE RESULTS. BUT WE DO KNOW THAT IT HELPS GROW THE BUSINESS. CUSTOMERS COME BACK MORE OFTEN THEY STAY A LITTLE LONGER AND THEY'RE JUST MORE ENGAGED WITH US AS A BUSINESS AND AS A BRAND. SO WE KNOW IT'S THE RIGHT ROUTE TO GO DOWN. AND THAT'S WHY WE'RE ACCELERATING SO HARD, BECAUSE WE CAN'T GET THERE QUICK ENOUGH IN THE U.S. IT'S EXCITING FOR US.
QUINTANILLA: I WANT TO GIVE JIM A MINUTE TO ASK QUESTIONS IN A SECOND. REALLY QUICK THOUGH, ON THE CONSUMER --
EASTERBROOK: RIGHT.
QUINTANILLA: HOW ARE THEY FEELING? YOU GOT 3.8% UNEMPLOYMENT. 17-YEAR LOW. YOU GOT GAS PRICES AND INTEREST RATES, AS WELL.
EASTERBROOK: YEAH, I THINK AS WE WERE ENTERING THE YEAR WE THOUGHT THERE WOULD BE AN UPTICK IN CONSUMER CONFIDENCE GENERALLY. FULLER EMPLOYMENT IS ALWAYS A GOOD THING. WAGE INFLATION IS BENEFITTING, YOU KNOW, PEOPLE'S POCKETS. AND, YOU KNOW, ALSO, PROBABLY THE TRICKLE THROUGH FROM TAX REFORM AS WELL, WE THOUGHT COULD ULTIMATELY HELP US AS WELL. I GUESS ON THE FLIP SIDE NOW WE'RE SEEING INTEREST RATES INCREASE A LITTLE BIT, AS WELL. AND GAS PRICES. YOU KNOW, WHEN THEY FILL UP THEIR CAR, IT JUST COSTS THEM A FEW MORE DOLLARS. SO I THINK AT THE MOMENT, I THINK, UNCERTAIN. THERE'S NOT A NEGATIVE FEEL BUT NOR ARE THEY BOISTEROUSLY OUT THERE – BOISTEROUSLY OUT THERE SPENDING EITHER.
QUINTANILLA: BUT DEFINITELY SHORT OF YOUR EXPECTATIONS GOING INTO THE YEAR?
EASTERBROOK: YEAH, I THOUGHT THERE'D BE A LITTLE BIT MORE OF A TAIL WIND. WE THOUGHT THERE WOULD BE LITTLE BIT MORE OF A BENEFIT IN THE BUSINESS. BUT, YOU KNOW, IT'S -- IT'D HAVE ONLY BEEN 1 OR 2% GROWTH ANYWAY. SO I MEAN, WE'LL JUST FOR THAT. WE'RE IN A MARKET SHARE FIGHT. AND WE'RE FIGHTING FOR CUSTOMERS AGGRESSIVELY.
QUINTANILLA: SPEAKING OF ALL OF THAT, JIM, I WANT TO GIVE YOU A CHANCE TO GET IN, TOO.
JIM CRAMER: YEAH, STEVE, I'M CONCERNED. YOU KNOW, I'M A McDONALD'S GUY THROUGH AND THROUGH, AS IS MY WIFE. BUT THIS WEEKEND WE SAID, "YOU KNOW, LET'S JUST TRY THE OTHER GUYS. LET'S GO TO SMASHBURGER." WE WAITED 15 MINUTES -- NOTHING. THEN WE SAID LET'S GO TO WENDY'S. WENT AND TRIED THE BACONATER. 15 MINUTES. IF YOU GIVE US ALL THIS CHOICE, STEVE, ARE WE GONNA HAVE TO WAIT THIS LONG? BECAUSE 15 MINUTES IS TOO LONG FOR FAST FOOD.
EASTERBROOK: OF COURSE I'TS TOO LONG, JIM. YEAH, I MEAN, PART OF WHAT WE'RE TRYING TO DO IS ACTUALLY PROVIDE MORE WAYS THAT CUSTOMERS CAN ORDER SO WE CAN ACTUALLY SERVE CUSTOMERS QUICKER. SO YEAH, IF YOU CAN SEPARATE IT -- INSTEAD OF HAVING TO LINE UP AT THE FRONT COUNTER AND EVERYONE CAN BE IN ONE LINE, YOU CAN GO TO THE SELF-ORDER KIOSK, FOR EXAMPLE, SELF YOURSELF AND WE'LL BRING IT OUT. AND THEN MEANWHILE WE CAN SAME TIME STILL SERVE THE FRONT COUNTER CUSTOMERS. SO, YOU KNOW, WE HAVE A – SOMETHING CALLED AN INNOVATION CENTER HERE WHERE WE MODEL ALL THE CHANGES WE DO, WE RUN OUR MENUS AND ALMOST LIKE A REAL TIME CUSTOMER APPROACH THROUGH IT TO MAKE SURE THAT WE DON'T END UP WITH THOSE LITTLE BOTTLE NECKS THAT FRUSTRATE CUSTOMERS.
CRAMER: OKAY. THAT'S IMPORTANT. NOW THE OTHER THING IS I WENT TO McDONALD'S TWO WEEKS AGO. STEVE – THERE'S ALL THESE PEOPLE – I DID DRIVE THROUGH. THERE'S ALWAYS PEOPLE WHO SAY, "I DON'T – WHAT'S A 3? WHAT'S A 2?" THEY DON'T KNOW HOW TO ORDER. I KNOW HOW TO ORDER. WHEN AM I GOING TO CUT IN FRONT OF THESE PEOPLE? I AM NOT GOING TO STAY BEHIND THESE PEOPLE WHO DON'T KNOW HOW TO ORDER!
EASTERBROOK: JIM, YOU NEED TO DOWNLOAD THE APP, PUT YOUR FAVORITES INTO IT, WE HAVE A GEOFENCE OF 300 FEET AROUND EVERY RESTAURANT. ONCE YOU BREAKTHROUGH THE GEOFENCE, IT WILL RECOGNIZE YOU, YOU SAY, "I'M READY TO ORDER," AND THEN THEY'LL SAY DO YOU WANT TO COME IN THE STORE TO SELECT, DO YOU WANT TO COME THROUGH THE DRIVE THROUGH, OR DO YOU WANT CURB SIDE PICK UP? SO, YOU TAKE CONTROL OF THAT, JIM. WE APPRECIATE YOUR BUSINESS. AND WE'RE READY TO SERVE YOU IN ANY WAY YOU WANT. AND YOU CAN SKIP THE LINE.
CRAMER: THIS IS WHY THIS STOCK GOES HIGHER THANK YOU. THANK YOU. THIS IS WHAT PEOPLE CARE ABOUT MORE THAN ANYTHING AND YOU KNOW THAT. THEY DON'T WANT TO WAIT AND IN THE DRIVE THROUGH THEY DON'T WANT TO BE DRIVE BEHIND PEOPLE WHO HONESTLY COULDN'T EVEN -- DON'T KNOW HOW TO SPEAK INTO A SPEAKER!
EASTERBROOK: JIM, IT'S A NUTS AND BOLTS BUISNESS. THIS IS A NUTS AND BOLTS BUSINESS. WE SERVE A LOT OF CUSTOMERS AND IT'S THE LITTLE DETAILS -- IT'S THE LITTLE ATTENTION TO DETAILS THAT REALLY MAKE THE DIFFERENCE. BECAUSE WHILST WE CAN GET EXCITED ABOUT OUR BIG PLANS, CUSTOMERS DON'T CARE ABOUT THAT. THEY JUST WANT TO GET THEIR FOOD HOT AND FRESH, FRIENDLY SERVICE, AND A FAIR VALUE. AND THAT'S WHAT WE'RE FOCUSSING ON.
QUINTANILLA: SO YOU'VE GOT CUSTOMER BEHAVIOR AND THE ENGINEERING, OBVIOUSLY, IS ONE THING --
EASTERBROOK: RIGHT.
QUINTANILLA: I'VE TO ASK YOU ABOUT TRADE, RIGHT? I MEAN, WE WERE SAYING ON "SQUAWK BOX" – THE PRIOR PROGRAM THIS MORNING - HOW AMERICAN THE ARCHES ARE, WHAT A POWERFUL SYMBOL IT IS AROUND THE GLOBE. YET YOU'VE GOT THE FRENCH FINANCE MINISTER SAYING THIS MEETING LAST WEEK WAS MORE LIKE G6 + 1 RATHER THAN A G7.
EASTERBROOK: NO I MEAN, I THINK THE GEOPOLITICAL SENSITIVITIES ARE HEIGHTENED ALL AROUND THE WORLD AT THE MOMENT. AND I MEAN, PART OF THE WAY WE STRUCTURE OURSELVES IS WE ALWAY HAVE LOCAL MANAGEMENT RUN THE LOCAL COUNTRIES. AND I THINK THAT HELPS JUST LOCALIZE US AS A BRAND. BECAUSE RATHER THAN JUST BEING SEEN AS A DOMINANT GLOBAL BEHEMOTH, WE WANT TO BE THE LOCAL McDONALD'S. WE WANT TO BE TO THE FRENCH McDONALD'S AND WE WANT TO BE THE CHINESE McDONALD' S OR THE U.S. McDONALD'S. SO IN TERMS OF TRADE OTHERWISE, IN TERMS OF TARIFFS AND SOME OF THE THINGS LIKE THAT, WE'RE NOT HUGELY EXPOSED TO IT BECAUSE LARGELY MOST OF OUR BASKET OF GOODS WE BUY IN COUNTRY. YOU KNOW, CERTAINLY OUR FOOD BASKET IS TYPICALLY LOCALLY SOURCED. CERTAIN ITEMS LIKE COFFEE BEANS AND HAPPY MEAL TOYS WE DO HAVE TO TRADE THOSE AROUND THE WORLD, SO YOU KNOW, WE'RE KEEPING AN EYE ON WHAT THAT MEANS IF THERE ARE TARIFFS. BUT AT THE MOMENT, WE DON'T FEEL SIGNIFICANTLY EXPOSED.
QUINTANILLA: YOU THINK FEARS ABOUT IT, THOUGH, ARE LIMITING THE STOCK, AT LEAST?
EASTERBROOK: I DON'T THINK SO. I THINK, I MEAN, WE'VE HAD NOW 11 QUARTERS OF GROWTH, TOP LINE GROWTH. AND THE MARKETS REACTED VERY GENEROUSLY TO US OVER THE LAST THREE YEARS. AND I THINK THE REALITY IS IF WE KEEP DRIVING THE GROWTH AND TAKING CARE OF THE COST SIDE OF THINGS AND, YOU KNOW, THERE WILL END UP BEING WINNERS AND LOSERS IN THE MARKET SHARE BATTLE. AND IF WE KEEP POSITIONS OURSELVES ON THE WINNING SIDE OF THAT, I THINK THE MARKET WILL REACT ACCORDINGLY.
QUINTANILLA: EVERY MORNING WE COME IN HERE, WE LOOK AT ITALY, SPAIN, ARGENTINA, TURKEY, RIGHT? -- BRAZIL. WHETHER IT'S 4X DISRUPTION OR POLITICAL DISRUPTION OR SUPPLY CHAIN DISRUPTION. DOES THAT IMPACT DEMAND? HAVE YOU FELT IT?
EASTERBROOK: YES. IN CERTAIN MARKETS, ABSOLUTELY YOU DO. I MEAN, INTERESTINGLY, WE'RE TRENDING WELL IN ITALY AT THE MOMENT BUT WE'VE GOT A GREAT MANAGEMENT TEAM IN THERE AND THE OWNER/OPERATORS ARE EXCITED AND THEY'RE INVESTIGATING IN EXPERIENCING THE FUTURE AND THAT'S REALLY HELPING A LOT. THINGS LIKE DELIVERY INITIATIVES HELP DRIVE GROWTH. THERE ARE CERTAIN ECONOMISTS AND CLEARLY WE'RE NOT IMMUNE FROM IT SO -- IT STRUCK ME A LITTLE BIT. AND WE'RE NOT AS STRONG AS WE WANT TO BE IN RUSSIA. WE'RE STRUGGLING A LITTLE BIT IN SOUTH KOREA AT THE MOMENT. SO THERE ARE LITTLE POCKETS WE KEEP AN EYE ON. BUT IT'S ACTUALLY THE MOST SIGNIFICANT MARKETS THAT MAKE UP THE MAJORITY OF OUR BUSINESS ARE PRETTY SOLID ECONOMIES AND PRETTY SOLID BUSINESSES THERE. SO, YOU KNOW, WE FEEL WE'RE SOMEWHAT SAFE GUARDED FROM THAT.
QUINTANILLA: HERE IN THE U.S., I WONDER IF FREIGHT OR OIL ARE STRESSING THE SUPPLY CHAIN, TOO.
EASTERBROOK: IT'S NOT A BIG DEAL FOR US. I MEAN, IT'S A LITTLE – OBVIOUSLY THERE'S A COST --. BUT BECAUSE WE HAVE SUCH HIGH VOLUMES, KIND OF THE FUEL COSTS IN TERMS OF PART OF OUR SUPPLY CHAIN IS MANAGEABLE, FOR SURE. AND, OF COURSE, YOU KNOW, WE'RE THE LONGEST ESTABLISHED SUPPLY CHAIN WE HAVE. WE CAN BUY FUTURES ON THIS STUFF AS WELL. SO AGAIN, SO YOU CAN HELP MANAGE THE COST FLUCTUATIONS. THE PIECE ABOUT FUEL THAT MATTERS MOST IS TO OUR CUSTOMERS. YOU KNOW, THAT'S WHY WE'RE SENSITIVE TO IT. BECAUSE IF THEY'VE GOT $5 OR $10 LESS IN THEIR POCKET, SOMETHING'S GOTTA GIVE. WE DON'T WANT IT TO BE A VISIT TO McDONALD'S OR THEY MAY JUST WANT TO TIGHTEN THE PURSE STRINGS A BIT.
QUINTANILLA: THIS MORNING AMERICAN AIRLINES WARNED OF FARE HIKES IF OIL PRICES STAY HIGH. IS THERE A NATIONAL AVERAGE AT WHICH YOU WOULD GET MORE CONCERNED?
EASTERBROOK: NO. NO, REALLY. IT REALLY DOESN'T INFLUENCE US. I MEAN, AGAIN, THE OTHER THING WE SEE SOMETIMES IS SOME OF OUR RESTAURANTS NEXT DOOR TO OIL STATIONS. YOU KNOW, SOMETIMES, YOU KNOW, IF FEWER PEOPLE ARE FILLING UP, WE CAN SOMETIMES SEE SOME OF THOSE DEMAND THERE EASE UP A LITTLE BIT. SO NO, WHEN WE KIND OF DOUBLE CLICK ON IT. IT ISN'T CARRYING THROUGH TO OUR BUSINESS IN ANY GREAT WAY, SHAPE, OR FORM.
QUINTANILLA: SOME OF YOUR COMPETITORS HAD DRAMATIC EPISODES OF LATE. STARBUCKS SHUTTING DOWN THEIR RESTAURANTS FOR A DAY FOR ANTI-BIAS TRAINING.
EASTERBROOK: YEAH.
QUINTANILLA: I MEAN, YOUR BATHROOM POLICY SORT OF FACED THE SAME QUESTIONS IN TERMS OF WHAT IS ABUSE OF THE THIRD PLACE. HOW DO YOU THINK ABOUT THAT?
EASTERBROOK: EVERY BUSINESS IS UNDER GREATER SCRUTINY THAN ANY TIME BEFORE AND, YOU KNOW, SOCIAL MEDIA ALLOWS THAT TO HAPPEN AND ALSO PUBLIC EXPECTATIONS OF HOW BIG COMPANIES BEHAVE ARE HEIGHTENED, AND THAT'S FAIR ENOUGH. I MEAN, FOR US – FIRST OF ALL, LET ME BE CLEAR, WE HAVE ABSOLUTELY NO TOLERANCE AT ALL OF ANY SORT OF HARASSMENT OR ANY SORT DISCRIMINATION RIGHT ACROSS McDONALD'S. BUT YOU KNOW, ONE OF THE BENEFITS WE DO HAVE IS OUR LOCAL MANAGERS, OUR LOCAL OWNER/OPERATORS, THEY KNOW HOW TO TAKE CARE OF THE CUSTOMERS. WE JUST WANT TO BE A WARM AND INVITING RESTAURANT. WE DON'T WANT ANYTHING MORE COMPLICATED. WE VALUE DIVERSITY AND INCLUSION. SO EVERYONE IS WELCOME AT McDONALD'S.
QUINTANILLA: NORTH KOREA, THERE HAVE BEEN SOME REPORTS THAT THEY WOULD LIKE A McDONALD'S. SHOULD THEY GET ONE?
EASTERBROOK: WELL, I'VE HEARD THE REPORT, AS WELL. BUT, I'VE GOT TO SAY, I MEAN, WE ARE IN 120 COUNTRIES. SO WE'RE IN THE MAJORITY OF THE COUNTRIES IN THE WORLD. AND, ACTUALLY, MOST RECENTLY WE OPENED IN KAZAKHSTAN. SO THAT WAS THE ONLY MARKET THAT OPENED DURING MY TENURE AS WELL. AND THAT WAS FUN. AND OPENING IN A NEW COUNTRY IS A LOT OF FUN. I'VE GOT TO SAY NORTH KOREA IS NOT PART OF OUR DISCUSSIONS RIGHT YET. BUT YOU NEVER SAY NEVER.
QUINTANILLA: PLASTIC STRAWS, REALLY QUICK, HAS BEEN A BIT OF AN ISSUE BECAUSE THERE WAS A SHAREHOLDER PROPOSAL THAT FAILED.
EASTERBROOK: THAT'S RIGHT.
QUINTANILLA: I THINK YOU RECOMMENDED AGAINST IT, BUT MEANWHILE MIAMI, SEATTLE, UK, MAYBE CALIFORNIA NOW.
EASTERBROOK: YEAH. I THINK, THE WHOLE TOPIC OF WHAT THEY CALL SINGLE-USE PLASTICS IS ON EVERYONE'S RADAR. AND THERE WAS A NATURAL HISTORY PROGRAM THAT ACTUALLY CAME OUT IN THE UK. THAT STARTED TO HIGHLIGHT THE ISSUE WITH PLASTICS IN THE OCEANS. AND IT REALLY CAPTURED PEOPLE'S ATTENTIONS. UNDERSTANDABLY. I MEAN, WE'VE MADE OUR COMMITMENTS ABOUT WASTE RECYCLING. EITHER TO REUSE OR TO RECYCLE. BUT THERE ISN'T CURRENTLY A VIABLE ALTERNATIVE THAT'S NONPLASTIC AT THE MOMENT.
QUINTANILLA: AT SCALE, YOU MEAN?
EASTERBROOK: AT SCALE. AT THE SCALE WE NEED. I WON'T BORE YOU WITH THE STATS BUT WHEN YOU HAVE 60 MILLION CUSTOMERS A DAY, YOU NEED A LOT OF STRAWS. SO BUT WE'RE WORKING AND WE WILL CONTINUING TO EXPLORE, BECAUSE WE'RE TRYING TO CONTRIBUTE BACK IN ANY WAY WE CAN TO SOCIETY, WHETHER IT'S THROUGH TRAINING OF OUR PEOPLE OR THROUGH ENVIRONMENTAL STANDARDS. WE'RE THE ONLY RESTAURANT BUSINESS THAT'S SIGNED UP TO THE PARIS CLIMATE ACCORD AROUND REDUCING GAS EMISSIONS. SO WHATEVER WE CAN DO AROUND WASTE AND RECYCLING IS A VISIBLE PART OF OUR BUSINESS. AND WE KNOW CUSTOMERS WOULD RESPOND WELL TO ANY SOLUTION WE CAN BRING.
QUINTANILLA: FINALLY, IS IT NICE TO HAVE A PRESIDENT WHO AT LEAST REPORTEDLY LOVES McDONALD'S?
EASTERBROOK: WE LOVE EVERY CUSTOMER. WE LOVE EVERY CUSTOMER. SO HE'S VERY WELCOME, AS WELL. I SENSE HE'S A REGULAR CUSTOMER, AS WELL. I HAVEN'T SEEN HIM IN THE RESTAURANTS BUT SEEMINGLY -- MAYBE HE'S HOME DELIVERY. MAYBE –
QUINTANILLA: HE HAS THE MOBILE APP.
EASTERBROOK: HE'S ON THE UBER EATS AT THE MOMENT.
QUINTANILLA: CONGRATULATIONS ON THE HEADQUARTERS. BIG UNVEILING TODAY.
EASTERBROOK: THANK YOU. YEAH.
QUINTANILLA: AND CUSTOMERS WILL BE LOOKING FOR THE CHANGES TO THEIR NEIGHBORHOOD RESTAURANT I IMAGINE IN THE FUTURE.
EASTERBROOK: RIGHT, YEAH. WELL, I THINK, FIRST OF ALL, HERE IS A LITTLE BIT OF FUN. I THINK YOU'VE HAD A CHANCE TO TASTE IT. WE THOUGHT WE WOULD DO SOMETHING DIFFERENT HERE BECAUSE THIS IS A ONE OF A KIND RESTAURANT. AND WE'RE ON A VERY FASHIONABLE STREET FOR RESTAURANTS SO WE WANTED TO DEMONSTRATE WE CAN HAVE A LITTLE TWIST, A LITTLE SENSE OF HUMOR, AND SOMETHING THAT WILL PIQUE PEOPLE'S INTEREST. SO WE'VE BROUGHT THE INTERNATIONAL MENU IN. I THINK YOU'VE HAD THE CHANCE TO TRY SOME OF THE SPICY CHICKEN – MY FAVORITE. THERE'S ALSO SALADS FROM FRANCE, DESERTS FROM LATIN AMERICA, WE'VE GOT LOADED FRIES, AND I'VE GOT TO TELL YOU, THEY'RE SELLING PRETTY WELL.
QUINTANILLA: I WOULD IMAGINE SO. STEVE, THANK YOU SO MUCH.
EASTERBROOK: ABSOLUTE PLEASURE. THANK YOU.
QUINTANILLA: GREAT SEEING YOU, STEVE EASTERBROOK –
EASTERBROOK: REALLY ENJOYED IT.
QUINTANILLA: McDONALD'S. GUYS, IF YOU'RE EVER IN CHICAGO, THE RESTAURANT HERE AT HEADQUARTERS, YOU CAN GET MENU ITEMS FROM ALL AROUND THE WORLD SO KEEP THAT IN MIND ON YOUR NEXT TRIP. BACK TO YOU.
For more information contact:
Jennifer Dauble CNBC t: 201.735.4721 m: 201.615.2787 e: jennifer.dauble@nbcuni.com
Emma Martin CNBC t: 201.735.4713 m: 551.275.6221 e: emma.martin@nbcuni.com
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3b14fd7f5ba900a60242477ab7940f91 | https://www.cnbc.com/2018/06/04/cramer-chipotle-del-taco-el-pollo-loco-charts-track-dining-comeback.html | VIDEO0:5500:55Chipotle, Del Taco and El Pollo Loco track fast-casual comebackMad Money with Jim Cramer
As restaurant stocks rise in lockstep with consumer sentiment and job growth, CNBC's Jim Cramer recruited technician Bob Lang to find the best investments in the dining space.
Lang, the founder of ExplosiveOptions.net and part of TheStreet.com's Trifecta Stocks newsletter team, found three fast-casual chains doing particularly well: Chipotle, Del Taco and El Pollo Loco.
"At a time when some people have been worried about rising raw costs and increased competition, ... these three companies have been putting on a pretty good show," Cramer said on Monday.
So, to explain why Lang thought all three stocks could outperform the broader restaurant sector in the near term, the "Mad Money" host turned to Lang's technical analysis.
The once-left-for-dead Chipotle has been making a serious comeback after two food safety incidents — an E.coli outbreak in 2015 and a norovirus outbreak in 2017 — crushed the stock.
When the market sold off in early February, Chipotle's shares finally managed to bottom in the $240s. Since then, the stock has been roaring, boosted by a strong quarterly report in April.
Lang pointed out that the stock's Relative Strength Index, a tool that tracks momentum, has been extremely positive since the company's April 25 earnings report.
He also noted some favorable volume trends: Chipotle's stock is no longer overbought, meaning that it could be ready for another run higher, and each recent rally has occurred on strong volume, meaning that the stock's latest moves higher have been "the real deal," Cramer said.
"In the end, Chipotle is Lang's favorite stock in the group here, and he thinks that this $443 stock can rally to $480 and then perhaps even [to] $500 in the not-too-distant future," Cramer said.
Like Chipotle, shares of Del Taco, a small-cap, more speculative Mexican food chain, have recovered handsomely since their March lows, gaining nearly 25 percent.
Lang liked the strength he saw in this chart's Relative Strength Index. More importantly, he liked that Del Taco's moving average convergence-divergence indicator, which predicts changes in a stock's trajectory before they happen, made a bullish crossover in April.
The crossover, depicted by the black line in the chart above crossing over the red one, sent shares of the 300-restaurant eatery even higher.
"But Lang believes that Del Taco could have even more upside," Cramer said. "While the stock is approaching the ceiling of resistance from where it gapped down in March — at $12.50, right near the 200-day moving average — Lang believes it can make a run at that level and then push higher."
"As he sees it, the path of least resistance takes Del Taco to just under $14. That's roughly 13 percent from these levels," the "Mad Money" host added. "I like that call."
For fellow small-cap Mexican chain El Pollo Loco, Lang used the stock's weekly chart. Shares of El Pollo Loco recently made a run at their 50-week moving average, met their ceiling of resistance, then abated. But according to Lang, there was more to that move than met the eye.
"Based on the action here, Lang thinks this could be a wildcard for upside," Cramer said. "Why? Well, El Pollo Loco recently made a higher low — that's a good sign — and the volume trends have been improving, ... meaning the volume is higher on up days than down days."
"Meanwhile, the Relative Strength Index, RSI, keeps climbing, and in April, the moving average convergence-divergence indicator made that bullish crossover," he continued.
All in all, Lang thought that by the end of this year, El Pollo Loco's stock could push above its ceiling of resistance and rally to its 2017 highs of around $15.
Despite Chipotle's share-shattering scandals and Del Taco and El Pollo Loco's comparatively speculative situations, Cramer and Lang agreed that this dining sub-cohort's bounce was worth watching.
"After spending a long time in the wilderness, these Mexican restaurant chains have been making some remarkable comebacks here," the "Mad Money" host concluded. "The charts, as interpreted by Bob Lang, suggest that Chipotle, Del Taco and El Pollo Loco still have plenty of upside here and I think he's got a strong case. That said, Chipotle is the only one of these three that's not extremely speculative, so please be extra careful with the other two."
VIDEO10:1310:13Cramer's charts of Chipotle, Del Taco and El Pollo Loco track the fast-casual dining comebackMad Money with Jim Cramer
Questions for Cramer? Call Cramer: 1-800-743-CNBCWant to take a deep dive into Cramer's world? Hit him up! Mad Money Twitter - Jim Cramer Twitter - Facebook - Instagram - VineQuestions, comments, suggestions for the "Mad Money" website? madcap@cnbc.com
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0f05c4ed3cec8bbe45b208f397afa44f | https://www.cnbc.com/2018/06/04/cramer-its-not-just-fang-other-tech-stocks-drove-nasdaq-to-new-highs.html | VIDEO1:5501:55The tech stocks that pushed the Nasdaq to new highsMad Money with Jim Cramer
CNBC's Jim Cramer knows all too well that the market can't be driven solely by FANG, his ubiquitous acronym for the stocks of Facebook, Amazon, Netflix and Google, now Alphabet.
"On a great day for the bulls where the Dow gained 178 points, the advanced 0.45 percent, and the Nasdaq climbed 0.69 percent to a new all-time high, I think we need a new acronym for tech," the "Mad Money" host said Monday. "FANG's just not cutting it anymore because the gains are no longer limited to [that cohort]."
"If you want to understand the strength in the Nasdaq, you need a new acronym," Cramer continued. "So say hello to INJFANG, as in 'It's Not Just FANG' anymore."
First, Cramer turned to Apple, one of his favorite consumer products companies. Shares of the iPhone maker hit record highs on Monday as its annual developer conference kicked off.
Apple has long been the target of critics on Wall Street who worried about declining hype around the newest iPhones, supply chain issues and the like.
"But what these critics were missing is that Apple doesn't just have the most loved, best tech for its cellphones, it's got a razor-razorblade business model that can't be beaten," Cramer said. "That means people buy the phone and pay for services directly from Apple or buy some of the developer apps on display today at the big conference and Apple gets a cut of each one."
With a growing revenue stream and a massive cloud backup service that customers don't seem to mind paying for, Apple was a key factor in Monday's rally, Cramer argued.
"Apple's strength — the stock hit its all-time high again today — is exhibit A in the non-FANG romp," he said. "It's kind of amazing that a company with a $943 billion market cap could really rally this hard."
Cramer took note of investors' changing sentiments about the semiconductor space as shares of Nvidia, which makes chips for the data center, artificial intelligence, driverless car, machine learning and video game industries, reached an all-time high.
Chipmakers' stocks had been under pressure since tensions with Chinese regulators stalled acquisition talks between Qualcomm and NXP Semiconductors.
"It took a little bit, but ultimately, the market was able to draw a distinction between chip companies that are pure cellphone plays and the ones that aren't," Cramer explained. "[Nvidia's] last quarter was spectacular, even if the sourpusses on Wall Street sold it off because the irrelevant cryptocurrency biz was soft. Sure didn't take long for the stock to bounce back."
Shares of Microsoft also helped take the Nasdaq to new highs after the company announced it would acquire GitHub, a code-building and management platform for software developers.
Microsoft's stock reached a 52-week high on Monday, settling at $101.67 per share. Cramer applauded the company's broad-based strength in personal computers, gaming and the cloud, commending CEO Satya Nadella for his savvy dealmaking.
"Microsoft has run, but I don't get the sense that it's overheating," the "Mad Money" host said. "We have an absence of news right now and absence is making the heart grow fonder for the stock."
Cramer reiterated that Monday's widespread strength in the stock market wouldn't have happened without FANG. The tech giant's stocks still helped; it's just that others reclaimed the spotlight.
"Here's the bottom line: the Nasdaq was left for dead not that long ago, but turns out it was just resting," he concluded. "Will it continue to roar? I think investors like these stocks the same way Willie Sutton liked to rob banks: because that's where the money is."
VIDEO12:2112:21Cramer: It's not just FANG—here are the other tech stocks that pushed the Nasdaq to new highsMad Money with Jim Cramer
Disclosure: Cramer's charitable trust owns shares of Facebook, Amazon, Alphabet, Apple, Nvidia and Microsoft.
Questions for Cramer? Call Cramer: 1-800-743-CNBCWant to take a deep dive into Cramer's world? Hit him up! Mad Money Twitter - Jim Cramer Twitter - Facebook - Instagram - VineQuestions, comments, suggestions for the "Mad Money" website? madcap@cnbc.com
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f81b6e357ed3b95fab889f43b190212f | https://www.cnbc.com/2018/06/04/cramer-reflects-on-italy-panic-a-little-context-goes-a-long-way.html | VIDEO1:2301:23Cramer on Italy panicMad Money with Jim Cramer
A week ago, CNBC's Jim Cramer was trying to placate investors' fears about a political crisis in Italy, which sent global markets reeling and resulted in the appointment of a new prime minister.
A spike in Italian bond yields sparked the concerns. But now, one week later, they've recovered to their pre-crisis levels, making Cramer wonder why investors were so spooked in the first place.
"Some investors hate anything that threatens the status quo, even in a place like Italy where the status quo is objectively kind of terrible," the "Mad Money" host explained on Monday.
Others, he said, are so skittish that they balk at any and all uncertainty, even if it doesn't apply to the United States, "because they are trained to react to any new input with fear."
Still, what concerned Cramer most about the Italy debacle was not how investors reacted to the news, but the lack of context with which it was reported.
"It's very easy to gin up fear-inducing headlines when two supposedly extremist parties form a coalition to take power, but, man, it's hard to see how they could do a worse job than the guys they were replacing," he said. "Why doesn't anybody say that?"
He offered some perspective: Italy has very little growth, 11 percent unemployment and a budget that is unraveling due to pressures from a growing refugee population.
Moreover, Cramer argued that many of Europe's recent, seemingly chaotic movements have actually created investment opportunities because of how short-lived they've been.
"Now, obviously the press can't [avoid] a story like this," he said. "But you can give people some context, and when it comes to Italy, a little context could've gone a long way."
This idea brought Cramer back to one of his biggest long-term concerns: that market experts frequently fuel investors' fears without facing the consequences of being wrong.
"That is the way this business works: bulls are always punished more harshly for being wrong than the bears are," he said. "But you can expect it and you can exploit it the next time we get some huge sell-off on a story that has nothing to do with the United States, just like this Italian job."
VIDEO4:5604:56Cramer reflects on Italy panic: 'A little context goes a long way'Mad Money with Jim Cramer
Questions for Cramer? Call Cramer: 1-800-743-CNBCWant to take a deep dive into Cramer's world? Hit him up! Mad Money Twitter - Jim Cramer Twitter - Facebook - Instagram - VineQuestions, comments, suggestions for the "Mad Money" website? madcap@cnbc.com
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ee141cd7b8a927f17fd3967486cb8b1d | https://www.cnbc.com/2018/06/04/howard-schultz-architect-of-modern-starbucks-to-step-down-as-executive-chair-and-from-the-board.html | Howard Schultz, architect of modern Starbucks, to step down as executive chairman | Howard Schultz, architect of modern Starbucks, to step down as executive chairman
VIDEO7:3107:31Howard Schultz stepping down as SBUX executive chairmanClosing Bell
Howard Schultz is stepping down from his role as executive chairman of Starbucks, effective June 26, according to a memo sent to employees Monday. Schultz is seen as the architect of the modern Starbucks, having overseen its expansion from a single coffee shop that opened in Seattle's Pike Place Market in 1971. He joined Starbucks in 1982 as director of operations and marketing. Over time he grew it into the iconic brand it is today, with more than 28,000 locations globally. Schultz's latest leadership transition sparked speculation about his potential political plans: He has been a supporter of former President Barack Obama and Hillary Clinton during her bid for president. Some have already questioned whether he would pursue his own presidential run.
"I'll be thinking about a range of options for myself, from philanthropy to public service, but I'm a long way from knowing what the future holds," Schultz said in the memo. Myron E. Ullman, former chairman and CEO of J.C. Penney, was named chair, while Mellody Hobson, president and director of Chicago-based investment management firm Ariel Investments, will be named vice chair. Schultz, who now will become its chairman emeritus, served as the company's chief executive from 1987 to 2000, stepping down to focus on the company's global strategy. He remained on as chairman of the board. At that time, there were only 350 cafes located outside of the U.S. From 2000 to 2008, Starbucks rapidly expanded from 3,500 to about 16,000 locations, but for Schultz, the quality of the brand and its coffee had deteriorated. He returned to the head position in 2008 to revitalize it. Again in 2017, Schultz stepped down, handing the keys over to current CEO Kevin Johnson. Once more, he picked up the mantle of executive chairman of the brand, this time focusing on Starbucks' Roastery and Reserve Bar expansion. "I set out to build a company that my father, a blue-collar worker and World War II veteran, never had a chance to work for. Together we've done that, and so much more, by balancing profitability and social conscience, compassion and rigor, and love and responsibility," he said.
Schultz laid the groundwork for Starbucks' extensive employee benefits including, health care, stock ownership and free college tuition. As CEO, Schultz also lead global hiring initiatives for veterans and military spouses as well as refugees.
He is currently writing a book about his social work and his efforts "to redefine the role and responsibility of a public company in an ever-changing society."
"Howard Schultz has been a pioneer in setting and maintaining a culture of social responsibility — both environmentally and socially — while being able to maintain financial performance," Tim Hubbard, assistant professor of management at the University of Notre Dame's Mendoza College of Business, told CNBC via email. "He has served as an example to other executives who work towards socially responsible firms, and as an example to board members who frequently cite his behavior as models for executives."
VIDEO7:2007:20Schultz not a standard part of corporate America: SonnenfeldClosing Bell
Under Schultz's leadership, the company's stock has grown 21,000 percent since its initial public offering in 1992. He currently owns 37.8 million shares of Starbucks, or a 3 percent stake, worth about $2.17 billion.
Schultz's leaves at time when the company is struggling to revitalize same-store sales in the U.S., a trend that has contributed to a nearly 12 percent decline in its stock over the past year. Shares of the company were down nearly 1 percent in after hours trading on Monday.
The coffee chain's image also took a hit recently after two black men were arrested in one of its cafes in Philadelphia after asking to use the restroom. The company responded swiftly, and closed last week to provide anti-bias training to 175,000 employees.
Schultz has always been a big proponent of Starbucks as a "third place," a space for the community to gather.
"We will learn from our mistakes and reaffirm our commitment to creating a safe and welcoming environment for every customer," Schultz said after the incident.
—CNBC's Andrew Ross Sorkin contributed to this report.
Watch CNBC's exclusive interview with Starbucks' Howard Schultz on Tuesday at 8 a.m. ET.
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56241adb3a816e227ccaa51cda133eaf | https://www.cnbc.com/2018/06/04/howard-schultz-became-a-player-in-politics-while-he-was-at-starbucks.html | Howard Schultz established himself as a player in politics before he decided to leave Starbucks | Howard Schultz established himself as a player in politics before he decided to leave Starbucks
VIDEO1:2901:29Starbucks' Howard Schultz gets politicalSquawk Box
In the years before he confirmed his plans to leave Starbucks on Monday, Howard Schultz took an active role in politics through both his words and money.
Schultz has previously denied speculation that he could run for president. Still, he indicated Monday that he will leave the door open to a career in politics once he exits his role as the coffee chain's executive chairman later this month.
"I want to be truthful with you without creating more speculative headlines. For some time now, I have been deeply concerned about our country — the growing division at home and our standing in the world. One of the things I want to do in my next chapter is to figure out if there is a role I can play in giving back. I'm not exactly sure what that means yet," he told Andrew Ross Sorkin of CNBC and The New York Times on Monday.
He told employees that he will think about "a range of options" from "philanthropy to public service."
VIDEO11:1211:12Starbucks sinking after Executive Chairman Howard Schultz steps downFast Money
Schultz recently established himself as a player in the political world — in no small part thanks to his outspoken criticism of President Donald Trump. In his public comments and contributions, Schultz has portrayed a left-of-center political ideology.
In January 2017, he announced that Starbucks would hire 10,000 refugees over five years, only two days after Trump issued an executive order barring refugees from several Muslim-majority countries. In comments to employees the following month, Schultz said Trump created "chaos" that hurt the U.S. economy.
Last year, he criticized the Republican tax plan before Congress passed it in December.
"This is a tax cut. This is fool's gold. [Trump] wants to take the corporate tax rate from 35 to 20 percent for what purpose? Is that profit going to go back to the people who need it the most? Is that going to help small businesses? Is that going to help half the country that doesn't have $400 in their bank account for a crisis? No," he said at the DealBook Conference in November.
Schultz vocally supported Hillary Clinton for president in 2016, giving $10,800 to her joint fundraising committee with the Democratic Party. That year, he gave $1,250 to the campaign of Sen. Maria Cantwell, D-Wash., and $5,000 to VoteVets, which works to elect progressive politicians.
His contributions have not just gone to Democrats, though. This year, he contributed $50,000 to With Honor Fund, a cross-partisan organization that works to elect veterans.
VIDEO7:2007:20Schultz not a standard part of corporate America: SonnenfeldClosing Bell
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a18364568b54fe2fe39f9f5598ec9907 | https://www.cnbc.com/2018/06/04/loews-hotels-ceo-jonathan-tisch-on-trump-extreme-vetting-of-visitors.html | Loews Hotels CEO: We're 'losing market share' due to Trump's extreme vetting of foreign visitors | Loews Hotels CEO: We're 'losing market share' due to Trump's extreme vetting of foreign visitors
VIDEO3:1003:10Loews Hotels CEO: Visitors want to feel welcomed in the USSquawk Box
Loews Hotels CEO Jonathan Tisch said Monday that the U.S. hotel industry is "losing market share" due in part to the Trump administration's so-called extreme vetting of foreign visitors.
"Our concern as an industry is related to inbound international travelers," Tisch said on CNBC's "Squawk Box." He's also a co-owner of the New York Giants.
"Visitors want to feel welcome, they want to feel safe," he said. "Even though business is pretty good ... the number of inbound international travelers in the U.S. is losing market share."
"That's due to a variety of reasons," including the president's policies and rhetoric concerning background checks on people who want to come to America.
President Donald Trump has repeatedly said "extreme vetting" of foreigners entering the U.S., a frequent promise since the campaign, is needed to prevent terrorism.
Tisch said the U.S. certainly needs border security, but also "open doors."
The president last year proposed to eliminate Brand USA, a federally funded organization that promotes the U.S. overseas as a tourist destination.
Ending Brand USA would be a "mistake," said Tisch, whose business has 24 hotels with six others under development. The program offers strong returns and doesn't cost American taxpayers "one single dollar," he added.
Tisch, co-chairman of the hotel group's parent, Loews, urged those in the industry to work with elected officials about "putting out a welcoming message" because inbound travelers "stay longer [and] spend more money."
Tisch wrote an op-ed published published Monday, which dealt with the slowdown of international visitors and subsequent U.S. economic impact.The White House did not immediately respond to a request for comment.
— Disclosure: Lowes Hotels is working on additional property partnerships with NBCUniversal, which along with CNBC is owned by Comcast.
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04219e0d35e283b146c251c4e0108cdb | https://www.cnbc.com/2018/06/04/microsoft-ceo-satya-nadella-on-github-we-are-all-in-on-open-source.html | Microsoft CEO Satya Nadella says $7.5 billion GitHub deal shows, 'We are all in on open source' | Microsoft CEO Satya Nadella says $7.5 billion GitHub deal shows, 'We are all in on open source'
VIDEO4:2504:25Microsoft CEO: We welcome every cloud providerSquawk Alley
Microsoft CEO Satya Nadella says the company's $7.5 billion purchase of software developer platform GitHub shows, "We are all in on open source."
"Microsoft has heritage here. We were a developer tools company first and now, of course, we are all in on open source, and that's what really brings us together with GitHub," Nadella told CNBC's "Squawk Alley" on Monday. "We're going to operate it as an open platform for any language, any framework, any platform."
GitHub was valued at $2 billion in its last funding round in 2015, though it has yet to turn a profit.
Microsoft is in the midst of a cloud-first reorganization, which has sent the software giant in search of alternatives to court developers.
"[The] most important thing with a community asset like GitHub is to stay true to the core ethos of developer-first that GitHub has always had," Nadella said.
GitHub's tools have become essential to software developers, who use it to store code, keep track of updates and discuss issues. Nadella said that the "core ethos" of GitHub going forward will remain the same and that Microsoft will run it independently.
Microsoft Vice President Nat Friedman will assume the role of GitHub CEO, Microsoft said. He takes over for the developer platform's founder, Chris Wanstrath, who stepped down 10 months ago.
Andreessen Horowitz invested $100 million in GitHub six years ago. General partner Peter Levine championed Microsoft's pick to run the platform, noting that Friedman's reputation as a software developer demonstrates Microsoft's commitment to maintaining GitHub's open-source spirit.
"Nat Friedman will be a tremendous steward of this business. He is a developer-oriented person first," Levine told CNBC in an interview. "There are 800 GitHub people who have done a great job getting the company to this point. The Microsoft team will certainly be able to capitalize on that momentum."
It's an important choice, he said, considering GitHub's standing in the programming world.
"The develop ecosystem in an organization is front and center as every company in the world turns into a software company. GitHub catalyzed this," Levine said.
Microsoft has already integrated its Azure cloud services with GitHub, Nadella said, and will continue to integrate those services. He encouraged other cloud providers to integrate with open-source platforms, as well.
Microsoft, under Nadella, has embraced longtime rival technology Linux, the open-source software that ex-CEO Steve Ballmer once described as a "cancer."
— CNBC's Ari Levy and Alex Sherman contributed to this report.
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d0b1e1a5c4693101289b04cd571fa3d9 | https://www.cnbc.com/2018/06/04/tesla-shareholders-prepare-to-vote-using-new-say-app.html | Tesla shareholders to swipe right or left on whether to split Elon Musk's job | Tesla shareholders to swipe right or left on whether to split Elon Musk's job
Elon MuskGetty Images
Tesla shareholders are gearing up to swipe left or right, depending on whether they want Elon Musk to keep both his titles as chairman and chief executive.
A New York start-up aiming to make voting easier for regular shareholders who don't know the nitty-gritty details of proxy ballots and shareholder meetings is using the Tesla vote as its debut moment.
People who want to voice their opinions for or against an independent chairman at Tesla can sign up for the digital site, called Say. They will be able to connect it to their brokerage account to verify they own Tesla shares, and then click one of two buttons, one for keeping Musk in that role and one against. It is a mobile app and a website.
Ultimately, the app is aiming to make it easier for regular investors to take advantage of their ownership rights and make their votes count, Say's co-founder and CEO Jeffrey Cruttenden told CNBC. He got the idea through his other start-up, a micro-investing robo advisor called Acorns.
For Tesla's meeting, the Say "vote" is really a poll. Actual ballots cast for the Tesla proxy had to come from shareholders of record as of April 12 and voted through a broker. Say is working on connecting to brokers so it can handle shareholder verification and voting at some point in the future.
Technology has made trading and investing easy, but the voting part of it for a long time "has not been exactly customer-friendly," Cruttenden said.
"The proxy voting experience was so terrible that we really wanted to make sure that we could improve it," he said on CNBC's "Squawk Box" on Monday.
It's an open question how motivated Tesla's shareholders will be to vote for change. While big fund companies and professional investors have high rates of voting participation, only 27 percent of retail investors vote, according to a report by Broadridge Financial and PwC.
And voting tends to go along with management recommendations. Last year, 93 percent of votes were cast in support of director nominees and 84 percent in support of executive pay, the report said.
Tesla is nearly half-owned by big fund companies, and Musk holds another nearly 20 percent stake, according to FactSet.
Cruttenden said generally, turnout is low for electronic proxy voting, about 5 percent, as well as paper ballots, about 30 percent. And it skews to older, wealthier shareholders. Younger or newer investors don't necessarily know they can vote, he said.
Tesla shareholders vote for an independent chairman at the electric automaker's annual meeting Tuesday. Musk has been chairman since 2004 and CEO since 2008.
A shareholder proposal pushing the idea of an independent chairman has the support of proxy voting advisors Glass Lewis and Institutional Shareholder Services, though the company is urging people to vote against it.
The shareholder contends that the job has gotten too complex for one person. Musk has been scrambling to get Tesla's Model 3 production on track against scrutiny of the company's manufacturing abilities. He also has a variety of other projects, including space transport, solar power and high-speed tunnel travel.
"The complexity of large-scale manufacturing and the challenges of successfully commercializing new technologies and new manufacturing and marketing techniques suggest that shareholders would be better served by having Musk focus on running the company, and allowing an independent director to run the board," ISS said in a report last month.
It is usually difficult for shareholders to win campaigns, though big labor unions representing pensions and faith-based groups have raised issues from corporate governance to environmental and social issues for years with mixed results.
Activists led by a religious group recently won a surprise vote at gunmaker Sturm Ruger, requiring it to prepare a report on the risks associated with its business.
The shareholder pushing the vote at Tesla isn't a major activist with a big following, either. Instead, Jing Zhao, a California resident with just 12 shares of Tesla, says he filed the proposal to bring the issue to the attention of the board and will be content that shareholders got to consider it, whether or not it passes.
"Even if this does not get the majority, it puts pressure on the board," Zhao told CNBC in a phone interview. "I don't believe even a superhuman can do so many things."
Say is backed with $8 million in first-round funding from Steve Cohen's Point72 Ventures and other investors.
Eventually, the app can be used to vote on issues at other companies, but Cruttenden says he picked Tesla's meeting because it was a prominent stock and a big enough issue to draw attention, regardless of the outcome of the vote itself. "When owners get together, that's very powerful," he said.
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79f0bd233a71c8e401763e7db2b2746a | https://www.cnbc.com/2018/06/04/the-aviation-industry-is-in-a-pretty-good-place-boeing-exec-says.html | The aviation industry is in 'a pretty good place,' Boeing exec says | The aviation industry is in 'a pretty good place,' Boeing exec says
VIDEO3:1803:18'We're in a pretty good place right now,' says Boeing execSquawk Box Asia
Over the past eight and a half years, the growth of the aviation industry has been "very strong," according to one Boeing executive.
"(The) market's in a pretty good place," said Randy Tinseth, vice president of marketing at Boeing Commercial Airplanes.
Speaking with CNBC's Matthew Taylor, Tinseth said passenger traffic numbers have grown above trends and the demand in cargo markets has come back in recent years, resulting in airlines being "at or near record profitability."
"From a Boeing perspective, our (production) rates are 65 percent in that eight year period. Last year, we had record deliveries and this year we're on track to even deliver more aircraft," Tinseth said.
Boeing's performance comes amid changing customer demands in the industry, with more airlines shifting toward direct service flights instead of traveling through a hub.
One example of a plane that enables such a service is Boeing's own 787 Dreamliner, which Tinseth said has opened up 180 new markets since going into service in 2011.
"It's about the right-sized airplane, really efficient aircraft, great economics to open up these routes more profitably," he said.
As trade talks between the U.S. and China remain inconclusive, Boeing has been one of the companies under the spotlight for being a potential retaliation target caught in the crossfire.
"There's no question, this is a global industry," Tinseth said. "In fact, 80 percent of the aircraft we build, deliver outside of the United States."
"We're big proponents and always have been for fair and open trade," he added, explaining that open markets and greater deregulation translate into better prices for customers.
Voicing his opinion that the growth of the world economy and the aviation industry were symbiotic in nature, Tinseth said Boeing is watching the market "very closely."
"We recognize the importance of trade and economic growth and we're hoping, as we go through this, that the governments will understand that as well," he said.
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3f84cc76ab20ff58b7954b2c31b2553b | https://www.cnbc.com/2018/06/04/top-white-house-tax-advisor-to-leave-for-bank-lobbying-group.html | Top White House tax advisor to leave for bank lobbying group | Top White House tax advisor to leave for bank lobbying group
White House tax policy guru Shahira Knight is leaving the Trump administration for bank lobbying group Clearing House Association.
"While it has been an honor to serve on the White House National Economic Council, I am excited for the opportunity to help launch a new organization that will advance thoughtful policies for an industry so critical to the growth of our economy," she said in a statement.
Knight will become executive vice president and head of public affairs for the Washington-based firm. She currently serves as deputy assistant to President Donald Trump for economic policy and deputy director of the National Economic Council.
Clearing House President Greg Baer called Knight a "brilliant legislative strategist" who possesses "considerable knowledge of financial services issues."
The group is merging with the Financial Services Roundtable. Brian Moynihan, Bank of America CEO and chairman of the Financial Services Roundtable said Knight "brings her record of leadership in creating pro-growth economic policies to our organization."
Before joining the Trump administration, Knight was vice president of the public affairs and policy group at Fidelity Investments. She also served as senior advisor to the chairman of the House Ways and Means Committee.
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f40f50679ea102cbe7d59474cecf3822 | https://www.cnbc.com/2018/06/04/with-deal-to-close-this-week-bayer-to-retire-monsanto-name.html | With deal to close this week, Bayer to retire Monsanto name | With deal to close this week, Bayer to retire Monsanto name
The CEO of German chemicals giant Bayer Werner Baumann.Patrik Sotllarz | AFP | Getty Images
Germany's Bayer will wrap up the $63 billion takeover of Monsanto on Thursday and also retire the U.S. seeds maker's 117-year-old name.
The German drugmaker had received all required approvals from regulatory authorities, it said in a statement on Monday.
"Bayer will remain the company name. Monsanto will no longer be a company name. The acquired products will retain their brand names and become part of the Bayer portfolio," it said.
VIDEO1:1201:12DoJ approves Bayer-Monsanto dealHalftime Report
Bayer launched a 6 billion euro ($7 billion) rights issue on Sunday, a cornerstone of the financing package for the deal, shortly after clearing the last major antitrust hurdle in the United States.
The deal is the first of a trio of major U.S.-German merger deals to cross the finish line at a time of harsh criticism by U.S. President Donald Trump of Germany's trade surplus with the United States.
Deutsche Telekom's T-Mobile US plans to merge with Sprint for $26 billion, while industrial gases makers Linde and Praxair are also seeking to combine.
Bayer was expected to rid itself of the target's name. Monsanto, the largest - though not the only - maker of genetically modified seeds, has been a lightning rod for environmentalists' opposition to the technology.
The U.S. seed-maker has also drawn criticism for pursuing its intellectual property rights with farmers, many of which depend on its seeds, more aggressively than its peers.
"We aim to deepen our dialogue with society. We will listen to our critics and work together where we find common ground. Agriculture is too important to allow ideological differences to bring progress to a standstill," Bayer Chief Executive Werner Baumann said in the statement.
The companies' separately listed Indian units, Bayer CropScience and Monsanto India, will continue to operate independently, for the time being, Bayer said in a separate statement.
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c2c036b95000d9f4b182a3d1dadf4a82 | https://www.cnbc.com/2018/06/05/banks-are-on-the-brink-of-cracking-a-critical-level.html | Banks are on the brink of cracking a critical level | Banks are on the brink of cracking a critical level
VIDEO3:2303:23Trader sees trouble brewing for the financialsTrading Nation
The chart of the financials has reached a very precarious level, according to TradingAnalysis.com founder Todd Gordon.
Not only is the financials-tracking ETF (XLF) down about 1.5 percent year to date, but Gordon says its underperformance relative to tech stocks makes it among the most vulnerable in the event of a market pullback. Here's why:
• The XLF has fallen back down to the $26.50 level about four times this year. Gordon believes any weakness in the XLK could trickle down to financials, and push the XLF tumbling below that level.
• Furthermore, big bank names like J.P. Morgan, Wells Fargo and Bank of America have also fallen and are struggling to make a comeback.
• As a result, Gordon wants to buy the July 6 weekly 27.5-strike put and sell the July 6 weekly 26.5-strike put for a total of 34 cents, or $34 per options spread.
The trade: Gordon is suggesting buying the July 6 weekly 27.5/26.5 put spread for about 34 cents, or $34 per options spread.
Bottom line: Gordon sees XLF falling as low as $26.50 by July 6 expiration.
Disclaimer
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cb9cc3b359efa79f5ac8047c7a52639e | https://www.cnbc.com/2018/06/05/britain-to-rule-on-rupert-murdochs-bid-for-sky-on-tuesday.html | Britain to rule on Rupert Murdoch's bid for Sky on Tuesday | Britain to rule on Rupert Murdoch's bid for Sky on Tuesday
Adrian Sanchez-Gonzalez | AFP | Getty Images
Britain will give its verdict on Rupert Murdoch's pursuit of Sky later on Tuesday, potentially paving the way for the mogul's Twenty-First Century Fox to go head-to-head with rival Comcast for the European pay-TV group.
Murdoch launched his bid to buy all of Sky in December 2016, but the takeover has been held up by politicians and regulators who fear it will give the mogul too much influence in Britain.
If the government gives Fox the go-ahead to buy Sky — a verdict that could come with demands for more concessions — Murdoch faces another fight before he wins the prize.
Comcast made a rival offer for Sky in February, resulting in the Sky's independent board members withdrawing their recommendation of the offer from Fox, which already owns 39 percent of Sky.
Even if Fox beats Comcast, Murdoch's control is unlikely to last long because he has agreed to sell many of his TV and film assets, including its stake in Sky, to Walt Disney in a separate $52 billion deal.
Fox has offered undertakings to fund and protect the editorial independence of Sky News in order to win backing for its bid.
Culture Secretary Matt Hancock will make a statement on the deal later on Tuesday, the government said.
His decision comes after an investigation by the Competition and Markets Authority (CMA) into whether controlling Sky would give Murdoch, who also owns the Times and Sun newspapers, too much influence in Britain's news media.
(Disclosure: Comcast is parent of NBCUniversal and CNBC.)
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546c1fa63749bd72122f762e2c51022d | https://www.cnbc.com/2018/06/05/business-owners-say-goodbye-to-tax-break-for-steak-dinners-and-games.html | Business owners can say goodbye to that tax break for steak dinners and game tickets | Business owners can say goodbye to that tax break for steak dinners and game tickets
Thomas Barwick | Getty Images
If your small business woos new clients with dinner, drinks and seats to basketball games, you likely can't take a tax break for those expenses.
The Tax Cuts and Jobs Act, which went into effect in January, changed the way business owners can claim deductions for meals and entertainment.
Prior to the new tax law, employers were able to deduct 50 percent of the cost of entertainment-related meals, 50 percent of the face value of a ticket to a sporting event and 100 percent of meals provided to workers for the employer's convenience.
As of 2018, those tax breaks are facing changes.
That means there's no deduction for sporting events or for entertainment-related meals, and meals and snacks offered at work are 50 percent deductible for now but become nondeductible after 2025.
Tomahawk beef steak with lentilEugene Mymrin | Getty Images
Further, client business meals that were once 50 percent deductible under the old law will only keep that treatment under the new tax code if business is conducted.
"For many businesses, that affects them: A big part is entertaining clients," said Kathy Keylor, CPA and director at MAI Capital in Cleveland.
Accountants say the new law is ambiguous as far as whether certain meals and entertainment are deductible, based on the context. That is leading to confusion for accountants and their small business owner clients.
"For example, if a company hosts a party to roll out a new product, is that nondeductible entertainment or a deductible promotion cost?" asked Tim Steffen, CPA and director of advanced planning at Baird in Milwaukee.
"How will companies maintain the records needed to distinguish between nondeductible entertainment and deductible meals?" he asked.
The Internal Revenue Services offices in Washington, D.C.Adam Jeffery | CNBC
In April, the American Institute of CPAs sent a letter to the Treasury and the IRS seeking clarity over the new law's treatment of meals and entertainment.
"Because these expenses are nondeductible, it puts other things in jeopardy for deductibility," said Kristin Esposito, senior manager for tax policy and advocacy for the institute.
The change to the treatment of these expenses raises questions over things like whether advertising that's integrated with an entertainment event would be deductible, she said.
Charitable sponsorships that take place amid the backdrop of an entertainment event are also up in the air.
"Getting rid of the entertainment expense bleeds into things like advertising or charitable contributions," said Esposito. "These other areas became uncertain because the law doesn't fill it out yet. The IRS and Treasury need to draw the lines."
Getty Images
A more common, but equally confusing scenario, might be when a business owner takes a client out to lunch or for a drink.
"Is that considered entertainment and not deductible?" asked Steffen. "Or is it an actual business-related expense, and therefore 50 percent of the cost is deductible?"
Even snacks at work are in question.
Under the old law, employer-provided snacks, water and coffee were 100 percent deductible to the employer. Now, they're only 50 percent deductible until 2025. After that, they'll be nondeductible.
Don't worry if you enjoy throwing holiday parties and summer picnics at work, though. Those perks remain fully deductible to the employer under the new law.
Accountants are awaiting further guidance from the IRS and Treasury.
VIDEO1:1501:15Tax cut will be a "huge tailwind" for American businessCNBC Interviews
For now, the best practice for business owners is to maintain separate accounts for what's fully deductible and what's partially deductible and what isn't deductible.
"You should have an account for entertainment, another for business meals and another for holiday party meals," said Keylor.
"Make it very detailed; you need to know what kind of expense it is when you get the receipt and code it properly in the accounting system," she said.
"You can't dump it all into 'meals and entertainment' anymore," said Keylor.
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VIDEO2:4002:40IRS to issue rules for treatment of state and local taxesPower Lunch
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1fb3f79363c928bd72e38d34de5e9a49 | https://www.cnbc.com/2018/06/05/ceo-optimism-ebbs-for-first-time-in-two-years-amid-worries-about-trade.html | CEO optimism ebbs for first time in two years amid worries trade conflicts will hurt sales, drive up costs | CEO optimism ebbs for first time in two years amid worries trade conflicts will hurt sales, drive up costs
President Donald TrumpGetty Images
CEO optimism about hiring, capital investment and sales growth fell slightly in the second quarter from record levels, marking the first decline in two years amid concerns that trade conflicts could drive up costs for consumers and business.
According to the latest quarterly Business Roundtable CEO Economic Outlook Survey, the CEO Economic Outlook Index slipped to 111.1 in the second quarter, down from a record 118.6 in the first quarter, the first decline since before President Donald Trump was elected president.
The index is a composite of CEO expectations for sales, hiring and capital spending plans over the next six months. The index is still well above its historical average of 81.2 for a sixth straight quarter. But CEO expectations in each of the three categories fell slightly.
The survey of 132 CEOs specifically included a trade-related question, and it found CEOs are concerned about the Trump administration's approach to international trade issues. Ninety-five percent of the CEOs said there's a moderate or serious risk that foreign trade retaliation could lead to lower U.S. exports, while 91 percent said higher costs of imports for consumers was a moderate or serious risk.
Fifty-eight percent see a moderate risk of lower U.S. economic growth as a result of Trump's trade approach, while 41 percent see a serious risk of lower growth. The majority expect input costs for businesses to rise, with 47 percent seeing a serious risk of higher costs and 43 percent seeing a moderate risk.
Source: Business Roundtable
Expectations for hiring fell slightly to 95.5, off 3 points from the first quarter, while plans for capital investment dropped to 107.6, off 7.8 points. Sales expectations were down 11.6 points from the first quarter, to 130.3.
J. P. Morgan Chase CEO Jamie Dimon, who chairs the Business Roundtable, said "business leaders are expressing historically strong optimism about our economy — and that's delivering more jobs and increased wages to millions of Americans."
"To sustain this momentum, we need to ensure that we have competitive trade policies in place to provide the certainty necessary to deliver sustainable economic growth to create more opportunities for workers and families nationwide," he said.
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8ce56d66ac36022c326f13e5c7414c4b | https://www.cnbc.com/2018/06/05/cnbc-interview-with-apple-co-founder-steve-wozniak.html | CNBC Interview with Apple Co-Founder, Steve Wozniak | CNBC Interview with Apple Co-Founder, Steve Wozniak
Below is the transcript of an exclusive CNBC interview with Steve Wozniak, Apple Co-Founder, and CNBC's Arjun Kharpal at Money 2020 in Amsterdam.
AK: Steve, thank you so much for joining. I want to kick off first with Fintech, since we are at Money2020, Fintech and money. What are the big trends for you in this space?
SW: You know the same trend's being going on for kind of years, I mean you know companies came in like Square to make it easier for certain people to be involved with different procedures in the Fintech community – there was Android Pay then there was Apple Pay did it easy, Apple Pay is so wonderful, the most wonderful thing in my life. Almost every single store I go to I just tap the watch and pay with a watch, no no hassle. And I think that's changing how people want to do their retail purchasing use of money. When Apple Pay first came out I thought Apple oh my gosh was actually stepping into the banking area in a way, but I don't understand that business as well to know what is a bank, what isn't a bank. To me, a bank is protecting my assets and Apple doesn't have that role. Apple, Apple Pay is more of a transition.
AK: And in line with that trend do you see companies like Apple and other large scaled technology firms actually starting to get more involved in financial services as we go through the years?
SW: Yes I do because we're talking about huge companies that have huge savings wealth and all that. Ones like, you know, Google and Apple and many others you know absolutely want to find any way that they can extend their prowess, their monopolies into other markets even and becoming a bank rather than just a service centre for banks to operate is probably big and attractive financially, and you need something very huge for those companies.
AK: And so companies like, for example, we've spoken about Amazon and Apple and Facebook, these are companies with with millions, billions of users, and so do you see them actually getting into full-scale banking rather than just offering you know a payments system or something else?
SW: I I see them trying to get into full scale banking. A little bit of me says I kind of prefer banking to go in a more of a decentralised fashion to where the users aren't being at the mercy of the huge huge monopolies, since the way these companies often think, so I trust Apple the most. So there's that whole idea of trust. Am I really getting service, you know, what I deserve out of these companies. You know, you can even look to companies like Facebook and ask that question.
AK: You spoke about decentralisation, and that's a key theme of course for for bitcoin and cryptocurrencies, and as you look at bitcoin what kind of role do you see it playing in the future of finance, if any?
SW: Right, well I said decentralised and bitcoin is recognised for that. But I was intending my comment to be regards to a lot of banks to choose from and not just, you know, two or three or four major major players like, the tech industry always kind of thinks that way. As far as bitcoin I I think it's kind of interesting – I'm I also believe so much strongly in mathematics and purity and science as defying the world, and when humans put their own little scales and say no this is how we want to think and not follow the math you get wrong answers in my mind. So, bitcoin is mathematically defined, there's a certain quantity of bitcoin, there's a way that it's distributed, that people who who keep copies of the ledger have a way to get paid a little. And it's pure and there's no no human running it. There's no company running it and it's just going and going and growing and growing and surviving. That to me says something about something that is natural and nature is more important than all our human conventions.
AK: You previously mentioned that you bought bitcoin at around 700 hundred dollars and then then sold it all because you were kind of tired of watching the price movement. Have you bought any more bitcoin since then at a higher price?
SW: No, my point is I never invested in bitcoin. I was actually a little worried once – all of a sudden the price went up and I had a lot of money in bitcoin, I said wait a minute, I only wanted my bitcoin to experiment, to figure out how to buy things online, figure out how to go to other cities and find hotels and restaurants and places that would take bitcoin, even ATMs. That was my purpose, so once, I sold all of my bitcoin except one, I kept one to experiment with now and I have two Ether and that's it. So I am not an investor, I just, that was not my purpose at all and I don't think oh I want to buy more I want to buy more. To some people I had recommended things based upon travels in the world over and over I see bitcoin, blockchain applications used in in Ethereum and sometimes I'll recognise Ethereum. Ethereum you know is a platform and platforms tend to grow because they've got millions of people working on developing you know applications.
AK: Do you see bitcoin maintaining its dominance as you see the rise of these other platforms? The likes of Ether, or Ripple for example, and many of the other blockchain platforms that are coming to market.
SW: Yeah we've seen a hundred sort of bitcoin copies and some are faster, and some are a little centralised control, some have other advantages. Only bitcoin is pure digital gold. And that's the phrase that's used and I totally buy in to that. And all of the others tend to give up some of the aspects of bitcoin, for example, being totally decentralised and having no central control, that's the first one to have give up to try to have a business model. How the math on bitcoin was so correct that it still works.
AK: So, so digital gold rather than currency because Jack Dorsey, the Twitter CEO, recently said he believes that bitcoin could become the global currency of the world in ten years. And so, is that something you buy in to or do you see it more as something people park their money into and leave rather than a transactional thing?
SW: I buy-in to what Jack Dorsey says – not that I necessarily believe it's going to happen but because I want it to be that way. That is so pure thinking. Sometimes you wind up later on saying well I got sold, I could have been smarter.
AK: Do you have a view on, I know you said you're kind of sick of watching the prices going up, but do you have a view on actually how much value you think bitcoin could have in the future in terms of price?
SW: Bitcoin is, because it's regulated in its quantity, it's down to supply and demand, and as more and more people want it and demand it. There was a hype going on for a period when it went up to twenty thousand and now it's down to I don't know where it is because I don't ever track it, but so if the demand increases and it becomes more and more popular for more things and people start using it there is no extra supply. It's limited. It's fixed.
AK: And so, so for you…
SW: So in terms of dollars, you know currency, fiat currency of a country, yes bitcoin could will go up and up over time and it won't happen, it may be sloppy at first and things that change that much in life take a long time to change they tend to go slowly. You know, we had we had a crash in the internet age and I see that going on with a lot of blockchain things, including bitcoin itself right now.
AK: And are you worried by some of the fundamentals at the moment and actually if there is this bubble and we've seen some of that air come out of the market that could actually hamper the development of the technology?
SW: Well, I kind of disagree with that because it is, blockchain in all forms is so popular and being studied by so many people and in demand by so many companies to look into changing their business in the future. It may be long term. I do see it, as you said, as a bubble in the sense that there's a huge amount of interest in it right now but things aren't going to change that rapidly – that's what the internet bubble was about.
AK: And looking at the underlying technology, blockchain, we've seen a lot of banks experimenting with it. We saw a lot of companies starting to try and dip their toes in to that. How long do you feel it is until this becomes a widespread technology?
SW: I'm going to give it about ten to fifteen years – I would say the same as…Here was the internet, and the internet had promises of oh my gosh all your purchases online and your bank reservations, your aeroplane reservations, your bank accounts, everything everything was going to be online and the trouble is we had a big crash of all the companies who started off to compete that. And yet, here it is in 2018 – all of our life, everything we do with these third party apps to do this today, oh my gosh what this saved me, it's so wonderful of world it was the world we talked about then but it just doesn't happen instantly because people have to have their mindset changed, culture and tradition and status quo and all the way things are doesn't change that instantly when it's that huge.
AK: I want to just change tact a bit and to talk a little bit about Apple and the iPhone given that the worldwide developers conference is kicking off today. You said that the iPhone 10 is the first iPhone you wouldn't buy on day one but you do have one now – what do you make of the iPhone 10 since its launch? How have you found it?
SW: Ha, I think I talked to your organisation and said it's going to be the first iPhone I will not have on day one. Yes I wanted one, I was busy and travel, I had just spent hours and hours setting up an iPhone 8, so I wasn't going to have the 10 – of course, of course your article got heard by Tim Cook's office so he sent me an iPhone, an iPhone 10, and so I said ok if I'm going to have one I might as well do them all, and spent two nights, all night long setting up five iPhones for myself and my wife's iPhone 10s during a family wedding in Kansas. That's what I had to do. I mean, when you don't have much time, you don't have much time. So no, I was I was a follower of the iPhone 10, it was just a matter of when.
AK: What did you make of the actual device in terms of the the technological forward thinking of Apple versus you know say the iPhone 7 and the 8 as well?
SW: Plus and minus – the greatest thing about the iPhone 10 for me is a little more screen space for a size that fits in my pocket and as far as the Face ID, it really hasn't worked as well for me as a touch ID, and I really like the ones where you touch on the back, so so it's not it hasn't been like oh my gosh it's the greatest thing ever in the world. The worst thing about it though is the combination power of home key, home button has about eight different functions depending on when you push it and how many times you push it, and how long you push it and and it is kind of confusing. Even, and even the gesturing which was on Android phones that I used before that, even the gesturing got complicated as to when you hold and when you have to remember to touch it a second time and hold again, oh, it got more confusing and that wasn't the nature of Apple products. We thought out a one button mouse was better for beginners, because anybody could use it than a three buttoned mouse where you have to remember all these different things. The idea is it should be intuitive.
AK: Was the price too high?
SW: Well, I didn't really, Apple products are worth the price in my mind. The iPhone works so well with the watch, with the air pods, that it's just uh, it's just worth it. And for that particular iPhone the pricing really falls in with where prices of smart products, smartphone products are for their abilities. Yes there are some companies that try to short change things and not have much profit and there's some that try to make good trade-offs – if we leave this out we can make it a little less expensive but still do the main job, and I admire those companies too, you know, like Xiaomi in China but…
AK: Can Apple continue to rely on the iPhone for growth or does it need a big new product, and if so, what is that?
SW: Need, need, need. People have been saying that for a long time and Apple's revenues have just kept growing and growing and and the company valuation's held, so I trust the business insiders very much. A big new product, yes. What happens is you get to a point with your existing product line that it starts to level off and then it starts to become commoditised and going down in price, and Apple needs to keep you know its big size for the shareholders to be happy, they're the owners and so they need a new area. What is big in money, big enough for Apple to think of, obviously drives, cars. I mean, self-driving cars, electric vehicles, a new supply of who knows what, but that's a big one. Housing would be very big, you know if you had some automated housing manufacturing, banking is very big, insurance, you know it would have to move into some of these other categories or back into computers.
AK: And just on the iPhone, we've heard sort of reports that Apple could be releasing three new iPhones and perhaps one of those three could be a cheaper model. Does there need to be a lower cost model so Apple can target those less matured smartphone markets?
SW: I I'm actually for the lower cost models. At one point we introduced two iPhones – the iPhone 5c and the iPhone 5S – the S had your fingerprint detection and the c did not. The c was $100 cheaper, it was a smaller little more plasticy looking phone. I loved that phone. I loved the design of it, I think it was one of the best designs Apple ever did for how it looked and felt and worked in your hand. It did the main things at a lower price, it was a good trade off. So I hope that Apple does, I think that is an appropriate place for Apple to be.
AK: Fantastic, thank you very much for your time Steve.
ENDS
For more information contact Jonathan Millman, EMEA Communications Executive: Jonathan.Millman@cnbc.com / +44 7788 307 996
About CNBC:
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CNBC is a division of NBCUniversal. For more information, visit www.cnbc.com.
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4b9253f1152b4516fe3a890cb67ff6ca | https://www.cnbc.com/2018/06/05/despite-the-pullback-analysis-shows-oil-is-still-headed-higher--commentary.html | Charting Asia | Charting Asia
Pumpjacks in an oil field.Paul Giamou | Aurora | Getty Images
The NYMEX oil price has pulled back sharply from $72 to around $66, but that is taking place within the environment of a well-established uptrend.
In fact, the chart suggests that the pullback is not a change of trend, but it's instead just a temporary retreat.
There are three features that support the conclusion. The first feature is the long-term support level near $65. That acted as a resistance level in January and again in April. Oil has a well-established pattern of moving in trading bands.
The standout feature on the chart is the strong support level near $43 and resistance near $54. That makes the trading band around $11 wide and gives an upside projection target for the trading band near $65 which has been achieved and exceeded. Applying the same trade band projection methods gives a long-term target near $76.
The second feature is the location of the uptrend line. The uptrend line starts from the anchor point near $43 from June, 2017. The line has successfully acted as a support level and provides a good definition of the rising trend. It has been tested several times so it acts as a second support feature with a current value near to the value of the support level around $65.
The third, and perhaps most important feature, is shown with the Guppy Multiple Moving Average indicator.
The long-term group of averages is well separated and shows strong and consistent investor support for a rising trend. When prices retreat, investors enter the market as buyers. That is the most consistent trend support behavior shown in the GMMA indicator on the oil chart in nearly a decade.
The degree of separation between the long-term and short-term GMMA is also steady. The consistent degree of separation is a characteristic seen with stable trends. That again confirms trend strength and stability and suggests that the current retreat is temporary rather than the beginning of a trend change.
The short-term group of averages — which reflects the way traders are thinking — shows a low level of volatility. That group is not characterized by rapid compression and expansion, which shows that traders are buyers whenever the price falls. That tells us traders are also confident that the uptrend will continue.
Those support features and the trend strength features all suggest that the price of oil is experiencing a temporary retreat. The longer-term trading band target is near $76 and potentially higher. It is higher because the $76 level has no history of providing strong support or resistance.
We use the ANTSYSS trade method to extract good returns from this trend behavior.
Daryl Guppy is a trader and author of Trend Trading, The 36 Strategies of the Chinese for Financial Traders, which can be found at www.guppytraders.com. He is a regular guest on CNBC Asia Squawk Box. He is a speaker at trading conferences in China, Asia, Australia and Europe. He is a special consultant to AxiCorp.
For more insight from CNBC contributors, follow @CNBCopinion on Twitter.
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0f2c1815edd18fdeef079ed625538b01 | https://www.cnbc.com/2018/06/05/everything-jeff-bezos-invests-in.html | Jeff Bezos is so much bigger than Amazon — here's a look at his empire | Jeff Bezos is so much bigger than Amazon — here's a look at his empire
VIDEO1:5801:58Jeff Bezos is so much bigger than Amazon — a look at his extraordinary empireTech
Jeff Bezos is the richest person in the world, but his massive fortune extends well beyond being the founder and CEO of Amazon. Bezos has invested in tech companies like Twitter, Uber and Airbnb, and in 2013 Bezos purchased The Washington Post. He's also personally investing nearly a billion dollars a year to send humans into space aboard his Blue Origin rocket ships.
Here's a look at Jeff Bezos' empire.
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ab0349df71c5f09fe90f30935ab3bb08 | https://www.cnbc.com/2018/06/05/for-investors-looking-for-a-summer-fling-one-sector-could-fit-the-bill.html | For investors looking for a summer fling, one sector could fit the bill | For investors looking for a summer fling, one sector could fit the bill
VIDEO2:1402:14Trading Nation: Health-care rally ahead?Trading Nation
Health care has been the best-performing sector between June and August since 1990, according to a new Oppenheimer note. But if the sector rallied this year, not all names in the group would participate, said the firm's top technician.
"The overall sector is very mixed," Ari Wald, head of technical analysis at Oppenheimer, told CNBC's "Trading Nation" on Monday. "You want to key on industry selection here."
A strong technical picture for the IHI iShares medical device ETF suggests it could be the best-performing slice of the health-care sector, said Wald.
"It's breaking out to the upside, it's been a source of leadership, it scores very well in our momentum ranks (we like high momentum), and it's broadly strong, too," said Wald. "There's a lot of medical device companies that are participating and acting as that leadership. That's what we want to own."
The IHI ETF hit an intraday record Tuesday in its third straight day of gains. The IHI ETF, which holds names like Medtronic, Abbott Laboratories and Thermo Fisher Scientific, is up 17 percent for the year. That is far better than the XLV health care SPDR ETF's 1 percent rise.
"Where we want to stay away from is a group like pharmaceuticals," said Wald. "Take for instance the iShares ETF, ticker IHE, it's still below its 200-day moving average, it's relatively weak, it's underperforming, it's a drag on overall sector returns, stay away from pharma."
The IHE pharma ETF broke below its 200-day moving average in mid-March, a level it has not been able to recover since. The ETF, which holds names such as Johnson & Johnson, Pfizer and Merck, is down more than 2 percent for the year.
The overall health-care sector is in good shape, though extraneous headwinds have kept it from gains this year, said Gina Sanchez, CEO of Chantico Global.
"The health-care sector looks very, very strong – they have strong balance sheets, they're good dividend payers but they haven't really performed all year," Sanchez said on Monday's "Trading Nation." "You continue to have political rhetoric around the Affordable Care Act and certainly [President Donald] Trump's announcement that he wants to lower drug prices also adds to the volatility of this sector."
The health-care sector is the fourth-best performer in the for the year to date. The XLV health-care ETF's 1 percent gain in 2018 is weaker than a nearly 3 percent advance by the S&P 500.
Disclaimer
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7ecd692cdc0753648f9737eb8e0863ca | https://www.cnbc.com/2018/06/05/leon-cooperman-investing-tips.html | Wall Street legend Leon Cooperman reveals tips to give investors an edge | Wall Street legend Leon Cooperman reveals tips to give investors an edge
VIDEO0:0000:00Leon Cooperman reveals what makes a good investmentInvestor's Edge
Billionaire Leon Cooperman believes that no stock or sector is off limits when he's looking for investing. In fact, he says, he'd buy any stock or bond at the right price.
While the chairman and CEO of Omega Advisors says there's no secret sauce, he points to one thing as crucial: free cash flow. "Free cash flow gives companies the luxury to do good things, whether it's pay dividends, buy back stock, invest in new plant equipment, et cetera," he said.
Equally important is management and ownership and how they manage that cash flow.
Cooperman says he operates with the idea that stocks have a memory: "They know where they came from, so I tend to look at either the new low list or things in the middle of their trading range to get involved and I don't like to buy the new high list."
Cooperman founded Omega Advisors in 1991. The firm has approximately $3.4 billion in assets under management, according to its website.
His personal fortune is estimated at $3.2 billion.
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d252b31eec1a79365ed2a4a0245a43be | https://www.cnbc.com/2018/06/05/miss-america-dropping-swimsuit-competition.html | Miss America is dropping the swimsuit competition | Miss America is dropping the swimsuit competition
Miss Georgia 2017 Alyssa Beasley participates in Swimsuit challenge during Miss America 2018Donald Kravitz | Getty Images
The Miss America Organization is dropping the swimsuit competition from its nationally televised broadcast, saying it will no longer judge contestants on their appearance.
The competition began nearly 100 years ago in Atlantic City, New Jersey as a bathing beauty contest designed to keep tourists coming to the seaside resort in the weekend after Labor Day.
But it has run into resistance to the swimsuit, and to a lesser extent, evening gown competitions, that had come by some to be seen as outdated. An email scandal last December in which former Miss America officials denigrated the intelligence, appearance and sex lives of former title winners led to a shake-up at the top, and the group's top three leadership positions are now held by women.
Gretchen Carlson, a former Miss America who is head of the organization's board of trustees, made the announcement Tuesday on "Good Morning America."
"We're not going to judge you on your appearance because we are interested in what makes you you," she said.
Carlson, whose sexual harassment lawsuit against Fox News Chairman Roger Ailes led to his departure, said the board has heard from potential contestants saying, "We don't want to be out there in high heels and swimsuits."
"Guess what?" she said. "You don't have to anymore."
Asked if she is worried the show's television ratings might suffer because of the elimination of swimsuits, Carlson said she is not, adding that the swimsuit portion is not the highest rated section of the broadcast. Viewers seem to be more interested in the talent competition, she said.
She also said the group will make changes to the evening wear portion of the competition, adding it will not judge women on their chosen attire.
"It's what comes out of their mouths that we care about," she said.
The changes will start with this year's broadcast on Sept. 9.
Carlson said the Miss America Organization will emphasize its role as a scholarship provider.
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a59f746f46dcb6c6aff081c9aa98b871 | https://www.cnbc.com/2018/06/05/paul-manafort-freedom-at-risk-after-mueller-alleges-witness-tampering.html | Judge sets June 15 hearing on Mueller request to send Paul Manafort to jail because of alleged witness tampering | Judge sets June 15 hearing on Mueller request to send Paul Manafort to jail because of alleged witness tampering
VIDEO0:4700:47Judge sets June 15 hearing on Mueller's bid to send Paul Manafort to jailNews Videos
A federal judge on Tuesday scheduled a hearing for June 15 on a request by special counsel Robert Mueller to revoke ex-Trump presidential campaign chief Paul Manafort bail for allegedly trying to tamper with two potential witnesses against him.
Mueller, in documents filed Monday night, accused Manafort of trying to "suborn perjury" and get witnesses to conceal evidence related to his upcoming criminal trials while under home confinement in his Virginia mansion. Mueller asked that Manafort's $10 million release bond be revoked, which would result in the lobbyist being sent to jail.
U.S. District Judge Amy Berman Jackson gave Manafort's lawyers until Friday to respond to Mueller's motion, which was filed in federal court in Washington.
VIDEO7:5607:56The Trump-Russia ties hiding in plain sightDigital Original
Manafort's spokesman Jason Maloni said, "Mr. Manafort is innocent and nothing about this latest allegation changes our defense. We will do our talking in court."
If Manafort is jailed, it could ramp up the intense pressure he already faces to plead guilty and to begin cooperating with Mueller's ongoing probe of President Donald Trump's campaign.
Manafort, 69, is scheduled to go on trial in Washington in September. But before that, he is set to be tried on related charges in Virginia federal court starting on July 24.
Manafort is charged with a slew of crimes related to his lobbying work on behalf of Ukrainian political figures who were friendly with Russia. He is accused of secretly organizing and funding a group of European political figures to lobby in the United States for Ukraine.
He has pleaded not guilty in both cases. Manafort is the only American to have been criminally charged by Mueller who has elected to go to trial.
Several others, including former Trump national security adviser Michael Flynn and Trump campaign adviser George Papadopoulos, pleaded guilty after being charged by Mueller and agreed to cooperate with the special counsel's investigation.
Manafort's business partner Rick Gates pleaded guilty in February to conspiracy and to lying to the FBI. Gates likewise is now cooperating with Mueller's team.
Since first being charged in October in the Washington case, Manafort has been under home confinement. He occasionally has been allowed to travel, albeit with certain conditions, including that he does not commit any crime. Last month, he was permitted to leave his residence to attend the baptism of his grandson.
In his court filing Monday, Mueller accused Manafort of using an encrypted messaging platform to contact potential witnesses in the case, and influence their testimony.
Mueller's prosecutors previously had accused Manafort of seeking to influence public opinion regarding his case by ghostwriting an op-ed with a colleague who prosecutors alleged was connected to Russian intelligence services.
Mueller was appointed in 2017 to investigate Russian interference in the 2016 presidential election, as well as possible cooperation by Trump campaign officials with that effort.
President Donald Trump has repeatedly called Mueller's probe a "witch hunt" and has said there was no collusion with Russia by either himself or by campaign officials.
The charges against Manafort do not include claims that he colluded with Russia during the election.
Additional reporting by Kevin Breuninger
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484c35a1cc5a9cd6acf809eb704ec602 | https://www.cnbc.com/2018/06/05/ripple-ceo-bitcoin-is-not-the-panacea-people-thought.html | Bitcoin is not the 'panacea' people thought it would be, Ripple CEO says | Bitcoin is not the 'panacea' people thought it would be, Ripple CEO says
VIDEO3:1403:14Brad Garlinghouse explains the difference between Ripple and XRPThe Fintech Effect
Bitcoin is not the "panacea" to solve the problems that people thought it would, Brad Garlinghouse, the CEO of blockchain start-up Ripple, told CNBC in an interview that aired Tuesday.
Ripple is a San Francisco-based company that is developing a network for faster global financial payments. XRP is the digital token that financial institutions on the network can use to transact quickly. The currency and the company were founded by the same people.
XRP is traded on cryotocurrency exchanges and one is currently worth 65 cents. Garlinghouse, who emphasized that Ripple is independent of the XRP token, said bitcoin will have a role in the future, but not one that will see it solve major problems, such as becoming a global currency.
"I think it's (bitcoin) not going to be the panacea that people once thought it would be, where it would solve all of these different kind of problems... Instead, you're seeing specializations of different kind of ledgers, different kinds of blockchains," Garlinghouse told CNBC at the Money 20/20 fintech conference in Amsterdam, Netherlands.
He explained that the bitcoin blockchain, the technology that underpins the cryptocurrency, is "quite slow," whereas XRP transactions are "a thousand times faster."
The average transaction time for bitcoin was 42 minutes as of Tuesday, according to data tracked by Blockchain.info. XRP has a transaction time of four seconds, according to Ripple's website.
While many see XRP as a rival to bitcoin, Garlinghouse said it's not necessarily a case of one digital coin versus another.
"Well, I don't really think about it as one versus the other. I mean, it's actually unfortunate, I think, that there's some people in this, the crypto space, the blockchain space — for them, it's almost a holy war of one versus the other. I don't look at that at all."
"I think that what we're seeing is the overall growth of this space and there will be many winners," he added.
Bitcoin is the world's largest cryptocurrency by market capitalization. In another recent interview with CNBC, Garlinghouse said that cryptocurrency prices are influenced by bitcoin, but that could soon change as people realize the differences between different digital coins.
Elsewhere, Ripple has been hit with a class action lawsuit by a person who allegedly lost money buying and selling XRP. Ryan Coffey claims that Ripple violated U.S. securities law.
In 2013, Ripple Labs created 100 billion of the XRP coins in existence. Ripple owns about 60 percent of those 100 billion XRP, some of which are owned by the blockchain's founders. The lawsuit alleges that the founders "earned massive profits by quietly selling off this XRP to the general public, in what is essentially a never-ending initial coin offering (ICO)."
VIDEO1:3401:34Ripple CEO: It's very clear XRP is not a securityThe Fintech Effect
An ICO is a way for a company to issue a new digital token in exchange for money in order to raise funds. Garlinghouse called the lawsuit "outrageous."
"Here's somebody who held XRP for, I think, two weeks... and is making some claims," he said.
"Whether or not XRP is a security is not going to be dictated by one lawsuit... I think it's very clear that XRP is not a security, it does exist independently of Ripple the company. If Ripple the company is shut down tomorrow the XRP ecosystem would continue to exist. It's an independent, open-sourced technology.
"From an ownership point of view, owning XRP doesn't give you any ownership of Ripple equity. And also, as we just talked about, XRP has a lot of utility, so to me it's quite different than what a security you know looks like and I think ultimately we'll find that conclusion."
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c4b71ad0a9271ace3acd59dfb8a8194f | https://www.cnbc.com/2018/06/05/schultz-is-poster-child-democratic-candidate-former-yum-brands-ceo.html | Howard Schultz is the 'poster child Democratic candidate,' former Yum Brands CEO says | Howard Schultz is the 'poster child Democratic candidate,' former Yum Brands CEO says
VIDEO10:2810:28Not many have a better resume than Howard Schultz, says former Yum Brands CEOSquawk Box
Howard Schultz's mix of business and social successes makes him a great potential candidate for president, David Novak, co-founder and former CEO and chairman of Yum Brands, told CNBC on Tuesday.
"He's the poster child Democratic candidate," said Novak, founder and CEO of oGoLead, a digital leadership platform. "He's got an unbelievably great business track record. He's got a great social track record."
And Schultz, who will become chairman emeritus of the coffee chain, offers something new, Novak said on "Squawk Box."
"This is a guy who's very well positioned to have a unique point of view that he can bring to the political landscape," Novak said.
"[Barack] Obama was a community worker," Novak said. "From a marketing perspective, [Schultz] has a much different story."
Novak pointed out that Schultz, who announced plans Monday to step down as Starbucks executive chairman, effective June 26, has managed to balance "his need for profit with his social agenda."
Some of the ways included offering health care to full and part-time Starbucks employees, stock options and college tuition for some employees.
"And there's no secret that he is not a big fan of [President Donald] Trump and he's expressed concern about where our country is today," Novak said. "The big social divide and our status abroad."
Schultz, who previously said he's not interested in running for president, wrote in the employee memo on Monday that he would leave the door open to possible political endeavors in the future.
But in an interview Tuesday on "Squawk Box," Schultz declined to go into detail about his future.
"There's a lot of things I can do as a private citizen other than run for the presidency of the United States. And let's just see what happens," he told CNBC.
Harvard Business School senior fellow Bill George said a CEO as president would be "a big stretch," but said he would like to hear more of Schultz's views on a national level.
"I'd love to see him jump in there and compete with long-term established politicians," George said on "Squawk on the Street." "Could he make the big leap? I think we need a good contest to find out."
George, former chair and CEO of Medtronic, a medical device company, pointed out that Trump was a business owner, not a CEO. "It's a big difference," he said.
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0f7daba89b48c7c02548f03ed8cb65f3 | https://www.cnbc.com/2018/06/05/student-loan-help-at-work-could-become-as-common-as-401ks.html | Student loan help at work could become as common as 401(k)s | Student loan help at work could become as common as 401(k)s
RyanJLane | Getty Images
Student loan assistance, which started as rare perk offered by a handful of companies, is finding its way into the mainstream menu of workplace benefits.
This year, Fidelity began to offer businesses a way to contribute to their workers' education debt. Since then, more than two dozen companies have signed up and it expects that number to double by the year's finish.
"This is going to grow rapidly over time," said Asha Srikantiah, vice president of workplace emerging products at Fidelity. "We're seeing so many more people who have debt and who are overwhelmed by that debt."
Indeed, 7 in 10 college graduates have student loan debt. The average person leaves school $30,000 in arrears, while nearly 20 percent owe more than $100,000. Americans are now more burdened by education loans than they are by credit card or auto debt.
And nearly 90 percent of young workers say they'd commit to an employer for at least five years if they were offered help with their student loans, according to a study by the nonprofit, American Student Assistance.
"This is certainly emerging as a new and very important benefit," said David Pratt, a professor at Albany Law School who studies employee benefits.
Jessica Crowley, who receives student loan assistance from her employer New York Air Brake.Source: Jessica Crowley
Jessica Crowley used to dwell on an unpleasant thought. When her children began college, she'd still be repaying her own student loans.
But a few months ago, the company where she works announced a new benefit: student loan assistance.
Now, New York Air Brake, which makes train control systems, pays Crowley $166 a month toward her student loan balance, which means she'll be debt-free sooner than she thought.
"It's going to shorten my loan life by a couple of years," Crowley, 30, said. "It's going to be a big difference."
Helping employees with their education debt is a great way to attract new talent, said John Samaan, senior vice president and head of human resources at Millennium Trust Company.
The financial services firm began offering its employees student loan assistance a few months ago. Now, 20 percent of the company's 300 employees are already enrolled, Samaan said.
"We got a lot more inquiries from potential candidates," Samaan said. "People want to join us to be able to participate in this program."
This is certainly emerging as a new and very important benefit. David Pratta professor at Albany Law School who studies employee benefits
Options Clearing Corporation, a large clearinghouse for equity derivatives, also started providing its employees student loan contributions this year. More than 70 employees signed up within the first month, said Erin Smith, first vice president of total rewards at the company.
She said student loan assistance is the number one benefit being talked about at job and recruiting fairs.
"Most companies provide a pretty standard benefit menu, like medicine, dental and vision, so when you introduce a program that differentiates you, that really matters," Smith said.
More than 350 companies are administering education debt benefits to their employees through Gradifi, a Boston-based firm that designs student loan repayment programs for companies.
"It's as meaningful to recent graduates as 401(k)s," said Meera Oliva, chief marketing officer at Gradifi.
To be sure, there's some skepticism about how much the private sector can remedy a $1.5 trillion — and growing, outstanding student loan debt balance.
"The problem is we're treating the symptom of a disease — and the disease is that education is more expensive in this country than anywhere else in the world," said Pratt, the professor at Albany Law School who studies employee benefits.
VIDEO1:2301:23Student debt could hold back economic growth, Fed chief saysThe Fed
The country needs a more universal solution, like bringing down the cost of tuition, said Kate Bronfenbrenner, director of labor education research at Cornell University.
"It doesn't work if it's provided via employers, because it's always going to be a small amount that offer it," Bronfenbrenner said. "And they're going to provide this, but then take away that."
Indeed, the number of companies supplying the benefit remains relatively small — around 4 percent, according to the Society for Human Resource Management.
And one of the factors likely contributing to the nation's swelling student loan debt is that the number of employers helping their workers with their original education costs is shrinking.
Company contributions to undergraduate education expenses dropped to 53 percent in 2017, from 61 percent in 2013, according to the Society for Human Resource Management.
During that same time period, graduate school assistance at work also fell, to 50 percent from about 60 percent.
The problem is we're treating the symptom of a disease — and the disease is that education is more expensive in this country than anywhere else in the world. David Pratt a professor at Albany Law School who studies employee benefits
Still, the benefit can make a big difference for the employees who do receive it.
For example, if someone has a student loan balance of $26,500 on a 10-year repayment term with a 4 percent interest rate, a $100 a month contribution from his or her employer would free them from their debt three years earlier.
It can also help employees better take advantage of other workplace benefits.
Ed Farrington, head of retirement strategies at Natixis Investment Managers, said the company realized after annual surveys of 401(k) plan participants that student loan debt was hindering millennials' ability to save for retirement.
"We thought, what can we do to try eliminate one of those barriers?" Farrington said. "And we said we want to start helping people who are carrying student loan debt."
Maggie McCuen, who works at Natixis and uses the student loan assistance program.Source: Maggie McCuen
It seems to be working for Maggie McCuen, 26, public relations manager at Natixis, who's been receiving the assistance at work for around two years now.
"The money that I would have been spending on the student loan I've been reallocating to my 401(k)," McCuen said. "I think I've put away at least four times as much."
There's still an unfortunate tax hurdle that will likely stall the growth of a student loan assistance benefit, experts say.
Companies recieve no particular tax incentive for such contributions while employees must report their payments as income to the IRS.
However, recent bills seek to address this. Rep. Rodney Davis, R-Illinois, introduced the Employer Participation in Student Loan Assistance Act, which would make assistance employees receive from their bosses (up to a certain point) tax-free. Employers, for their part, could deduct "the subsidy."
Companies including Starbucks and Verizon have expressed support for the measure.
"Congress needs to take the next step and make this benefit tax free," said Mark Kantrowitz, president of Cerebly, Inc. and a student loan expert. "Most people don't remember that 401(k) plans started in exactly the same way about 35 to 40 years ago."
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