market site in times square. i'm becky quick along with andrew ross sorkin joe is off today guess what >> what is that? >> it's tuesday. monday is already gone the toughest entry day of the week four-day week. >> tuesdays are tough. on after a long weekend. >> mondays are tougher tuesday is here. it makes it easier this morning, you are looking at green arrows check things out dow futures indicated up 16 points it was a down week for the dow last week. it was off 2.3%. the nasdaq actually closed at an all-time high on friday. it's indicated up almost 100 points today you have the s&p 500 up 15 points both the s&p 500 and nasdaq are sitting on five-week winning streaks. boeing was a big problem for the dow. if you look at the treasuries, 4.45 for the ten-year yield.

let's talk about meme stocks gamestop shares are higher after friday's close the company made more than $933 million by selling 45 million shares that works out to a sale price of $4.27 per share. amc also announcing it completed a share sale that stock is up as well i would have thought it would have been better for amc because of the debt. any debt they could payoff and return to the shareholders is better for gamestop, different story. unclear why those shares are rising the way they are here. >> you can probably look back at roaring kitty for sitting up and taking notice. >> sure. if you raise -- that's a straight delusion story. it is.

on the squawk planner, you have earnings to watch. we will hear from box after the clo closing bell salesforce and dick's as well with dell finishing up on the economic calendar, you have the kay shiller home brace prices you have the beige book and on friday, you have the personal income and spending and the inflation gauge and pce that is what the market is keying on as we look ahead. also, closing arguments are set to begin today in former president trump's hush money trial. the case could go to the jury as soon as tomorrow donald trump faces 34 counts of

falsifying business records to pay hush money to stormy daniels. we will talk to axios reporter later this hour. and elon musk's xai is funding values after the round of $24 billion the funding round backed by horowitz and sequoia capital and the kingdom holdings among others musk recently told investors that xai is planning to build a super computer the report saying the company could partner with oracle to develop that computer which could be running by the fall of 2025 they talked about a gigafactory or gigasuper computer. we will see what that looks like

this, to me, is the more important story in other news, glass lewis is looking to reject the pay package of elon musk the diluted effect when it is exercised. the pay package crafted in 2018, but a delaware judge voided it earlier this year. glass lewis said musk has taken on a slate of time constraints the advisory firm recommending the chair vote against the move from texas to delaware what do you think? >> if he doesn't get the pay package, do they actually lose elon musk? does he say forget it and he's checking out >> you were against the pay package originally. >> i was impressed

i thought it was a crazy pay package. i thought he could not hit the milestones he hit every one of them if you are a shareholder, you probably feel very devoted to him despite the stock coming down now and the sales numbers coming down. >> there are two pieces to this. one, it is no longer a $55 billion pay package. i think people are looking at 45 or 46. i would say it is down to 43 irrespective of that, the point is i think you are playing with fire at this point if you are a shareholder >> if you claw this back >> i think you are playing with fire as i said, back in 2018, he could go to a beach and do nothing if he really wanted. he owns a lot of tesla, but he has spacex and other things to do he is a busy guy. >> go to xai and spend time

there. he has accomplished it. >> it is easy for glass lewis to sit around and if you don't have a stake and say i don't want to pay him. it's okay. if you don't pay, then the chances -- i think you are raising the risk if you say no, what do you think happens? he's not -- >> when somebody has been working under the assumption >> the contract law thing, i agree with the law the judgess in ds in delaware d agree with me. the risk on the table is he really just says screw this whole thing. good luck to you people. >> major tesla investor said over the years that the biggest thing he worries about is the key management this company is not all that valuable without moofrkelon mus there. to me, i have a hard time

clawing back something so many years later. it turns out it is more valuable than he realized it was because he hit all those milestones? that seems like a ridiculous situation. they should have brought this proposal a long time ago and voted it at the time, no one actually thought or few people thought he would hit all those mile stston. >> the reason why this is on the table now and people believe this is illegal. the vote won't matter. there is a view the vote won't matter >> because of the contract >> this has to be structured in a different way. >> this was such a strange one because it is so many years where he hit all these milestones i have a hard time understanding how you don't give that to him when he's already done the work. china looking to bolster the

semiconductor industry raising $48 billion in its third national chip fund in competition with the u.s china's ministry of finance is the largest investor in the new fund which attracted investments from the state-owned banks and investment vehicles. we will get a live report from beijing later this hour. when we come back, minneapolis fed president neel kashkari speaking to our colleagues in europe overnight we have his comments on the fed's rate path stlaraight ahea later, less than a month to go before the first presidential debate we will talk debate prep later this hr.ou "squawk box" will be right back. unlocking the power of thinkorswim, the award-winning trading platforms. bring your trades into focus on thinkorswim desktop with robust charting and analysis tools, including over 400 technical studies. tailor the platforms to your unique needs with nearly endless customization.

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...i don't want to miss that. that's amazing doc. mobile savings are calling. visit xfinitymobile.com to learn more. doc? welcome back, everybody. minneapolis fed president neel kashkari making headlines overnight speaking to cnbc's karen tso. >> we are seeing a body of water between your commentary and the market expectations. wi what will it take in your view to get to one or two cuts this year >> many more months of possiiti inflation data to dial back. the u.s. economy has been resilient. gdp is strong. more people thought we would be in recession we had strong growth

u.s. consumers have remained resilient. i'm not seeing the need to hurry and do rate cuts i think we should take our time and do it right. >> kashkari also saying the central bank could potentially hike rates if the rates fail to come down further. we get a key read on friday. that is the fed's preferred inflation gauge. for more on how those could impact the central bank's take on raise, we bring in lindsey pieza from stifel. this is not a surprise from neel kashkari this sounds like what the fed has been significant the signaling over the last month. >> no, certainly not kashkari is one of the fed officials reiterating the broader patience and quantifying that message to suggest it is not just a need for several

months, but many more months of improving inflation data before the committee could justify the adjustment in rates. the committee still maintains the bias of rates. the next policy move will likely be a rate reduction. with a little over half a year left, it does appear to be increasingly to be a 2025 event. >> that maybe is not necessarily a problem. the market was looking for six rate cuts at the beginning of this year. it's come down to the idea where we are used to the idea of zero. it has not performance. is there a point where you think that changes >> i think the point, the pivot point, the fed needs to shift the message from eventual ratern

rate hikes again, that pivot point for the market is if we start to talk about when the fed not just delays rate cuts, but considers reengaging further rate increases. >> what is your sense of inflation at this point? does the fed pause and look around for a while and the inflation issue will be dealt with >> there are two scenarios if it remains at the elevated levels or push higher from here, the fed will maintain position on the sideline if we see inflation continue to rise away from the fed's 2% target, given the fed has a very distinct dual mandate with the full employment. if we see inflation moving away from the stability target, the fed will be backed into a corner the fed won't like it because it risks the credibility or calls into question the terminal rate

decision at 5.5% again, if inflation does appear to being moving way faway from target, it will be backed into the corner and raise 25 basis points or more depending on how precipitous the back up comes. >> people are saying if it is 0.3%, that is hot. we are also talking about carrying out an extra d decmil place. that is not necessarily the stuff that is going to make the market think if it is 0.26, that is not a rate hike coming next. >> certainly not .10% is not going to shift the thesis that being said, every additional data point, every additional month of hotter than expected inflation and movin away from the thesis does begin

to gain credibility for the alternative argument that the fed with the hyper focus on achieving that soft landing did stop short of the sufficiently restrictive level to maintain inflation and build evidence that the fed will need to reengage in rate hikes >> lindsey, we are expecting the ecb to actually cut rates in the coming weeks, next month that's a big deal if we are going to be seeing us not cut or them cut the first time they would be leading could mean it is them importing inflation because the euro could come under pressure how does this act with the central banks? >> they are responding to their own economic conditions. we have seen significantly

weaker growth overseas and elevated inflation and certainly not to the peak levels we saw in the u.s. early on, it was evidence that the fed had a larger job to do and stopping short of that sufficiently restrictive level, it has allowed growth in the u.s. to remain more positive than many of our developed counterparts it gives us less confidence we will see inflation proceed more precipitously as we have seen with the other larger economies abroad the divergence does put pressure on the fed to move in tandem, but at the same time, given the differential between the growth and inflationary scenarios, it makes sense why the ecb would be moving at a quicker pace toward easing while the fed still appears to have a bit of wiggle room or time on the sidelines. >> lindsey, thank you. good to see you. >> thank you for having me.

coming up when we return, disappointing at the box office. "mad max" sequel and "garfield" disappointments. we'll coming back after this

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welcome back to "squawk box. warner bros. "furiosa" surpassed "garfield" at box office for the four-day weekend the worst memorial day box office in three decades. excluding 2020 when the movie

theaters were closed down. let's bring in matt belamy with more what happened? >> this is a disaster. if you count inflation, you are to go back to the '80s, the richard pryor movie. that is how long it was this little the industry thought "furiosa" would be a hit they did a full-freight marketing campaign it shows right now in hollywood, if you have the goods and people want to see the movie, they will show up. good is not good enough for movie theaters anymore. it has to be great this did not have enough to lure movie goers to come back they rejected it outright. >> matt, what's working right now? >> what's working is no

intellectual property where there is something you know and has seen before and something additional that brings you to the theater. something fresh and something you didn't know and it is a spec spectacle. you want to see it now and you want to see it on the large screen we see can the imax and large screens are taking up 25% of the box office some weekend because p people are showing up to see a spectacle. something they cannot get on their screen at home if it doesn't have that, you're dead. >> matt, adam aron, is a character in what i'm hearing world, what do you make of him selling shares in the company over late last week? what does that do for the company given the debt load? does it make you feel better about the company or worse about

the company? it should put shareholders in a slightly better place than before. >> adam has a recent history of selling shares when they get inflated or boosted by the apes or retail shareholders they did it during the pandemic when amc shot up he is doing it now with this boost, not as big as the meme stock of the pandemic, but, you know, he says it is estate planning he says he is on the side of the shareholders you know, it's a tough one because he is a big cheerleader for the company and big shareholder. he says he is with them the whole time then you see him selling and you wonder a little. >> let's switch over for a second you have another part of the newsletter this morning talking about warner bros. discovery

david at risk of losing wrestling. >> the nba is not official yet all signs are pointing him to losing it to comcast he is in the exclusive window right now with all elite wrestling. wwe competitor that turner broadcast for the past five years. those rights are up. if he loses nba and goes into the exclusive window which closes in july, he's got to get this or else it is another sports league that would be leaving the turner stations. that absolutely weakens him in the carriage negotiations. if these turner networks do not have sports content, they are really in a tough spot for carriage deals

they have march madness and baseball and he did a deal with disney for football games. wrestling is a constant program. it is five hours a week year round. he needs that if he wants to keepcharging for carriage. >> switching gears on you again. i don't know if you saw "wall street journal" this morning streaming deals are here and you may need to look at options. i'm curious who wins on the packaging on this. not the individual players when you look at the individual packages we have netflix hooking up with peacock and apple tv does that seem like a good bundle to you with espn or maybe netflix or verizon max package on the other >> the netflix and peacock and apple one is a marketing relationship it is only available to subscribers of the comcast

broadband. that limits that reach again, comcast is a pretty good history of marketing cable and video packages they will probably do a good job marketing this it's got limitations on it because it is only to the broadband customers and it is the ad tier of netflix netflix is the big elephant in the bundles. all of them want netflix netflix is not doing a bundle with the ad-free version they want to push the ad tier for scale for the advertisers. i'm not sure how much of a boost this is going to be for the comcast side the other ones, they're marketing relationships. if the verizon one can work,

verizon has a history of streaming bundles and marketing. look at what happened when d disney plus launched that was huge to get to mobile customers and get the subscribers. these things do work i just don't know how additive it is a mature streaming market. as the article notes, you have to be a pretty savvy consumer to navigate all this stuff. >> matt, i want to thank you i know what i was going to ask you. i saw "the fall guy" over the weekend with ryan gosiling it is an amazing movie i don't think it killed at the box office what happened? >> it did not. it is not intellectual property people cared about it doesn't feel big enough especially for the first weekend in may with the summer kickoff >> you have to be a marvel s sequel to get traction at the box office >> that's what feels big

it doesn't have to be marvel it has to be something big even something like "dune" which is not that well known ip before the movies came along. the first one delivered. the second one had that scale. it felt like you had to see it on the big screen. that's what lures people in. "furiosa" did not bring much to the party. "the fall guy" was super fan and if it was released in another part of the year, it would have been fine. it was released in the summer. people rejected it >> i watched it at home. >> you're the problem. >> two thumbs up to emily blunt and ryan gosling thank you, matt. >> thank you. when we come back, china raising $48 billion for a chip fund we will have details next. and the department of t stice accusing ticketmaster of a anti-trust violations.

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good morning welcome back to "squawk box" here on cnbc we are at the nasdaq market site in times square. the nasdaq is off 54 points. the s&p 500 is off 6 points. china raising $48 billion in funding for a new chip fund as it looks to ramp up competition with the united states eunice yoon joins us right now from beijing eunice, this is a big issue. semiconductors are looked at as the new arms race. the weapons in the new arms race >> reporter: absolutely. chips were on the mind of chinese premier li as well as the rest of the leadership he specifically was urging sam samsung, a major chip player, to ij invest in china as they look to maintain a connection with the supply semiconductor chain

he was looking at south korea in a meeting that was deemed the first three-way talks in years he called for an end to protectionism and end to the supply chains. this comes as janet yellen urged in the g7. they expressed concerns over the non-market policies. highlighting that, china announced an expansion to the main government-backed fund that supports the chip industry the national integrated circuit industry investment fund known as the big fund. the authorities in china are planning another $48 billion inve investment this would roughly double the size of the fund it is also important to note that in the trilateral meeting, president xi

jinping did not show up. only a week ago, he had met with the president of russia, vladimir putin, in a sign of changing priorities with policy for beijing. guys. >> eunice, china has been working at this for a while. they had billions of dollars that they spent in the decade leading up to this as early as last summer, i remember reading stories that the tens of billions of dollars were not paying off in the way they anticipated with the new developments in semiconductors why is this different? >> reporter: absolutely. there have been several people within the chip industry who told me the chinese are very far behind when it comes to chips. so, because of that, there is a frustration at the idea of being able to create a self reliant chip industry, but not actually quite making it. it is a big question mark if

this extra $48 billion would make much of a difference. in terms of the size, it's huge, but it is difficult to say how effective it is. in terms of the announcement, there wasn't a lot of detail in the investment plan other than authorities like shanghai putting in >> it is interesting to hear china talking about decoupling the supply chain when the u.s. has brought that up, it has been a big sore point. >> reporter: right the u.s. will often say the chinese had started the decoupling long ago, especially when it comes to, for example, the internet facebook or twitter or x are not allowed here anymore or at anytime. the perspective is china states the u.s. start the decoupling.

the state immedinee media and y comments are pushing back that china is in the wrong here. >> eunice yoon, thank you. we are less than a month way from the first presidential debate axios says some are urging congressional 235fights are to e delayed. you can follow "squawk box" with "squawk pod" and listen any time

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well come back to "squawk box. former president trump is meeting with allies. joining us right now is steph

keip at axios. how much of this is we should wait or we don't want to fight for it now, because if we do, biden might get credit >> it is a little bit of both. he was the director under trump. he met with senate republicans last week and urging them to kickback the government funding appropriations process to 2025 using the short-term mechanism cr this is something democrats are not a fan of the idea here is trump allies didn't want democrats to use the government funding process to hamstring a potential future trump administration they don't want democrats to put something in the legislation to block trump from using funds to the buld ild a wall along the

border there is the offense side of this where the republicans want to use the process if trump gets elected and republicans take control of the senate to include the priority issues in the package. >> how much of this is coming from president trump's campaign versus from others in the party? >> this is certainly coming from trump's campaign they are beginning the conversations with top lawmakers. in this meeting last week, this was the meeting with the steering committee in the senate which is a lot of conservative senate members it also included members of membership mcconnell was in the meeting john thune, the number two, and running for leader in the fall they were running the meeting. we also heard that trump, himself, has been communicating with leaders in the house.

steve scalise and mike johnson have been talking about it if republicans manage to run the tables and trump does win the white house. >> stef, i have a totally different question steve schwartzman appears to now be back -- steve schwartzman of blackstone -- backing donald trump after the january 6th attacks or riots or whatever you want to call them. prior to that, he said he would walk away or step away from president trump and was not supportive of him. do you see a sea change happening when, obviously, nikki haley, was on one side of the campaign for a long time and said terrible things about him and now switched gears what's happening >> we have certainly seen, especially republicans, come around trump now he is the only person in the race he is going to be the gop

nominee. we have seen all kinds of people who have been historical republican voters and who have been republican supporters, but r hesitant about backing trump and now willing to look past the issues with him in the past. look past january 6th and get past the person who is the stronger candidate on the one hand, this shows how weak joe biden is currently going into the election cycle. people who have been very critical of the former president are willing to say they intend to vote for him, including nikki haley, who not only a few months ago was leveling harsh critiques at him. >> how much of this is in lock-step or a power grab as nikki haley wants to be vice president or wants a role in a cabinet kind of thing? >> i think there is a little bit of both there, of course trump has made clear that he no longer thinks that haley would

be in that vp contender list which is still rather long we will watch to see whether she gets some place in the administration >> he did say she would be somewhere. there would be a job in the cabinet. >> i assume she switches gears because they wants a role. >> she wants to look ahead to four years >> this is certainly something we see in politics all the time. people change their tune when they see the sea change happening. she knows that trump is the republican party leader. he has been for a very long time now. she knows if she wants a future in the republican party in politics, she will have to make good with the former president >> all right stef kight, i appreciate it. >> thank you when we come back, musk's xai announcing a $6 billion round of funding we will talk to steve kovach about the plans and valuation.

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welcome back too "squawk box. steve kovach joins us now with more >> a group of well-known investors are involved in the big deal, fidelity, and sequoia

capital. xai will run on a super computer, but if you read between the lines it sounds like oracle's cloud packed with nvidia chips musk pitches it with a chat box with humor, and we got through with two weeks of opening ai and microsoft, and it's teasing it will help it catch up, and open ai is working on its next version of jpt also, more perspective here. you can bet a significant chunk of the money is going straight to nvidia to scoop up its best chips that costs tens of thousands of dollars of pop and the other chunk will go to

oracle or whatever cloud service if a deal doesn't materialize there. fidelity and sequoia capital are also an investor in the post bust twitter called x, of course, and they witnessed a significant value destruction, and what struck me is this guy destroyed their investment, and they said, give us more, please, we love that >> didn't get the ai side of it, probably >> it's interesting, the valuation and how much they raised, it's so clear that check is going right back to nvidia. >> we talked about some of the investors, they will get a small piece of xai >> did they get it or not get it >> it's unclear but sounds like that did not happen. >> they had to go in for a second round >> exactly

>> elon musk was denning the reports, and you can go back on x and see. what do you think is going on? this was not happening and then it did >> there were reports, and the silicon valley reports were talking and knew what was it happening, and elon musk famously doesn't tell the truth. >> how far behind are they >> they said this funding is going to help launch, and it's not -- it's okay it's fun but also like the fact that it's open sourced -- i was out in silicon valley a couple weeks ago. nobody is talking about this one as far as open source, and it's not in the conversation in the developer's conference we just went through, and this funding might make a change. they do seem behind and apple behind, too. >> thank you when we come back, the ceo

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the justice department suing ticketmaster owner, live nation, saying the company maintains a monopoly in the industry controlling roughly 80% of venues' ticketing. we have jack groetzinger, the ceo of seatgeek. thank you for being here >> thanks for having me. >> i was just explaining to you how i look at seatgeek and how great it made things for me in order of being to buy tickets,

and they have boosts ticket prices to some extent because ticket scalpers have a way to do it explain to me what is happening right now in terms of the justice department looking at ticketmaster and why you think that that is monopolistic behavior what has ticketmaster done >> we have had a front row seat to the illegal behavior. >> i look at ticket prices and think they are too high, and i don't have a whole lot of empathy for ticketmaster, and what do you see they do that makes it illegal competition >> they illegal tie content, meaning shows, to the company doing ticketing for a venue, and that has not stopped them from doing that and that's a shame because it means a worst

experience for fans and higher prices and fewer shows and a service that doesn't have an incentive to invest in getting better, because they know they can run their business if they go down or have higher prices, you don't see the industry getting better that's why i believe in free markets and i believe more people competing to build better stuff means better outcomes for fans and bands and everybody in the ecosystem. >> ticketmaster said their share has gone down. >> not surprised they are saying that per the doj, they have 80% of the market share until 2017, they had almost majorvenue in the u.s. and the were not losing deals, and we are fortunate to have dozens of major venues >> how did you do that i remember when that happened. >> we focused on technology, and

we are a technology company that happens to be focussed on live events, and if we can focus on something a lot better, people notice and switch. we have been able to get venues to see that and switch over for a better experience for their fans >> that sounds like an argument of why they should not be broken up, and if you were able to make this progress because you are better and investing more technology on that side, and what would be different if the justice department broke them up other than to weaken a competitor >> i would love for us to have to prove ourselves against many companies out there. >> didn't you just describe, though, the margin you think they are taking and the margin you are taking and what the difference would be if this was broken up? >> the thing they do is, you know, they have ticketmaster

that sells tickets and they own venues and are a promoter and manage artists, and they are taking fees and they are taken across -- >> i tried to ask the question of the doj last week, let's say there's a ticket price that is going for, i don't know, $500, and maybe it's a taylor swift and it's 500 plus dollars, and are you taking a lower margin than you are taking >> we are at or below the rest of the market in our prices. >> the bigger question is the consumer harm, right, we are sitting around and going the prices are too high. how much lower with the prices be if there was more competition? part of the reason i am asking this is because i actually fear that the prices are actually at a market price you may disagree and that's what i am hoping you will say

>> i do disagree i think if prices go down, and the specific amount will vary by event. and the other part that is really important is the service, the product that fans get will get a lot better you will no longer be able to exist and assume that you are going to get business. we want a dynamic market where there are tons of folks out there competing. >> echoing what andrew is saying, i think the high prices in the u.s. market in part are because of services like yours, services like ticketmaster, where, again, you can sell tickets if you can get your hands on these things and lock the tickets up, it's almost scalping with a technology assistant to do that in the united states we have a lot of money and people pay up for those things, and there's a reason ticket prices are so much more expensive where people are flying to europe to see taylor swift because it's cheaper with

the airfare included, and it's partially because you made it easier to get tickets without the intention of going to resell them >> europe, you see lower fees and lower prices and the fundamental reason is there's multiple ticketing companies that are able to sell tickets for different events and you have the more competitive environment and it results -- >> because there are lower fees? >> lower fees. >> is the fee 5% of the ticket value? 10% of the partticket value if you take out all the fees and remove every fee, we would be having a different conversation. >> what is it there in europe? >> you see lower fees. you see more companies competing on fees. i think that's what we are missing here is the fact that -- >> the competition on fees >> exactly

>> are your margins in europe lower? >> they are competitive with the rest of the market there and you see overall lower prices -- >> no, just tell me -- i am hoping you are going to say my margins are significantly lower in europe than here because of the competition, and if you can't say that -- >> we are not able to disclose our margins on a -- >> most of our business is in the uk and europe so it's one in the same i think what you are asking, ultimately, does it matter, if you survey fans in europe, you have happier fans and artists able to put on more shows in different places, and that's why it's exciting what the doj is doing because we are hopefully going to have that in the u.s. >> thank you for having me just after 7:00 a.m. on the east coast

you are watching "squawk box" on cnbc i am andrew ross sorkin along with becky quick joe kernen is off today. we have a bunch of stories to talk about this morning. ahead later this morning, the pricing home index we will get a core piece of data will released at 4:00 eastern time and proxy advisory firm saying compensation recently involved at $46 million could concentrate ownership. it was struck down by a delaware court in january

shareholders will vote on june 13th, and if they were to vote it down, what happens to elon musk and his role in tesla iphone users may get ai generated emojis when apple launches ios 18 this year. apple reportedly developing software that can create emojis on the fly based on what users are texting. a report says china iphone shipments were up 52% in april versus last year, and that may be even more important news of the morning. let's get a check on the futures this morning the dow has taken a turn for the worse. looks like those futures are off by 40 points the dow was down by two or 3% last week, and the nasdaq closed at a new high and is up 52 points, and the s&p on a

five-week winning streak along with the nasdaq is up by six let's get over to dom chu with a look at the premarket movers >> believe it or not, the holiday shortened mean stock is up again you can see gamestop, and they gained as much as 27% earlier on, and this is on the heels of a share sale to raise capital at the so-called market offering. again, it was announced earlier this month so it was not a surprise the latest iteration of the mean stock, they take advantage of it and pricing details were not disclosed but the company said it raised about $933.4 million amc stock also up in what appears to be a sympathy move.

other stocks are higher. and then draftkings and fanduel parent company, flutter entertainment, down 4 to 5% right now. the move is being driven out of lawmakers in illinois where they drafted a budget that has a tax on sports betting operators, so the stocks moving down in that news we will cap things off with the shares of nvidia, up about 2%. half a million shares of volume, and helping things out as the conversation you had at the end of last hour, about elon musk xai building intelligent systems and the money could be used to build al powerful super computer using nvidia hardware. the nvidia shares are poised to open at a new record high and saw the market cap swell to

$6.62 trillion back over to you, becky. >> we were just talking about ai raising that funding, and that's money that will be going straight to nvidia >> it's so secret their chips are part and partial for every system out there, and with new products coming up with blackwell, and if you have ambitions to build the best ones, you are using nvidia chips, guys. >> thanks, dom see you later. coming up in the evolving world of ai, heroic ventures, michael fertik will be our guests, and much more. we're coming back right after this 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.

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come back from a long weekend. you will see the dow futures down close by 50 points, and you have the s&p in positive territory, too it's up by six right now for more on the markets and the shortened trading week, we want to bring in our guest. >> thank you for having me >> you think we are having a classical late cycle markets move >> that's right. this is a classic environment where growth is strong and feds had to tighten because of inflation concerns, and in this case it was well invasion, and you are supposed to have stocks

and bonds because stocks continue to grow, and your bonds are now at yield levels where they are pretty attractive i think overlaying that, and we are seeing this today in the market, you have a secular trade in ai. >> that is what feels different, combined with federal spending on a massive level >> it really is different. we are seeing that roll in every day as companies want to make sure they are investing for the future here's the thing companies are being pretty disciplined in terms of making tradeoffs, so areas like software might be sources of funding and we have seen that through the earning cycle. >> i guess the thing added on top of the ai and technology spending taking place, is the federal spending already that was accounted for and flooding into the economy over this period of time, and the question that raises is does it make inflation a trickier beast this time around? >> that's the reason rates are

still high and the economy is not slowing at the pace you would normally expect. having said that, you are seeing the consumer really start to behave in reaction to this environment. >> sure. sure i guess my question is, does this change -- we're fine and i think the market is okay if we don't see a rate cut anytime soon and the market may change its mind if the next move is a rate hike, and if they have to do something because inflation is stronger or picks up speed again, that's a different ball game >> i would completely agree with you. i don't think that will end up happening. i think what the fed wants to prevent from happening is the market getting ahead of itself, and lowering rates on its own which is what we saw at the end of last year, and that creates an inflation problem you will continue to hear hawkish talk or a mix of talk.

>> is that the strategy, a mix of bonds and stocks? >> it makes the most sense it's historically what would be done, and commodities would be added because they are a good later cycle play >> and then bringing up the geopolitics, and it's hard to know on so many levels whether you look at russia and ukraine or china and taiwan or the middle east and what is happening with israel and beyond how do you factor any of that in, or do you say it's too tough and ignore it and set it to the side >> you need to look at the actual policy and economic impacts of all the geopolitical situations in the middle east, you care about oil and oil supply, and oil is being held back you should be less worried than you normally would be. >> but it's not the 1970s

because we have so much production at home >> yeah, we are a net exporter in the case of china, it's about the driving demand on investment onshore versus japan and mexico and vietnam. i think you look at each one of those and there are net affects. the last 30 years i have been investing, there's been geopolitics, hot wars and cold wars >> some people saying, well, the inflation may go away -- >> i think you are starting to see decelebration of earnings growth you will see a slower market environment, and that's why you are seeing this drop in volatility, because there's underlying strength where the uncertainty is narrowing i think as we get towards the

election, you are really going to see the market go into a range, and then depending on the outcome of that election, we will see what happens. >> thanks a lot for coming in. >> thanks for having me. >> nice to see you when we return, office real estate, will the government have to intervene to save analysts. (music playing)

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welcome back bg everybody. there's a new report out showing loan modifications are rising faster than a year ago diana olik joins us. >> the prospect for significantly lower interest rates is pushed further out and we are now seeing a big uptick in modifications in the first quarter of this year there were $1.42 billion in office loan modifications, and that's a jump from $117 million

last year in the same quarter, and that's not a good sign for the market >> it really just transfers the risk down to future years where you know borrowers are hoping interest rates are lower and occupancy rates are stronger, and the reality is 18 to 24 months, i don't see a lot of changes happening. >> and the terms are very short. the incentive had been for lower interest rates but that's not happening now as quickly as most thought solooking forward there's less incentive for additional modifications, and not a good sign for lenders holding the bag like bank of america and wells fargo. >> if they start getting the keys back, i would expect some additional government intervention or some sort of stimulus or public or private partnership that will try to stimulate that side of the ccr

equation >> and there's about $30 billion worth of maturing office loans left in 2024 overall, cmb delinquency rates surged to the highest level. >> that's been the biggest question, we have known there would be lenders who had -- or borrowers that had to walk away and hand the keys back over. the question becomes the idea of whether there needs to be government intervention or not or whether there's enough private money on the sidelines willing to come in at lower prices we were talking and he was saying for get about it and throwing in the towel unless the government intercedes. what would be the reason the

tp government would want to intercede? >> we talk about the extent and prevent, and there's dry powder on the sidelines waiting to buy some of the distressed properties, and some of the borrowers won't be able to do that given the kind of debt they are in, and some of the properties have big debt on these and they will hand the keys back, and can the banks sell those to the investors on the sidelines and at what prices and that will determine whether or not the government has to step in. >> thank you good to see you. coming up, the evolving world of ai and how to look at the instdury, and michael fertik will join us the s&p is up about four points. the nasdaq up about 41 points. we're coming right back.

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a hacker group called ransom hub is claiming responsibility for a cyberattack on kristy's auction house earlier this month. ransom hub said it gained access

to the personal information of the firm's wealthy clients and published what it claimed was a sample with a few names, nationalities and birth dates. that group posted the information along with a countdown clock suggesting they would publish the entire trove in early june, claiming the attack encompasses many of the clients. joining us, michael fertik you have lots of thoughts about where we are in the ai i kul let's start there, and then i want to get into maybe not the ethics of it but the regulation of it all. >> good morning, andrew. hello, everyone. we are in the hardware moments of the ai cycle, which is one of

the reasons a company like nvidia is still rocket shipping, and nvidia is the largest vendor by far to ai hardware consumers, which are companies, in the same way google search and microsoft search bing for a long time has been a driven field, and right now the gains are going to the hardware companies in ai, because the foundation models like gpt requires a lot of hardware to process all the information to make the big general models, and that will change and the costs will come down and there will be a proliferation of smaller models that are used for certain

purposes and dough pmains, and >> i was in paris last week, and robin lee was there, and he was talking about how in china they already moved away from the larger models and there are lots of smaller models being created. the question, though, is in the large language model business, does that become a commodity business what happens to those software makers microsoft, google, anthropic, amazon has a stake in them, and is that the right bet on the software side? >> you make a good point sort of indirectly about china china has one advantage when it comes to making models, which is they have the backing of the ccp or government and they can get access to data that american or

western companies can't because they have a firewall that forces them to give their data over to the government, and they are ahead in some of those things and the united states and the west will catch up and surpass them, i believe. you asked is there a arms race or commodities race now, and i think it's premature to say yes, because as you can see, not only is there exciting financial news, elon musk raises $6 billion for his xai, and so on and so forth, but not only are these major fundings still happening, but also if you look closely, which is my job, every couple of weeks, one of these foundation models over takes the others in certain applications i don't think it's close to being close to being close of seeing one model to rule them all, or two or three, and we are

seeing the fast breaking innovation pace and that will continue for several more years. alongside that as the costs come down and as the cap x comes down, there will be specialized team for coding, for writing, for media, for the arts -- >> i can't figure that out if the large language models are so good, why are we going to live with the small language models, and where the competiti competitive mote is going to be for the competitive product if agi is coming? >> well, we will get back to philosophy, if you are willing pretty much all the large language model and general models are pretty good at writing some form of code, usually simple, fresh, new, clean code for a simple application. imagine a group of people that

might specialize on just, let's say, translating java just to python you don't need to know how to wright a poem in the style of shakespeare in order to translate java to python you just need to know enough, the proprietary examples of java and python, and then you can outperform -- >> i don't disagree, but isn't there a possibility that the price of powering these things does come down it's sort of like, remember when gmail allowed you to archive all your mail, and you don't need all the mail but the price where it could be stored came so far down, people said, screw it, i

will just press archive every time >> imagine andrew wanted to have a model that wrote emails to people, and andrew did not want to spend time on that himself in the voice of andrew, and can you imagine soon a relatively small computer minding all of andrew's emails, with people he doesn't want to correspond with directly -- that could be done on a laptop pretty soon. that does not have major commercial operations, and you can imagine there are different kinds -- joe kernen might be, maybe not you, but there are different industries you could make that could be built on the back of smaller models, like bio

engineering and entertainment. this should be the future. i think it's welcomed. the cap x costs usually come down in every industry, right. that doesn't mean it will be the end of model generation, and in the field of cyber security or spam, some people thought the cyber security problem or spam problem would have been solved 15 years ago, but it got more fragmented as the hackers got smarter and the defense had to get better and smarter as well >> michael, we are going to leave it there it's a very in depth conversation i hope we get to continue it with you thank you. >> i know your industry is very big, andrew. >> thank you we're working on it. we're working on it. when we come back, kicking the tires on a car lease, why now may not be the time to be

doing that we will talk about that, next. later in the program, a rough holiday weekend, and is it a sign the summer box office could be a bust. we'll talk about that. "squawk box" will be right back. we still see the world with the wonder of new eyes, helping you discover untapped possibilities and relentlessly working with you to make them real. old school grit. new world ideas. morgan stanley. glp-1 drugs used in weight loss treatments are a global blockbuster, even with unliked and inconvenient injections. more human study results for lexarias patented oral delivery technology are coming soon. lexaria bioscience.

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leasing is back at the car lot after several years of dealing with tight supply, the tables have finally turned but the question is for how long phil lebeau joins us with more what is the story when it comes to leasing >> a lot more popular than it used to be in part because of what you said, becky there's more supply and if there's greater supply there are people who are on that train, that three-year lease plan it was taken away because of the chip crisis. look what we have seen over the last three years remember, the chip crisis, it's severely constricted the new models out there, and as a result the number of people who were leasing -- this is the percentage of overall sales every year, it was down as low as 16% in 2022 now this year, year to date, back up to 23.7% as we mentioned, greater supply is what drives leasing activity. there was such a supply shortage

of chips that the automakers were constricted in terms of what they could sell to dealers who would ultimately lease the vehicles the current monthly lease payments, because they are lower than auto loans as we have seen the monthly payment for new vehicles go north of $700 for new vehicle, and if it's hundreds less per month for a lease, that's what i will do how long will it last? it depends on whether or not the cycle continues in terms of people coming in bringing previously leased vehicle so they lease a new one that will change in 2025 because in 2022, there were fewer vehicles to lease. there will be only about 2 million vehicles that are going to be coming back in 2 million people who will say, yeah, i am ready to lease again. there could be some people that come into the market, but that

generally is what fueled leasing activity in the past leasees continue to lease. automakers tend to be the leading leasers. they had greater say apply to increase the number of vehicles out on the lot to lease. back to you. >> has there been a drop like that you are talking about a 30% reduction in leasing when you are talking about 1.9 coming back from 3 million. was this -- >> you saw a little in the financial crisis, but there were other factors that played into leasing activity falling off as much as it did it's really driven, becky, by supply, and by people where it's part of what they do, they don't

want to buy a new vehicle but lease one every three years. i heard during the chip crisis by so many people coming off a three or four-year lease, the dealer said sounds good, now i will take that back. you can buy it for a ridiculous price because of the tight supply in the market, and those people said i will not lease anymore. as a result they got out of the rotation that's what we are going to see in 2025, fewer people in the rotation of bringing vehicles back >> phil, thanks a lot. we will see you later. >> you bet rs> coming up, president biden rs> coming up, president biden veus forme and diversifying into rare earth elements, key r trump.edients in many clean ey and defense technologies. energy fuels.

we have deal news for you this morning t-mobile is paying $4.4 billion to buy the wireless operations

from u.s. cellular u.s. cellular will remain its cell phone towers, and t-mobile will sign long-term licensing deals to use the towers. the controlling shareholder, tds, signed off on the deal. u.s. cellular is up by 7%. former president donald trump' tax cuts changed corporate tax rules, and most corporate tax changes are permanent. president biden's proposed raising the corporate tax rate if he's elected bringing new debate to the state of the corporate tax codes. joining us now, the former director of the cbo and harvard school professor, and let's start with you, doug

if, in fact, former president trump wins again and were to try and keep the tax cuts in place, which is what i imagine you would want to happen, is there a pay for in your mind >> well, i think the key here is to look at 2025 as an exercise in tax reform and in the tax reform, we need to keep rates low to broaden the base, and there was a base broadening on the corporate side you can go back and do more of that no question about it the other thing to keep in mind, andrew, if you decide, as the president proposed, if you want to increase it to 28%, the rate reduction will be an enormous success. since we did that, we have not lost a headquarters -- >> but two things real quick do you think the 28% is a real

number or an anchoring device to the fact that actually it seemed like the corporate world was ready to accept 25 last time >> jason or me >> oh, you are asking me sorry. yes, look, there's a number of good things in the tcja. i would like to see a number of it continue. first of all, we should not exaggerate the growth ae srebgts and there have been a number of studies that said it added less than 0.1 of a percentage point a year globally. you are not seeing corporate tax falling but they are rising. if we want to have tax reform, the first thing you have to start with in tax reform is what you want your revenue to be, and right now there's a $4 trillion hole in what president trump proposed in terms of extending the tax cuts, and president biden faces real challenges,

too, because he wants to extend them for everybody below 400,000. either way we are going to need more revenue, a higher corporate rate is one way we can do that >> jason, before i go back to doug how would you do it? you are king for the day, and you can do -- >> king for a day? i might get doug to join me, understand the tax base matters as much as the rate. i might do border adjustment on destination-based cash flow tax, which doug was a champion of once you do that, can you have a rate of 28%. but economically on new investment you have a much better incentive than what we have now that expensing is very powerful. i would do that, raise revenue and increase the growth, and revenue is really important with the unsustainable deficit right now. >> doug? >> andrew, i think what jason

pointed out is something that is really important and people should recognize if you allow the expensing of the investment and expensing of rnd, no matter how you choose to enhance your company, equipment, business deductibility, you remove the distortion of how you finance those. that's what 2025 should be all about. getting a more efficient tax code second thing that i would point out is, everyone agrees that the corporation is not paid by corporations the president's proposal to raise the rates to 28% would impose a $500 billion tax on people making less than $300,000 that's a treasury department estimate it would violate his pledge not to tax people under $400,000 but if we're going to be realistic and tax those people, let's do it in a more efficient fashion, let's go to the international side and broaden the base there that's what taxes should be about, broadening the base on the individual and corporate side >> we weren't going to do the

individual right now, but let's talk about it. >> you can't avoid it. >> what would you do on the individual side, doug? >> here's the thing to recognize. more than half of business income is taxed on individual income tax returns as passed through income if we taxed all of that as operations, we would still be raising the same amount of money in the corporate side that we did in the 1960s, but it's disguised now, because it's business income on individual returns. that's the most important issue coming everyone's focusing on raising the rate on the corporate side that's not what matters. what matters is what are we going to do with the pass-through income and what incentives are we going to place there? that's a place to relook very, very seriously because right now, we have very big, very different tax rates between corporate income, investments in corporations, investments in partnerships, an. you want to equalize those rates of return whenever possible. >> jason, what do you do to the individual rate, then? >> on the individual rate, i would let the rates expire and keep the base changes that were made in the tcjh, expanding

the standard deduction was a great increasing the child tax credit was another great exemption. we can't afford all of those rate cuts. i would be fine with broadening the base, but the numbers just don't get you to where you need to get you could get rid of the entire mortgage interest deduction, and that wouldn't raise enough revenue to pay for even a fraction of making the 2025 tax cuts permanent so, you know, unfortunately, you're going to need to bring rates in here. the reason we have a tax code is to raise revenue we're just not raising enough right now. >> and do you think there's any chance -- i would just want to agree with jason skand just poit out, if you want to broaden the base on the individual side, the biggest thing left is employer sponsored health insurance jason is painfully aware of how difficult it is to bring that into the tax base. pd president obama tried it and never got implemented.

if we're going to get serious about broadening the base, that should come back but fif you aren't willing to d those things, the rates go up. >> doug and jason, i imagine we'll be battling this one out for quite some time. thank you. >> yeah. those two could sit down in a room and put something together it might actually work, if they can agree on it. when we come back, the value meal battle heating up, but how do franchisees feel about the plans that have been put forth for mcdonald's and burger king we'll hear from a mcdonald's owner right after this break right now, as we head to that break, check out shares of dell this morning, up another 4% to the premarket after touching a record high on friday. "squawk" will be right back.

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welcome back, everybody. mcdonald's new $5 value meal is set to hit menus this summer however, some of the franchise owners are concerned about the impact on their profits and are calling for more company support. joining us right now is scott roderick he's a mcdonald's franchisee,

owning and operating 18 mcdonald's franchises in northern california. scott, it's good to see you again. it's been about two months since we last spoke with you >> it's been about two months since this impact of the new california $20 wage and is it's been quite a roller-coaster. we've been impacting the impact on my customer, which is the most clear and present concern i have as a franchisee today >> what has it meant to your profits over the last couple of months >> well, this unprecedented and extraordinary historical wage impact, 25% overnight, targeted only to 15,000 restaurants in the state of california, it has impacted margins and at this point, instead of lamenting about ill-timed and poorly conceived laws passed by the state legislature, franchisees like myself are focusing on trying to increase market share obviously, you mentioned in the

lead into the story, we are about to launch this summer a revamp of the mcdonald's meal deal at $5, the competitive space is getting extraordinarily heated up and mcdonald's plans to be, my restaurants plan to be at the forefront of trying to bring some relief to an inflation-impacted customer. >> so you're in favor of this plan i want to use it against the backdrop, because i think what you're dealing with in california is probably more severe than any franchisee, anywhere, at this point. although everybody is dealing with the inflationary impact of higher labor and costs that go into making all of the things that are there, too. mcdonald's is using this as a national marketing campaign to try to bring customers back into the stores you have seen guest count face a little pressure. what do you think about the plan overall? >> well, we've certainly seen guest count pressure in terms of fewer customers coming to restaurants in general

and those that do come into the restaurants are spending less money than they were spending before so, taking a page out of our long, storied history in the world of mcdonald's, we've all always been a leader in value. and sometimes as a franchisee, like myself, you have got to invest in margin so we're going to do that precisely this summer with the launch of not only the $5 meal deal, but a revamping of the national value platform. there are many, many franchisees across the country in their local advertising co-ops that have executed value in terms of beverage, in terms of the food-led value and the national value communication piece has gotten a little away from us, as late and so we collectively as a group of mcdonald's franchisees and the brand have decided to come together and launch a very substantiative, impactful inflation-busting value campaign that launches again in literally

about four weeks the margin pressure is extraordinary. it's not just wage we're talking about massive insurance costs that have gone up in the state of california, if you can get it. government regulations that sometimes choke the lifeblood and oxygen out of small business entrepreneurship obviously, backdoor costs have skyrocketed. milk, eggs, the cost of beef, chicken, but all of those things combined, i can either just lament the impact to the cost of doing business, or i can get aggressive about growing market share, growing my business that entrepreneur zest, that drive is what i intend to do with my fellow franchisees in california, to fight this horrible legislation and the impact that it's had on our business and our margins >> scott, it's just a really interesting perspective. this has been colored as something that's pretty -- a big fight between the franchisees, but it sounds like you were behind it 100% >> well, you know, mcdonald's is

a big family and it has been around for 60 years. it's been -- it's prided itself, its success on this three-legged stool between suppliers, the brand, and of course the vital franchisees. and so in every big family, you have disagreements, but this debate, this internal debate has yielded a great result for the brand. and that is us being in the forefront of value by the way, value is not just about price. it's also -- it's a combination of price plus experience and so we're doing everything we can on top of price to drive things like convenience and that means getting more aggressive in the digital channel you've seen over the last decade, how aggressive we've become in delivery and mobile order and pay. and so we're going to continue to evolve, and we're going to continue to be on the forefront against our competitor to grab market share whenever and however we can >> scott roderick, thank you very much for your time today, scott. >> thank you, becky.

it is just after 8:00 a.m. on the east coast and you're watching "squawk box" here on cnbc i'm becky quick along with andrew ross sorkin joe is off today among today's top stories, minneapolis fed president speaking to our colleagues in europe overnight that would be neel kashkari. he wants to see many more months of positive dplata before a rat cut. elon musk's ai start-up raising $6 million in a new round of funding, giving it a valuation of $24 billion the company says investors include andreessen horowitz and sequoia capital, which have also invested in open ai. meantime, proxy advisory firm glass lewis is urging shareholders to reject a $56 billion pay package for the ceo, elon musk. and apple shares are moving higher this morning. a research firm affiliated with the chinese government reported that iphone shipments were up 52% in april from a year ago we'll be tugalking to a analyst

about that in 20 minutes >> in the meantime, take a look at the futures dow jones off about 42 points. nasdaq up about 47 s&p 500 up about six points. i want to show you treasuries, as well. the ten-year note sitting at 4.473. the two-year at 4.933. i don't know if we have any energy markets to show people, wti, there's a fascinating piece in the "wall street journal" about exxon. i don't know if you saw the exxon/chevron story is pretty remarkable, because you really see sort of back and forth going on between them. and in fact, this fascinating coworker, mike werth, is calling the ceo of exxon, and everything seems fine, and all of a sudden he turns on him. >> you have to look at whether they can actually turn over this there was a huge question from the very beginning, for exxon to say, okay, we're not going tie setter our right to what has become the most valuable oil field out there. it's -- they'd be sued by shareholders s if they didn't d it >> it's so interesting that they

have the call, it seems all friendly, they don't mention it at all, and all of a sudden, a month later, they turn on him. let's go to mike santoli at the new york stock exchange, who's setting up the summer marks for us >> yeah, andrew, looking ahead to summer, from a relatively healthy spot in terms of the broad indexes, thorough some mixed messages below surface, and the future so forth reflects some of that dow weak, nasdaq strong. the market has narrowed out as bond yields have gone up but we've more than recovered that 5% pullback we had back in april. there are some out there who says, okay, this looks maybe like a trading range between $5,000, $5,300 on the s&p. we've had investor sentiment get a little bit optimistic. but still in pretty good shape look back to last summer this is the end of may through the end of july. you actually had some strength in fact, there is some historic precedent for that take a look at how the market has tendedto perform from the beginning of may through the end of july. now, this middle line, the orange line. that's all years okay, you can see some modest

upside when the market has already been in an uptrend, which is the case right now, it has been considerably stronger, and in a down trend, you have those trends more or less accentuated during the summer months there's some nuances here with election years, this is from strategas, though. so it suggests that all else being equal, there is a tendency to have a little bit of upward drift over the summer months but i mentioned the mixed messages take a look at some sector breakdowns here, within the market and you'll see, you know, industrials and tech, of course, very strong. this is on a six-month basis and they continue to show, sort of, the upside drive within the market and then you see consumer discretionary and transports kind of sagging a little bit that's been following the economic surprise index, showing some softness recently and some concerns about consumer skiiblig cyclicals. you have to monitor exactly how

the yield and interplay with record levels of forecast earnings that's the push/pull inside this market >> thank you, mike in the meantime, neel kashkari making headlines overnight. cnbc's europe's karen tso asking kashkari if he could rule out a rate hike. >> i don't think we should rule anything out at this point we are all committed to getting inflation all the way back down to our 2% target the most recent inflation print that we go on the cpi data was marginally better than the earlier prints for the first three months, but still not where we needed to get to. so it wasn't getting worse, but we just need to wait and see i think right now, we're in a good position, because the labor market remains strong in the u.s. so the luxury of being able to sit here until we gain confidence on where inflation is headed >> joining us now to take a deeper look at the markets, jason trennert is here what do you think? do you think a hike is even

possible here? >> firstly, i would say, i'm kind of happy that mr. kashkari is keeping some mystery into this process i feel very strongly that the fed is saying too much, and has said too much. i know there's a big interest in forward guidance, but when i started growing up in the business, it was like white sm smoke/black smoke type stuff it was better in my opinion. >> because they're wrong a lot of times and they have to backtrack? >> in my opinion, i don't think they're -- you said it more harshly than i would >> it's hard to predict things change >> of course and if you're telling everybody this >> i don't think they know any better than anyone else, really. they have a lot of -- they have 400 ph.ds there. they're very right, very model driven but by the same token -- it works when people have a lot of confidence that the fed knows more than other people forward guidance works the other way when people are not so sure that they know what's going on. >> so you think he's trying to give you a head fake >> no, i think he's trying to

keep them honest, which is good, because i think, you know, a lot of people have gotten the inflation thing wrong over the last couple of years not the least of which is the fed. and i think it shows some sort of humility on their part, which is good right now. my own opinion, i would do precisely what he's talking about, which is to keep rates exactly where they are and i wouldn't try to call -- i would call balls and strikes i wouldn't try to really anticipate what the data is going to be, because i think there are real -- i think there continues to be upward pressures on inflation, which are not going to go away anytime soon. >> and so, when you think about where we are come election time, dare i say, in this year that we're in, what do you think it looks like you think nothing happens in the year of 2024 >> having said all of this, that's one person on fmoc. my own opinion is that the fed wants to ease and i think are likely going to ease i think jay powell wants to ease

so i think it's likely that we'll get an easing in september. i'm not so sure that's going to be right answer, that's my own opinion, because i think there are structural reasons why inflation is going to stay higher longer. there is an enormous historical precedent that says that once you have one wave of inflation over 6%, you get a second wave chances are about 9 to 10 that that happens it's largely because of the way contracts are written and wages tend to lag. so i would try to tap the brakes if i were the fed. but who am i -- i'm just a market guy, but i'm interested in the system, and i would like to -- >> why september at this point >> i think -- >> we've always said, once you get to september, it gets harder to do this >> it's true the only thing i would say, andrew, i don't think the data will improve enough between now and the next -- i'm not sure -- to we have two more meetings maybe one more meeting >> at least one more -- >> data memory to get better for them to think about it and i think the next meeting

after this is the day after the election you take politics completely out of it, which is probably not the worst thing, either. that wouldn't be, in my opinion, that would probably be ideal i don't think there's any rush, though because i'm not sure the chances of deflation are particularly high, which is to say, like, i think the cost of going too early are greater than the costs of going too late at this stage. >> why do you think -- there was a study over the weekend that showed that more americans think that we are in a recession than -- and we're not in a recession, but they think we're in a recession why do you think that is >> one of the things, this is a little plug for one of the -- some of the work that we've been doing. but we've created a common man cpi. and what we do is go the opposite of core we just included things tlhat ar truly core, like eating, staying warm food, energy, insurance, and utilities. and that has grown much faster

than wages it's the cumulative effect of inflation that people are responding to. >> i don't disagree with you, but when people say the word "recession" and they think they're in recession, is that a function of misinformation, that they're reeding and watching the wrong things is that a function -- is it that they are saying to themselves, i feel like i'm in a recession >> i think the -- >> it doesn't feel like -- >> we're not -- by any standard, we're not close to a recession >> it's shocking to me that so many americans think that. >> the fed has largely outlawed recessions and so, most people are not familiar with the term they're not familiar that really recessions -- >> there's an argument about what a recession even is we have been saying for a while that there are markets of the economy that are in recession. if you look at commercial real estate, other areas, where they see those things >> i think if you're an average guy, yourself worse off than you were three years ago i think your spending power is

significantly worse than it was. and to you, you could define that as a recession. a real recession is when you lose your job -- >> a recession is when your neighbor loses your job, a depression is when you lose your job. >> i'm not sure it's misinformation i just think that people have become so unfamiliar with the terms that they're not slicing and dicing the terms smemanti semantically >> it makes a lot of sense, but trend line in terms of where we are today is in a much better place. and truth is, most of the people who are watching this broadcast, you included and everybody else, have actually done shockingly well outrageously well. and i would bet you, if you quiz those people on the recession question, you would still get the same answer. >> maybe but as far as the election is concerned, that's the problem. wealthy people have done enormously well. t it's been very good for rich people, but terrible for the

average guy. i feel very strongly about that. and that's what people are responding to. and that's why you're seeing populism in our politics that i don't think is going to be erased anytime soon >> thank you. >> thank you, sir. when we come back, the first-ever legislation on digital assets recently passed in the house but the future of the bill remains unclear on the senate floor. the house chair of the digital assets subcommittee, french hill, will join us next. "squawk box" will be right back. we're still going for that nice catch. we're still going for that perfect pizza. and with higher stroke risk from afib not caused by a heart valve problem,... ...we're going for a better treatment than warfarin. eliquis. eliquis reduces stroke risk. and has less major bleeding. over 97% of eliquis patients did not experience a stroke. don't stop taking eliquis without talking to your doctor as this may increase your risk of stroke.

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welcome back to "squawk box. the first-ever digital assets legislation has passed in the house of representatives, with the future of the bill remiainig unclear. there's no timing on when the senate needs to act. joining us right now to talk about what comes next, congressman frank shilz is one

of the authors of "fit 21 ". good morning to you. so there's no timing on this at all? what's going to happen >> andrew, good to be with you look, for the last couple of years, we've worked on bicameral and bipartisan basis on bills that would enhance our digital assets' ecosystem. one on payment stable coins legislation that patrick mchenry and maxine waters has worked on, and fit 21, that we passed last week, overwhelmingly, 279 yes votes, including 71 democrats. and that sends a major signal to the senate that we have bipartisan support and that should incent senators lummis and gillibrand, stabenow and bozeman, four members that have worked extensively on understanding this topic, to collaborate with us on a bicameral partnership to pass this bill. >> where do you stand on this, i don't know how much you've been focused on this either etf, but

in the investment world, that has become the game, at least over the last month, in terms of when that will happen, what the s.e.c. is going to do. do you have a position on it >> well, i'm supportive of the s.e.c. going through the same process they did when they looked at underb both chairman clayton and gensler approving a bitcoin etp. they're following that same process. they had a setback in federal court that i think sped up their analysis and they determined that the cash markets and futures market seemed to be in a good correlation. i think that will enhance the assessment of either and put it on slightly a shorter time frame than we saw in the bitcoin process. >> i don't know if you saw former president trump making some comments at a rally recently, saying that he's going to -- you know, if you're in the crypto -- if you like crypto, i'm going to protect your crypto we're going to make crypto work for you. what did you think of that >> well, i'm glad to see

president trump's innovation in the united states. we want the u.s. to be a leader in financial technology, just like we have in other forms of technology, particularly as we look at the future of the internet, web 3 and block chain. he also said that he was not supportive of a u.s. central bank digital currency, which i think is a good position i prefer the private sector leading in payments, and that's why we're still working on a payment stable coin bill, that would let the private sector here lead in that matter on a dollar-backed payment stable coin >> it's interesting just to see even former president trump change gears onthis, because h was a skeptic originally were you a skeptic originally too? >> well, i've always said that i think blockchain has tremendous amount to take out frictional costs and financial services and other forms of the economy and i think that the concept of a tokenized payment through a

payment stable coin makes sense inside certain applications on a block chain, that doesn't make me per se, someone that would think that bitcoin is a store of value, not making that argument, but i am arguing that the u.s. needs to right regulatory framework for digital assets, so venture capitalists and consumers can feel like they have the right regime for innovation in the future of block chain and web 3 innovation >> what do you think of tether that is obviously the one that's unregulated. it's outside of the system people think that the way it works, the ui, everything about it is better >> well, i think tether is outside the u.s., as you say, british virgin islands it is dollar based i think it demonstrates the attractiveness of a dollar-backed token payment stable coin. the question is, what are the rules? what's the regulatory framework? what's the compliance with international law and u.s. law as it relates to anti-money

laundering and bank secrecy act? and that's why if we pass a dollar-backed stable coin legislation in this country, with our regulatory regime, our rule of law, combined with what we past last week, fit 21, i think you'll see a stable dollar-backed stable coin that's not dependent on some jurisdiction outside of the united states. >> congressman, we want to thank you for joining us this morning. we'll see where this goes and follow your progress >> you bet, andrew good to be with you. >> great to see you. when we come back, the box office is in a bad way after this past weekend. we have the latest big-budget movie and the mad max saga struggling to beat the latest an matdgarfield plus, apple shares higher on a report about iphone sales in china. we will talk tano analyst next. "squawk box" will be right ban

energy fuels, a leading american uranium producer, is ramping up production to supply expanding nuclear markets

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. eli lilly plans to spend $5.3 billion to boost manufacturing capacity for its popular antiobesity drug zepbound and related diabetes drug, mounjaro it's expanding a production site that's under construction in lebanon, indiana, raising its funding commitment for that facility to $9 billion in total. and you can see, eli lilly shares this morning up by about 0.4%, but year-to-date, stthat stock is up almost 40% apple shares are higher this morning too on a report that says china iphone shipments were up 52% in april compared to last year joining us right now is tom forth, senior consumer internet analyst at maxim group this is a pretty big swing, just in terms of what we've seen in apple sales in china there was big concern about what happened in the first quarter with apple sales, when they reported their earnings, it showed that sales there were

down by about 8% i think that's probably what had people so concerned about seeing these numbers and maybe the turnaround what do you think happened here? >> i think you're seeing improving trends in china for apple, and they're heavily expected to start discounting the iphone in china in the month of may, so it's possible that favorable trends will continue through the june quarter but i think that, you know, the improving trends in china and the strong iphone sales are two very important things for apple, more than half of their revenue still comes from iphones and a high teens pres percent of their sales come from china. this is a good data point for apple and for apple shares >> i think that's part of the question, though if they've started with these deep counts. i've read in some cases, discounts of up to $315 to offer people in. what do you think that did to margins? >> if you look at the margin story. the overriding benefit they've been getting is from an sea

breeze increase in sales and service. and when you think about management's comments in the june quarter, where they projected strong double digit services growth, it suggests to me that margins may held up, even with the incremental discounting in china to drive the iphone sales >> that's pretty huge, because there had been a big question about whether it was the political winds, the change, that had really push this. that it was going to be not okay or people didn't look at apple the same way that they had in the past in china. do you think that that -- that this would show that, okay, you know, apple is still a very popular brand, if the price is right? >> yeah. so apple is clearly still a popular brand. so the question, though, then becomes for the stock, we have a rating isn't the stock, and you're looking at about a 25 p\ for a company that's expected to have topline growth, essentially flat on a go-forward basis so a good data point for iphone and for china, but i don't think this necessarily changes the

story for the stock with a big p\e and a low rate of growth, and still a heavy reliance on both china and iphone, which i think will be a challenge going forward. >> what would be enough to change your mind >> well, either to have it more priced into the stock, so the stock now trading at 25 times p\e with flat growth, or for more information on their ai strategy, that would get me excited. right now, i don't think there's much to get excited there. or something successful on a new product line a division got off to weak start in the march quarter we'll see if the june quarter is any better there something that suggests a higher rate of growth than flat on a go-forward basis for a 25 p\e stock. >> we are expecting some insight into their ai plan this summer, at the developer's conference. what would it tyke actually make you think, okay, this is -- there's some "there" there >> something that would convince me that the ai story is going to drive smartphone sales so i think when you looked t

nvidia's performance last week, they talked about strengthening ai beyond the cloud service providers, i would like to see something that suggests that ai is going to drive smartphone sales, especially for apple, so looking for anything in that regard >> tom, thanks for your time today. >> meantime, the summer box office out of to a shaky start with growing concerns about the rest of the season julia boorstin joins us with more, julia. good morning >> it was a record low for memorial day box office. the holiday weekend had its lowest total growth since 1995, excluding those covid years. the film that topped the box office barely beat out sony's garfield, and brought in just $32 million over the weekend that's down from the $118 million that disney's live action "little mermaid" grossed last memorial day weekend. that puts the total four-day weekend down 22% from last year.

now studios are suffering from the fact that last year's strikes delayed major franchises set for this summer, including paramount's eighth mission impossible sequel including disney's lion king prequel, and there hasn't been the typical marvel movie at the start of may to kick off a strong summer. not a single movie this will year has opened with $100 million over the course of a weekend, which was fairly common pre-pandemic all of this puts more pressure on disney, which typically rules the summer and fell short last year ceo bob iger vowing to turn around the company's studio, and disney has two big surprises coming up. "inside out 2" in mid-june and "d "deadpool in wolverine" last july and "despicable me 4" and "twisters" out in july there's no phenomenon like last year's "barbenheimer," but

that's what they're all hoping for. >> how much of it is a trend situation versus an idiosyncratic, people want to go watch a is specific film meaning, if somehow there was a massive movie this past weekend, would that have led to more movie going more broadly, or do you think at this point, people just -- like, i just saw "the fall guy" over the weekend, but i didn't see it in the theaters, i waited and i just wonder whether the whole idea of this trend line in the theater makes sense anymore. >> well, i think it's a little bit of a nchicken and egg situation. the fact they watched "fall guy" in theaters a couple of weeks, you waited because you knew you could watch it pretty quickly at home, it's something people are saying, is this something i want to go out and see in a theater, or something that i'll wait and watch at home? there is something about going to the movie theater that encourages people to come back to the movie theater part of that is about the trailers, part of that is that a lot of theaters have gotten upgrades, they're a great

experience people go back and say, this is really fun i want to keep going to the movies that's a little bit of what happened with "barbenheimer," these films fed upon themselves. so what's that big movie that gets people into theaters and they say, hey, this is fun, i should keep coming back like they did last summer >> amc stock up not on the back of any blockbusters at the theaters, but on the back of them selling shares late last week julia, thank you >> thanks. when we come back, we're going to talk about the long weekend for elon musk, deep-pocket investors stepping up to buy into musk's ai, lifting the valuation to $24 billion. we'll get into the latest package drama as wl.el that pay package drama and where things stand "squawk box" returns after this.

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nc elon musk's ai start-up raises $6 billion. the latest on this and the musk pay package drama is tim higgins, "the wall street journal" business columnist. tim, what do you think here? clearly some demand for x-ai

>> absolutely. just a few months ago, "the wall street journal" and others were reporting a lot less money was being raised just showing that there's this huge enthusiasm among some investors to be part of that elon musk magic, right the concern, i think, for some out there in the elon world, is if you were a tesla investor, what does this mean for elon musk's ai ambitions? his broader ambitions. you have x-ai, a separate company, tesla, a publicly traded company, all under the elon musk umbrella >> i guess that would depend on how much of the ai brain power was powering the valuation in tesla right now. >> absolutely. the broader question, i think, tesla investors are kind of grappling with right now is, where is elon musk' ambition for ai for so many years, he was selling tesla as the idea of this ai company. it was going to usher in

autonomous vehicles, have human audiohu humanoid robots. where is the ai future that elon musk is projecting, is envisioning, and which company will benefit from his vision >> it's interesting, tim you tie that back to this pay package. over the weekend, we had glass lewis saying that shareholders shouldn't vote to reinstate his pay package that the declare court struck down. but you bring up the very wise point that this valuation, x-ai's story is more closely tied to that than you might realize. if he doesn't get that pay package, it probably worries tesla shareholders that he's even more likely to spend less time with tesla and focus far more on x-ai and the other things he cares about, like spacex >> the pay package was originally done in 2018. and the board at tesla was really concerned or really wanted to ensure they were getting a fully engaged ceo at

tesla. that elon's big game was being brought at this company. now the question is, is he fully engaged? the board would argue, hey, thad a deal, they should pay out that deal, but some investors are clearly seeing this as a referendum on, hey, is elon fully engaged at tesla even elon musk has suggested that if he doesn't get 25% control of tesla, he would be worried about doing ai and robotics at the company, and that's worrisome some investors see that as a signal that he's in some ways suggesting that he might take that technology elsewhere or those big ideas elsewhere, and tesla would lose out on them >> but tesla without elon musk is kind of hard to comprehend. >> absolutely. there's clearly a premium in that stock, because of elon, he and the company are a lot of ways intertwined as a brand, but the other question kind of arises, can elon go without tesla? it is such a huge part of his

fortune, his personal fortune. so much is tied up in that stock price for him personally and for his other companies. so it's almost a game of chicken here >> let me ask you a different question, as it relates to the ai piece of this, tim. one of the things that's clearly going to become the most valuable component, i imagine welcome of the next generation ai will be the data stream and what he has argued repeatedly is that tesla is in this unique position, because they have cameras on all of these cars and they have, basically, a direct feed that is very different and puts them at a great advantage to everybody else he believes this is not only true of the vehicles, but ultimately, would also be true of his ability to create robots. and so, if there's that piece of this, where's the -- where does x-ai fit into that or not? >> i think that is the big question, right? investors in x-ai, according to my colleagues at "the journal" here, have reported that some of

them were excited about getting into x-ai, because of elon's other companies. the data that comes out of "x," potentially the data that comes out of tesla and how it could feed those models. but if you're a tesla investor, you want to know, where's the benefit for them elon has been talking about for so many years, as you just pointed out, that that data off of that car is hugely valuable for its potential in ai. and it gets back to this kind of core question of where do tesla investors fit into the broader picture of elon's, all of his companies, especially he's kind of pursuing an ai future outside of tesla >> that's the other question do you think the board of -- look, there are some people who are planning to vote against some of the board members this year i think as a bit of a show of, you know, you know, a show of frustration, to say, hey, guys, you know what, you've got to somehow manage this in a different way. do you see that changing put the pay package piece aside,

could you ever see a moment where the board says, look, we can't do 20 other things you want to do x-ai, do it inside this company. if you want to do x-ai, we own half of it >> you're hitting on some frustration that you're definitely seeing from tesla investors here, that the board seems to be willing and has shown this long history of really trying to make elon happy, as long as possible, right? in some ways, the board has an obligation, if they think that elon is providing this huge value for tesla, they want to protect that valuation, right? but the other question is, you know, how much do they have to do to kind of get him to be engaged? you know, how much do they have to convince him to work at this company that, in a lot of ways -- and he's even said, is his family you know, what needs to be done to get him to kind of buckle down and make tesla a priority >> hey, tim, great to see you this morning tim higgins. >> always. >> wonderful to see you. >> when we come back, a key

state looking to raise taxes on sports gambling, and that has two names sliding this morning we'll tell you about them after this and two months after the baltimore bridge collapse, the estimated losses is in the billions we'll get into the impact on the insurance industry, thhewi t chairman of lloyd's, when "squawk box" returns off the comcast business van. into the vending area. oh, not the fries! where's the ball? -anybody see it? oh wait, there it is! -back into play and... aw no, it's in the water. wait a minute... -alligator. are you kidding me? you got to be kidding me. rolling towards the cup, and it's in the hole! what an impossible shot brought to you by comcast business. (grunting) at morgan stanley, old school hard work meets bold new thinking. (laughter) at 88 years old, we still see the world with the wonder of new eyes,

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welcome back to "squawk box. news in the world of sports betting. y illinois lawmakers are drafting a new budget that includes an increase in the sports betting operations contessa brewer joins us with the latest on that good morning >> rough reaction there, andrew. fan duel and draft kings are feeling the pressure as illinois senators approved a 2025 budget that includes raising the states' sports betting tax sports betting operators in illinois have paid a 15% tax since sports betting went live in june of 2021. the budget proposes to increase that tax rate to 40% so a hefty tax rate hike, which

would make illinois the maximum tax rate, the second highest behind new york, which is 51%. by the way, new hampshire is also 51%, but draft kings has the monopoly there illinois is the fourth largest state for sports betting revenue and betters there wagered more than $1.2 million on sports in march alone. in 2023, illinois state operators took in more than $1 billion in revenue so the sports betting alliance, a coalition of leading sports betters, called this proposal extremely disappointing decision that will cause real harm. the bill now heads to the house and then will go to the governor, j.b. pritzker, should that happen and pass the interesting thing, i think, if you want to look at this in perspective is that these legal operators, who are paying taxes in every state, guys, what they say is they're having to compete by all the money it takes to get licensing the state to compliance, and then in taxes. they're having to compete with

offshore operators who don't do any of that. and so that makes the hurdle, the competitive hurdle real and significant. and they think it will cause business to go down. >> okay. contessa brewer, thank you appreciate it. >> mm-hmm. it's been two months since the collapse of the frances scott key bridge in baltimore. estimated insured losses from the tragedy could end up being about $3 billion if that's the case, it would make it the largest marine insurance loss ever recorded, with property, marine, aviation, transit insurance premiums likely impacted. for more on the far-reaching effects of this incident in the insurance world, we want to bring in bruce carnegie brown, the chairman of the latest insurance and re-insurance company, lloyds. >> thank you for having me >> we know those early estimates of $3 billion is what was being kind of eyeballed at that point. i know it's still a long way for all of this to be completely investigated and found through,

but does that sound like an appropriate level to you, around $3 billion >> that feels right. i think the physical damage amounts are reasonably easy to calibrate, the bridge, the ship. the developing claims are all around business interruption for the cargoes trapped in baltimore port that have been slow to emerge and i think they were originally planning that the port would be fully reopened by the end of may, and i don't think that's going to happen. so further claims will develop, but i think $3 billion is a pretty good approximation. >> to put that in context, $3 billion is hard to get your head around, but that's more than even superstorm sandy caused in terms of maritime insurance losses >> i think that's right. but in the scale overall losses from hurricanes, this is still quite small. hurricane ian, i think, going through florida last year had insured losses of about $50 billion u.s. so this is very much manageable for the insurance industry and the good news for our customers is almost all aspects of the

disaster are insured >> yeah. is this something -- it feels like it's gone smoothly from the insurance perspective at this point. will it mean big losses for insurers and re-insurers >> it will be a very large loss. our estimate is somewhere between $600 and $900 million net. it will take a little bit of time for the liabilities to crystallize, because there's got to be an increasing who's responsible. but i'm pretty confident that in aggregate, more than $3 billion will be paid out >> the history of lloyd's is kind of amazing. it goes back to a coffeehouse that was there when the ships would come in, and this was trade, global trade at the time. it had to be managed somehow it had to be insured somehow >> it started as an exchange of data in the coffee house, and people trying to lay off the costs of their cargoes and shipping as it moved around the world. from there, the market developed, it got proper lin corporated in the 18th century

so, yes, nearly 325 years podium >> and how are things going right now in the insurance industry we know, writ large, when you look at insurance, it's a better scenario when you're dealing with higher rates instead of zero interest rates, because you can offset potential losses in the future with gains that you're making in the markets right now. how does the market right now how does that work >> the real off sheet is both sides of the balance sheet are working in 15 years. all the money for claims is earning us a return. liabilities are going up because of inflation really the interest rates you earn on the time deposits and the bond portfolios really offset some of the inflation we're seeing in claims underlying prices have been improving across the market for a reasonable period of time now, getting back to more sustainable levels from an underwriter's perspective, it's actually a good time in the market. >> you can write policies. you've had the situation where state regulators and authorities are saying, okay, it's okay to

raise rates to recoup some of the losses you were making in inflation? >> we don't play in the market where the legislators intervene. we can choose our own pricing and what we're finding is that pricing is looking pretty competitive. we continue to be the leading provider to u.s. customers. >> what's it look like in florida right now? i saw a report last week about how hurricane season is expected to be the highest risk, the most number of hurricanes that we've seen because the water temperatures are already so warm what do you think as an insurer or reinsurer >> the conversation we have with governments at the state and federal level in this country but also internationally are very much around trying to build more resilience into the economy. insurance really only works when it's protecting against unexpected outcomes. if it's expected, the premium outweighs the claim and the

model breaks down. this is persuading people to be more careful about zoning. florida has been benefiting from inward migration from the rest of the united states for more than 40 years. it tends to be more affluent people that move there with expensive assets and they all want to live on the coast. >> how are you measuring the impacts of climate change or the impacts of water warming when you're making -- when you're writing these policies today we've been talking about it on the air, but i spent the weekend talking to people, talking about turbulence in the air. you see the deaths happening in the air. you want to say they're fluke incidents, but they're now happening with -- there's some trend line here. how do you change your policies as a function of it? >> general insurance reprices annually you have a chance to look at the terms and pricing of your policies on an annual basis. that looks well if you're looking at things moving in a linear direction, adding another year of data to a long data set.

the good news about thatis insurance pricing shouldn't be too volatile if something exponential is happening in terms of a change potentially impacted by climate, we're always going to be behind -- >> what's the house position on there? is there a view it's going to ramp this way, is it just a line we used to have this conversation with warren buffett. for a long time he used to say climate isn't impacting things. >> you better be careful of drawing conclusions from weather pat tense. we have about 25 mrs of our capital tied up in natural catastrophe around the world we're certainly observing greater frequency and severity in those claims. >> is it because more expensive properties in these zones or storms are actually worse? >> we think it's because the storms are worse the frequency and severity of these storms is growing. you look at the weekend.

you had tornadoes going through the southeastern united states that's become a thing here and it didn't used to be. >> there was a story last week, i can't remember if it was "the new york times" or the "wall street journal," where they talked about how homeowners and farmers in the middle of the country couldn't get insurance anymore. they're being treated the same way that florida homeowners used to be treated. that make sense from your perspective? because the catastrophe is much more highly likely >> i think that's right. exactly the point about building greater resilience into the economy which is about better building standards, where you build, the mitigations you can have in terms of early warning systems on these storms arising. we're still providing these covers, but at some point they become either unaffordable or unavailable unless we take decisions on changing behaviors. >> thank you very much for joining us today >> thank you for having me up next, the early morning movers as we get ready for the oping llenbe on wall street of

the holiday-shortened week "squawk box" will be right back. i can't believe you corporate types are still calling each other rock stars. you're a rock star. we're all rock stars. oooo look look at my data driven insights, i'm a rock star. great job putting finance and hr on one platform with workday. thank you! guys, can you keep it down. i'm working. you people are (guitar noises). hand over the air guitar. i've got another one.

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welcome back to "squawk box. dom chu joining us >> let's check out what's going on apple shares up 1.5% premarket, this on news out of china that foreign-made smart phone shipments surged in the month of april by 52% apple was president mentioned specifically by name, but it is by far the biggest seller of iphones, foreign-based smart phone seller in china. we're also watching what's happening with nvidia shares which are up about 3%. helped in part by the xai funding announcement, about $6 million raised by elon musk. much of that the expectation is to be spent on individual-based chips for the ai systems those shares are up 3% capping off with a check on the

meme stocks. they are back. this after gamestop announced it raised $933 million in funding by sharing 34 million shares gamestop up 22%. amc up 4.5%. other smaller memes not up by nearly as much as gamestop i'll send things backs over to you guys. >> dom, it's been something to watch, the meme stocks think they're back for good sdm. >> i'm not sure if they're back for good by the way, well off at $23 per share. we're talking in the 60s for gamestop by the time the middle of the month came around it's interesting that share sale head luns are what drives the upside in these markets, the fact there's a dilutive effect, not really factoring into the meme stock craze fundamentals, still a question about whether they play into the meme stocks. you never know what these guys are thinking

the messaging boards, reddit and everything else. let's take a final check on the markets before we hand things over to "squawk on the street." the nasdaq closing at an all-time high on friday, it and the s&p 500 looking at five weeks of a winning streak. the dow was down last week by 2 1/3% we'll see you back here tomorrow right now it's time for "squawk on the street. ♪ good tuesday morning welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber is back at post nine of the new york stock exchange holiday shortened week apple and nvidia up 2 to 3%. nasdaq looking for a sixth weekly game. pce ornl on friday kashkari telling cnbc he's in no rush to cut rates saying he needs many more months o