and down by 35 now it's down by 8 the nasdaq up by about 16. we've also been watching yields and those yields of course, have been contained with 4.5% t two-year just below 5% at 4.9% that does it for us today, but we will be right back here tomorrow we will see you all then right now it's time for "squawk on the street. good monday morning. welcome to "squawk on the street." i'm carl quintanilla, with jim cramer and david faber futures are mixed. we'll pack a lot in. nvidia, fic minutes, and the whirlwind that is microsoft/open ai we begin with the sam altman saga, abruptly ousted as the ceo now hired at microsoft to create a new advanced ai research team. >> plus, big tech fueling the market rally the magnificent seven spots all

seeing big gains over this month so far nvidia by the way, surging more than 20% it will be reporting very important results tomorrow and we're keeping an eye on shares of boeing just to torture jim. it's getting a boost >> thanks. >> after an upgrade over deutsche bank. the recent acceleration of aircraft deliveries can be sustained. >> let's begin with the shakeup at open ai co-founders sam altman and greg brockman have been hired at microsoft to lead that research team just days after the home of chatgpt ousted altman as ceo a push to reinstate him be fall short, and nadella said they have to provide the resources needed for their success he remains committed to their partnership with ai working with the interim ceo shear who previously ran twitch. he explains to viewers how much this matters, some of the names our viewers may not know >> right i think that this was a real

company. i mean, it was valued at a price that i thought might be the number one ipo whenever it comes. it had a lot of fire power obviously ai is the thing that's going to drive the next level of the magnificent seven and i feel, david, that it's -- the open rebellion and the idea this company could disintegrate because the letter from employees, it indicates the company may dissolve. >> this is just a shocking and fascinating story in so many ways obviously you talk about a potential ipo at some point. you have to remember it was the unique structure of the company in and of itself that allowed this board to take the action it did for really what are still undetermined reasons sadly i can't tell you pbased on what i have heard with any confidence what it was about we can refer to the published reports that were following it saying maybe it was he was moving too fast in commercialization, and any other number of concerns perhaps, but the fact is to your point, jim,

$86 billion it was most recent value. that was something they were going to allow employees to sell stock at, and now it's unfair to be worth anything at all, especially given this letter you referenced in which hundreds of the company's employees are telling this board, you're the worst. you've jeopardized all the work and undermined our mission your conduct has made it clear you don't have the competence to oversee openai i find it rather risible this letter is signed by this guy, illya who seems to be the reason that altman and brockman left in the first place. >> look. i don't think -- it's very funny because we were talking about the argentinian election i don't want to draw too many parallels, but it seems like it's anarchy that's the word that comes to mind because i've never seen a major company get rid of the top guy who, you know, this is not

new, okay? this is a real company with guy who's obviously very important microsoft goes down 8 when he departs, when the company blows up and now it's coming back up, but it shouldn't be worth as much because he doesn't have a stake in a company that's worth a lot. i don't think i've ever seen anything like this other than the fact it just seems like the disarray that can happen with this -- the disarray that can happen is extraordinary. >> it's extraordinary. that said, you have private investors and capital and others who have put in significant amounts of money don't forget the $13 billion number that we hear with microsoft. a lot of that is actually made up of essentially what are cloud credits on asuhr meaning -- >> right >> means openai means computing power to run its language models and they use azure, and don't have to pay for it that's money -- credits essentially. that's included there. >> right. >> but jim, on the other side, microsoft gets altman and brockman and they get i don't know how many employees. they own 49% of openaxi and the

right to use their weights, the way they train these language models in perpetuity potentially and you can make an argument that says they come out of this looking much better than they were on friday. >> that's what i felt other than the fact that maybe people felt if they had a stake it would be worth a lot. this stock is down again today they're the winner. >> it's not clear. i talked -- they own microsoft and they will think ultimately they are the winner here. >> i think so. >> because again, they control a lot of the ip. it's unclear, you know, altman himself is now over there. by the way, he probably had a tough noncompete that basically meant he could only go to microsoft. that's conjecture. >> he had no shares. you also had this weird nonprofit aspect to it openai was a nonprofit and that's why elon musk was so upset with him because he changed it from a nonprofit and took this part it became chatgpt and made that the profitable part, but even as an investor, you were capped at

what was originally 100 times your investment, but there's a waterfall that actually lowered that multiple over time. it's a weird company. >> have you ever seen a company go from $80 billion to 0 >> no. >> what was it 40 >> i don't know what it's worth. i don't know, carl, but the fact is this is fascinating and especially this latest letter which basically seems to indicate that your point, either the company implodes or they reverse everything, or somehow microsoft takes full control, but i don't think they can because of the regulatory concerns there. >> yes. >> and that may be one reason microsoft didn't even have a board seat which you can still kind of question why for all that money they didn't have at least one board seat to stop this very thing from happening. >> it happened who is emmitt shear? >> you tell me. >> he ran twitch. >> that's what kyle voek did you win one twitch and lose one twitch. >> it's just funny the cell-side money is all out

of dates they say for the first time in two decades, this is an instance in which microsoft is not playing from behind on emerging tech and they've seen a lot of that >> i think that that -- i think microsoft's doing incredibly well without this. so i don't know why, you know, ever since -- ever since nadella came in, i think it's just been a total home run, and i think this is going to be, but david, one thing i think people are judging right now at home is, is ai a joke? >> no. >> i know. i mean, to me, but -- >> it's not a joke. >> it was a cheap one announce for zero no >> we can all speculate and again, this is all pure speculation on the part of people who tried to divide altman from his board, but maybe the next version of chatgpt is to powerful that they're afraid of allowing it to get out there. to your point, this is far from -- >> right >> -- nothing. this is, in fact -- i mean, i don't know have we had any -- anybody we

talked to's opinion we care to hearsay anything other than this is the most important technology we've seen in the last 30 years? >> it's funny i want to conflate this with mike wilson. he had a note that came out last thursday talking about, can the magnificent seven basically follow up? the magnificent seven, if it doesn't have ai, if amazon doesn't produce, if nvidia obviously doesn't produce, which i think it will tomorrow night, i come back and i say, you know, ai is how you're going to get these companies to the next level, and if whoever doesn't have ai or use ai is not going to go higher the only one that i would exempt is that apple -- they have a new cycle. maybe they can transcend it, but ai or bust for next year, but if they produce ai, you got to know you're in the magnificent seven. >> would you say the same thing about autonomous >> no. >> can we lose autonomous if we don't lose ai? >> we can lose autonomous. i feel so bad about that it's exhilarating.

in san francisco, the idea that instead of a lot of drunk drivers, and tired drivers, you've got drivers that are really on the case, and then kyle volk, to all the cities and it was a massive -- there was another one. a massive amount of money invested by gm, and, you know, they don't have a lot to show for it they paid a billion to him to buy the company. >> which while we're talking about, you want to -- >> what? we have the footage here they bought out that for $2.1 billion, and they talk about the $5 billion business and they had a 2025 -- this is gm they had a 2025 commitment to make a billion dollars in sales. i do not think they'll hit their target level >> it doesn't seem like it, does it >> no. can i just say that when i was out there, i thought -- yes. i went to the computer room. this was a juggernaut.

>> yeah. >> and everyone was thinking about a business based on it where cab drivers would, like, seek it. i don't know i think -- i think that the -- did we hit a peak? people will hate this, in interest in autonomous in interest. >> no. maybe it's a brief lull. >> a brief what? >> it's a lull >> what is that? >> we're lulling, and then we'll take off again no, then we'll take off again once we get the charging infrastructure right and the prices get -- we're not. it's only going one way and eventually there will be autonomous there's no doubt. >> but i think -- >> this had to happen with the horseless buggy. at one point, they were, like, horses kind of work okay it's, like, horses are good. >> the future is now >> they can take a corner nicely >> i think rivian's got something going. they make cars the cars are expensive right now, but they have trucks and a deal with amazon and they have a way to be able to get to -- look

you can get carbon neutral by using rivian, and i know that csx, the plan there, the ceo of csx was on the board of rivian, and they have a terrific show in williamsburg and i hope i can lock in and do this show from there. >> that would be nice. >> totally. >> jeffries does cut tesla to 210. they were at 250. >> that's problematic there, tesla. problematic. >> does it come back quickly to microsoft which is obviously the lead story we've spent a lot of -- >> not so obviously because i think x is pretty important. >> it is copilot though copilot. >> love. >> again, it's early days. >> i was someone who bought it. >> you need to have 300 seats. you need to have at least 300 people using it to get a subsc subscription. >> you can trial it. >> 360 bucks a year, i assume it's discounted, but this would be one of the biggest product rollouts of all-time. >> copilot, i think the beginning of what david's

worried about. >> those are people who owned the stock early. >> it's proven to be a force multiplier for those who use it as opposed to a way to be able to fire people. >> right >> force multiplier. that's my term and i really like it. >> no, i like that that make sense. in other words, a huge productivity tool. >> yes. >> but not -- right. you can just do more we don't get rid of you, we'll do more. >> people want to do presentations and they can do presentations for you that are flawless i continue to think that for our lives, if i want a summary of a company of what they're doing, it's easier to do chatgpt than go through the -- i'm also more useless because anyone can do that >> well, you look great today so regardless of -- >> thank you this is a new one. it's a new suit. >> the two of you are putting me to shame i have to up my game. >> the people that look at ai, i look at travesty just grandpa jim

>> i can't get over this letter, guys we'll come back to it obviously. >> the letter signed by the people who fired him it's hysterical. >> they started the whole problem. >> it would be like dunder and m mifflin. >> he signed the letter saying, i should be fired. >> right >> what branch is he in? >> chief scientist >> he's in the camden bridge >> where is the main office? >> not in allentown. no, it's in scranton it's in scranton. >> people who did this in the company, they have to go they've got to go. >> it's just a farce i went to "saturday night live," and they should have done that >> we'll do disney, citi, uber and we got some calls. >> we have so much to talk about. >> and penn, and kbh 'lgeyou set up for nvidia as futures go green.

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market set into this holiday week one of the stocks to watch, of course, nvidia due out with earnings after the close of trading tomorrow, jim. a lot on the line. >> they just keep putting out things just now they said -- they issued their new ethernet thing ai from dell technologies, hewlett packard. there's one thing that's for certain. they deal with hewlett packard, lenovo they don't make it something

exciting even though people think they don't get china, they're done i do not think that is the case. the flow that didn't go to china, can work a great deal, but everybody wants it. >> what is the most important metric that we're going to be focused on here, jim >> i think we need to see -- i know this is a little aggressive, but initial indications for revenue from the h200 would make me very happy. i don't know if they can give us that, but i think the h200 is so far ahead of what everybody else has, and it's such great demand that i feel terrific i would also like to see -- look subtly, what everybody wants this, including, you know, microsoft says they have something. amazon says they have something. my sources indicate that everybody just wants -- everyone just wants nvidia. so if you can hear that they are on allocation and they can't make them all and they're so far ahead of what they're going to announce, you can see the stock going even higher. provided you have a $2 billion revenue increase, they have to

do it -- they have to forecast -- that's the whisper and they'll do $2 billion more than people think. >> would that be like the summer guidance, the famous one >> the summer guidance was -- jensen's very funny and what he would tell you is that was the biggest miss in history except for the miss to the outside. >> do you like that? >> it's not mine >> that's a good one. >> but now if you got that number out there, it's got to be 2 $2 billion more. our expectations, they're already there. it's an easy miss, a real miss >> that's why i want something a little bit more ethereal i want a little h200 i want a little of the sense that it's really indispensable one of the things that i really like about nvidia, is when jensen talks about how when you buy one, even when they're expensive, the payback is immediate because they burn so much cooler, and, you know, if you take what oracle is doing, where they're putting up centers

everywhere, they buy a lot of chips when they were down so to speak, and i think it just says, you've got to be in the stock. if you play it for the quarter, i think you could be disappointed if only because this is not an icon. it's a company that we'll talk very -- i think very proudly of the h200, but that's the focus, not the revenues, but the street is looking for the revenues. >> it's going to be big. probably one of the -- >> very big. >> one of the deep moments for the tape all week long. >> tuesday night jeez >> we'll get cramer's mad dash countdown to the opening bell. don't go anywhere.

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gg jim. of course, opening bell about eight minutes from now we should talk about bayer, this clinical trial that failed this is a stock. we talked about tough talk, like, a week ago from the ceo saying, hey. we got a lot of revenues and no cash flow. >> right. >> this is not helping. >> look. there's a $21 billion market cap loss i feel like the people have to focus on the state of missouri which is a very pro-torque bar situation where the company has to pay just got a verdict a huge verdict, $1.5 billion $500 million each in punitive damages for these plaintiffs you've got a collapse of a big drug that was supposed to be -- >> right we've got two pieces of news one you're referring to which is the continued litigation over that product, and an award there of $1.5 billion, and then we've also got -- basically they were told to stop a trial, a direct

oral therapy for patients with atrial fibrillation at risk for stroke, which is everybody >> it was something bristol meyers, they're going down big you have to put this in the confines that you and i both know this is one of the major companies in europe, okay? >> bayer is, yes yes. >> there's a couple of big companies in europe. bsf, bayer, and when you see this company down, it can bring down the whole stock exchange. >> yeah in germany, yeah we're talking, again, one of the worstacquisitions, all the risks that came along with it and the liabilities which ended up being enormous and continue, and then -- and then back to just the unfortunate and disappointing results from this trial which as you point out, is also impacting bristol myers they have something as well they have been working on >> that was going to be their

bridge, and it was going to be their bridge off the cliff they have blood-thinners and $2.5 million to $3 billion for bristol. this was just a colossal, colossal decline and misstep for everybody, but david, i would point out, now, in that missouri loss j&j had a similar case. a similar case being it went to missouri and it was a $2 billion verdict. a $2.5 billion verdict and it held up. this is something that's not, like, they'll get that thing down it's exaggerated it ain't exaggerated two pieces of information for bayer are just disastrous for them. >> yeah, yeah. >> disastrous. >> we'll, you know, there it is. we'll keep following both, of course, and this continued decline in shares of both bayer and bristol myers getting hit as well opening bell about -- a little more than five minutes away. don't forget you can catch us any time and anywhere by listening to and following the

"squawk on the street" opening bell podcast we're ghbarit ck

up in the free market, deutsche upgrades and raises the target from 204 to 270 that's about 30% upside. they feel the jet maker's upward momentum in deliveries will be sustained. we have goldman added to conviction added by two weeks ago, and now this? >> i think we have been waiting and waiting and waiting and they had a lot of planes and once those planes are sold, which is going to be, then you begin to make a huge amount of money on the next iteration david, there is just so much momentum i am surprised that there is just so many orders, but then again, there are only two companies in this industry >> does it have legs does it continue >> well, look. i don't want to beat a dead horse here, but my -- i was a year too early because i felt that once they cleared out the inventory of the 737 max, you begin to see these gross margin

ramps that are going to be unbelievable this is a stock that won't stop here stock will be a horse for 2024 sometimes you get in too early >> the market seems to be saying that >> is disney ready >> is disney safe? disney's been on a bit of a roll. >> i think disney -- we didn't even talk about it, you know, happy anniversary to bob iger first year anniversary i think he's done a lot. a lot. >> yeah. i mean, most recently obviously with the strong quarter, there's still the prospect of a proxy fight coming >> absolutely. >> he does not want them on the board. you have value in a way i reported is going to be a shield almost, you know, mason worford standing there saying, if you need me, i can go on the board there's a lot of work to be done. >> yeah, but a lot was done, and people should understand that there is a lot of cash in the

balance sheet that they have -- they can do a buyback. they will do a dividend very shortly i think, and i think what's happened is, carl, that you have a company that i thought at one point might not be able to pay for the hulu, and that's ridiculous. it was $8.5 billion, and i think we have to think about this. and it's been added to tonight, eagles and chiefs. the ratings doesn't matter it doesn't matter. >> even without taylor in attendance likely -- >> interesting >> they did collapse down 75% from week one. we know what's going on with marvel. >> not everything is a hit, and i think dafvid's right. the challenges are large, and david, i think when you talk about this, there's a sense of, let's get on with this thing come on, start to make money, but i also think if you look at what's done in a year, something

bad? >> well, i mean, yeah. it's -- i think the challenges are even deeper than iger had realized. >> i think he made that very clear during our interview back in july where he outlined so many of those things >> too many movies were they making too much stuff? >> he said that as well, and he's talked about the quality decline and certainly the box office for this last marvel movie is a reflection of what may be less than great success. >> less than something at disney, they had already cut back big on twitter. >> advertising on twitter? >> yes before any of this practice, and i think we should spend a few minutes on another disintegration >> okay. >> x, the letter x x is not marking any spot from what i can tell, and i've got to tell you that i searched for a positive headline. maybe -- david may know the person who may be helping out politically. >> on what >> political >> linda's son. >> linda's son

you got to find someone, right hey, you know what my daughters would be fractious and unruly they wouldn't work for them. >> we all know x is not a public company, and so -- >> oh. so it's harder -- so what does that mean? >> you end up looking at tesla somehow as a reflection that musk may find himself in it in some way. >> but what do you think about the choice david, what do you think about the ads that are disappearing? >> there seem to be a lot, and, you know, in all seriousness, we've got -- we've mentioned this many times, one of the largest leverage bots of all-time obviously probably at twice what the company was worth at the time it was completed. >> right >> much to the chagrin of mr. musk who thought for some period of time he could get out of the deal by just paying the break fee of a billion dollars, and the bank sort of financed $13 billion of that, going, oh, this doesn't help. this doesn't help. this doesn't help. >> i remember when i started

this and the ad revenue went from, like, $20 million to $7 billion and we would call the advertisers and say, well, you know, we didn't notice any decline when we stopped advertis adve advertising. >> you said this over the weekend. >> then you say, no. i'm revanlt. it is a little bit like that, you know >> your points over the weekend is some of these companies are going to realize they didn't lose anything. >> they didn't lose anything and that's kind of what happens in advertising when you have a gigantic blitz on advertising and one of them doesn't hit. it's kind of, like, all right. if one of them doesn't hit, it's kind of like this stuff is going on well, david, i think that you say i would rather be in microsoft even though x isn't public >> yes, i think you might be certainly after what occurred on friday where there was a lot of concerns late in the day i was getting some calls of people saying, oh, what is this going to mean for

microsoft? saying i'm out at open ai, this large investment they've made. they own 49%, it's such a key part of they're sir strategy, aw sam altman and greg brockman and others work for microsoft now and many other employees too. >> if you are doing something as mission critical as this buildout, if you are at amazon, you can convince a customer you can't rely on this you need this as a secondary. >> i think one of the things that is so interesting about the announcement that we got just today when we -- well, a week ago. they announced this, but when you talk about what is going on at nvidia, you're talking about the spectrum x product and you can get it with a whole bunch of different companies. that's, like,, you know, one of the things that is really interesting about nvidia, is that you do go to any provider, like, you go to dell you go to michael dell and nv nvidia, and they've got a working relationship you go to hewlett packard enterprise, and they've got a working relationship you can get this -- you can get

nvidia's product from a lot of different people, but they will then help and you they have a softer layer and it's, like, a week late. i'm trying to figure out what david will talk about tomorrow night that's exciting because i think the expectations got a little high when i'm trying to hit something else besides the revenue. >> we're also going to get, tomorrow, we're going to pack so many things in lowe's, best buy, kohl's pretty nice look at the holiday spend. says apparel footwear inflations coming back to a five-year trend. it's the coldest winter in about five years. >> it matters. by the way, if you take a look, mine, last week may be the most fundamental non-tech story was how gap stores had a 1% increase in banana republic and you had a 30% increase in the stock. macy's is up 10% to 14%. kingsbury could have a turnaround at kohl's, said he used to be at burlington maybe that happens >> it feels like it, but the trend continues of companies are doing really not well.

>> that's my point i mean, if you do a 1% comp and your stock goes 30%, is this up 60%? macy's -- >> kohl's has a $2.7 billion market value now. >> here we go. here we go with the market cap >> it's a percentage gain to stock. >> to put it in some perspective. i mean, apple is -- is it a thousand or 10,000 times bigger? sometimes the zeros get a little -- >> it was as big as apple. >> what? >> you were looking at ant because you were trying to understand the ability to eviscerate value in openai >> i was thinking about president xi >> it was made what, four years ago or so? they basically shut down the ability to take ant, this huge financial services company public, which by the way never made it to the public markets. >> don't you think it's

interesting that you're comparing a communist dictator -- not a dictator sorry, incident mean that. a communist leader to the board which is now disintegrating to a company that was worth $80 billion. what is that >> i'm not making that comparison at all. >> you did >> i was because it was glib and facetious. >> yes, it was. >> thank you >> but the one thing it does connect on is getting rid of that much value that quickly i don't know what openai is worth. we're talking about a private company heres but that's okay. >> we talked about letter x. why don't we just do -- 10:00, we're doing all private company. >> we don't have a chart to show you, but if openai, we did have a chart, this is what it would look like. thursday, monday or maybe friday, monday. you like that. >> tracing on head and shoulders or reverse no >> what do you call that >> huge decline. huge decline >> if you are sitting here on my market cap, you're watching and saying, that's a lot of market cap. >> in the meantime, we got some real love for salesforce today

the cash rang in, and loves the quarter coming up, and salesforce has been to quote our friend will frost. congratulations there, and it's just a very exciting time. talking about durability, profitability, but most importantly, this is about the take and the level and the upside surprise and then it got thrown back. unbelievably just thrown back and it may be that's going to change the forces might change, and it could blow through. >> what forces would they be that change? >> well, there were a lot of people that felt that that was so-called last good quarter, and if it's not the last good quarter, it would be really terrific you know, there were a lot of last good quarters yesterday like the chargers, it was the last good quarter. >> oh, man five games decided by less than three point. >> i said to my wife that, you take yourself. there's no matinees and no idols anymore. twitter something. i don't know what did he say what did he say? grandpa jim.

i got that line. okay matinee idol i sent the guy a 5 to get to a new restaurant a new place to go. >> a 5 you slip the guy a 20. i said, i didn't want to go to the restrestaurant he gave me bad information i gave him back money. the world has passed me by. >> you're old. >> i was cosplaying. >> you were on the f train this weekend? >> cosplay >> on the way to bowling >> no. i saw a cosplay coming back from "saturday night live," and i was cosplaying with everybody else on the train. cosplay. google it. jeez >> oh my god >> by the way, i'm old too >> listen to them. they love that there's so much we didn't even get to i still want to go back to gm for a second the only reason i want to go back to gm is because i think that tesla -- there's a note today about tesla and bernstein, sluggish growth that this whole

concept of what's going to have to take off is making that group to be the worst group i've seen in a long time the auto and auto-related and i did a piece this weekend for my travel trust and for the investing club just these groups that have just been a black hole. i mean, drugs, autos, banks. david, banks banks. can't even get bank shares keybank. >> yes >> these are about the same price they were valued during the crisis how has this happened? >> the crisis being the -- >> the banking crisis. >> which one >> well, the most recent one for the global financial crisis? >> i'm looking at stocks and companies and everybody looks at the magnificent seven so i decided to dive into the not magnificent 493, and they are frightening in how much -- how bad they were doing. if you were diversifying, and i do this big, long sunday piece that my wife hates that i do, and it was about how

diversifications has just annihilated and i can't ever recall it's been so bad. >> what's x seven for the year they're up 60 basis points or something? >> such a bad year >> you focus on megacap growth and that's it? >> when i go away from megacap growth, i'm ridiculed for a company that's $10 billion so yes i was going to talk about sherwin williams >> that tiny dog >> jim, like, please the dutch bro. >> i made the market cap company. i get it you're right you're right i understand >> is that big how about kbh holmes is that too small? >> i don't know. seven stocks represent 29% of the s&p. >> i will do a program about seven stocks. >> by the way, that would get some ratings. >> just call it the magnificent seven. we know the theme music. >> i just want the ratings >> we're just going to talk

about seven stocks, that's it. >> i had more reaction by mentioning that someone did not live -- than someone who did live in the magnificent seven, more reaction than any other story. magnificent seven it is. >> thank you >> okay, good. >> let's talk about, which one do you guys want amazon, microsoft? >> amazon. we have black friday coming up, and get this let's see if david understands this do you know what the game is on? what network >> finding it? it's on amazon, but it's nbc that's distributing it i believe behind the scenes producing it. >> it's on prime >> it's on prime i just said that. >> it's another great thing amazon's doing >> the great new york jets team taking the field against miami >> is your son quarterbacking? they're looking for a quarterback. that was one of the ugliest -- >> you never know at this point. >> it was such a run for your life situation i felt so bad for the guy, the quarterback. he's no longer quarterback.

>> zach wilson >> he's out. >> you're being kind calling him quarterback. >> he's, like -- he's with ai. he's with ai he's out. >> it's been a very hard season, but, you know, as a new york sports fan, you got to get accustomed to it. >> i'm focused on disney rat ratings. i'm focused on by the way, the initial for espn, very good. >> we didn't mention the penn call out of -- is it b of a? they go to 30. >> it's very big the one thing i would say is they do have these bonuses where you can sign up. that's how i got involved. >> part of the call is discipline on promotion. >> i know. >> they think the espn optionalty is worth 8 bucks. >> to me, the greatness about these -- i don't know if you ever do this, but it's addictive. i don't want to tell you that, but you find yourself -- there isn't anything now we have fridays we're going to bet on. we wrecked thanksgiving by betting and now friday by betting. only saturday is spared unless

you bet college. >> on saturday night, it's on every network is college football that's all there is. college football. >> college football is very exciting we have four number one team -- companies, perfect the magnificent seven, ohio state, michigan. those are also big >> name, image, likeness that's actually a real positive for lobby players. how much money they're getting >> at the same time, david, baba cut numbers. baird, is that big enough or is that not big >> it's big. baba had a bad week last week after earnings, and the decision not to spend cloud exciting in part, the inability to get enough chips perhaps to do it. >> innvidia chip thing. they're still crucial. a couple of retailers i'm looking at that could be very big. i think dick's could be very big. i think bestbuy. i think bestbuy could be very big. >> speaking of baba in china, did you hear anything on jim

today? >> no, it's very short >> how about this piece? >> how about he sat next to the fr foreign minister, and nothing came of that >> i thought proximity would be good, but it didn't seem to matter. >> this piece, the china share in the global gdp is falling faster than when mao was in power. >> what? >> not a lot of shares coming in they left flowers and a lot of five-year plans, but not a lot of stock exchange. >> we don't talk about argentina very much. >> they elected an anarchist >> the first one in a long time. >> he wants to take it to the dollar. >> the central banks >> talk about inflation, 140% inflation. their economy is completely collapsed in argentina it's not good at all. >> we've seen some worse inflation. >> where >> myanmar >> oh, yes, but not here >> although jim here, gas

prices, thanksgiving food prices will be down four-year on year i don't know if you saw german ppi down 11. >> no. this is amazing. that's really conflationary. things are going powell's way, but the turkey, you have to go by tyson foods and poultry mix >> you mentioned the problems in autonomous ubers looking past all this >> it raises money the convert that rivian did, people shot against rivian, and they're not shooting against uber this is more ideal look at that that's actually up that's one of my absolute favorite stocks. you could not get an uber to save your life after "saturday night live". >> you've mentioned "saturday night live" about ten times. did you enjoy your time? >> it was fun. >> i have pictures of me coming back on the f train. >> dressed as momoa, what? >> man of the people >> yeah, miserable you don't look happy

>> the f train, there's nothing like it. that's what i have to say. >> for sure. the only way to travel is there. >> it's a rocket. >> the only way to go. uptown >> we're putting the subway in, and "saturday night live," and also nfl, and that other show david wants me to do the alternate show. >> yeah. >> seven stocks. >> versus david, did you see the snowflake early call >> the magnificent seven. >> what about wing stop? do you care? the wing stop sandwich is great. draftkings, 38 to 47 come on. let's focus. >> only talk about seven stocks. >> quick reminder, you can catch us -- you can always sign up for the cnbc investing club with jim. >> black friday deal black friday, a deal, you got to go there and it's -- >> seven-minute ads. >> you can't have six-minute ads. >> you can only have seven >> i don't know. >> go to cnbc.com/jointheclub,

or use the qr code on your screen as for fed speak, not a lot today. the curb is split. short end is lower, but the ten-year is still 4.45%. book in a minute ai has the power to automate, but if it's using untrusted data can you trust the results? your business doesn't just need ai, it needs the right ai for your business. introducing watsonx a platform designed to multiply output by tailoring ai to your needs. when you watsonx your business, you can train, tune and deploy ai, all with your trusted data.

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chip? at&t business. . despite the soap opera regarding openai which really began friday afternoon, 377 microsoft is a new all-time high we're going to watch that as the street tries to wrestle with whether or not the technology is entering a new chapter that's definitely helping out the dow. dow is up almost 34 points and ckn mont23ing on to 45 ba ia me

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. let's get to jim and top trading. >> last week, palo alto reported a quarter that i thought was very good you had to believe the new way to look at it, buildings were the best way. you want to look at what's performing what's left the stock is taking out where it

was when it had the so-called bad quarter, reminds people at home, don't blow out of a good quality company if initially it doesn't do well, the stock doesn't do well. they have a home run here and this is a sensational stock. >> you were not unnerved by the bofa downgrade on friday. >> please. you downgrade -- if you downgrade na kesha rohr, send me an invitation your funeral. >> to your funeral. >> come on, it's good. >> you like that >> yeah. >> right that's about jay and -- [ inaudible ] american ras call, one of the greatest books ever no one talks about it. >> you do. >> i do. my mother was a saint, but write a book about her who said that? nixon. >> what about tonight. >> it's time for levity.

i have o's, he knows. >> only seven stocks he can talk about. >> he can talk about a lot of things it will shock you. >> a number in mine mind, one in seven. >> say it to me, so i know it. >> right. >> we had that -- the fund, someone said i want you to think of somebody famous and the person said hillary clinton. no that's my job. you never know. >> jim, we'll see you tonight. >> absolutely. >> "mad money." >> i went to - >> it's good. >> yeah. >> "mad money" 6:00 p.m. eastern. wh wene return more on the shakeup at openai in just a minute .

good monday morning. welcome to another hour of "squawk on the street. i'm carl quintanilla with david faber, mike santoli, at post nine of the new york stock exchange sara eisen has the morning off a lot of news regarding tech over the weekend, but the shares of tech companies, at least the big ones, are powering forward the ndx, mike, taking out the july highs we'll watch that today. >> exactly it's ahead of all the other indexes. s&p 500 up about a quarter of a percent. 30 minutes into the trading

session. shares of baer hitting the lowest level after the company halted a late stage trial for a drug for heart disease the exprmtsal drug shown to be inferior to competing drugs. separately the company ordered to pay $1.5 billion in the latest u.s. lawsuit over its weed killer roundup. those shares down almost 19% a number of firms reiterating their calls. raymond james and key bank, they expect a solid beat and commentary stock up 240% this year tacking on half a percent. penn entertainment headed higher, bank of america upgrading the name to buy and raising the price target to $30 a share thanks to what they call a sports betting opportunity stock up almost 6% a big under performer versus draftkings this year. >> leading economic indicators out moments ago. let's get to rick santelli for that

rick >> yes, david. this is the 19th, 1-9, consecutive negative month over month change in leading economic indicators down .8%, a little worse than expected as i said 19 in a row. to find a longer streak, you have to go into the way back machine, april of '07 to march of '09 this particular number, well this particular number is equal to our april read which was down .8. you have to go back to march when it was minus 1.2 to find a larger one and that minus 1.2 was the weakest going all the way back to april of 2020. we do have a 20-year auction today at 1:00 eastern, 16, 1-6 billion, the japanese currency, the yuan on shore and offshore hovering at 3 1/2 months highs against the dollar post the big meeting with xi and biden. carl, mike, david, back to you.

>> thanks. i don't know how you keep them straight every hour. thank you. rick santelli. dow and the s&p are coming off the longest weekly win streak since july. nasdaq's longest since june as investors look ahead to the shortened holiday week of trading. mike has a piece about the nasdaq over the last couple years and we did mention the ndx back above this level from july. >> yes we're correctly talking about how it has dominated the market the handful of stocks that lead the nasdaq 100 most of the net gain for the s&p. the two-year anniversary of the peak was yesterday and the ndx is down over that period of time just slightly. you see down a little under 4% and compare it to the equal weighted s&p 500, as everybody is doing over a two-year span it's not that much of a divergence. last year the downside led by the mega cap tech stocks that had that valuation premium in there. of course fed hiking rates, all the rest of it along the way what is interesting is what we may have learned about it it's not a monolithic group that runs on kind of speculation and

momentum because, you know, tesla is down 40% over two years, amazon still down 20% and you have nvidia up 50, apple up 20 ai is part of that story, but also, balance sheet strength being able to grow in a tough macro environment. the top six stocks in the nasdaq are projected to be providing more than a quarter of the 10% earnings growth for 2024 if the numbers come in as expected. it shows you it is also chasing fundamentals and there's nothing uniquely rate sensitive about this group as we know because they've been performing with yields going higher. you kind of net out and say valuation has moderated in those stocks and you would love to see a broader list of stocks participate to the upside for a firmer rally and better macro message, but so far, the index has been kind of insulated by these extraordinary performers and it's not for nonfundamental reasons, i guess i would say. >> yeah. i mean, we're in a period now where we're getting a lot of '24 playbooks and whether kostin or adam parker, the playbook is to

still overweight some of these names. >> right. >> so, you know, i guess part of that is you just don't want to fight the indexes, a lot of hazard if you're trying to outperform being underweight these stocks but also, as i say, the clarity of the earnings trajectory, the nasdaq 100 now trades under 25 times earnings that's not cheap by any stretch but about the five-year average. it was at 30 times at the peak and we should remember, last year, you know, alphabet had a down year in earnings, amazon had a tough year in earnings it wasn't just about the valuations getting squeezed. >> what are we looking at next year then? i guess i'm trying to draw a sense of the trend here in terms of what you're telling me? >> it's rare to have a two-year draw down in the nasdaq 100. historically it's happened two times in the last 30 years that wasthe tech crash in the early 2000s and the global financial crisis big picture, the direction of mean reversion will help you that being said, if we just stay

flat right here and go to next october the two-year trend will look good. time will help us out. i think the issue is, when we complain about the extreme narrowness of the market, you're kind of saying what's wrong with this market? money is flowing to the highest quality companies with the clearest earnings outlook and it is an outgrowth of the rest of the market not being able to get out of its own way peak fed, peak inflation, peak yields, oil not a problem any more it's a matter of seeing what rest of the market can deliver to maybe balance things out a little bit i do think that's still an open question i do still think we're going to have late cycle psychology, waiting for the downturn in the economy even if we can't see it ahead of us. >> yardeni over the weekend said still bullish and may consolidate for the next few days before the rally resumes. still, 4600 by year end. they say a break above 4550 could signal good things for at least the early part of next year. >> the other way to frame that

is, yeah, 4550 looks like it should be some kind of resistance, might be getting to a high friction area, we haven't traded above this level much at all this year really for a few weeks. 4600, 2% higher from here. the all-time record on the s&p is about 48. so we're not that far from it. i do still think that it becomes a little bit tougher given the fact that you've already gotten like a 6% run in the fourth quarter to date, and, you know, it starts to seem like you're running a little bit hot and we don't know what we're going to feed off just now if yields don't come down. you can't argue with that idea that being flat on a two-year basis in the s&p doesn't sound heroic and that means decent upside from here. >> let's turn to the board room dlaum sent shock waves through the tech world one of the leading ai startups and maker of chatgpt firing ceo sam altman on friday and hearing he has a new gig with microsoft as shares of that name hit an

all-time high today. steve covac has covered this since the beginning on friday and joins us and deirdre bosa in san francisco with the shock waves across silicon valley and the ai landscape steve, start with you. >> it's been a roller coaster even over the last couple hours. here's the latest, carl. hundreds of openai employees reportedly threatening to leave the start-up for microsoft if the board doesn't give in to certain demands. those demands include reinstating sam altman and appointing new board members including former salesforce co-ceo bret taylor the current board members would have to resign potential exodus employees puts openai's lead in ai at risk and microsoft a chance to develop the technology in-house without relying on a volatile start-up the letter first obtained by wire says microsoft has already offered to hire any openai employee who wants to jump shift. no confirmation from microsoft by the way microsoft which owns a big stake in openai, failed to convince the board to reinstate altman

after his sudden firing. ceo satya nadella said to be deeply involved in that process but openai's board would not cave to demands altman wanted as a condition for its return and instead microsoft hired altman and put him in charge of a new group running ai at the company. openai named former twitch ceo emmett shear as its interim ceo who will investigate the mishandling of altman's ouster the letter signed by cto mira mir radedy appointed as interim ceo on friday immediately following altman's firing. if the board doesn't cave, openai is at risk of losing a huge chunk, most of their talent to microsoft there are about 500 names on the list of about maybe 700 employees at the total company. >> yeah. it's just a shocking series of events, steve, including, of course, this letter as you say signed by mira and elia, the chief scientist at the company

who seems to regret given his tweet as well his involvement in the decision to terminate mr. altman, he regrets his participation in the board's action, something that was when parted by altman microsoft specifically, steve, since you cover the company closely, you know, they continue to have access to all of the ip at openai in terms of developing the large language models. do we have a sense of what they're going to use and what the new effort is going to involve from altman and his team >> it's still early. they announced this seven hours ago or something but what we do know is, the relationship between these two companies all those products we see microsoft put out, david, co-pilot, for example, that's the big one, the one they're going to start selling, thought to be a huge revenue driver for them, that's all based on openai technology and you have to imagine anything microsoft might have on its product roadmap in 2024 would be reliant on openai.

if they suddenly lose hundreds of employees, that's going to hurt their ability to develop at least in the near term now if they can bring all those people in and work out their own language models without stepping on, you know, openai i.p. or anything, maybe that can work in the longer term. in the near term, the line out of microsoft we're dedicated to the partnership and relationship that we have now and that's going to continue. the question is, how long is it going to continue? we also know this contract betweenthe two companies is kind of wonky giving microsoft the option to stop investing and stop working with openai if certain milestones aren't achieved, perhaps. if that -- who knows when that out is going to come up, too, and whether or not microsoft accepts it david? >> we'll talk to deirdre about the implosion at openai itself you bring up an interesting point which is they're developing their own i.p. but imagine a lot of lawsuits potentially in the future given

altman switching sides what's his, what's the team's, what does microsoft own versus what openai owns, which as you point out, co-pilot is still reliant on. >> yeah. and then the questions also around just the talent drain that could happen, what kind of ndas do these people have, stock they have in the company, and then you want to talk about lawsuits, there are talk about lawsuits from not microsoft, but other investors who have put tons of money into the company, they're seeing value destruction here at this kind of what seems to be a spur of the moment decision to oust the founder and just cause chaos throughout the ranks. this is turning out to be a problem. lawsuits are sure to come. >> thank you let's move to deirdre bosa with more on the broader impact and whether or not rivals can take advantage of some of this. >> yeah. obviously, this continues to send shock waves across the vc and start-up community many scrambling to figure out the impact on generative ai. it's going to take time to build

a team, so questions here, does this give google and another ai darling a leg up in the arm's race every ai start-up is frantically trying to hire ex-openai employees. not just microsoft the idea of commercialization versus caution openai, we must remember, was founded as a nonprofit for the exact reason that they did not want a big tech company driven by profits to recklessly rush to develop generative ai first. they wanted to do it safely, to, quote, benefit humanity as a whole, and unconstrained by need to generate financial return that may seem unrealistic or far too altruistic especially to our audience, but the stakes are believed to be so high here, the negative or unseen consequences potentially so great that this unusual structure was needed the openai charter itself reads, we will always diligently act to

minimize conflicts of interests among our employees and stakeholders that could compromise broad bit of. -- broad benefit. we don't know what caused openai's board to oust altman. there was a speculation it was a conflict of interest, perhaps that altman began to favor commercialization over responsible development of the technology elon musk is someone who has had his own history and agenda with altman and the company itself, but i think it is worth bringing up this post from over the weekend. he wrote, i'm very worried referring to co-founder and board founder elliott thought to be behind altman's ousting, musk says he has a good moral compass and would not take drastic action unless he felt it was absolutely necessary you're aware, this makes this morning's letter signed and his post all the more confounding. it may be that this is some kind of desperate bid to keep 500

employees from walking out the door the whole industry here operates on research and data scientists and compute power. i thought it was telling that microsoft's ceo satya nadella's tweet ended with we look forward to moving quickly to provide them with the resources needed for their success by highlighting resources i think he's talking to the whole industry saying come over we have the compute power and the gpus to enable this technology. >> deirdre, the signing of the letter, you the board, he was a part and conceivably he made key decisions, are responsible for this, you should all resign, i don't know how to react. it's bizarre. >> neither do i. >> to say the rest >> neither do a lot of people i speak to, except it may be the idea he's just trying to keep the business itself afloat because it operates on the people that they hire, and it

had as recently be an $86 billion valuation. how does it keep near that if they're losing 500 employees. >> $86 billion they were valuing it as a potential for employees to sell shares we can only guess what the number is. it's far lower right now who are the losers here beyond those employees who own shares i know there are a number of others who are in there, i assume, and are going to have to take some bad marks potentially. >> there are a number of silicon valleys most prestigious venl tour capital firms se coy craze onya -- sequoia. they were bankers of sam bankman-fried. another mark against them. andreesen horowitz, post ventures they are the ones that have to maybe come out and explain what happened, and i guess a lot of the conversation as well, is

about what people knew and what they didn't know we know reid hoffman stepped down from the board. microsoft didn't have a seat that will be debated and discussed in the weeks ahead why was it structured this way what does it mean to be a nonprofit. how important is that? you talked about this before, the responsible development of generative ai is so important here, but, you know, right now, folks are trying to figure out where the money is going what does it mean for the long-term development of this and what kind of fears were raised over the last few days and weeks. >> the attention between commercialization and protecting civilization is a key here what a story, deirdre. we'll continue to follow it with your help. thank you. as we head to a break, a road map for the hour. one year since bob iger returned to run disney. shares essentially flat since then we're going to get one analyst report card on that tenure. >> plus, the biggest global story of the past half century may be over, at least according

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you want to be able to provide your child i with the tools orn resources they need. with reliable internet at home, through the internet essentials program, the world opened up. fellas, fellas. that's how my son was able to find the hidden genius project. we wanted to give y'all the necessary skills to compete with the future. kevin's now part of this next generation of young people who feel they can thrive. ♪ ♪ welcome back to "squawk on the street." today marks one year since that improbable return of bob iger as disney's ceo as you can see the stock has done more or less nothing since

then our next guest gives him a bf yo -- a b. joins us now, has a buy rating on the stock, 115 price target why a "b"? >> well, thank you, david. i think like any good report card, there are some -- a number of grays there's "a"s out there, lower grades, incompletes. when we thought through this process of assigning a grade we continue to be struck by the vastness of the company, both the challenges and opportunities that disney has ahead. so this first year has really been about bob iger putting, you know, fixing things, has been his message, and now putting the company in a position to build and grow so we do think that he's done a good job we assign that "a" value to some of the things he's done structurally to get the company prepared for the future, but those incompletes and those lower grades have to do with

things like actually delivering against those objectives some of the things around where the company is focused, we like focus on the disney brand of things where we think the company can be excellent and less enthusiastic about the general entertainment steps being taken and we would like to see more progress there. >> what do you mean, general entertainment is problematic what are your expectations in terms of steps so to speak when you say that >> i don't know the answer to it the first thing that company needed to do with with respect to general entertainment achieve resolution on hulu it's a bigger situation. you've talked about this a lot over the years, which is this move from the linear television channels system to an app-based streaming ecosystem. it is a very, very competitive marketplace right now where companies like netflix, warner brothers, amazon, apple continue to invest a lot and trying to win viewers over week after week when we think about disney, all

the work that they've done for the last 100 years of building brands, making acquisitions of branded assets folded into this great disney property, give them a bit of a head start competing for those viewers. when we look at the hulu, abc, fox studio side of the business, it is a fine business, but it's not the area where they can really break out from the pack using all that hard work that they've done for the last century. >> michael, what would you -- how would you assess the hand that disney holds relative to the competition? it seems, you know, if the views on this might have changed clearly netflix owns the new model in a sense those companies more dependent on the linear tv business, obviously, are more disadvantaged. in the world where every company is rethinking how much we're going to spend, how much we need to actually spend, to service the direct to consumer business, and all the rest of it, it would seem as if having the franchises and then the flexibility to figure out exactly how much capital you're going to put

behind those things isn't so bad? >> no, it's not so bad at all. there's complexity to the question, but i would point out a couple of things one, i think that it is a highly competitive marketplace like you sort of referenced and you think about netflix and we think netflix is excellent and they've become excellent by building a massive scaled business and being the leader in both of terms of delivering content to consumers and building a brand identity, but also in sourcing content on a global basis and they're truly unique in that regard in building their scale one thing i would point out about disney and there's a lot of concern about disney and the health of their content cycle as you guys know, there have been some hit films, some films like most recent release of "the marvels" that have not performed well and bob iger is focused on getting the company positioned to deliver quality, not quantity, in the future. one thing i would highlight the company showed very strong growth in their streaming subscriber numbers last quarter.

a lot of that growth came from outside of the u.s. and a lot of that growth was driven by brandeded content, "guardians" 3, "little mermaid." these are areas that shows rays of hope or reason to be optimistic the disney specific model does work and as investors see improvement in the content slate and the power of the disney brand driving economics, you can see more enthusiasm for the shares and share appreciation. >> yeah. finally, when commit to sort of news we may expect in the near term, you know, iger has been talking about strategic partnerships for espn since our interview or my interview with him in july. is there a scenario under which you can imagine some sort of partnership that would truly add value? i talked recently to john malone, for example, he didn't really get it. he's like i don't understand why they would do it i'm curious as to your thoughts about it >> this is an area where i agree with mr. malone. i have yet to see a clear definition or a clearly explained thesis on why selling

a piece of the business or striking a deeper ownership partnership is something that would drive value for the company. if i take a step back, the concept of vertically integrating content and distribution has not really worked well over the years you think about companies going in different directions with some distributors buying content, some distributors divesting content. the bottom line is for a business like a sports league, nbc, nfl, or a sports packager, you want distribution as broad as possible. you want as many monetization points as possible and as many consumer touch points as possible if you start moving forward in a path that alliance -- aligns those businesses too closely, you better have a good reason for how you're going to make up for the lost revenue by narrowing that breadth of distribution i don't see it yet with respect to that type of acquisition or investment we put that as a lower graded part of the report card so far

if they're going to do it we would rather they do it and explain why they've done it than talk about it in a speculative way. >> all right appreciate you going through all those different marks there. thank you, mikele. >> thank you still to come, the health care sector tracking for its worst year since 2008. find out why and the key names to watch right here after the break. .

welcome back to "squawk on the street." i'm dominic chu with this month's sector featuring the health care sector the second biggest sector in the s&p 500. worth about 13% of the weighting in that index. now it has been an under performer over the course of the past year to date period big gain for the s&p 500 overall, but meanwhile the health care sector as you can see there has been trending lower down about 5% on a year-to-date basis and well below its 50 and 200-day moving averages, trend lines traders like to look at. as for which stocks have been the most extended above their long-term trading averages check out the variety of names, not just biofarm sukcles and health care eli lilly is one of them given

the optimism around diabetes movies, molina health care and cardinal health on the supplies side of things, 20% above its 200-day moving average which ones are the ones that have been the worst, the laggards below the 200-day moving averages. some of these names, align, the parent company of invissy line dental products, moderna, down 37% below its and illumina, gene sequencing down 47%. keep an eye on some of the relative leaders and laggards compared to their long-term averages that's the health care sector. i'll send things back over to you. >> thanks very much. dominic chu. as we go to break take a look at some of the biggest gainers on the s&p boeing has a benefit from the upgrade we've got, second upgrade in a couple weeks. this one from deutsch as they go to buy paramount follows, palo alto indoors, sector wise energy is number two why china's rise is reversing and what that means for your

portfolio. rockefeller international ruchir sharma will join us to discuss in a momt.en (carolers) ♪ iphone 15 pro, your husband deserves it! ♪ (mom) carolers? to tell me you want a new iphone? a better plan is verizon. (dad) no way they'd take this wreck. (carolers) ♪ yes, they will, in any condition. ♪ ♪ get iphone 15 pro and ipad and apple watch - all on them! ♪ (mom) please forgive him. (carolers) ♪ it's all good - just a little awkward. ♪ (soloist) think we'll wrap this up. (vo) black friday starts now. turn any iphone in any condition into a new iphone 15 pro with titanium and ipad and apple watch se - all on us. that's up to $1700 in value. it's holiday every day, with verizon.

china has -- in the ft big piece of ruchir sharma talking about the share of global gdp falling at the fastest rate. ruchir joins us to talk about that piece, chairman of rockefeller international. thanks for the time today. >> thank you. >> you say it is a post-china world. you say their decline could reorder the world. you say that this recent appearance in san francisco did hint at some moderation. what do you think is going on and what are they doing about it >> i don't think they can do much about it. i think that's the real issue that we want to blame xi and all his policies and those in part may be hurting china's growth rate but the issues are bigger

look at their demographics and debt profile this is not a country which is going to grow at a rapid pace any time soon. they, in fact, should have already moved to a much lower growth plain were it not for the property bubble they were able to inflate for much of the last decade we're at a stage where we're at a tipping point and i suspect china's share in the global gdp will gradually keep declining for the foreseeable future this is in a way is a historic moment which is that in the 1980s, china's share in the global gdp fell to a low of 2%, and then it rose like no country probably ever has to a high of over 18% by the start of this decade last couple of years, it's sliding back down and i think that that is a huge shift that's taking place, pretty much like what maybe japan experienced when its share of the global gdp

slipped from 16 to 5 or 6% out i don't think it will be that dramatic for china, but i think that gradual slide back down has begun. >> yeah. the term japanfication has been used a few times and the property debt and unemployment and the collapse in foreign direct investments there was some discussion last week about why xi didn't make a more overt attempt to woo businesses when he had the ceos in front of him. what do you think that's about >> i don't think that in terms of only thatch that he can do because i think that he realizes this is more of a national issue, not about just talking to ceos and staff he's made up his mind that he needs to decouple from the u.s i think that china, this is an area of deglobalization now where a lot of the western parts could cut china off, the supply chains they can't do it in a dramatic way but that's the part. i don't think he wants to go

back to embracing the way china was integrated in the global economy a decade ago i think that it's very realistic stance he's taking in that way, i think he's been realistic, whether deglobalization or realizing the perils of too much debt, i think that there's a lot of realism which is behind china's policy here, even though at the surface it appears there's a lot of nationalism and bravado out there. i think that we are in a post-china world and for me it's equally interesting which are the countries gaining as china's share in the global gdp is declining? it's the u.s. and it's a handful of emerging markets which are gaining outside of china, india, indonesia, mexico, poland, and that's a pretty impressive list, i think, which goes unnoticed in the discussion between u.s. and china. >> ruchir, certainly the relative growers perhaps go unnoticed but from an investor's

point of view there has been a dismiss al of china as a growth story. massive under performance of chinese equities maybe because of the sense capital will not be treated well there what is the main takeaway from your perspective for an investor in the shifting dynamic? >> well, i think that it's about the fact that you've got to have some exposure to china just because it's always going to remain a very large economy, so to cut china off is very difficult, but i think that it's all about moving to these other emerging markets outside of china. that's the really big trend for me that's in place. i think for investors, it pays to remain engaged with china because things have got son beaten down and sentiment is negative and even in japan's case, like in the '90s, pretty violent bear market rallies of up to 50 or 80% or so. you have to be mindful of those rallies but the broad trend is a

diversification away from china to these other emerging markets. we've seen japan do well i think that trend is pretty much now that trend is on. it's likely to run for the foreseeable future. >> do you think it's overstated? china is so integrated in supply chains around the world, the level of it manufacturing prowess is higher than many of the countries you might mention here you know, i understand it's happening, but is it going to happen over a very long period of time that doesn't necessarily move the needle in the near term >> well, it's already happening at a rapid pace if you look at it if you look at foreign direct investment into china it has collapsed. if you look at what chinese [ inaudible ] are they're looking to put money outside of china. you've seen a fairly dramatic shift that's happening, but yes, because the cumulative investment into china has been so huge and it's not an economy

like russia we're dealing with where you have a much smaller committee and you can cut it off, this is an 18, $19 trillion economy, still huge, so the shift will be much more gradual and not a russia-type that you wake up one day, and it can completely cut the economy off it's happening the incremental flows into china have completely dried up but the stock is still relatively high because it's a very large economy. >> right talk about a mega cap. fascinating piece. got a lot of pick up today, ruchir thanks for the time. appreciate it. >> always a pleasure thank you. time for a news update let's get to bertha coombs with that. >> thanks very much, mike. let's go to gaza first heavy fighting and artillery strikes erupted this morning around indonesian hospital in northern gaza according to local authorities and eyewitnesss. the hamas-run gaza health ministry says some 700 people are being treated at that

hospital israel has not made immediate comment. more than two dozen babies treated at another gaza hospital that was the site of israeli raids last week have now arrived in egypt according to egyptian state media. the premature babies were brought into the country in a convoy of ambulances the world health organization says all of the babies are fighting serious infections. and a major elevated freeway in los angeles reopened to traffic today. one week after city officials say someone purposefully started a fire that closed down that busy byway the fire shut down a mile-long section of i-10 near l.a.'s downtown no one so far has been charged or arrested in that case back over to you, mike. >> thank you very much. up next, the read on retail as we kick off the holiday shopping season and one stock that you wouldn't expect to

benefit that's setting up to be a winner we'll be right back. stay with us

sutskever. friday kicks off the holiday shopping season as you know. let's get to courtney reagan with more on the setup one name that might benefit, a bunch of playbooks on holiday today. >> yeah. that's right, carl 'twas four nights before black friday and all through the house things need to be fixed. home depot might not be the first retailer you think of, but it's become an important time of the year they're the largest seller of live christmas trees in the country and their home decor items, the seasonal collection has grown 60% since they started offering it. black friday one of the busiest

online sales days of the year. home depot's reflected the year of moderation. the holiday season does provide an opportunity to pick up sales in decor and other categories to potentially make up some of those sales lost from the larger products new this year home depot's gift center highlights 15, 60, and $100 items which could help price sensitive shoppers battery powered tools a gift center focus and battery power is a $30 billion opportunity and growing. while many families may be looking for gifts this holiday season here at home depot, it's an important time of year for people to replace or fix broken items around the house kitchen appliances, for example, select packages, up to $2300 off. now home depot shares grew 6.6% last november 1st to december 31st this month they're up 8% in line with the xrt you mentioned a number of notes out this morning sort of skewing towards a ho-ho

happy holiday season jpmorgan saying online sales it looks potentially better than feared and goldman sachs btig surveyed consumers and seems like in both of those surveys the majority of shoppers are looking to spend at least what they spent last year if not more certainly still price sensitive and the higher income consumers driving the way. and if you didn't get that very fancy christmas tree that was selling out all over tiktok at home depot the grand duchess, there's other options still available. >> courtney, thank you very much plenty for you courtney, appreciate that. retail not the only sector hit by inflation grocers expect a cost conscious shopper heading into the holiday season prices rose 0.3%on a monthly basis from september tony sarsam joins us with his pulse on inflation, the consumer, for the holiday season tony, so you guys, of course, big distributor of groceries,

operate supermarkets themselves. 2% or so annualized food and home inflation walmart talking about deflation in some categories how does it feel to you and how are consumers navigating it? >> right let me give you a brackdrop. we deliver grocery and wholesale to over 2500 stores in the middle of the country. about 80% operate as small businesses and then the heartbeat of those communities it's a rural skew versus others. and we are, of course, knee-deep into one of our favorite seasons, eating season we're keenly aware of things like inflation, how it's going to impact shoppers overall we have -- he we've gathered information on shopper trends and what people are thinking about and a real feeling of wanting to get back to the comfort and nostalgia of family gatherings, as easy and convenient for folks as possible some of those trends we're seeing are things like people are getting to big family gatherings 12 on average from the survey data we collected.

lot of dishes. ten side dishes overall at the table. one of the interesting stats we found about 60% of the folks will be attending three or more of these celebrations. a lot of stuff they're doing, places they're going and all that complexity. a festive season but complicated and make it as uncomplicated as possible we're looking at things like how do we make and stretch their dollars further and make the season more convenient for them as well. we have some things that we've done in that space on your question about inflation we've worked hard to keep prices in check on those private label, our own brands and making sure we are aggressive on the things folks are looking for deals. some families are reeling from the inflation and some families have lost government subsidized for food benefits recently and that is -- has them hunting for the deals. that's one reason why there's another stat, i'll share that, folks are telling us they may wind up going to three or more stores to get their essential.

part of that is looking for convenience in items and good deals. we want to make sure they have the opportunity to trade up to our private brands. >> what about the inflation you are experiencing or have experienced on the other end we've seen retailers caught in a squeeze. >> there was a ramp up last year in 2022 and during that year we had the extraordinary inflation. we put together what we call our transformation program where we had a settled and productive way to think about pricing and challenge our suppliers that weren't taking prices above input costs. we've seen the prices have modified across the entire industry and we're also seeing that folks are looking to drive volume and they're looking for more deals and we're working closely with our suppliers to make sure they're great prices throughout for price sensitive shoppers >> one of the things that came out of the walmart call if you get deflation in necessities, you get a little more leaf in discretionary categories, do you think that's too aspirational? >> a little but we're looking forward to that.

we think there's a balance that could occur where there are folks who are looking as they stretch their dollars further on the cocategories looking for ways to provide more convenience and indulgence on items that might be more expensive. >> appreciate the time today thanks for stopping by. >> always a pleasure. >> not done not done covering t holiday season ceo of enterprise will join us we'll get a lot more as we get into the new year. that begins in about ten minus,1: a. stn te 100.meaer time - it's payback time. all these years you've worked hard, you fixed it, you looked after it. maybe, it's time for your home to start taking care of you. - [narrator] if you're 62 or older and own your home, a reverse mortgage can put more money in your pocket by eliminating your monthly mortgage payments, paying off higher-interest credit cards, and covering medical costs. - you paid down the mortgage, invested in your home. i guess you could say your home owes you.

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welcome back to "squawk on the street." u.s. trade restrictions continuing to make an impact on semiconductor companies such as nvidia the biden administration is trying to cap china's access to advance a.i. chips are these curbs too little too late kristina partsinevelos joins us now to explain >> the u.s. economic and security review commission seems to think so in their 700-page annual report they put out last week it takes aim at biden's controls saying importers can still allow exports. we saw that in the latest quarterly reports. over 40% of u.s. chipmakers came

from china in other words, china is still aggressively buying u.s. chip equipment, ever stockpiling. other examples that question the effectiveness of the export controls, companies like nvidia are making work-around chips to keep selling to china despite expanded controls that were just expanded in october. secondly, reuters reporting chinese search engine baidu will buy chips from huawei in a foundry in a shift away from nvidia that shows homegrown options are improving in china, despite u.s. sanctions. >> if you let certain products technology to go to china, i think there's an underestimation of how much china has the capabilities to improve on those technologies to basically leap frog in it the united states and achieve results, the exact results the u.s. government was trying to prevent. >> the u.s. government aims to prevent the most advanced technology from entering china affecting names like intel, amd,

nvidia, who all promise limited near-term impact but experts warn there is a more pressing impact to many of these chip names >> if the chinese economy doesn't get better or improve, actually, that's probably going to be the biggest risk factor to u.s. semiconductors as opposed to these restrictions, which are going tobasically just delay china, not really shut them down >> china is nowhere near shutting down, but we are expecting to hear just that from nvidia's earnings tomorrow after the bell, given the export controls are a major overhang for that name. over 20% of data center revenues come from china. other concerns in the report, supply constraints there have been issues getting all those gpus it limits revenue upside potential. gaming is expected to bottom that's still considered a weakness for nvidia. lastly, management will have to instill confidence that we are not in an a.i. peak and that demand will continue into 2024

so, guys, if you're expecting any numbers, the whisper numbers that come from the buy side, that seems to play a little bit of a role. expected revenue, $17 billion. q3 data revenue, 13.5 and the guide for q4, that ranged $19 to $19.5 million. again, these are the whisper numbers. >> you mentioned clarity that investors want on supply constraint and you want to make sure they still need demand into next year. which gives the idea of how much front load demanding has there been, how much hoarding and if the company can really weigh in on that to get ahead of any of those concerns >> precisely so, that makes the divide for the bulls and the bears for nvidia the bears arguing there's so much stockpiling, how will you see incremental revenue with all these gpus who's actually making money from adding these a.i. chips into the system the bull side that says, you know, with nvidia's next gpu that's coming out next year, that's going to be another

driving force, all of the search engines that need the generative a.i. for their search options will benefit so, it really depends on which side of the coin you are with this equation. that's going to definitely come up in the conversation tomorrow. >> thank you >> thanks. >> kristina partsinevelos. with the nasdaq, the best performer of the index up 6.3% that will do it for this hour of "squawk on the street. don't go anywhere. another big hour coming your way right after this

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welcome to "squawk on the street." i'm carl quintanilla along with deirdre bosa in san francisco. the stories ahead -- stocks moving higher following a big week of gains. can this rally hold into year-end with key data and one more fed meeting ahead we'll talk to citi's global chief economist. the 48 hours that rocked silicon valley and the a.i. world. we break down the implication of openai's decision to oust ceo sam altman. one year in after his return to disney, has bob iger made progress in turning the ship around at that company first, let's take a look at the market stocks are moving higher on the shortened holiday week the s&p at the highest level with tec