good morning. welcome to "squawk box" here on cnbc. we are live from the nasdaq market site in times square. i'm becky quick with andrew ross sorkin. joe is out today. it's a monday morning. here we go again. on friday, you saw the dow closing at record highs. you saw both the nasdaq and s&p breaking the six-day winning streaks. it looks like a mixed picture. the dow futures are indicated lower off by 25 points. s&p futures are flat. if you look at what is happening with the treasury yields, you see we have seen lower yields. the ten-year yield is below 4.1%. the two-year yield at 4.32.

this week will be earnings which are in focus with the geopolitical headlines. let's talk about the "squawk planner." we have a lot on tap. the fed kicking off the two-day policy meeting tomorrow and the rate announcement on wednesday. we get the read on home prices tomorrow and jobs week in america. adp private payroll report on wednesday. we get job economic numbers on thursday and the january employment report due on friday. a lot of busy stuff there. let's talk about earnings. tomorrow is when we hear from alphabet and microsoft numbers and adm and pfizer and u.p.s. on wednesday, we hear from boeing. we have united news over the weekend about trying to negotiate with airbus. qualcomm and mastercard. on thursday, amazon, honeywell, apple, meta and merck.

on friday, chevron and exxonmobil. and friday, i don't thknow if y know, the vision pro goes on sale. >> it does look cool. i'm not convinced that people will walk around wearing it. >> did you get the version one yet? >> if you are on a plane, that is good to shut things off. some other stories. alaska airlines completing inspections on the boeing 737 max 9 aircraft and resuming flights on friday afternoon. the airline expects all of the inspections to be completed by the end of next week. it will resume full flight schedule. the inspections take 12 hours per planes. and united is considering

airbus to fill the void left by the 737 max 10. united ceo scott kirby flew to france to talk about a possible purchase. a person familiar with the issue says no agreement has been reached. kirby said the company had been working on alternate plans. >> we are now best case five years behind on the delivery of the max 10. as we have gone through the years, we have grown increasingly to believe the max 10 is pushed further out. we have started working on a alternative plans. this is the straw that broke the camel's back for us. we will build a plan which doesn't have the max 10. we will build an alternative plan without the max 10. >> we asked him directly if that was airbus and he demured at

that point. this seemed like the clear alternative. kirby did say they will not reach growth plans in terms of what they have been promising the street because of the delays they had with boeing. by the way, later today, we will talk with ryanair cfo. he has been talking already this morning if there are extra boeing planes around, they would be happy to take them. clearly all of this is setting up for some sort of an issue -- >> detente. i want to hear on the earnings report, but also guidance to the extent of conversations like this and are they worried? i don't know how much clolor we will get. >> it is a closely watched report with the tech names. it is a big name on tuesday and

thursday. and nikki haley is vowing to stay in the republican presidential primary race through super tuesday. she told "meet the press" that she needs to do better in south carolina than in new hampshire. she criticized the republican national committee over a plan that was floated and then dropped to name trump as no, ma'am enominee. we will hear from haley here on the set coming up. and tko group vince mcmahon has resigned from the company and no longer have a role with the company. this comes after allegations were made on thursday of sexual assault and sex trafficking. mcmahon denied the allegations, but resigned out of respect for the business. allegations were filed by a former employee who alleged

mcmahon directed her to have sex with other executives. she says mcmahon agreed to pay $3 million as part of the deal, but only paid per $1 million. tko and netflix announced a long-term part to bring "raw" to the streaming service in 2025. this raises a lot of questions because, of course, the deal was made with ari emanuel's firm. this is a bigger question and until this deal gets done about the original transactions and what diligence was done. if this deal was made in 2022, which was within 12 months of the other deal being made, did they know? was that acceptable? it is an interesting dilemma and

conundrum. >> i would be pricedsurprised i knew. >> there is also the clients part of the wwe world. this is where it gets super, super duper complicated. >> sordid details. breaking news overnight from china. shanghai plan will reform institutions. the news story has been removed from the web site after posted and no longer available online. separately, the securities reg regulators would halt shares of short sellers today. it will not lend out shares during the lock-up period. strategic investors refers to holders of restricted shares.

shares of evergrande halted after plunging 20% in hong kong. a hong kong court ruled to liquidate the property developer after failing to reach agreement on restructuring. let's get to the developing story in jordan. three u.s. troops killed in an attack with the unmanned drone attack near the syrian border over the weekend. 34 were wounded early in the morning. president biden blamed iranian-backed groups for the attack. keir simmons is joining us from amman, jordan. keir, we are watching this situation closely for escalation in the area. >> reporter: that's right, becky. the escalation is the crucial part of this situation. for those servicemen and women who lost their lives and families, a terrible weekend. there is also the deep concern

now that this was iranian-backed militia responsible for this attack. the president, president biden, vowing a response. we already know that the u.s. is locked in a confrontation with the houthis and other ira iranian-backed group in the red sea, and now this attack. the deadliest attack by fire on u.s. forces in this region since the october 7th attacks in israel and the hamas-israel war in gaza. the question now is how the u.s. is going to respond. one of those tweeting overnight saying hit iran, hit iran now. of course, the question is exactly what that kind of action would involve because i mentioned the strikes against

the houthis in yemen with multiple examples over the weeks and so far it hasn't stopped the houthis from attacking on shipping in the red sea. where this happened here in jordan is right on the border of syria, iraq and here in jordan. it is a base called tower 22. a group of islamic resistance in iraq are saying that it hit bases in syria and in jordan. not counting tower 22 as one of the bases it said it hit. it does appear that the spotlight, accusation, if you like, is very much on that group. again, that will then track back to iran. the iranians, becky, saying they do control this group. they don't issue commands to this group. they certainly do back this group. again, that is where the focus is going to be through the day on iran and whether iran bears responsibility for what happened

here. >> keir, there needs to be a public response. president biden has admitted that as well. what are the range of options they could take on because not only is this a situation expanding things in the middle east and region, but also over the weekend, it seems like it is not helping in terms of the peace talks or cease-fire talks taking place in paris. both sides were far apart over what's happening in gaza. >> reporter: it is a three dimensional jigsaw with the talks. our understanding is the talks have made some progress, but deep questions over whether or not israel would be prepared to call for a full cease-fire as ho hamas is demanding. hamas clearly isn't going to get the release of prisoners it has been hoping for here. so far, it has not through these

mediations if you like to persuade the israelis for the full cease-fire and now this. what we see in jordan is what people worried about with the danger of escalation as long as all of this continues in the region and this is it. the three u.s. servicemen and women at thfatally injured. that is the kind of thing that will mean the biden administration has to respond or feels it has to respond. in terms of what it can do, everything from attempting to target this group wherever it is inside iraq and inside syria, but also to potentially and this is what republicans are calling for, targeting inside iran. of course, the issue is with the

houthis and if you do that, what is the extent of that action? does it stop iran from supporting these groups? if not, is it symbolic? >> keir, thank you. keir simmons from nbc. we appreciate the update. coming up on the other side of the break, the fed kicking off a two-day policy meeting tomorrow. we talk to former fed vice chair fer roger ferguson next. we will also talk to lina khan. "squawk box" is coming right back. ailored 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.

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welcome back to "squawk box." the fed is kicking off the two-day meeting tomorrow. we have roger ferguson with us who was the former vice chairman with the fed. roger, it is great to see you. >> nice to see you, andrew. >> you got a new view with the numbers we have seen so far. is this pushing things out? how will jay powell lower interest rates in your world? >> in my world, it is the second half of the year. for me, that is not a new view. we have seen the economy which is still strong. the last gdp print surprised a bit. the good news is the pce print suggesting the disinflation process is under way. there are concerns that a few people might have with the

turmoil in the middle east might lead to pick up slightly in goods inflation. the service sector is still a little hot. the second half is my bet at this stage. i think the market is starting to come in that direction. >> is that a three cut situation or two cut situation or a one cut situation? what are you thinking? >> i'm thinking it may be three. the issue is inflation looks like it is moving in the right direction. they have no need to stay in restrictive territory with the real rate minus inflation. you know, i think squeezing three in the second part of the year is still my base case. certainly not more than that. possibly less if things slowdown. that is where my head is right now. that is not a dramatic change impo for me. >> you can answer this question with more authority than anyone

on the station. end this debate. you know where i'm going with this. we have a lot of people who have come on and said it is very difficult for the fed to start lowering interest rates in a presidential election year as you get closer to the election itself and that weighs on everybody and it is part of the conversation. therefore, they may not do these things or want to do these things before that. you had the job. take us inside the room. does the presidential election become part of the actual discussion itself? >> i've never been in the room when the presidential election was part of the discussion itself. i can't speak to what's in everyone's mind, obviously. think about it. if they cut early and it proves to be the wrong thing, they find themselves raising rates in the election year. if they delay, they find themselves losing the possibility of getting the soft

landing within grasp. the end of the day, following the economics is the only thing that matters because that's how you get to the best outcome. if the politics gets in the way of that, the outcome looks bad. the logic is follow the economics and carry out your plan. that is the only way to stay out of harm's way. >> roger, nick timeros had an article that raised questions over what we anticipate the language change coming from the meeting. he doesn't believe they will cut rates because the economy has been steadily growing. it does raise the question whether they will ditch the idea about the most likely scenario being that rates would rise from here. do you think that is a reasonable way of looking at things? easing your way out to open up the door for potential interest rate cuts?

>> i think they will have to acknowledge that inflation is coming down closer to the 2% target. con consequently, that gives them room to move rates lower. i think they will guide as softly as they can in the second half of the year. they want to keep in place the 50/50 in march and try not to raise expectations of the earlier cut. it will be walking a fine line by admitting it. >> talk about not raising expectations without signaling something like this. >> i think that's right. recognize what they will try to hint at a delay. i think in the conversation, chair powell will talk about the sep and other things that seem to put the delay or cut toward the second half of the year. it will be a tightrope for him. >> okay. roger ferguson, thank you for taking us through all this and

giving us the inside dope. thanks. >> thank you. when we come back, tax filing season begins today. oh, boy. we will tell you about the changes this year that could affect the amount you owe the government. "squawk box" will be right back.

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tax filing season starts today. the happiest time of the year. the first day you or your tax preparer can submit a 2023 return for processing by the irs. we have sharon epperson here. she joins us on what people should know to make sure to get a refund quickly or figure out what they owe. good morning. >> good morning, becky. this is the day everybody is waiting for. >> christmas all over. >> exactly. you have to think of things when you prepare to file taxes. the consideration is to claim the standard or itemize.

may take the standard now. in 2023, married couples claim $27,700. $1,800 than the year before. single filers can claim $ 1$13,. about 30% of taxpayers with incomes over $1 million or more took the standard deduction last year. if you are like most taxpayers, you will get a refund. a quarter of filers had tax due on the 2022 returns. the percentage was far greater for high earners. half of those with incomes over $1 million or more had a tax bill when they filed. missing espectimated tax paymen

has become costly with the rise of interest rates, the irs charges for under payment of 8% a year. that is compounded daily. if you file for an extension and don't pay the tax bill by april 15th, you will be charged a late payment penalty for every month the tax is unpaid up to a maximum of 25%. whether you want to get a refund quickly or owe tax, it pays to gather the w-2s or 1099s and other documents you need. i have an envelope on the dining table and i put things in there. am i going really do this by april 15th or will i do what i did last year and ask for an extension? >> you asked for an extension? >> i have to. i'm doing too many tax stories.

>> the 8% is a big number you are pairing. rate paying. rates have come down. >> it does change over time. this quarter, this is what it is. 8%. it is looking back at interest rates. >> that it is insane. you can get a mortgage for less. >> i know. pay your estimated tax. if you think you owe something, put something in. >> what impact could increase in your investments have on your taxes and return this year? we saw the markets up. >> exactly. people and wages for people up as well. that net investment income tax is 3.8%. that could likely hit you if you are above $200,000 for single filers and $250,000 for a married couple. the 3% tax which may not be on there from last year.

look at municipal bonds and if you are doing a roth conversion, do it over time. not in the same year. people may be surprised. >> i'm feeling better that you had to ask for an extension. gives me grace. thank you, sharon. >> sure. >> i don't know if i have done a year without an extension. >> really? >> in maybe 20 years. >> i've never asked for an extension. coming up, the ceo of ryanair is joining us over the issues with boeing and candidate nikki haley will join us on set in the 7:00 hour. we are coming right back. rylee! from rylee's realty! >> announcer: executive edge is sponsored by at&t business. next level moments need the next level network. and this must be the ocean view? of aruba? huh. this listing is misleading.

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good morning. welcome back to "squawk box." we are live at the nasdaq market site in times square. yes, it is still dark outside with the live shot of new york city. we are 14 points off dow. nasdaq opening 1 appoi3 points . s&p is up a point as we get ready to talk about airlines.

ryanair hiss missing the streets earnings expectations. the shares are moving lower after ryanair cut the profit guidance for the year after online travel agents stopped displaying the carrier. joining us right now is ryanair group cfo. ryanair is boeing's biggest customer outside the united states. thank you for being with us. >> thank you. >> let's talk about the guidance. what happened in the quarter to cause you to miss expectations and what is it that is happening right now with the online travel agents not selling tickets? >> sure. first and foremost, we had our best nine months at just under

$2.2 billion profitability from the prior year. we were soft eer than anticipat in q3. we had a headwind giving up 35% year on year per passenger. we anticipated the consumer would be up mid teens year on year. one reason for this is in early december with the unexpected development, but not unwelcome with the travel agents of ryanair flights took them off sale. we had an extended christmas and new year period sale. that would impact the load factor. long term, this is a positive development. we see the ota issue unwind at this point in time. we had a number of digital pirates for many years scraping our web sites and charging

unscrupulous fees to unknowing customers and not providing contact details to ryanair. things went wrong and there was a schedule change and delay and a cancellation that we did not communicate to the customer and we gave them back a refund. that situation is resolving itself. we have seen a number of the larger otas and holidays and kiwi this morning signing distribution agreements with ryanair with access to the inventory and not overcharge the customers and provide the contact details. this is positive for the customer, but ryanair brand because a lot of the most vocal complaints from the years is people who have not rbooked wit ryanair, but ota. positive short-term pain in the quarter, but long-term good for

the business. >> that makes sense. you have always been tough negotiators. i can understand why you would want to take the short-term pain. stock is down 1.25%. that necesgotiating mindset youe always in at ryanair is playing out today. i have been reading through the comments you have been making about boeing and the back and forth with united. you said united comments on the max 10 were stupid. you cannot wait to get the max 10. you would jump to the front of the line to take max 10 slots given up by united at the right price. you have been some of the toughest on boeing's ceo and the rest of the company for 18 months where you were unhappy until you got moved up and promised they would make deliveries. you were calling for calhoun to get kicked out and he was no longer ready for it.

now it is stupid that united is giving them grief? >> in fairness, becky, we are critical where criticism is needed. we give credit where credit is due. that is significant on the delivery front. >> a door plug blew off that alaska airlines. united has reason to bring up safety concerns. >> i agree. that is a concern for boeing. we have, ourselves, and people on the ground in seattle. i was there a couple of weeks ago meeting with the senior leadership team. we are aware of what they he are do doing and investing in quality control. we have seen a reduction in the number of the small issues that happen sometimes on deliveries. we have seen an improvement in the delivery of aircraft. a lot of that is down to supply chain issues resolved and daily issues with various parts not

arriving on time and after covid. that's getting better. we are still seven aircraft short on the contract position. that is better than the 45 that we would have gotten. >> neil, coto the extent you ca explain your position and united possibly positioning itself on this -- it may be united wants to get out of the contract. i don't know. they are trying to get a different deal at a lower price and maybe you are not or you feel you have already done that in terms of how things have gone. then how you are positioning yourself versus other airlines which have been quiet about it. i'm curious if you could go 30,000 feet and pretend you are not you and assess the motivations and sentiments for all of the players out there. >> i suppose i can only really talk about ryanair.

i feel the comments about the other airline last week why unnecessary. i think calhoun and west are doing a good job of turning things iraaround at boeing. the quality has improved. we have been willing and able to take the aircraft if the price is right. we would be happy to step in if united are heading to lose aircraft for themselves. we think the max is an excellent aircraft. we have 136 within our fleet at the moment. we have the max 8. they are fuel efficient and noise efficient. we love to have more in the fleet. >> neil, you might feel differently if your max 9s were grounded as a result. that is where united is coming at this because they don't have the capacity to fly all of the

passengers they promised as a result of being shutdown. >> and i would like to fly all of the passengers i have next summer. i will carry 200 passengers. i feel they are a good aircraft. yes, there were some quality slippages. i think boeing has done the right thing to address that. we put more people in seattle and spirit in wichita and continue to run march checks on the aircraft. i feel quality of the aircraft has come in and improved and the timing of deliveries has improved. is it where we like it to be? no. i like to get 57 this summer instead of 50. it is an improvement. we have 210 aircraft in the summer of 2025 with 225 million

passengers. >> neil, thank you very much for being with us. great to see you. >> pleasure. thank you very much. coming up,s escalation in the middle east. we will talk to retired army colonel jacks jacobs about the drone strike over the weekend. we're coming back after this. ♪ ♪ next. next. stop. we got it? no. keep going. aga... [ sigh ] next. next.

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welcome back. three u.s. service members were killed and dozens wounded in the drone attack near the syrian border near northeast jordan with president biden blaming the iranian-backed militia troops. this is concern for the middle east and what happens next. joining us now is retired u.s. army colonel jack jacobs. he is an nbc news military analyst. colonel jacobs, what happens next? >> these attacks are not new. they have been relatively continuous and spasmo sdic over long period of time. this is the first time americans have been killed. americans have been wounded in the past. we have counter strikes and also

spasmodically from time to time. this is the first time americans have been killed and for many o observers, that makes all the difference. nevertheless, we can expect there will be counter strikes. they will also be relatively limited even though quite a few people are calling for direct attacks on iran who funds and trains and encourages militias in various places. it remains to be seen what the united states is going to do, but whatever it does, whether it attacks in a more widespread way or does not, there will be a few criticisms about what the united states is doing to curb these attacks. >> already you have senator lindsey graham saying we should attack immediately. he stated this on twitter.

senator tom cotton, from arkansas, raise the stakes. he said anything less than to answer the attacks with the devastating military will call joe biden a coward as commander in chief. >> the united states is reluctant to any attacks. counter to the strikes is limited in what the administration perceives to be proportional. the principle reason is the perception in washington is anything more than that will widen the war. critics say and probably properly so, that iran's allies don't need any excuse to continue or widen their attacks. iran is fairly well convinced and probably properly that the united states is reluctant to attack iran directly.

iran is not particularly interested in engaging in a war with the united states. as a result of that, it will continue to encourage its allies to attack the way they are. there will be a ground swell of criticism that the united states needs to widen its attacks and widen the war. joe biden has a political problem. on the one hand, if he wide ns the war, he is open to cri criticism. it will be difficult for the administration to react properly to these attacks. >> iran says it is not calling the shots. do you believe that? do you believe these houthi rebels are out of control or do you think if iran wanted them to step down, it would be easy for them to get them to do that? >> i think the latter. it's not clear whether or not iran is actually calling the

shots, but they are certainly giving intelligence information and other kinds of support while not specifying when and where the attacks happen. don't forget houthi rebels are t attacking the cape. they are conducting attacks at will. so are some of the iran allies in syria and iraq and nearby. while iran is not specifying when and where the attacks should occur, they are behind all this, becky. >> colonel jacobs, thank you. >> you bet. >> "squawk box" will be right back.

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good morning to you. how big a super bowl is this going to be? if you were the nfl, roger goodell, are you thrilled with in matchup? this lineup? >> how could you not be, andrew? it's really a fascinating matchup. you've got one of the -- arguably now one of the greatest quarterbacks of all time in patrick mahomes going against mr. irrelevant, brock purdy was the last guy picked in the 2022 draft. you look at the salary difference, patrick mahomes making 59 million and brock purdy not even making a million dollars. the nfl should be absolutely thrilled for their showcase in vegas. >> what about the ratings? if you were going to make a

prediction, how is this going to rank. >> >> i think that this will probably rank in the top ten. we have seen a decline over time with ratings, just a slight decline in ratings. what we haven't seen a decline is the increase in the 30 second price of a commercial, which is going to be $70 million this year. i think you're going to see a top ten super bowl. the other interesting piece of this is going to be the impact that allegiant airline is going to see in terms of brand boost. when you host a super bowl. hive enterprises in los angeles, they've done studies, two to five minutes of exposure during super bowl is what the brand name partner of a stadium gets, but they're going to get probably 500 minutes of exposure in the week leading up to the super bowl because of the pregame coverage on espn and the nfl network. >> nfl must love this because of the taylor swift factor. there's been a lot of questions about whether or not she can

make the game. she has a concert in tokyo on february 10th the day before the big game in vegas. how does that affect or impact ratings whether she's there or not? >> i doubt it's going to affect them. we're talking about sports betting, so people will bet on anything. i can just imagine that some odds makers are going to have a betting line, will taylor swift make it to the super bowl? i would love to see that betting line somewhere. >> can you tell us, there's some new rules, obviously this is happening in vegas this year. some new rules about sports gambling, abilout gambling amon other players unrelated to even the game itself. what's happening? >> even though there's been more enga engagement, everyone's gambling more, but you still have to be concerned about the integrity of the sport. so every league is cracking down on what the players can and can't do, and they obviously want to be very restrictive.

you don't want to give this impression that, okay, if everyone else and more states are legalizing gambling, that can't seep into what the players are doing because the last thing that any of these leagues want, including roger goodell is compromising the integrity of these games. i am all for being extremely strict in penalizing players that cross that line. >> they can't even play the slots, though, apparently? >> again, you've got to crack down, and so i have no problem, no problem with the nfl and other leagues doing this. >> what do you think the implications of this kayshon story is going to be. he of course has been arrested for effectively gambling potentially on his own games. this is when he was in college, though. >> well, again, you think that when this is brought to light you would expect that this would have a stick effect on other players to make sure that you -- there are penalties, there are consequences. it reminds me, andrew, a little

bit of name, image, and likeness. it seemed to be the wild, wild west the first few years. we're starting to see schools get penalized and their collectives penalized for being too aggressive. hopefully this is going to have a positive effect on curbing players behavior. >> betting line, you have two bets you got to make. it's really yes or no question, bill belichick, will he be coaching tin '25? >> no. >> no, he does not return? >> no, i think he wants to return, but i think this last cycle was extremely fascinating, so, no, i don't think he's going to return. >> and then my other one is going to be. netflix for years and years and years netflix said never sports, never sports, and they've slowly crept closer and closer to sports, last week getting into world wrestling entertainment. when does netflix actually get into real sports? and given the scale that netflix has, it's the only one that can

actually compete with linear, when do they get the super bowl? >> i don't know if they get the super bowl anytime soon, but if apple's getting in with major league soccer, once this wave of tv deals expires, expect netflix to be involved in the bidding on the next wave of these contracts when they're up. >> we'll save the tape, patrick, thank you. >> thank you, andrew. when we come back, we've got two big interviews in the next hour, first gop presidential candidate nikki haley will join is right here on the set. and ftc chair lina khan will join us on. "squawk box" will be right back.

good morning, wall street awaiting earnings from big tech names and a decision by the fed on interest rates, what investors need to know ahead of the big news. gop presidential candidate nikki haley is vowing to stay in the republican presidential primary race at least through super tuesday. she will join us live with her plan to beat former president trump. plus, an exclusive interview with ftc chair lina khan on the inquiry of deals between big tech firms and ai companies. you can think of a few that come to mind. the second hour of "squawk box" begins right now. ♪ good morning, 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 along with becky quick. joe is off this morning.

the s&p up marginally, a little over a point. nasdaq up about 30 points this morning. also show you treasuries, show you where the ten-year and the two th two-year stand, just at about 4.330. a developing story this morning, three u.s. troops were killed in an taattack near the syrian borr over the weekend. at least 34 were wounded when the drone struck near their barracks early in the morning. president biden blaming iran-backed forces for that attack. you're looking at oil prices this morning higher after that attack. wti crude just about 78.06, but the markets have been remarkably sanguine given just how much you'd think the risks in all of this have escalated. >> on the energy front and the equities front, i think. let's talk a little more about those markets. they're going to be getting a

healthy dose of earnings this week. they'll be paying close attention to what the fed might say about a time line for rate cuts this week. joining us is joe ama toe, chief investment officer at new berger, burrman which has more than $450 billion in assets. speak to that point, energy markets have been incredibly calm. equity markets have been incredibly calm, and yet the worries about escalation are pretty real if you talk to anybody who follows foreign policy. >> i think the resilience of markets were remarkable, you know, both last year in the face of a lot of tightening of financial conditions and this year so far because this weekend's events remind us the world's still a dangerous place. you've got two hot wars going on. you've got a building cold war and all at the same time we're trying to sort through things like earnings this week and a fed meeting and a jobs report that comes out later this week. it's going to be an eventful week. >> the idea of cash on the sidelines, you say there's a record amount of that too.

that's kind of hard to believe. >> particularly on the individual investor side, there seems to be still a big chunk of cash, and our advice to clients is to start putting that to work. you're going to see a decline in rates at some point. >> you don't think there's going to be a better entry point? >> we think you should gradually put your money in. the fed has shifted gears significantly. i think that's very important in the context of keeping cash where you could have earned or were earning 5 plus percent, and that's going to come down at some point. what the timing of that is, still 50/50 for a march reduction. at some point over the course of '24 we expect rates to come down. >> we had roger ferguson on, the former vice chair of the fed in the last hour. his expectation is that you're going to hear jay powell really trying to walk a tight rope, which is to acknowledge the idea that inflation has come down pretty steadily, but to hold off the market's expectations for a rate cut as early as march.

>> i think it's sensible for him to do that. he can't deny the data. if you look at the six-month average of pc, it's less than 2%. so if you start looking at, you know, an inflation level there and policy rates at 5.5%, you've got real rates that are quite restrictive. it's going to be hard for him to fend it off too much. i think he wants to maintain optionality as any of us were if we were in that position. >> if he's able to do that and kind of try and convince the markets -- i guess that's the question, no matter what he says, will he be able to convince the markets that rate cuts aren't coming in march? >> i think the market's are certainly going to listen to what chair powell has to say and also look at the data points coming through. the data is not one sided. there's plenty of data points on both sides of an argument. our own view is that we do expect the economy to slow in '24 off of a pretty robust level in '23. so you know, so you're going to see some positive data points. you're going to see some

challenging data points, i think that allows him to balance that tight walk a bit more, right, given it's not necessarily a clear indication. >> you think that's the big issue this week, or do you think the bigger issue is going to be the earnings front, especially with five of the biggest technology names reported this week? >> no one expects any movement in rates for the fed meeting this week? i think the jobs report and earnings so we've got a number of mega tech stocks this week. >> microsoft, apple, alphabet. >> fourth quarter earnings for those companies are going to be upwards of 50% in aggregate. theest the rest of the market are down essentially 10% in the fourth quarter. the earnings of these companies are very important in keeping the market where it is? >> each of these companies has its own issues. you've got microsoft, apple, alphabet, amazon and meta, and some of them are going to tell us a little bit more about the

online advertising market, and that will be something to kind of behold. you've got questions about the cloud. you've got questions about ai and what kind of growth you can see from some of these companies. what are you kind of keying in on? >> i think there's a whole host of factors and idiosyncratic factors. it's hard to make a general comment. i think the bottom line is you want to see continued strong earnings growth in those companies, i think it's necessary for the market to continue the rally we've seen so far. and the rally we've seen so far this year is really a bit of reverting back to where we were prestrong year end rally. because you've seen the tech sector up 6%. the markets overall up 2.5, but you've got small cap down 2.5. so you've got gep,again a very narrow performance in the market. >> where are you telling investors to put their money right now? are you looking at areas of small caps where they're down or indexes where we're at all-time highs? >> across the spectrum of asset, we think the fixed income story

in '24 is a bit simpler than the equity story. in the equity story you've got slowing nominal growth. last year you had 7, 7.5% nominal growth ask flat earnings. this year you've got 4 to 5 nominal growth and you expect 12% earnings growth. i think earnings are a little more complex this year whereas taking cash and moving up the duration curve to capture some of the higher rate ss an important first step of putting more risk on as we've seen the shift from the fed jamming on the brake, keeping their foot on the brake to now lessening up which is an important segue for clients. >> the fed really is driving all of this. it's twwhat the fed is doing. >> the fed is in the driver's seat for sure. >> i want to thank you for coming in today. coming up after this, a lot more on "squawk." the biden administration hitting pause on new lng facilities.

he's going to join us with his thought on what the move means for the industry. and presidential hopeful nikki haley is going to join us to talk about the state of the gop china policy and so much more. we're coming right back. every day, more dog people are deciding it's time for a fresh approach to pet food. developed with vets. made from real meat and veggies. portioned for your dog. and delivered right to your door. it's smarter, healthier pet food. 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. ♪ (upbeat music) ♪

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burrman. neuberg welcome back to "squawk box," a live shot of the white house this morning. we spoke to energy secretary jennifer granholm on friday about the administration's plan to pause lng export approvals. >> nothing will change in terms of what is currently being exported or what is currently under construction. this is just a pause so that we can have an assessment that is rationally based and then apply

that assessment to those projects that are in the queue. >> our next guest says that move is a win for russia and a loss for american allies, jobs, and climate progress. joining us right now is the president and ceo of the american petroleum institute. good morning you. we spoke to her last week about this issue. a lot of folks in the industry have been critical of this decision and have suggested that this does very little, and in fact, may ultimately make things turn around. have you had conversations with her about this? >> we've had multiple conversations with the administration about this, and we're very concerned about this announcement. as you know, investment goes where it's welcome, and unfortunately, the administration's decision, i think, is going to push investment away from theunited states into other countries. this is a decision that's bad for consumers. it's bad for american national security, and it's certainly bad for american allies. >> let me ask you something, which is -- and brian sullivan said this on friday, if you just

look at how much lng we've begun to export and produce, frankly, in the united states, is a remarkable accomplishment, i think beyond anybody's expectation in terms of how successful we have been at this. and we have done it at a remarkable accelerated speed. i think you'd agree with that. is there any argument that you could come up with that says, you know what, we should fig out how we're doing this, what's the right strategic approach to this, all of that. is there any part of you that says this has gone so fast, so quickly, that a pause of some sort would be necessary? or do you believe a study is even necessary? >> well, let's put some numbers on it, andrew. the fact of the matter is that the united states exported more lng than it has in the history of time in 2023, and natural gas prices actually went down 63%. so the fact that the administration is putting this in economic terms when we all know this was a political

decision to appease a part of their political party's base in an election year, that is the real reason why they're doing this. the benefits to american lng are great from an environmental perspective, we're exporting american environmental progress to the rest of the world. from a national security perspective, it allows america to present american soft power to the rest of the world to provide them with the energy that they need during times of need, and finally, it's good for american consumers because when we have more markets, that means there's lower prices for american consumers as well because we have more production. so the implications of this, i think, could be far and wide, and unfortunately, i don't think the administration's thinking about them right now. >> can i ask you a somewhat maybe political question? because i can see two sides of everything you just said, one side you could say is actually that this administration or at least under this administration to the extent that there's a perception that there has been a difficulty in the energy markets

and that the administration has actually made it harder to produce gas and oil and energy and the sort has actually been the opposite given the numbers you just suggested being at record highs. that's a remarkable thing. you'd think that's a good thing. on the critical side, you'd say now here they are trying to slow it down. how do you look at that, both of those two ideas? >> the united states is now producing 13.3 million barrels of oil every single day. that's the highest level we've ever been at. unfortunately, that's despite biden administration policies, not because of biden administration policies. we're going to go through a year, for example, this year in 2024 where we will have zero lease sales in the gulf of mexico. we're down in terms of leasing on federal lands by 96%. they've taken over 500,000 acres offline in the state of alaska, the national petroleum refuge. most of this new development is actually on private lands, not

on public lands, and unfortunately we still get 25% of american production on public lands and in public waters. this administration continues to try to tap the brakes on american energy production at a time -- >> so where would we be, though, let's just say that you're 100% right, where would we be if -- you say this is in spite of the administration. where would we be if the administration went along with your goals? what would -- what would the market look like? how different would it be given that you just said that we're at historical highs in terms of what we've been able to do? >> well, as you know, there is quite a lag in terms of production on federal lands and in federal waters. in federal waters in particular, and in fact, there's some -- at least in the gulf of mexico that's been operating since the reagan administration, but those investments aren't being made today, which means we're sowing the seeds for an energy crisis in the future because we're not making those investments here in the united states.

and it's not that those investm investments aren't being made. it's just that they're not being made here. we're going to see continued production throughout the world. world energy demands are going to continue to grow. iea suggests that energy demands are going to go up by 50% in 2050 because we're going to be having 2 billion more people. our kids are going to be using a lot more electricity than we use. we need to get it from the united states where it's the safest in the most environmentally responsible manner. europeans who have depended on american lng because of the russian invasion are scared to death about what the future holds if this administration decision on lng goes guard. >> forward. >> one of the questions i asked jennifer granholm is can you walk and chew gum at the same time. which is to say can you conduct this study, if you will, at the same time you leave some of these things open so you don't take a pause per se, but then at the end of the study perhaps you do make some decisions and maybe

those would be hard decisions. would you support that? >> we certainly think they can walk and chew gum at the same time. there's almost as much natural gas waiting approval at the department of energy as the country of india uses on a y yearly basis. that's how much natural gas is being blocked for development at the department of energy. so yeah, we would welcome the opportunity to continue studying this with the department of energy, but we can't stand in the way of this important permitting process that has to get done in a timely manner if you want these investment decisions to actually be made in the gulf coast, in louisiana, in texas, and in other places that want liquefied natural gas infrastructure built. >> we're other time. let me ask you one last climate question, is there any part of you given what you do for a living that says, you know what? maybe in a perfect world, and the world's not perfect but in a perfect world you'd like to have less fossil fuels out there, do you agree with that or don't agree with that? >> the truth of the matter is we're going to need a lot oil and gas in the future under all

climate scenarios. we expect it to be a source of 50% of the world's energy in 2050, even if every country were to meet its paris climate goals. we're going to need more oil and natural gas, not less, and we think it should come from the united states where we produce it in the cleanest way possible and in a way that is safest in the world as well. >> mike, appreciate your perspective on all of. this thank you. when we come back, dom chu with a look at this morning's top movers. we're coming right back. "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.

let's get right over to dom chu. he's got a look at this morning's premarket movers. dom, how are you doing. >> >> i'm doing okay, monday morning, it was a late night. you know, i was so amped up, i couldn't get to sleep. >> i was thinking about you. >> i don't know if you stayed up to watch the whole thing, but it was -- >> i did. i couldn't put it down. i tried to twwalk away and it turned out to be right to the very end that game, i was thinking of you the whole time, the niners. >> i think america really wanted, i think generally speaking the story for the detroit lions. as a niners fan obviously i'm very happy about what happened. i'm a little bit worse for the wear, but hopefully, you know,

the super bowl kind of off in the distance, we can kind of maybe calm things down for maybe a couple of weeks. anyway, we'll start things off because i am try to get back in the swing of things. across the atlantic we are seeing shares of ryanair down fraction fractionally. the u.s. listed shares are down about 3/4 of a percent. it also lowered its full-year profit forecast due in part to some travel booking operators no longer selling some of their flights, which led the company to need to cut air fares to move ticket inventory. so ryanair, at least for now, down fractionally for those u.s.-list sharsd. also in the skies on the more domestic and friendlier front, american airlines up 1.5% getting some help from analysts at citigroup. they've upgrade to a buy from a neutral. they cited things like a continued focus on paying down debt and an ability to capitalize on trends is and

demand for premium service cabin offerings. american airlines up 1.5%. and we'll cap things off with a check on the media business, shares of warner brothers discovery down about 1.75% over 50,000 shares of volume. the media conglomerate, also network, other brands like hbo, cnn, and streaming service max is getting downgraded by analysts at wells fargo from an equal weight to overweight. the target price gets cut from $12 to 16. hay cited tougheri earnings growth trends, and lekss likely m&a opportunities as well. warner brothers discovery down 1.75%. thank you, sir. good luck getting over it all -- not getting over it all. you should be so excited. >> getting a lack of sleep. gop presidential nominee nikki haley is going to join us right after the break. and then ftc chair lina khan, she's going to join us for a

deanng ierewwi-rgintvi as well. "squawk box" returning right after this. ♪♪ heat makes it last. feel the power of contrast therapy. ♪♪ so you can rise from pain. icy hot.

welcome back to "squawk box" this morning, take a look at the futures. dow off just marginally. it's gotten a little better, faz

dakota off by 36 points. the s&p 500 up by about three points. she has lost to former president trump in the iowa is and the new hampshire primaries. the iowa caucuses and the nn primary, but former south carolina governor nikki haley vowing to keep going in the race to become the republican presidential candidate. joining us right now is nikki haley herself. thank you for being here. >> of course. >> governor, ambassador, i guess the first question is how do you do it. the path to get there has become a lot more difficult. >> it's interesting because you say that i lost in new hampshire. it's not really good for an incumbent not to get 43% of the vote. you look at the fact that the delegate count, he has 32. i have 17. it takes 1215 to get it, and so you know, a lot of the reason that i am for term limits is the same reason that i will say kind of to the media class and the political class is there's so cynical. you know, they've forgotten what it's like to have good things

happen and to be hopeful and to be optimistic. this is not over. it's far from over, and what i'll tell you is, look, he has been literally unhinged ever since i got 43% of the vote in new hampshire, and so i know what we're doing is working. but i also know that we had hundreds of people -- >> the attacks have gotten much more directed and much tougher coming at you. >> yeah, but that means i'm doing well. i mean, i don't -- >> from him, i mean. >> i know him well, and i know that when he feels vulnerable, when he feels threatened, he lashes out. you saw the night of the new hampshire election, he literally had a temper tantrum on stage and it's because he knew that he had told everybody we were going to be 30 points down and we weren't. and we came in and 43%, and he just lost his mind over it. >> but in order to win, you have to win some states, right now the polls have you down sharply in your own home state. what states do you win and how

do you take back the narrative? >> i think you look at -- we gained 25 points in the last three weeks of new hampshire, so we've got a month until south carolina, so we're going to keep building. there haven't been any current polls, but we're going to keep doing it. we had 1,500 people in the upstate of south carolina, we had a thousand people in charleston. l people are out there excited. they know what my record is. they don't want the chaos anymore, they see how president trump acted just think in the last 48 hours what he did. he has a temper tantrum and talks about revenge, then the next day he goes and says anybody that supports her is not going to be part of my maga group. so literally everybody that votes for me and everybody that donates for me can't be part of his club. and then he goes and pushes the rnc to name him the nominee. all of that happened. i appreciate it because we raised $4 million in the process, but it goes to show this is who he is. this is what he does. >> can i ask you about -- maybe it's threading a needle, maybe

there's no reason to thread anymore. he's been much more critical of you, but you arguably have now -- and maybe it's because you have to push back, have had to be more critical of him, and how you think about sort of how, you know, toally even talking about him. you look at the chris christie's of the world who made their campaign about going after him. you up until maybe a few weeks ago were trying to avoid that part of the conversation. >> there were 14 people in the race. my job is to get one fella out at a time, now it's a two-person race. now of course i'm going to be going against him. when there were 14 in it didn't make sense for me to do that. i have others i had to get out of the way. now i'm telling the truth about him. the truth of the fact is we have to seriously look. this samantha put us $8 trillion in debt in just four years. think about that, this is a man who praised china's president xi

a dozen times after china gave us covid. this is a man who wants to put 10% tariffs across board raising taxes on every single american. think about that for a second. that's what we're talking about. this is a man who continues to go and talk about himself and distracted with all the other things, but that night in new hampshire, after the court case, he's never once talked about the american people. he's never once talked about how we're going to get the country back on track. >> what would you do differently in terms of the spending? because donald trump didn't really spend like a republican. he did things that gave money to a lot of places and what would you do differently? which of those programs would you pair back? >> he didn't do anything that much different than biden. he paid off people to get votes. you know, we saw it when he gave out the stimulus checks, the same way we see biden going and throwing out all this money. what i would do different is everything you do with the economy is it should be how to get people less dependent on

government. you look at the economy, look at the economy under trump, yes, it was good, but at what cost? look at the economy under biden. everybody's talking about how good it is but look how government's grown. >> he did those things to buy votes and it was effective. >> it's dangerous too. i'm not going to do things to buy votes. i'm going to be honest with the american people. we've got to let the american people know that what donald trump's about to do to you is going to raise every household expense by $2,600 a year. they're going to raise the cost of anything from baby strollers to appliances under donald trump. middle class families can't afford that. >> let me ask you two policy questions in the news. one is immigration and what's happening at the border. there was a sense maybe that there could be some kind of deal made on the border. it sounds like mitch mcconnell is now saying that he's hearing effectively from president trump don't make a deal. it is better politically not to make a deal because it would better effectively the chances

of president trump -- by the way, it might better your chances as well, i don't know, so where do you stand on that? >> secure that border. i don't care what political chances it does, do the right thing. this is not the time to sit there and wait until november when you've got people coming through. when you look at the border deal -- and i'm not sure of all the details because it's been drip drip, the one thing that causes me pause is they don't have the remain in mexico policy. you should not want any illegal immigrant to step foot on american soil. i think that republicans and democrats are to blame on this. they need to get in a room and figure this out and not come out until they finish this. that's the problem is they can do better. >> but do you think a deal is worse for whoever actually becomes the republican nominee, which is to say that right now there's a lot of criticism against this administration given what's happening at the border. if a deal is reached, does he, biden, get the credit for that? >> i mean, it's a shame because

i don't think anybody should get credit. they should be embarrassed. what has congress done? what has the president done on the border? you haven't seen anything. so now that you do this you want us to praise you for doing the right thing you should have done years ago? why are we even talking about that. the problem in d.c., the problem with politics is they all want to know who's going to get the credit and who's going to get the blame and the american people fall to the wayside because of it. start calling things like they are. that's why i've always spoken in hard truths. you may not like what i say, but i'm always going to tell you the truth. >> the senate bill, would you take it even if it doesn't have the remain in mexico policy, that's been the argument don't let the perfect be the enemy of the good. that's an age old kafrconversat in washington. >> if they pass this, they'll leave it alone and won't try and fix it more. we can't allow people to come across the border period. you've got people on the terrorist watch list. these are not people getting vetted. we can't be okay with that. i know people are saying, oh, but you've got a little something. no, this is a national security

threat. america's acting like it's september 10th. we've got to remember what september 12th felt like. >> talking about national security threats, three troops killed over the weekend and possibly 25 or 30 others injured on the border of jordan and syria. what would you be doing right about now in terms of what's happening in the middle east? would we be going to war? you know -- >> new yorko, the goal is alway prevent war. my husband's serving overseas, military families want to know their loved ones are protected. biden didn't protect them, and there have been 160 strikes. there shouldn't have been one. there shouldn't have been two, and you've got 160, and you've got dozens injured. we lost three heroes because biden was scared of his own shadow. that's the ruth. >> what would that mean in practice? you said biden didn't do something. what was that something that he should have been doing? >> the very first strike that

hit, you punch and punch back hard. they should be going after every ounce of production of those missiles. wherever those missiles are you take that out. you go to the training site -- >> does that risk escalating a war. >> does that mean striking iran directly? >> it means striking the resources that are allowing them to hurt our troops. that's what you're doing. it's not going after the -- >> they're backed by iran. >> absolutely. >> iran's training them. they're providing intelligence, they're providing weapons. >> and this goes back -- >> there would be no hamas, hezbollah or houthis of iran. >> but striking iran is a big escalation. >> you go after wherever those missiles are, the production, wherever it is in iraq and syria yo you take that out. you go after the leaders making the decisions. it's not after iran the country, it's after the people making these decisions. when soleimani was assassinated, it sent a chill up their spine. they literally -- it took their breath out. you have to be strategic. it's not starting a war.

it's actually preventing war. >> do you think you can accomplish that without escalating to the point of a war? i mean, there are some people who look at your candidacy and say, she's very hawkish. she's very hawkish. and she could bring us to a war. >> why would i do that when my husband would be fighting in one. that's what you don't want. you actually prevent war. it's not being hawkish. what it is is it's itbeing smart. the problem we have is everybody waits for it to get bad before they do something about it. where did this all start? none of this would have started had biden not lifted the sanctions on iran, you allow billions of dollars to go in from china importing their oil and what did that do? they gave money to the proxies to get these missiles to do these things to do the training, to invade israel. all of that happened because they got money. biden still to this second hasn't increased sanctions on iran. that's lunacy. you're just continuing to pay them for trying to now kill our soldiers. there are things we can do that are not war, but not having common sense, there's no excuse

for that. and this is something where we've seen them do it with iran. we've saw him do it with afghanistan, russia and ukraine. you have to be tough. that doesn't mean starting a war. that actually means preventing war but when countries see that you're tough and you're serious, they back off. by nature they back off. iran knows they can't beat america. they've always known that, but as long as they smell blood in the water they're going to keep doing this. >> governor haley, i want to thank you for coming by today. >> thanks so much. >> go to nikkihaley.com, we're going to finish this. >> we appreciate it. we've kwot an exclusive interview with ftc chair lina khan, we're going to get her thoughts on big tech and some of the deals made with ai companies. she just announce d a big study. we've talk about that as we head to a break. we'll look at futures this morning ahead of what is going to be a very busy week for earnings. we've got the dow off about 13 points. nasdaq up about 22 points.

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this morning the federal trade commission looking into recent deals made between big tech giants microsoft, alphabet, amazon with artificial intelligence companies like open ai and anthropic. the agency is going to scrutinize partnerships and investments to better understand their impact on the competitive landscape. joining us right now is ftc chair lina khan. we're thrilled to have you at the table this morning. nice to see you. >> thanks for having me. >> help us understand how you're looking at this. these deals, if you will, are not classic mergers, if you will. these are effectively investments but maybe they look a little bit like mergers to you. >> so we are looking closely at the strategic investments and partnerships between microsoft and open ai, alphabet, amazon, and anthropic, and the goal here is really to look under the hood and understand precisely what is the nature of the relationship here? what are the deal terms? is there exclusivity that is

expected or required? is there going to be privileged access? are there rights to board seats or other mechanisms to be exerting control or influence over the business strategy. and just to step back, i want to explain why are we doing this? right? at this moment, ai is a nascent technology that could catalyze in more misgrowth. there's more opportunity for a vibrant market, but we also see risk. consolidation. risk of monopolization. the idea that it's in somehow america's national interests to be protecting monopolies, and unfortunately we've been down that road before. we see very clearly now with boeing some of the dangers of that strategy where you had united ceo scott kirby draw a straight line between the 1997 merger between boeing and mcdonnell douglas and some of the problems we're seeing now with planes falling apart in the sky. we need to be careful. >> let me ask you this, part of

the advance and frankly the advance of the u.s. companies, open ai, anthropic and the likes have had is the scale of capital that that i have been able to access. one of the thing that ai requires more than anything else is literally just server farms, it is super expensive, billions and billions of dollars. open ai was a not for profit. effectively needed the money from essentially microsoft. you think these companies could have accessed rather than doing it with the traditional folks that are probably most incentivized to provide those funds? >> look, i think you're absolutely right that these markets and some of these layers require enormous scale be it at the compute level, be it at the data level. i think we just need to be very wary when you have some of the existing incumbents that are threatened by this moment of technological disruption that they could be using this moment to try to protect their monopolies rather than allow the

opportunity that this technology presents to fully flourish. >> look, the weekend that sam altman left open ai and then came back in and everything we heard from that, i mean, it did seem like a possibility that microsoft was going to get basically a stealth takeover of sam, his team, all of that information. that did make me look at it a little differently. have you figured out what happened? is that what set things off for you? >> we've been watching this space quite closely. as a general matter launched an entry into cloud computing, you see significant concentration. commentary to that calling into question what is the relationship? passive investment or something more going on? anytime you have control or influence exercised through some of these partnerships, it's something -- >> sits on the board now? >> right. you know, we're a competition enforcer. could have with competition and

we want to understand what's going on. >> interestingly you called this a study and not an inquiry or investigation why? >> we do market-wide studies rather than a particular target. given where e are now, more prip. >> does it change the dynamic you have ability to subpoena or access other internal emails you might want access to, to better understand? >> we can enforce in court, no. if companies defy them. that perspective the same. >> do you use the services yourself? >> i have used them in the past. they're remarkable and in a whole set of ways? >> how do you use them? to send emails? what are you doing? >> i used one to contest a medical bill. typed in my general complaint and it spat out back a response. it was useful. >> you have not used one yet to

see if you could produce a suit against one of these companies? >> we haven't. >> i thought about doing that before you got here. haven't done yet but on my list. >> some lawyers got in trouble with judges, fake citations. got to be careful. >> ro khanna was here and says he might push for openai and other projects to try to find out what really happening that weekend of the openai, the sam altman battle. which agency? congress, do you think, more power to write laws, do these things? is it the ftc able to dig deeper and break down some of these relationships? who's going to have the authority, and who, frankly, will have the ability to get things done? >> as a general matter an all-hands on deck kind of

moment. we see interest across the federal government. the white house, the other month put out an executive order on art furlificial intelligence brg all to bear making sure regarding gets risks and dangers of the technology and safeguarding opportunities including on the competition front. we're see great intellectual leadership. now is time for the policy to follow on. >> i know you've said it's kind of the standard playbook to say nationalistically we need to get ahead, and that's why you protect some of the monopolies but they have a point in that china is pushing so hard and so fast on a.i. there is a concern that you don't want to get left behind as america. andrew pointed out, requires deep pockets, deep spending. china's government is spending a lot of money on this. what happens if american enterprise is not doing the same? >> a really good question. we've heard these arguments before.

right? go back several decades when the antitrust division was investigating at&t. you heard a lot of arguments how we shouldn't break up at&t, because we needed them to allow us to compete globally. we at that moment instead chose competition. doubled down. brought the suit. acquired at&t to open up its pat the vault, breaking them up feeding huge amounts of innovation. countries at that moment instead doubled down to protect their monopolies unfortunately were left behind. >> talking about opening up moats or things like that, i wanted to ask about something that took place last week. did you see apple announcing it would change the way its app store works in europe to comply with the new eu rules effectively allowing what they call side doors, software not in the app stream, create your own app store, other thing. however, created other charges and things that folks like spotify, they're complaining

about. curious what you thought what they announced. also, whether you think will you be helping eu in terms of how american companies comply with that law? >> so, look, a really interesting moment as we see some of these rules come into effect. i think we're going to see it firsthand what about it works, what about it doesn't work. we're focused on u.s. enforcement, u.s. policymaking. you know congress has been considering analogous rules and policies haven't yet gone into effect. if we, in fact, see that european citizens are benefiting from competition in ways that american citizens and companies are not, i think that could create additional incentive to move forward here. >> other headline, did you see, sure did you, microsoft activision announcing they'll be firing 1,900 people. elizabeth warren came out said, here's the reason why this deal never approved in the first place. you didn't want it aprproved in the first place.

how much should your job be in protecting u.s. jobs? in this specific case, seeing all sorts of layoffs, other companies in the industry. when you look at something like that do you say to yourself, that's a function of the deal itself? do you say that would have happened anyway? do you say, well, maybe wouldn't have been 1,900. maybe 800 people? tell me what you think when you read a headline like that? >> let me say my heart goes out to the 1,900 employees that got a pink slip last week. unfortunately where i sit this is not all too uncommon with mega mergers. you often see layoffs. we're supposed to protect competition in all markets including labor markets. one of the things to think about these 1,900 employees laid off, there could be among them the next big game developer. what does the market look like

for their employment? the last years through waves's acquisitions studios gobbled up. in terms of getting your idea to market, fewer and fewer pathways. that's bad for workers ultimately bad for consumers. >> and one of those people laid off, super talented to the extent they have a genius idea in their head, can't go find a venture capitalist, some other capital, create their game and then, frankly, gobbled up all over again by somebody else and that's a fabulous version of capitalism if it works that way? >> maybe. for that to happen they have to get their video game to market. increasingly, a small number of walt gardens. the big question is that independent gamer going to be ale to get their game in front of players in the first instances. as you've seen a shift from a more independent model, multiple pathways to reach gamers to instead now increasingly these -- two walt gardens, able

to get into the garden? an interest to let new? the big questions. >> lina khan, thanks for being here. through a lot of stuff. very, very helpful. >> thanks. we're coming right back, after this. 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 power e*trade's easy-to-use tools make complex trading less complicated. custom scans help you find new trading opportunities, while an earnings tool helps you plan your trades and stay on top of the market. e*trade from morgan stanley

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best converting checkout on the planet. a lot more. take your business to the next stage when you switch to shopify. good morning. a big week for markets and the economy taking off. busiest stretch for corporate earnings and friday the next jobs report, critical for the faend its calculation on

interest rates. president biden vowing to respond after three u.s. troops were killed in a drone strike over the weekend. we're going speak with a senate services committee member senator mark wayne mullen. and a key voice in the crypto company, chris dixon. weighing in on bitcoin etf to downfall and titans in the sector. final hour of "squawk box" begins right now. good morning, and welcome back to "squawk box" right here on cnbc. we are live from the nasdaq market site in times square. i'm becky quick along with andrew ross sorkin. joe is off today. take a quick look what's happening with u.s. equity futures. friday you had the dow closing at yet another high. super bowl and nasdaq pulled out

ending what had been a six-day winning streak to that point. this morning the s&p is flat. flat as you can possibly get. dow futures count by about 21 points's in fnasdaq up by 21 points. fed decision coming this week, closely watched what they say and what jay powell has to say afterwards. treasury markets ahead of that seeing yields pulling back having to do with awaiting the fed and also the geopolitical kearns heightened this weekend in the middle east. ten year note yielding 4.1%. two year at 3.3% and we'll continue to watch. a lot of earnings this week, too. >> and up to date on stop business stories we're watching. a court in hong kong holderering liquidation of evergrande. caught up in the country's debt crisis. halted after falling more than 20%.

evergrande facing more than $300 billion in liabilities. defaulted in to 21, since then, offshore debt restructuring program. lots of questions what this means for the rest of the real estate business in china. meantime, bayer paying $2 billion in connection with its weed killer. a man claimed developing cancer from exposure to the product. an appeal, the company says it will pursue. meantime, shares of sofi moving higher after their fourth quarter report earning up two cents a share. street expected adjusted net 594.2. . topped estimates of 571.8. sofi expecting to the profitable on a gap basis first quarter and full year company expects gap earnings of 7 cents to 8 cents. street looking for 5 cents. another beat there. back to the broader markets. bring in mike santoli.

he has been looking at whether investors have been overpaying for higher-quality companies. i read your column over the weekend, mike, and thought it was the perfect analogy. just the idea of some of these high-quality names being like beachfront property. >> exactly. basically, a scarcity value, always in demand, prone to be overpriced. vulnerability in a storm. a big theme. willingness to pay up for the best companies. what defines quality? great balance sheets, predictable earnings, high profit margins. we know the story. a big reason the s&p 500 has gotten to a 20 times forward earnings level. perception of the reliability of the biggest weights in the index. in fact, the index itself has become a higher-quality index and less cyclical over time. i think the market's ability to embrace good, economic news, the idea that the fed is looking for a chance to ease, the idea that

big tech earnings will substantiate earnings panel for this year is fed into this mark. see if it's culminating this week. tested this week for sure. an etf tracking the quality factor. several of these. one of the benchmark ones. over the last year exactly a 20 percentage point advantage over equal weighted s&p. clearly where the action is. easy to say, well, that's just the magnificent seven. microsoft, apple, all in there. alphabet. not only is it the big tech stocks, look at within other sectors. the quality representatives. the ones that are most reliable, and, therefore, maybe the most overpriced, are also trading at huge premium. costco up 40%. xrt, yellow line. basically flat. jpmorgan versus the other banks. this has been a tendency within the markets. can get overdone at times. one thing i'll say, also reflects a bit of defensiveness in the market.

if we had greater faith in durability of the economic expansion, you would probably see less of a premium on quality. to me, it's not so much giddy, speculative. people thinking the sky's the limit for these companies. the also a little not trusting the rest of the market. >> timing. beachfront property looks a lot more appealing in the spring heading into summer than in the middle of the winter. mike, joe amato was on earlier. he pointed at i keep kicking around in my head, a lot of cash on sidelines now. still from, still a lot of it coming from individual investors. >> yeah. >> cash or cash equivalents. looking at how much more you've been getting paid, looking at treasuries in other places if that starts to come down as the fed cuts rates will be a lot of money moving out of those securities, maybe looking for better returns in the market too. seems like a tough flood or tide, stick with this analogy, to fight?

>> i agree if it somehow made its way quickly into stocks you'd see overall risk appetites rising. a little reluctant to put a lot of weight on cash on the sidelines argument, to be honest. look at '90s. cash levels up along with the market. that cash there sitting there $6 trillion money markets, whatever it is, $$2.5 retail directly. a lot to bond. not right to stocks. don't have to worry about it, anyway. market can do fine without sort of tracking exactly where the dollars are coming from and going to. i guess it's a sort of psychological cushion. maybe a financial cushion. i think there are other reasons to feel like the market can do okay instead of, hey, people will get scared out of cash. >> mike, thank you. see you later. talk more about the market right now as we get set for research company. good morning to you. >> good morning. >> debating what the fed's going

to do, also debating how some earnings will turn out. i think people are a little more optimistic than they had been two weeks ago. where are you? >> i've been consistently optimistic, actually about this bull market that started october 27th of 2022. so so far so good. i think we're getting a little stretched. consolidation. earnings i think will be fine. especially for the quality names mike just went through. and at the same time, we've got some other issues that are, becoming, maybe more relevant and that's the ongoing conflict in the middle east, and, of course, the fed has to deal with these issues just the way investors do. >> so given your optimism later on the middle east, seems the market is taking this in stride. should it be? >> i think it's absolutely correct. i'm watching the price of oil. it's come up somewhat, but there

must be a tremendous amount of oil out there available from different channels. the same time it's important to realize that this notion that the u.s. would have recession to bring inflation down turns out to be incorrect. what really happened is china has had a recession, a property-led recession and europe's in recession. demand for oil is weak. that offsets some of the middle eastern concerns. >> when you think about what the fed is going to do, how important is your optimistic take to the idea that the fed is going to cut and cut potentially in march, is march too early? >> yeah. i think i'm a contrarian on this issue. markets have been expecting four, five, six, seven cuts this year and sooner rather than later. i think the markets backed off a bit on that, but i actually would like the fed to hold off easing at all. i think the fed has actually not only tightened, actually normalized. interest rates are back to where

they were before the great financial crisis. investors are finally getting an appropriate return in the money markets and in the bond market, and the economy has demonstrated it's resilient and can live with them. i'd say discuss capital market in the previous report. i'd like to see capital market work more efficiently and the bond market determine where capital should go. >> leave them as-is and the market will still go up at this point? >> well, i think if you leave them as-is, it's clear that one of the reasons for that is because the economy's doing well and earnings are coming in strong i think it's a good trade-off. i don't think there's any rush for the fed to ease right away here. they've got the risk of the middle east creating a 1970s scenario, two energy shocks, and then after they ease and become too dovish, they'll get a 1990 scenario, which is irrational exuberance.

i think the smartest course for them, to avoid these kind of risks on the, the tail risks, in fact, to do nothing. >> loathed to ask it, it's just a cliche of a question at this point. of the magnificent seven still magnificent? >> aww, some. some not so much. starting to be a little bit of a more specific story for each individual stock. obviously issues right now. but maybe it's not seven anymore. >> what is it? and what would you buy? what would you you touch? >> we did see a nice rebound since late october of last year, small cap and mid-cap stocks, which made a great deal of sense to me. really cheap stocks compared to the s&p 500. and there are lots of good small and mid-sized companies that should could bell in an environment where third year in a row we're not going to have

recession, as widely anticipated. i think that's a good area to be. i would stick with technology. i would stick with financials. i think energy has to be overweighted as a hedge against the middle east craziness. >> and we want to thank you, ed. leave it there. >> my pleasure. >> thank you for the optimism on a monday morning. still to come this morning, oklahoma senator markwayne mullin joining us to talk about the drone strike in jordan that took the lives of three american troops woundg zeindons of others. "squawk box" will be right back after this break. to help you see untapped possibilities and relentlessly work with you to make them real.

welcome back, everybody. president biden vowing retaliation after three u.s. troops were killed and dozens more injured in a drone strike 1234 jordan over the weekend. the first american fatalities since u.s. service members were targeted after the israel hms war hamas war started. it was not behind the drone strike directly, they say. joining us, oklahoma republican

senate markwayne mullin a member of the armed services committee, and, sir, calls directly coming for a much stronger response against this strike. what do you think is the appropriate response? >> we should have already been responding. 153 attacks on, on american interests, american personnel since october 17th. by iranian-backed terrorist organizations, from the houthis, to, to actors working inside of iraq and inside of iran both, and we have responded nine times. nine times with direct hits and delay. we know every single time they're shooting a drone or they're chuting direct missiles at us. we know where they came from. we can track them. we can respond immediately. the only thing iranians understand is strength. and by trying to think you don't want to escalate it plays right into their, i would say, they're propaganda.

when you just look the other way, they use that as a messaging to the people saying, see? they're afraid of us. this is why we have strength. it empowers them. when you go after them, they will stop. >> but the question is, "go after who?" suggesting direct strikes on iranians saying they'revolved w? are you saying take out every rebel group you know where drones and missiles are coming from? >> two. go directly with action. direct action, at individuals attacking you. and then, two, you go directly at iranian and put the sanctions back in place and pull the money you gave qatar back out of the banks. >> you'reattacking? >> if they continue you do. financial sanctions first. if it doesn't stop go directly at them. you cannot kill the snake if you don't cut the head of it off. >> look, some people fear that something like that can escalate

this into some other place that's much worse than where we are now. that's a fact. >> andrew -- >> optimistic version, right? >> sure. you don't apiece a bully either. at some point you've got to punch a bully in the mouth. what's happening with iran, iran is the bully. they are backing all terrorist organizations around the middle east, and everyone knows no question about it. they are doing that. so if you don't go after them, then they're going to just get worse and worse and worse. so you may escalate it. look what it's. attacked us 153 times since october 17th and now starting to kill american personnel. we have already lost three and will continue to lose -- >> let me ask you about that specifically. nikki haley effectively put this at the feet of president biden, and the administration, and said they needed to have been doing more. is "more" protecting those people in a different way than they were protected over weekend? or is "more" the punch them in the mouth idea, because then they wouldn't have been trying

to escalate at all? i think you believe that would have been the case. >> sure. let me understand. i don't want a war. i don't want to get into the middle east and fighting again, in iran. any one of us that's ever experienced that, smelt it heard it, been around it, none of us want that to happen, want that to happen again, andrew. but, at the same time you cannot de-escalate something when they're escalating it. you have to respond. i get when people say you don't want to get back into this fight. nikki haley sometimes gets a little more aggressive than what i would probably want to go to. same time, you have to show it. trump in office, i don't think for a second this would be taking place. know why? would have responded strong and with authority when the it first started happening. 153 strikes later now you're just now starting to talk tough and just now taken it serious? they don't respond that way. it's not the way the middle east

works. they only understand one thing and it's strength. >> one of the complicating factors is the technology that's now being deployed. this was a drone. we have tomahawk missiles that we can launch and try and protect and take some of these things out with, but people raised the questions recently, how long can you continue to fight $1,000 droern drones with million missiles? raises concerns and implications. what will you do in congress in terms looking for finances that we dedicate towards this? >> the unfortunate thing, what's happening right now, in ukraine is the war. the fortunate thing happening is we are getting used to this technology. russia is using these drones that iran is giving them. same ones attacking us in the middle east with. ukrainians figured out how to respond and defend against those in a cheap and effective manner.

we've been able to take that technology. technology moved don't have to use a $1 million missile to shoot down a $100,000 drone in some cases a $30,000 drone. so we have responded with technology. we're a long ways from getting where we need to be but still know where it's coming from. it still leave as footprint, you would say. same thing as you use your cell phone. you know where that cell phone went, where the ping was at and where it was going to. we can respond the exact same thing with a drone. we may not be able to pick it up immediately, when it was first shot, but we know where it originated from and don't always know the destination untilhits, though. >> aren't too many things the two sides of the aisle can see eye to eye on. getting less and less getting deeper into an election year. what is the unified approach congress could address at this and maybe send to the white house? >> i will say sitting on the senate armed services committee,

out of all committees i've sat on over 11 years, i've never had a chairman work in a more bipartisan manner than chairman reid. he's effective and the entire committee works that way. we have diverse committee. look on it. we have people you would think would never get along. we actually really get along and understand it, we spend a tremendous amount of time in classified briefings with our defense industry plus with the chairman, joint chairmans and the committee and on the staff, and one thing we're working on is understanding where the industry has to move. the technology that we're using today, andrew, is not what we were using -- two years ago on the war on terror. this is a conventional war iranis adapted and twriring to adapt to. >> mention separately, if former president trump was president this couldn't have happened. are you squarely in the camp

that nikki haley sitting in that seat a laugh hour ago should pack it in? what you're saying? >> she has a right to run. i'm a huge supporter of donald trump. one of the first senator, maybe the first to endorse him. i consider him a friend not just a candidate. a long history when my son gos real hurt and reaction donald trump took in that very tough time for the family. nikki haley can run if she wants to run. it's obvious there's no path for victory. i'm up for a good fight if i feel i can win. no path there, then you're just disrupting at some point. if she chooses to run, let her go ahead and run until she gets embarrassed in her own state. >> talking victory or not and politics of victory. you have, in the senate, talked to nikki haley about it, fight at the border, over immigration. this sense that maybe there's a deal to be had between democrats and republicans. i don't know if you think that's true, but if there is, there's also a sense that president trump would prefer frankly there isn't? if there is, there's a political

view that the biden administration would get credit for that? >> i don't think -- we're so late in the game now. whatever the bill is, i don't think they would even have time to implement it to make a difference on the border today. we do need some type of bill. the problem is, how far are we willing to be pushed before we say, listen. this bill's nothing more than shams to give anybody, say look, we're doing something. the government moves so slow, andrew, if we passed a bill today it would take it would -- before the rules and implementation and money could even flow that way, we would be way past the election. >> is that an argument to wait until the election? >> no. no. it doesn't matter when you start it. start it after the election we're still going to have the same time frame. border's an absolute disaster because joe biden's administration is looking the ear way saying we got it under control. border security, we all know the border is not secure now. knew it beforehand but there have actually been -- had to do

something now to eventually get to the point we can make changes. they won't happen overnight. >> senator mullin, thank you. >> becky, appreciate it. andrew. >> thank you. when we return, crypto in focus. a special interscrew ahead with andreeson partner chris dixon. next, watch this space. competition brewing in a key corner of the luxury goods market. robert frank is live in fmiami this morning covering a story. like a hardship job. tough work. see him after the break. robert, give a preview what a difficult assignment you've been working on. >> somebody's got to do it. dominating almost every sector of the luxury market except for luxury watches. today taking over miami as part of their push into the $30 billion luxury watch market. we'll take you inside the lvmh mansion and marketing maine ch when "squawk box" comes back after the break. e power of thinkorswim,

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welcome back to xwb. competition heating up in the luxury watch space. a corporate giant about to take aim at that market. and i am jealous, robert. >> good morning, andrew. luxury giant, right. lvmh shares up 13% friday. the best performance of that stock since in 15 years. that was after that great earnings report on thursday, but the next big growth opportunity for lvmh is luxury watches. global sales of luxury watches reaching $28 billion last year. expect it to reach about $37 billion over the next decade. lvmh all right owns ten watch brands and they're here in miami with six of those. those include tag heuer, hublot, zenith, others, and created a

couple weeks ago a new watch division appointing the 29-year-old son of chairman and ceo bernard arno as the ceo of lvmh watches. the goal here is to get into that very top tier that includes rolex and others and as part of that starting today they are taking over miami. rented out this $50 million mansion off miami beach. all flown -- flown in all the ceos, marketing managers, launching models, launching campaigns showing the world what they can do as a watch company. a sense of perspective. last year watches and jewelry for lvmh topped $12 billion. a number they want to continue growing as this market and as the company grows. >> robert frank, quite

something. how much money are they swend i spending this week? >> lvmh does everything big and everything is top notch. from the displays. each room in this mansion which is on the water, has its own marketing display. all the new models. all the ceos have flown in. so it's a massive marketing budget and shows that the world of luxury is now on a scale, on a global scale, that you really have to be large to compete now with lvmh. why we're seeing so much consolidation and could see independent watch brands sell to lvmh, because it's harder to compete against these giant budgets. >> can i ask a terrible question? means margin on these products is extraordinary. what is the margin on these watches? >> well, you know, the gross margin at lvmh is, one of the best in the sector. i don't know each, they don't break out the margins for each

brand. don't even break out the total watch sales for lvmh. probably somewhere around $2 billion, but at the very high end, you know, they put a lot of money into making these watches and ain credible amount of craftsmanship and materials but it's a very profitable business, andrew and why they want to grow that part. especially because the women's sector of watches is the fastest growing. >> robert frank. watching a video of somebody i guess was buying ing a cartier on sale for $20,000. brought it over, deciding what watch to buy, they brought over a $600 or $700 bottle of champaign to drink while this was happening. >> how about just give them a $600 discount? >> if the buy or not. thought to myself, there's margin there. pretty big margin there. >> friday night drinks -- for free! >> robert, nice to see you, sir. good luck. i don't need to wish you luck.

just have a ball and i'll try to live vicariously. up next, andreessen horowitz partner joining us for a special conversation about crypto and what he makes of the new bitcoin etfs. chris dixon. we'll be right back. ♪ (upbeat music) ♪ ( ♪♪ ) ( ♪♪ ) ( ♪♪ ) -awww. -awww. -awww. -nope. ( ♪♪ ) constant contact delivers the marketing tools your small business needs to keep up, excel, and grow. constant contact. helping the small stand tall.

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welcome back, everybody. news just out from amazon. irobot, terminating a pending acquisition. the deal faced opposition not just in eu antitrust regulators and here, too, the sail time i a robot offering a plan cutting about 350 jobs, or 31% of the workforce. irobot's chairman and ceo is stepping down and the chief legal operator named cio. irobot sheas down 21%. amazon shares up slightly. pretty big news highlighting risks of mergers and acquisitions. if the deal doesn't go through what does the acquiree do at that point? what step doss they have to take? especially given the scrutiny taking place in europe and the united states?

>> meantime, our next guest is one of those influential investors in the world of crypto. chris dixon a general partner in andreessen horowitz. notable investments include coinbase and others. new book titled "read, write, own: building the next era of the internet." chris, thank you for being with us. >> thank you for having me, andrew. >> about a million questions i have. i want to get to the book and talk about the book, but before we hit the book i think we're all trying to understand what just happened with the s.e.c. and this bitcoin etf and what it means not just for bitcoin potentially for the u.s.? >> crypto has been controversial any acceptance is a good thing. a net-positive. that said i'm very focused, and our firm is, entrepreneurs

building new utilities and applications used by millions eventually billions. focus on instruments. >> you separated yt of money crypto versus, like, utility crypto, if you will. >> yeah. >> and how much of a future do you think money crypto really has? >> i think, look, payments, defi. bitcoins are important applications. i view blockchains as an expansive technology. a new way to build internet service services. those can be games, financial services. the financial part is important but in a lot of ways overplayed in the discussions. it's one of the things i try to do in my book, describe up a the different expansive use cases for the technology. >> so solana is one that actually has a big use case, lie ethereum. curious, does it turn into its own etf? where do you think it really goes? >> specific etfs play out a long time. i think discussion of ethereum

etf. i think this technology is inevitable. the future of the internet, i think. over time you'll see greater, and greater acceptance of etfs and other types of financial instruments, but that will take time. our focus on investing in entrepreneurs -- >> nerve something you'd like at? too far down the road? >> for us. no. generally early-stage investors looking at, meeting with entre entrepreneurs, interesting ideas. an interesting technology building new internet services, that's kind of our focus. >> can i ask investing in entrepreneurs and coming out of crypto, one seem it's like big idea, nifts. hottest in the world. everyone wanted to get a chimp a monkey. remember? now nobody wants a chimp or monkey. maybe you think they do. >> yeah. >> what happens to this idea of tokenizing art?

>> i think that's the sort of death of nfts exaggerating. last year $28.7 billion in sales of nfts, a technology standardized and invented in 2020. very early technology. like a lot of technologies you go through boom/bust cycles. a lot of people think of nfts as sort of avatars. in fact, it's an expansive technology. we see musicians using nfts to sell digital memp dice to audiences creating new income streams supplementing streaming that doesn't pay well and used in social networks. x existing social networks you can't leave build an algorithm and you're stuck with it. a very broad technology. only scratched the surface and got a long way to go. we're very excited about it.

>> a separate question on crypto which is a lot of people look at crypto and think no regulation to all of this. not only very lig rel lation, still don't have meaningful regulation, the venture capitalist community is not effectively, properly, regulating the business insofar as looking at the investments in the right way. doing due diligence and the like opinion i've made the argument, curious if you agree or disagree, i've said to people, especially after the ftx of it all. looked a creditor can get all your money, possibly more, interesting. on the back of solana, interested in this. i said, look, most venture capitalists are buying 10, 20, 30 investments. they expect 10 or 20 of them, to go to 0. how they get to 0 is almost beside the point. so the kind of diligence that somehow the public is expecting from the venture world is not matched with reality.

do you agree with that? >> no. look, we take regulatory policy aspects of this area very seriously. we have a significant policy team, publishing articles on policy calling for greater regulatory clarity for a long time. i personally go to d.c. a lot. we take this very seriously. not investors in ftx for those reasons that we did see red flags and we've been involved with coinbase many years, a highly regulated business. kyc since the beginning. take this stuff seriously. 2r50u true venture capital is risky and lose a lot of money in investments but are based in the ud and take u.s. regulations very, very seriously and strong advocates for more guardrails around the technology. >> talking a lot about a.i. you write in your book about a.i. and tokenization and the need for that especially when it comes to this idea of deepfake. saw a deepfake of taylor swift

that was taken down, but after 50-some odd million people sought it last week? what does that mean long term? >> yeah. i'm very excited about a.i. obviously. our firm invests in a lot of a.i. powerful new technology. deepfakes will be increasingly common and you'll see advanced phishing and counterfeit people. going to be very hard to tell on the internet what's real and what isn't. i believe, and write in the book, blockchains of an important countermeasure. creating an immutable audit trail saying this video came from cnbc. came from the "new york times." >> required for any of the social media sites? >> i think that that's a policy approach that should really be looked at. in the ideal world -- >> coming from the u.s. government? >> i think, yeah, probably -- >> not voluntarily? >> hard to get parties to coordinate with some government action. right way to do that, have some

record where did the video come from? is it real? social networks enforcement they don't show fake videos. this will become an increasingly important issue and need to think about it now how to counter those things. we want want a internet awash with fake people and fake videos. >> already have that. >> already have that, yeah. >> and tokenize all of those images, articles, the other thing, will you be able to do that? and will you people be able to fake some of this stuff? >> well -- one of the great features of the blockchain is that you have an immutable crypto graphically proved audit trail. it makes it very, very -- mathematically impossible to fake it. that's one of the virtues. >> and does it work for an article? >> yeah. you can do this technology calls mashing. any piece of media you prove you have a digital audit trail. work for any kind of media. >> ethereum-based?

>> could be. obvious choice. solana, one of the major blockchains like that it would be, would work well for that. >> how much do you fear or not the big tech companies? talking with lina khan about the partnerships they've developed with some of the big a.i. companies. in the future do you see them running all of this? or do you really think it's all going to be so -- goes to the centralization versus decentralization of crypto? >> internet is extremely consolidated. top five tech companies, sure you talk about them on the show 50% of the nasdaq 100 market cap up from 20 ten years ago, networking traffic, google and apple have a duopoly on cell phones. like '70s broadcast tv. three channels and a.i. accelerate that. favors companies with large -- pro-a.i. invested in it. but a.i. rewards companies with

large stores of capital and data. >> lina khan right or wrong to be concerned? >> look, a lot of what lina -- like the reason these companies are powerful, frankly, happened 15 years ago. youtube and instagram. cow may have left the barn at that case. not sure if reverse consolidation of internet. sorry? >> never know until too late? >> they're hard to do. i think the right, regulation that's proactive and reactive. i see a lot of the m & a related stuff more reactive. one of the reasons i'm here, advocating for proactive rel lation. let's get ahead of this. >> doesn't that make it harder for you as a venture firm? historically a great model, invest in some of these great start-ups in part because we think that a meta or a microsoft or an apple is going to pay potentially overpay to acquire them?

you take them, effectively, out of the market, who is the buyer? >> then you have to ipo. have to go all the way. that's right. i think a lot of times regulation can have unattended secondary consequences. one of the unintended consequences of reducing m & a potentially is that you also reduce the incentive for investors to create start-ups that do compete with big companies. >> chris, thank you. book call the "read, write, own: building the next era of the internet." what going on in this, take a look. when we come back time for big decisions in the merger that go thrown into doubt earlier this month for jetblue. phil lebeau joins us. as we head to a break, watch or listen to us live using the cnbc app. stay tedun. "squawk box" will be right back. . - tonsillitis! - nostril! uh-uh... bill! uh-huh... - hip-hop! - limping! mmhmm! medical bills! uh-huh! - pancakes! - cash!

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well, after two years and

hundreds of millions of dollars spent, we are getting a lot closer to finding out where jetblue's merger with spirit airlines will actually happen. phil, good morning. >> we already know that a judge has agreed with the doj that this merger should not happen, blocking it. now, the question is whether or not jetblue and spirit appeal that decision, and on friday, we had duelling 8ks that were dropped by both airlines, starting with jetblue saying that it was evaluating its merger options. well, that probably spooked the people at spirit a little bit more than they were caring to hear at that time. they put an ak out saying "spirit believes there is no basis for terminating the merger agreement. spirit will continue to abide by all of the obligations under the merger agreement, and it expects jetblue to do the same." remember, spirit has 5.1% u.s. market share.

tomorrow, we get jetblue's quarterly earnings. if there's a time where they say, look, we've renegotiated the deal or we are out, we are done with this deal, that might be the time, again, that's purely speculation. at this point, we know that this merger agreement continues, and they do plan to appeal, and they are going to appeal the decision to block this merger. one other airline note. take a look at shares of united. it came out over the weekend that united is in discussions with airbus to see what it might be able to do in order to get a-321s so that it could fill in some of the slots that it had planned for the boeing 737 max-10. remember, they told us last week, scott kirby told us, we're taking it off the schedule. we don't know when it's going to be certified. we can't plan our fleet over the next couple of years not knowing when we might have a particular aircraft, so they're looking at the options with regard to airbus. united took delivery of its

first a-321, and the a-321 would be the counterpart to the 737 max-10, so the question becomes, what can they do with airbus in order to potentially get some of those a-321s that they need, guys, because otherwise they're going to be going forward with a fleet plan that is going to be smaller than what they originally had laid out when they thought they were going to have the max-10 starting later this year, early next year. >> we had the cfo of ryanair on earlier this morning, phil. >> i saw. >> it's a little rich, these guys saying what united is silly, because these are the same guys who were calling for dave calhoun to be thrown out last year when they didn't have their jets that were going to be delivered on time. i think they're happier now because they've been moved up a bit in the queue. >> sure. >> when you hear all of this, do you think it's just negotiations? do you think it's kind of, you know, arguing and jockeying for position?

>> there is a little bit of that, but with regard to united, this is not just, you know, public negotiation. this is a company that had a fleet plan for 150 max-10s that they now have to sit there and say, well, we don't have 150 planes on our schedule. we have pulled it off. we have no confidence when this plane will be certified. remember, everything with the faa, most believe you're not going to see the max-10 certified this year, which was the original expectation, so i think there's a little bit of that, guys, but there is also, with regard to united, they've got to make some plans for the future, which is why they're having these discussions with airbus. >> phil, thank you. "squawk box" will be right back. y, old school hard work meets bold new thinking. ( ♪♪ ) partnering to unlock new ideas, to create new legacies, to transform a company, industry, economy, generation.

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with just over 30 minutes to go before the opening bell, we want to bring in meagan, the cio at verdance capital advisors. we have got a lot of things happening this week. you've got the fed, earnings. why don't we start with the fed, because you say there's a big difference between what the fed should do and what they're likely to do. what is that? >> unfortunately, they took a bit more of a dovish tilt in their prior meetings in some of

the speeches we've heard and we think it's a little bit too soon for them to be taking that dovish tilt. i think they should actually get a little bit more hawkish and realign some of the expectation for interest rates this year, but there's way too much optimism on multiple interest rate cuts this year, and we don't see that on the horizon. >> okay, so, that means the fed will have to do what on wednesday? if you have to acknowledge the data, and the data that shows inflation has come down pretty sharply, how do you do that and not signal to the market, game on, in terms of rate cuts come march? >> because i just don't see -- yes, inflation has come down. it's improving quite a bit. it's coming in the right direction. it's getting toward that 2% target, but we're not at that 2% target yet. there is room to go, and the biggest concern that we see is that they could reignite inflation by getting too dovish

and not setting expectations for what the rate cuts will be. >> we've seen a pretty incredible continuation of the rally in january. it didn't stop after the santa claus rally, and there were a lot of people who thought maybe it would. does this make you nervous at this point, especially if you think the fed is not going to be able to cut rates as quickly as the market's anticipating? >> yeah, we think, again, january, seasonally, can still be a good month. it's up about 60% of the time on average about 1%, so it's not significantly surprising, especially given the fact that there's been so much optimism about the economy and optimism about the fed's going to come in and cut interest rates as quickly as march. we are concerned. we think evaluations would be heavy here. we would be looking at some of the areas of the market, the large cap areas, especially the growth side. make sure you're not overweight in portfolios, rebalance portfolios, because it has run so far and so fast, and we do think it's at risk of some sort of consolidation here. >> meagan, thank you very much for joining us today.

let's take a very quick final check on the markets before we hand things over. the futures have been mixed today. the down is off by 20 oints. the nasdaq, indicated up by about ten points right now. we do have a lot of earnings that are coming this week. make sure you're back here with us to join us tomorrow. see you then. right now, it's time for "squawk on the street." ♪ good monday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer at post nine of the new york stock exchange. david faber has the morning off. futures mixed for now, but what a week we have in store between mega cap earnings, jobs number, ongoing political tensions. our road map begins with records on a roll. big tech on a rally. amazon, alphabet, microsoft, amd, all on tap this week. china'