the two-year sitting right at 4.44%. bitcoin back to 30,000 and change. not sure where it is now. w tfrmentsi is coming off its highest level since we've seen since december 26th. that does it for us today. we'll beright back here tomorrow. right now, stick around for "squawk on the street." they've got the rock. we'll see you later. dude tuesday morning. welcome to "squawk on the street." pre markets trying to get some traction as this earlier round of industrial q4 earnings have either revenue or guidance on the light side. problem tor, ge, netflix reports to nye. the dow's first close above 38k. >> speaking of the blue chips, 3m, j&j, verizon, procter & gamble are leading today's earnings parade.

we'll break down the winners and the losers. china weighing measures to prop up sagging markets. the shanghai down about 7% this year but is rebounding a bit. >> why don't you say take advantage of the bargains of people who are selling. >> i'll get to all the earnings in a moment. first, as becky said, coming up this hour, dwayne johnson is with us, set to ring the opening bell after being appointed to the board of wwe and ufc parent tko. he'll join us this hour along the tka ceo. netflix is a big part of it. >> that's the biggest part by far. that's the reason stock is up so dramatically. that's going to have an impact, as you might imagine, on endeavor which owns majority

stake in tko. this netflix deal according to filings again, over $5 billion over ten years. that's a number, guys, that's in excess of what many investors were anticipating. of course, for netflix, earnings of which we're not far from getting. it's an interesting move as well. live events which they have had very few of. it will raise the prospect are they going to get deeper than sports. it's both, but will they get into live sports? >> i know from talking to sal central nick, the video games for wwe, this is huge. he never accused me of being a snop because i don't go to long island where i see it. but he does remind me that the number of people that love this sport is so in excess of what wall street thinks it is, that i've conceded that i'm a bit of

a -- lacking in knowledge. he says listen, let's go to -- sounds like it's interesting. it's rabid. the people are rabid. >> the fan base is an interesting one, perhaps for netflix as well. again, carl, it's outside the u.s. as well, there are a lot of rights to come with this. interesting move from netflix. the dollar numbers seem to be in excess of what had been anticipated for the renewal of raw. >> we'll talk about what it means for cable. the oscar nominations out as well. results from industrial giants 3m, rtx, ge, united in there, too, jim. what strikes you as the most interesting? >> i like the procter & gamble margins are incredible. waiting for the margin explosion and we didn't get it. if you remember the previous call, they were talking about how the dollar is going to so offset the margin expansion you wouldn't notice it. not true. the other side is -- i don't

know what happened to beauty. people just don't want to be beautiful anymore or they want to be beautiful using elf. the gross margins i've been disappointed. six straight quarters of them beating the street. i think people will start noticing, you know what? proctor is well run. >> muller on squawk this morning saying he just got back from china a few weeks ago. it's tough. china down 15. >> i know. i think there are people who say, well, i've got to sell for that. i think it's one of the most telegraphed chinese doing badly sto stories. what they do is try to find a country that's not doing well and emphasize it. you know what? the uruguay numbers, turns out they're not using -- i've been critical of management here.

i'm tierpd of that. what? big ipo on friday, kaz stan. borat covered the whole thing. >> i'm just saying procter seemed to be, at least in the interview with squawk, getting more upbeat about the amazing business they have. it was getting upsetting to me. david taylor would emphasize what was good. mueller seems to 'em fa sielz what is bad. he's got to flip that. >> he did say price up four, volume flat. he said we're going to have to get volume at some point. >> there was another instance where no one has volume. he's got flat volume. that's a big one versus, say, conagra. he's a glass half empty guy if i've ever seen one. it's rather extraordinary. it's time for him to get a pep

talk. >> all right. little pep talk there. let's talk ge a little bit. stocks down a little bit. >> it's down four -- what are people doing? who are they speaking to? >> i don't know who they're speaking to. >> i don't either. >> the stock has had an immense run. larry culp hit his stride a year and a half ago or so. now expectations seem to be a bit higher. q4 free cash flow came in in line. people may have been anticipating a beat because that's the way things have gone lately. even the guidance seems to be somewhat underwhelming for '24. >> he's got to do the split-off. service revenue is extraordinary. you know what the problem is, david? >> what is the problem, david? >> inflation. we still have inflation

problems. i can't believe they still can't find the workers and still can't get the materials. it's funny, because when you speak to management, one of the first things they say is, hey, what is the fed thinking with the five cuts which is the actual goldman thing. five cuts. they're still paying for everything. unless you can say, listen, that's not what we're talking about, we're talking about the supermarket. i think it's part of the partner of the cpi and these things aren't coming in. by the way, they're not coming in for rtx either. >> no. >> can't find enough engineers. can't. >> we'll talk more about that. you're going to stick around for part of the 10:00 a.m. show. >> i'm taking over the 10:00 a.m. it's the cramer hour, not the eisen hour. >> that goodbye speech,

president of columbia university, not unlike dean phillips who is running tomorrow. if he gets 4% -- >> dean phillips -- new hampshire at all? >> -- >> very articulate. >> he's articulate. >> i find kurt anderson was very articulate about bill ackman. >> if he gets 1%, it's a big win. >> biden is not even on the ballot in new hampshire. they've got to have him written in. dean phillips is. >> i keep thinking about gary hart in 1984. the word was, wet don't care what number we get. it's a huge win. 7:00, it's a huge win, jim. don't we care about -- no. the results don't matter, you idiot. that's when i first learned that you never let the facts get in the way of a good story. >> we'll keep a close eye on dean phillips. was rtx a win or not?

>> i liked. >> it guidance for free cash flow seems to be ahead. we'll speak to greg hayes at 10:00. >> you want to know the entering thing of why the stock is up? the gtf, the engines. looks like the problems are much less than expected. >> not for spirit airlines. >> spirit is still in the sky? >> actually that stock has come back a good amount. >> because people believe they're going to win the lawsuit. >> no change to the gtf replacement plan. >> that's what i'm saying. people thought it might go up to $4 billion. turns out to be less. collins, fantastic, the f-35 is doing great. black box, we don't know. can't get a handle on it. i will say this is greg hayes' last quarter and he's going out on a high, not a low. >> we'll talk about what united said about the max-10. china reportedly considering a rescue package to help the

country's struggling stock market. jim, we know what the fxi has done. jack ma buying baba? >> these stories are for americans. people have a lot at stake. they're going to say this is your chance, you've got to buy. it's going to work. it always works because we're suckers for the prc. we believe the prc is all powerful. i guess we think the prc is saying taking them all off. i know they're dismayed that they're down as much as japan is up. david, the traditional strategy is to fool america, get them to buy stock and slam them in the face. it's much more of what mao might have done if interested in the stock market. >> perhaps true. reports this morning, in case people missed it, have been citing the fact that chinese authorities are aiming to get

278 billion -- >> -- >> -- companies to invest in the domestic market. >> there's a $700 billion whisper number out there. >> 700 billion? >> yeah, whisper number. i got the whisper number before i got the real number scombl we must take powerful and effective measures to stabilize the market. that's hat the chinese premier said, rolling out measures to stabilize what has been a very poorly performing stock market. >> futures, individual stocks? what do you think they're going to do? >> i don't know. >> take 5% of baba, get that sheehan deal going. >> anything can help to a certain extent. we talk often, almost every day, about the state -- you see jack ma buying morally baba. we talk about the state of the chinese economy. the property sector continues to

be a complete mess. there's expectations that housing markets are going to continue to decline and housing prices will continue to decline for the next couple years. you have deflation overall as a real concern. it goes on and on. >> you don't think this is the beginning of keynesian economics where they're finally putting money in people's pockets? >> many investors have been waiting for that moment that they would take more substantive actions to stabilize the economy and/or the property sector and/or the stock market. >> carl, the sheehan deal is coming. it must work. it just has to. the last ten ipos have been for 25 million. that's not acceptable. they need to raise more money here. in the end, they're calling the bottom based on nothing other than the fact that they're big enough to call the bottom. it's fatuous and it fools you. i'm waiting for the analysts to come out today to say this is the bottom.

because they're frauds and charlatans, but they have to play the game. >> bofa held a china capitulation call last night because so many names were down on china last session. >> the chinese have done this before. i remember when president xi came in at the exact right level, had a double bottom. he's got it right. it turned out, david, he's looking at the ad line and the rsi. he nailed it. he did. every one of those he nailed last time he came in. he had the rsi, the ad line. he had everything but the -- >> speaking of charts, we're going to talk about bitcoin and what you've been saying. >> oh, i got a little on that one. >> really? >> how much -- last night? >> the etf? i don't know. >> they doubled the amount betting the numbers would come in, and the numbers are so

bad -- >> it's a tease. you've got to do it next. it's a tease. >> the results might surprise you. >> i'm the pebble. i'm the pebble. >> i don't even know what that means. >> we've got the rock coming. >> yes, we do. >> dwayne johnson is going to join us as he joins the board at tko reshaping the wwe and ufc. trying to get traction on futures. we'll get to j&j, verizon, lockheed martin in a moment. ♪ ♪ every day, businesses everywhere are asking: is it possible? with comcast business... it is. is it possible to help keep our online platform safe from cyberthreats? absolutely. can we provide health care virtually anywhere? we can help with that. is it possible to use predictive monitoring to address operations issues? we can help with that, too. with the advanced connectivity and intelligence of global secure networking from comcast business.

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home of the xfinity 10g network. verizon rallying in the premarket. earnings in line with estimates. it's the post paid ads that really impressed. >> yeah. one other thing that's worth taking a look at as well, but you're right. relatively strong results. on that they did beat on subs in terms of, again, post paid

additions to wireless subscribers. pretty solid guidance. what else can we tell you? business phone subs continue to grow at a solid pace. you can see the stock is reacting positively. what caught my eye is something we've been watching for quite some time. there you see it. fixed wireless as a competitor to broadband to the home. take a look at that number. 375,000 net ads in one quarter for verizon. we've been focusing on t-mobile which has been active in this area in terms of providing fixed wireless, access to subscribers to replace at-home broadband. they've got over 3 million now. they want to get up to as much as 5 million. they're ahead of schedule in terms of doing that at verizon. you can see the post paid phone net ads of 449,000 which was also strong. keep an eye on our parent company stock, charter. there's definitely competition going on here. we made the point in the past,

as has mike sievert at t-mobile that ultimately they're capacity constrained in terms of providing fixed wireless broadly because you want to use your towers and capacity to provide wireless service to customers. it's more profitable. so if you fill up with wireless customers, you can't provide the same speeds for fixed wireless. right now, jim, that's a big number. >> what's just as good as that big number, david, do you know they bumped prices multiple times in the past 12 months. remember how we used to see prices go down? multiple prices up. not only is the dividend safe, it can go higher. i want to apologize on verizon. i didn't think they had this pricing power or this many additions. i'm impressed. i see now what they can do. it is darn impressive.

>> i hear you. i hear you. we'll keep an eye on shares of at&t as well which has been pretty competitive on its own. >> you know what i call verizon -- >> don't forget charter for spectrum, comcast, our parent company, also very active in wireless as you sort of see some convergence. you've got the phone guys offering broadband into the home via fixed wireless and the cable guys offering wireless. >> i think verizon may be the rock of telecom. >> you think so? >> yeah. i'm shocked. >> 20-year verizon, enough. put up a 20-year verizon versus t-mobile. >> i may use the word that jamie dimon used -- >> oh. >> that word, yes. cfo saying there might be

pressure this quarter. >> still to come -- >> -- >> -- jim said, dwayne johnson will join us live to discuss the move along with ari emanuel in a cnbc exclusive. take a look at the premarket on this tuesday. nus.be iunr n te mite maintain our financial strength and stability. and deliver solutions that meet complex needs. massmutual. partnering with financial professionals, benefits brokers, and institutions.

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let's get to a mad dash and we'll have an opening bell three minutes from now. >> i keep waiting for theclean quarter from mike roman. >> the ceo of 3m. >> exactly. but then we got a downbeat forecast. so many divisions, organic sales growth for safety and industrial

flat to low single-digit. health care or getting sales growth flat. david, some of the things -- the auto build slightly negative. consumer not that strong. it frankly is something that people are let down by. i think they're being a little harsh. i don't think it should be down as much as it is. they're putting behind combat arms, forever chemicals. i think people will regret they sell this thing. >> you do? mentioned obviously the litigation that has colored a lot of people's opinions, whether it's pfas and the groundwater pollution or the combat arms. >> combat arms is going to be behind them. i think that matters because it's veterans, terrible thing with hearing loss. >> they've settled on all those fronts. >> the outlook wasn't that strong. the health care spin -- mike roman is getting his arms around

the problem. that's kind of where i come down. >> okay. he will be joining us in the 10:00 hour. >> you have him? >> yes, we do. >> you've got mike roman. >> why am i not on the 10:00? >> you are on the 10:00. >> remember, you're taken over the hour. the eisen hour. >> i have three things i want to talk about now. >> okay. >> that's from the eisen hour. >> you mean at the top of the show. >> general eisenhower. >> jim, whether it's p andg revenue light, the ge guy, are industrials cooling off or not. >> there's an inflation problem with ge. procter is a -- [ cheers and applause ]

let's get the opening bell on the cnbc realtime exchange. at the big board it is tko, ari emanuel, members of the board and new board member dwayne "the rock" johnson. at the nasdaq it is spencer capital firm gdb capital. we haven't mentioned dow 38k or the notion that transports he thinks were ratified in some dow theory. >> i'd like to see csx tomorrow, union pacific the next day. those all matter. my instincts and sources tell me they will confirm, too that ed is going to be very right. >> united is going to help today, these results. despite kirby on squawk saying

we're going to have to plan for a scenario without the ten. >> i thought it was interesting i didn't hear kirby say anything good and the stock will go up. no, nothing is good. all right. we'll take it up two. >> business travel is coming back. maybe that was the key. by the way, kirby handles himself so well that even when he was slacking boeing, he seemed like a gentleman. i would never have played it the mother teresa way he went. he was amazing. all within the confines of saying, what a bunch of idiots. >> take a listen to what kirby told the guys on squawk. >> we're boeing's biggest customer. they're our biggest partner in the world. we need boeing to succeed. i have a lot of confidence in the people at boeing, great mechanics. they've had manufacturing challenges. it needs to be real action.

>> that's like i really have tremendous faith in the people who run china, but the people who run china, they're a bunch of mall fonts. i have faith in the people that play for the eagles, but it's really the management. it's like this really. they don't know how to do it and maybe they need a change. he did not call for that. >> no, that was fairly strong. you got his point. i don't think he was mincing words. he said they've got to get it together when it comes to manufacturing. >> he didn't name names. he didn't say there needs to be a change at the top. >> that's not his place. >> they need more focus. >> that's not his place. >> it would have been your place if you were running it. >> it's your place. >> it's definitely my place. >> we leave that to you, jim. >> are you calling for a change at the top of boeing? >> a bunch of popcorn on his head. >> can we make a headline? do you think it's time? >> no. everyone expects me to say something like that.

it's not even news. >> you won't even do it. >> the only time i made news is i asked clark hunt about taylor swift. i made news. i'm going to ask the rock about taylor swift. >> united leading the s&p. maybe his comment about business travel taking a, quote, step up. david is convinced that the business traveler may not come back because of work from home. i think you were probably pleasantly surprised that maybe business people are getting on planes. >> travel has come back a good amount. again, you do question whether it can ever come back to the levels we saw in 2019, but certainly people are traveling for business. >> yes. that matters, because they sit up front. you know how the fat cats sit up front unlike those of us who sit in the back. maybe i'm not back there, but still you get the point. >> i do want to get back to the huge story yesterday. stock down so sharply on the cfo

being placed on administrative leave. a little followup for me, not too much, but a couple of things. obviously some question, well, this voluntary request of documents from the sec. why? we don't know. i still don't know. was it a whistle-blower? might have been. the company doesn't know. they do a lot more data mining with the sec i'm told. does that result in more document requests from the sec? whatever it was, obviously it did bring about this request, this administrative leave. of course, it is intersegment transactions. i think archer daniels will be happy to let people know it's not changing -- >> the revs aren't going to change? >> right. the numbers may not change. >> the only other thing i have is there's a hope they'll get this done by the end of february when they're expected to file their 10k. >> the sec comes after them for

months and months. then they issue a release where it says these guys are bad guys. they issue a correct release a few days later. >> you can see the damage done yesterday. it's pretty extraordinary based on what was a press release. >> i think second worst day since the early '70s as i recall. >> i notice, by the way, i had george kirsh on from crowdstrike. he was commenting on the fact that microsoft issued a release after 5:00, a few lines about a very bad hack. >> and their employees. >> also senior management. he thought it was a kind of thing he didn't expect, that a major company like microsoft would wait until after 5:00 when people were going home, a russian hack that, by the way -- >> jim, people are looking past the guidance, a tweak higher and focused on the miss. orders up 35.

nice note by citi about how mortgage apps are rep nexting positive. >> it got up because of lennar and toll brothers. i think you've got to give it a day or two and you can come back and buy it. the order miss, earnings miss, net income decrease, backlog down. backlog down 11%. the orders up 35. people looking for 40. my problem with selling home builders, if rates are going down, you don't want to sell. >> jim, one name we haven't gotten to i don't think is j&j. >> i'm ready for you. what do you need? >> i want to know what your thoughts are, stock down a little over 2% right now. >> medical device was very good. pharma was very good. we still don't have an answer to talk. >> right. the litigation related to the accusations that talc is a car sin engine. >> some of us were hoping there would be a settlement.

instead it's going to texas. that's what's hurting the stock. i know they don't want to hear me necessarily say that. i love j&j, but comparing j&j to the eagles, i just don't know what happened after the sixth game of j&j. >> so you stay away? >> until we get a resolution of talc, yes. i fear the plaintiff's bar, the plaintiff's bar will come after me if i say anything negative. only one guy in the plaintiff's barwould not mess with, and that is dwayne johnson. they will rue the day they took on dwayne johnson. oh, holy cow. i'm sorry. i didn't know you were here. >> jim, while they get mic'd up, really quick on bitcoin. you've been telling us the charts were prepping for a drop. now below 39k. this is going to be coming off 20% down. >> trying to make a stand here. the problem is that the value of bitcoin went up more than $400

billion in anticipation there could be a huge amount of money in. net, the actual money is about a billion. very disappointing. that's why it's going down. it's falling under its own weight. i call it number down. there was a great book called "number up." i think there's no way this this inning can sustain this level. >> other chartists who say support at 36. you buy that or not? >> you can support it for a couple days, i'd say might be until detroit win -- >> is that going to happen? >> yeah, debo is not 100%. >> best monday night football ever. >> stroud is an amazing story. i think lamar is incredible. the gm of the baltimore ravens is about as great as it can get. he's unheralded because he's not a self-promoter. i love the guy. >> beats the prior record for

mnf which was the prior game, the bucs/cowboys just days earlier. >> just wait until we see -- i think this chiefs/ravens games will be monumental. the two best quarterbacks. it's going to be fantastic. >> are e with ready to get going? can we do it? i don't want to sit there -- >> we love watching. >> we thought we'd bring you guys on to watch us. >> he doesn't remember when i met him. the guy knows more about the stock market than anybody i've met that is a celebrity. >> let's introduce our guests here. they rang the bell just a moment ago. this on news that netflix will become the home of wwe's raw next year. also adding two new directors to the board, one of them sitting us now, ari emanuel, the ceo of tko and endeavor as well. dwayne johnson, actor, producer, entrepreneur and newly appointed

director of tko. thank you both for being here. great to see you and see you in person. >> good to see you. >> dwayne, let me start with the news this morning that has captured people's imagination which is the raw deal with netflix. give us some of the numbers behind this. the filing said over 5 billion over ten years. a lot of debate amongst investors, how much that's a multiple to your current deal. what can you tell them from a monetary perspective how significant this is and how many of an improvement it is over the previous deal? >> all i can say is we're in line with the mrashth's expectations of where our step-up would be. the only other thing i would say is it's netflix. they're the global leader, they're the best person -- best company with regard to sports entertainment, whether they've done it with formula 1, with tour de france. and this is kind of the next iteration as they go to live and

moving into live. >> are they going to move more strongly into live? >> well, you'll ask them post close -- >> we will. you have a sense of that. you just negotiated with them. >> i think this is an important step for them in their subscription service. i think live is important for them, yes. >> you said this is in line with expectations. clearly not. the stock is up 23%. >> i think the word netflix is actually very important for us. a ten-year deal with raw, it's a big deal. >> and they get a lot as well outside the u.s. tell us a bit more about this. >> well, they get the ples, they get smackdown. they're the global leader in s 5. for us it strengthens the brand on a global basis with that relationship. >> so you have peacock domestically for the wwe network. >> correct. >> that goes until march of '2. you've got ufc espn domestically

clue the end of 2025, and now you got this deal done as well. smackdown was done also -- >> smackdown, we moved it from fox to nbc. and then we moved also nxt to cw. >> so you're done for now. >> just for a moment. >> as your new board member says, yes. >> putting constraints on me. it's understandable. we've got to integrate a lot of stuff, as we've said, and do all the kind of -- we've done that on our marketing side, on our sponsorship side. yeah, we've still got a lot of work to do. >> dwayne, congratulations on the board seat. >> thank you. >> you talked about what a testament it is to your dad and your grandfather. >> right. >> it's unprecedented what you've done from becoming an athlete performer to this. >> thank you. it has been unprecedented. i think this move for us, for those that don't know, ari

certainly knows this, my grandfather wrestled back when wwe was the wwwf. my dad wrestled. my grandfather and my dad never would have thought something atlantic this would happen. then, i was able to sit at this table now and that is a table they helped built. i want to take a moment to acknowledge this guy. no ceo in the world like this guy. we've done a lot of business together. these game changing deals he's making as a reflection i think of who he is. when it comes to netflix, i'm excited. 52 weeks live. that's a lot of rock raising the eyebrow every week. we're excited. >> dwayne, again, congratulations on your success. >> thank you, jim. you gave me a book years ago, by the way. i appreciate that. you signed it to me. >> well, you have a fabulous

businessperson and you know many great things including the stock market. i find that this spring football is a fabulous thing. as you say, these are guys who play for dinner. we have too many players out on the field who don't play for dinner. when it gets time, they say for who, for what, when they don't have to tackle they walk away. you have seeing tremendous success, players going from there to the big leagues. i want to know, are these guys who might be doing absolutely nothing because they're thrown away after they get cut. this is a way for these young men to have a second career. >> that's right, jim. it's a great opportunity for these players. i always like to say, as you know, there's 53 men on an nfl roster. i was always number 54. d.j., you're good, but if you have a little more time and experience, you might make it. this is where your dream ends. >> the ufl creating opportunities for these players.

ari knows this as he's come to these games. you find these guys when they lays up their cleats, put the helmet on, put their hands in the dirt, the reason why they play and the reason why they leave it all on the field just becomes a different thing. they may not be making 40, 50, $100 million deals. but they're playing for their families, playing to eat. it's a different kind of hunger. >> that's why i love watching them. i always root for certain guys. i like daily fantasy with draftkings so i can bet on who is going to do well. i like to do that during the pro season. i also want to compliment you. i owned a bar san miguel. i had to give it up. the first company that actually treated me like an important person, a small bar in mexico -- mexican restaurant. i don't know whether these people, you've instructed them to treat small business people equal to large business people.

you were graceful and gracious. and that's winning. >> it's very important -- thank you for saying that. it's very important. a business is a reflection of its founders. in this case with tear ma manna, we wanted to build a tequila company to make some impact. we ended up shattering all records in the tequila space which is wonderful. the second word is mana and that spirit that comes from here. thank you for acknowledging it. i appreciate it. they're all fired, by the way. >> i had a life sized cut out of you in front. i crushed it. you know who you crushed? >> who is that? >> clooney. >> i think he did okay, too. >> he did okay, yes. >> part of this is you taking full ownership of your name. the rock name, what does that

allow for. what does that mean? >> there's a business side. there's the economics and the mass side of that. also, it goes much deeper than that. this idea, the name of the rock, for me, i owe that name everything. without that name, there would be no wrestling career, no hollywood career, but also that name was a derivative name of my dad, rocky johnson, who was one the first black tag team champion in wwe, trail blazer, paved the way, man of color, for a kid like me to be embraced in a bigger way when i came along. so this is one of the reasons why this deal is so unprecedented, the one i was able to do and come with ari here. again, i want to acknowledge ari, because at the end of the day he had a million reasons to say no, but he found the reason to say yes. the reason why is because he understood as he told me face-to-face, this is your name. it comes from your family. that's important to me. so family is very important to

us. the name the rock, this is why it becomes invaluable. the street valuation of the name "the rock" -- >> it's significant. >> more importantly than that, it's something that i earned, built and owe so much to that wild lunatic called the rock. i told him this last night. the greatest benefit of completely owning the name the rock, no gimmicks, no bs, across the board, full ownership. the name the rock a few years ago allowed me to be me. that's very special. >> the softer side of ari emanuel. >> the world is watching. >> back to the netflix deal again, just to get your perspective. linear tv. we talk about it all day. sadly we're one of them right here, although we do great. what does a deal like this mean for that? >> we just saw two weekends ago on peacock how big football played, 27 million people. i don't think linear is going away. i don't think cable is going

away. but there is a push to streaming. on this deal, we did that early on with the ufc on espn and plus. in our perspective this is the next iteration of where this will go. we have a linear play with smackdown and with nxt. this is the streaming play. for us it was the next step. it's a great deal for netflix in our opinion. they get 150 hours of programming, over $5 billion. it's like 2, 2 1/2 movies for 150, and for us it's the global player in streaming. so it's a great deal. >> let me follow up with you as well before we get back to the rock, ari, silver lake is trying to taken defer private or at least had said they're making efforts towards it. is there anything you can tell us at this point in terms of those efforts? there are some investors who

believe this is taking a bit longer than they might have anticipated. maybe they're having a harder time or taking a while to raise the equity. where do things stand? >> i'm really ashamed of you. it only took ten minutes to ask that question. i thought it was going to be the first question. but as you know, i can't a thin >> nice build up. >> i can't say anything. >> not even one little thing? >> not one little thing. >> how about you? >> say anything. no, i can't say anything. >> i'm curious on the distribution part. i think the last time we had you on was during the strike and you were trying to get people to the table together. it's amazing what the business has gone through in a year. does netflix, the -- what's happened in the playoffs with sports has it changed your priorities when it comes to distribution? >> in what way? >>, for instance, you're working on smashing machine. you have may 24 stuff going. is your calculus different now about where you would want to see it placed in the

distribution channel. >> of course. you have your finger on the pulse of what's happening. things are happening so quickly and rapidly, and it's constantly evolving and it's constantly forcing us to figure out where is the best home for the particular project. >> you know, i would say to you, there are movies that are supposed to be theatrically released and then movies supposed to be streaming, and that is the conversation we have and we have with all our clients on the representation side all the time. can it go to the theaters or is this best served in streaming? that's just a process that you go through all the time. it's the same thing r you going to sell this to a linear player or streaming player in the television business. >> is it about imax, scale and grandeur like "oppenheimer." >> no. it's what you think is a

theatrical movie that has the reach of that project. >> audiences can enjoy it in the theaters but does it have the ability to draw butts in the seats. we're finding offer movie like "oppenheimer" which completely took over all the oscar nods this morning, congratulations emily blunt and everybody there, but also that was a movie, if you think on paper, it's going to be a tough sell. feels like it's going to be a tough one. i don't know how big of a bet we're going to put on this one, and then all of a sudden does a billion dollars and sweeping the oscars and it was an incredible experience in theaters with christopher nolan leading the charge. that's how unpredictable things can be. >> i'm not sure about that. >> in what way? >> because when you're in it, i watch you. i think you're about to dot most bankable i watch and if i knew disney had done a ten movie deal with you, that stock goes to 120. that's what disney lacks. they lack the family fun you bring. yes, i am flattering you because my wife says --

>> thank you. >> dwyane is on and we watch it. i end up watching it even when i didn't think i should. why? because you are the family fun guy. >> jim, i will say the following, he's doing smashing machine and guess what? we're in conversations for a couple situations at disney. >> at disney. >> i want disney stock, my travel trust owns it f it goes to 110, not because of nelson peltz, but because of dwyane. you represent something about our country that everybody wants to win and you win in a way, look, it's not like a shoot em up. a lot of things i can't watch with my kids and my wife. when you're on, everybody watches. i want to compliment you. that doesn't happen. i know you must demand that it cannot be just -- you're not going to be in "scarface 2". >> no. but thank you for that. i really appreciate that. in a great position where we can in many ways call the shots but what a responsibility it is for

us, people will pay their hard earned dollars to get to theaters, you want to send them home happy. that is truly the bottom line. send them home happy. >> another responsibility is being a fiduciary on a public board. your first time on a public board? >> first time. >> you have to hold him accountable, right? >> i do. yes. i have been. >> so are you ready for it? >> i have been holding him accountable for 20 years. he's been holding me accountable. >> any expectations in terms of serving on a public company board, given it is a new experience for you? >> i'm excited, and i'm always looking to grow. i like to say i'm a builder of things and enjoy building. sometimes they work, sometimes they don't. something like this, everything that i do do, and everything that i do touch, there is usually -- not usually -- 100% is a deeper meaning to it. so joining this board, i have been asked to join other boards in the past, joining this board was unique and different and special in that, again, i'm sitting at a board that my grandfather and my dad helped

build and also helped build a company and growing it globally with a global footprint with a guy i love and admire and love building with him too as well. >> the funny thing is, the family tree that he has, and he said it recently, wrestling built him, he also built it. his family built it. that tko and his family can come together and their branches meet up now, so special. >> how is that silver lake deal going, ari? >> i can't believe it. >> look at the time. >> guys, all right. thank you so much. >> thank you very much. >> ari emanuel and dwayne "the rock" johnson. it's been a pleasure. >> thank you. we are getting breaking news on boeing and we'll get to phil lebeau. good morning, phil. >> carl, we have a response from boeing to the comments of scott kirby, ceo of united this morning. he told us his disappointment because they have so many maxes on order, the max 9 grounded, now boeing with a response to mr. kirby's comments saying we

have let our airline customers down and are deeply sorry for the significant disruption to them, their employees and their passengers. we are taking action on a comprehensive plan to bring these airplanes safely back to service and to improve our quality and deliver performance. we will follow the lead of the faa and support our customers every step of the way. that is from the ceo of boeing commercial airplanes. we will have more "squawk on the street" right after this.

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. good tuesday morning. welcome to another hour of "squawk on the street." i'm sara eisen with carl quintanilla and david faber and bonus, jim cramer hangs around with us. ahead of a big interview we have in a few minutes with the ceo of rtx greg hayes. take a look at stocks right now. dow under a little pressure, s&p has come back, gone positive and the nasdaq leads the charge against up 0.2% following, of course, the rally last week that continued into yesterday. kind of a number of sectors green this morning. tech and communication services have on top, energy coming back a little bit today. just health care and utilities under pressure. we're 30 minutes into the trading session, here are three big movers we're watching, ge

under pressure despite better than expected numbers after guidance comes in light. united in the green despite the news that company expects a quarterly loss of 35 cents a share due to the boeing 737 max 9 grounding. united states has 79 aircraft in their fleet and assumes they won't be able to fly the airplanes until february. china's stocks are rallying and regulators will step up an injection of capital into the market in an effort to stabilize the market and confidence. more on that in just a minute. actually, let's start there with china. this had a powerful effect whether chinese stocks were oversold going into it. the wore is they will spend $275 billion to prop up the stock market. this is clearly something the markets were hungry for, some kind of relief and you saw the impact just not on stocks, copper shot up, aluminum shot

up. will it do the trick? there's a lot of down beat sentiment on china, and its economy and market. >> it's fraudulent, not what you should do. i know they're not capitalists. if you want to manipulate the stock market count me out. i think the idea that stocks should go up based on earnings and how they're doing, not based on the fact that government thinks that market should be higher and they should be embarrassed and they should maybe look at themselves and rethink the way they do business. i think that this is kind of thing, sara, is disgusting and disgraceful. >> wow. >> really? disgusting and disgraceful? what if they came in -- >> we're -- >> what if they came in and supported the economy in the way many anticipate they would an and/or federal reserve has done in the past? >> that's not manipulation of a giant market. i think they should offer maybe a resolution trust for departments. maybe they offer, yes, low through an economic package, but

point blank say we're going to take the market higher, that's not what you do. can you imagine right now president biden said the stock market it's not up much, we have this guy trump, take the stock market up. >> the fed buys bonds. >> well -- >> there was a period where we wondered whether they would one day buy stocks. >> yeah. >> i think when you come in, what did we say, they're going to take the market higher because it should be higher. why don't they help the companies? why don't they deal with reality? what are they doing. >> do you think that's capitalism? >> it's not. but that's -- so what? >> okay. they're allowed to do whatever they want with stocks. do you think they sit around right now, do you think our chief economic adviser yellen are sitting down saying xi is down -- >> of course not. >> that's what they would do here. >> we're a capitalist country, market-based economy. >> you see, there will be analysts at major firms who need a lot of ipos coming from china,

who will say this is the bottom and people will believe in it and our people will lose a lot of money. they lost money in alibaba, and byu about to lose money in shein. >> to the larger point, this injection does give people the hope that they will intervene in other areas as well in china's economy. >> the proof is going to be there and your proof is a short-term injection in the stock market isn't the same as getting the fundamentals in shape and they're pretty ugly at this point. >> if they change the economics, they actually just really use their balance sheet to help industry, then you would buy the stocks because that could be the beginning of a turn. they're just moving stocks up reminds me of how fraudulent their stock market is to begin with. >> there was a reuters report they removed the draft rules for video gamers, which sent those stocks spiraling. maybe they're rethinking i think

the tougher regulatory agenda there. again, something necessary probably to bring foreign investors back in which is front and center and a problem for them. negative for last year in china. first time we've seen that in a while. >> when are they saying if you sell we'll arrest you? >> we haven't seen that yet. >> they had a lot of white collar executions a couple years ago. >> beyond china, the other big news story overnight that's moving the markets is the bank of japan. those dovish central banks on the planet, governor way da did nothing, still in negative rate territory, although he hinted if the wage gains continue, service price inflation continues, here's the money quote. we get further evidence that positive wage inflation cycle will heighten we will examine the feasible of continuing with the various steps we are taking under our massive stimulus program. the yen ralliedand jgb yields witness up a little bit on maybe the fact that they'll hike in

march or april. still they have not hiked rates and they are still in negative rates and why people have loved the nikkei. >> we are about to see a wave of acquisitions coming from china that -- from japan, china should do it. there's probably a 15 to $20 million deal in the works with japan. >> really? >> yes. >> with what -- american companies? >> yeah. >> buying japanese companies. >> japanese companies buying american companies. >> very much -- >> i pushed back on this and i will continue to. not saying there won't be some deals -- >> when this happens will you buy me a steak dinner? >> i'll look out for your health so i will buy you a vegetarian option. >> those are hard to get into, those places. try to get in there. >> animal spirits happening in japan. we covered it last year and continuing to this year. bullish. bank of america says investors still under exposed to japan. >> it's been wrong. >> and we wonder about the u.s.

as well and where -- we're going to get gdp. i'm excited for gdp on thursday and pce on friday. those are the big numbers. because it's been tough to figure out what the consumer is doing. we're going to talk to 3m, the end markets there on consumer, and on electronics have been weaker. then you talk to ralph lauren like i did last week, very strong demand. they're seeing optimistic for 2024. >> cincinnati's favorite procter & gamble which said we're not doing poorly. >> i thought you would say the pride of cincinnati, procter & gamble. >> no, it's kroger. i follow all of your companies an think they're important and wish the best of luck to joe burrow, but i think for once, mueller understood, maybe listened to our show and stopped talking about what was wrong and what was great. because the company is a great company, sara. >> here's the thing, they've had a lot of price increases over the last few quarters and years

and consumers are now that's it. organic volumes have declined. >> is that why beauty was bad? >> grooming basically saved date. they can't do as much on the price increases and volumes are negative so they're not going to get the growth they were getting. to your point, they're still getting growth. >> they are. >> commentary on the call was bullish, people are trading up to our brands. >> i thought that was fantastic. i am proud you have and proud of sflatsty. >> -- cincinnati. >> appreciate the support for me and cincinnati. >> i'm going to bring in greg hayes now. greg hayes, of course, ceo of rtx and the stock is just screaming. i got a couple of reasons why of course, but i want to hear from the man about why. greg, i cannot believe -- this cannot really possibly be our last talk together, is it? >> it will be my last earnings release before i step down as ceo of rtx.

but, you know, we've been doing this a long time together. i'm not going anywhere. i will still be around as executive chairman for a while. feel free to give me a call. >> well, i will. i was very gratified that today's release, the analysts are not talking about the problem you had, a lot of people are critical saying that you put a very low bar, going to be worse and worse, in truth, isn't this one problem almost behind you and not nearly as bad as you thought it might be? >> well, jim, i wouldn't say it's behind us. i think, if you know anything about rtx and the way we approach these issues, we tried to put a number out last september that we thought would more than adequately take care of this issue. it's going to take us a couple years to get through all the inspections and get through all of the mro activity, but what we have seen over the last few months the shops are coming up to speed, we're seeing a lot

fewer aircraft on the ground than what we originally anticipated. we feel good. there's no surprises here on gtf but a lot of work to do. give kudos to our airline partners who stepped up and working with us to try to minimize the disruption, given everything else that's going on in the airline market today. >> you know, i was always hoping we could just be commercial because collins was such a good deal and you made so many good deals to become a force, but we have to speak defense. when we do something right it tends to be one of the programs you're involved with. can you tell us the state of ukraine and what you could do to make it so that perhaps ukraine could do better? because i think you have it within your portfolio to make it so this is not a two-year stalemate. >> jim, it's really pretty simple what we need to do for ukraine. we need to give them additional weapons to support their air defenses. we put the patriot air defense system in. we have put in the short range

air defense. we've given them stingers and javelins, all the things out of inventory, but they're running out of missiles. whether it's the gen-t or n naysams they immediate nor munitions to counter the threat. until congress can act and spend some more of our hard-earned money over there this conflict is not going to end. we need to think about the ukrainians are fighting the war for nato and the only way they're going to prevail is if nato and the u.s. specifically steps up to the bar and helps them fund what they need to prevent more atrocities in ukraine. >> or what happens? >> well, i think, as we've seen over the last year, it's going to be a stalemate. this is world war 1 trench warfare with drones, and again, the drones pretty effective the way the ukrainians have employed them, the russians are starting

to employ them. this is going to be a long, bloody stalemate, absent infusion of additional weapons systems into the ukrainian battle space. i'm not talking about, you know, f-35 fighters or anything strategic like that. i'm talking about air defense missiles to protect the skies and the people. >> now let's talk about something that you have that if we could get more of, maybe it would help a lot of countries and also help shipping. talk to me about the program called coyote. >> so coyote is an interesting weapons system that was -- is in low rate production today. it's a small missile that you can mount it on the back of a pick-up truck or an atv. you fire it against a swarm of drones and it can take on a drone swarm either kin netically by hitting the drones or through high-powered microwaves by knocking them out of the air. the issue with coyote, low rate production, 40 going to 50, there's not enough of them.

what we've seen in yemen with the houthis is a constant barrage of i would say low-tech weapons and, you know, using gen-ts at a million a pop or sm 6s at $5 million a pop to take down $10,000 drones doesn't make sense. you run out of these expensive munitions. it's up to us, raytheon technologies, to ramp up the production of these and we're working closely with the d.o.d. to do exactly that. >> one of the things i'm concerned about, it did not impact you as much as it did ge, but i think you're still having a problem finding people and still having a problem with inflation. i wonder if the federal reserve is listening to what you're about to say and think we haven't won against inflation. we have not created the workers we need to keep wages down either. >> no, jim. this is an existential problem in aerospace and defense today, is the supply chain cannot find enough qualified workers to meet

the demand that we're seeing. you know, last year we hired about 24,000 people within rtx. added about 5,000 net. about 19,000 people leave. we're fortunate. we pay at the high end of the pay scale for these jobs, these are great jobs. the fact is, there is still a lot of pressure on inflation. last year give you an example, we saw $2.3 billion of cost growth from our supply chain and labor base. that's about 800 million more than we expected. the thought that the battle against inflation is over is, i think, misguided. i think this idea of cutting rates when you have 3.7% unemployment is also misguided. the fact is, we need more participation in the workforce and we need to get wages back to a sustainable level of increase. >> well, greg, it's david. how are we going to do that? >> well, i think we have to figure out, you know, what happened to the 3% of the working force population that went away during covid?

right. we were at 65% labor force participation. we're at about 62% today. that's a big number out of 150 million people or so in the workforce. we need to find ways to get those people back to work. the good news, if there is good news, the pandemic aid is, obviously, starting to fall away. i think people will rejoin the workforce. the wages are good. and frankly, we're willing to train anybody to do any one of these jobs. we have great apprenticeship programs, partnerships with community colleges, state and local governments. we need to get more folks back in the workforce and that is going to be a challenge. >> greg, forgive me for this in a way, to my viewers as well, but i remember a conversation we had a long time ago with you here regarding a potential presidential candidate at the time whose name was trump. seems very possible at this point that he will be the president a year from now, based on current polling and expectations. i'm curious what your thoughts

are, what a trump administration second time around would mean for your company, particularly given the theaters of war in which, obviously, you are one of the key suppliers? >> you know, david, we at rtx try to keep a bipartisan mindset in all these things. the national defense, defending democracy is our mission, really is a bipartisan activity. we can't choose sides between democrats and republicans. what i will say in a second trump administration, i think we have to continue to make the case why we need to fund nato, why we need to protect our allies in the south pacific and in the taiwan strait, and we're going to have to make that case with president trump if indeed he does come back because we cannot pull back from these relationships. the taiwanease depend on us, the australians, everyone. if he becomes president fully understand the consequences on pulling back on some of these

long-term strategic partnerships. >> it's going to be a little bit of an education there. this will be your last appearance. when president eisenhower completed his tremendous two terms, he gave us a speech about warning us about the military complex. have we gotten too far? is the military -- is industry so separate and military so separate, that we actually need to talk about the complex again? >> look, i think the fact is defense spending is around 3% of gdp today, which is close to an all-time low. given the fact that we're in the middle of conflicts around the globe i think we're going to have to rethink what our priorities are in terms of spending. clearly, you know, recreating as president eisenhower said the military industrial complex is not what i'm talking about, but what i am talking about is having the wherewithal to be able to have a credible deterrence to aggression. that means having the best

technology, the best innovation, and the best people focused on that mission. >> boy, i sure hope people listen to you because you have a strong view and your comments on ukraine should also be, i think, echoed in washington. look, i'm not saying i'm sentimental and we'll miss you, but you've always told us and i appreciate it very much. greg hayes, the man that put together rtx and carrier, all very successful, congratulations on an amazing run, greg. good to see you. >> thank you, jim, thank you, david, thank you all. >> we'll see you tonight and you'll have netflix to kick around. >> logitech which is important. i think that there is a resurgence in the pc. logitech is up a great deal before it went into this but we're going to explore that situation, peripherals and gaming. what a show. did a good show. >> and then? >> yeah. woi. very proud. thank you for letting me being on. >> thank you. as long as we talk about

cincinnati companies only. as we head to break here, the road map for the rest of the hour. shares of wwe and tko surging on news dwyane johnson is joining the board and a sport coming to netflix. find out why he's so bullish on the business, next. >> plus, salesforce's marc benioff is weighing in on activist investors. sara's exclusive or highlights from her exclusive this hour. >> and 3m shares under pressure as guidance comes in light. mike roman will join us to talk about the outlook for the company when "squawk on the street" continues. you always got your mind on the green. not you. you! your business bank account with quickbooks money now earns 5% apy. (♪♪) that's how you business differently. intuit quickbooks.

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jo i'm excited, and i'm always looking to grow. like to say i'm a builder of things and i enjoy building. sometimes they work, sometimes they don't. with something like this, everything that i do do and everything that i do touch, there is usually -- not usually, there 100% is a deeper meaning it to. joining this board, i have been asked to join other boards in the past, joining this board was unique, different and special that i'm sitting on a board my grandfather and my dad helped build and building a company and growing it globally with a global footprint with a guy i love and admire. >> that was dwayne "the rock" johnson who joined us last hour with ari emanuel, the ceo of tko, because he's joining the tko board of directors. the company announced that its

wwe "raw" will be leaving linear television and going to netflix next year. in a filing they said the deal is worth a little over $5 billion over ten years. a lot of different analysts and investors trying to figure it out. on our air, ari emanuel of tko, said it was in line with expectations, but that given netflix's presence, that in part is accounting for a lot of enthusiasm with which this deal is met because of its global reach and the like. that certainly can't be argued with this point, the importance as well of what was a property that was on linear, going to streaming. netflix moved deeper into live programming. also worth noting, of course. the presence here in international markets, canada, uk, latin america, optionality around some other markets over the next few years such as india and australia where they're unwinding the wwe network internationally. so that gets you closer to that $5 billion over ten years what

some analysts are saying. essentially derisks much of the business because there had been a fear, perhaps, the numbers would come in below or a deal would not be with a strong distributor as netflix. so you can see that. we're waiting on netflix earnings after the bell as well. subs there are significant in terms of expectations, carl. >> yeah. citi puts a bull case 135 on tko written before the netflix news came out today. we'll watch some of the upside scenarios for that stock. mean time after the break an exclusive you don't want to miss, co-founder, ceo and chairman marc benioff unngsodi off on activists, ai and a lot more in a moment.

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last year at this time salesforce was under heavy pressure by a number of activist investors. over the course of the year many backed down as the company substantially improved profitability and the stock shot up. i sat down with marc benioff in davos where he didn't hold back

about the activists environment, ai and a lot more. have a listen. >> i get a lot of calls from my friends who are dealing with activists. it's an industry, activists. activist investors are number one investors, they want to make money. they love money. maybe activist investors make and love money more than anyone i've ever met, so they're just money people. i think you have to kind of get that set right away. they're not going to want to hear about all the things you and i have talked about for decades. >> stakeholder capitalism. >> no. they want to hear about capitalism, but they don't want to hear about anything else. they only want to hear about money. and i think that's the first thing you have to kind of get your head around. that's fine. you know, you can just say they're investors. i think having investors is very important, and making investors money is very important, and then number two is, is that each one is very different. so each one of these personalities is totally different. >> you have a lot of them.

>> like calling me going let me tell you about this person. he's so nice. and -- >> it seems like you -- it didn't seem -- >> remember that, though? >> i remember. it didn't seem like it got heated or -- >> no. because i actually like them all. actually, i have a lot of really good stories, you know, about, you know, these activists. one funny story is, activists said, you know, your hair could be a little better and, you know, you should call my hair guy. and i'm like okay. and then another one is like -- >> wait. did you do it? >> i didn't do it yet. do you think i should? i don't know. does it look bad? >> no. your hair is great. >> thank you. >> number two is like one of them was super interested in meditation and, you know, i taught meditation and i enjoy meditation, i just did a half hour meditation before i got here, and like will you teach me meditation. >> yeah. >> i'm like, i'll teach you

meditation. so i brought them to my apartment, you know, and i was doing a whole meditation and all that and about 45 minutes into the meditation the activist is very teary and crying and emotional. >> seriously? >> i'm like it could be maybe a movie really. i think for a lot of them, you know, each one is different and they all require something a little different and that was a moment. that was nice. by the way, that was a beautiful moment. you know, that you can kind of go from a hostile situation where the first call is very -- they all want to be tough to the point there's a tear in somebody's eye. you know how i am. i think dealing with somebody's heart is the most important thing. if we can bring more love to the activist community i'm all for it. >> this is a story we needed. >> that's only two. >> the story that we saw is that -- >> six or eight activists. >> you improved margins, boosted

the stock price. >> yeah. right. >> we saw some of the strategy. the one you're interview -- >> we didn't just improve margins. our margins are up over 1,000 basis points over a year. our margin improvement is phenomenal. >> how much more is there to go on that story? >> i think fleece finish line for anybody when it comes to margins, so that's a huge opportunity. it continues to be a huge opportunity. you have to, of course, you know, realize we're in one of the greatest moments of our life with ai, so if you are taking a dollar into margin, you're taking a dollar out of ai research. you do want to have the right balance. i think those things are important. by the way, everybody understand that. >> that's part of my question, which is how you balance growth, which has been decelerating, sure. >> and profitability which you're ramping. >> our size and scale, i mean on the numbers we're way bigger than anybody else' growth, so people say growth is

decelerating. have you seen the numbers? we're saying we're going to hit almost $35 billion in revenue this year the third largest software company in the world, second largest in japan and who else is at this scale in enterprise and software. i like it when companies go we're growing a lot faster. >> we added your company on to our company this quarter. growth is relative. >> marc benioff. there's a lot more there. we got into ai, got into social media. you can catch the full conversation in a cnbc leaders double feature tonight. it's benioff and then the ceo of ubs sergio armani at 8:00 p.m. who has a tough challenge integrating credit suisse. benioff didn't hold back. wait until you hear what he says about ai and used the word, i thought this was interesting, maybe not surprising because he owns "time," but chatgpt openai stealing copyright information

in order to put it into their ai programming. we went pretty deep on that subject as well. excited for everybody to see it tonight if can't wait. 8:00 this evening looks great. >> i like that color on the activist. interesting to figure out who he was talking about. >> meditation. >> we covered it closely. first jeff smith and then -- i mean it went on and on and on. to your point it worked, too. >> right. i think they're mostly all out except -- >> yeah. plane of them may be out. the margins got better. >> yeah. meantime i think it was morgan stanley made crm their top pick yesterday effectively replacing microsoft as those top picks expire. meantime got some earnings names in the green this morning. s&p is holding 4850. we'll break it down with the former ceo of truist in his first broadcast interview since leaving the helm in a couple minutes.

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♪ ♪ ♪ ♪ ♪ ♪ i'm courtney reagan with your

cnbc news update. it's primary day in new hampshire and voting is under way. former president donald trump is hoping to solidify his front runner status while nikki haley is hoping her strength with independent voters can lift her to an upset. a powerful storm inundated san diego monday as intense rainfall flooded roads and homes and swept away cars. the national weather service says nearly 3 inches of rain fell and monday became san diego county's wettest january day on record. nuclear bomb drama "oppenheimer" produced by universal pictures led the way in oscar nominations securing 13 nods. box office competition "barbie" brought in 8 behind "poor things" and killer of the flower moon but greta gerwig was absent from the best director nomination. the award show march 10th. back over to you. >> courtney reagan. the broader markets in financials and believes inflation will continue to

moderate, quote, bullish on the banks at least. kelly king, former truist chairman and ceo joins us for a national interview since retiring from truist. great to have you back. good morning. >> thank you, carl. great to be back. good to see everybody. thanks for having me. >> yeah. a lot of water under the bridge since we last spoke. i think 30,000 feet broadly, you think the economy is going to jug along nicely here and normalize in some areas. talk about how you see the year unfolding from a macro point of view. >> yeah, carl, so i am clear that economy is solid and doing well and one of the reasons it is is a little bit misunderstood. if you go back through many cycles, cycles are created out of excess supply, creating a boom and then a bust. in '90s we had the commercial real estate, in 2000 the tech

boom and best and 2008 the financial boom and bust. this is different. we didn't have a boom but shut the economy off because of the pandemic. it's taken time, supply chains et cetera to normalize. when you get back to going you don't have an inherent excessive supply and demand and, therefore, the economy doesn't have to contract in order to allow demand to catch up with supply. i think you can look underneath all of that and what you see is a good, solid foundation. there certainly are a few pockets but underlying strength is strong and will continue. >> we mentioned your optimism regarding financials. how much of that is going to be yield curving normalization and how much do you think is going to be a return to activity in capital markets? >> carl, i think the yield curve normalization will be positive and additive for the financial

space. fee income, capital markets, mortgage income, all of that will rebound materially as rates normalize, which i fully believe they are on the cusp of doing, and so from a banking sector point of view, you're likely to see something like we saw in 2000. if you recall back in 2000 the tech bubble from 2000 to 2004, dropped from 5, 4, 3, to 1%, banks went up by 90%, while the nasdaq was going down 46%. so this market is set up in my view very positively for banks and overall very positively for the economy. i'm talking generally for the stock market. there are some areas in the stock market that are a bit exuberant and that will have to be washed out, but i don't think it's going to be enough to create a catastrophe in the market. >> kelly, it's david faber. i'm curious why you don't share

some investors' concerns about commercial real estate exposure, particularly office and particularly at regional banks, given the need for some of these owners to refinance at levels that are going to be untenable for them, hence the banks may end up with the real estate? why not a concern? if it is a concern why does it not rise to a level that would impact your overall view here? >> right. it is a concern, but it is a controlled concern, david. there's a lot of misunderstanding about the exposure in real estate and then the exposure in real estate in banking. first of all, the real issue in real estate is in large commercial office buildings. that's, by the way, not because of an excess supply. it's because of the dramatic reduction in demand, which is slowly coming back. some multifamily. here's the thing that you need to take into account when you think about banks. when i first started in banking in 1972, most of the loans in this country were held by banks

on their balance sheets. that has changed dramatically. now a huge portion of the loans, especially large loans, may be originated by a bank that they end up in a shadow banking system. so when you look at the average small banks, regional banks and the largest banks, you don't find huge concentrations of very large office complex buildings. they're often some indications and it's problematic for the aggregate economy but not problematic for the banks. so i do worry about that, but i think it's going to be controllable because it's so dispersed outside of the banking system largely. >> kelly, finally i got to follow up and ask where you think the potential is for maybe irrational exuberance in the market? we've seen forecasts lately about what, for example, the forward p/e of info tech and communication services might do in the years ahead? >> well, carl, i'm a bit conservative but i've been a

banker for 50 years so i guess i'm allowed that. but no, look, i think there are pockets of irrational exuberance. when you get some of these companies selling 40, 50, 60, 70 times earnings, people don't understand what that means. if you pay 50 times earnings, it's going to take the company 50 years to earn back that stock price, so it's irrational because what now is happening, in my opinion, is people are super excited about generative ai, which is good, but it's overstated. there's a common belief now that ai is going change the whole world and it's going to do it. it's not going to happen, in my view. it is important and it's a significant factor. it is not going to reduce human beings and it will be -- it will increase productivity but not going to change the world. >> we try to be disciplined about giving viewers occasional

gut-checks on those multiples. great to chat again. hope it happens more often. thank you. >> great to see you. have a great day. shares of 3m as you can see right there are down sharply this afternoon after there was a revenue miss and chairman and ceo mike roman is going to join us to break down the numbers and the guidance in caterpthe guida that seems to be giving investors pause.

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3m shares falling sharply after q4 earnings beat. revenue missed though as well. the company forecasting full-year profits below analyst estimates on slowing demand amid higher rates and inflation. mike roman joins us for a cnbc exclusive interview. good to have you. >> yeah. good morning, sara. thank you for having me on today. >> good morning. so what happened here? looks like so the organic revenue growth was a miss and

the guidance looks like some were saying was conservative or light. what are you telling investors? >> yeah. i would say, sara, there's a lot of discussion about the outlook for 2024. i would start with how we finished out in '23. we had a strong delivery of our q4. we improved our operational performance that showed up in our results. we had eps that beat our guidance and beat consensus. we had another order, a strong cash flow double-digit growth in the quarter and our revenue in the quarter was in line with what we guided. the total year similarly we executed well, delivered on commitments, exceeded our guidance or eps and cash flow, delivered 30% in increasing cash, for example, reduced our debt by $2 billion, so a strong performance and we carried that momentum into 2024. as we look at '24 we expect to build on that. another year of strong growth in margins and we will grow

earnings. we will drive robust cash flow and we'll see improving organic growth. the discussion was around how that organic growth guidance the we have for the year, 1 to 3%, exclude something portfolio actions, which is an important priority for us, it's -- i would say we're building on our momentum and we do expect a successful 2024. >> well, it is a little messy and you reference this because you are spinning off the health care business, right, and that's going to be factored into the outlook in 2024. you have these big settlements coming when it comes to all of the legal issues. so how much of that is incorporated in here, and if you strip that out, what does it tell us? >> yeah. we have three priorities we've been focused on recently as we came into this year and we'll carry those at in new year. driving performance that i have been talking about. it's progressing on the spin with health care. we're on track to spin out our health care business in the first half of '24 and continue

to make progress in reducing risk an uncertainty in related to legal matters. two settlements focused on taking to final approval, one in early february and another one later in march. so those are part of our priorities as we come into '24. in our guidance, we as we come into '24. again, driving growth in eps and improving revenue growth. we did guide it. the timing of the spin has an impact on how you would separate the two companies. it's not -- you can't just subtract health care from 3m. there's other factors we have to consider. we spend a lot of time with analysts walking through that.

that does make it complicated but it's a reflection on the things we know are creating value, those three priorities. focused on those as we come into the new year. >> as for growth, mike, is it just that some of your end markets, the consumer products and electronics and industrials are weaker than the broader economy? what are you seeing there? >> as we start 2024, i would say q1 looks a lot like q4. q4 we talked about some of the dynamics we were seeing. we had some strength in our industrial businesses, mixed in our industrial business in the u.s. notably we had a strong oem business in the quarter. we had soft demand in china and consumer retail. we saw stabilizing in consumer electronics, something we had seen negative growth in as we went through much of 2023. as we come into first quarter, we see a lot of dynamics

continue. the build rates are expected to sequentially flatten out. we continue to see softness in china and the retail markets in the product categories we play in retail where we have products in discretionary product categories. we carry that in. that's how we're looking at the year. there is an expectation the macro improves as we go through the year and that certain end markets will improve. i would say we're starting out the year with a view of q1 similar to q4. >> mike, as you said earlier and it's david, you expect 2024 to be a good year. your investors seem to have a different view of what good means. i'm curious as to how you would explain the deviation here. you got more than a 10% loss in your market value this morning. that being said, the stock had moved up sharply into this earnings. still your good and their good don't seem to be the same thing. >> i would say the focus, david, as we've been talking about is on the guide for '24.

growth is part of that. that impacts what you deliver in margins and eps. the eps was certainly a topic as well. i believe that we are -- we'll grow those -- we'll drive that execution, grow as we go into 2024. as the markets improve, we'll take advantage of it and deliver and leverage that for greater growth into our results. i do believe we'll continue to make progress and build off that momentum, deliver growth. the market's reacting to the overall outlook for 2024. we'll see how it plays out through the year. again, we're starting with confidence in our ability to execute and drive that improving bottom line and cash flow. >> yeah. well, to your point, the guidance perhaps below what many investors had anticipated. you do seem to be more positive, perhaps, in the second half of the year. i think i basically heard you say that and i'm curious as to why. >> well, i would say the macro

projections we look at show improving as you go through the year. i would say end markets more than the macro. that said, we were in the same place a year ago. we expected the first half to be cautious, some of the challenges in the end markets that i've been talking about. and the second half was going to get stronger. we diplomat see it play out that way. i would say as we come into the new year, we've been really focused on what we control, that execution, focus on what we know we can do. we do continue to invest in our growth. we invest in growth productivity, sustainability as priorities as we drive that execution. we leveraged some of that improvement into those investments. we are driving, i think, a very healthy pipeline for innovation. that will help us grow in the most attractive markets we're facing as the end markets improve, as the macro improves, we'll take advantage of that as well. >> i was going to ask, how you grow, how you can get top line growth if we don't get the kind of gdp improvement we need, or

whether -- >> and that's -- that's an important -- we talk about what we do, we use science. our technologies to make a difference in the world. we prioritize investments in the most attractive markets. we talked about a number of areas that are merging, like automotive electrification, climate technology, industrial automation. these are all investments for us where we see opportunity in our driving growth. our automotive electrification is now $650 million business, growing 30% in 2023. we also grow close to our customers. our innovation starts with them. we are always building what's next for them. our relationship with them allows us to see new applications, new penetration, highlighted one of those in our call this morning where we are a leader in workplace safety. we announced at ces a headset that was leveraged solar technology to reduce the use of

batteries and still enable that hands-free communication that that's so important in the workplace in difficult environments. we also talked about the progress we're making in the specifications we're winning in our thermal barrier technology for electric vehicle batteries, helping to improve performance, range, charging cycles and safety. that's an example where we're close to customers and we identify new areas of penetration. our pipeline, that is what's prioritized there. what we can win for customers, new penetration and emerging businesses we can build. those new businesses we can build. >> mike, we certainly thank you for coming on and talking through the results and the reaction. appreciate the time. >> thank you, sara. thank you, david. >> ceo of 3m. down 10%. i do wonder how much of an overhang the legal issues are, just until -- i know they have settlements, but there's no actual number of size and scope. >> and the ffast litigation,

other solutions in addition to the final approval for public water suppliers. it does get complex. mixed reaction to a number of earnings. gm down, 3m down, verizon up sharply. we got a lot more live market coverage for you. that continues after this break as well as oakmark capital's howard marks joining carl and sara. trading at schwab is now powered by ameritrade, giving traders even more ways to sharpen their skills with tailored education. get an expanding library filled with new online videos, webcasts, articles, courses, and more - all crafted just for traders. and with guided learning paths stacked with content curated to fit your unique goals, you can spend less time searching and more time learning. trade brilliantly with schwab. they're waiting for you. hey, do you have a second?

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good tuesday morning and welcome to "money movers." i'm sara eisen with carl quintanilla live from the new york stock exchange. oak oakmark's howard marks here on ultralow rates with more than $180 billion of assets under management. we'll get his outlook for the fed. the straw that broke the camel's back. the ceo of united airlines casting doubt on boeing. we'll break it down with oscar munoz. you'll hear from jamie salter from authentic brands. market