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Apple Planning to Invest $1 Billion in New Austin Campus; U.S.-China Trade; Stocks Pared Gains Ahead of U.K.’s No-Confidence Vote Decision; U.K.

December 14, 2018

xfdfw MORNINGS-WITH-MARIA-00

<Show: MORNINGS WITH MARIA>

<Date: December 13, 2018>

<Time: 06:00:00>

<Tran: 121301cb.231>

<Type: SHOW>

<Head: Apple Planning to Invest $1 Billion in New Austin Campus; U.S.-China

Trade; Stocks Pared Gains Ahead of U.K.’s No-Confidence Vote Decision; U.K.

Prime Minister May Survives Vote; Nissan Coup Speculation; Andrea Bocelli

Foundation; NFL Backs Prison Reform; 2020 NFL Draft In Vegas; Curry Accepts

NASA Invite; Future Of Cell Therapy - Part 5>

<Sect: News; Financial>

<Byline: Maria Bartiromo, Dagen McDowell, Lauren Simonetti, Cheryl Casone,

Jared Max>

<Guest: Brian Brenberg, James Freeman, Stefano Aversa, Vered Caplan>

<Spec: Apple; European Central Bank; Mario Draghi; Jose Canseco; Trade;

Health Care; Espionage; Theresa May; Brexit; European Union; Nissan; Carlos

Ghosn; Sergio Marchionne; Mitsubishi; General Motors; Mary Barra; Andrea

Bocelli; Matteo Bocelli; NFL; Prison Reform; Criminal Justice Reform; Steph

Curry; Podcast; NASA; Invitation; Cell Therapy; Orgenesis; Cell Therapy;

Biotech; Protein>

BARTIROMO: So what’s that a function, Dr. Greenspan? Is that a function of higher rates slowing demand? What? Uncertainty on the part of business managers? What do you think is happening?

GREENSPAN: I think it’s primarily been caused by the fact that productivity growth has come down very significantly. And as I wrote in the previous book to the one -- that’s not the one that just came out but the previous book, I go into some detail on why it is that the gross domestic savings is being crowded out by entitlements which are rising as, you know, at a rapid pace.

BARTIROMO: Yes.

GREENSPAN: But gross domestic savings is the key funding for capital investment in the United States. And a result we’re seeing capital investments slowing down and that’s the critical factor which is determining the 2-1/2 percent GDP growth rate so to speak.

BARTIROMO: Yes. Well, that’s a good point. We just had another guest on from Merrill Lynch who said he’s looking for Capex spending to be up seven percent next year. With all of these worry signs in terms of this slowdown, Dr. Greenspan, do you think a recession is on the horizon?

GREENSPAN: I don’t think so. I think what we have is stagflation, that is a slow economy but one in which inflationary pressures are building modestly but it’s not -- the type of economic system situation I should say which we should try to avoid and unfortunately we’re not in the process of being very successful.

BARTIROMO: How do we avoid it?

GREENSPAN: You take the -- you avoid it by resolving the entitlements problem. We’re not funding our entitlements and as a result we have this huge deficit, trillion-dollar budget deficit, and it can’t exist with that sort of phenomena without inflation remerging itself. So in the context of a slow economy, if you’re getting inflation being driven by monetary forces, basically the large deficit, you eventually don’t come out well the end.

BARTIROMO: Yes. One more implication of runaway spending. And these entitlement programs that need to be corrected. Dr. Alan Greenspan, it’s always a pleasure to see you, sir. Thank you so much.

GREENSPAN: My pleasure.

BARTIROMO: Coming up. Apple eyeing a new home. Details on company’s $1 billion investment and expansion. Then there’s an uproar against United Airlines today. We’re going to tell you what the employees across the country are planning. Stay with us.

(COMMERCIAL BREAK)

BARTIROMO: Welcome back. Apple expanding its presence in Dell computer country otherwise known as Austin, Texas. Cheryl Casone on headlines now. Cheryl?

CHERYL CASONE, FOX BUSINESS NETWORK ANCHOR: Big move here, Maria. They plan to invest about a billion dollars in a new campus that’s going to provide jobs for 5,000 people but could eventually be 15,000. Apple also announcing plans to open new offices in Seattle, San Diego, and Culver City, California adding more than 1,000 employees at each location.

Well, flight attendants for United Airlines are planning to protest airports around the world today. They’re upset about staffing cuts. There are 16 planned demonstrations including airports in Los Angeles, Washington, London, Tokyo, Chicago which is a major hub for United. They say that they do not expect flight delays because of these protests but still they are going to be underway. United, the stock up nearly 33 percent year-to-date.

Well, fewer people have signed up for the Affordable Care Act this year with the deadline to enroll just days away. It’s actually this Saturday. Despite the availability of more plans and premiums stabilizing, the nation’s uninsured rate could actually edge up again. According to the latest Fox News poll, 83 percent of Americans say healthcare is the top concern for them.

And there’s not going to be holiday party at the White House for the media this year. President Trump and First Lady Melania Trump weren’t scheduled to host the media for Christmas Party but annual parties such as this of -- really been held for years under a lots of presidents starting with Richard Nixon. Of course it’s well known at President Trump’s relationship with mainstream media organizations hasn’t really been so great lately, Maria. So the big party is off, so --

(CROSSTALK)

BARTIROMO: All right. Cheryl. Thank you.

CASONE: Yes.

BARTIROMO: Coming up. General Electric shares are up. Details behind the company’s $1.2-billion venture driving the stock this morning. Take a look it’s up 12-1/3 percent on G.E. Probably the best move we’ve seen in years. Then upgrading America’s heartland. We’re taking a live look into technology’s impact on farming in the 21st century. Back in a moment.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

NAVARRO: Prior to our tariffs going on China began not buying our soybeans as a way of retaliating against us. Here is the fact, Maria. They buy those soybeans regardless. They need those soybeans. China is the hog capital of the world. They eat 50 percent of the world’s pork. That pork is fed by soybeans and if they -- if they don’t buy our soybeans they get inflation, they get inflation.

BARTIROMO: Yes.

NAVARRO: They get riots in Tiananmen Square.

(END VIDEO CLIP)

BARTIROMO: That was White House National Trade Council Director Peter Navarro on the Chinese purchase of U.S. soybeans. This coming as thousands of farmers are gathering in Omaha, Nebraska this week for the Farmers Business Network’s annual event. Kristina Partsinevelos is there live with the very latest. Kristina, good morning.

KRISTINA PARTSINEVELOS, FOX BUSINESS NETWORK CORRESPONDENT: Good morning, Maria. So we are on central time right now. It is million about people having their coffees, getting excited for the day. We’ve got some really nice toys behind, I’ve been told this is the Mercedes Benz of the farming industry.

And I’ve got this amazing couple. They’ve been married for 32 years! And they work together. So let’s start with these two farmers. You guys have a farm for hogs, grain, soybeans. I want to focus first on the topic at hand, we’re talking about trade, we’re talking about tariffs, how has that affected your farm?

KRISTIN DUCANSAN, FARMER: Well, since August we’ve seen about a 20 percent devaluation or devaluing of our soybean crop and a pretty big hit in our hog industry or hog operation. Overall, not a good way to be going into the winter months when we’re looking at refinancing, and looking towards next year.

PARTSINEVELOS: How concerned do you find that it’s really going to benefit you? What about the subsidies, the $12 billion that the President offered in the summer? Are you feeling at least a little bit concerned or are you -- do you feel like you -- this -- you guys can tough it out?

K. DUCANSAN: We’re concerned. And the money that was set aside through USDA is helpful, pays a few bills but it doesn’t make or break an operation. I mean, we would like to have markets not aid. We’re very much involved and the fact that markets will lead our entire profitability. So as much as that 12 billion helped some families out, it’s not enough to put money in the bank.

PARTSINEVELOS: OK. Pat, can you tell me -- we are here in the -- the theme is -- there is a lot of tech, there’s a lot of computers behind me. How has technology revolutionized the agricultural economy and how are you using it?

PAT DUCANSAN, FARMER: So, we’re using data and we’ve been collecting data for a long time. This machine behind us collects data as we go across the field and harvest. And we also collect data when we plant, when we spray, when we -- almost every field operation. Also other areas a bag also collects a tremendous amount of data. Companies like Farmers Business Network helps us realize how to get information out of that data.

Not unlike almost every other business sector but agriculture is really progressive in collecting data and now companies are help us use that data and get information from it.

PARTSINEVELOS: Are you worried that this is going to, you know, all the people from Silicon Valley are just going to be coming here really quickly?

P. DUCANSAN: Well, they might be coming here to help us and that’s good, yes, yes. So it’s really good when they come to help.

PARTSINEVELOS: Great. Thank you guys very, very much. Best of luck with everything. I’m going to throw it back to you, guys. I’ll be here all day in Omaha.

BARTIROMO: Kristina, they do. We will check back. Listen, farming is important, it’s certainly an important industry for the U.S. and so we appreciate hearing directly from those farmers. Coming up. We are waiting weekly jobless claims in the November imported Mexico prices. We’ll have those numbers as soon as they hit the tape. Meanwhile, markets have accelerated the game. Dow Industrials right now up 57 points, the S&P is up 8-1/2 and the NASDAQ up 40 points, that’s two-thirds of one percent.

Up next, Super Bowl champ Victor Cruz is here in studio, he’s weighing in on the latest business venture and more. Hey, Victor. How are you?

VICTOR CRUZ, FORMER NEW YORK GIANTS WIDE RECEIVER: I’m good. How are you?

BARTIROMO: Thank you so much for being here. Great to see you.

CRUZ: Good morning. My pleasure.

BARTIROMO: We thought you --

(COMMERCIAL BREAK)

BARTIROMO: Welcome back. Good Thursday morning, everybody. Thanks so much for joining us. I’m Maria Bartiromo, and it is Thursday, December 13th. Breaking news, weekly jobless claims just hitting the tape, coming in at 206,000. We are expecting jobless claims of 225,000, so this is just hitting the tape. Not a major market reaction to tell you about. Although, markets did begin to reverse course, reverse earlier losses and trade up about 30 minutes or so ago. Dow Industrials now up 40 points, the S&P 500 is up 7-3/4, and the NASDAQ up 39 points, that’s two-thirds of one percent with the weekly jobless claims coming out better than expected actually.

In Europe this morning, take a look at the numbers because we did hear from Mario Draghi and he’s about to start his news conference. The FT-100 is down 5-1/2, the CAC Quarante is up four points, and the DAX Index is up 30 points. Mario Draghi announcing that he will end the bond-buying program in Europe, and we will wait to hear more about that from him in that news conference that will take place momentarily.

Asian markets all in the green overnight, higher across the board. Shanghai Composite and the Hang Seng are the best performers there, up 1- 1/4 percent.

Meanwhile, trade tensions look to be easing between the U.S. and China. China reportedly making a major soybean purchase from the United States. Early this morning, I spoke with the assistant to president for Trade and Manufacturing Policy, Peter Navarro. He says that China’s boycott of soybeans over tariffs would not have worked anyway, and here’s what he said.

(BEGIN VIDEO CLIP)

NAVARRO: Here’s the fact, Maria, they buy those soybeans regardless. They need those soybeans. China is the hog capital of the world, they eat 50 percent of the world’s pork. That pork is fed by soybeans, and if they -- if they don’t buy our soybeans, they get inflation, they get inflation, they gets riots in Tiananmen Square.

(END VIDEO CLIP)

BARTIROMO: Meanwhile, The Wall Street Journal reporting this morning that China is preparing to increase access to foreign companies. Little by little, we are seeing China change its behavior. The latest numbers are in. Gerri Willis joining us now with reaction from the floor of the New York Stock Exchange in terms of weekly jobless claims and expectations for growth. Gerri, good morning to you.

GERRI WILLIS, FOX BUSINESS NETWORK ANCHOR: Good morning to you, Maria. Traders down here really talking about China, U.S. trade relations, and to that point, we have imports dropping 1.6 percent. We’re watching this closely because we want to know if these import prices are going to spike because of these conversations, and, of course, the tariffs that both countries are putting on each other’s goods, weekly jobless claims coming in at 233,000, not a huge difference from the forecast of 226,000, not really moving the markets here. So, these numbers, we’ll continue to watch because they could have big -- show big changes in the economy, as these tariffs go into place.

Meanwhile, big headline on General Electric, they are launching a $1.2- billion industrial internet of things. They already have a business like this. It will be wholly owned and independently run by their own board of directors.

I just want to tell you, this is important, J.P. Morgan upgrading the stock to neutral and taking it off of its shortlist, that could be responsible for this huge spike in the stocks. Back to you.

BARTIROMO: All right. Thank you so much. G.E. stock up 12 percent, probably the best move in G.E. in years.

Now this, top business leaders, entrepreneurs, journalists, even athletes, launching a new accelerated group called “100K Ventures,” that’s 100,000 ventures. It gives early stage companies based in Flint, Michigan a much- needed investment boost. Joining us to talk about it is Super Bowl Champion and ESPN/NFL analyst Victor Cruz, Girls Who Code Founder and CEO, Reshma Saujani, and 32 Advisors CEO Robert Wolf. Great to see you all, thank you so much for joining us this morning.

CRUZ: Thanks for having me.

ROBERT WOLF, CEO, 32 ADVISORS: We’re so excited to break this with you.

BARTIROMO: Thank you so much for breaking this story here.

CRUZ: Thank you.

BARTIROMO: I know this is real important in terms of helping start-ups. How did this all begin? Tell me about 100,000 Ventures.

WOLF: Great. I’ll take it and then pass it to my founding partners. But we went on a bus tour with Congressman Tim Ryan of Ohio and Congressman Ro Khanna of Silicon Valley with other venture capitalists. So, Silicon Valley meets Industrial America, and we went to Ohio, Michigan, and Indiana. And then our stop in Flint, you just realize that there is an incredible spirit there, there’s entrepreneurialism like there is in New York and Silicon Valley people just don’t know about it. And so, we’re teaming up with Phil Hagerman and David Ollila who really are doing amazing work locally. They have the Ferris Wheel, they started this thing called “100K Ideas,” and we spent the last six months putting a group together, a diverse group of all types of entrepreneurs, and we’re going to invest and then help in their success.

BARTIROMO: And Victor, when you visited Flint in October, you saw lots of potential for start-ups. The entrepreneurial spirit is something that you know from your fashion business, tell us what you saw.

CRUZ: Exactly. So, just seeing the entrepreneurial, you know, energy in Flint was just amazing, and you had no choice but to help, you want to give back, you want to be able to serve these underserved communities, similar to where I grew up and where I came from. So, obviously, fashion headspace is something I’m well-versed in. And to be able to use that as a resource for these entrepreneurial people, in Flint, Michigan, specifically, is just a beautiful thing.

BARTIROMO: Well, Reshma, you’re an entrepreneur yourself, what do they need when -- where is the need in terms of these start-ups? What did you see that largely inspired you to join this group?

RESHMA SAUJANI, FOUNDER & CEO, GIRLS WHO CODE: Yes. I mean, look, Flint is a community of resilience and struggle. They’ve been through a lot. But I often think as an entrepreneur, when I started out, I doubted myself. I didn’t know if I had what it took -- what it takes. I see that in my girls in my program. And so, I think being -- us being there to encourage them, to support them, to like cheer them on, to like continue the legacy that’s already there in Flint is, I think, what we really want to do.

BARTIROMO: So, it’s not just advice, Robert, you’re actually going to invest?

WOLF: Yes. So, we want to be clear, this is not a foundation or a charity, there are plenty of people that are giving back to Flint. This is capital for good, we are going to be investing in these companies, and we call them an accelerator because then we’re going to take our expertise, that’s why we needed a diverse group from backgrounds, and then help them in their success. So, we’re going to put our name and our stakes behind it.

BARTIROMO: So, is this a political group in any way?

ROBERT: Zero. Zero. There is not --

BARTIROMO: Yes, zero. It’s helping these start-ups and entrepreneurs.

WOLF: You know, what’s interesting if you look at our group, we have Draymond Green. Draymond went to Michigan State. We have Michael Strahan, we have Christina Lorre (ph).

CRUZ: Frank Thomas.

WOLF: We have Frank Thomas, we have Michael Nutter. We couldn’t wait to get Michael Nutter because we want to take it to other cities. And so, we have Meena Harris, who started Phenomenal Women. So, we have a really diverse group and we’re very excited about it. But now, you know, once you launch, you got to get to business. So, next week, we’re seeing our first idea.

BARTIROMO: Fantastic. How tough was it when you started your business? What did you need?

CRUZ: It was -- it was very tough. I mean, the biggest thing for me was just having people that have done it before in my corner and having that advice, right? And having those people use those resources to my benefit and use -- just picking their brain. And I think that’s one of the things that’s going to benefit these entrepreneurs, is having all of these people from different walks of life and being able to pick their brain and use their resources.

BARTIROMO: Where do you see the industry -- I mean, what kind of industries did you see, what kind of businesses are starting up that you were able to witness?

WOLF: I think people don’t realize, this is every other, you know, city. It has fashion, it has culture, but it has industrial. Remember, you’re next to the auto industry, you’re next to the fashion industry. So, when we were there, we saw, you know, we saw a toymaker, we saw a fashion company, we saw an app that is looking at how they can do medical devices.

(CROSSTALK)

SAUJANI: Mental health. You know, we saw some -- you know, a former athlete who sees so many athletes who struggle once they leave, thinking about how he can offer them support. I think we see -- we saw every possible --

(CROSSTALK)

WOLF: We should be clear, it’s of this platform that Phil and David started to call the 100K Ideas, that’s backed by Phil Hagerman Foundation and (INAUDIBLE) foundation. 100K stood for --

BARTIROMO: I love that idea, 100,000 Ideas.

WOLF: -- 100,000 citizens in Flint. We’re going to help ourselves. So, they do this where people come in entrepreneurs and like consultants and then they come out and they get literally a great book on where they are as a company. And then, I felt when I saw it, wait a second, Phil and David, you’re leaving them at the altar. I raised my hand, we want to be the investing arm. So, we’re going to look and be the investing arm, and we hope to take this great platform they built to other underserved communities.

BARTIROMO: There’s got to be lots of technology start-ups. Also, technology is totally changing the automotive business. Do you see that from your Girls Who Code business?

SAUJANI: Oh, my God, so many technologies. I mean, technology is teaching everything about the way that we live and work. And I think for a lot of these young entrepreneurs, they see how technology can be used as a tool to advance the issue that they want to solve, or the problem that they want to invest in. And I think oftentimes -- what I love about this is, like, it’s literally a storefront and you walk in and you say, “I have an idea on this.”

And there are a group of people there who are there to help you. And especially, if you’re someone who doesn’t know how to code or may feel a little bit, like, intimidated by technology, they’re there to support you, and we’re there to invest in you.

BARTIROMO: That’s where the growth is.

(CROSSTALK)

WOLF: Maria, everyone thinks of Flint and they say, oh, we’re sorry about Flint. And I will tell you, you go there, the pride is amazing. I hope we’re there with you when we announce our first investment with the company. Because, I’m telling you, the spirit there is no different than if you go to Silicon Valley or New York City. There is this -- there is this feeling that, oh, you only can invest where the richest people live. We know that’s so not true. And by the way, you overpay with those areas. And this is -- so we’re very excited, and having Victor and Reshma, obviously, and the rest of the group, I mean, it took six months to get together.

BARTIROMO: Congratulations, Robert. Congratulations all of you on this.

CRUZ: Thank you very much.

SAUJANI: Thank you.

BARTIROMO: Before you go, I got to ask your Super Bowl picks.

CRUZ: OK. I’m going -- I’m going the New Orleans Saints against the New England Patriots. I know you like that, New Orleans Saints.

WOLF: And I’m going the New England Patriots. I don’t care who the other one is.

(LAUGHTER)

RESHMA: And I’m just agreeing with Victor

(CROSSTALK)

BARTIROMO: Hey, the game of football has changed at all, hasn’t it?

CRUZ: A ton. A ton.

BARTIROMO: I mean, we got people coming up, sometimes they’re afraid of concussions, they’re afraid of a lot of things, as a result of football.

CRUZ: It’s true. And in turn, you’re seeing little league football numbers drop, plummet because, you know, parents are afraid of putting their kids into little league football because of concussions and injuries, but you know, get those kids out there playing football, you just got to teach them the right way to play, and then things will start to change.

BARTIROMO: And maybe different equipment to protect the head better.

CRUZ: Yes, technology is always -- it’s ever-changing in the NFL across all sports, across all platforms, so they got to get those helmets right. It’s hard because it’s a violent sport, but they’re definitely trying to get it right from the helmet and concussion perspective.

BARTIROMO: An interesting point you make about little league, that’s too bad. Victor, it’s great to have you.

CRUZ: Yes. Thank you.

BARTIROMO: Victor Cruz, Reshma, thank you so much.

SAUJANI: Thank you.

BARTIROMO: Great to have you as well, Reshma Saujani. And Robert Wolf, always a pleasure. Congratulations.

WOLF: And thank you.

BARTIROMO: Thank you.

WOLF: We’re so happy that we’re here with you.

BARTIROMO: Thank you so much for breaking the news on this program. We’ll be watching the developments. We love entrepreneurial stories. And we will certainly be following it. Thank you so much.

President Trump just tweeted, this morning. We want to get to that. He says about Michael Cohen: “I never directed Michael Cohen to break the law. He was a lawyer and he is supposed to know the law. It is called advice of counsel, and a lawyer has great liability if a mistake is made. That is why they get paid, despite the many campaign finance lawyers have strongly stated that I did nothing wrong with respect to campaign finance laws, if they even apply, because this was not campaign finance. Cohen was guilty on many charges unrelated to me, but he plead to two campaign charges which were not criminal and of which he probably was not guilty, even on a civil base. Those charges were just agreed to by him in order to embarrass the President and get a much reduced prison sentence which he did, including the fact that his family was temporarily let off the hook. As a lawyer, Michael has great liability to me.”

All right. This, of course, on the heels of Michael Cohen getting sentenced to three years in prison. First, we’re going to take a break, then when we come back, good news for last-minute shoppers. What Amazon is doing as the holiday shopping season comes to a close. Then housing market meltdown, what the downturn means and could mean for home flippers. Housing market under some pressure. Back in a moment right here.

(COMMERCIAL BREAK)

BARTIROMO: Welcome back. Some good news for last-minute holiday shoppers. Amazon is extending free shipping until December 18th. Joining me now, the host of “VARNEY & COMPANY,” Stuart Varney to weigh in on that. Stu, good morning to you.

STUART VARNEY, FOX BUSINESS NETWORK ANCHOR: That is free shipping for everyone no matter how much you actually order, very small amount, you still get free shipping until December 18th. I’m astonished by this. They’re good, aren’t they, Amazon? Isn’t that an astonishing vote of confidence on their part that they could deliver -- what is it, a billion packages or whatever -- hundreds of millions for sure -- on time, right up until Christmas. That’s very impressive. What a logistical operation that is. And what kind of challenge does it pose to UPS and FedEx, who are also in the delivery business for these holidays? Can they match that kind of volume and the confidence that they’ll get it on time in the right way? Amazon is truly an extraordinary company. And, you know, I wouldn’t be surprised if that stock price didn’t get back up there as well.

BARTIROMO: Yes. Well, it is up this morning.

VARNEY: Yes, it is.

BARTIROMO: And we just hit a trillion dollars in market cap.

VARNEY: Yes.

MCDOWELL: I was just going to say, Stuart, be careful being excited about what’s free because the stuff has to show up, which has been a -- which is a problem. Like, I ordered some --

VARNEY: But they’ve got a good record though.

MCDOWELL: I ordered some shakes over a week ago. It was supposed to be there a week ago, still not here. DHL depot out in Brooklyn. They’re just sitting there.

VARNEY: I’m very sorry to hear that.

MCDOWELL: I’m very angry. I’m very angry.

VARNEY: That’s a tragedy. But nonetheless, have you seen apartment buildings in New York City recently? Just go and look at them by the day.

BARTIROMO: Oh, Amazon boxes are outside.

VARNEY: The main job of a doorman everywhere in America is fix those Amazon boxes and get them distributed to the tenants. It’s really something, it is.

BARTIROMO: Yes, that’s true. Stu, we’ll see you in about 10 minutes. I’ll be joining you later. I’m looking forward to that.

VARNEY: I’m looking forward to it as well, Maria.

BARTIROMO: “VARNEY & COMPANY” begins top of the hour at 9:00 a.m. Eastern right after MORNINGS WITH MARIA. Joins Stuart and company coming up as I will.

Coming up, flipping out. How the housing slowdown is hitting the fix and flip market. And whether it’s a warning sign for the broader economy. We’re going to dig deeper into housing, next up.

And then, Theresa May survives, for now. What’s at stake for Britain’s exit from the European Union? The fallout of yesterday’s no-confidence vote on the other side of this break.

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