good morning welcome to "squawk box" here on cnbc we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen >> still >> andrew is off today >> still joe kernen. >> it is monday morning. you are looking at red arrows. nasdaq futures are off 50. the s&p futures are down 13. the dow and s&p are coming off the best weeks of 2024 nasdaq was at another new high on friday. goldman sachs reiterated the target for the year-end of s&p at 5,200 the chief strategist sees mega

cap tech leading the index 15% to 6,000 by the end of the year. these are interesting calls. things to pay attention to here. splitting it here. that's what you get when the markets are doing the things they have been doing recently. >> the dow was down 300. >> it was the best week for the s&p and dow. >> i like the treasury story incredible numbers about debt-to-gdp. unheard of and not getting better now you see it when you don't take in enough money through taxes for whatever reason -- >> you can't cover costs >> the fed covers it the treasury covers it whoever or whatever name you want to use. the numbers are staggering 60% more issuance from a couple of years ago >> it is a much bigger number.

you have to hope the markets pick it up you see yields higher this morning. lower than they've been in the last couple months >> isn't that how things un unravel? >> the markets don't care until they do. the ten-year yield is up 4.21% >> gold? series of new highs. >> you are seeing it is up $10 to $2,169. you are watching the dollar which is coming off its best week since the first week of january. $104.35 this morning bitcoin, which we have been following closely, is a good measurement of the liquidity in the markets. this morning, bitcoin is above $67,100. the quality of the auctions.

>> we talk to kevin warsh about it later on. >> he'll be on later. >> i can remember when we asked when trump was president, he would have warsh he has always liked warsh. that is not a surprise that it would be a possibility for him >> to be brought in. >> to preplace powell depending on what happens in november. for now, atlanta fed president raphael bostic is projecting just one interest rate cut this year adding it will happen later than previously expected. this is probably the most hawkish or the least dovish comments we've heard as the things have sort of -- bostic is a voting member on the fmoc. he had been guiding toward two cuts it is not different for him for

2024 he did not think the first would occur until the summer bostic telling reporters it will be a close call and he will have to see how the data comes in over the next several weeks. rate cuts in the state of the economy will be a couple of topics we will tackle with kevin warsh. he will be on at 8:10. he is gracing us with his presence in the studio today is that true >> i believe so. >> he's even better looking in person, i think, because you can see him 3d i'm allowed to say that. am i not >> you are >> an objective. >> don't draw me into it the government will remain open at least through the summer president biden signed that $1.2 trillion spending package. finalizing that remaining batch of bills and budget to keep the government funded through october 1st. the senate passed the budget in

a 74-24 vote at roughly 2:00 a.m. saturday morning. technically, that was two hours after the deadline due to last-minute disagreements, but the white house said it would not begin official shutdown operations since the deal had been secured regulators stepping up scrutiny of united airlines following the safety issues in the recent weeks faa will increase the oversight to ensure the safety compliance. the agency will be reviewing the processes and manuals and facilities in the coming weeks the faa warning the future projects may be delayed based on the findings the airline could face restrictions on new routes and use of new planes. scott kirby reached out to customers last week to assure them that the mishaps, unrelated, are receiving a high

level of attention with the oversight attention of boeing with the processes after that door plug blowout from the new 737 maxplane midni flight in january. you have seen the articles of people checking to see which type of plane >> i check which type of plane i get when i book. >> i did have a family member with a connecting flight i saw she is on that airbus. good when she landed and everything was fine, the second flight was a 737 max 9. is that the one? >> i guess so. i haven't taken myself off any of the flights. >> that's bad. that's bad that boeing is in this position. the 737 max 9 should be the boeing state-of-the-art. this must be a great plane.

>> by the way, we are saying this that boeing and united issues some have been with older planes and not the max 9 with united. these are raising questions of maintenance issues which is why it is not surprising to see the faa saying they will put heightened focus on what is happening there. we spoke with oscar mun oz last week i asked him the question is are we just hearing about these accidents or issues more frequently because of social media? he said he thinks not, but i'm not sure i buy it if the faa is stepping in and making these moves. the faa has to do it because it is so public they don't want to look like they're asleep at the wheel, so to speak >> right it's overblown probably. >> probably. >> i would say that is the case. >> we're all human we have loved ones that are

traveling. we want to make sure everything -- >> still the safest way of travel >> i don't want to jinx it. >> it is better than getting on a bus. it is still the safest way to tr travel this is how we react boeing union seeks a board seat the international association of machinists which represents 32,000 workers at boeing plants across washington state is looking to have a bigger voice at the company the union started contract talks with boeing earlier this month the first in 16 years. in a statement to reuters, boeing says it is reviewing the union proposals and plans to discuss them at the bargaining table. how is this the first in 16

years? china has rolled out new guidelineses for servers and computers. the financial times reveals that the guidelines are enforced blocking chips from intel and amd and blocking microsoft windows as they favor chinese alternatives china has been boosting the semiconductor industry as it seeks to reduce reliance on foreign technology disney responding to the latest criticism from nelson peltz. peltz recently blasted the company for making movies dominated by female and black actors highlighting the marvel's "black panther" and saying it is delivering a message and not delivering quality story telling. disney says this is the reason why he should not be lallowed on

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see why comcast business powers more small businesses than anyone else. get started for $49.99 a month plus ask how to get up to an $800 prepaid card. don't wait- call today. the market right now on track for its fifth consecutive month of gains joining us to talk about it is stephanie link at hightower.

stephanie, we were talk about raphael bostic saying he only sees one fed rate cut this year coming up. i don't think you think it matters all that much what the fed does because you are paying attention to the underlining economy. >> that's right, becky the numbers last week or the commentary from the fed adjusting gdp higher was a good sign it is nice they are finally realizing that they made progress in terms of the inflation front and we have seen that. we're down from 9% inflation to 3% we still have a way to go. the underlining fundamentals of the economy are strong i don't think it matters if they do one cut or two cuts or three cuts maybe they don't do any cuts this year. the point is the economy can handle where we are at the moment and that bodes well for

earnings and that bodes well for stocks most importantly, it bodes well for a broadening out i was looking at a variety of sectors this morning you know, technology year to date is up 9%. if you look at energy, industrials and financials, they're up 10% year to date. so, the market is broadening we had fits and starts with the broadening out and it narrows and that sort of thing, but i'm encouraged by this broadening out because it speaks to stronger earnings across the spe spectrum >> the basic underlining economy and what that means, you just bought shares of dr horton this week is that why you are doing this housing is your favorite sector? >> yeah. we talked about home depot and masko and sherwin williams dr horton is trading at 11 times. it is at 13 times historically if you look at the data last

week that caught my eye was the housing data if you look at housing starts, they rose 10.7% month over month and revised higher for the previous two months. single family homes up 11% month over month the permits is a leading indicator. you are running upper permits % from a year ago. that is encouraging. we have good home sales as well. cash buyers are up 28% first-time home buyers up 20%. i look at the numbers and how do you not be bullish with dr horton, this is the time you want to own it and other home builders because you see orders increase from this quarter from last quarter as much as 50%. i like d.r. rhorton because the cater to the first-time home

buyer. >> we were talking about how goldman sachs is reiterating th year-end target for the s&p 500. the analyst says there is a chance for the mega cap tech stocks to take the index higher which is 15% between now and the end of the year. we have been looking at some of the big tech stocks which have been struggling. apple down 6%. the doj bring the case last week that we have been hearing rumors about. that is a big overhang this are questions if that could do to apple what the doj did to microsoft years ago? >> there is a lot we don't know. i think it will take a long time before we get any resolution if you go back to google and their doj case, it will be a six-year situation by the time we get some reconciliation there.

you look at apple with the ebook issue. that took four years to get to resolution microsoft was three years. we will be talking about this for a while. i don't think we will get any kind of firm indication for quite some time. in the meantime, the stock is down 14% from its highs and the april quarter has been derisked because they lowered numbers as you recall i think you will get a buyback program announced as well during the april quarter of $90 billion or higher. of course, you got the a.i. me meetings in june that is interesting they have been doing m&a in a.i. and they shutdown cars to use that billion dollars that they he spent on the car market back into a.i those reasons are reasons i have been adding to the position. >> you voted for a while

>> i have, becky you know i have owned it for a while, but it was a small position at 1% it got to 7% of the benchmark. i was underweight. now i'm 500 basis points in the position t. is much bigger i feel it is at a favor at this point as well for the obvious reasons. that's your opportunity. >> stephanie, thank you for kicking off the week with us. >> pleasure. coming up, shohei ohtani will speak to the press for the first time since the illegal gambling and theft allegations he m emerged with the los angeles dodgers star does he have a new interpreter he is speaking to the press. what does this gambling mean for

baseball deja vu. pete rose. how many bets did i make this weekend? that's next on "squawk box." women own more than 14 million or 39% of all businesses in the u.s that's an increase of nearly 14% in the last four years growing at a faster rate than male-owned businesses. female business owners employed more than 12 million people and generated nearly $3 trillion in revenue last year. for women's history month, i'm julia boorstin ♪ ♪ this is not just another e-class. because it evolves with you. it adapts to you. engineering. it is the first e-class made just for you. for you. for you. this is not just design because your e-class... it adapts to you. it recognizes you. understands you. empowers you. energizes you. feels you. it evolves with you. the new e-class.

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baseball superstar shohei ohtani will speak to the media later today. this will be ohtani's first tme speaking to the press since the theft and gambling allegations emerged last week. claims by ohtani's lawyers that the star was the victim of theft from his interpreter ippei mizuhara >> and keith o'brien says the similarities between ohtani and pete rose is an issue. went to a great high school, keith, a former bomber

>> same high school as you, joe. >> trying to think if you grew up in the '70s, were you of age to watch what kind of player pete rose was and the big red machine? >> i was too young to remember the big red machine years. '75 and '76. i'm in the wheelhouse of the boyhood love of baseball when he was traded back to the reds. i remember everything after that the good and the bad there was both in the 1980s >> if you grew up in cincinnati, you cannot escape it that's what it's like. it was amazing you did miss out a little bit. morgan, bench, perez all those guys i don't understand the similarities remember pete rose and what happened was it just on the reds? was it ever against the reds when he was controlling who the starting pitchers were it all made a difference and it

was giamatti now so many weird things happen, keith. what is the parallel >> as you said, the parallels with what happens today and what happened 35 years ago is significant. there is no indication that shohei ohtani or his interpreter, was betting on baseball that was what pete rose was accused of and doing in the 1980s. the way it is unfolding is similar. >> it is weird there are weird things we don't understand it has been a long time before shohei ohtani will speak to the press. >> this is already, no matter what the details are, is already the greatest gambling scandal in baseball since pete rose 35 years ago. you know, just like 35 years ago, it is the press whose breaking the news and it is a federal investigation around the

inner circle of the player these are the things that started to unravel pete's world in 1989. >> it wasn't on draftkings either that's not a great or it can be a risky component of society these are underworld figures you are dealing with or that pete dealt with these are not legal bets placed. >> pete, obviously, in the 1980s, was betting book ties. there's a reason why a player or someone from his inner circle would be betting with an illegal bookie rather than draftkings. major league and nfl and all leagues are hiring third-party contractors who are monitoring wagering on the legal platforms. they can flag in a matter of minutes if someone is placing age bet on a game inside a

clubhouse someone connected to a player if one did want to bet today, as pete rose once did, the only way to do it is to go to the underworld we all know now that legal gambling is a major industry $120 billion was legally wagered on sports last year. also, roughly every year about $60 billion is illegally wagered on sports. those bookies are still operating in the underworld. the underworld is not a back alley or a smokey bar room they have glossy web sites like f fanduel and the others >> what do we know about shohei ohtani was he behind the wagers what do we know? >> the fact is we don't know much you know, the story has changed several times in the past five

days what we know at this hour is that someone, whether it was shohei ohtani or his interpreter, paid off a significant debt allegedly to an illegal bookmaker. this reportedly is a figure of millions of dollars. $4.5 million it is an enormous amount of money surrounding the biggest star in baseball today >> was it stolen from him or is that just the story to cover up the gambling >> who knows who knows? that's why it will be interesting to see what shohei ohtani does or does not say today just as it was interesting 35 years ago to see what pete rose would or would not say about what was happening in his inner circle at that time. that is another key parallel here pete often and rarely placed his

own bets on sports he was using guys in his inner circle it was federal investigations around these men, pete's friends and cohorts, that led to pete's downfall the feds were not looking into pete rose in 1988, they were looking into the men around him. that's what led to the knowledge of what pete rose was doing back then. >> $4.5 million is a lot of money. what did he sign for with the dodgers? >> $700 million. >> keep it in perspective. >> it is not a lot for him, but it is for his interpreter. if there were bets coming from is somewhere >> i don't need to name names. when they are in vegas, basketball guys. $500,000. >> unless you are betting baseball games >> that's a lot of money i think it is weird they are so amaz amazing. no one is ever getting 4,200 hits ever

20 seasons of 200 hits. >> incredible figure just to put it in perspective, the active leader in baseball today has roughly half of that he is in his late 30s. this is a record that's never going to fall. a record that people did not think would fall in the first place when ty cobb held it >> were you born on the west side i don't think you're from the west side. >> now we're having a cincinnati conversation. >> i used to see pete. he went to west high which is up the street from my house he had a corvette. he is a real interesting guy both of them are incredibly talented are the dodgers bummed is this in his head this year, do you think will this get in the way of what they paid? they want a world series badly,

right? >> forget about the dodgers for a second i believe major league baseball is disappointed. this is the most recognizable and most famous baseball star in the world. you know, just as pete rose once was in 1989. pete rose in 1989 was an aging version of shohei ohtani. >> this needs to be handled right. i wonder how that colors how much they say -- the cover up is worse than the crime we will be watching that you'll be on it? >> i'll be on it, joe. >> where do you live now >> i live in new hampshire now >> in new hampshire? >> yeah. >> a long way from the west side of ohio. >> good timing on the book >> thank you just as we planned it. >> skyline or gold star or price hill chili >> skyline >> we knew that family

my parents it's good stuff. all the same that cinnamon base. >> very similar cincinnati chili playbook. >> greaters. >> ice cream i'm all in >> yeah. me, too. >> you could have that for breakfast. >> yes >> raspberry with chocolate chunk. i likethat one. >> i don't like that one regular vanilla. unbelievable i didn't that that much. thanks >> congratulations on the book. >> thank you very much. when we come back, china kicking off a development forum to attract more businesses apple's tim cook is one of nearly 100 ceos in attendance. we will talk about what this means for chinese ecomony and the u.s. regulations for consumers. "squawk box" will be right back.

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the european union is launching an investigation into apple, alphabet and meta the first probe under the digital markets act tech legislation. the commission says it is concerned about the constraints the tech companies place on the

developer's ability to freely communicate with the users and promote offers the bloc will look into the changes over the search results in europe and what it calls the meta pay or content plan if they don't agree to let the company comply to use the user fee. tim cook and albert bourla and ray dalio are some of the names attending the high profile china development forum. joining us now is dan. any easier to thread the needle for these guys, dan? they have to be here, but we are right in the middle tof the ultimate frenemy debate.

we need to keep an eye on what is happening >> the difference today compared to a couple of years ago with the forums is china two years now has not really grown in 2022, terrible growth year and last year, they say it was pretty good with the official numbers, but you cannot see anything growing china with not a lot of growth on the table will not have the same conversations with leaders whether it is ceos or other heads of state and treasury secretaries and other officials around the world >> do you think with some of the people that we mentioned that are so all-in with china, do you think they're disappointed in the pivot that president xi made a couple of years ago? >> you know, i don't think anybody is all-in and hasn't been for a while folks have been hedging back in

a prudent way for a good, long while now. everybody has their eyes wide dd they are as business leaders and chinese economists and western economists are disappointed. we're puzzled. china has opportunities to address the elephant in the room which is the world is crying out for demand stimulus policies to manage the anemic conditions and consumption. all they are offered back is supply stimulus, which is causing overcapacity problems and additional trade conflict. >> you don't think ray dalia is all-in i heard all about how we need to have a rehe boot on our version of capitalism because it causes inequality we could not get him to say the negative word about uyghurs or

anything >> you are picking the extreme >> we said ray >> tim cook and other guys as well even ray, if you look at the extreme ends of the curve, and you have a kfew other folks as well, they have moved a bit to the more skeptical end of the spectrum they are saying instead of everything is great and no problem here, they are searching for explanations and why we shouldn't be pessimistic about the outlook. it is harder to find the lines of reasoning >> we keep going back and forth. we do something and then china retaliates and doing something a lot of it is almost symbolic it doesn't seem like it is

helping china's growth prospects. it could put a damper on what the future looks like. i don't know why gdp would be better. >> yeah. we talked about domestic demand in china as the number one thing missing from the growth equation the number two is non-reprnon-trivial is the largest ever trade surplus for income growth for all of the people who have to consume stuff tomorrow, exports important. when the signals inter nat nationally and berlin, which is equal to the ray observation there there is a different conversation taking place. it all points to less per mismiss sif attitudes. they should not be expecting the world to be tolerating

additional growth in the trade surplus to grow out of the problem. >> schwartzman doesn't count how about nike the nba? i can go on and on and on for people that are all-in >> u.s. firms built up $600 billion of asset positions in china that generated a lot of income for decades and decades if you have very, very dark outlook, you don't say that on network television before you have a chance to try to figure out what you do with assets. >> there are plenty of guys all-in >> again, relative to where they were a year ago at the beginning of 2023 where they were saying hang in there. once covid subsides, we will see the china comeback the story was by the end of 2023, nobody was telling that story. >> i'm not disparaging them. the world is great

the world is great we deal with all kinds of countries that we don't agree with on all sorts of things. i understand thank you, dan >> great to be back. when we come back, united healthcare trying to get out from the cyber attack. we have that story next or an update on that story. reminder, you can get the best of "squawk box" in our podcast. follow "squawk pod" and listen anytime. we'll be right back. filled with line 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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united healthcare unit is beginning to process the medical claims after the backlog with services was disrupted last

month by a cyber attack. united processed $2.5 billion of the $14 billion in total climbs. the company continues to work to fully restore excservices shares are down 6% in the last three months. when we come back, millions of consumers will spend big money on thrill rides and experiences this spring and summer the ceo of merlin entertainment, the name hind gondlela will give us a rundown on the theme park economy. that's next. >> announcer: executive edge is sponsored by at&t business next level moments need the next level network. of aruba? huh. this listing is misleading. well, when at&t says we give businesses get our best deal,

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welcome back, everybody. our next guest is a 25-year veteran of the sports and entertainment industry and has

unique insights on the state of the consumer in the post-covid tourism rebound. joining us is scott o'neil the company is the world's second largest visitor attraction operator. they have attractions like pepa pick, the theme park for that and legoland scott, thanks for coming in. >> it's great to be here. >> we keep hearing that experiences are what people want to spend on. that certainly seems to be the case what are you seeing with the theme park economy >> coming out of covid, we learned one thing, right that is that we need each other. we need time together. we need experiences and we seem to have tail winds for that. our business is legoland resorts, resort theme parks think like a six flags or a cedar fair in europe, and gateway. we as i like to say, the sun never sets on merlin

we get to see recoverfully asia and china, japan is a little better and the u.s. is sizzling. >> the weird thing is world wise you saw a big increase in revenue last year, 13%, but you haven't seen visitors return to the attractions like they were in the pre-covid numbers in the 2019 numbers what was it 63 million versus 67 million from pre-pandemic levels >> we are up 7 million over '22. they are coming back i feel like the consumer behavior has shifted a bit, so we're picking fewer attractions and going dpeeper, staying longer, spending more at fewer attractions. >> just in terms of one thing you guys rolled out recently, surge pricing. the idea it would cost more when you go to a park during a busy time, less maybe on a rainy tuesday in april versus a sunny saturday in august or july that has been something that makes sense, i think, to investors, but it's certainly gotten pushback from consumers we saw it at wendy's too when

they talked about surge pricing. i think of paying a thousand dollars for an uber on new year's eve how do you see surge pricing >> from our business it's dynamic pricing. that actually ironically does two things it protects the guest experience so for us, like we have limited capacity you don't want to go to legoland florida and wait hours in line so you take the prices up, it keeps the numbers down to a reasonable number -- we have the highest guest satisfaction scores of all time this year for a reason then it also, for those of us who are a little more budget conscious or a little more value based, what an opportunity to have more people be able to experience it. it's very smart, it's very intuitive. i know it's like a cute headline and lights up twitter, but for our perspective, it's the right way to take care of more

consumers. >> on the one hand i understand that it's the same thing that airline prices do, it's the same thing hotel prices do. they go up during spring break if you try and rent a house at the beach, it's higher in the summertime when the kids are out of school. it's what a lot of other industries do. you get pushback from families who say they can only travel when the kids are out of school. >> for those of us who didn't grow up with a nickel, there weren't many theme parks you could go to as a kid. >> how much of a discount do you get. >> a price in korea and a price in california would be very different. >> like a 10% diszmcount? >> a bit more. if you go back to economic classes in school, you move that supply and demand curve up and down. >> it makes sense, something a lot of other industries do, but it is something that you get particular pushback with

consumers when they read headlines. wendy's had to come out and say it's not that we're going to charge more, we're going to give you less when there's less business in the stores it's kind of how you explain it to an investor. >> to a consumer i'd say we have a value opportunity for you, you know, so you can go. you won't say you're priced too high you say okay, that seems like a really good opportunity, and we want to keep our guest satisfaction scores good we want to keep the lines down. >> how is the consumer faring around the globe where is it the strongest? >> the u.s. is the strongest china is a bit slower than we anticipated coming back, which should be no surprise to your listeners. and the uk and europe is a one step forward, two steps back, one step forward, two steps back, it's a wait and see. >> what about the fed, what they're doing with interest rates, how does that impact anything you're doing with the company, in terms of what you can build, the bonds you need to

take out, if there's anything you can refinance based on what interest rates are out there. >> we just went through a very large refinancing, almost 2 billion in debt. over subscribed which is good news it does make the cost of doing business more expensive. this is a big wiz. we're 30,000 employees, 2 billion in revenue we have plenty of liquidity, and with blackstone and kirk being ccpib as our shareholders, we have a mandate to kbroe, to bu build, to acquire. it's a really fun time to be part of merlin. >> vegas for little kids >> probably like 5 and under. >> looking at the roller coaster, it looks like about my speed. i'm not kidding. i'm not going back i'm not going on those things, those ones where if it stops and you're upside down like 800 feet off the ground it takes like three hours, you know, you're totally red i'm not going on there i'm not, i'm not bungee cord

jumping. i'll go on a peppa pig roller coaster. >> we have something for everything. >> i looked at the ride for peppa pig. i would go to peppa pig. i would. >> the balloon rides, they're not balloons they got big things, but they're hooked on. >> there is a flight to quality in terms of consumer insurance brands like leg go world class brand, peppa big, ferrari is another one of our partners. brands matter, they want safe, easy, comfortable, and quality >> safe the operative term there. thank you. the european union launching an investigation into apple, alpha and meta we're going to get into that story in the next hour with walter isaacson, and former fed governor kevin warsh on central bank's rate path, and would he consider a position as fed chairman if asked, would anyone

say no "squawk box" will be right back.

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. breaking news this morning, the european union is launching an investigation into apple, alphabet, and meta. we will have the details. a conflict of interest for elon musk and the board of tesla, musk buying ographer jois us on what it could mean for shareholders. plus, a look at what investors will need to watch in the markets in the week ahead. the second hour of "squawk box" begins right now good morning, and welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square i'm joe kernen along with becky quick. andrew is off. the futures this morning after a

mixed -- i guess you'd call it mixed, 300 down on the dow on friday, but the nasdaq was higher this morning it's red across the board, but it's early, as we say, and we've got 80 points on the dow, s&p off about 16. there has been a big rally in the last six weeks or so check treasuries this morning, we're going to talk all about yields and some of the latest comments from some of the fed heads on what to expect, maybe just one rate cut according to raphael bostic, but you can see the ten-year now 4.23. check out oil, and then we'll look at 81, look at bitcoin, which rallied into saturday, kind of quiet, sunday started moving a little bit higher, and this morning as you can see, it's up almost 2% at 67,000. the european union is launching an investigation into apple, alphabet, and meta

and this is the first probe under the sweeping new digital markets act tech legislation that's statendesigned to rein i- oh, it's going to reign in big tech, sort of a royal way of pulling it in, instead of just regular rein r-e-i-g-n and promote their offers, the block will also look into changes that google made to how its search results appear in europe, and also probe what regulators call meta's pay or consent plan and under that plan, european users who don't agree to let the company use their digital activity to target the ads it shows on instagram and facebook have to pay a monthly subscription fee a short week for traders, the markets will be closed for good friday. joining us right now to talk about the week ahead and beyond

is rbc capital market's head of u.s. strategy. we have seen the markets really have a pretty phenomenal year at this point the s&p has already set 20 new highs before we reach the end of the first quarter. you're looking at all of this, and your target for the s&p 500 is below where it stands right now. >> yeah, and look, i think this is one of those moments where we're taking on a lot of information and digesting some conflicting cross currents i think if you want one stat that explains why it's been such a good year, look at gdp forecasts. if consensus is looking for 2.1% this year, and to start the year it was closer to 1 as recently as mid-february it was about 1.6. last summer it was 0.6 so this whole idea that we're on the brink of a recession, that's just been brushed aside, and now the debate is how hot is the economy, and one of the most common, you know, sort of worry points i hear from investors over the last month or so has been is the u.s. economy so hot the fed can't possibly cut

>> that's such a weird worry, right, when you think about things. >> it's so weird if you think back to last august when people were like, well, the fed isn't going to cut inflation is going to be sticky and they're going to worry us into a recession it's the same worry the fed's not going to canut >> this weird cross current, i think about all the people trying to figure this out right now. the fed is facing the same problem. do we cut rates, do we stand pat? a few months ago or a month ago we were asking if they would have to raise rates because inflation has been hotter than expected goldman sachs has a weird way of dealing with this. they're sticking with their s&p target they've got another group of analysts led by david kostin who's saying there is a chance that big tech is going to take this all the way, the s&p 500 all the way, another 15% higher to 6,000 how do you do that how do you add somebody who's responsible for saying where the market's going to be at the end of the year? >> the way a lot of us do it,

we'll say this is the base case bull case, bear case even within our own modeling, we have this one valuation model and we run all kinds of stress tests. if i take current consensus projections, it points to 5,400 on the s&p at the end of the year if you use consensus, it's 5,700. i ran a new stress test where i soften them a bit, reflect what's in the fed sep, that points you to about 5,300 on my earnings number and 5,500 on consensus earnings i see a bull case that seems very, very reasonable to me. the problem is if you look at sentiment, and how quickly, again, the markets have come, so the cftc data on buy side positioning is above levels we saw in early 2018, is above levels we saw in february 2020, precovid and above all the highs we've seen the past couple of years. you look at aaii net bulls your standard deviation above the long-term average, and kind of muted gains over the next 12

months there's all this great news, have we priced a lot of it in. markets are funny, they often run hotter than they should. we think this is a real recovery we're in the sentiment data is sending nasty signals right now. as a strategist we try to balance all of that. and sometimes it doesn't always line up perfectly. usually the sentiment can get resolved quickly and markets can kind of recover and march on that's kind of my assumption right now. i've been looking for a pullback in three months and we haven't gotten it. >> you're not alone. i would say this is a really weird year but then again you could say that probably about every year you think to 2019, nobody was predicting or expecting that we'd have a global pandemic that would shut down economies everywhere. >> i think that's fair, and i'll tell you what's kind of made things make a little more sense in my head to me we wrote about it a bit this morning. i think we came close to a recession in 2022. we had two negative gdp quarters the stock market priced in a

recession. consumer sentiment on the michigan survey went to recession lows the misery index spiked because of inflation, not unemployment, and you kind of felt as bad as you typically do in a recession. so i think we're in this weird recovery that nobody understands. >> that's crazy, we've already had the soft landing essentially? we had the landing, we've taken off again? >> i think we had like that dove year in the pandemic we were debating all the letters, and i think we kind of had a baby -- >> i forgot about that until you just said that. >> it was this v shaped recovery we basically had that, but i think you kind of had like a shallow kind of other v on the other side of the w. and one thing about recoveries coming off a big crises, we tend to underestimate everything, people get ptsd and underestimate earnings, underestimate the economy, and i think that's what we've done on the economy recently. >> what do you think is the most likely scenario? >> i think that we're going to have some choppiness at some point this year. i think we're going to have a little bit of a pullback,

somewhere between 5 and 10%, maybe closer to 5 because everybody wants it. >> that's not much of a pullback if you're an investor waiting to get in. >> it's not. i think we're going to have some chop choppiness there's the constructive camp and the sky is falling camp, and i'm not in that latter. >> laurie, what's your total -- i remember when trump was on, he said prices were up 50%. they're not up 50%, but they are up i don't know what number you would use probably i think 30 is probably about right. >> inflation or? >> from the -- when you have a couple of years -- when you have a couple years of much higher than expected and then it slows to 3 or 4, you've still got the couple of years of much higher i just know from going, maybe it's the supermarket i go to is so expensive, but i can feel it. i still feel it, and wages, have they caught up i mean, are people now -- does their dollar go as far as it did three or four years ago?

>> look, i think in terms of like food prices and all the things we're sort of confronted with on a daily basis, i have two small children, right? i see this in terms of how much it costs to stock my refrigerator i'm right there with you >> gas prices, they're down, but. >> they're not great, but they're better i think you have had some wage catchup that has helped offset a lot of this. i think you have different consumers feeling things differently. the low end, that's what we continue to see signs of a bit of a crack if you read through like all the food companies, for example, or other consumer companies, they are more sensitive to short-term interest rates than high end consumers are. high end consumers have done all the same things, right, that companies have done, turned out their debts, locked in low mortgage rates they're able to offset some of these things like higher grocery prices people are feeling. >> lower end or newer end. i think that sets up some of the generational disputes you see too. >> i was talking to my economist about this recently.

i think this high end, low end conversation, i think it's old versus young >> generational. if you are trying to be a first-time home buyer, if you don't have the ability to offset some of the debts that you've had by locking in lower mortgage rates, it's a different ball game. >> and i do wonder, you know, and look, i don't make the fed calls for rbc, but i do wonder in this whole debate over the fed and what keeps them going in june despite the fact that prices are still high, i do wonder if it's that pressure on the low end. i remember very clearly when they first started to headike ty were talking about the inflation on the lower end >> i really don't understand one cut. i mean, what is that yeah, we're cutting but we're not really cutting, and it's not really going to do anything. we feel like we should do -- that's -- what is hat? we're not in a cutting cycle we just -- we promised you a cut, some cuts so we'll give you one, but we really want to -- >> the last rate hike basically, we take it back. >> we really want to stay where

we are we're going to give you one because we got your hopes up. >> it could lead to zero, right? zero cuts. >> i think that debate is still on the table. >> it's not far from a hike either >> we got everybody excited on wednesday, and then he took it away on friday i mean, and we're really just going to be stuck in this will they, won't they, will they won't they debate until they actually do the first cut. if i were them i would go ahead and cut and do it at a moderate pace and go slow i think they need to get it started. equity investors are not going to be able to have any contentment about this until we actually get it going. >> laurie, thanks for coming in today. >> thanks for having me. president biden signing a $1.2 trillion government funding bill, amid political battles in washington, we're going to speak to pimco's head of public policy this a few minutes. later, more on the european pl ahat,investigation into ape,lpbe and meta. "squawk box" will be right back. the next era of ai has arrived.

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and welcome back to "squawk b box" i'm dominic chu we'll start off with shares of zoom video, higher by just around maybe half a percent or so, roughly 4,000 shares of volume the communications platform company known for its video conferencing products is getting some help this morning after it unveiled zoom workplace, which is a new ai-powered platform to help drive more efficient and effective workplace collaboration. now, a focal point will be zoom's ai companion digital assistant tool zoom video in the news, ai related up half a percent. shares of united airlines down roughly 4 or so present, roughly 30,000 shares of volume. turbulence for america's third biggest commercial airline by market value regulators at the federal aviation administration said over the weekend they will be stepping up oversight of the airline to make sure it's fully

complying with safety regulations. that process could lead to future delays in certification processes based on findings from that oversight protocol. the updated scrutiny is on the heels of a near-term string of safety incidents involving united airlines aircraft those shares down about 4% an analyst call on media giant and dow component disney those shares higher by roughly a percent or so, around 15,000 shares of volume barclays raised the target price to $135. it was 95. a bit of a catchup trade with those shares already topping 117. they're citing things like better recent guidance on earnings and free cash flow as well as clarity on longer term grow plans and ceo succession once the proxy fight with activist investors concludes there. for more on that story, head over to cnbc.com/pro subscribers can get more access to in-depth summaries of the top

earnings calls and analyst calls each day, becky. i'll send things back over to you. >> thanks, dom. >> how's your bracket today? i have all -- no bracket is busted >> what? >> no. >> okay. so it's good, right? it's better than the outcome that we saw last week because at least all the one in -- all the top one and two seeds are still there. so i guess not everyone can feel like they're completely -- >> yeah, kexactly. if i just hit the button that didn't stop me -- >> that was such a slam. >> right it was it was that dom did. >> good job, dom >> you don't need to slam me, i slam myself. even though i have purdue winning it all. >> you went with purdue? >> i still decided that like utah state, they've gotten this far. these are all good teams 18 points is too much. i'm going to take -- they lost by 40. >> i love it i took uconn to go all the way

that's my only hope. all my brackets are busted >> shouldn't be there with a purdue or a uconn. >> i would just say this all the one and two seeds are there. you could have algorithmically picked those things. a lot of brackets got busted early on i think the issue i have -- not the issue, i think that the biggest surprise to me is just how duke has come along. like duke looks like a contender. it's not that they're not every year, but it's been a while since duke has really been -- >> did you see georgia georgia wasn't even in the tournament i watched them yesterday i'll watch them all, nit, so you don't have any brackets busted >> my bracket got busted very early on >> oh, but it's pretty easy to not have any busted brackets because all you got to do is pick the one and twos. how many do you have left? >> i had kentucky going pretty decently >> that was smart, they lost in the first round. >> yeah. >> okay, dom >> i know. >> unbelievable. >> 'tis the season, guys

>> i know they're out right now, i love that guy. phenomenal story, five years division 2 while he was driving uber around for the whole thing too. anyway, when we come back -- >> it's fun. >> it is. pimco's head of public policy libby cantrill joins us after this break and walter isaacson will be here to talk about the eu's investigation into meta, apple and alphabet, this is a breaking story this morning, it could say a lot about what you could wexpect for future growth with these companies. "squawk box" will be right back.

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congress passed a $1.2 trillion funding bill averting a government shutdown for possible market implications, let's bring in libby cantrill, head of u.s. public policy at pimco i don't know what the prospect for governing is at this point it's almost like -- it's almost like no house -- no party controls the house at this point. >> i mean, i think it's fair to say that so just in terms of the government funding bill thrks sort of finally took off this tail risk off the table. the market hasn't really been focused on a possible government shutdown, but this sort of officially closes the door to that possibility so if you were looking for potential disruptions, that at

least has been taken off the table for the next six months or so before they actually have to start thinking about 2025 again. but joe, to your point, i mean, this took ten months basically, this -- the spending levels were negotiated as part of the debt ceiling agreement back last june, so basically it took ten months just to codify this so this house and this congress just in general has been really unpro unproductive compared to sort of historical precedent of course both the house and the senate have incredibly narrow majorities, but in terms of sort of the prospect for legislation before the election, maybe we see some ukraine funding i think there was some hope that we would see this bipartisan tax bill that was passed on a huge basis in the house, passed the senate that looks like it's sort of wutering on the vine i think the upshot for markets is tail risk has been taken off the table in terms of government shutdown we're probably not going to see much else. >> we do ukraine, mike johnson can't do that without democrats.

>> yep. >> he's already on -- i don't know whether you'd say thin ice, but you're starting to hear some of the grousing from -- what do we call that faction that's not really the crazy 8s, matt gaetz and the crazy 8s >> there are lots of names for those folks, yes >> but it's -- is that why -- mike gallagher, so big future, right? we had him on. he's even leaving -- >> earlier. >> earlier i didn't realize so that it makes leaving earlier makes it impossible for republicans to replace him with a -- or more difficult? >> because of the special election rules in wisconsin, basically the timing -- >> that's just vindictive for him to do that. >> i'm not going to sort of assume any sort of intentions. ken buck the same thing, ken buck from colorado also left, and because of the state rules in colorado, his vacancy will not also be filled until the election that just practically means that the upshot of this means kind of

for the market s is that there' only a one-seat majority for republicans right now come april 19th when mike gallagher leaves. to pass any legislation you basically -- johnson basically has to work with democrats. >> with democrats. >> that could imperil his speakership even more. >> his own demise. so why try to win the house then if you're republican i think they'd rather -- would they rather just be in the minority. >> there's a lot of privileges that go along with being the majority you set the agenda, you set the floor's agenda, you control off the chairmanship i think it's a bridge too far to say they don't want the majority this also underscores a, the polarization within the republican party and we can say the same thing with the democratic party. >> not really. >> but also it's a really -- it's really difficult to lead with, you know, one, two, three vote majority and that's what we're sort of seeing. >> the board collective always

comes together when it needs to, the democrats. >> have we reached the point -- we always said it's been conventional wisdom that gridlock is good because you don't want major things taking place, you don't want one party taking over and running too far b away from the center have we reached the point where the gridlock is so extensive and so damning that it's no longer the case >> it's such a good point. if you look at sort of market returns over the last 70 years or so, usually the market does do better during periods of a split congress or split government, meaning that kind of this idea that markets like kind of gridlock seems to be corroborated by the data however, we have gotten to a point, to your point, where there's sort of so much polarization andso much maybe apathy even. >> if you can't pass a budget, that's a problem. >> if you can't do sort of the harder things, it likely, you know, at some point may impact the markets. and i think we have some big

fiscal inflection points going into 2025, you know. it might feel like it's too early to talk about 2025, but given that it just took ten months for them to codify a government funding bill, probably not too early the debt ceiling needs to be raise instead spring of 2025, and we're going to have a $4 trillion basically fiscal cliff if congress doesn't act on the expiring trump tax cuts in the personal and business side >> we got -- i mean, we still have a lot to digest in terms of we did get a lot supposedly the biden administration brags that they got a lot done. they did get a lot done. we're going to be doing -- the doing of the done, we're going to be rlooking at for many year to come right now. do you think that not doing anything additional -- that i think type of gridlock would be good at this point, don't you think? >> obviously there are two areas where policy mmakers can effect change one is in congress in terms of passing legislation from a fiscal perspective we did see the biden

administration work with the previous congress and pass the infrastructure bill, the chips bill, and then also the inflation reduction act. so by, again, or bjective measue it was a pretty productive session of congress over the last two years, but also another lever, of course, is for the biden administration to act unilaterally, and they have done quite a bit as it relates to mergers, to regulation from a financial sector perspective, from an energy perspective if there were to be a change, say, in 2025 from a white house perspective, i think there will be relief in some of those sectors that you will see more of an absence of additional regulations to your point, jim. >> find some more people to forgive the student loans in the meantime thank you. >> thanks so much. appreciate it. when we come back, a sweeping new tech law taking aim at meta, apple and alphabet. we're going to talk about that with walter isaacson next. and later, former federal

reserve governor and possible pick for fed chair if president trump wins the white house, virswi be our guest. we'll be right back.

never mind welcome back to "squawk box," check out intel and amd this morning under pressure after the financial times reported that china would block the use of their chips in government computers you can see the moves in the stock this morning kind of tit for tat, we do this. they do that we were talking about that earlier, probably -- let's see how it plays out, but not great for growth in either country you would think. and the european union is launching an investigation into apple, alphabet, and meta. this is the first probe under the sweeping new digital markets act tech legislation the commission says that it is concerned about constraints the tech companies place on developers' ability to freely communicate with users and promote their offers we want to bring in walter isaacson, he is a tulane professor and a cnbc contributor. he's also the author of

biographies on elon musk, steve jobs, many, many other luminaries, and walter, this is really a big deal, especially after what we saw last week with the doj taking on apple. >> it's totally huge, and in some ways it's both sides of the political spectrum, especially in the united states are taking on this notion of the bigness of the tech companies for better or worse. it goes all the way back to u.s. v. standard oil where standard oil was tieing its products to other fields so that you had to use gas stations, distribution lines, and this was ruled illegal, and you're seeing it with microsoft, about 20 or 30 years ago and now apple, google, facebook are all in the line of fire. >> are what these big tech companies doing similar to what standard was doing is absolutely. it's tieing and bundling it's good for consumers. it makes it cheaper. it's much more efficient, and

what they came one back then is a standard that says there's two prongs, what harms consumers and what harms competition, and you shouldn't do either. and it's very similar because if i search google, instead of necessarily sending me to websites now, it gives me its own products where i can make a reservation. i can go to like wise, apple ties in its payment system to other things this is good for consumers sometimes. steve jobs was great at wanting to have sort of one big ecosystem that was seamless, but it does mean competitors can't come along let's remember, if they hadn't done that to microsoft when it tried to bundle search and browsing and everything into its operating system, you would not have google now. >> okay, that's a very interesting perspective, and one that makes me think this is going to have a lot more teeth than maybe some of the guests we have spoken to about this. >> we've got a lot of teeth

because you've got the ftc -- >> apple has said they're doing it because of concerns about privacy for their customers and concerns about cyber attacks coming in. can you do it for those reasons if they can't prove you're doing it for anti-competitive reasons? >> well, it's true apple is doing it for privacy reasons, and it's pretty good like buying things through apple because of that. >> right >> because it also means if you're cnbc, if you're, you know, "time" magazine or something, you do not get direct contact to your consumers because they're the ones that control payments in other parts of the world, we have these mega payment apps we're talking aboutelon musk a moment ago he's trying to make x into a super payment app where you can transfer money and do things on that these things could not work right now in the apple ecosystem, except for if there's pressure from the antitrust folks. >> your point was we're glad we have google?

no, i'm kidding. i'm kidding. >> no, but my point was -- >> how do you know that the microsoft product wouldn't have ended up being -- google's got its own issues obviously. >> obviously >> i'm kidding >> competition -- >> you're sure this is the same with apple i'm not sure that it's directly comparable to what we're talking about. >> what's happening is it's comparable to me because it's actually good for consumers the way becky said, which is your privacy is protected it's a nice ecosystem, but it's bad for competition meaning these other payment systems, other apps won't develop, and we want an america where my students at tulane and they come up with a great idea of how to do something, they don't want to have to then go to venture capitalist -- >> but most of the time the competition is from competition and entrepreneurs. i don't immediately think wow, innovation is being stifled by

these big companies. i don't immediately think. i look at the guests we have on, i look at the 50 disrupters that we always talk about at cnbc i don't think the government needs to come in and decide that apple is too good at what it does and companies by definition try to do better than their compet competitors. it becomes almost a subjective viewpoint about whether kicking your competitor's butts because you're good is better than using antitrust that is outlawed -- >> that is such a key point, in america if you get really, really good and do things, you can get dominance in your field and the law shouldn't do anything about it. but what the law says ever since u.s. v. microsoft, is you can't use that dominance say in the smartphone business to then get dominance in an adjacent or other field where you're crushing competitors. >> you don't think that the current anticrtrust sentiment fm lina khan, you don't think the

pendulum, i think they're out of their minds with how far they go. >> i think the pendulum has swung, and it's swung in a historic way, which is it used to be this two-pronged approach. hurt consumers, hurt competition. both were bad. then for the past 50 years, you had the chicago school, let's just focus on consumers. consumers no harm, no foul that's sort of the position you argued a moment ago. i think going back to two prongs, we want to frprotect competition -- >> it's like the fed having a dual mandate, but they decide -- >> dual mandate's are hard. >> we've seen the european model of protecting competitors. how does that work >> not very well europe has not been great at innovation if you want to say it's going too far, the digital marketing act, which is what's being used this morning to go after the big companies such as google, i'm little bit more skeptical. >> so i'm trying to play this out from the markets perspective because it's been these big tech

companies that have really been driving things even this morning goldman sachs is saying they're looking a at base case still of the s&p ending the year at 5200, but a team hoffof their analysts is sn we could see big tech driving it up another 15% to 6,000. if these cases are successful, even if they're not, if they drag out over a period of years what does that do for the potential of these companies >> i think your question of dragging it out over years is actually the relevant one. that's what happened with microsoft. there are very few people who can actually remember who won in the end on the u.s. v. microsoft where they were trying to bundle the browser and many other things into the operating system you know, apple lost the original case, and they didn't do -- microsoft lost the original case. but then there wasn't a remedy of breaking up -- >> bill gates why they missed out on the phone. >> what it did is constrain bill

gates from doing a mobile operating system, from doing social media well, that's good and bad. it means that apple gets the rise it means that social media like facebook get to rise we want the creative destruction of competition in this mooarket. they won't get solved -- >> we want creative destruction, but we don't want regulators to hamper companies for years, then lose the case, and oh, by the way, we got what we wanted because we tied them up. >> kill the goose, we're constantly trying to kill the goose that laid the golden egg. >> if you can't win the case, if you can't make the case, you shouldn't have been tying it up for years. >> they throw it up against the wall and nothing has sto far. >> you can go back in history, standard oil, microsoft. >> at&t. >> ibm wait a minute, they broke at&t up >> yes >> it's back together. >> it's back together. yeah >> i mean, that to me is the biggest issue. if you are doing this and you don't really have the liaw on

your side, because you just have the might because you're the government and you're big. >> they do have the law on their side. >> if they lose at the end of it, they're still effective. they still get their way. >> they won most of the u.s. v. microsoft. i think on these case where is i do a search, where do i things i want to pay for something. i want to have choice. if they force it to allow more choice, you're going to see things like digital payment systems which are very clunky and bad these days, if competition is opened up and people get to find different ways to do payments, for example. >> we had tim wu here and he basically said last week, he was one of the architects in the obama administration and even up through the biden administration in what to do with all of this stuff. he said they're not going to settle because what they want is far more than any company would be willing to give. >> and as you said, this is important, apple is doing this not just to harm competition it's doing it because it doesn't want payment systems where people's privacy gets violated

so it is complex apple has its own good motives as well as trying to protect its ecosystem. you know the apple ecosystem, and once you get in it, you feel very comfortable, but you ain't going to go out of it, that's good, that's bad. >> did you see this guy? >> charlie hustle? >> no, we had the author on. you can't do pete rose it's been done have you ever done a sports -- i don't think you've ever done. >> i don't think that would be my specialty, although i -- >> who could -- i was trying to figure out who you could do. tiger someday? >> i'd do somebody historical. i'd do joe dimaggio. >> i thought of dimaggio. >> although there are books on him that are good. >> i think i'd rather do more -- >> michael jordan? >> technology, creative people. >> because you're so cerebral. they had interesting lives they don't have to be, you know, these complex geniuses. >> why don't we collaborate on a joe dimaggio biography. >> if i'm collaborating, all my

stuff is going to be from ai >> right now i'd say write me a bio of joe dimaggio. >> in joe kernen's voice. >> walter, thank you thanks a lot ai, we want that to expand too without it being crushed by the big companies. >> we want guardrails on that too. walter, thank you. >> i'll come back. the 23-year-old already run the world. they're so much smarter in thinking about these things. >> i'll tell them you said so. >> 23-year-olds you think are smarter. >> right, it's not the 23-year-olds it's the 35-year-olds i think are clueless. bernsteis n'toni sacconaghi talks apple. who are the millennials? are they 40? without over or under investing. so you can feel confident in your financial choices voya, well planned, well invested, well protected.

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a news alert for you this morning, nelson peltz trion management withheld its vote from walt disney company's ceo bob iger when voting its shares in the busy proxy battle the firm is waging against the entertainment giant according to source who is monitor this it's hardly shocking, in recent

weeks disney has stepped up its attacks on trion and peltz with something they say correcting trion's fact with fiction. that was the headline of a recent investor presentation from disney over a picture of pinocchio with a growing nose. of course, hthough this istrion recommendations and doesn't mesh with peltz saying wanting to work with management if he's elected to the disney board. disney is stupid because i'm not trying to fire bob iger, i want to help him. that's what peltz told the financial times. he said we don't fire ceos withholding its votes from iger is hardly a supportive move of his leadership and does raise questions about how toxic of an environment the boardroom would be if peltz is elected to the disney board next month. trion is officially recommending shareholders vote for peltz and former disney cfo jay ra sue lieu and withhold their votes from maria elena and michael

froman who are current board members. if there were the case you'd still get 12 whoever gets the highest votes, the 12 nominees who get the highest votes will be on the board. trion does own a relatively small position in disney it represents about 1.5% of the shares outstanding when you combine the ownership position of former marvel chairman ike pearl mutter we have reached out to trion this morning but have gotten no response as of yet that shareholder meeting is april 3rd and trion could change its vote between now and then: my first thing on hearing this was yeah, it's probably not surprising i don't think they like each other very much and i doubt bob iger is voting his shares for nelson peltz. >> not voting for iger is different than wanting to fire him. >> it's withholding votes. it's probably a good way of tweaking, to say you're going to get less votes than other people you get it you understand interpersonal relationships in something like this >> i hold grudges for like 40

years, i was thinking about that >> i know. >> we have froman on all the time. >> the former trade representative from the united states, for whatever reason trion has targeted he and maria -- >> isn't he cfr is yeah counsel and, in foreign relations president. >> yeah. certainly -- yeah. it's not -- i know -- it kind of saying what they really mean and kind of don't say what they really mean. i don't know how it finally -- >> a wife, too. >> like sonnenfeld. >> some say exactly what they mean nelson peltz is not known for holding back a straight shooter terms saying what he thinks. in the "financial times" he talked about a lawsuit recently from wedding planners for his daughter's wedding he fired called him a bully billionaire he said, aww, they're probably right. what's the point being a billionaire if you can't be a

bully? meantime, activist investors. >> is there a list out >> no, no. different. another turn and twist in the saga activist investor blackwell capital out with a new letter to disney shareholders. another firm nominating individuals want three elected to the disney board. nelson peltz is not pushing the needs. they're pushing for jessica shell and two others to be elected. trian in its proxy says don't vote for the blackwells people either pretty important. up next, apple under investigation. talking about that the doj and now the eu ouing to talk to top analyst abt the stock. we'll be right back.

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it's not a lock, i know a lock. so how can we undo the damage? we could all unsubscribe and switch to xfinity. their connection is unreal. and we could all un-experience this whole session. okay, that's uncalled for. the european union is launching an investigation into apple, alphabet and meta the first probe under the new, sweeping new digital markets act

tech legislation joining us, toni sacconaghi. bernstein senior analyst we've seen what has been one of the great investments in history. seen at least a bit of a pause there, and, you know, typically that can be a great time for investors, or there may be the time when it finally isn't do you think this is one of those times for opportunity, or caution? >> good morning, joe so i certainly lean more towards an opportunity for investors as you noted, apple stock pulled back dramatically. the metric we like to look at in terms of valuation is, what is its price to forward earnings multiple versus the market a year ago about 1.5 times right now about 1.17 times and the average over the last five years is about 1.3 times.

well below its average despite the headlines around regulation, we think apple's fundamental business is intact in the long right now because the iphone is going through a weak cycle, but ultimately we believe that apple's busines model is intact and unlikely to be materially impacted by regulation. >> why if -- if the doj got everything it wanted, that wouldn't be material >> i don't think so in the near-term, joe, because the doj is talking about monopoly behavior for apple, but the examples it's citing are things like payments, or things like messaging, and, you know, you run those through. okay so your messaging app works better with android. does that mean you change to an android phone? you're allowed to use double tap

payments with alternative payment providers. does that mean you switch off of your, off of your iphone so at least the areas that are cited in the doj case, yes i can understand, you know, they're trying to make a claim around monopolistic behavior, but even if remediation on sort of the five examples they cite, other than perhaps the super app, we really don't see that weakening, desire to stay on the iphone the iphone is, you know, consumers are used to using it every day. they still have, you know, things like apple maps and icloud that are difficult to switch off of once you get to use them andened so, no the simple answer is, i think even if the doj place largely wins which i think will take several years, four, five years to play out, i think the average consumer in the u.s. is pretty

locked into what ecosystem they're in whether android or ios. >> i'd like to buy an android phone but would do it if it wasn't for iphone's phone. people said that foreverer is that correct? >> correct >> that's not -- i don't use an apple because i'm appreciated from using an android. that's not why what i think is so flawed about the whole idea how about the other two up there? meta and alphabet and the eu's approach to those? >> look, i don't cover either of them directly so i don't want to speak to investment conclusions, but there are lessons learned. regulation takes a really long time. you know if we look at doj cases, they've taken between three and five years, including appeals, to ultimately resolve itself if we look at what's happening now in the eu, you know, there was legislation passed that went

into effect in march, this month, called the dma. now the eu is coming back saying, hey, we're not really happy with how companies are responding to this, and they're doubling down. what we found so far his historically is the eu had mandated against google to offer a choice no impact on google today. so far, you know, the dma rule hg ruleing had no impact. they're comfortable using and it's unclear to me regulation at the end of the day is ultimately going to derail them >> yeah. the election coming up, toni do you -- we tried to handicap that i don't know how to handicap that, in terms of, antitrust teeth, or actions? do you have an opinion on which administration would mean what

to this whole area >> i think it's difficult to say. i mean, if we look at the doj case it was launched ed five y ago under a different administration and ultimately the charges were brought to bear against apple during this administration and the resolution of this isn't going to happen until, you know, the next administration. so, look, i think end of the day, you know, we basically had some bipartisan challenging of, you know -- of -- of corporate america to some degree, from a legislative view. >> okay. >> and, you know, most of the issues quite frankly are going to play out. >> all right waiting for something. i'm seeing now hit the tape. so we want to apologize. talk to you again soon breaking news on volume. get to phil lebeau joins us with

more hey, phil. >> hi, joe major management shake-up add boeing the company announcing three significant changes. start first with the ceo position ceo dave calhoun look at shares of boeing dave calhoun resigning from the position of ceo at the end of the year he's got a lot on his plate between now and then and in an employ newsletterjust sent out saying we are going to fix what isn't working at boeing. a lot is not working right now so the company will begin a ceo search, but will not be led by board of director chairman larry kelner he is resigning as chairman of the board. stays on the board through the annual meeting in may but resigns as chairman. the new chairman, steve mullencough who is on, has been on the boeing board since 2020 he will lead the ceo search. you see a picture of stephanie pope why showing that because stephanie pope is moving into the position of ceo of boeing commercial airplanes.

stan diehl had been in charge of boeing commercial airplanes since 2019 resigned. stephanie pope president of boeing commercial airplanes. that's the big position in terms of correcting the manufacturing problems that have been exposed over the last several months again, the big headline here three changes in the management at boeing. you've got stephanie pope moving in to the position of head of boeing commercial airplanes. larry kelner out as chairman, replaced by steve mullencough on board of directors leading the ceo search the third position, significant news dave calhoun resigning end of this year. lots to discuss with dave calhoun. don't miss our exclusive interview coming up in a half hour talking to him about these changes and his view where things are at boeing as it wrestles with a lot of problems within its manufacturing facility here in renton,

washington, as well as the outlook for boeing and the management in the future, where it will not include dave calhoun after end of this year guys, back to you. >> five points up so far on -- we'll see how that works the initial knee-jerk reaction on all this is positive for the shares, i guess, phil. trying to -- >> not surprised, joe. not surprised. not surprised. look, the pressure building for them to make significant, concrete, take some significant concrete action, and this is it. you are basically, you have boeing's board saying, look. we're putting new management in place. we don't know who the ceo will be that will be determined over the next several months as steve mullencough begins the ceo search no doubt involve an outside recruiting firm, but a unique skill set is required to become ceo of this company. the question becomes now what are steve mull opinion cough -- mullencough and directors

looking for? beginning of boeing saying we're moving forward what we're doing in terms of our management at least two-thirds of the management find out about the ceo later this year. >> in the past we've sort of watched it, you know, hard to figure out who would make a good ceo of a company like boeing now, mullencough is an impressive guy not very old this isn't going to be a dick cheney looking for a vice president. maybe it should be me? or -- you know, when i -- i don't think so >> i don't think so. but the last time that boeing went outsidish -- the last time, joe, boeing went outside to bring in a ceo you've got to go back to, what? 2004, 2005 when they brought -- no mulally but jim mcnernen. keep in mind previously ran ge aerospace and ge aviation. not like foreign what was happening in the world of aviation.

>> and assembly lines too. why we, in the past, explained it that way. we have talked quite a bit about changing management in the middle of something like what's going on with boeing and that sort of is why i think dave calhoun was able to make the case that, and he's still going to be there obviously seeing the company through the transition until the end of the year so you know, there's stability, but also change. >> one of the questions we'll have for dave. one of the questions we have for dave why not leave now? why wait until the end of this year now, there's two ways to look at this you could look at it full sweep. let's clean it out but let me tell you. if you were to replace dave calhoun right now who would you put in that ceo position stephanie pope in that position? you could. but also you have a question of, is that who you want to run the company long-term? >> right.

>> do you think the other approach, which is we need a ceo in here who understands everything that's going on let's take our time. let's do an outside search, and also look internally as well do that search, and make sure we get the right person as opposed to saying, boom here's the changes across the board. and -- and putting yourself in, really, a difficult situation with a new head of boeing commercial airplanes and a new ceo at the same time. >> right i can channel the stock. it's like, oh, good! it's happening up five points wait a second. who are we going to get? wow. still got a lot of problems. still got a lot to -- two points you can see the -- almost investors trying to decide and then coming to grips with this isn't going to be solved immediately just because you're changing management, eventually, now. interesting to watch look forward to that interview thanks for bringing it on the flagship morning show, phil. >> all right. right now back to the

broader markets as we get set to begin the final week of the first quarter. cnbc's senior markets commentator mike santoli joins us this morning, and , here we go monday morning coming off the best week for the dow and s&p. just since beginning of the year >> yep absolutely actually, a pretty good quarter. right? up about 10% in terms of s&p 500. continuing a great five-month run had. in fact, a five-year chart i point it out, saturday was the fourth anniversary of the absolute low in the covid lockdown crash since that point 25% annualized total returns for the s&p 500. so about 150% including dividends all told obviously not that many people, probably, have that at ultimate entry point. nonetheless shows you the market has roared back. also a bear market in between. i also like to do. the market resumes at a similar

angle after it has one of these resets in fact, steeper now getting a little bit, perhaps, over, but stayed that way. usually a sign of stronger markets and broadened out a lot. a ton of new 52-week highs last week all to the good. look here where the bull market, consider it to have started in october of 2022, this time where it sits relative to the average of the past, say 11 bull cycles blue line current cycle. unremarkable pretty much on track with typical one but tends to slow down and some markets had give-back there within that average. one thing i wanted to point out. defensive parts of this market have been nowhere. really not performed usually that's a good risk appetite thing things like utilities. however, unit day basis, utilities performed exactly in line with equal-weighted semiconductor es semiconductors as a whole up 70%. broadcom, amd roaring higher

typical semiconductor stock having a struggle. nuanced picture in terms where we are, leadership and sentiment. >> mike, thanks. see you a little later. when we come back, former president trump's advisers floating a short list of possible names for the position. and dave calhoun, exclusive interview after the news a shake-up of the aviation giant boeing stepping down end of this year "squawk box" will be right back. , we're ready for whatever gets served up. dude, you gotta work on your trash talk. i'd rather work on saving for retirement. or college, since you like to get schooled. that's a pretty good burn, right?

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be a finance and hr rock star. workday. for a changing world. billy idol just stole your golf cart! . breaking news a few minutes ago. boeing's ceo dave calhoun is going to be resigning. that comes end of the year steve mollenkopf, one of the company's directors, now named chairman of the board and will lead up the search for a new ceo. we'll have an exclusive interview with dave calhoun coming up less than half an hour's time. 8:30 eastern time. coming up next, he's here.

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. his latest op-ed writing about relationship between economic and geopolitical instability saying, massive government spending surging debt burdens and bank rescues over the past years alarmed america's allies, emboldened its adversaries and calling for what he term as new economic and security commons kevin warsh joins us currently distinguished visiting feller at the hoover institution. what do you mean >> gave me credit. george shultz is the great man came up with that framing after world war ii and described how the world was safer and the u.s. more safer and prosperous

because the united states led a new way to think of a global economy. 2024, can't go back. have to look forward, but what i read about a couple days ago is we need a new way to think about the u.s. leading the world to make ourselves safer and stronger. >> what does that look like? >> well it looks like a stronger economy. it looks like more capable economic policy so that our adversaries around the world envy the u.s. economy instead of think they can intimidate it it looks like a world that's safer, because our allies can trust us and adversaries aren't so sure what we're going to do even overnight, becky, fishing boats between the philippines and the chinese, the russians invading polish airspace as part of the war in western ukraine. this is a world where u.s. deterrence isn't working and what i tried to write about is that when the u.s. is no longer a force steady in the world, the

world looks more dangerous and comes down to negative benefits here in the u.s. >> the economy looks really good here right now surprisingly so people thinking the fed should cut rates or those worrying a recession is just around the corner, but we can't even get a budget passed over the course of ten months. finally a deal only until october. get us funded through october. is that what you're talking about? when you talk how we work together and present a stronger united front, it's hard to see how we get to that point sounds good but hard to see how we get there looking at washington these days. >> process matters institutions matter a lot. i'm a little less impressed about the strength of the u.s. economy today. the treasury department, the federal reserve for the best of intentions i'm sure are goosing this economy the economy's looked great last several quarters and probably the next couple quarters you referenced at the beginning, massive government deficits at

times of prosperity. a fed promising to cut rates even as asset prices are melting up looser policy. the rest of the world, especially allies and adversaries look at us and maybe impressed by gdp growth, impressed by the stock market but not the u.s. economic engine seems stimulated even at a time of full employment. >> to your point, leads in the "wall street journal" today about surging treasury sales and money they're going to need to continue to fund funding the deficits we're building up. >> right treasury in the last six months issued more bills, short-term bills, than they have longer-term notes and bonds. what appened long-term yields came down so long-term yields are about 100 basis points lower than early last fall. that works for a while, but ultimately this debt has to be paid during a time of zero interest rates for the last ten years most people termed out their

funding. the average 30-year fixed rate mortgage is about 3.5% but the only people that didn't term out their debt obligations is the u.s. government. so as you say. a bill to pay. >> i guess this morning one of the issues we've been talking about is what the fed's going to do next. raphael bostic now making noise he thinks only one fed rate cut this year. that's a long way from the six the street was anticipating at one point. if you're worried about the economy, what do you think they should be doing? the first thing i'm suggest is that the 19 people around the table spend more time thinking about and describing what are the factors that can affect inflation? i will say i'm a little puzzled by what their framework really is we were led to believe last year that inflation was really, services inflation and wage inflation. new index they trotted out showed services x housing

growing above 4% haven't heard about that for a while. listen, i am sympathetic to their challenge trying to navigate this economy as the world is on fire, but i think pre-committing as they do in these series of dots, each person saying how many times they cut three, six, nine months from now is deeply counter productive financial markets, productive. asset prices melting up but taking big risks with inflation. if you're living off your w-2 income, they're asking for inflation to move back higher and i think some of the data suggests it is, but, of course, if you have a large balance sheet this is a great party, but ultimately what happens to hard-working americans here matters more. >> we wait, we wait, we wait if you were to ask yourself how long you've been worried about unsustainable debt levels, all of us, it probably isn't in years. it's probably measured in decades. and it scares me we seem to

be -- to almost assume it's not going to come home to roost. we're learning -- we're not learns lessons we should be learning because maybe of the stimulus maybe it's being -- you know, glossed over by, by large from the fed and fiscal authorities but no free lunches. we think there are free lunches now. i think maybe there are free lunches now, kevin, and mt works. reserve currency of the world. we can keep spending it's working telling us every day, it's -- [ whispering ] -- it's working. a bad lesson to learn when clearly it's not going -- end well so -- >> central bankers are paid to the nervous. if i come on the show and sound uncomfortable in the state of affairs, that's our job. our job isn't to throw a party our job isn't to figure out ways to be the first central bank to cut rates into a melt-up in

asset prices i'm concerned. that's the occupation. >> i'm with you. just wondering the proponents of mmt have not been dissuaded that it works -- yet. >> so in order to be persuaded out of a position you have to be persuaded in to the position our job as central bankers think about economics not politics long-term interest rates look like they're moving up, machina long time. my hands in the financial crisis at a time of full employment the world is more skeptical of the u.s. as some shining city upon a hill. looks to me as though they're less comfortable putting all of their eggs in the american basket this is a window's opportunity for washington to put its best foot forward and to try to think about some idea of fiscal sustainability and for the central bank to recognize that

they've play add role in that, too. >> you've seen those gdp, debt to gdp forecasts no way out is there >> 66% >> i think it's 100 -- yeah. so -- >> debt to gdp by the congressional budget measure is racing over 100% that's gdp -- saw that when we won world war ii at least then funding for high-minded purposes and important roles. imagine there's another recession? imagine even that the cold war becomes hotter then we ask ourselves, taking more ricks than we should. there is a way out of it, though this isn't here just to show nothing but pain the way out of it is the american example of economic growth the way out of it is prudent fiscal and regulatory policy, prudent monetary policy. and a trade policy that says, if you are a security protector, if you are our ally and treat our citizens and businesses well, come on in

we want to be your partner i think there is a way out. >> not really a message coming from either party at this point. by the way, what is the right monetary policy at this point? what would you do if you were in charge >> right so the right monetary policy i think for those that are in charge, these are the cheap seats. first stop talking stop pre-committing to a set of policies in an uncertain world and say what we're going to do more thinking, less talking opinion if they must talk at press conferences talk about the supply side of the economy >> that i get, but what are they doing? questions about whether to stay pat, cut rates or even raise rates? based and what we've seen with inflation numbers. >> i would have thought a year ago that a policy rate of 5 3/8% enough led to real restrictions in economy activity policy rates higher than the inflation rate you guys heard me say that's the way to bring inflation down. but they got to that policy rate and they're undermining their

own rate talking like, don't worry. it won't be around much longer so i don't see the restrictiveness in most parts of the economy that they claim. >> is that the fed speak or is that because of the -- huge amount of fiscal spending we're still seeing that is coming into play all the time. >> in a word, "yes." that fiscal spending is in ways because the federal reserve has canceled the market signals. have said we're going to be buyers of that debt. the fed even, even late into this cycle, buying debt when they shouldn't have been when it was really a crisis era. all of those things, but i think that when washington looks to be a bit messy it is the fed's job to be the adult in the room. listen, i think they're in a difficult situation. i think they're in a more difficult situation than i think they think they are. remember, it was only a couple years ago inflation was running around 1.7%, and their hair was on fire.

we have to get inflation higher. now inflation, at least by most measures, is running well above their 2% target. yet theyguine about that. >> we have had -- we are a shining city on a hill and can do it again. you mentioned it i can see how we could get rid of some regulation, but the spending we're doing and the the amount of revenue that we're raising, we got to address that, and i know you said you don't want to be political, but you saw the tax increases in the biden budget i don't think that's the way you engender growth, but i don't know how you cut the deficit without going -- how would you do it? without addressing revenue and spending where do you think we should err on that side >> so the government is 40% bigger today, joe, than the day before covid if we know one thing in economics we know when the

government gets that big, it is negative correlated with economic growth. >> right. >> the government is going to be crowding out the proper allocation of capital. start there. >> stop spending but with -- it's so hard. >> with respect to the budget, the president's budget, i will say there's two numbers in it that got my attention. first, in his forecast, in the administration's forecast, the government size relative to gdp at about 25% we have never seen that in united states history and that's on a permanent basis what about revenues? revenues about 20% of gdp. there's two problems with that one is, we have never sustained u.s. revenues that high relative gdp, meaning as we try to bring in those revenues, it slows economic growth. so those two numbers are alarming and in a final way, which is that means you have a long-term structural deficit which assumes in the president's forecast ten years of peace and

prosperity i wouldn't bet on that i can hope for it. do policies to encourage it, have a new economic and security commons, but i think it's problematic and i think as a central banker we should stay in our lane, but our lane really means trying to have a steady set of policies now as opposed to encouraging another party. >> playing us out, kevin we'll have you back again soon, but thank you very much for coming in. >> thank you, becky. thanks, joe. >> thanks. up next, ceo dave calhoun live on this hour's news stepping down end of 2024. stay tuned bcn re watching "squawk box" o cn.

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breaking news from boeing. ceo dave calhoun steps down end of this year get to phil lebeau standing by with dave calhoun. hey, phil. >> thanks, joe dave, thanks for joining us here you heard what joe said. it stepping down end of this year why now and was this completely your decision? >> yeah. first of all 100%. why now? i've entered my fifth year end of this year i'll be close to 68 years old. i've always said to the board and the board has been very pre prepared i would give them plenty of notice so they could understand and plan succession in regular order that's what this is about.

it's me giving them notice that end of this year i plan to retire and then, them taking the actions that they've taken i'm actually very proud of the way the board has handled everything very deliberate. the move with larry, in my view, very deliberate. the entry of steve as new chairman very deliberate all very qualified and great decisions. >> if you're going to be leaving, some will say, why not just leave now why wait until end of the year >> we have another mountain to climb. let's not avoid what happened with alaska air. let's not avoid the call for action let's not avoided changes we have to make in our factory. let's not avoid the need to slow down a bit and let the supply chain catch up we've got to get at that just like we got at the rest. and we will get through that we will get through that and i've committed myself to the board to do exactly that. >> you've got two other big management changes talk about the board changes in a bit, but stan deal stepping

down. >> yep. >> resigning as head of boeing commercial airplanes stephanie pope coo moves into that position. >> yep. >> what does she bring to the table different from stan? >> big thing, first of all, stan is retiring. this is all about the clear path to give our pest best people internally an operation to shine in front of the board and demonstrate everything they can do stephanie's track record speaks for itself they has been a leader in every position she's had, seen every part of the economy. most recently led our global services business. in services both our military customers and commercial customers every day, all day taking calls, responding doing the work she has really differentiated herself. so the move we made end of the year to put her into a chief operating officer position was a very deliberate move. >> as you know, just last week airline ceos went to your board. went to larry kellner and said,

we want to meet. we want to talk with the directors directly but we don't want to hear from dave calhoun we don't want stan deal in this meeting. your reaction when you first heard? >> take issue. i know all the people they call and talk to them all day every day. i don't think anywhere near that kind of messages our board and i talk to our customers every day, all day we've had a ceo come in and talk about the accident talk directly with the word and i volunteered to leave that meeting because i want clarity i want transparency. what we all want so, yeah i -- i understand -- you know, put this in context. they run an every day, all day business i run a long-cycled development business and a long-cycled production business that has to deliver them a perfect airplane. those two things when they meet and collide it creates this kind of environment

and that's the environment we're in, but i listen to our customers all day. >> do you understand their frustration? i heard from airlines. they said we want concrete action and concrete steps to make changes >> i think the news that brian westhead, delivered just earlier this week that the financial community, about the slowdown in our factory, our determination to get ahead of that, i think that will demonstration and be app app app proof point to get ahead of it. >> are you resigning end of the year >> never preempt the board in communicating to anybody but the faa is with us all week this week. we will go through a 30-day plan with them. then 30 days later go through 60 and 30 days later through a 90 and have to demonstrate progress in each of those moments. it's a pretty constructive approach for both from the faa and for our team. >> last week mike whitaker

interviewed by nbc saying when out here what he saw was a culture of move the product. move the plane it was not a focus on quality control and safety management. >> yeah. >> what was your reaction when you heard those comments >> well, i recognized exactly what he was talking about because i heard it from our own people remember, we did a stand-down immediately after the accident and we listened to all of our own folks. and we had a bad habit in our company and actually in many large companies that have to assemble big products. when you do work out of a position, message you send to people is, maybe that work was moved because of a shortage. maybe because you are trying to fix someone, non-conforming. you move it down the line sends the message, wow i guess movement of the airplane is more important than the first-time quality of the product. we have to get that in way more

balance without a doubt. >> you've been on the board since 201, 2011. not a new criticism of boeing. that you're about pump the product, pumped ed product, pud product and not about quality control. ho do you change that? >> slow things down. you catch up reminder in 2020 de weren't produce any airplanes in the max line zero started the line back up, and slowly increasing our rates. at that very same time with insatiable demand on the customer's side had a very sporadic supplied side these forces that have been with our industry for a long time probably got even more pronounced without a doubt. so our job has to be to sort of say, no. raise our hand everybody has to be able and capable of raising their hand and stopping the line if they have to. that is -- that is the premise

for going forward. >> larry kellner stepping down chairman of the board. stay on the board until annual meeting in may steve mollenkopf, steps in to lead the ceo search. there is a narrative that is out there in the investment community that the board of directors have not moved quick enough should they have moved faster with these changes >> yeah. no not in the my opinion. this is a very long-cycle business nobody is more aware of the mountains that have been climbed and the remedies put in place than the board they want to go at the right pace and want to do it the right way and do it with real foresight and want to see people demonstrate their capabilities in position. so that set of moves we just talked about, in my view, puts them in the very best position to make those decisions over remainder this year and ready to go beginning of next year. >> will you weigh in, share thoughts who might be the next ceo? >> yeah. of course. of course. >> and what would you look for >> nothing more than a board

voice and will always, always defer to the chair and the governance committee to make those decisions. >> what would you look for >> well, i, i want somebody who knows how to handle a big, long, long cycled business like ours it's not just the production of the airplane it's the development of the next airplane our next leader is going to develop and call out the next airplane for the boeing company. it will be a $50 billion investment that will all happen on that next leader's watch. so i would like somebody who clearly has experience inside or industry. >> a couple weeks ago ntsb chair homendy askeds about the incident with alaska airlines and said you're basically not being forthcoming. noted word "stonewalling" but the implication was there. your reaction to that? >> a reasonably harsh statement and not perfectly accurate

on the other hand, chairperson homendy and i talked several times since that, that hearing we have agreed with one another that the minute, the minute, we thought we were being less than transparent or less than responsive we would call one another and i haven't heard from her since. >> was she over the top saying you were -- >> i'm not going to say that what i am going to say is these professional teams on the ground, the pace with which they solved the issue of what happened, definitively, remarkable it's, in my view, one of the best investigative efforts seen in my history of aviation. >> right now capped 38 per month by faa you're not there now not anywhere close to that rate. do you get to 38 by end of the year >> definitely not going to answer that question what the faa wants and more importantly i want, a system

under control every step of the way. whether 38, 52 or 16 doesn't matter it will be under control we will not travel work to anywhere near the level that its been traveled and let this supply chain catch up to the demand that's the way we have to do it. >> spirit aerosystems in the midst of negotiations. when might we see a deal >> i hope soon yeah i hope soon. we're making progress. the teams have worked closely together we have to get to real agreements. yeah i hope it's soon it's very important. and it's, it speaks directly to the subject of travel work non-conformance management, all of those things. dramatic actions taken pat is doing a fantastic job dlo down there responding to the last aftermath. >> now sorting out and acquiring a company with a whole slew of

problems that's a big enchilada at a time you're trying to get your ship in order are you worried? that's a lot to take on at one time. >> what you just said is why we do it. to get our ship in order it's a critical supply for us. critical it's our fuselage. you go out in the factory first thing you see our fuselage it's a boeing fuselage our job, make sure mechanics and engineers freely travel between the shop floor and the design effort, and if they can help one another every step of the way. vertical integration is the only way to accomplish that. >> final question. you've been around the block a time or two. you've seen companies go through crises. >> yep. >> where are you in the process of coming out of this latest crisis when it comes to the max in quality control >> let me start with companies going through crises. this company and our people have responded to the crises like --

like no group of employees i've ever, ever seen or been around they got over certified the airplane started a factory from zero create add shadow factory to get airplanes back into the field. they created another shadow factory to basically rebuild all of our 787s. 100 of them. they're up to the challenge. we will get ahead of this one. we are at the early stages of responding to, in my view, an overexercised supply chain and an overexercised boeing factory and we're going to calm it down, get ahead of all issues that are by the faa and our own people bring to our attention, more importantly and we'll get ahead of it. that will happen. >> dave calhoun, ceo boeing. retiring end of the year back to you. >> all right phil, wide-ranging dug into so many different areas, and i think people will talk about this for quite some time this is some major news at

boeing, which has been under pressure we'll see how the market continues to react to this again, phil lebeau with dave calhoun from boeing on the news that he is going to be stepping down at the end of this year, that he's planning to retire much more on all of this coming up in a little bit talk about what it could mean for the stock as well. "squawk box" will be right back. (grunting) at morgan stanley, old school hard work meets bold new thinking. (laughter) at 88 years old, we still see the world with the wonder of new eyes, helping you discover untapped possibilities and relentlessly working with you to make them real. old school grit. new world ideas. morgan stanley. ♪ ♪ old school grit. new wnext.ideas. next. stop. we got it?

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breaking news. eu regulators launching investigationing into apple, alphabet and meta under the block's digital market act steve koufax joins us with more. >> a really big deal because this law has only been around, what 18 days? eu is already looking into these, what you just mentioned for non-compliance the big one apple, of course, what they've been doing. little things they're looking

at like whether or not they're in compliance by selecting default browsers on the iphone the big one is the app store, of course and this challenge to these new kinds of fees apple is attempting to charge developers if they go outside the app store and try to put their own app stores or download straight from the internet this is what's really making developers upset over there and the eu also. becky, say you want to create an app. you want to create -- it's a free game that you can buy in-app purchases extra items and things like that if you want to use an alternative app stores and people download, every time you download the app apple will charge you 50 euro cents driving ec nuts and looking into whether or not this complies apple says, yes fee necessary to maintain the platform a core technology fee. the one to watch and investors should pay attention to.

>> necessary to support the platform we built the infrastructure cost money to be on it and this is how you have to do it? >> correct. >> i keep trying to put this in the real world instead of digiting at&t running traffic over our network we spend money on the network going to have to pay to support it >> that's exactly it and then the -- or, for example, like target. if you want to be an end cap at target, you have to pay us a little extra to show your product there. what apple also does is -- they've changed their messaging around that. that access to all the technology that apple provides, they charge developers 99 bucks a year for that. historically, that's been the core technology fee. they've always said, it gives you access to our developers conference, lets you into the ecosystem. now what they're saying in the eu, you have to pay that $99, and if you go outside the app store, there's that extra fee. if you have a really popular app that goes unknowingly in one of these stores, you could end up

owing apple more money than you're making in the app store that's what's making the ec crazy. >> does this sound like something where there could be a settlement reached, or both sides have dug in their heels? >> there's some heel-digging the meta one is really interesting. what they've done is if you want to use facebook or instagram in the eu for free, you basically have to tell them, yes, you can look at my personal data, you can track it and so forth. if you don't want that, they force you to pay for the service without ads. ec says that might not be in compliance meta tells us, this is a common business structure that people use all the time you pay for no ads >> the thing that cracks me up is it's admission that you are for sale, basically. >> yeah. >> to me, this was, okay, stop thinking you're getting anything for free there is a price, and that price is going to be your privacy. now they're actually putting a price on it.

>> the eu says, you can't track people in this way without their permission, and facebook says, well, we can, but they have to pay if we can't track them that is going to be the key issue there. on the google front, it's -- and amazon front, it's very similar. it's all about, you know, favoring your own products over others this morning, i was loading up on allergy medicine ahead of the spring allergies i type in, you know, allergy medicine, into the top of amazon, it gives me the amazon brands first if that happens in the eu, the ec does not like that. they want to make sure everyone has an equal playing field in these big platforms. >> going back to the real-world scenarios, then, how is this different than costco promoting their brands >> that is the argument amazon has been making here in the u.s. and all across this is exactly what they're saying that's also huge business for amazon they charge ads, so when you search toothpaste, maybe crest shows up they're going after all this >> it's a lot. >> and they're moving quickly. 18 days, they're already saying,

uh-uh, we don't think you're in compliance here, and by the way, 10% of global revenue could be the fine for all these companies. >> wow steve kovach, thank you. >> flonase >> i use nasonex >> is that the amazon brand? >> no. >> but it's like flonase >> same thing. >> better than the pills >> i use it all. i use the eyedrops >> but you don't use claritin? >> claritin hurts my tummy i use allegra. >> viagara oh, i misunderstood. >> that's you. >> that's me when we come back, much more on the markets the futures this morning are still in the red this is close to where we started the morning. dow futures off by about 90 points nasdaq futures down by 100 the s&p futures down by 18, but of course, markets are coming off the -- the dow and the s&p are coming off their best weeks so far this year you're watching "squawk box," and this is cnbc

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let's not avoid what happened with alaska air let's not avoid the call for action let's not avoid the changes that we have to make in our factory let's not avoid the need to slow down a bit and let the supply chain catch up we got to get at that, just like we got at the rest, and we will get through that, and i've committed myself to the board to do exactly that. >> boeing ceo dave calhoun on "squawk box" earlier this hour on the breaking news that he'll

step down at the end of the year joining us now with his take on that news and everything else, michae michael landsberg, chief investment officer at landsberg bennett, private wealth management, an affiliate of hightower. boeing is not one of the magnificent seven, but it surely is our premier manufacturing company in the united states were you paying attention, michael? does it matter on your view for the overall markets? >> overall markets, no unfortunately, boeing has a great history, but in the last six, eight years, they've been a culture of carelessness. my problem with that company is they keep promoting people from the inside, and calhoun was on the board when we had the max-7 problem, and to me, unless they pick somebody from the outside who brings a strict regimen to quality control, i wouldn't touch this stock we haven't owned it. we won't own it again until we get an outsider, because quite frankly, they're not doing a good job internally.

>> you give our people here some names you're excited about for people that want individual names, what are your four favorites that you gave us or four that you like >> i mentioned synopsis, one of the leading kind of players in eda, which is an automation software it's got a nice business, and they've got a little bit of an a.i. kicker, so i think that's an interesting stock that gives you some a.i. exposure without having the a.i. risk of all or none it's an interesting story. i like o'reilly automotive, a nice mix of commercial business, as well as do-it-yourself business double-digit eps those are my large capex poeshs i w -- exposures. i like axon. they make tasers they make body cameras, and that's where we're going in this country. if you see police officers making arrests, they're going to need to protection of having a camera to document what's going on also, a taser is nonlethal, and i think that's an area that i think more and more are going to

have to push towards in this age of people getting sued, and there are some bad police officers, so the idea is for the vast majority that are good, they're going to want to wear this technology to kind of clear their names. and the last name's an overseas name, a german defense maker, and obviously, we'll be doing well and has been doing well given what's happening with the war in ukraine munitions sales are up roughly 20%. it's continuing to ramp up, and this is the way you can play this reloading of military in europe we think, unfortunately, this european, ukrainian situation drags on a little bit longer, and you're going to need replacement weapons. >> very good, michael. i didn't even tell you short and sweet, but that was short and sweet. it was perfect we'll take maybe macro, maybe topdown some other time, but suffice it to say, you're probably already buying -- you're probably always buying things that you like to some extent but we appreciate it thanks see you soon final check on the markets we're down on the dow 300 on

friday we're down another 80 this morning. the nasdaq is up hard to imagine it being up this morning. all we did was talk about regulation here or antitrust here or across the pond. >> those big stocks weren't down by much. >> no. wait and see >> join us tomorrow. "squawk on the street" is next ♪ first of all, 100% why now? i've entered my fifth year the end of this year, i'll be close to 68 years old. i've always said to the board and the board has been very prepared, i would give them plenty of notice so that they could understand and plan succession in regular order, and that's what this is about. it's me giving them notice that at the end of this year, i pla