the houthis have launched their biggest attack on the red sea. it's wednesday, january 10th, 2024, and "squawk box" begins right now. ♪ good morning, everybody. welcome to "squawk box" here on cnbc. we're live from the nasdaq market site in times square. i'm beck request quick along with joe kernen and andrew ross sorkin. here we go. u.s. equity futures are showing a little bit of a weakness of the dow. this comes after a down day for the dow and s&p. nasdaq finished with some gains. this morning s&p futures up by 2.5, the nasdaq futures up by 46. if you want to take a look at the treasury yields it looks

like the 10-year is yielding 3.99%. we're down below 4% again. the 2-year yielding 2.3%. dave cal how acknowledged the mistake after a door plug on a 737 max-9 blew out in the middle of an alaska airlines flight last week. we've been talking all about it. he didn't elaborate what caused the incident resulting in the grounding of that aircraft. he said, quote, when i got the picture of the alaska airlines 737 max-9, all i could think about, i didn't know what happened to whoever was supposed to be in the seat next to that hole in the airplane. i've got kids. i've got grandkids and so do you. this stuff matters. the good news is no one was sitting next to that door panel. they found loose hardware on

that same area of other max-9s that have been inspected. meantime federal regulators saying yesterday boeing was revising its construction on how airlines should inspect the max-9 planes which would require faa review before inspections could be completed. we're going to learn a lot more today at 1:30 p.m. eastern time because we'll be speaking with dave calhoun. it's an interview i don't want to miss and i imagine a lot don't either. >> doesn't know like he sounds a lot more. i wish he knew more than we knew. i'm glad thathe realizes that was a problem if someone had been sitting there. it's weird that whatever they had been doing here toforeherett

picked up. >> you'd pay more attention. >> i think you'd pay more attention to the bolts. if you have torque -- i don't know enough about it, but, you know, you can tell from torque how tight things are. tighten those things. don't tighten them until you strip them. that's why you need one of those torque wrenches. every day we have such disturbing -- that was disturbing. this is disturbing. do we have anything -- college coaches have gotten bonuses. >> rutgers lacrosse team is showing up later. we'll take a look at them. >> are they any good? >> they are. they came out ranked 15 in the rankings that came out. they're visiting today because they have a lot of teammates who are very interested in wall street. they're going to bank of america, touring around. >> this isn't you. you didn't set this up. >> i did. they reached out to me. they're coming and doing a tour all over the place.

>> who else went there? didn't milton friedman? >> tony soprano, calista flockhart, ruth gaidar ginsburg. houthis have launched their biggest attack to date. coalitions shot down missiles and drones in the area occupied by approximately 50 merchant ships. in a statement u.s. central command said no damages very injuries were reported. this marks the 26 th attack by the houthi rebel group. the latest incident comes a day after u.s. secretary of state antony blinken warned in his words there will be consequences if the houthis continue to assault ships. major shipping companies have

diverted their travel to the red sea around a much longer route around southern africa. we're going to talk to retired admiral james stavridis later. my wife said, i cannot believe this is going to be a month later because something's -- i said, you're kidding me. she said, nope. it used to come through whenever it's not going through and it's going to go all the way around the tip. it matters. she goes, things that i had that i thought were going to be ready at this point are now, you're talking four weeks later, five weeks later. it's a long -- >> eiand it's more expensive. it plays into the inflation concerns we have. the s.e.c. said a post on the s.e.c. x account that said

bitcoin had been approved was a hack on the account. the chairman posted the s.e.c. twitter account was compromised and an unauthorized tweet was posted. the s.e.c. has not approved the listing and trading of the products. an official at x later posted it completed a preliminary investigation that found the compromise was not because of a breach of x's system but the unauthorized user obtained control over a foam number associated with the s.e.c. account and they did not have two-factor authentication enabled. this is why it was a pretty believable post. >> it's odd because, of course, gary gentzler has gone on twitter saying we had not approved it and i imagine we'll see a tweet later today saying we have approved it. >> but this wasn't the -- you

don't think this is the one that's been written up by someone at the s.e.c. -- you know how an early obit gets released -- >> if that's the case, they have not been forthright. >> also saying it's an unauthorized person, i would imagine somebody else got ahold of it. what it does say is what's the move going to be? >> bitcoin jumped up $48,000 but very quickly -- >> we talked about buying the rumor or selling the news. there have been a lot of people selling over the months expecting it to happen, and the question is what is the value proposition long term? >> i don't have to -- i don't want it. >> why? >> because that's -- some of the stuff i tweet, i don't want anyone proving that we me.

if you were me, would you? >> i think you're inviting a problem. >> oh, we're on tv every day inviting problems, aren't we? people want to -- you know, which of our tens of dozens of viewers that we have at 6:00 a.m. are going to do something bad, andrew? >> well, we are going to continue talking about this bitcoin situation. we have fundstrat's tom lee joining us. meanwhile hpe buys juniper networks. hp is going to be paying $14 billion cash for juniper. juniper shares jumping 20%. it's bringing its market value to around $21 billion, juniper sells communication network software and services its equipment and operates a growing

ai business that tries to operate machinery using wireless access. >> excited about tom lee. coming up, he's going to join us on the latest bitcoin etf saga. my question is going to be, what's your thing now? are you doing market predictions by the week? by the day? you need ten days? are you doing crypto predictions? are you -- can you help me with many of the wild-card games this weekend? and if you're looking for a new job, listen up. this morning's cnbc make it launches a new online course for when you're going for your next job. in a series of lessons, experts help you perfect your resume, your master interview psychology. psychology. you need tha

ameritrade is now part of schwab.t. sign up for courses. we're coming right back. tailor-made for trader minds. go deeper with thinkorswim: our award-wining trading platforms. unlock support from the schwab trade desk, our team of passionate traders who live and breathe trading. and sharpen your skills with an immersive online education crafted just for traders. all so you can trade brilliantly. you know what's interesting these days? bitcoin. look for bitwise, my friends.

check out the shares of bitcoin. it's been on a wild ride over the last 24 hour, but it's been, i don't know, doubles recently. the cryptocurrency jumping to

nearly $48,000 after the s.e.c.'s x account was hacked and posted at the agency had approved the spot. it was quickly disavowed and the price came back down. the s.e.c.'s decision is expected, though, some time today. joining us now, tom lee, a cnbc contributor. you brought this on yourself. we're bringing you a bitcoin story. the great thing about you, you can be -- we have people who pretend to be experts about everything. i have, as viewers know, an opinion about everything. it's not unusual for you to be thinking about bitcoin. you were right last tight. it was at 4,000. what's going to happen now?

let's talk bitcoin. >> well, i mean i think yesterday's compromised tweet is a reminder you have to find something you can trust in a trustless world, which is bitcoin. it's really still an immunable blockchain. one of the things we're still waiting for is the bitcoin approval because it's going to be the first on-ramp for a lot of folks to use traditional financial products to get exposure to crypto, and i do think it's inevitable. i think the timing is uncertain. i think many expect something this week. but when it does, it's going to be very good for investors to get exposure, and i think the impact on crypto prices will still be quite positive as well. >> i just -- when you say -- when people look for something trusted and you equate that to

bitcoin, the bitcoin skeptic or the warren buffett, the late charlie munger, the jamie die m dimons, the beanie baby, rat poison crowd, when they hear that, their head must explode. >> it still offends a lot of people, but something to keep in mind is the 10 million, maybe 100 million exchanges on the blockchain, zero have proven to be fraudulent since inception. if you look at the last ten years, the financials that are questionable, it's close to 60% of activities are suspicious. so the bitcoin proof of work blockchain has proven to be quite resilient and censorship-resistant, and, again, there's never been a rewritten entry. >> right. i just -- i don't know.

maybe they need to look into it. i don't understand how jpmorgan can be involved in certain ways with the etfs and assets. very odd. okay. you also came on, made a great call about some upcoming inflation numbers and what it would do to the s&p. what do you see your expertise as of now in terms of stockmarket predictions? will you do a week? do you do a day? do you do these options that expire in like eight hours? do you do those, or can we stick with six months in one year? what would you rather do today? >> i'd rather stick with six months to one year, joe. >> okay. tell me what's going to happen then. >> i think 2024 is ultimately going to be a good year in stocks. they're no longer fighting an inflation war. we know that ism manufacturing these pmis are bottoming and

that's correlating with earnings that are beginning to accelerate, and we know there's been pent-up spending on capex. that accelerates. that's good for earnings, and we expect mortgage rates to fall, which would be good for consumers, so it's really going to be a good year for stocks. but the caveat being the first six months, probele a little more challenging because in the first six months investors are going to be a little itchy or anxious for the fed to do their first cut and that uncertainty is going to weigh on stocks. and at the same time, it's going to bring back those who are fearful inflation rears up. i think it's a good year overall, but most of the gains come in the second half. >> this is a simple case of consolidating some of the outsized gains we saw at the end of last year? >> yes.

as we all know with parabolic moves, you might have to decline a bit. i wouldn't be surprised if we have the market down, you know, as much as 5% by march, but that's really going to end up being a pullback you want to buy because i mean we're not having a hard landing. the only risk to our view would be if we have a recession. >> that would be the risk. you think it's 20%, 30%? what is the risk of recession in your view? >> i think it's low. in a typical year, the odds of a recession is 20%. i think it's probably around 20%. maybe even less because i think what investors have priced in is greater than 20%. as you know, there are many people skeptical thinking the only way a fed cycle ends is with the recession. so many think you're going to have a recession because of the yield curve.

it's cautious. i think the recession odds are low. >> we don't have the -- companies doanlet have the revenue boost from raising prices or probably won't anymore. so i don't -- what is your earnings picture for gains in 2024? is it 10% on the s&p? >> yeah. pricing power instead of -- i mean only a handful of companies did that. many were consumer product companies and staples. they're the ones who have been suffering recently. you know, unit demand, i think, is one of the stories that will emerge because as soon as we have lower interest rates, demand for housing is going to improve. you know, there's a huge multiplier effect for ggdp. a huge cyclical part of the economy will pick up. >> tom, do you forecast at this

point there will be disappointment from the fed rate cuts next year and will that be okay if we don't get whatever it is that the markets anticipate? six or seven? is that okay? if we do get it, what does that say about the economy? >> i know that's the debate, joe, with investors, and to me the number of cuts isn't going to be as important as how the bond reacts to trading inflation this year. we think inflation is still on a glide path much lower than incentive. i think we'll approach target before year end, 2024. maybe december 1 could be a little bumpier than expected. it's going to be less about how many cuts the fed does and it's

going to be whether or not the fed also recognizes that. >> you don't think the last mile is going to be an issue with -- because of wage gains or whatever. you think we'll get to -- the fed will get to 2%. people said we'll never get to 2% again? you think it's the new normal. do you think we go back to where we were after such a long period of time? there's nothing structural in there? it was always supply chain issues. >> the best clue is we got consumer expectations from the fed survey earlier this week and they're back to prepandemic. so if consumers aren't expecting inflation to reaccelerate and housing and cars, which is essentially been 86% of the change in inflation, if those are normalizing and housing double have to be negative, it just has to grow at 3%, as you

know, used cars could fall as much as 30% in the next 12 months. you don't really have much behind inflation. so i'd be surprised. >> so it was transitory. >> yeah. >> yeah? that's what you're aying. it was transitory all along. it was, it wasn't, it is, it isn't, now we've decided we're back to that. so to end on -- give me your one-year and five-year price target for bitcoin. >> i think in the next 12 months something over 100,000. you know, maybe over 150,000. you know, in the next five years, again, it's, you know, there's a finite supply, but now we have a potentially huge increase in demand with a spot bitcoin approval. so i think in five years, something around half a 's all

tom. you've got enough credibility with all of your calls to where at least i would think some skeptics would start thinking about it. does it make you think about it, andrew? >> sure. my question, tom, is do you think this is going to upend the idea that people will buy bitcoin directly? meaning people who historically would have wanted to buy bitcoin, do they continue to buy through coinbase or some other platform or exchange or do you think it basically becomes not a speculation, but just an investment through etfs, and that's how this all works? >> i think there's probably a generational divide at work. you know, i think that a lots of the younger generation investors want to be my keys, my coin, so they want to own the private keys, but as you know, there's a generation of folks that would

rather allocate through their 401(k) or through public markets and liquid assets. you know, if you look at the percentage of assets held by those over age 50, it's close to 76% over all wealth in america. it's over $120 trillion, so i think that cohort is still going to prefer to own it through public markets and proxies. >> all right, tom. i mean i'm going to pay blackrock's fee. they'll plant some trees for me for all the bitcoin or do something, won't they, tom? i think blackrock will figure some way of offsetting -- >> some kind of an offset. >> what about fidelity? >> i'm not allowed to say those words anymore it says in the "journal" today that i can't. all right, tom lee, thank you. we'll see you later. still to come this morning, the battle in washington over retirement advice. sharon epperson has that story

next. and later, much more in the drama on cryptocurrencies. we'll talk with sejoph lubin, the co-founder of ethereum. "squawk box" will be right back.

icy hot. ice works fast. ♪♪ heat makes it last. feel the power of contrast therapy. ♪♪ so you can rise from pain. icy hot. the first time you made a sale online with godaddy was also the first time

you heard of a town named dinosaur, colorado. we just got an order from dinosaur, colorado. start an easy to build, powerful website for free with a partner that always puts you first. start for free at godaddy.com

a battle is underway in washington over raising protections for requirement advice. senior correspondent sharon epperson joins us. she has a look on what 401(k) participants should expect. >> typically i when you leave a company, you have a few options for what you can do with your 401(k) money depending on what your plan will allow.

you can keep the plan, roll it over into an ira, or buy an annuity. they want to acquire advice. it's ensuring the advice is in the client's best interest. she says fiduciaries look at the entire financial picture. >> we actually will take a look at all of their investments as well as the financial planning aspect of it and we actually -- since we're fee-only, we're not charging any commission or seeing any commission. >> others argue requiring a fiduciary standard will restrict advice for millions of americans who get help with retirement planning, life insurance, and annuities and professionals who rely on commission-based sales. >> for so many americans, they can't receive access on financial advise from a fiduciary-only standard because

the fiduciaries typically speaking only represent people with a minimum amount of investable assets. >> house lawmakers will weigh in on it in a hearing on capitol hill and final rules from the labor market are not expected until thissummer, becky. >> the battle is over whether these commission-based -- they're saying, wait, we're doing it cheaper, but there's still a fee. >> there's so much as stake. 5 million people every year are rolling over their 401(k) money into a roth i.r.a. everyone who wants a piece of this money to give some advice on what to do. there are a lot of folks working in industry who never had a fiduciary standard. they're now going to have to find out if it is required, what's the costs to them to doing so. >> if you're doing an assets under management of 50 basis

points, you need a $500,000s to give the person a service. if you were to collect $2,000 i.r.a.s with clients with $10,000, you can't afford to do that for 50 basis points and give them the individual service they need. >> many wealth managers say that, but there are fee-only financial advisers that will offer advice for -- by the hour. they'll do it for a small amount of money. >> with no commission. >> with no commission. >> i do it from ads from a particular firm that says we're not like any other broker because we're fiduciaries. i was under the impression everybody needed to have their client's best interest across the board. >> i think a lot of people think that, but i think what people need to do is ask that question. are you a fiduciary just so the professional knows that you know you want them to be giving you advice that's in your best interest. if you don't ask -- >> if you don't ask for it, you don't get it? >> you don't. you have to ask how you're

compensated. what are my options, what is the fee, and what is the compensation you get? >> has a financial adviser ever said, oh, no, no, no i'm doing things in my best interest. >> they should tell you if they're getting a commission on something. >> selling their product versus another or their own mutual funds. >> if you don't have money to pay a fee, you should not be saying, okay, you can take a commission cut off of my entire nest egg i've been saving my entire life. >> it's the biggest financial position. this is all of your retirement money, you want to make sure the person giving you that advice is looking out for you but has that fit into your entire financial life, not that i want to sell you this product. >> sharon, thank you. sure. coming up on the other side of this, the optimistic tone appears to be fading, this as a doubt as to whether they'll

reach it before the deadline. as we head to the break, a look at yesterday's s&p 500 winners and losers as we also look at the beautiful shot of the capitol. - i got the cabin for three days. it's gonna be sweet! what? i'm 12 hours short. - have a fun weekend. - ♪ unnecessary action hero! unnecessary. ♪ - was that necessary? - no. neither is a blown weekend. with paycom, employees do their own payroll so you can fix problems before they become problems. - hmm! get paycom and make the unnecessary, unnecessary. - see you down the line.

good morning and welcome back to "squawk box" live at nasdaq times square. there are the futures. pretty quiet this morning. nasdaq up a little. the world economic forum just out with its global risks report for 2024 says election disruption from artificial intelligence poses the biggest global risk. it cites a busy year for global elections including the weekend vote for taiwan and upcoming elections in the u.s., india,afo and global leaders are expect to meet next week in davos, switz switzerland. literally global leaders and "squawk box" leaders will be there too. we'll bring you full coverage of the summit starting tuesday at

6:00 a.m. eastern. meantime republican lead negotiators on the funding deal. james lankford is not as optimistic as he was earlier in the week. the senator now says he does not expect to have a deal announcement. joining us to talk about it, heidi heitkamp, former u.s. senator and director of the chicago institute of politics. do you agree? i don't understand why he was optimistic beforehand. >> what would it look like if you were doing negotiations and said, none of this is going to happen, we're just fooling around here. >> that's what they were doing, they were fooling around. >> i don't think they were fooling around. i think this is all about the leverage of what's going to happen with the supplemental for israel, for iraq, and then border security. >> okay. so handicap it. i assume you're not optimistic. >> i eemg not optimistic. i think every time you dip your toe into anti-immigration or border politics, you're being

burned. now that they've been linked to two significant -- not that border issues aren't significant -- but linked to two important issues like ukraine and israel, that leverage was a reason for being optimistic. >> walk through the fault line as you see it inside the democratic party over immigration and border control. what do you think they would be able to agree with and do beyond what they said they'd do already? >> i think if you went back and looked at the massive immigration reform package that we passed actually in the late 2000 -- i guess 2016 that we passed immigration reform before the election, i mean that was almost 70 votes, andrew, and it was a lot of compromise, and there were a lot of people on both sides unhappy with that package. it passed, but then we couldn't get any action in the house. and so there are -- this is not new issues. whether it's what people call

chain -- >> you led the house. didn't you lead the house then? >> no. paul ryan controlled the house >> i thought obama was not going to sign that, either, at some point. both parties tend to drop the ball on this, don't you think? >> think about it. we've got how many millions of people in the country? we need workers. >> not this -- we've got 85% release rates on the millions of people that are coming across right now. >> yeah, but, you know, when you look at the statistics, the vast majority of the people in this country who are here illegally now, not counting what's happening at the border, overstay their visas. they're not coming across the border. they're coming on an airplane with a visa and they're staying. >> this is explodable, this whole issue, and democrats have noticed it. >> i think there are bigger issues. i think there's a bigger issue of people overstaying their welcome on the visa front. that's a much smaller issue than

what's happening at the border. >> this is the reality, that the democratic party should be looking at what is the mood of the people in this country as it relates to what's going on at the border and say, look, we have to be realistic about securing the border. >> what does that mean? >> number one, i oppose the wall. i thought that was a colossal waste of money. there's tons of things we can do, strategies that border patrol will tell you works in terms of apprehension. we have to have a better system of controlling applications for asylum, and that's the big issue. what's the issue when it comes to policy from white house. if you feel you get here, get asylum, get sent to a major city in the northeast and if you feel like oh eventually you're going to be forgiven, that changes

things. right now people are coming across. people on the waiting lists are waiting forever and we're not taking them because we're taking others. >> they're in some ways going through a legal process because because they're -- >> i know the people on the waiting list has gotten way, way longer because we're not policing the border properly and not policing policies that say if you come here the right way, it's going to be expedited. if you don't, you're going back. >> the big thing we need to do is change the asylum laws that we have, whether there's an application for asylum. >> do you see any appetite among your party to do that. >> to change the asylum laws, really? >> i think that's going to be a realistic discussion. there's a reason why you have people like john fetterman saying this needs to get fixed. people like john tester are saying, this needs to get fixed.

it's not adjust because of politics. it's because what we're doing right now is not working. >> it's amazing those are the only two you can come up with. >> that's not true. that's not true. >> fetterman is suddenly -- people who used to roll their eyes is saying this guy is a substantive person as opposed to the rest of his party. he's like living in the real world. >> i mean i think that's a big generalization. >> i don't know. you came up with tester and -- tester and fetterman. where's warner? where's durbin? where's biden? where's his people in this administration? this is turning into the democrats' abortion issue. if they don't figure this out, they're going to start losing elections just based on border policy. >> yeah, this has been a big problem for democrats for a long time, and i think there has always been this sense that if we're going to do immigration reform and border security, that they have to hold hands and we have to do them at the same

time. >> democratic mayors are like, help us, help us, we don't have enough hotels to displace people. >> i do -- i do say this. i think it's so interesting all the mayors complaining about the influx of migrants. >> in the sanctuary system? >> no, no. and they expect texas to take it all. so it's like, oh, well, we can't handle 20,000 -- >> there 's the battle, keep thm there, don't bring them here. >> i agree with you. >> i can't believe i'm saying this because i think it's sort of abhor rent to send people on buses and to place them around the country. it's working. >> okay, joe, here's where our political argument is. we spent four years arguing about building a wall, which was not what was needed to be talked about. we needed to talk about what kind of workers we. >> ed in this country. >> we may go back to building a

wall, heidi. >> you think a wall's go ing to work, joe. >> you're building an electronic wall. build me kd soinof wall. you're just dealing in semantics there. switch to shopify and sell smarter at every stage of your business. take full control of your brand with your own custom store. scale faster with tools that let you manage every sale from every channel. and sell more with the best converting checkout on the planet. a lot more. take your business to the next stage when you switch to shopify. moving forward with node- positive breast cancer is overwhelming. but i never just found my way; i made it. and did all i could to prevent recurrence.

verzenio reduces the risk of recurrence of hr-positive, her2-negative, node-positive, early breast cancer with a high chance of returning, as determined by your doctor when added to hormone therapy. hormone therapy works outside the cell... while verzenio works inside to help stop the growth of cancer cells. diarrhea is common, may be severe, or cause dehydration or infection. at the first sign, call your doctor, start an antidiarrheal, and drink fluids. before taking verzenio, tell your doctor about any fever, chills, or other signs of infection. verzenio may cause low white blood cell counts, which may cause serious infection that can lead to death. life-threatening lung inflammation can occur. tell your doctor about any new or worsening trouble breathing, cough, or chest pain. serious liver problems can happen. symptoms include fatigue, appetite loss, stomach pain, and bleeding or bruising. blood clots that can lead to death have occurred. tell your doctor if you have pain or swelling in your arms or legs, shortness of breath, chest pain, and rapid breathing or heart rate, or if you are nursing, pregnant, or plan to be. i'm making my own way forward. ask your doctor about everyday verzenio.

time now for the executive edge. blackrock is laying off 3% of

its work force. lair fink and the president says the company is capito. the company's reallocating resources amid rapid changes in management. among the changes they say etfs are the preferred vehicle for index and active investsment strategies. they also cited growth overseas particularly in europe and asia. they expect to post quarterly resulted on friday. and -- and further more, amazon's live streaming site twitch is planning to cut 35%, 35% of its staff. that's about 500 workers. this is a bloomberg report that said the cuts could be announced as soon as today. the report says twitch remains unprofitable despite a recent focus to bring in ad revenue.

twitch already cut 400 positions in the last year. coming up, houthi militants launching their biggest attack today on merchant vessels in the red sea. we'll speak with rireted admiral james stavridis. that's next. fln. >> announcer: executive edge is sponsored by at it in business. next-level moments need the next-level network. of aruba? huh. this listing is misleading. well, when at&t says we give businesses get our best deal, on the iphone 15 pro made with titanium. we mean it. amazing. all my agents want it. says here...“inviting pool”. come on over! too inviting. only at&t gives businesses our best deals on any iphone. get iphone 15 pro on us. (♪♪) power e*trade's award-winning trading app makes trading easier. with its customizable options chain, easy-to-use tools and paper

trading to help sharpen your skills, you can stay on top of the market from wherever you are. e*trade from morgan stanley. fresh, warm hot dogs! when i'm not selling hot dogs, i invest in a fund that advances innovations like robotics. fresh, warm hot dogs, straight out of my torso! one for you, one for you. oh, you're a messy one. cool, right? so cool. anyone can become an agent of innovation with invesco qqq, a fund that gives you access to nasdaq-100 innovations. hot dogs! fresh, warm hot dogs! before investing carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com. that first time you take a step back. i made that. with your very own online store. i sold that. and you can manage it all in one place. i built this. and it was easy, with a partner that puts you first. godaddy. trading at schwab is now powered by ameritrade, unlocking the power of thinkorswim, the award-winning trading platforms.

bring your trades into focus on thinkorswim desktop with robust charting and analysis tools, including over 400 technical studies. tailor the platforms to your unique needs with nearly endless customization. and track market trends with up-to-the-minute news and insights. trade brilliantly with schwab.

welcome back, everybody. the u.s. navy telling cnbc that houthi militants launched their biggest attack yet.

for more on this, we want to bring many james stavridis, former nato supreme allied commander, now carlisle group's global affairs vice chair and nbc news chief international analyst. and, admiral, thank you for being with us this morning. this does sound like things have stepped up pretty significantly. you're talking about more than 20 missiles and drones that were launched and taken out by the u.s. navy. how would you characterize what's happened here? >> well, this is complex attack. it is indeed a step up, becky, over what you and i talked about a couple of weeks ago. it was an attack on not only the u.s. navy, but also our coalition partners, the british destroyer was operating with us, her majesty ship diamond. and above all, and you're showing it right now, it is an attack on commercial shipping. there were dozens of commercial ships in the vicinity of this complex attack. and i really underline that word complex. look at the video you're

showing. these are very capable war fighters. this is a takedown of a ship called the galaxy, which is being held hostage today in a red seaport. this is very sophisticated activity. it is going to require frankly more than just defensive responses going forward. >> and admiral, we talked about this in the past, you were there for the pirates that were coming from somalia and were able to shut that down, but this is different. these are war, weaponized, these are more trained, and you believe very clearly backed by iran, these attacks that are coming. you think a much bigger step is going to have to take place and that includes attacks on land. >> unfortunately so. i think some folks will remember that the movie with tom hanks, captain philips, those were

somali pirates in flip-flops with ak-47s, some speedboats. this is not your daddy's pirates. these are state-sponsored by iran. they have access to all the equipment, the training, the organization. they have been at war with the kingdom of saudi arabia and the uae for over ten years. they control half of yemen, particularly that red sea coastline. so, simply putting a few destroyers out there and fighter jets, which are all good and capable and we should be doing that, i just don't think at least thus far the houthi pirates and their masters in tehran are getting the message. so this is going to be a week of decision, i think, for the white house as to whether to go ashore. ultimately, becky, to close. we had to go ashore to go after the pirate camps. i think we're going to have to do something along those lines now. >> we're almost out of time,

admiral. the risk of the war in the middle east expanding if we do that? >> it brings us to not just houthis, but hamas and hezbollah, with those three terrorist organizations have in common besides beginning with the letter "h," they're all funded, sponsored, and directed by iran. so, yes, this also increases the potential for a wider war up to the 25% range, iou wld say. that is dangerous. >> wow. admiral, thank you, very much for your time this morning. >> you bet. >> "squawk box" will be right back. [♪♪] your skin is ever-changing, take care of it with gold bond's healing formulations of 7 moisturizers and 3 vitamins. for all your skins, gold bond.

she runs and plays like a puppy again. his #2s are perfect! he's a brand new dog, all in less than a year. when people switch their dog's food from kibble to the farmer's dog, they often say that it feels like magic. but there's no magic involved. (dog bark) it's simply fresh meat and vegetables, with all the nutrients dogs need— instead of dried pellets. just food made for the health of dogs. delivered in packs portioned for your dog. it's amazing what real food can do. when you think of investment risk, do you consider climate risk? changing weather patterns are impacting the way we live and the value of businesses large and small. this can mean disruption to supply chains, changing demand for products and shifting regulation. what does this mean for your business, your clients, and your investments? ice offers data and markets that can provide critical insight. manage your climate risk with ice.

good morning. bitcoin skyrocketing after a hacked s.e.c. social media account falsely posted that bitcoin etf had been approved. we'll hear from a former s.e.c. attorney. boeing's ceo telling workers, every detail matters in response to the incident last week that grounded the company's 737 max 9 planes. the latest on the investigation is coming up. and dealing with anti-semitism on campus. frank luntz posts the question to students at some of america's

most prestigious schools. he joins us with their responses. the second hour of "squawk box" begins right now. good morning and welcome back to "squawk box" right here on cnbc. we're live at the nasdaq market site in times square. i'm andrew ross sorkin with becky quick and joe kernen. a lot to talk about this morning including bitcoin and maybe one day talking about bitcoin futures and everything else. right now, dow up about 56 points. nasdaq up about 20. s&p 500 off about 2. treasuries right about now, looking at the ten-year note at about 4, flat, two-year note at 4.38% and then oil, wti crude, take a look at if you want to buy it by the barrel, $72.48 this morning. let's talk bitcoin. >> all right. this may sound very familiar to

viewers if you were watching earlier. we're watching the price of bitcoin after the s.e.c. said that a post on x that said bitcoin's etf had been approved was the result of a hacked account. s.e.c. chair gary gensler posted an update saying the s.e.c. twitter account was in fact compromised and an unauthorized tweet was posted. the s.e.c. has not approved the listing and trading of spot bitcoin exchange traded products. the official at safety account from x later posted it completed a preliminary investigation and it found that the compromise was not due to a breach of x's systems, it says the unauthorized user gained access by obtaining control over a phone number associated with the s.e.c.'s account and it also said the account did not have two-factor authentication enabled. the market expects the regulator at some point to green light spot bitcoin etf as possibly as

soon as today. we're going to speak to a former s.e.c. enforcement attorney about the situation in just a bit. >> and consumer spending finished 2023 on a positive note. total card spending for household increased by 0.2% year over year in december. the survey also shows that high income household wages growth dipped and lower income saw some growth according to bank of america's consumer checkpoint report. the winter spending survey suggests that consumers will likely start pulling back their spending on meals and other experiences this year. for more on this, we want to bring in liz everett chrisburg, from bank of america institute. 2023 was the year that outdid all the expectations when it came to the consumer strength. what do you think 2024 is shaping up to look like. >> i think before we get to 2024, december they announced the word of the year for 2023 was riz and we think they got

first syllable right but it was resilience. the data in december as you walked through really underscored that. there are things that, you know, that we're looking at, that give us some pause and one of them is what you were talking about as it relates to wages. in order to understand spending, you have to understand what is going on in the income side. and while income growth is still growing overall, and still growing in particular for lower and middle income households, higher income households saw their income growth dip just a little bit, .1%. but there is some caution. and when you ask the consumer as we did in the bank of america winter spending survey, almost 60%, 59% of people are saying they're going to need to cut back on their spending in order to achieve their goals. now, before the alarms go off, recognize that last year 54% of -- >> i was going to say, isn't this the hangover effect that everybody feels after they just spent a whole lot of money on the holidays and -- >> it is not the -- it is not

necessarily they spent a whole lot of money on the holidays, the survey was right before that, but interestingly in the holidays, we started the season really early and really strong, you know, in november, we were up .9% when overall spending was up half a percent. but that, it is like when you run a marathon and start out really strong and then, yeah, don't finish, right? in december, holiday spending was down 1.5%. >> i was going to ask you about credit. i was looking at sheila baird on x in last day, she had consumer credit exploding to over $5 trillion in november while revolving credit near $1.3 trillion, we obsess over gdp, unemployment, labor participation as predictors of recession, but rising consumer debt levels have portended economic downturns. >> i think we didn't look at that. i got to go back and look at the numbers for the end of the year. but i think, again, overall the

consumer is seeing the numbers are ticking up, but not at a level we're quite concerned about yet. i think the key thing we ought to be focusing on is the wages and that's where i have a little bit of a concern with the higher income households up a little bit. >> higher income households aren't spending all of their money anyway. it is probably better news for the economy if lower and middle income people are still seeing wage increases that are coming through. >> absolutely and they are. in fact, the lower income household wage growth ticked up a little bit. but that is a concern. one of the pushbacks we also get is that higher income households have, you know, consumed more. the top two quinn tiles consumed 65% of consumer spending. the reality is everybody needs to be spending, right? and we are continuing to see growth. so we are still seeing spending growth. it is moderating, but so i don't know that we're going to have the same exhilaration we had in 2023. but i don't think that we're

turning back yet. people are still spending. one other thing i would caution on is if we look at what people are spending on, it continues to be a services story. so services spending growth up 2.5%, goods down 1.6%, some of that was gas. but, when we -- when you think about that, some of that is because of inflation, right? and inflation is important. and even though people are saying they're going to cut back on dining out, on travel and what not, on events, you may still see services spending increase because of the nondiscretionary services. think about utilities, think about insurance, think about child care, so, you got to look underneath the numbers as opposed to that headline within services. >> the story for at least 2 1/2 years now has been that the consumer is going to run out of excess cash and i think last year at this time i remember talking to bankers who said, it will definitely happen over the summer of 2023. still hasn't happened really. >> still hasn't happened.

>> is that -- is this the new paradigm, the new normal? >> it still hasn't happened. and, you know, i think the other thing you have to think about is when people are looking at that excess cash, sometimes they may just be looking at deposit balances. but the realities you got to look at all of what a consumer has and when you -- >> including credit card debt. >> you have to look at their investments. >> okay. >> right? and where is the market, right? relative to a year ago, people who are invested have that cushion. >> you still sound pretty optimistic, though, about the consumer and the health of the economy. >> i'm more cautious than i was, right? but growth rate has moderated. but it is moderated. and it is staying relatively stable at this point. we're not seeing over the last three months those levels as it relates to spending, as it relates to wage growth or wage decline as it relates to high income, they're relatively stable. so, i, you know, i'm not -- i'm not throwing a new year's eve party, but i'm certainly --

>> were you guys doing this before the great financial crisis? i feel like the institute is more recent than that. >> we launched in april of '22. we weren't looking at it before the financial crisis. >> do you have data that you go back and look at that from that? >> we can't go back quite that far. we obviously go back before the pandemic, and look at that, we need to get all that data lined up and then we can potentially go back and look at that and see how that would relate to -- >> the other day, the story that many, many, many retirees are totally dependent on social security, that's all they have. that's all they have. >> yeah. >> inflation goes up. and that means when they go to the grocery store, they have to put this back, or that back, or in terms of rent or in terms of -- that is a -- i don't know what we do about this. what can we do about this? >> you raise an interesting point. if we look at spending patterns throughout last year, we saw older consumers have much more higher spending growth than

younger consumers. i think a lot of that had to do with last year, the 2023 cola increase, the increase of 8.7%, well above what inflation was. the issue now for 2024 is that cola increase is much lower, much closer to what inflation actually is, 3.2% i think. but remember that it is still an increase. you are still seeing older generations, boomers, their income, which would include social security, right? it is still going up, but it is not going up the way that it was last year, so, if you think about that older generations driving the spending growth, that will probably not -- >> there is one out of five, but that's still -- that's a sad way to live out your last years. >> certainly. certainly. >> liz, thank you for the insights. we appreciate these updates. >> always great to be here. coming up, the ntsb is

focusing on boeing and spirit aerosystems assembly work after last week's inflight incident. we're going to hear from a former ntsb investigator. and then later, the s.e.c. acknowledging that its x account had been compromised after a post that announced bitcoin etfs were approved for trading. reaction from a former s.e.c. attorney. we're coming right back. but what if you. (tense music) stop! you work hard. it's time for a bank that'll work hard for you. everbank performance savings is built to put your money to work with some of the highest rates in the country. going, that's what got you where you want to be. we're the partners for your next move. everbank. advantage, you.

[♪♪] your skin is ever-changing, take care of it with gold bond's healing formulations of 7 moisturizers and 3 vitamins. for all your skins, gold bond.

♪ ♪ formulations of 7 moisturizers and 3 ♪ ♪amins. ♪ ♪

now for the latest on the investigation into alaska airlines, it was flight 1282 and the subsequent grounding of some boeing 737 max 9 planes. let's bring in former ntsb investigator greg fefe. thank god it is not going to be a number stuck in our brain, there are some from the past that we do remember the numbers and it could have been, and i don't understand why we get to the point where we change protocol on something that seems like it was kind of obvious. maybe it is just hindsight in 2020, but it seems like you could have checked this stuff out better. >> joe, that's one of the big issues with boeing recently, with all of their quality control issues, here is another black eye against the 737 max

aircraft. and given the fact that the lessons that we learned from the mcas events, the scrutiny that the 737 has been under, the spotlight that boeing has been under, you would think that this would be an airplane that has zero issues and unfortunately they keep coming back with the rudder event a couple of months ago, some elevator rivet issues and engine calling issues, you would think that the quality control, they would have reset, boeing would have reset their safety protocols, if you will, and really enhanced their quality control checks. >> i wonder how many different parts of the plane that you could group into things that needed to be checked. the mcas, i characterize that as, like, almost a software or a procedural checklist that you do. how many of things like this are we talking about? you talk about the fuselage and

the integrity of that. you mentioned the rudders. so there is bolts on the elevators, there -- are there still cables? remember when we had a problem with a piece went into the cable? they don't have those anymore, do they? >> well, some of the older, even though this is a variant, there are cables still in the airplane. some are totally electronic. but the fact is that with all of the moving parts on an aircraft, yes, they'remagnificent machines and the workmanship and the craftsmanship and engineering that goes into them are fantastic. these are the little things. these are the human things where you have humans interacting with a machine, and, of course, any kind of human interaction, you always are setting yourself up for these types of things. that is the quality control issues. somebody has to turn that bolt, torque that bolt, make sure there is a coder pin behind that

nut. when you look at all these things, these small things can cause catastrophic events. and in this case, we're fortunate the plane was only at 16,000 feet. we would have had a different scenario had this plane been at 35,000 feet. >> and when the worse case scenario does play out, a lot of times we look back and we find similar things. in this case, it didn't, but there will be a next time. and we know that. i'm wondering, if you were running boeing, if you are dave calhoun, how would you -- how do you go down the line of command to make sure that people are doing things like that? and i guess you have to -- there would be man hours spent or worker hours spent -- i'm so pc now, i can't say man hours, there would be worker hours spent and that adds to -- hurts margins, the more inspecting and safety, more time you spend on that and you have your employees spending on that the less money

you make, so that the whole profit incentive comes into play. >> yeah, well, you can pay me now or pay me later. because i would rather spend the money now on safety than have to pay for an accident. and unfortunately boeing has learned some very hard lessons with lion air and ethiopia. so the fact is if i was running the company, i would put together a team, an advisory team, consisting of ex-boeing employees, people who have been down on the floor, whether they're supervisors or actually technicians who build the aircraft, you need to have people on the ground who are listening to try and understand what are the issues, what are the problems that are going on, on the manufacturing floor. that information has to filter up to the c suite and they have to act on it. given the fact that now the headquarters is well displaced from where they actually manufacture the aircraft, who knows where the braeaks in

command are and the chain of communication. that's the huge issue. and they lost a lot of talent from boeing, whether it is downsizing or programs have terminated. look, the 747 program is over. so where is all that talent, all that experience? did they reassign those folks or do those people get rift out, reduction in workforce. i would put in an advisory team together to have communication, direct line communication, all the way to the top. look, this is a problem that has been ongoing. this is not a one off. and they should have learned lessons by now. and then, of course, where are the shareholders? why are they not really pushing top management to really understand what is going on. >> yelling at the board for being, you know, sort of, i don't know, in, you know, we hear about boards all the time, sometimes they just, whatever the ceo says, they just nod and i don't know. he was on the board. >> yes. >> trying to figure out what you need to do to inspect every bolt

on -- on a -- then i'm thinking, you would like do it on a 30 -- like to focus on the planes that have been in service for -- if you got to inspect every bolt on a 3-month-old plane, how long does that ake? and then you know what you do? you inspect the bolts on most recent thing that happened. okay, let's look at these bolts on the plug for the fuselage, and the next thing is going to be somewhere else. you got to do the whole plane. >> well, i mean, that is part of the build process. they have come up with a process for manufacturing that aircraft and, yes, every bolt is inspected. now, some are what is called rii, which is a required inspection item. that requires additional inspections. others, once they're in place, once they're installed, it is really install and forget. and that unfortunately is what has happened with this door plug because of the construction and, of course, the assembly

procedure for these bolts. if they are installed correctly, you won't have this issue. that's why i think through the inspection, once the bolts are inspected, it is going to be, yes, the faa is probably going to require repetitive inspection just to confirm everything has been done. but the entire airplane is inspected, joe. >> yeah, you needed to do this -- that's why the quality control is so paramount on the construction, the initial construction of the plane, which is what is troubling because those three months, it only has been in service for three months. so -- >> but, again, you got a new airplane like a new car. once it gets into service, things are going to happen during in service -- >> you ever have a lemon? i had a lemon. it is amazing. it is like you have a lemon that, like, you can't even believe it. and then you get a different one and, i don't know -- the assembly line had a bad day or

something. >> the question, was this a lemon, was this a -- >> was it a lemon after the mcas, the rudders, the this -- you mentioned about six different things and it is not a lemon. it is the greatest plane in the air, isn't it? >> it is. and, of course, you know, other manufacturers do have their own inherent issues as well. so, but, again, this has been unfortunately back-to-back issues with now this door plug, of course the engine issue and the rudder. they're too close together. and the question is, with the scrutiny that boeing is under, because of this particular airplane, why are they still having these quality control issues? and a lot of it, if you remember back years ago, when boeing went on strike and they had management building airplanes, we had a lot of problems with their airplanes. so, again, it has to be a shutdown to an extent of regrouping, but they need to have a very good line of communication of what's going on

the floor, and the talent that is there. >> and, shouldn't forget, 50,000 takeoffs and landings a day, just in this country. it is unbelievably great how everything works across the board. >> no problem getting on an airplane tomorrow. >> okay, greg. thank you. programming note, phil lebeau will have an exclusive interview with boeing ceo dave calhoun at 1:00 p.m. eastern time. coming up, a read on the mortgage market and then the s.e.c.'s bitcoin debacle, a false tweet on the agency's x accounts, sending bitcoin skyrocketing. we'll find out whether it is going to skyrocket again if and when the s.e.c. does announce an approval. we're coming right back after this. >> announcer: time now for today's aflac trivia question. rg this day in 2000, what mega meer was completed in a deal worth $182 billion in stock and debt? the answer when "squawk box" returns. gaaaap! did this goat just say 'gap'? he's talking about expenses health insurance

doesn't cover. but with aflac, you can get money to help close that gap. aflac, huh? -aflac! -ahhhh! okay! oh! duck - 1, goat - 0. get help with expenses health insurance doesn't cover at aflac.com -you want to race? -for real? (grunting) at morgan stanley, old school hard work meets bold new thinking. (laughter) at 88 years old, we still see the world with the wonder of new eyes, helping you discover untapped possibilities and relentlessly working with you to make them real. old school grit. new world ideas. morgan stanley.

>> announcer: and now the answer to today's aflac trivia question. on this day in 2000, what mega merger was completed in a deal worth $182 billion in stock and debt? the answer, aol-time warner.

welcome back, everybody. mortgage applications released earlier this hour. diana olick joins us now with more. good morning, diana. >> good morning, becky. mortgage demand came roaring back last week with total application volume up nearly 10% from the previous week. and that is seasonally adjusted with an additional adjustment by the mortgage bankers association for the new year's holiday. now, this happened even as the average rate on the 30-year fixed for conforming loans increased to 6.81% from 6.76% for loans with a 20% down payment. that rate peaked at around 8% in october, and was in the 7% range for much of last year. applications to refinance a home loan jumped 19% from the previous week and were 30% higher than the same week one year ago. the rate is still 39 basis points higher than it was a year ago, but it is 26 basis points lower than it was four weeks ago. while there are a lot of borrowers who can benefit from a refinance given how low rates

were two years ago, those who can are clearly getting back into the market. now, applications for a mortgage to buy a home rose 6% for the week, but we're still 16% lower than the same week one year ago. i have been hearing from agents, heard from one last weekend, they saw much more traffic at open houses last weekend. of course, there is still very low supply, but agents also say they expect to see more coming on the market in the next few weeks with lower rates. we could see an early start to the spring season, buyers may try to get in before the competition gets even worse and take advantage of the low rates. back to you. >> diana, i can't say i'm surprised by most of that news because, look, you would expect with prices coming down, people are on the lookout, especially as you get through the holidays and time to start looking. i think what surprises me most is the idea that mortgage refinance applications jumped so much because i just didn't think there were that many people who needed to. are these people who may be in the last six months signed up and couldn't get a better rate and you finance as soon as they

come down or think they would hold -- >> actually, yeah, i think unfortunately i'm going to be boring and say it is a little bit about math. we say there are big jumps in refinance applications, but we're coming off this incredibly small number. so there are still very, very, very few people who can benefit, but because there are some, they're getting in and these are people who may have refinanced, who may have bought their homes in the last year, in the last two years when rates were in the 7% range. generally you want to get 50 basis points lower to make a refinance worth it. there are some people out there, maybe there are some people who didn't qualify earlier for a refinance and now in a better economic situation. but, again, it is this very, very low number, so any bump up is going to seem like a big bump up. >> that makes sense. diana, thank you. coming up, former s.e.c. attorney on the s.e.c.'s x licaoin debacle and then potil strategist frank luntz will join us to share his perspective on how to address

anti-semitism on college campuses. "squawk box" will be right back. the new york stock exchange is a symbol of what america is all about the potential of an american dream. it is day one. a lot of work has happened to lead to this historic moment. the only way you can move a society forward is a true expression of freedom. ♪♪ after last month's massive solar flare added a 25th hour to the day, businesses are wondering "what should we do with it?" bacon and eggs 25/7. you're darn right. solar stocks are up 20% with the additional hour in the day. [ clocks ticking ] i'm ruined. with the extra hour i'm thinking companywide power nap. let's put it to a vote. [ all snoring ] this is going to wreak havoc on overtime approvals. anything can change the world of work. from hr to payroll, adp designs forward-thinking solutions to take on the next anything. [♪♪]

your skin is ever-changing, take care of it with gold bond's healing formulations of 7 moisturizers and 3 vitamins. for all your skins, gold bond. hi, i'm darlene and i lost 40 pounds with golo formulations of 7 moisturizers and 3 vitamins. in just eight months. golo has really taught me how to eat better and feel better. as long as you eat the right food groups in the right amounts, that's all it is. it's so simple and it works. golo was the smartest thing i ever did.

black rock lowering the fee on its proposed spot bitcoin

exchange traded fund to 0.25% from 0.3%. it also lowered its introductory offer on .fund, so investors will pay a fee of 0.12% for the first 12 months or the first $5 billion in assets. cathie woods' ark cutting its fee. the s.e.c. meantime says an announcement about bitcoin exchange traded funds yesterday afternoon on its x file on its x account was false. in a statement to cnbc, the agency says it is determined that there was unauthorized access to and activity on the at s.e.c. gov x account. joining us for more on this is rebecca fike, an enforcement attorney, a partner at vincent and elkins. and, rebecca, this is

embarrassing to say the very least. >> i think that's exactly right. thank you so much for having me this morning, becky. >> so, what happens? if another company did this, the s.e.c., i think, would be all over it. investigating trying to find out what happens. who investigates the s.e.c.? >> that's a great question. you're exactly right. if this was any public company, the s.e.c. would be immediately opening an investigation. they would be calling the company's general counsel, they would be letting them know to retain documents and evidence and asking a lot of questions about how this could happen. with the s.e.c., i think you're looking at congress. i imagine will have questions. the doj, i imagine, will be involved, likely looking more at the potential hacker rather than looking at the s.e.c. itself. and since bitcoin is a commodity, the cftc could also be involved. >> i mean what is so concerning

about this is this is the agency that is responsible for policing the markets, making sure there is not this way to manipulate and make or lose money, make other people lose money on this. with the turn of events, somebody pointed out, this is very clear, this announcement came out, this fake announcement, it wiped out people who used options to short bitcoin. the s.e.c. immediately retracts it and said this was a false tweet that had gone out. and then everybody who had used options to go long on bitcoin loses money too. what happens? >> i mean, it was a market moving event. it really underscores how important cybersecurity is, which is one of the things the s.e.c. and chair gensler have been speaking about so much. it also underscores how complicated cybersecurity is and how hard it is to react in a crisis and how even i think it was 15 minutes that they believe the hacker had access to the account, and those 15 minutes,

approximately $90 million of long and short positions were liquidated on bitcoin. it is just -- it is an incredibly important area and the s.e.c., i think, got a direct lesson in how challenging an area it is. >> in this case, it does not sound like it was x's fault in any way, shape or form. they said it was in their investigation it wasn't anybody at x or anyone who had access to x's accounts. and that the s.e.c. hadn't even bothered to use the dual factor authentication in this. but, i do have questions about how you can manipulate markets on any social media. you think about it, there is fake accounts. we have fake accounts for all of us that circulate around. if something were posted on that, and the market moved on some of that news, who would be responsible? >> it would depend, the classic lawyer's answer. generally as far as the s.e.c. goes, when a company has an official company feed on any social media channel, that is

the one they're going to be held responsible for -- >> but i'm saying if there is somebody who is posing as one of these official accounts or someone else, if it is a troll, let's say, on x or on another social media, who is responsible for that? >> i would say the troll is probably responsible for that, but the s.e.c. would -- could ask questions of them, if they -- because market manipulation is its own -- >> if it is never going to be the social media -- i mean, i just wonder about these things. if we post something wrong on cnbc, i would assume it is cnbc's. is the social media company ever responsible for that, or is it too impossible to police and you go back to the compuserve thing where they're just message boards? >> there is always that reasonableness factor. x does offer two-factor authentication, that seems reasonable. i'm not sure why the government account does have it.

i know the gray check marks operate a little differently. but, it would look at, you know, who is the most to blame. if there is a social media account that has lax security, i think the s.e.c. and other potential agencies could hold a social media account liable. >> let's go back to the s.e.c. issue at hand. what happens if the s.e.c. approves this bitcoin etf today or tomorrow? that just seems like such a crazy timeline to have all of this play out. >> it is. and i think, i mean, that's exactly why the market was so prime to react to the false announcement yesterday because it is expected that that approval might come through today. and i don't know that a hacker getting access to the account means that timeline should change, given what an enormous part of the financial markets they are. but it certainly complicates things. >> it does. rebecca, thank you for walking us through this today. >> thank you for having me. >> okay. coming up, a check on the premarket morning movers. and then we're going to talk to pollster and strategist frank

luntz will join us to share his perspective on how to address anti-semitism on college campuses. he has some provocative ideas and could an ethereum etf follow a bitcoin etf if arod?ppve we'll hear from the co-founder of ethereum and co-founder of consensus. all that and more after this. t , now earns 5% apy. 5% apy? that's new! yup, that's how you business differently. power e*trade's award-winning trading app makes trading easier. with its customizable options chain, easy-to-use tools and paper trading to help sharpen your skills, you can stay on top of the market from wherever you are. e*trade from morgan stanley. (♪♪) business can happen virtually anywhere. (♪♪) but there's nothing like being there. at national, you can skip the counter... and choose any car in the aisle... even manage your rental right from the app. so you can give some quality time to a quality cause.

swing by to see one more customer... [audience cheering] and really get down to business. go national. go like a pro. the first time you connected your godaddy website and your store was also the first time you realized... well, we can do anything. cheesecake cookies? the chookie! manage all your sales from one place with a partner that always puts you first. (we did it) start today at godaddy.com

look at this morning's premarket movers. i don't know where you've been, dom. hopefully you can explain, we were trying to figure out tiger. explain that at the end if you can. exactly what went on, maybe nike is just not a golf company anymore. >> nike could still be a golf company, just maybe without tiger. i mean, we'll talk about it at the end. anyway, joe, i'll get through the morning movers first. you just did that whole segment about cryptocurrencies. the s.e.c. hack. bitcoin prices. remember, they're settling around 45,000 or so. they got as high as almost 48,000 in the last 24 hours due to that hack of the s.e.c. social media account on x about the possible approvals of an s.e.c.-backed -- at least s.e.c. approved bitcoin etf. not going to happen, at least not yet. the bitcoin prices fell back

down and we're watching the ecosystem now for some of the stocks. you were talking a minor-like marathon digital, gray scale bitcoin trust, microstrategy, one of the software services that owns bitcoin on its balance sheets and most of them are down in trading so far today in the premarkets. we'll keep an eye on some of those stocks tied to the e ecosystem there. shares of toast, up 3.5%, 40,000 shares of volume, almost about 5% at this point. getting help from goldman sachs, upgrading the company. it goes up to a buy rating, it was a neutral before. the target price up to 24 bucks. it was $16. they like among other things better profitability trends in the coming year alongside gains in market share and discount valuation compared to other software oriented peer companies. toast shares up 5%. and we'll top it off with the m&a deal, hewlett packard

enterprise will buy computer networking equipment maker juniper network in an all cash deal. that's 40 bucks for every share of juniper. the deal basically further bolsters hpe's networking business and it comes a day after "the wall street journal" reported that the companies were in later stage deal talks. so, joe, those shares with juniper are up marginally. we saw the big move yesterday. we'll see what happens. to your nike point, it is an interesting development there, maybe not one that was all unexpected given the fact that tiger's been in foot joy shoes pretty much since the auto accident derailed his professional tour side of things. so, you know, if nike stays in it, that's great. if they don't, it provides an interesting window for certain other smaller apparel and foot ware companies, niche providers, to independent companies to fill the void. >> where is tiger going? >> tiger, there is a lot of speculation about that. i heard folks in the industry

speculate about whether it is taylormade, because he has an equipment deal with taylormade. but taylormade is in clothing, they're not full bore into clothing in the u.s. market like they are other parts in the world, like asia. supply chains are different for companies that do equipment. we'll see what happens there. there is speculation about other brands. he's already a taylormade staffer. doesn't seem like he's leaving that anytime soon. with you go to a travis mathew, you probably wouldn't, because they're owned by callaway. i also heard some industry folks talk about this idea that maybe he could sign on with a smaller more independent label and take an equity stake in that kind of a brand as well. so, you know, it remains to be seen. but, obviously the one that people talk about a lot more these days is titleist, and foot joy, he's been seen in that -- yeah, exactly. >> talking about taylormade as

well. >> yeah. >> here's the thing. there is only three companies really massively in this game right now. it is acushnet, top golf callaway, and then private equity owned taylormade. and those are the big three that are kind of out there floating around. >> here is a question. would his involvement in one of those brands fundamentally change the business? meaning, one of the reasons nike was willing to pay him what they did, especially toward the end, they were trying to build their own golf business for the first time. are you willing to overpay to build a business? if you already have a business and there are three players, does it fundamentally change the dynamic if tiger is your endorsee in this case? >> i'm not sure how much it fundamentally changes the dynamic for a taylormade. because he's already there. he's already been so closely associated with taylormade gear. they basically almost custom

make equipment for his specs. and so the golf world, the people who buy equipment, they all know that the taylormade relationship is there. where it becomes a little bit more interesting is what it adds to, say, acushnet, titleist and foot joy. again, andrew, to this point, it becomes a category game changer, possibly, if it goes to one of these smaller more independent labels that specializes in golf, that's not nike. that's not taylormade. and that's where it becomes perhaps a bit more of a -- >> think about that red shirt with the nike logo. some of the greatest moments in golf are preserved with that look right there. >> remember, you're on a golf course for, like, five hours. if you're wearing a nike swoosh for five hours and televised golf, that's a lot of brand exposure out there, versus, say, a basketball game. >> worth every penny.

okay. in case anyone is interested, i have a callaway driver. you know, i don't know whether -- probably no one is buying a callaway driver based on that? >> i'm not paid to endorse any of these products, but i also have a callaway driver in my bag. >> okay. thanks, dom. when we come back, how to address anti-semitism on college campuses. pollster frank luntz will join us next with thoughts from students. the futures this morning, at this point, relatively flat, dow futures up by 37. s&p 500 futures down by 2.5. the nasdaq indicated by up 11. "squawk box" will be right back.

a moment, remarkable one. focus group more than a dozen college students current and alumni including harvard, penn, columbia and last month. joining us pollster and political strategist frank luntz who brought us that

conversation. frank, tell us about what you learned during that conversation, and, perhaps, ways that universities and maybe others, because we don't want to talk about sprict strictly cont universities but business institutions and businesses are dealing with this issue. >> i focused on the solution first. and that is, zero tolerance. no excuses, no exceptions. that we need to treat anti-semitism at hate, just as we treat racism and sexism and any other discriminatory practices. second it doesn't depend on context. it should be definite. if someone expresses something that is hostile to the jewish community, they have every right for their safe existence, and nothing should challenge that. third, this should be freedom from fear.

just as we say and teach, believe the victim. believe the woman. when we have these conversations about rape and about sexual assault, it's the same thing with racism and the same thing with anti-jewish hate. which is really what it is. fourth, people who are watching this program right now have considerable financial needs, and one of the greatest problems is that they continue to donate to these very same institutions or participate in these very same businesses that are exhibiting anti-semitic behavior. that has to stop. >> frank, i want to stop you to ask two delicate and complicated questions. when you listen to that first video which we brought in ahead of you speaking just now, there is in this question mark -- i know viewers are watching -- saying there's a distinction between being supportive of a potential palestinian state and

a hate speech against jews and that there should be a distinction about that. sometimes when people talk about context, and when you just said, there should be i don't context, they are referring to that. by the way, i'm not in favor of that, as you know, but how do you think about that and when did you learn when you spoke to students about it? what did you learn? >> specific. we heard and saw in some rallies. it's not just from the river to the sea, which means no israel. it's by any means necessary, and that means whatever you do is acceptable in bringing about a palestinian state. the butchering of children, the raping of women. the hostility towards the jewish community right here in america. that we have to stop turning a blind eye to it, andrew, and accepting it for what it is. and it is hate. you are correct. how we define it, how we listen to it is important, but the fact

is these universities aren't -- laboratories of open discussion. 20% -- >> listen to this, though. one thing you're doing, i think, advocating for donors to pull money and the like from universities that you don't think are behaving the way you want them to, and i have advanced ideas like that in many ways over the years, as relates to a whole bunch of issues. having said that, one of the criticisms that i have gotten as it relates to this specific issue goes to this sort of oppressed, oppressor framework. to say that people look and say that those who have money are then using their influence and some people are arguing misusing their influence. what do you think about that? >> i understand that point, and it's because they're trying to silence their opponents. that in the end we should not even be having this discussion. this segment should not be

necessary. you can tell by my tone how frightened i am about the conditions right now at universities as they go back to school after the christmas break. and i'm afraid that more jewish students are going to be attacked, because those who hate them feel they can get away with it. you would never say this to a black student, and you shouldn't. you would never say this to a latino, and you shouldn't. you cannot frighten or condemn a transgender student, but for some reason, if they're jewish, you call them oppressors and that justifies whatever attack you make. >> let's broaden this conversation out to the business community, because one of the other things that's come up recently is the focus on dei university sass attached to a focus on dei in businesses which attached to this idea of esg, a phenomenon we talked about practically almost every day on

this broadcast and network the last five years, if not more. >> the key component there isn't diversity, equity and inclusion. it's mutual respect. and that is what the public, what black employees, what latino employees what transgender employees. employees aren't looking for diversity, equity and inclusion. they want to know that there is respect for every employee, in every community or from every community in every corner of the country, and that these businesses that are putting dei into an ideological framework thinking they have to be progressive, all you have to do is look at the landscape. consumers are turning against them. because they don't want these businesses playing politics. they do want every individual respected, they do want people treated with decency and civility and equality, but that's different from bringing it into a political, partisan or

ideological context. andrew, we are at a tipping point right now with the public prepared to get deeply involved and aggressively involved in corporations that they feel do not respect them and do not appreciate their points of view. don't bring politics into it as you are seeking to broaden the employee pool and have everybody in. >> it's a long conversation but we appreciate it. look forward to talking about it and other things. politics, very, very punitive. thanks. still to come, the co-founder of ethereum joins us to talk about yesterday's wild bitcoin debacle by the s.e.c. the possibility of an ethereum es etf and digital currency overall. later, border funding. senator john cornyn will be joining us. we'll be right back.

good morning. chaos in crypto world. the s.e.c. appears to approve spot bitcoin etfs for trading and admits its x account was hacked in nothing's final. boeing ceo, admitting a mistake following a blownout door plug.

the jet remains grounded as the investigation heats up. time running short for the government to fund itself. even this after last weekend's top spending deal. we will speak with gop senator john cornyn about the funding. u.s. border leakage and so much more. final hour of "squawk box" begins right now. good morning and welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square where it's, anything can happen on any given day. i'm joe kernen along with becky quick and andrew ross sorkin. come on down here, and stand around a window and, i don't know, do hand stands, crazy hand movements -- oh, he's gone. what the hell happened? i missed that. people watching earlier.

we have -- yeah. that's good. >> hey, we're in times square. >> i live out this exit over here. definitely don't go out that one, just in case anyone's wondering. right? >> a first. >> many times. u.s. equity futures at this hour not a lot to talk about. you can see the dow, though, now down about 39 points. seems like in a little bit of a consolidation phase after that blockbuster ending last year. nasdaq in positive territory. s&p down just marginally. the ten year, wow. around 4%. exactly. >> this morning -- >> it's exactly 4% this morning and also watching bitcoin. prices jumped up to around 48,000 then fell yesterday. the s.e.c. put out a tweet saying, it will hadn't hacked. the tweet, approved spot bitcoin

etf for trading and then s.e.c. chair gary gensler quickly posted his own tweet saying nothing approve and s.e.c.'s account had been compromised. x's safety account confirmed that. a preliminary investigation indicated someone gained control over a phone number associated with the s.e.c.'s account through a third party and we're going to talk more about this story in just a little bit. with co-founder of the ethereum, and all could have been avoided if -- not taken, like, so long to finally get to this point, but it's just -- painstakingly grinding towards the possibility of a spot etf. only it probably -- finally happens sometime. no idea. you know, makes you wonder about the wheels of government and how they turn. >> yep. >> you know? >> also, boeing, another big feck is this morning. the ceo creating employees over the door plug blowout on an

alaska airlines flight last week. according to remarks shared by the company, calhoun acknowledged boeing made a mistake saying it will work with regulators in their investigation what happened to the 737 max 9 jet. the faa says boeing must provide operators instructions for inspections and maintenance beyond an initial version offered monday. calhoun will join the exchange this afternoon at 1:00 p.m. eastern time for an exclusive interview with phil lebeau. don't miss that. back to the broader markets and again with mike santoli, our own. down at the new york stock exchange. what are you watching? >> andrew, yeah. monitoring this prolong ed paus in the broad market, joe said consolidating. strong fourth quarter since 2023. 2% decline. hottest areas, small caps, of the fourth quarter raury come off a little bit more. it's unclear if this, much to this aside from just digesting that big rally.

we are hovering just below the all-time highs, intraday 4818. closing high more like 4796. pretty much right there. i would say again, looking around this, a little below that. about 4,600 we launched in december. broke out to a new high. pull back to that still no big deal. 4550, december low. old trader's rowel of thumb. don't see december low breached first part of the new year. so far well clear of that. i do find it interesting, though, go back four years to right before the covid crash. you see we have a new obsession of the trading community in terms of the big interruptive company. nasdaq versus tesla. the tesla move in 2020, 2021 was so monstrous. even the 100% gain in tesla last year didn't really recover most of it and you see now nvidia outperforming on that basis consuming all sex we know.

the average conductor stock underperformed over that period. remarkable. 1.3 trillion dollar market cap for nvidia now 750 for tesla with the same kind intensity, huge dollar turnover in the stock tesla had couple years ago. see how it goes. the move anticipated production to scale provided cash flow. obviously market moves ahead of fundamentals. see if that also applies to nvidia. investment banking boutique stocks. m & a deal advisory companies that moved into evercore, pjt partners and iai the overall broker dealer in that. probably have makings of increased m & a and other deal activity in the works. see if that pans out. we've had false starts there in the past, but merger, volume,

relative to the total market cap is depressed and has been for about a year. >> okay. mike, thank you. we'll keep our eyes on all of it. appreciate it. >> joining us now for more on the markets, heads, related to boeing? you're not? >> pronounced it protectly. thank you, joe. >> looks like -- yeah. doesn't look -- well, looks like what it is. heads an investment strategy team serves as head of platforms for the u.s. client group. i think you're not willing to, i guess not ready to jump up and down with excitement but don't think we're necessarily set up for a big decline? although five or six fed cuts, market might have gotten a little too optimistic on that? >> i think that's right. i think the market -- well, let me back up a little bit. the market's been more right than the fed. right? fed was late to hike rates. with think the fed will be late to cut rates.

that's when the mismatch is in the market now. optimism around five, six cuts this year. maybe get three. get more than that, something's gone wrong. stress in the markets. something comes out of left field that could cause increased slowing in the economy. and the fed would cut more in that scenario. see stocks rallying in that environment. poised waiting for cpi date a tomorrow. not that exciting, i think. maybe in line with expectations or slightly better in terms of down side but pace of decline in inflation will slow dramatically this year. rel toiv what we saw last year. i don't think that's a good thing for markets. >> with the political backdrop, will there really be anything other than that that is as exciting as what we've seen in recent years? jay powell, i mean, if his eyebrow twitched we thought it meant something. 4%. no. it's 5%. no below -- all of those things

could become more stable and we might just be just agonizing over what happens in this election? >> agonizing? probably too much to hope for. that would really start to take hold second half of this year getting closer to election day, and most certainty, not 100% certain, but some idea who the leading candidate is and what might be results of that election, but i think the first half of this year epitomizeed by a lot of continued uncertainty around when do they jut when's the first cut? march, june, july? how quickly do they cut from there? >> you said nothing about hike. you said first cut? >> i would be shocked if they it -- >> a recession? you don't think recession? >> i don't. >> first time in history successfully done this. isn't it? >> we talk about a soft landing. right before we go into recession. right? i think the difference this time around, go into recession might be a shoulder shrug.

right? relative to what we experienced. obviously the pandemic an anomaly. what we experienced in 2008, 2009, and experienced in 2001. a slowdown down to 1%, which would be awfully close to tripping into a recession. but i don't think there's much difference there. negative 1%. positive 1%. yes, means something to gdp growth for consumers but not sending the market into a tailspin. >> 20 times earnings -- >> too much. skewed by the magnificent seven, and so i think what we're see this year broadening out of participation in the market. equal-weighted index doesn't trade 20 times but sort of 16 times. right? the rest of the stocks, 500 stocks equally weighted versus, skewed by 30% to 40% of the s&p 500 and seven stocks. >> earnings have to grow this year to support where valuationing are right now? >> i think so. >> how much will they grow?

>> so the expectations are for 11%. way too optimistic, i think. coming into fourth quarter earnings this year you saw analysts cut expectations quite a bit. 6%, 7%. bar set really, really low. really interested to see what companies say about their expectations for growth this year. i expect a lot of caution. not going away given amount of uncertainty in the market. very surprised if we get 11% growth this year. >> and down, though, earni ings season, companies are cautious and doesn't match up, kind of where rubber meets the road and markets recesses? >> no. i think companies will beat estimates. bar is so low. almost on the floor. would be hard to surprise the upside. what will happen i think analysts start cutting out-quarters estimates and get that 11% moving down into the mid single digits. not a one-day catalyst. all right, have the information needed now sell stocks. probably at least for the time being more related to what the

fed does and what information can we glean from economic data to make a decision whether to buy more or start taking risk off the take. >> what city did you grow up in? >> sydney, australia. >> what is the most annoying cliche about -- let me ask, you have ever thrown a shrimp on the barbie? >> i have. never eat the blumin' onion. a little intimidated. >> foster's. >> yes. disappointing. >> a man at work guy and -- >> vegemite sandwiches. >> yes. with a beer. >> not a -- >> see what i mean? going to take this to a level so annoying you might not come back. no. it's good -- never beenhave you? >> absolutely. >> you knew? >> yep. >> i am missing out. >> it's beautiful. >> it's good. >> another one. >> the only thing stopping you.

>> another one. that's not a knife. this is a knife. >> that was really good. >> in the sequel. do a remake. >> crocodile dundee! >> like that. >> thanks. i get to do that because of -- >> you're the only one. all right, becky and andrew. >> richard. >> thank you all. when we come back much more on the s.e.c. weighing approvals eangithe bitcoin etfs. spki wh joseph lubin. xwb "squawk box" will be right back.

. welcome back to "squawk box." a lot of confusion in the crypto world after a tweet in the s.e.c.'s x account saying first approved. not true. chair gary gensler quickly posting that the agency's account had been compromiseding call. may be true today. we'll see. joining us one of the architects of the crypto area, blockchain and co-founder of web 3 a software company consensus. good morning. what did you think when you first saw the tweet yesterday?

>> so i wasn't watching the market directly at that point. i heard about it from colleagues and essentially it's an unfortunate, unforced error. symptomatic unforced errors that politicians and regulators have been committing in america around the world politicians and regulators have recognized that blockchain and crypto are powerful disruptive technologies and taking a considered, mature approach to understanding how the technology will benefit society and how it should be regulated, and there's just been so much pent-up demand already in the system that it caused somebody to play a prank or to take advantage of the s.e.c. sources to effectively manipulate markets. >> talk about the prospect may come after, frankly, approval of bitcoin etf, may well be

ethereum. talk about that in a moment, but i'm more curious about why you think it's -- assume they're going to say "yes." maybe that's a good or bad assumption, but assuming that's the case, do you think they should have done this two and three years earlier? do you think shifts and changes in the evolution of that ecosystem that needed regulation and other things that are now in a better place that would explain why today is different than it would have been three years ago? >> yes. i think one argument is that there were immature markets that could be used to manipulate the price of the total assets, but the fact is people had exposure either directly or through other financial instruments like gpc and retail caterers, other investors harmed and etfs are

much more efficient instruments and should have been made available a long time ago. >> you make a distinction, can you, between bitcoin and ethereum in the following way? bitcoin, digital gold. people thought a true currency rather than sort of a store of value. ethereum is very different. so the question is, does ethereum need an etf in the same way? >> yes. so bitcoin can be a store of value or a collateral currency. there are transactional currency called stablecoins. many are on ethereum, ethereum is a commodity. it's, we call it a crypto fuel because it powers transactions and storage on a network. ethereum is a platform for building decentralized applications and decentralized applications are present, a new

kind of technology, and, or a new kind of industry. we need deep liquid and broadly accessible financial instruments to enable the industry to operate for effectively just like agriculture and manufacturing, done for decades. >> your sense, more people will ultimately get access or buy or invest in bitcoin through etfs and the like, or by actually buying the underlying asset? >> yes. so in 1997, an executive might ask their secretary to type up an email and send that email. and that's simply because the technology was difficult for that executive to directly operate at that point. but the message got through, and the executive and the technology both got more capable. there is so much money on the sidelines managed by registered

investment advisers and different funds like retirement funds and companies that want to access the technology want exposure to these uncorrelated assets or digital asset class. and so there was a bit of run-up by speculators in our own industry, in the price of bitcoin anticipating these etfs and soon hopefully that they're an etf. but the point is, there's a giant amount of money. hundreds of billions on the sidelines that's waiting to get exposure to this. >> wt your sense in terms of conversations you've had about the prospect of ethereum or solana etf or other currencies allowed to go down this path, if in fact we get to an approval on bitcoin? >> ethereum is arguably the most mature system, the deepest ecosystem as a platform

centralizes applications. so much infrastructure and activity around the world. bitcoin is a narrower technology but reasonably mature technology so both candidates. >> and if -- >> one is a great technology, but it's not mature ecosystem yet. >> take that out of the equation for a second and talk about ethereum. have you spoken to the s.e.c. recently and gotten any indication that you are next on the docket? >> no. >> no? >> they don't tell us they're intentions. >> the reason i ask, because i think over the last several months it's been clear indications or signaling or something going on where people seem to know or think they know about what's happening as relates to bitcoin in the etf? >> so we're like maybe like the secretary in 1997 or the builders of the email system in 1993. we have direct hands-on to making the technology and making

the technology usable. we are much less focused at consensus on sort of more traditional financial instruments enabling the industry to get access to this technology. >> appreciate you joining us and we may or may not see approval of bitcoin that is. we'll see. >> hope today is the inflection point for protocol. >> thanks. coming up, a.i. plays in our day-to-day lives. a big focus at this year's consumer electronics show in vegas. take you live to sin city when "squawk box" returns.

where's the beef? apparently with mark zuckerberg in hawaii. facebook founder posting on instagram that he has now started raising cattle at his ranch on kawhi with the goal creating some of the highest-quality meat in the world. he said the cows will be fed macadamian meal and drink beer. foster, "beer." also produced at the ranch, zuckerberg called this the most delicious -- i immediately think

about the farts and would be very anti -- >> talking about the cow. >> so woke surprised mark isn't spending more money with that delicious chemically-made beef that -- no -- one -- eats -- anymore. do they? every fast-food, signing deals. everything! the sausage, the fake sausage on -- is anyone eastern touching that stuff? >> only bill gates. >> kind of looks like he eats that stuff. >> impossible burgers and the other one? what was that? >> and julia next. >> moving on. the consumer electronics show is back in las vegas. 130,000 attendees checking out the latest from 4,000 companies. our julia boorstin joins us now with a look at big trends taking over the convention.

hi, julia. >> good morning, becky. right. here in las vegas at the consumer electronic show, and this year it's all about art fib sy artificial intelligence. incorporated into every gadget. samsung showcasing a.i. companion robot that interacts with other smart devices in the house, can project pictures, videos on your walls or check on your pets sending pictures of them to you when you're out of the house. samsung's new a.i. refrigerators tells you what's inside, expiration date and recipes based on ingredients you already have and let's you order ingredients you don't have in the fridge. >> for the refrigerator it's definitely about convenience in the kitchen. right? automated the different tasks you want to do because they're household chores making it more exciting to spend more time with your family. >> this year more enabled a.i. cars and tractors than ever before with intel announcing a

new a.i. chip customized for vehicles as the company vows with nvidia am. and this designs, they say, to be empathetic and respond to the mood of the driver with directions and restaurant recommendations. meanwhile, l'oreal became the first company to have a beauty ceo keynote here at ces demonstrating its a.i.-powered beauty advisor as well as a virtual makeup try-on. not all the a.i. here was entirely ready for primetime. meta here showcasing ray ban glasses brut the new a.i. tool zuckerberg announced for the glasses weren't quite ready to demo just yet. back to you. >> those glasses look a heck of a lot better than the other glasses seen tried on before. huge box ones. those looked really stylish.

julia, the thing i thought the most listening to everything you talked about, the cool stuff out there. how many things are broke than require multiple people to come fix them. i mean, a.i. stuff is great. electronic stuff is great. just make it work. >> that's a good question. if your refrigerator is connected to the internet to and has software, maybe update the software remotely and -- would you need someone to come fix it? >> it's not just the things to make the parts work to make it cold, it's like now i got to have the i.t. guy making sure the internet stuff works. >> ultimately everything in your house will be computer, sam sung also had a washing machine that is a.i. powered to use less power, to dry and wash your clothes. all of this seemed very cool and i did enjoy the refrigerator dome oh. that would be useful. >> thank you. look forward to a lot more fun stuff from out there. when we kim back, former commerce second carlos gutierrez

joins us on the state of labor in the united states, and we'll get his take on all of those recent revisions to the monthly job numbers. stay tuned. you're watching "squawk box" and this is cnbc.

yeah. welcome back to "squawk box" pap new read on consumer strength. steve liesman joins us this morning with the number there's. steve? >> hey, good morning, andrew. yeah. interesting story here. cnbc retail monitor for december, which uses actual credit card data from affinity solutions show retailers going up but the true state of spending may now be clouded by a new factor. deflation. retail sales auto and gas according to the cnbc national retail federation monitor up 0.4%. that's just a bit below the average from the strong number of 0.8% in the prior month. year over year slips to 3.1 from 4.2. core retail sales removes restaurants. struggled a bit. up 0.2% compared to 0.7% in the prior month. year over year 2-4 versus 4-2 in

the last reading's some give back from the strong numbers inevitable. economists expect the economy to cool overall fourth quarter after outsized growth numbers in the third. simply too soon to say if it's beginning of a broader consumer slowdown worth watching. however whoo, what we know, slo in housing industry. all thee biggest negative numbers are housing related. housing and appliances down, furniture and home furnishing down. but general merchandise stores did okay. people out in restaurants and bars up 1.5%. non-store retailers. your internet retailer -- up 2.6%. deflation another factor. goods prices take out food and energy falling six straight months down 3.7% annualized from june through november. some of the categories with big spending declines also sharp price declines if you used

december inflation numbers. that in mind, here are results from the 2023 holiday season. up 3.7% on the top line there. take out restaurants, up 3.3%. a pretty good christmas. after months of subtracting inflation, guys, get the true state of the consumer, well, add back deflation in some sectors. the question, how retailers are managing margins and can be profitable with prices on the way up as they are now with prices on the way down. andrew? >> steve, it's a fascinating one and we are going to continue this conversation. i don't know if steve can stick around for this conversation? listening. >> listening. >> thank you for joining us. a lot to think about. in fact, joining us now to talk more about the consumer, workers and what he's watching in 2024 is carlos gutierrez. former u.s. secretary of commerce. former chairman and ceo of the kellogg company and a cnbc

contributor and carlos, welcome. >> thank you, becky. appreciate it. >> talk a little about what steve just mentioned. inflation picture that now deflationary picture in some places. i've used this on-air a few times recently. trying to get a feeling from people, because there was a moment during the pandemic the things that you said when you came on with us, that have stuck with me ever since. you talked about how you had managed inflation in the past. understood kellogg and south america, i think mexico? running -- >> yes. latin america. >> very high levels of inflation. and you gave a warning to ceo-the-that point. if they didn't get with it and realize that inflation was coming and raise prices as a result that they would never be able to catch up. and profits would suffer greatly. we're seeing a little bit reversal of that at this point. maybe it plays out with carrefour and pepsico. the palgtsbattle saying no long working because of price hikes pepsi had been putting through.

where do things stand now? what is your message on the inflation/deflation picture and what would you tell ceos now? >> in the carrefour and pepsi example, that's a good one. it's late in the game. that's why we're saying, take it now. take prices early. may regret it a couple months but there will come a point where companies can't take pricing anymore, and i think we're getting there. and, by the way, going to carrefour, what do you do? back to the others. say i gave them a special deal? it's really, why companies here go walmart first. they can say, hey, walmart's taking the price increase. >> walmart toughest? >> walmart, toughest. most other take it. i don't know where carrefour stands. but i think there's a lot of discounting going on. consumers aren't really seeing

the regular pricing. especially in grocery stores. they are in restaurants and others. >> meaning the list price? at a grocery store, no longer the list price. just like pharmaceuticals at this point. >> yeah. it's like e everything i look at, and i still visit grocery stores. still a habit. it's on sale. there's a deal. there's a buy one get one free. increased prices ten, give back four, five. so consumers -- you know, get used to it. now, pricing at restaurants, that's regular pricing. where the price increase comes through for the company, but there are very few companies feeling 3% inflation. i think, you know, 3% is maybe by the consumer level, but talking about services. maintenance, parks, parts, economic, the kind of thingses that go beyond salaries. more than 3% inflation out there. so i think there's still n in t

that hasn't come out. i still see shortages. and there are shortages out there. that are still being held up. so 3%, i think 3% is probably a good number, plateaus, but wouldn't be surprised if we had a couple of months with higher inflation in 2024. >> you can see pressure points building. like with the red sea and shipments having to go around the cape of good hope. how that is going to add time and money to the cost of companies to this point, too. >> right. interesting. that hasn't been fully seen in oil prices. not yet. but this morning gets worse. that's the kind of thing. there's so many unknowns next year. just so many things that the status quo -- the most likely picture almost seems unlikely. you know? biden versus trump. really? you know -- everything gets sorted out in the middle east.

well, it doesn't. russia, it -- and just keeps coming and coming. so -- >> you've made an interesting point. companies that are facing all of these cost pressures. you say take what you can. if president biden heard you say that points companies at gougers for causing inflation and they don't fundamentally understand what companies need to do. do they? >> i agree. >> shareholder profits are everything, but that is why people risk their money to -- >> right. >> -- to participate in the american economic system. >> right. >> if you -- but when you said that, did you say, what am i saying? this is not going over well and i'm saying companies should take price increases now while they can? you're not helping. >> well i think i am. in the sense that -- >> you know what i mean, though? >> you're absolutely right.

sounds awful and if you don't know a bit of the substance it's hard to understand, but if you don't take it your margins decline. margins decline, you have to lay off people. >> right. >> it's just -- it's a vicious cycle. >> when do you think this moment happens where you can't take it up? >> i think it's beginning. >> probably some industries can't take it up now. >> i think it's beginning to happen, and company didn't go up, say, 5%. a lot of like 10%, 12%. easy deal wig smaing with small but think we're getting to that stage now. companies can take pricing and surprised it's happening to pepsi because they have brands you have to v. it's tostitos. >> a bit late and important to do it now when you see it coming. and the kind of inflation we have is probably good to look at not cost in your system now, but next cost.

so it's next cost in. what's my cost in five months? that's where i have to price to, because which i start collecting the money, that's what i'm going to be dealing with. so -- >> carlos gutierrez. we are really thrilled to have you as a cnbc contributor. >> pleasure. thank you. >> appreciate that we're going to be able to talk to you a lot more. >> thank you. >> still froot loops. what they call them? lucky charms. >> north america. >> and congress getting a final deal. we'll hear from republican senator john cornyn. "squawk box" is coming light back.

power e*trade's easy-to-use tools, like dynamic charting and risk-reward analysis, help make trading feel effortless. and its customizable scans with social sentiment help you find and unlock opportunities in the market. e*trade from morgan stanley. with powerful, easy-to-use tools, power e*trade makes complex trading easier. react to fast-moving markets with dynamic charting and a futures ladder that lets you place, flatten, or reverse orders so you won't miss an opportunity. e*trade from morgan stanley.

a little more than a week now remaining before funding expires for about 20% of the federal government congressional leaders announcing roughly $1.6 trillion spending deal. last weekend. unclear still whether that can pass in time to avoid a partial shutdown. joining us now, republican senator john cornyn. great state of texas. good to see you, senator. >> good to see you. >> had a rent-a-car in georgia and i felt good. not really sure why. i like texas. i really, really like texas and

i was proud to be driving that thing around. people staid out of my way. dammit. is this going to happen, do you think? where do we stand right now? >> speaker johnson has two-vote margin in the house. his hope is to get, move forward four separate operations bills off the 12 we're supposed to pass each year. i'm afraid the time is so late and the time is so short, i should say, between now and january the 19th that in all likelihood we'll have to pass another short-term continuing resolution in order to try to get the appropriations process in place. but this could ask have been avd if we'd simply started earlier. the senate passed, appropriations committee, 12 bipartisan appropriation bills ready for action on the floor of the senate last summer, but now time is so compressed and the

deadline so short i'm afraid we're looking at another short-term continuing resolution. >> normal americans, senator, just, you know, they say overused phrase about making sausage, but a lot of them really don't care about the minutia of trying to do all of these things to keep the government open. what they do care about is that government starts addressing some of these really big problems that we have, and one is immigration. talking about it all day long, and -- >> right. >> -- every day seems like it's more people are, are just -- cannot believe the situation we find ourselves in. and it does play into the funding we're trying to do and funding ukraine, funding israel and everything else. can you give me an outline of the big picture on what we need to do and what politicians should be doing for the people? >> well, there's no worse, no state more negatively impacted than my state of texas.

we have 1,200 miles of common border with mexico. finally, national leaders like the mayor of new york and washington, d.c. are finally taking notice, because it's impacting them, but it's been impacting me and my constituents for the last three year where is we've seen unprecedented levels of people showing up at the border, and doing one of two things. either claiming asylum and being released into the interior of the united states or simply, or being released with not even claiming asylum. then, of course, then, theren the 1.7 million so-called got-aways evading law enforcement. this is a man-made disaster, and the man who made it was joe biden, because of his open border policies, and the welcome mat that he has put out to people coming from around the world literally hundreds of different countries, and because they know they can make it. meantime, the neem continue to get richer are the criminal

organizations that smuggle people frarnld tom around the w well as drug cartel that kills 108,000 americans last year alone. this is a man-made disaster and the man who made is joe biden. >> i see that the secretary, every time she fields a question, she has a pat answer for that, that republicans refuse to fund any money for closing the border. she's got some arcane bill that didn't pass because that was included in it, so that's the throwaway answer she's able to give someone fed to her and that's what you hear every time. so, everybody's -- just like this. we're just pointing blame at each other while terrorists could be entering the country and little babies are crawling on a rug that had fentanyl in it and they're dying. it's embarrassing as a country for the united states to be in this position. >> well, we have -- you

mentioned the emergency supplemental that the president's requested for ukraine, for israel, for the indo-pacific, and yes, the border too. senator james langford, our colleague from oklahoma, has been in negotiations to try to use this unique point of leverage, and i think this is sort of an inflection point for the country. i have been in the senate a long time now, and you're right. all we've been able to do is talk about it, and nothing seems to happen. but i think this is a unique opportunity for us to actually do things that will make a difference in terms of the flow of people across the border. the problem is congress can pass a law, but it's up to the executive branch, the president, to actually enforce the law, and so far, president biden's been unwilling to use the laws already on the books to do just that. but we're going to not only provide more tools to control the border but also for the next president to use as well, somebody who's more willing to

enforce the law and to control the influx of humanity across the border. >> i think there's -- the primary season is coming up, senator. like tuesday. right? >> right. >> can you -- i mean, i follow you on twitter. i think you follow me. you're such a, you know, a straight-laced guy. have you endorsed donald trump at this point for president? >> you know, i'm going to wait and let the primary voters make that selection. if the vote was today, it looks like president trump would be the nominee, and i'll certainly support the nominee in my party over joe biden. but i think there's still a story to be told here in the -- in iowa and new hampshire and south carolina and in my experience in politics has been that sometimes it surprises you. so, i'm going to wait to see how this unfolds. >> well, we have had a lot of things happen recently where if

you live long enough, both of us know, if you live long enough, nothing shocks us anymore, does it? it's just where we're living. it seems like i say it every day. we just shake our heads at the times we're living in. senator, thank you, and good luck, and hope to see you again soon. >> great to be with you. thank you. >> okay. coming up, we are going to talk markets and get you ready for the opening bell on wall street. as we head to a break, you might see that we have some special guests behind us. we want to say hi to a very special group of young men. this is the rutgers lacrosse team. this team actually has been ranked in the preseason as number 15 coming into this. they were the six seed in the tournament that they played at the end of last year. they are back at school already because they've got their home opener coming up on february 3rd.

they're busy. >> look how good they look. >> well, they are wall street bound. they're going to be learning a lot about wall street today. >> faber can't wear a tie on friday, but these guys can? that's great. >> we are appreciating that they are here today. they're visiting with us. they're going to head to bank of america. they have big plans today, and we're glad they're here. we'll be right back. oooohhh, it is cold outside time to protect your vehichle from winters wrath of course the hot sun can be tough on vehicles too you need weathertech all year round! come on, protect your investment laser measured floorliners and cargoliner will shield the carpeting from sand and snow for your interior, there's seat protector and sunshade plus, mudflaps and bumpstep for the exterior order american made products at weathertech.com surfs up yeah, right

you know what's interesting these days? bitcoin. look for bitwise, my friends. your shipping manager left to “find themself.” leaving you lost. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire

welcome back to "squawk box." joining us right now to talk about the markets, senior investment strategist at edward jones. i don't know if you have been listening to parts of the broadcast, but from some senses, inflation may not be going away, we've got other worries about where the consumer is and how much money they're making. what are you thinking right now? >> look, i think we're headed towards what we're calling the last mile on these fundamental issues. inflation is one of them. getting from 3% to 2% may be bumpy along the path, but we think we're heading in the right direction of travel. we think especially, given what we're seeing in realtime in terms of shelter and wages, we can get core inflation down to meaningfully closer 2% level, and then of course, the other parts of the last mile are the fed. fed is actually going to go from probably a pause to a pivot sometime in 2024, maybe not as

soon as the march meeting as a lot of market participants are hoping for, but we think they're headed toward rate cuts, and the third part of the last mile is in the economy, so we'll get an answer on whether we're getting a soft landing, a hardish landing, but in our view, if the economy holds up, which is our base case, we may slow to potential below growth but we're not heading into a recessionary environment. that is a good backdrop for markets broadly. if you have a fed that's cutting rates and an economy that is slowing but not recessionary, markets can look through that and perform. >> you're bullish after what was a pretty bullish year. would you buy the markets broadly, or is there something specific you would do? >> i think after 24% year, we can't expect a repeat of that indefinitely. 24% of the s&p 500, that is. but of course, there are opportunities, and i know a lot of guests you have had on have talked about this as well, but when you think about what drove markets in 2023, it was really this barbell between the

magnificent and then cash, cds, cash-like investments. now, when we look at 2024, we are seeing a broadening. if the theme of 2023 was narrow leadership, 2024 will be broader leadership. you want to make sure that you have not only that mag seven and artificial intelligence exposure but also some of that equal weighted s&p, the s&p 493, parts of value and cyclical, even mid and small cap, which, of course, are starting to play catch-up but we think have more scope to run and finally your bond portfolio becomes more meaningful this year, especially if you're taking some of that cash-like instruments and slowly complementing it with bonds. >> we got to go. ten seconds. would you buy the bitcoin etf? yes or no? >> hello? >> you still there? >> yep. >> we lost her. >> i think we lost her. >> did we? >> buy or short the etf? >> buy the etf, the bitcoin etf, assuming it's approved?

>> me? >> yes, you. yes, you. >> i wasn't sure if i was back. you know, i think the -- bitcoin etf is bgreat part of your speculative basket. everybody has that 5% that's lottery ticket money, but that's a great place to put it. >> make sure you join us tomorrow. thank you, mona. "squawk on the street" begins right now. >> lottery? ♪ good wednesday morning, welcome to "squawk on the street," i'm carl quintanilla with sara eisen at post nine of the new york stock exchange. faber is at hq. cramer is on assignment. futures a bit soggy as investors await tomorrow. oil is elevated on a new round of houthi attacks in the red sea. ten-year is below 4%. our road map begins with watching tech. rbc downgrading the sector, and one apple analyst sees little room for upside. nvidia notching it