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 and andrew ross sorkin is reporting live from paris. he's got the back drop to die for. it is gorgeous. andrew, why don't you explain what you have coming up for us today. wow. take this shot full because it is really nice. >> becky, it is really nice. i'm live in paris this morning at the champs elysées. technology and business conference brings together thousands of tech companies. ceos from all around the world traveling here.

a lot of excitement building for the 2024 olympics which is 55 days from now. we will all be here together. we have more on the big events in a couple of minutes. i should tell you a lot of news coming out of france this morning. president macron going to new c caldonia where there have been riots going on. it is the third largest producer of nickel. a lot of folks paying attention to what is happening in the french territory today. also news out of france where the country says it will be supporting the international criminal court which says it would like to issue arrest warrants for prime minister netanyahu of israel and hamas. we will discuss all this and more throughout the broadcast today. >> wow. andrew, we have a ton to talk about. joe just mentioned the scarlett

johansson news with a.i. and the big issues coming from that. we will talk about all these things coming up. >> are you scouting locations for us? we appreciate that. this is the first. is this a good one, you think? is that somewhere we might want to consider? >> i think this could be our summer spot. we could do this on an annual basis in the summer. we could move the show over here for a couple of months every summer. no question. this or maybe italy. >> the amalfi coast. that's pretty nice. for the olympics? i don't know. we may want to be higher up. keep looking. keep looking. you have some time. there's andrew. >> all right. let's check on the markets quickly. we will go back to paris and

talking about all of these issues andrew mentioned. right now, it is a mixed future. dow up 16. the s&p futures up 3. the nasdaq down by 7. it was a mixed picture at the close yesterday. the dow was actually down. you saw the worst performance for the month of march. it wasonly down .50% -- for the month of may. down .50%. that tells how strong the markets have been. let's check on treasury yields. loretta mester no longer sees three rate cuts this year. the ten-year yield at 4.42. and crypto. now ether is leading the group higher which is up 18% in the last two days amid speculation that opposition is easing among regulators toward approving one or more of the spot etfs.

trade directly in ether. bitcoin is back above $71,000. i haven't looked at it. it is just below $71,000. andrew. joe, we should talk about this one because i think this is making news around the world, frankly. when asked about successiosuccession,. jamie dimon, he said retirement was five years away. he said the typeimetable not fi ye years anymore. he said the succession plan is on the way and the company is moving people around. among the short list is marianne lake. con ssumer bank ceo. and we have jennifer piepszak.

it is is likely dimon will stay as chairman. one date to think about, folks, is the opening of jpmorgan chase's new headquarters which is being rebuilt on park avenue. the expectation is a 2025 event. that is something jamie dimon has been inn mtimately involved. you can imagine the ribbon-cuttings and the like may think or serve about the timing when this happens. i imagine it will happen after that. >> he has been shepherding for quite a while. making its mark on the manhattan skyline and this is the legacy that they are passing on. it was interesting when he talked about this yesterday. he said they have so many people

who have moved through so many sections of the bank that he thinks they have done a phenomenal job on succession planning. they have a deep bench and a lot of understanding from the investment banking side and worked in all of the an arenas. >> how long ago was it he got sick and conjecture? he's fine. we have done this before. counting down of jamie dimon. >> just the first time he said it is not five years away. >> his demise has been exaggerated. has that been ten years already? maybe not ten. six or seven years. >> that was in 2020, i believe. >> was it only four years ago? >> really? >> wow. >> i want to say that was the timing. >> two different issues maybe? >> i remember he talked about it at different times. >> there were two instances if

you go back -- never mind. lowe's coming in at $3.06 a share. that is better than the street was expecting. revenue of $21.36 billion. that is a beat. comparable store sales down 4.1%. that was better than the 5.5% the analysts forecast. the decline in do it yourself spend was offset by positive comp store sales in pro and online. lowe's is affirming guidance for the full year. we will continue to watch that. that stock right now is up 1.25%. >> ten years ago, andrew. i was talk about when he had the throat cancer that was curable. he was 58. that was ten years ago. >> i realized when andrew said it --

>> the different succession. >> he had another health issue. >> i remember it was throat cancer back then. >> joining us for more on this is brian nagel at oppenheimer. let's talk about what you see in lowe's earnings. better than the street's estimates. what are you expecting, brian? >> good morning, becky. i'm looking through the results now. they are definitely better. modestly better than pictured, but still weak. as you said in the opening, lowe's down 4% comp. down 5% or 6%. better there. earnings beat expectations nicely. better than expected. like we were talking about home depot a week ago, this shows the ongoing struggle in the home

sector. if i'm looking at the comments from the press release, i hear them saying the internal initiatives are well, but fighting a difficult back drop. >> when you say lowe's is not designed for comps down 4%, what do you mean? they can't turn a profit? >> the company is solidly profitable. it generates a ton of cash. that's good. in order for them to leverage their expense structure, this is true for most retailers, you need comps in the low single digits. lowe's doing a comp down 4% is what i like to call sub. that is not what this company is designed for here. in order for the company to operate properly, you need a low single digit comp. we are still a way away from that. >> even when you are talking about coming off such high comps from before? it's a tough comparison when you

look at the spending people were doing during the pandemic when they were staying home and not traveling. >> i maintain that's the biggest problem. i'm talking to our clients every day on the home improvement and wondering what's going on here. to be clear, there is underlining confidence. the consumer is not as confident as it once was. the biggest factor for lowe's and home depot and frankly for a lot of the other companies that benefitted during the pandemic is we're lacking past that boom in sales. >> that's the biggest issue. you have to wait for the stuff to break and if you bought a new washer and dryer or dishwasher. nobody is upgrading phones because they did the upgrades recently. >> that's exactly right. i totally agree with that

comment. a lot of home improvement projects were taken during the pandemic. decks or kitchens and bathrooms remodels. it takes a while for that to be replaced. we have some time here. >> in the meantime, where do you think about where the stock is priced at $234? >> i still think lowe's is ahead of itself. the stock should be lower. if you look at the multiple standpoint, it's 19 times. i think the stock is still ahead of itself. the story behind that is and this is changing because it wasn't that long ago where lowe's was higher. i think the market is too optimistic on the prospects of second half of 2024 recovery or some recovery to 2025 as the fed starts lowering rates. >> the fed lowers rates and it gets to the point where people starting able to move and home sales go up and that gooses the

number of home projects again? >> that is a big piece. you would have lower leveraged rates on home equity lines of credits which is a source of home improvement. in my mind, i look at lowe's and home depot and the channel, rates have to get lower before we see the unlock. we have a way to go. >> okay. brian nagel, thanks a lot. we appreciate you being so fast as the numbers are hitting with the analysis. >> thank you. coming up, we will talk about two two pandemic darling stocks that plunged in the past year. peloton and zoom. and scarlett johansson threatening action against openai over the chatbot voice. details are next. ♪(voya)♪ there are some things that work better together.

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welcome back. we are watching shares of zoom video beating the street's expectation. it was based on the rollout of a.i. products. zoom raised the full-year forecast, but the current quarter came in weaker than expected. the stock off 2%. joe. peloton shares plunging 12%.

that's not much. 12%? it's a penny in extended hours. it has regained ground. the company announcing a global refinancing to stave off a cash cr crunch. you remember the call last month. barry mccarthy is stepping down and will layoff 15% of the work force because it, in its words, had no other ways to bring spending in line with the revenue. the market cap of the pandemic darling stock now falling below $1.5 billion. still seems like a lot. microsoft introducing a new a.i. software set and computers with advanced chips from qualcomm designed to run without awe an inter net connection. we will talk more with joanna stern. the processing units where the

a.i. is on the chip on the computer. in other a.i. news, microsoft-backed company openai is responding to legal action from scarlett johansson. the actress staaid the voice of the chatbot sky sounds similarly to her's and news outlets could not tell the difference. >> i don't have a seat, but you get the idea. >> scarlett johansson was asked to voice that system, but declined. when the demo came out, she was shocked and angered it sounded like her voice without her permission. pretty generic sounding voice. >> i would need to hear more. >> i won't know. if it was you or me. after her legal counsel sent letters to sam altman and o

openai, they agreed to take down the voice. >> first part sounded like her voice. the second part, not as much. i need to hear a longer clip to tell. >> the voice of sky was not meant to sound like scarlett johansson's voice. the voice actor was chosen before reaching out to her. he said they paused using sky's voice in the products and apologized for not communicating better. scarlett johansson pointed out that altman tweeted the day the demo was released with a single word. "her." that's the title of the movie which scarlett johansson voiced the chat system who forms an intimate relationship with the joker. >> clearly trying to go for that. >> the joker, you know, had an -- if you haven't seen it. >> that's more than i want to know. >> it will be a joker. they left it. he was amazing in a sick way.

a great actor. >> this is an interesting question. this is where you have so many content makers who are so upset and concerned about a.i. and whether that be p puublishers o authors or film stars and actors and actresses, they are so concerned about what happens because once you take a.i. and make it sound like you and look like you, steal the content you have written, it happens. i need to get paid for that. >> you would not get voiceover ain animated films. >> this large language model is being trained. writers are furious about it because they are making money off it. they would say we are not making money off it, but now?

>> you can have morgan freeman. >> or james earl jones. >> or vingh rhames. >> that will be a sticky and difficult thing to prove on either side. >> willie nelson. not quite twangy enough. i can't do willie nelson. the idea that he tweeted out "her" clearly implies they were shooting for that even if it wasn't her. they reached out to her. i can understand her frustration. >> gave up the ghost there. coming up, cybersecurity stocks tumbling. we'll tell you why. next, quarterly results from macy's and the instant

reaction -- the stock reaction. i don't think we feel that much one way or the other how it goes. i'll have zero reaction to macy's. the stock line when we come back.

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look at subscription revenue and not billings. anyone having deja vu all over again? the tepid forecast weighing on other cybersecurity stocks. we were in davos. it wasn't him, but someone else from palo alto. they told us don't look at bookings. look at other metrics. then they have disappointing numbers. this was two or three months ago. >> it was january. >> it was the last quarter. this is two in a row where what they are talking about, we referenced it in the interview. you remember that, sorkin? i remember it clearly. >> i do. >> i remember it clearly. >> i remember it more clearly since i'm on the other side of the atlantic and feel close to it. >> state dependent learning. you are close to where it happened which is cool.

that's pretty amazing. you're back with us. that's good. >> meantime, let me bring you new numbers from something happening domestically. trump media technology group reported a net loss of $327.6 t million in the first quarter with total revenue of $770,000. that's not a misprint there. the revenue was $770,000. theceo stating the company is exploring a wide array of initiatives to build out truth social and m&a platform. it has signed contracts to host the tv platform. the quarterly filing was delayed after the former auditor was charged with fraud with hundreds of companies, not just truth

social. i don't know, guys, can you have a company with only $770,000 of revenue in a quarter that's worth $4 billion? >> what was the loss number? you said it was $400 million, wasn't it? i'm trying to figure that out. >> $327 million. that's what i'm saying. i'm saying just -- i'm sorry. it is hard for me to make sense of any of it. >> it is weird. >> not a political statement. just math. >> it is like a decimal point mistake. it looked like someone messed up their notation. >> i love hearing the sirens there, andrew. the different sirens. >> yeah. >> sights and sounds from paris. >> do you have clearance to be where you are set up there? >> there's security. >> and security. they may be coming to say

something. >> we have an amazing team here. we have an amazing team. we have a bunch of people. we talk about having a studio audience. we have a studio audience here to today. we have folks around us watching in the streets. >> i guess we do the same thing here. we have times square behind us. >> andrew, does anyone have a beret? look around. do you see anyone actually wearing a beret? >> yes, we have a group of police force over there that are -- they are heavily armed. they are wearing berets. i don't know if you can move the camera. >> the line was too long one of the times we were there. you can go up there. have you been to the top? you have to do that, sorkin. >> i have been to the top. i have been to the top. i don't think we're going to have enough time this time around on the trip. >> he's been to paris.

>> he has. we'll always have paris, andrew. are you wearing blue? germans wear gray. you are wearing blue. we are going to continue talking about these issues and calpers taking on exxon in the next shareholder meeting. that story is coming up after the break. as we head to break, let's look at yesterday's s&p 500 winners and losers. >> announcer: executive edge is sponsored by at&t business. next level moments need the next level network. to start a business, you need an idea. it's a pillow with a speaker in it! that's right craig. a team that's highly competent. i'm just here for the internets. at&t it's super-fast. reliable. you locked us out?! arrggghh! ahhhh!

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good morning. welcome back to ""squawk box" live from the nasdaq in times sq square. becky and i are here. >> you would say -- >> it's becky and me.

>> right. right. >> people mess that up all the time. >> i have to slow down. >> they throw an "i" in and it should have been me. checking the futures this morning, you see up 20 points. s that danasdaq hit a new high yesterday. dow down. california public employees retirement system known as calpers is taking on the exxon environmental investors. the pension manager said it would vote in opposition to all of exxon's board nominees and the ceo at the next week's shareholder meeting. calpers cites the ability to quash the two experts. the activists submitted a p proposal to force the two to

reduce emissions. we talked to darren woods about it and he said they are not investors, but buying a small number of shares to vote and vote and vote and bring these issues again and again that the company has routinely voted down. anyway, this lawsuit that exxon brought prompted the company to withdraw the proposals, but exxon continued the lawsuit. we have spoken with woods about that, too. he said they are doing that to prevent the activists from submitting proposals again. calpers says this threatens shareholder action. exxon said to cnbc that the activists are attempting to silence tvoices of 90% of shareholders. woods said they are taking this because they want legal rulings and precedent to set the rules of the road. this is the new thing the s.e.c.

changed a year and a half ago. it would be much easier to bring shareholder proposals. it is a headache for management who say the majority of shareholders are not interested in and it sets a precedent. andrew. meantime, becky, i'm live in paris this morning. the arc behind us. we will see the olympic torch on bastille day on july 14th. it will run along the famous streets with champs elysées behind me and it will move through in a spectacular summer olympics. the competitors will be in 35

sites across france which are being transformed as we speak. you can see the working done. the french saying they raised 96% funding for the games from the private sector. that is interesting. the olympic center is within walking distance to the volleyball. it will host the french fencing matches and at the end of the champs elysées is the host of the new games such as break dancing and skateboarding which will make their first time role in all this. it can hold 40,000 spectators. versaille will host the

equestrian games. we will be here with the whole nbc team gearing up for the big moment. two weeks at the end of july, guys. start packing now. >> yup. >> i haven't started packing yet. thinking of the sustainable games which is great idea. it will be beautiful. i think there are questions how you get around to these places with logistics. logistics is an issue at any olympic games. >> effectively, by the way, becky, the streets are going to be shutdown to regular traffic. most people to the extent they will go to parts of the games and doing it by public transport, there will be some vehicles, badged vehicles, to get around to help athletes and

other folks. including us. for the most part, it will not be a traffic jam, if you will. they are trying to spread things out in a remarkable way. just the sustainability piece. some have built the remarkable structures to the olympic games and they become ghost towns. that is something the olympics has tried to avoid in this city. not only the 96% being funded privately, but they are not creating enormous structures. i hope we see this a lot. you can see it in terms of what we will see in 2028 in l.a., which is where the next summer olympics will be held. same story. one reason they were selected is for that reason. they had been the host of the olympics before. >> i remember. >> that is something to look forward to. >> i lived there and people

thought it would be a disaster as far as traffic. when it was all said and done, it was amazing. that is where hugh got his reputation from how well the olympics went. >> paris in august is really quiet. the right time to be holding the olympics there if you are shutting down the roads, theat' when the locals get out of town. >> and salt lake city olympics. if you can run the olympics and do well over there, andrew, big things open up for your career. this is a good start foryou. you look good. >> i like the wide shot that we saw more of the back drop. that was good. i saw the whole arc. >> you want the whole live shot? give her an extra wide spot space. we will give you a little bit more of that as we speak.

a nice way to segue to the customers break. when we come back, we have more on "squawk box." we have a month to go before the first presidential debate. politico's alex thompson will join us on "squawk box" when we come back from pisar and the nasdaq in just a moment. your shipping manager left to “find themself.” leaving you lost. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire ♪♪ rising costs. selective coverage. for countless americans, the complex specialty care they need has always felt... just out of reach.

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we have breaking news this morning. singapore airlines says a person has died and many others injured when a flight from london to singapore hit severe turbulence. the boeing 737 er was diverted to bangkok. this is the first we are hearing about this. one person killed. many others injured when a singapore air flight hit severe

turb turbulence. wow. meanwhile, president biden, at least you could make the case that he's attempting to move closer to the middle tof the aisle, i wonder why, as he focuses attention that former president trump -- i don't know if he had success with them, but he made them issues. the border, china, relationships with ceos. joining us with more is alex thompson at axios. alex, a lot of cross currents today, the commencement speech at pmorehouse, has gotten a lot of commentary. that did not seem to signal any sort of conciliatory tone toward the middle. do you agree with that?

>> well, joe biden is trying to do a little bit of both. like a politician, he is pinched by the left and middle right now. you are seeing one day he will go and try to shore up his base. the next day, he will try to reach out to moderate voters in wisconsin. what you are seeing here in terms of moving to the middle t, what is striking, on some of the issues, especially with trade, the middle has completely changed in the last decade. the pendulum swung so fast from the bipartisan consensus of free trade to now the bipartisan con sun consensus to trade wars. it is the not trade wars are bad, but he will do them better than trump does. >> alex, now reaching out to ceos, but now trying to deal with the fiasco claiming he came

into office with inflation at 9%. that didn't really -- that was called out almost immediately. now, again, i heard yesterday all about corporations gouging and reaching out to corporate ceos. it is gouging and reaching from the hip and scattershot. the polls are all saying the same thing. >> i think scattersho, iscatter right way to say it. the white house is trying to message on inflation and the go-to moves. especially the first two years with inflation happening was to ding ceos and corporate america. what you see under jeff sein, they are reaching out to corporate america in the last

six-to-eight months, this is driven by zeintz. not only was the white house hostile, but they didn't know anyone in the white house. they didn't have the cell number of many people at the top. to your point, they are basically still doing some of the old messages on inflation and ding corporate america and the same time trying to rehabilitate the relationships with the business community. i think a lot of people i talked to, you know, in corporate america and including democrats, don't quite know which way they're trying to go. >> it can be a cynical viewpoint. we're so cynical, the public about washington, at this point, alex, aren't we? they don't have 50 votes to bring this immigration bill up again. they need 60. they will go through the motion as an electioneering political

polling now to say we care about immigration. do you ever -- you cover it closely. do you ever get tired of it and say i'll go be a forest rang error sranger or something? >> i'm a terrible camper. not really. i would probably burn down the park. >> are you not smokey bear? >> exactly. i would not describe buymyself cynical. i didn't find it interesting. i should probably get my backpack ready. you are going to see them bring up the immigration bill. it is a lot of kabuki theater. a lot of election time is kabuki theater. you see every single tpoll that

shows donald trump is trusted by more americans on immigration. the white house knows that number and is going to try to maybe not win the issue, but make donald trump win it less. donald trump has told the republicans he doesn't want it less, because donald trump has essentially told the republicans that he didn't want to see -- he wants the issue going into the election year, and he doesn't want there to be any progress and let joe biden get a bipartisan bill. >> yeah, and a lot of people don't like the bill, and instead of closing the border bill it's a way of assimilating people, and the mechanism for letting people in is sort of easier under the new bill, and i think they -- the inflation thing is going to be tough, alex, because you can -- you know, you can

dance -- you can stand on your head or do whatever you want, but if people go and can't buy whatever they were buying a few years ago because the paycheck doesn't get there, it doesn't matter what you say to them, it's the matter of the sit situation. >> you see it, where the president is trying to get credit for inflation coming down, and voters are blaming him for it going up in the first place. >> it's not 17%, it's not minus 3. people don't have to be good at math to know that they don't have as much money. alex, thank you. coming up later in the show, we will talk crypto with gal kwrubgs founder and ceo, michael

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micong up, the latest ai product announcements from microsoft. "squawk box" will be right back.

welcome back, everybody. macy's just reporting earnings of 27 cents a share and that was 12 cents better than the street was expecting. it came on the revenue of 4.5 billion, and that was inline with expectations.

it was better than the down 3.1 the street was expecting. for more on this we want to bring in melissa repco. >> yes, there's a couple different dynamics here. macy's, the name sake is the weakest of the three brands. macy's recently announced they are closing about 150 stores, and that shows the pattern its stores and website is not doing as well. it did raise the full year's earnings guidance, and that's because of the beat and raised guidance just a little bit, and what macy's is trying to point

to, keeping some of the name sakes open, and it's testing that, and the first 50 stores it invested in is doing better. >> just, a lot of stores in b-level malls are not getting the traffic they used to be getting? >> exactly. and the new ceo that used to lead blooming -- >> is this a key where you have to be high-end to survive in the market? >> that is one thing, and bloomingdel's is bringing in

younger shoppers. >> i saw it down 3%, and then -- >> it jumped. >> yeah, it changed and we will continue to watch it. the real question is how they can do that? >> it's worth noting that macy's is not only struggling as a brand but it's trying to get people to buy discretionary items, and bluemercury is up about 4%. >> that was done a while ago, the bluemercury deal when terry was running the shop. >> yeah, and now they are planning on opening new stores and macy's missed out on some of the beauty gains and could have

capitalized on that more had they opened a lot more stores years ago after they did the acquisition. >> melissa, thank you for coming in. melissa repko. it's just after 1:00 p.m. here in paris, and you are watching "squawk box" on cnbc. i am andrew ross sorkin along with joe kernen and becky quick. we are here in paris as ceos around the world descend here for something called viva tech. some news out just this morning, president macron traveling this evening where riots have been taking place, and it's a conversation coming up back home and here, and they shutdown tiktok in caledonia as a way to

prevent the riots from growing, and now an issue here that has come to the fore in europe, and we will talk about that more in a bit. i want to check the futures before we head over to our good friend, dom chu. the s&p up about 500 points. becky, i will send it to you, and then you will send it to dom. >> becky, andrew, joe, we will start things off with the earnings, and the first was macy's and now its lowe's. just a little over 10,000 shares of volume. it reported better than expected profits and revenues, and it

reported a drop in some locations and reaffirmed the full year's forecast. the results come as more diy customers are cutting back on projects, and growth among professional type of customers helped to offset the weakness in dyi. next, palo alto currently down about 8% or so 25,000 shares of volume. the cyber security company reported better than expected at last night's close, and offers a forecast that was largely in line with consensus, but its billings forecast was seen as disappointing as customers cut back, and palo alto down about 8%. and then the broader cryptocurrency ecosystem,

bitcoin is back above the 71,000 mark, up 2%. ether prices are up about 10% as well. a lot of the move is on the back of optimism that u.s. regulators may be what is seen is meaningful progress as ethereum exchange traded funds, and the fcc requested information on the exchange operators as well. the crypto stocks also riding some of the positivity. microstrategy up, and coin base up and robinhood up. andrew, i will send it back to you over in paris. >> thank you, dom. it is beautiful here. microsoft just announced a $4 billion investment in the country, and we will talk this morning about microsoft's new surface devices with advanced ai

capabilities, promising longer battery life and support for the open ai, and we will hear from anthropic in france tomorrow. joining us, senior personal technology columnist. you just wrote about these new devices. i guess we will just ask you the question, thumbs up, thumbs down, what do you think? >> from what i see early out of the gate, thumbs up for sure. this is in the race to catch up with apple on their arm chips. apple kind of blue it open a couple years ago, and created laptops that got rid of the pain points we had with laptops, they are cool and last long and performance is good, and microsoft struggled to do that.

they queues qualcomm chips and promise great battery life and performance, and if they can get the basics right i think microsoft has a hit on its hands. >> the most interesting feature you wrote about on the new devices is the idea that when you forget what you saw, and how often you have been on a web page, and you forget where you found it and now you can ask the computer and it will show you a screenshot of what you saw days and months ago? >> yeah, so it definitely sounds creepy. i asked the ceo of microsoft about this, but here's what is happening. there's now a chip on the device that enhances ai, and there's a model on the device -- this is not going to the cloud, so it's taking screenshots of what you are doing, and i can tell you, that does sound creepy, and takes screenshots of what you

are doing throughout the day and on the device it's using ai to figure out things, and you can go into the search box, and you can say, i saw a guy from cnbc and it looked like he was in paris, and that can search that, and this is only happening on the device, and doesn't have to go to the cloud. i did get to test the feature, and you can turn it off and limit it from seeing certain websites like your bank and et cetera. >> my memory, unfortunately, doesn't feel as good as it should feel all the time. what else did you think was on the list that would make it super competitive with apple? and we are waiting to hear what apple is doing with its ai plans in june. >> yeah, to me, there's two

things. one is getting the basics right. microsoft has not had a competitive computer to what apple has done with the m chips, and even the ipad pros. the second thing is the ai features, right? they are running on the device. yeah, you will still go to chatgpt that is going to the cloud and you will use co-pilot, and the ability for developers to take advantage of the chip on the device that can do local ai processing, and i suspect we will hear more from apple on that as well. >> joanna stern, you know, this is going to be an unforgettable interview, because if you want to go back and find it, folks, you can just say joanna, paris, whatever you want. thank you so very much. see you soon. joe?

>> see you soon. coming up, the dow posting its worst day of may so far, but the nasdaq had a solid session and closed at a record high. we will talk with barry knapp.

little yesterday, and the nasdaq

closed at an all-time high, but joining us now is barry knapp, director at iron sides macro economics. you have a higher risk than just in the s&p itself. >> right. >> so you are bullish. >> the setup is like the 1960s where bond yields made a series of higher highs, and inflation was rising and the fed rate repression is receding -- >> that all changed with the last cpi number, hasn't it? >> well, i think what cpa said was first of all, the volatility of inflation is falling a lot, and i am in the camp we are not

going to 2%, we are going to stay 3, 3.5, and that has fallen back to the 1960s and 1990s levels, and at that level parts of the market can operate really well, if you are an energy company and industrial company, you cover your fixed costs and it has positive operating levels. for those industries they thrive in a higher inflation environment, and that was in the '60s, but in other industries, like the banking industry, for example, they struggle in that environment. yeah, those sectors are definitely aggressive if you are all in on tech, industrials, energy, materials, by definition you have very aggressive positioning. for me holding cash in the

eventuality that one of two scenarios take place, and one is we have a broader risk off, or we get a growth slowdown, which i think is highly probable given the amount of government spending we have right now, with a 7% deficit -- >> stagnation is not -- >> yeah, i wrote a report three weeks ago that said essentially, there's no stag but lots of flation. >> you allow for the possibility of the weakness in the labor market, but you don't think that's what is going to happen, if there's a 10% pull back, but it will be -- >> yes. >> it's not good what you are saying, 3 to 3.5. if it stays there, we will not

get rate cuts? >> the only way we will get a rate cut is something broke in the financial system. >> how many years to 3, 3.5 -- >> just take that out. >> yeah, you don't need that. >> how many years? >> the only way we get inflation back to two is if we had a significant cut in spending policy, and that -- >> we don't have a candidate running that would do that. >> seems highly unlikely, because you can't get there solely through discretion spending. yeah, we have spending to wrap up on, obamacare, health care expansions, and the infrastructure spending, the

rerenewables bill. all those things are keeping government spending running at levels -- i said this before, when i studied economy, government spending was at 24% of gdp and the deficit -- >> i think if you are right, cash is the worst place to be,ing and with inflation cash gets less and less every six months going by. if you are right, the market will take off, and so why sit in cash? >> as a bit of an opportunity cost or to provide the opportunity to be able to put money to work if we have one of those -- >> you don't think it's going to be more than a 10% pullback? >> the thing that causes deeper pullbacks, 20%, that type of

move is a recession, and like the first half of '23, or a full on ndr recession -- >> you see, that's the problem, i always bring that up, i want to call you barry k -- >> "squawk box" asia calls me k-nap. >> they do? >> yeah. >> thanks for coming. coming to you now from paris, and when we come back, whole foods market ceo, john

mackey joins us to talk about inflation and more.

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welcome back, everybody. our next guest has pretty unique insights on the state of the grocery market, inflation, the consumer, business and much more. joining us to talk about it is whole foods cofounder and ceo, john mackey. he served as the chief executive for over 44 years and his new book is out today, appropriately entitled "the whole story." john, welcome. >> great to be here. >> it's a pleasure to have you here. i think a lot of people know who you are, and probably know a lot of about what you have done but for anybody who doesn't and has been living under a rock for this time, you mainstreamed the idea of natural foods and brought it to the masses, the idea that we can eat clean and healthy. you pioneered the whole market there. what do you see now in the grocery industry?

>> it's continuing to evolve. i mean, it was so interesting, we had the covid years and people were scared to come in to grocery stores, and delivery really exploded. that's one thing amazon did for whole foods was helped us ramp up quickly for the delivery business, and now people settled down and delivery, it's still there but more for people that have more time than money and are willing to pay to have the products delivered, so the stores are bustling again. >> processed foods to whole foods, that was a change for thinking when i was a kid. >> yeah, when you have an idea that goes against conventional thinking you are climbing a giant wall of skepticism, everybody telling you it's not going to work, it's not going to work, until it does work.

and then it flips and you say, duh, that's really obvious. >> to see you going up against the shoprite, and kroger -- >> yeah, nobody paid attention to whole foods until we came to new york city. we were discovered and everybody started to pay attention to us. >> i think there's a down side to stigmatizing gmos. i think it's a downside. there are people that will not take any drugs, and they are all genetically modified. why stigmatize that? did you do people a disservice with that? >> i never was anti-gmo, but it's what kind -- >> yeah, i like my milk

pasturized -- >> i understand your point. you have not said anything i disagree with, but it's a matter of which pesticides and gmos -- >> which gmos are bad? >> well, the question of what we are doing with corn, and i think the science is starting to show it could have negative affects. >> do you think it set back that whole industry though? >> they created gmos that can solve blindness for children in india because it's called golden wheat, and so they -- they genetically modified the wheat so it has beta carotene in it, something children don't get if they are eating a white rice diet, and i agree they should not be blanket condemned but there are some that should be, and they need to be well

regulated. >> i think it probably did more harm than good to stigmatize it? >> it might have, but i was not one of the stigmatizers. >> it gets tkpwgrouped in with natural. and preservatives, how many do we have and do we need? >> well, i am not a scientists, but a lot are not healthy, and lots of lobbying goes into keeping those preservatives in, and it means that we thought better off eating whole and natural foods as much as possible. that's been our philosophy. not everybody agrees with us, but, i mean, whole foods is doing over 20 billion in sales, so a lot of people agree. >> you have a newfound up, love,

live, dedicated to holistic health. you have a flagship store opening up. >> it is a continuation of my own higher purpose. it's a membership club, and it's big, and it happens to be located in the same center as whole foods market, and we are going to have a spa, and state of the art health center, and a medical center. when do most people go and see a doctor? >> when they are sick. >> yeah, and we want to change that paradigm, find out your baseline health and then create precision plans for people to optimize their health. once you can get the baseline

established, you can create plan for you to become the healthiest version of yourself. >> it sounds like a cleveland or mayo clinic. >> yeah, this is going to be in urban settings. >> and if i call my doctor and if you are not sick, they say make an appointment and it's three months away. >> well, here you can get one the same day. people asked why i didn't do one in usaustin -- and you might as well find out quickly if the idea has legs or not. >> when does it open? >> july 9th. >> do you go to whole foods? >> yeah, and i have to admit i go to a second grocery store,

and -- >> i am not going to admit i shop at anywhere but whole foods. >> but i bet you do. >> everybody would freak out. >> yeah, the turkey is totally seasoned and amazing. i'm in whole foods every year. yeah. >> great produce. >> yeah, and i moved on to a new phase in my life. turns out, i can have friendships after all. >> john, we appreciate your coming in today and we will be watching this. let us know how this takes off and what it looks like. >> i hope it takes off so you will have me back on the show sometime. >> thank you. >> thank you so much. andrew, back over to you in paris. >> thanks, becky. when we come back, we will have a live look from paris where it's just 66 days away from the

opening ceremonies. and then mike novogratz joins us for the latest. "squawk box" returns after this.

people couldn't see my potential. so i had to show them. i've run this place for 20 years, but i still need to prove that i'm more than what you see on paper. today i'm the ceo of my own company. it's the way my mind works. i have a very mechanical brain. why are we not rethinking this? i am more... i'm more than who i am on paper.

good morning, and welcome back to "squawk box." we are live this morning from paris. the olympics opening ceremony just 66 away -- 66 days away now, starts on july 26th. it will take place on the river, and 300,000 spectators expected to watch in person, and the first olympics opening ceremony being held outside, and it will run along the most famous avenue behind me, and it will pass through where we are now. this week in paris, there's a conference bringing together thousand of startups and technology executives from around the world. top of mind, as you might imagine, artificial intelligence onstage tomorrow, and i will

speak with anthropic's ceo. and ceo robin lee coming in from beijing. finally, the man of the hour, the chairman and ceo of lbmh, bernard will be here. i should mention 15 million tourists expected to be here in paris with all of us. becky and joe, i know you will be with us and me and all as well, and it's a beautiful day and hopefully this is what it will look like when we are there come july. >> 15 million? >> i was thinking with the street behind you, what it's going to look like behind you with 15 million people on the streets?

>> it's going to be a lot. >> yeah, and it's just how spread out this whole olympics is going to be. it's not contained in the way so many other olympics have been in the past, so i don't think it will necessarily feel like everybody is on top of each other at all, but, of course, we will see. >> very good. i'm glad you're over there casing the joint for us, andrew. that's good. you know, in the old days, you would send out, like, a scout to see where everything is. >> i think the survey is looking pretty good though. >> yeah, it is. >> i found that we have great chocolate croissants, and we found a great crepery.

we're on it. >> that's what we want to hear, andrew. coming up, looking at a change in the way some conservatives view economics and policy, and ayman jeffers joins us next with that. as we head to break, here's a check on the markets, which are slightly in the green. "squawk box" will be right back. this is real time insights. i am here with lisa caldwell. we're talking about supply chains. they have been in the headlines a lot in the past few years, and what is next? >> supply chains are at a

critica critical juncture. driving integration all the way from sales and marketing through product development to traditional supply chain functions. >> what is spurring these changes? >> organizations have used historical data to drive out costs but with particularly ai we can move beyond historical views and start to incorporate product and consumer insights into our analysis. it's that jolt of caffein that really makes operations strategic to the enterprise. >> how are you seeing this play out? >> there's a number of examples and one that comes to mind is a large retailer that wants to use ai to manage orders at a store and customer level. that may sound easy but it required us to evolve their disd disdistribution network. >> lisa, thank you so much for sharing your insights. >> thanks for having me.

♪ ♪ the apraoefp conservatives take on the economy is shifting and it's more important than ever ahead of the november election. >> the first trump presidency shattered conservative economic ideology on the approach to tariffs, but the second approach

if it comes could shatter it on everything else in the economic fashion, and conservative economic thinkers spent years with the polick ound donald trump's populist message, and what they came up with, worker first package of ideas that is increasingly important in the party. folks at american campus have been churning out proposals designed to reset the republican thinking on the economy. it's not clear how much clout they would have with a second trump administration, but one of the most influential voices in the trump camp sits on the board of directors of american campus. it embraces unions and high tariffs and strict immigration limits and a transaction tax on

wall street all designed to stop what the new economic populist see as the financization of the economy. critics think it will result in higher taxes and inflation and less efficiency in the market. one critic dismissed it to me as big government conservatism. if trump wins in 2024, expect the economic policy to look more like a populist model than the low tax and reaganite approach in politics. back over to you. >> thank you. we want to bring in american campus executive director. you just heard the report, and i don't know if you want to add or chime in, but how different will

this be if trump becomes president? >> i think it's hard to say what trump will do, but if you look at the folks advising him, and if you look in congress and who he has on the other end of pennsylvania avenue, and in 2016, it was paul ryan with a big tax cut and repealing obamacare, and now senator rubio and senator cotton and these guys are all doing really important work advancing exactly this agenda and really building out this framework. i think as he said, it's a very different party and conservative movement. you are going to see a different policy approach. >> right. >> orrin, here's the big question, if you are the president, whether you are president biden or former president trump, and you wanted to juice the economy, is there a

way to juice the economy without creating more inflation? >> well, i guess i am not sure what you mean by the term juice the economy? that sounds like the mind-set that produced the last few decades of surging stock market valuations without accompanying wage growth or prosperity across the country. that's, i think, the exact problem. what we need is a stronger and more productive economy that sees more domestic investment and that sees a real focus on boosting the productivity of american workers where their wages can rise so they can support their families. that's the sort of agenda we are focused on. that doesn't just mean tax cuts, deregulation, free trade with china. that means actually returning, among other things, to the american tradition of economics that focuses much more on how you build a strong economy here at home. >> what i heard him say, donald

trump is not going to say i want to raise corporate taxes. in what universe would that make sense as a conservative to raise taxes on corporations? >> well, first of all, as a factual matter, jason smith, chairman of the weighs and means committee said last week there are a lot of folks that thinks the corporate tax rate needs to be higher, certainly than the 21% it came down to. philosophically your question gets to the right point, which you said what is conservative? reagan, let's not forget, cut taxes and then raised them at least five times. this idea that republicans or conservatives are only for tax cuts and taxes must always be lower, and there's nothing conservative about that, and that's quite sort of an absolute radical nonsensical notion.

i understand why the business lobbyist push that. >> you are making too much out of it. the basic tenant of reaganomics will always be part of what true conservatives feel. leaving money in the private -- yeah, i -- leaving money in the private sector is where it's treated best and it spawns innovation and entrepreneurialship, and i think you are making a mountain out of a mole hill here. the guys you mentioned, none of those guys are tax hikers or want to raise corporate taxes? >> well, senator rubio along with senator lee in 2017 forced the tax rate up because they wanted more funding for the child tax credit, and even then the idea that the corporate tax rate should be as low as possible is not what somebody

like senator rubio was pushing. senator hawley, vance -- if you listen to your effort there to spout the reagan dogma, it doesn't make sense, it's like whatever leaves money in peoples o'w peopleso'wallet -- >> this is going nowhere. 1776, you can figure it out. they understood this with adam smith and all the way up to the current time. this is not going to be the new plank of the conservative party, higher minimum wages and more regulation and higher taxes. it's not. then you might as well --there would not be two parties. join the other party if you want to do it. >> there was not a republican party in 1776, joe.

>> that's not the point. the point is that we have known that free markets and pure capitalism probably presents the best way to prosperity, and that's not going to change no matter how many times -- >> i agree. >> joe, let me ask this, orrin, how do you square what i believe is former president trump's campaign pledge, which is higher tariffs on places like china, so there might be a deregulation on one side, but there are other measures on the other side? >> it's not clear, frankly, at this point what agenda trump is running on, and tariff s is an important piece of that, and tariffs are a way to collect tax

revenue. that was something certainly the founders were very interesting in. i think the important thing to focus on is more whholistically and joe did a good job of articulating this idea if you have lower taxes and if you wave your hand and market something, something, and if you go back to adam smith and the wealth of nations and the very paragraph where he talks about the invisible hand and you see the invisible hand is not a magic force, and he says if people prefer to invest internationally, and if they pursue ways that will produce the most output and employment, then their pursuit of profit will help the public interest, and it's those ifs that joe forgot about, and if they are going to spread prosperity to

the typical family, you need constraints in place, you need to make sure the things that produce the most profit is also good for people, and sending all of our investment capital to silicon valley to build apps is not good for people, and wall street generating hundreds of dollars in fees for private and equity hedge funds, that's not good for people. it's anything but conservative that you have to pledge blindly to the free market. >> i have a question. i wanted to see if i could ask one more question about the other big departure point which is a worker first approach that you and your colleagues take and your approach to unions, which, i think, is very different than

where we have seen republicans in the past. donald trump has gotten enormous support from union voters but not from union leaders. you have a whole new way of thinking for conservatives over politically, a lot of them support donald trump, and yet you have these union leaders thinking, just, we have to fund democrats, we have to fund democrats. and that's not a good or sustainable system. but if you step back and think about the idea of organized labor, the idea of workers actually having power. that's a good thing. and that's something fundamentally conservatives should want to see. it's when workers have power that they actually do see their wages rise. it's when workers have power that they can protect themselves in the workplace so you don't need so much regulation. it's when workers have power that they build organizations that are really cornerstones of civil society. and so, the work that we and a lot of others on the right are

doing now is to focus conservatives back on the idea, you don't have to like big labor the way that it works today, but you should want workers to have power. you should get away from this idea that just, as i was doing a debate with steve moore from the heritage foundation, and he actually said at one point, he said, you know, rising stock prices and cheap labor, that benefits everybody. and i said, well, i'm not sure it benefits the labor. and so that idea that as long as the stock market is up and businesses can get the cheapest possible labor, we'll all do well, it's just not true. because people are workers, too. and people need to thrive as workers, if they're going to support their families. >> warren, want to thank you. eamon want to thank you. potential shift in the conservative view of the world. we'll see how it plays out. meantime, "squk x"omg ghba after this.

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coming up in just a moment, macy's out with results earlier this hour. we're going to break down the numbers and talk the health of the consumer. quk x"s hat, straight ahead, a "sawbo rolls on from paris and the nasdaq this morning. your record label is taking off.

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macy's out with first quarter results in the last hour. joining us now to break down the report and the consumer landscape, bob determinel, equity research analyst at guggenheim. macy's is in a -- i don't know what you would call it, a retrenchment or something, bob. at this point, are you seeing signs of progress in the latest quarter? >> good morning, joe. yeah, i think macy's is off to a really good start with the new leadership that's taken over and you know, this quarter was definitely encouraging start for what they're trying achieve. >> the stock is sort of unsure which way to go. where are they in the -- in their efforts, in terms of closing stores that are underperforming and getting back to a -- that was a much higher stock, obviously, not too long ago. what do they need to do? and is there a -- do you see a

path back? >> well, i think overall, what they're really trying to do is take some new steps and you know, there's an aggressive store closure plant, which i think is a really intelligent, you know, first move for them. their plan is to close 150 underperforming macy's and try to reprioritize the remaining 350. they're trying grow luxury store locations by 20%. there's an asset monetization program in place. you know, and i think it's just a really tough business. and it's really competitive and it's a tough landscape and the consumer positioning is also not really helping them right now, as well. >> is there a -- do you see, bob, a transition to a different business model than malls? how many malls are really like we think about from 30, 40 years ago? if you're not an "a" mall, it is

10% left or where is it? that's why i don't know where macy's fits into the whole picture of the future of retail. >> one of the things i would say from this morning, joe, there are a lot less malls and a lot less high-quality malls. but from the macy's strategy, what you're seeing right now is, their top 50 locations are actually performing quite well. i think they were up this quarter, 3 to 3.5%. and i think what they're really trying to do is narrow down the winning locations, you know, find the right strategy within the consumer, and thnavigate a t of these headwinds that are out there in the retail landscape, competitive pressures, consumer pressures, real estate pressures, interest rates, inflation, everything. you know, it's not an easy road. you know, but i think there are early days and they're taking some of the right steps. i think that store closure program was a lot more than we anticipated. and i feel like that's a great

start to the strategy, and as they narrow down their location base, they can focus a lot more from the strategy and be more competitive. >> okay, appreciate it, bob. thanks. bob durble from guggenheim. it is 8:00 a.m. on the skpx you are watching "squawk box" right here on cnbc. i'm becky quick along with joe kernan and andrew ross sorkin who's in paris this orning among today's top stories, cryptocurrency prices jumping. bitcoin's higher, but it's etheorem that's really gaining ground. that snakes to optimism over the possible approval of a spot etf. we'll talk much more about this in just a few minutes with galaxy's micronovogratz. private secretary janet yellen say that the u.s. and europe need to respond to china's industrial policies in a unified way to keep manufacturers healthy. yellen was speaking in germany. she said china's excess industrial capacity threatens both american and european firms and poses risks to emerging

market countries, as well. and speaking of china, some american fears have been tied to the idea that china might somehow acquire the most sophisticated semiconductor manufacturing equipment, like the machines that are made by the company asml. this morning, bloomberg reports that the company has a secret way to disable its machines, if, for example, china invaded taiwan, where taiwan semiconductor is a major client. the report says that the u.s. government officials express concerns to their dutch and taiwanese counterparts. it also says that asml reassured dutch officials about that kill switch. joe? >> futures right now, we are seeing a little bit of a gain. the nasdaq was a new high yesterday. big record close. the dow was down about 200 points. you can see that, we're seeing a little bit of a move in the nasdaq, but the dow is up. the treasuries this morning, about 40 or so, 442.

let's get to dom chu with a look at this morning's pre-market movers. >> let's quick things off with a look at a few analyst calls moving things around pre-market. you just smpoke about earnings and retail. gap stores were up about 1.5% off the pre-market highs, over 30,000 shares of volumes, due in part to the team over at citigroup, which is opening up a positive catalyst watch on the p apparel and retailer, also old navy, and@letta stores. they think that gap will announce a big earnings beat when it announces on may 30th. a week later, not this week, but next, driven by things like better comp store sales growth at old navy, also, better overall profit margins. that store is buy rated. those shares are on the move. a couple of casino gaming stocks also moving higher. thanks to analysts at raymond james. and among them, cesar's gets a strong buy and a $55 price target.

it's their top pick in the industry, given lower trajectories. they think that the sell-off there this year is overdone, and that all the negative of the news has already priced into those shares. cesar's up 1.5%. same with penn entertainment. for more on those calls, other top analyst calls of the day, head over to cnbc.com/pro, subscribers can get more detail and analysis over there. zoom video, those shares are down roughly 2.5 to 3%. video conferences, reporting better than expected profits and revenues after last night's close, but the current quarter forecast is being seen as somewhat disappointing compared to some analyst expectations, leading to some concerns for investors that zoom is facing some of the same issues. other enterprise tech companies are, that bigger corporate clients are not spending as much given the uncertainty. so zoom video down 2%. i'll send things back over to you folks. >> thank you, dom. the nasdaq closing at yet

another record with an assist from ai giant nvidia. that company set to report quarterly results tomorrow after the bell. joining us right now to talk about the market impact of the magnificent seven stocks and more, is sylvia jiblanski with defiance etf. sylvia, i think you made the point that jenson wang is the voice of this market right now. >> good morning, becky. yes, he is. if we look pack over the last couple of years, it was elon musk and tesla, and then, you know, tim cook and apple. whatever happened with those stocks is where the market was going. and this is nvidia's year. all eyes are on earnings now. we want to continue to hear about growth. we want to continue to hear about the skbpositive outlook f chips, ai, innovation. how this is taking off and starting to proliferate other industries now outside of just tech. all eyes will be on this earnings call. if it's good, if you get another rally in the nasdaq. >> sylvia, this momentum has been pretty tough to stop.

we did see a 5% pullback, maybe 5.5% pullback last month in april. but those concerns faded really quickly. money came in off the sidelines really quickly. and i just wonder what you think happens next. i'm distracted by people behind you, andrew. >> right? >> it's always a little trepidatious when you get this big run-up. you know at some point, you'll get a little bit of a pullback, but the question is sort of why? is the market overheated, lots of activity, a good run-up taking some gains, the stock's okay and we can keep going, as long as it's not geopolitics or a reversal in the fed. but i think the outlook is pretty good here. we have some good macro factos inflation again looks like it's going in the right direction. the fed is pretty neutral, and corporate earnings were arguably great, you know, buybacks are up, companies are doing well. forecast for the next two or three years are between 12 to

14% growth. and so, if you're sitting in cash at 5%, all of a sudden, 12% sounds pretty good, and you might be willing to take a little more risk back into the market. i'm sorry, go ahead. >> yeah, i was going to say, i think it's a good time for equities again. >> you're telling people to buy into dips. what if there aren't dips. would you suggest still dollar cost averaging? still putting money to work? >> yes, absolutely. i think that -- i think that when you're in this situation and there's so much, you know, positive innovation, particularly in technology and potential growth around this thing that is ai, you know, it's going to impact health care, aerospace, and defense, infrastructure, technology, i do think dollar cost averaging is always smart and staying in invested is always smart. you want your money to work for you. it's not going to work for you if equities are rallying in the double digits and cash is kind of stale. >> sylvia, thank you very much. >> thank you. have a great day. >> you too.

we want to get back to andrew who is in paris this morning. andrew, i literally lost my train of thought, because i was watching the pictures of people behind you. there was somebody who was just working out right behind you, stretching out right behind you before. you're on an active, busy street, right by this beautiful monument that we all know so we well. >> yes, we are becky. we're here in the champs-elysees. we're getting ready for the olympic opening ceremonies, 66 days from now on july 26th. of course, nbc, nbc universal, nbc sports, nbc news, we're all going to be here. it will take place on the sienne river. 350,000 spectators will be able to watch in person for the first time ever, the olympic opening ceremony produced outside of a stadium. i'm here this week in paris attending ing advviva tech, a

conference that brings together start-ups and technology conferences from around the globe. top of mind, artificial intelligence. on stage tomorrow, i'll be speak with anthropic ceo, dario amodei, and we'll speak to a whole number of other leaders as well. and lots of other news coming out of france this morning. the president, president macron going to new caledonia a little bit later tonight, where riots have been taking place. it's the third largest producer of nickel. it's super important in terms of some of the geopolitical issues that are taking place around the country, but. also this report they imagine both you, joe, and becky, are going to be interested in. semafor now reporting that klaus schwab is stepping back from running the world economic forum. he'll take on the role of chairman pending the approval by the swiss government. he announced his intentions in an email to the staff. according to that report, schwab, has managed the world

economic forum for more than 50 years and it has become an event like no other every january in davos, switzerland. now the speculation is going to swirl about who is going to take over the world economic forum. borg benday is the president of world economic forum. he's been complemented many times by klaus schwab. we'll see whether his name is in the running or whether others emerge. but big news in the world of europe and economics and business leaders. all of whom have been coming to switzerland for so many years after getting the invitation from klaus schwab. >> that was the first thing i thought, andrew. schwab said that basically, that president rente has taken full executive responsibility. he had already done that and it goes on to say, burundi is a former norwegian conservative leader. now, i don't know what the hell that means, norwegian

conservative, but it's got to be a step in the right direction. it could be a step in the right direction. i was hopeful! i was hopeful. klaus is 86. i didn't realize that. >> why does he have to ask permission from the swiss government first? what do they have to do with any of it? >> they should be neutral. >> my understanding is the world economic forum is a not for profit -- >> really?! >> klaus did all right for himself for not for profit. >> an institution that brings in several hundred million dollars in revenue every year. there have been questions about the fact that it is considered a not-for-profit for a very long time, but we're going to see where this all goes. but i know that -- for years, there's been speculation about who would take over, for many years, there was a view that there were a number of leaders of european countries, frankly,

that might want to take the job. we'll see and maybe we'll talk to some here while we're here this week and bring you some of that news as well. >> thank you, andrew! >> all right, yeah, we saw that. where there's life, there's open. coming up, we'll speak with mike novogratz about bitcoin and ether, as the former closes in on an all-time high and the latter sees a big spike on some etf optimism. and later this hour, former u.s. chief technology officer, aneesh chopra joins us on the latest trust and safety questions surrounding ai. stay tuned, you're watching "squawk box" on cnbc. (office chatter) is it me...or is work not working? at least, not the way it could work.

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president biden announcing

tariff hikes on nearly $20 billion worth of chinese goods. those include increased taxes on electric vehicles, batteries, computer chips, and medical products. but our next guest says the u.s. is still losing ground while china forges ahead. joining us now, republican congressman, adrian smith of nebraska. he chairs the ways and means trade committee. great to have you on. >> good morning. great to be here. >> wow, there's nothing bipartisan in washington, except tariffs. >> tariffs. >> what happened? >> well -- >> where the hell are we? >> i think we need to ask ourself the question, what is the trade agenda right now? we've seen virtually nothing out of the biden administration. and so, you know, president trump, he introduced some tariffs, but had a much larger, broader trade agenda that helped us move the ball down the field and level the playing field. but clearly, the regulations that president biden is responding to is the underlying problem, as well. >> tariffs typically are not a

basic tenant of conservatism, which i'm not really sure i know what it is anymore. i think there's a unit party. it's like, conserve-p conserve-progressivism. have you heard this? are you familiar? >> i'm not familiar. >> did you hear any of that? >> i did. i did. >> is that where the republican party and conservatives are in any way, shape, or form, is that going to be part of the plank? >> i would disagree with a lot of what he said. i believe that, you know, especially with his supply chain crisis and inflation, we need to be looking for ways to reduce the costs, not add to the costs. >> who knew bernie sanders was the biggest conservative we had in washington. this is what i need to know, though, congressman. suddenly, if the situation calls for tariffs are the only way to do things, it always seems like in the past, we could out-innovate, out-compete. you know, there's dumping,

there's things that we don't like. but tariffs were never really a panacea. and now they seem to be from both parties. >> well, i've long said that i'm not a fan of tariffs. they are a tool noin the toolbo. >> do we need them right now with china? does the situation call for strict, tough -- >> well, in a silo, if they're siloed, i think they're problematic. what we do need is a broader trade agenda so that we can address our supply chain challenges. we want to increase productivity here at home, and our tax reform of 2017 was very effective, especially heading into covid. and so we need to make sure that those policies extend into the future. that's what we are working on right now. 2025 is a huge, huge year for for tax policy, as the expiration occurs on so many provisions. we need to get things done here and really focus on how can we introduce more productivity, not

less. >> well, you'll need trump to win the election to keep going, right? >> absolutely. absolutely. >> congressman, i think where it gets a little conflated with trade now is the idea that we n supply chain issues, so we look at things different than we did pro-covid. we need more of a diverse manufacturing base, more things made at home, and that gets tougher to navigate when you start mixing all of those issues. >> we just passed out of the committee tariff relief that ultimately gives our producers, our manufacturers domestically, some release as they acquire the supply chains that they need, the supplies and components that they need. we shouldn't have policies on the books that make it more expensive for our domestic manufacturers to do business. >> i don't think that you would see president trump taking entirely different approach, though, when it comes to the

idea of some of the things that are getting flooded here. when it come to electric vehicles, he was a big supporter of the unions during the big three strikes, too, and probably is very concerned about american manufacturing in these cases. >> right, you take electric vehicles, and in many cases, in many ways, they're just not ready for prime-time in the marketplace. tesla, yes, they're a good product, but still pretty pricey. >> do you have a less -- chips act, did you vote for the chips act? >> i voted against it. >> you voted against it. how do we onshore stuff that we need without -- you didn't think that was the way to do it. it sort of trends towards government-run private sector, right? i mean, picking winners and losers. nobody really wants that from your side of the aisle, i don't think. but how do you onshore, near-shore things that are important for security. >> tax policy is huge.

and even president obama called for a more modest corporate tax rate. and then, you know -- >> don't get me started -- you're putting me back into that -- where i was -- >> being in the trenches for a 2017 tax reform, you know, we heard from the trump administration in terms of the importance of a low corporate tax rate to changethe pattern of these inversions that were taking place on such a regular basis. we produce results with 2017 tax reform, and reducing and basically eliminating the inversion is the evidence. >> okay, what else? what would be your more tenants for our trade policy? >> well, critical minerals. i think when you look at all of our natural resources, domestically, we need good policies to encourage and allow access to the natural resources that we know we have. whether it's critical minerals, whether it's other natural resources, we can do a lot better on that front than we

currently have. >> very good. i don't know what happens in the house and senate in your view? >> i think we get the senate, lose the house. >> some republicans think you lose the house and maybe flip the senate. >> when you look at some great candidates we have across america, coast-to-coast, i'm encouraged. and this is a dynamic that is absolutely vital that you have the candidates that you need to get us across the finish line in november. i think the american people appreciate what the agenda needs to be for america to grow, whether it's trade policy and increasing our exports, and developing our supply chains, whether it is looking at overall domestic regulations, we can do a lot better. >> have you heard mr. smith goes to washington? i guess you've heard that

before. >> i've seen the movie, yes. >> you have, okay. have people said that to you? >> just a few times. >> everything i come up with, i feel really good about it, and then i realize it's probably not that original, is it? thank you, congressman. >> thank you. >> thank you. well, johnson skband johnso announcing positive data from trempya. it demonstrated superiority versus placebo and stelara. it faces biosimilar competition in europe this year and in the united states next year. you can see shares of j&j, up by about 37 cents. andrew? >> thanks, becky. coming up in just a moment, when we return here on "squawk box," all about the latest crypto price bump. we'll talk to galaxy's mike novogratz. does he see an etf approval on

the horizon, that seems to be the speculation, why it's been moving. we'll get into that and so much more, but first, as we head to a break, check out shares of alibaba this morning, falling on reports that the company slashed rates to use its ai services. stay tuned. you're watching "squawk box" from paris and the nasdaq this morning, right here on cnbc. dad, don't forget about my new cleats. sweetie, i can't make it to dick's this week. have you heard of dicks.com? have i heard of dicks.com? girl: let's go! let's go! have i heard of dicks.com? (screaming) whoa. don't overthink it. let's go shopping. actually what i need are some cleats. how about one of these? great. done. anything else? no. golf clubs? not for me, for a friend... yeah, yeah, of course... anyone impressed with how fast that was? yeah, totally! i know, i went to dicks... my cleats! thank you! i love you! wha... i-i went to dicks.com. ever heard of it? girl 2: yeah, i told you about that. ( ♪♪ )

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welcome back to squawk podcast. bitcoin approaching its previous highs, $73,000 and change, but the big crypto story today appears to be ether over the possible approval of a spot etf. let's find out if that's the case. joining us now, michael novo novogratz, galaxy founder and ceo. the question of the morning, mike. is that the answer?

mike, we're going to try you again i think we're struggling to get your audio. i was worried that my audio -- >> that was mine -- >> here you are! >> you hit mute! >> it's only been a couple of years since the pandemic. no worries. just joking. go ahead. >> listen, eth is a lot higher in the last 24 hours on speculation that the etf is coming. step back a little bit, what seems to have happened is, you know, donald trump, two weeks ago got on stage and said, i am the crypto president. and it was on the same day that joe biden had threatened to veto a relatively obscure piece of legislation that the s.e.c. had put through, a rule saying that crypto assets needed to be held on balance sheet. and that kind of set up a firestorm, where it almost

became a purity test. like, republican, good for crypto, democrat, bad for crypto. and i think the democratic regime woke up saying, this is crazy. there are more crypto owners in america than there are dog owners. we have 85 million people that owe crypto, and a lot are single-issue voters. the democrats looked like they were the party against dogs. so you've seen a pretty dramatic change. first of all, you know, you had nine senators across the aisle and 21 congressman, so that's passed, the repeal of that. it will go to biden's desk. we'll see if he vetoes it or not. and all of a sudden, out of nowhere, what seems to be a complete about-face with the s.e.c. with the etf. and you know, like, listen, i don't have any inside info, other than, talking to people in the markets and we'll see. we do have an etf in registrations. i've got to be a little bit careful. but assuming, you know, the market is right and the market is usually pretty smart, it

feels like someone at the biden white house made a call and said, guys, we can't be the party against crypto anymore. and i think that's a seismic shift. those things actually happen, prices are going to be much higher than here. >> so, you're speculating that a phone call was made from the white house to gary gensler's office, and gary gensler, who for the most part, as you know, has been relatively opposed to these instruments, in fact, he was oppose to the bitcoin etf, until a court told him otherwise. you think he's going to do it, quote/unquote, voluntarily, or pseudo voluntarily? >> i am sensing a widespread shift amongst democrats that don't want to let crypto be a big election issue, right? the crypto super pacs have raised over $150 million, and they have targeted sherrod brown and jon tester, elections that matter dearly to democrats in swing states, in vulnerable senate seats. crypto should be bipartisan.

and quite frankly, for our industry to do well, it needs to be bipartisan. and it has been really elizabeth warren and a small group of people that has held the democrats hostage on this. what the senate broadly said, chuck schumer being the senate leader who voted to overturn against elizabeth was, enough, enough. like, this is becoming dumb. and so i'm sensing a real shift. >> you talk about -- you talk about the industry doing this, as they're separate from you. you've been a big supporter over the years of president biden. i don't know if you still are, but how much are you part of this effort? >> listen, you know, i've had a real view that this needs to be bipartisan, so i have been meeting with democrats and republican equally, trying to both educate -- on the democratic side, i've been right tuk sense, like, guys, this could be the biggest goal of the last six years. there's no reason to make crypto, which is a technology, a political issue. and i think, hopefully, that

message is starting to resonate. >> all right. mike, on another topic, i wanted you to weigh in, you saw that the head of gray scale, which really led the case to bring bitcoin to become a public etf, they are switching out the top person. do you have a view about that and what happened there? i think there were a lot of folks on wall street that have been trying understand it. >> listen, the whole digital currency group, right, the entire group with genesis and gray scale, and all of his businesses made a lot of mistakes. genesis in bankruptcy, being, you know, under indictment, both in new york, and i think with the feds. and so, i'm guessing cleaning house and putting new people in charge to clean up the one asset that they have that has a lot of value, is probably what the genesis of that was. you know, do they put it up for

sale to pay off some of the other problems? who knows? my guess is probably yes, right? it's a shame, right, that had been one of the stalwart businesses of the crypto space. and you know, like a lot of others in 2021, made a lot of dumb decisions, and have left themselves in a compromised position. >> well, mike, it seems to me that the great irony of all of this is that gray skcale was th one that led the charge to become public, if you will, and to get the approval, and to take it to a court, effectively. but the winner of all of this is not them. in fact, it's black rock, probably you, and others. >> well, listen, 100%, we would not have had the bitcoin etf without that lawsuit. at least, that's my view. and so, we all are in debt to that effort, you know, barry silver and his whole team, get a nod there. listen, you know, they made their own bet, and i feel bad

for them, but i don't feel that bad for them, because they made their own bed, and they made a bunch of mistakes. you know, almost more importantly was larry fink getting engaged, because he represents institutional -- like, people didn't ask me about, we're finally going to get legislation. i was like, the government already said crypto is an institutional asset. and lots of the biggest players have said it. and so, now it's catch-up for these guys to give us regulation and to put the rails around the whole crypto ecosystem to allow it to thrive. but i am far more confident today than i was six weeks ago, even, that in some short period of time, we're going to have crypto legislation and a much bigger participation -- listen, that's a two-edged sword. for me, it means, head hunters are going to be calling my guys from the goldman sachs and the citibanks. but you watch, 24 months from

now, you will have a much bigger participation in our space. >> okay, so if that is the case, let's talk about what you see as the upside/downside now, right now, for example, on bitcoin. and we'll use that as the proxy for the rest of the space, if you think that makes sense. we've obviously seen a lot of sc sc volatility. there was a point it had come down lower than you had anticipated, i don't know if that's the case, and whether you think now that there's been some consolidation at the $71,000 level, do you think that holds, do you think we're on a new roller-coaster ride upwards? how does this shake out in the next 12 months? >> i have said just a week ago, on some station, that i thought we were 5575, until either the fed starts cutting rates, which i don't see in the short-term, or we get regulatory clarity. and this regulatory advancement probably is enough to take us to the old highs. we'll see. fit gets a little bit better, we'll take out 73 and who knows where we go.

85, 90, 100. but this is a big deal. listen, if it all pans out the way the tea leaves look like they're falling, we could have just this much of a win, and then settle back in, but these are always narrative stories that need fuel for momentum. and this is a big part of it. and so if the regulatory advancement keeps happening, you'll see it climb much higher. >> fair enough. mike novogratz, always good to talk to you about these issues, especially when they're in the headlines where they are this morning. thank you, again. >> thank you. >> becky, back to you. >> thanks, andrew. when we come back, energy in focus as oil prices slide. rbc's helenacr croft will join next. and a reminder as we head to a break, you can always watch or listen to us live ing usthe cnbc app. stay tuned, "squawk box" will be right back. e music)♪ medical discovery is like finding the right stone.

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welcome back to "squawk box." this is cnbc and we're watching the futures on this tuesday morning. right now, things are really pretty flat. dow futures up by about 10 points. s&p futures up fractionally. and you've got the nasdaq down

by about 27 points. this does come after the dow closed down yesterday. it was its worst performance for the month of may, but still only down by about half a percent. right now, it looks like the ten-year is yielding 442. the two-year is 4.83. global oil prices weaker this morning. our next guest is pointing to higher for longer rate concerns. she's also gearing up for a key opec meeting. joining us now, helima croft with rbc capital markets. i think that we haven't seen you much, helima, which is kind of indicative of what's been going on in the oil patch, hasn't it? >> i've been traveling as well, joe, to the middle east. but yeah, oil is a pretty unspectacular story at the moment. i mean, we're kind of rangebound. we have this morning, this slide due to rate concerns. but also, we don't have a shortage of oil on the market,

particularly at slight sweet barrel. there isn't this anxiety that we are tight in the oil markets. now, we could see over summer, european refineries coming out of maintenance, potentially 600,000 barrels of demand coming back. some port repairs in guyana, taking 200,000 of exports off the market. really, right now, we're kind of stuck in this range. we will be watching what happens in less than two weeks' time at the opec meeting. do they go in person. do they do additional output action? do they roll everything over? i don't think anyone's anticipating at this current price level, they'll be putting barrels back on to the market. >> the markets really haven't given us any signals for either the demand side or the supply side, i don't think, helima, or things are really in equilibrium. >> we have a situation if you look at products. diesel looks soft, but gasoline looks relatively strong. i just don't think that there's a lot of conviction right now in the market. whatly say is we've basically

lost all the geopolitical risk premium that have been driving prices higher. and after we have that israel/iran exchange of fire, i think a lot of people are saying, i don't need to worry about the middle east anymore. i mean, the war continues, but i'm not worried about geopolitically driven supply disruptions. and even over the weekend, we had that helicopter crash, the death of the iranian president. there was no international dimension to that. so people see this all as a very local story right now for the middle east, with no real energy implications. >> there have been some other parts of the commodities conflict that have been a little more interesting, helima. that's why it's hard to draw any macro conclusions from what's happening in the oil patch. >> again, i think what's interesting about oil is, is just the physical market right now. we are not in a supply deficit situation. again, certain barrels look, you know, in particularly abundant supply. we're not having the anxiety

that we sometimes get going into summer. that said, we still have summer driving season ahead of us. so we do see us in this brent price range of you know, 80 to 90. we think brent will average about $84 for the remainder of the year. but we have to see what comes out of opec, and we will be watching for any sort of geopolitical surprises on the horizon. >> just in passing, you mentioned what happened in iran, helima. but like so many things, he was more, i guess, characterized as a logistics guy, the sort of just, you know, follow orders. and nothing's changed there. but eventuallysomething will change there. >> something will change. we're going to have elections on june 28th. but importantly, he was a logistics guy, but he was also seen as a leading contender to be the next supreme leader. and the supreme leader of iran is basically mr. everything. and so, the question is right

now, are we looking at a situation where the supreme leader essentially hands off to his son. that might not be universally popular within elite circles. so could you have some elite crackup in iran? we'll have to wait and see what happens in his elections in june. do you see the opposition come out in force. the economic situation remains pretty abysmal despite their oil exports. we will be watching what happens around the june elections and with succession going forward. >> thanks, helima. >> thank you! >> and don't be a stranger. >> okay! i'm at opec! >> doesn't mean you've got to run oil up to 1 hur00 bucks, th. >> don't worry! >> see you later. when we come back, former u.s. chief technology officer aneesh chopra joins us live. we'll get his take on open ai losing two leaders in charge of a key safety team.

stay tuned. you're watching "squawk box" and this is cnbc.

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two leaders of an important safety team at open ai left the company last week. that effectively dismantled the so-called super alignment group which was focused on the long-term risks of artificial intelligence. posting on "x," one of those leaders said, "building smarter-than-human machines is an inherently dangerous endeavor. openai is shouldering an enormous responsibility on behalf of all of humanity. but over the past years, safety culture and processes have taken a backseat to shiny products."

joining us right now to talk more about ai safety and types of guardrails that might be needed is aneesh chopra. he's the former white house chief technology officer, now the president to have care journey. and aneesh, what do you think about this? does this raise the risks that there will be compromises made in the name of progress? >> well, i don't think it means compromises in the short run. this is definitely a long-term r&d effort, and it's an effort that countries around the world, including our own united states new ai safety institute are focused on. there is clearly a need to have ai safety research underway, well-funded, and well-supported. what you're seeing in the open ai story is really a -- kind of a modernization or a maturation of a company that has to make trade-offs. and in today's environment, you can see the competition is clear and vigorous, and as you noted in that tweet thread, basically,

resources were re-allocated from some of these longer-term projects to sort of near-term needs. it is concerning that you see certain unforced errors coming out of the openai team more broadly, but on this particular matter, i think the long game is public-private collaboration on safety. >> and the tradeoff being that you think it's going to be a less safe process over the long term? >> well, one individual company managing safety research for the entire sector may not be sufficient. we saw this in social media where the companies didn't really work well together to establish guardrails and we saw what we saw in the social media misuse, if you will, misinformation challenges. so having more collaboration opportunities may be a net positive going forward. the key is, we absolutely need as a society an understanding of the possibilities of these technologies. i'm an optimist, but there are obviously concerns and those need to be studied and we need a

process by which the major companies, the frontier model companies incorporate them. >> aneesh, you say that and i laugh. i sounds a little crazy to think, okay, we have this process that's taking place. we're going to move and eventually see something. facebook was founded 20 years ago, 2004. we still have not seen regulatory oversight that takes care of things like child exploitation. that's not to say there aren't great things these social media companies have brought, but self-regulation has fallen short, and washington is behind the curve as it always is with tech technology. go ahead. >> her is the slight friendly amendment, in social media we didn't really have a mechanism for public-private negotiations on minimum standards. that just didn't happen. here in august of last year, late july, the frontier model companies made a commitment to transparency on their red team in safety efforts among other commitments.

there's now a mechanism where these companies are working hand in hand with the federal government, and you're seeing copies of this model overseas. i think we're a little ahead of the curve. >> i would disagree. i think artificial intelligence can bring wonderful things to humanity. i'm personally very excite about the aspects of medical advancement that could come from this. >> my passion. i share it. >> so i'm excited about that aspect of it. i'm also worried about what this could mean if it's unleashed on society. a lot of people have compared this to what weave seen with oppenheimer and the changes with nuclear power and nuclear bombs that came with that. that's not something we would leave up to a public-private partnership in the industry to self-police itself. we would need regular oversight like we do with the nuclear regulatory commission. >> let me be very clear. we have existing rules on the books for outcomes.

you can't use the technology to discriminate on mortgage applications. you cannot use the technology to discriminate on your health care. so the agencies that have outcomes focused regulatory authority, those sectors have made it clear publicly you can't use the "dog ate my homework" excuse. the ai isn't going to give you a hall pass. >> i'm worried about using it behind profiling and discrimination. there are bad outcomes that can come from this. you've seen sci-fi movies that have taken this to the extreme. >> would you rather trust one enterprise to to do nobly? >> no. although i don't know there's anybody in washington -- this is happening so quickly, it's so advanced. i don't know who is in a position to regulate this properly. when you ask anybody in industry, they say, well, we don't want regulators to slow things down. that concerns me. >> remember, becky, there's this concept of people sitting around

the table who are in shared interest towards advancing the common good. think of government with a lower case g. the government has set a table and those parties are coming together, and they're evaluating and understanding with stakeholders in the research community and others. because that table is being set, the convening power, much more is happening in this space than perhaps a little bit more of the, well, let's see what the companies can do on their own. so when you hear regulation, i'd be skeptical. when you hear a table is convening and there are stakeholders at the table, that gives you more confidence, i hope it would. >> i'm trying to look back at a place where this has worked, wah an industry has said we're going to self-regulate and there haven't been any problems. >> certainly you will be involved and agile, identifying key threats that have more aggressive posture. right now the key priority is identifying baseline capabilities to make sure when and how should we watermark what

content is out there in the public domain so it's clear to the public this was generated by ai. >> let's talk about the headline of the day. that would be scarlett johansson suing open ai for stealing her voice she thinks. >> well, it's an unforced error for obvious reasons. i don't know exactly whose idea it was to tweet her. >> it was on sam altman's account himself. >> i get it. not the smartest sweet. we have a lot of folks in the tech sector who aren't smart on they tweeting. >> the tweeting is where we caught him. okay. you really were trying to get us back to this point. >> nobody should tweet. >> yeah. people should, but they should be more cautious. i think the point is it's a new company, the commercial products that we know of today is the chatgpt are two, two years oath.

they need a bit more maturity in some of these processes. i don't imagine they had done something so neglectful as to actively mimic her voice without negotiating. that's beyond what i would imagine they would have done. >> that's what she's saying they did do. we'll see more. aneesh, thank you. priat. i more to come. >> thanks for having me. >> "squawk box" will be right back. ♪ (alarm sound) ♪ amelia, turn off alarm. amelia, weather. 70 degrees and sunny today. amelia, unlock the door. i'm afraid i can't do that, jen. ♪ (suspenseful music) ♪ why not? did you forget something? ♪ (suspenseful music) ♪ my protein shake. the future isn't scary. not investing in it is. you're so dramatic amelia. bye jen. nasdaq-100 innovators. one etf. before investing, carefully read and consider

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welcome back to "squawk box." i'm dominic chu. macy's in the earnings report, mixed report. profits came in better than expected. revenues shy of expectations. general signs of a turn-around plan taking hold and macy's is seeing positivity on that, up 2.25%. on the other side of things, lowe's on the retail side up 2.5 to 3% at this point, better-than-expected earnings and revenues. it also saw a smaller drop in sales at established store locations. the do it yourself customer may be flagging a little bit there. check on cryptocurrencies, bitcoin up about 71,000,

ether -- joe, watch some of those stocks getting a bid. i'll send things back over to you guys. >> i'll watch if you say please, dom. >> pretty please with sugar on top. we've got to go. make sure you join becky and andrew tomorrow -- >> andrew is off -- i think mike san toll any. pretty please with a cherry on top. we'll see you tomorrow. bye-bye. good tuesday morning, welcome to "squawk on the street." i'm carl quintanilla with jim cramer. david faber is on assignment. oil is down a buck and brent back to a two-month. our roadmap begins with waitingo