and "squawk box" begins right now. ♪ good morning, everybody. welcome to "squawk box" right here on cnbc. we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin, and the markets, as least the s&p and the nasdaq sitting at new highs once again. seems like a broken record. seems like we're saying that every day. it seems like things are holding steady, a little bit of a positive twist to this. dow up by 21 points this is all happening as we await the cpi data. this comes after 21 point for the dow. apple helped. again, they closed at

record-highs. you had apple shares surging to an all-time high after announce management of the company's artificial intelligence strategy that they call apple intelligence. the last trade is at 206. you're looking at the ten-year sitting at 4.4%. the 2-year at 4.83%, anded by coin which was under pressure remaining below 68,000 this morning, 68,764. new this morning the international energy agency warning oil production is expected to outstrip the demand growth by the end of the decade. the iea issuing a big warning to oil companies making sure their business strategies are prepared for a surplus.

we've been watching wti. this morning it's at $73.83 a barrel. oil prices come down. >> 78 doesn't sound too bad. world's smallest violin for opec. >> that and the big warnings. they have been diversifying to some extent already. in the meantime, the fed in focus. we're going to get picpi at 8:3. that data is going to be followed by the latest interest rate announcement. we'll get that at 2:00 p.m. no rate move expected, but they plan to be focused on the dot blot and how many will show. later today the white house

hosting a virtual press briefing. ahead of that, we'll speak with transportation secretary pete buttigieg, and that's coming up in the next half hour. >> i don't know if it's surp surprising. national amunsment had previously agreed to economic terms of the merge, and had been awaiting sign-off from shari redstone, the owner. in a statement they said they would not be able to accept the terms. redstone company said it supports the play. this is as well as the ongoing work to draw value creation chlgts we'll be talking with rich greenfield. he'll join us in the 8:00 hour.

earnings and revenue are coming in slightly below expectations, but the company announced cloud dealing with going md and ai. the deal with openai will extend infrastructures and its partner microsoft du jour ai. you cosee that stock up by 8.5%. we had a flurry. we should call this the elon musk flurry. it'ses he news. we should get the verdict, if you will, of the outcome tomorrow night. late last night "the wall street journal" publishing a piece with musk and women in spacex. several female employees say

musk showed them an unusual amount of attention or but sued them. a high-level group fails to comply with his rules. this proves the denied allegationsof sexual harass management. i thought there was one woman mentioned in the report who denied it earlier. nonetheless, it's all very complicated. we talked about that lawsuit for many a we're, several months ago. he sued altman for breach of contract. overnight musk posting on x he would have much more to say on this later. >> do you understand why he did it? was it just in case they weren't going to win? >> i think -- i always thought -- why he with drew?

>> yeah. >> in many cases, i don't know if he won, but he put out into the public discourse the ideas that he wanted to explore. i don't think he ever thought he would get a settlement. >> it was weird to see it withdrawn. it may have been a tough case. i kind of understand why he would get mad over. in other news tesla owner has sued him to return billions. the diplomat retirement of rhode island holding $20 billion. they sold the combined $30 billion in tesla stock in 20 20

cashing in before it would fall and become public. i think we're going to be talking about that one for a while. separately elon musk confirming separately. he said it's important to allow people to leak posts insterile of getting atamg to do so. people were feeling discouraged. users will still be able to see who liked their post but won't be able to see who likes another user's post. i like this. >> you do? that's the only reason to like something is to let them know you're liking it. >> i don't have to retreat it or respond to it and say yes.

why do it otherwise, just to let them know that they're on the right track? > they could take a picture of your like. >> they could. but hopefully they wouldn't dpz. >> when you're retweeteding something totally off the wall -- >> by experience? people can say, you're sleeping with flees. arc is going to release a new long-term tesla price tar get today. they teased, reporting alaska's expected value for 20209, and

right hay thp thought. >> turning to apple, 7 7 move on a 3 trls stock. you gain more than most companies, and you also can't count out apple. every time there's a pullback and you think apple's nomtd going to be a -- 3.1 t$3.1 tril. i think people are like anything that could help siri. just a slight improvement of what she comes up with sometimes. >> i think part of it is you're

going to be able to offer all of these things anyway. if it's multiple large language models that you can office this. apple's probably got the best idea and their marketing is second to none. who came up with that name? >> apple? >> i think that's a question mark when the large language models are a b2b. >> it might be -- it could be commodi commoditized. >> by the way, if that's right, apple is right. if it can be a productivity

booster and get people to buy the phones and upgrade their cycles more frequently again -- >> would that cause a 1990-type reckoning, if that's at it is? >> no, because you'll still need the chips. >> back then you had 100 krautzy companies in it. >> you still need the chips. >> this is supposed to be exponentially more important than the internet, all it's going to do is with a better acie taens. >> right now when e do something wrong, siri comes up, and i don't want her. how you do get of it. >> the.

you can know who you want to' a phone cass, who you don't. hard to understand when you're writing an email, its shows what you really meechblt i'm always texting saying, sorry, siri. >> there are different things out there that may do this. >> my texts have to be green? i'm not doing that. >> you can reply with any emoji. >>. >> will they be blue? >> on your yeel phone frmg question. .

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so you don't have to compromise. powering smarter savings. powering possibilities. welcome back, everybody. markets are awaiting the key cpi report due later this morning. consumer inflation is expected to show a slight increase on a monthly basis and a rise of 3.4%

on an annual basis. that would be similar to the increase we saw in april. for more on that and today's fed decision, we want to bring in ian shepherdson. he's chief economist at pantheon. you expect things to be in lein at 3.6%. what do you expect? >> what we learned over the last couple of years is these numbers can show up surprises. so if a core reading shows up a 0.4 instead of 0.3, markets will be unhappy. the fed chairman powell will have to explain things. i have never ruled it out. there's a lot of stuff ahead of the number we just don't know. there's a sort of black box we have to guess at. it has miss behaved over the

last couple of years and you have to be a bit careful. >> even if it's in line on an annualized basis, 3.3% is higher. they want to see 3%. how would that go toward cutting rates? >> it's about a couple of things, it's about direction and that it will remain on a downward track. it's bumpy. we can't expect it to get better every month. but as long as they believe the causes that caused inflation to go away, they'll eventually get through to the numbers that matter, and the fed have to be aware of the dangers. if they wait until inflation gets back to the target and they wait. they'll have left it too late. if you wait until you're absolutely certain, then by definition you're too late because policy takes too long. so they need to make a judgment about whether the trajectory is

good enough even if you're not of the destination you want to be at. >> if you're wrong, it cuts in and it turns out, oh, my gosh, we shouldn't have done that. the path of least resistance is to do nothing. >> of course. they're very cognizant of it when they thought the inflation spike would be brief and it wasn't and that proved to be disastrous. they have a collective reputation, market confidence was lost. they can't afford to be wrong again in the same cycle in the same direction. so this has made them a lot more cautious than previous fedding would have bun. they started to cut rates before inflation because they know what they've done by raising rates will bring it back down. >> why are you so convinced? when we look around, it looks like a lot of liquidity sloshing around. you look at markets hitting new highs. you look at things like bitcoin that have been above $70,000.

that's not successive of a super tight economy. >> cash flow has finally slowed. last year's cash flow for the consumer was enormous. it ran double the long-term pace, but this year things slowed down. the softness is probably the start of something sustained after a long run of upside surprises, but the important contrast, i think, is between those very big picture financial conditions you mentioned with the market's new highs. looking at the state of the small business sector which includes half of the work force, business owners are paying 9% for their short-term money. >> no argument that that is a real credit crunch, at least in areas of the economy. it's just that it hasn't spread everywhere yet. >> it hasn't, no.

>> we had bank of america on yesterday. it's being driven by younger people and cash on hachbltd cash balances stilwell above where we were before the pandemic. >> yeah. so i'm not suggesting the economy is rolling over. what i'm suggesting is the slow growth we saw in the first quarter is probably more representative of what we're be in the rest of the year. big surprises to the upside. an from the fed's perspective, that's a risk. the unemployment rate is creeping higher. the fed didn't think we'd get there until the end of the year. it's kind of a weird and unusual combination. they have to be aware of the risk that if they leave that on, then the rise in unemployment accelerates, and before you know where you are, you're heading thwart a rate of 5%.

that's too high. not this month, not this quarter, probably not this year, but next year, and because of the lags in monetary policy, next year is what they need to be thinking about now. barring some sort of external shock. next year in 2026 is when they need to get their hands on the policies. they need to be thinking about the future. >> when do you think they will cut? >> september, i hope. two or three more inflation reports. i'm expecting a big payroll number to be revised down. looking across the business surveys frmgts, the pmi, they all have employment measures. every one of them has weakened over the last few months. if they're right it will be weaker and powell will set something up at jackson hole where he can make a speech and that will happen in september.

i wud like them to do something today, but they won't. >> i think we all akbrie. >> disney proposed its plans for next month. details after the break. with gold and copper prices pushing towards all time highs, us gold corp.

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welcome back to "squawk

box." nelson peltz's trian amasses rentokil stake. they're looking to improve the value before it had a market cap of about $13.3 trillion. it's a top ten shareholder company. at least 3% of shares are outstanding. not as exciting a company. >> terminix, who knew that was nelson's next move. >> he goes from mice to ratss. >> that's correct. >> very clever. >> you do need -- you've dealt -- i -- >> i've dealt with mice. >> yeah, yeah, there's definitely -- bugs and stuff out in the burbs. bugs, mice. >> no roaches. i lived in new york city. that's the part i don't miss.

>> when i say joey chestnut, i feel kind of sick. he won't be heating hot dogs this fourth of juul. major league eating, who knew. the chestnut sponsorship deal with plant-based hot dog maker impossible foods disqualified him from the hot dog contest sponsored by nathan's. chestnut has won the contest 16 times. he said he was, in his terms, gutted to learn he was banned from the event and had been training, training, he trains to defend his title, major league eating and nathan's said they went to great lengths to work with him and his management team. they partnered with a new partnership. impossible foods told espn they support chestnut in any contest

he chooses and meat eaters shouldn't have to be exclusive to just one wiener, ding, when we talk about anthony weiner. et he will participate in an unbranded hot dog-eating contest on labor day that's slated to stream on netflix. we talked about it on camera. the logistics involved. none of it makes me -- i watch it. i tomato like it. i don't want to think about what happens afterward. got to go somewhere. either sticks his finger down his tlo his throat or he's on the toilet for 12 hours. >> thank you for the visual. >> watching what happened. they dip it in water. do you -- >> i used to watch. >> i ottawa all will i bet on it. >> so it's the winner of the

nathan's hot dog contest going to have asterisks next to their name? >> there's an over and and an under like 52 1/2. >> 52 1/2? >> something like that. he did go over. he has to break the record. >> i'm just thinking of the plate. >> what does it do to your stomach? it's the opposite of a lap band. it stretches out the stomach wall, does it not? >> i can't imagine there's -- >> i think there's a sponsorship opportunity for ozempic. he would be good for that, you know? >> not beno? >> pepcid actually does sponsor. coming up, a special report on planning for the future and what you may need if you require long-term care. and as we head to brang, here's a look at yesterday's s&p 500 winners and losers. >> wieners.

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good morning, everyone. welcome back to "squawk box." we're live from the market sight in times square. you're looking at the dow up by about 15 points, the s&p up by 6 points, the nasdaq up by 24 points, and we're awaiting that number, the cpi number that's going to hit in under two hours' time. it is estimated 70% of people turning 65 today will need long-term care in nair lifetime. now, how to pay for that care is an increasing worry for many americans and for all of us. sharon epperson is here on what we need to know. >> hey, joe, for people who require long-term care about about 20% of them will need it for five years or so.

the minimal costs for care for a private room in a nursing home is about $117,000 a year and is expected to rise to $157,000 in ten years or so. so for gen x and baby boomers, conversations now about how you'll afford care as you age are critical. she and her partner have been caring for their parents for several years. stacy's father passed away in april after being in an assisted living facility. while stacy coordinated his care, the bills were covered by his pensions and veterans benefits. >> it took about a year to actually get those benefits despite filing for them, and had we not had a tiny little bit of money in my father's savings, we would have been in trouble. >> reporter: sharon's mother has alzheimer's and recently moved into an assisted living facility. >> it's $8,000 a month.

she doesn't need skilled nursing. she just needs to be safe. >> their parents never had long-term care insurance. now shaper and stacy are considering buying coverage for themselves so they don't become a burden. >> we're both really aware that long-term care insurance would be a smart investment right now not just for us but for our kids. howard glecman, an expert on long-term care is that the problem is many firms mispriced these insurance policies years ago and lost money on them. the benefits aren't as generous and the rates are higher. >> people who need care for a long period of time, it's really expensive for them. >> the premium for a 55-year-old woman can range from $1,500 to $7,000 a year depending on the benefits. if she's healthy, the cost averaging $3,700 a year for an expected benefit of about $400,000 when she's 85. premiums are lower for men since

they're less likely to use it. >> these are like follow-ups. >> reporter: sharon's daughter, a financial adviser, is herring her moms consider options which could include life tell annuities or boosting their savings. still it's tough to talk about. >> nobody wants to have them, but better now than later. long-term care insurance policies may pay for care in a nursing home, assisting living facility, day care or care at home. they can vai widely depending on the coverage and the amount of the daily benefit. >> does everybody have a policy? what determines whether you get benefits? >> what determines whether you get benefits is really the severity of your cognitive impa impairment. also you have to have a waiting period sometimes up to 100 days before the benefitses will kick in. but most importantly, you have

to be unable to do two out of six of activities of daily hiving. you have to have care in terms of bactsing, dressing, getting off and on a toilet, getting in and out of the bed. there are six activitieses of daily living that they look at and they need to see you can't do two out of six of them. if you can do five out of six, then you probably will not get the benefit. >> 100 days just to make sure it's not just temporary? >> i mean, there's a waiting period for different types of insurance. in this case it could be 20 days, 100 days. >> what happens to the people -- they say it was mispriced or companies didn't anticipate the long-term care. are those people out of luck? did they go bankrupt? >> some of those places are no longer offering that kind of insurance going foords. they stopped writing the policy, but you're still able to get that from some of the insurers, yes, if you got it long ago.

>> that's a lot of money to commit to. >> it is a lot and i don't think people understand what the limitations were, that maybe it doesn't cover at-home care. some policies do, some don't. most importantly, it's thee activities of daily living. people may not seem like themselves, but if they can do it according to whatever the independent nursing firm who looks into it says that i can do, then you're not going to be able to get that policy, get that benefit. >> what's the average, you said, stay for long-term care? >> 20% of the people are going to need to be there like five years or more. >> that's amazing. >> the reason men don't use it as much is they die? >> yeah, yeah. they're less likely to claim the policy. >> thanks for all this, sharon. >> it's important to plan ahead for these things. that's the whole point of that, to know we're all going to age, who knows how we're going to do it, aed how are we going to pay for it, who is going to help us with it, where are we going to be. all of these things to think about. it doesn't mean you don't have

to have insurance, but you have to think about it so you're not putting that financial burden on others in your family or at least let them know they're going to be burdened. >> happy wednesday. >> happy wednesday. coming up, the rising popularity of stoicism, they're having a renaissance among executives. ryan holiday is one of the leaders of that movement. a great aauthor. he joins us next. follow squawk pod on your favorite podcast app and listen any time. we'll come right back. ing what .

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welcome back to "squawk box." the host of the daily stoic which applies stow i sichl to modern life. guests included on his show with matthew gladwell and matthew

mcconaughey and arnold schwarzenegger. here he is at our table, he's a best-selling author of multiple books. his new book "right thing, right now" is out right now, book number 16. that's a lot of books. are you a stoic? >> i try to be. >> can you describe it for the audience? >> my working definition is they focus on how they respond to what happens. cou courage, wisdom, justice, and responsibility. >> how much are you an author, how much are you a psychiatrist when you invite people on your podcasts? >> it's surreal. when i said i want to ride a book about ancient obscure philosophy, i didn't envision any of this. others have. it's been sur reerl to hear from military leaders and tech

leaders and athletes and actors that this thing from so long ago could have so much relevance particularly amongst elite performers. >> to you feel like you're leading a stoic life? >> i'm certainly not claiming to have mastered about these things. i'm writing them first and foremost to myself. i try to be stoic. i think i'm good at some stuff. >> what are you good at? >> the discipline thing comes to me easier than courage or justice. i think i'm reasonably intelligent. i'm always trying to learn. >> break the other pieces down, the justice piece and courage piece, what that even means. >> courage, discipline, justice u wisdom. courage is important, but in pursuit of what. wisdom is importanting but without the discipline, the strength to bring it into

reality, what can you do? these sort of interlocking virtues are what try to shape us as aspiring stoics. >> have you found -- you talk to athletes and ceos and all sorts of other people. to you find there's one type of winner, if you will, that's better at this? i would think theets would be because you have to go through pain and discipline and it sort of -- it's physical. >> what's fascinating is what they all share in common is at the elite level it comes down to the mental side of things. you go into the locker rooms, and what they're really thinking about is not the xs and 0s or how to come back stronger but how to deal with injuries, things not going your way, how to finding stress, peace and stillness inside the craziness. to me that's where the philosophy side of things comes in. that's what it was doing 2,000

years ago for a general or an emperor. >> we have a lot of ceos who watch the broadcast and they could use some of their help. you have folks who are struggling, on a day-to-day basis, trying to get through the day, is there any way to tell them how to be stoic? >> the biggest stoic is marcus, the most powerful man in the world. alsoest rah talsoest fra tee tease. how do we have command over our thoughts, opinions, ultimately stoicism is there. >> how much is having a mental attitude? >> people think of stoicism as depressing or resigned, but it's about focusing on what you control.

>> being optimistic to some extent that i can to this. >> when you look at the life of someone who has tragedy and pandemic and wars and floods and all of the disasters, that he got out of bed each monthing showed courage and hope. he did it early and realized his potential. this idea of a sad depressive -- >> do we have to meditate? >> marcus's work is meditations. he's not sitting there with his eyes closed. he's writing. journalists as a practice, how do you create some distance from your thoughts? how do you hold yourself -- >> i thought about doing the journaling thing, the artist way. >> quiet time in the morning. >> we don't have quiet time. >> you've got time. you've got quiet moments. we can imagine he was a pretty busy guy, but he's finding time

to scribble things down. >> his favorite philosopher was a slave? >> yeah. >> did he do anything to release the slafr? >> were the stoics perfect? >> no. it was not a time. >> i would rather be an emperor. >> it's a preferring indifference. would you rather be rich or poor, tall or short? you'd have some choice. >> stoicism has been a big topic for many of your books. what's the different tweens where you started in the process and where you are right now? >> like a lot of young men, i was interested in what it could do for me, how it could make me more productive, resilient, and in control of myself. justice is a central part of stoicism. what is stoicism asking of you?

as a citizen, human being, spouse, parent. we can't strip the ethical component out of it. if we think of stoics as being these powerful important people, the check that ultimately held them from doing whatever they wantedholiday, the book is called "right thing, right now," we appreciate you being here this morning. >> thank you for having me. when we come back, more on "squawk box." we're going to dig into apple's big jump yesterday. 7% gain translates to a $215 billion market cap. "squawk box" returns after this.

coming up, a closer look at apple's big move yesterday, and

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apple closing at a record in yesterday's session after the company unveiled its push into a.i. at its annual developers conference. joining us now, ramzi mohem, bank of securities senior i.t. harbor analyst. good to have you on. there was much anticipation. i think it could have gone, either way, it was seen that apple was lagging and what was the strategy going to be? somehow, players, market

participants, whomever, listened to what apple had to say and were really impressed with the strategy. >> yeah, joe. i was there at the developers conference a couple of days ago and it was really a very different event from the past events i've been to. it is different because usually the focus is here is ios, here is tv ios, watch ios and they talk about all the features. this time around, they segued into a.i. at the second half of it. the first half of it was the typical update and then they said, well, here's what apple intelligence is going to do on top of all these ios updates. and it was really different in a sense that you could see a palpable difference in the reaction of everyone saying, look, this is really interesting. two things that i think really jumped out. one is the fact that you need newer devices to upgrade. and use these features and the second thing i would say is that when you look at what apple is doing, they're saying, we're going to do this from a privacy

centric perspective, but also saying we're going to use the cloud to do it. i think the combination of those two things makes it very different for apple compared to the other companies trying to do this. >> the 230 price target, when did you -- you had that before this all happened? >> we did. we were actually -- we named apple a top pick in the mid-160s. that's the first time we called it a top pick. that was preearnings, pre this and we upgraded the stock earlier this year. our view has been that the markets really not looking at apple the right way when it comes to a.i. so, search was similar. you have companies that do a lot of capex investments and yet the modernization is done by engaging users with the technology. a.i. is sort. apple sits in this position where you have this massive install base of users, super attractive to every technology. so when it is app developers

that sit and build on all these different lans or on top of the app store, there is a modernization model by connecting the consumers to this technology. apple was a distribution business in some ways. not making the capex investments on the one hand to all these, but seeing the benefit of that and consumerization of that technology is what really apple is really good at and able to -- >> would you be upset and would you not like the stock as much if they actually were investing lots of money in a.i.? >> i would say that it would depend on, you know, what ultimately that strategy leads to, right? so, be we can talk about high capex investments and things like memory. memory is a commodity. will lems become a commodity? they could be. would you want apple to go and invest in memory? no. that would not be great. how do you monetize that ultimately? and if apple -- the thing about apple is a little different is that they're so good at vertical integration. when you take everything and line it up from hardware,

semiconductors, software, services, that makes a difference. so it really depends on -- >> what do you think they're going to be paying for the openai partnership? >> yeah, great question. we get this all the time. we think that apple will be getting paid. and -- >> openai is going to be paying apple? >> in some form. different balance sheet from the likes of google. different balance sheet, different modernization model. revenue share could be based on the usage -- >> my question is, though, is you believe -- can't be usage. i can't imagine that they're going to pay them on usage, they don't have a business model on the other side. so, the question is this a lead gen product. the only model i can imagine at the moment and maybe there is a different model is that somehow it is a lead gen business for openai and if there is any economics at all, somehow apple is taking a piece of anybody who

starts on the phone and decides to upgrade effectively to the paid product that openai is offering. >> well, andrew, look, i mean, the modernization models can be multifold. if there are developers sitting on top of openai, where are the developers going to sell their app or product? so the distribution model becomes one of apple. so, the developers are making money because you got consumer base that is effectively sending you all this information that you're then using to serve those developer base back, right? the modernization model from a developer perspective, the modernization model -- >> don't have to have a direct relationship with openai. you can go develop apps that use chatgpt and other services that underlie them that have nothing to do with apple. apple has nothing to do with that. >> so, on the technology side, yes, on the distribution side, no. like you still need it from a

distribution perspective. >> no information exchange where openai gets access to something about apple users, whether that's on a personal level or whether that's on a large -- >> apple told the public that they won't be doing that. i don't understand what you're talking about. >> i think you'll have a dual model where you will share information when it comes to the fact that you have an opt in. if you're opting into the tech, then there can be information sharing. if you opt into the tech, also they can be -- >> do you not hear the presentation i heard. >> it was the same presentation. >> and what do they say in the presentation? >> you got sort of an openai, chatgpt where you can opt into the tech, whether to use it or not, right? and then when you do opt in, then you can either be on -- already on a subscription, information share or not on a subscription, information is not shared. is that consistent with -- >> so you're arguing because people use it more often that that information is going to be

shared -- if you are using the paid product. but the majority of people are going to get access to 4.0 without paying, which means they're also not sharing. >> correct. while that be true, i think there is a developer ecosystem, right, that still needs to tap into a consumer base. so, the modernization model can be based on usage of what the resources are that are being driven because those developers now have access to consumer base that is driving that traffic. right? so you got a traffic component that is causing the developer to drive more usage. so, it is not clear, andrew, on what exactly -- >> you realize there is more usage that costs openai -- >> absolutely, absolutely it does, yeah. absolutely. 100%. and when it does, i mean, it also means that there can be information ultimately that they

use and -- it is sort of similar to search in many ways, right? in search you had this whole notion of google paying apple $20 billion. >> right. >> that's happening because the modernization model is ad-based. we don't know what the modernization model entirely at openai long-term is going to be. if it was ad-based, you could draw a similar analogy. if it is not ad-based, and a different model, like sam altman said, in his blogs, it is not an ad-based model, there is a different modernization model, that modernization model could be coming to modernization on usage of resources, and if that is the case, then the usage is very much driven by the fact that you -- which is the app -- >> we got to run. >> i think that -- >> apple is not paying them for the usage and the customer is not paying them for the usage and you're saying the developer is paying them for the usage but

the developer doesn't have to do that through apple? >> correct, yes. not through apple. >> correct. okay. thank you. >> we're done. thank you. 7:00 a.m. on the east coast. you're watching "squawk box" on cnbc. i'm andrew ross sorkin with joe kernen and becky quick. we're counting down the consumer price index for the month. the government's first of two inflation reports this week. then, markets going to be getting the fed decision at 2:00 p.m. followed by powell's press conference. national amusement stopped talks with skydance in a proposed merger. that deal had been reached but we're awaiting signoff by the company's owner shari redstone. the terms were not mutually acceptable. and international energy agency warning of an oil glut. oil production expected to outstrip demand growth by the end of the decade. a check on the futures this morning. again, wee are kind of in a

holding pattern ahead of the cpi number that comes in an hour and a half. the dow which was down yesterday up right now by 35 points. s&p and the nasdaq both at new highs yesterday with the s&p indicated up another 7 points and the nasdaq up by almost 30 points. let's get over to frank holland, check in for a look at the premarket movers this morning. hey, frank. >> good morning, becky. we start with a big mover this morning. that's oracle. see right here, shares moving higher almost 9% higher. also a number of analyst upgrades and all this after misses on both the top and the bottom line. an analyst raised the price target to 150, stock trading 135 right now. he says this stock moved to the upside, this move to the upside, that was largely due to the 44% year over year increase in current remaining performance obligations. that's a metric that gives insight into future business and it was also a lot of excitement around oracle saying it is teaming up with alphabet's

google cloud this fall and partnering with microsoft and openai. shares of oracle up just about 9% right now. back to the meme craze, gamestop says it raised more than $2 billion from its previously announced stock sale, selling the maximum 75 million shares allowed. the company has been riding that meme stock wave revival as a way to stockpile cash. however, you can see right here, shares are down, they're down big, more than 35% since friday when, of course, keith gill, roaring kitty, made his return to youtube. shares down 3.5%. byi birkin stock, the valuation is less compelling, birkenstock trades at 32 times forward earnings. the new price target, $58, that's where the stock is trading right now. birkenstock last earnings saying it is seeing strong growth in its clothes segment, best known

for sandals. i had a source who told me birke birkenstock, the favorite of joe kernen. >> i can't imagine closed toed birkenstocks. >> sold them, but never owned them. but i did sell -- you owned a pair, haven't you? >> absolutely. >> and a hackie sack? >> i wear them with socks. >> i watch people play that. and admired it, frank, but never -- you couldn't do that, could you? >> the birkenstocks, is that a new york city thing? i'm from philadelphia. i've never seen that. >> no, no, the hackie sack. >> no, the birkenstocks with socks. >> hackie sack, people that can do it, they're amazing. >> i can do hackie sack. >> it is good exercise, too. >> you got to wear the socks. with the birkenstocks and when doing the hackie sack and live in berkeley.

>> be really stoic. >> do it all together. >> i think it works in vermont. >> and vermont. coming up, what investors should expect from this morning's inflation data and the fed decision. plus, the main shipping channel in the port of baltimore is open for business. transportation secretary pete buttigieg is going to join us in a few minutes. ♪♪ ♪♪ ♪♪ chewy, a citi client, uses citi's financial expertise to help drive its growth and keep its supply chain moving, so more pet parents can get everything they need... right when they need it. keeping more pets, and families, happy. ♪♪ for the love of moving our clients forward. for the love of progress.

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you got the press conference at 2:30 which has a life of its own at stake with the cpi is whether the modest progress we saw in april continued in may or the backsliding of the first quarter returns. here are the numbers we're looking for. 0.1, tick down in the headline to 0.3, that will leave unfortunately the year over year unchanged at 3.4. and then not much progress on the month to month change on the core cpi, but that could give you a tick down. really what it has to do with a prior ones dropping off the old -- the calculation of the year over year. so, 3.5 ex-food and energy versus 3.6 in the prior month there. the cpi is one piece of the inflation puzzle for the fed. they need the wholesale price to get a good read on the preferred indicator pce at the end of the month. i'm sorry it is so complicated. then look at the statement here, possible economic downgrade, do they -- and the question, do they describe inflation progress as stalled or maybe now

continuing dependent on what happens this morning. they suggests they're still not confident, though, confident enough in progress on inflation to cut interest rates. and look at the projections, big debate, do they cut the average cut go down to 1 or 2 for this year? will they up the unemployment forecast with already at 4%. do they raise that level? and do they raise the long run rate from 2.6, they don't see the current rate as less restrictive. i would advise you to listen at 8:10 to our guest jeff lacquer, the former fed president. he has thoughts on that. i'll be watching closely the fed's average inflation forecast. everybody is concerned about inflation, everybody's hair on fire about it remaining too high. the core pce is at 2.75 year on year. on average, fed officials predict 2.6. the fed is only 15 basis points from where it thought it would be by year end. raises the question of how concerned it should be about missing its inflation goals for the year. andrew?

>> okay. steve, we are looking forward to seeing you a little bit later in the broadcast and throughout the day as we await all of these data points and numbers and hearing from jay powell. you don't want to give away your questions, do you? never does. >> i mean, it depends a little bit on where they go, you know? i'm issuing projections today and whether or not there is a consistency to it. i think there is business about them being 2.75 year over year on the core and then only looking for 2.6, how concerned should they really be about being so far off their inflation outlook? i'm also listening closely to jeff lacquer. he's going to make a case of why the fed is less restrictive than i think they are, and i want to hear what he has to say. he's at 8:10 this morning. >> okay. >> all right, we'll see you in a little bit. when we come back, the port of baltimore reopening for business just months after the

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and now the answer to today's aflac trivia question. on this day in 1981, which movie was released in theaters and became the highest grossing film of the year? the answer, "raiders of the lost ark." >> later this morning, maryland governor wes moore and transportation secretary pete buttigieg will announce the official reopening of the port of baltimore. secretary buttigieg joins us now with the details. secretary, welcome. this is a very important day and one that we have been awaiting the last couple of months. we all watched in horror as the bridge came down just a few months ago. maybe you can tell us a little bit about what the process has been and what it will mean to have that port back open. >> yeah, this is an extraordinary moment and it reflects the work ofliterally

more than a thousand responders, coordination across so many different entities and agencies. really an example of things working the way they should in the wake of a terrible disaster and tragedy. we all woke up to the shock of seeing what happened, the bridge collapse and the question of what would happen next with tens of thousands of tons of metal in the patapsco river, seeing how the u.s. army corps of engineers, the coast guard and so many different departments quickly came together to address that, i think really it is an extraordinary story and most importantly of all, it means back to normal for so many port workers who are hard working men and women, they have been through a lot in recent years, and while the port was not able to operate normally, many of them were out of work. this is a key port, especially when it comes to vehicle import and exports.

america's number one vehicle -- port on the east coast for that as well as certain kinds of bulk goods, specialty goods. good news for supply chains, but especially good news for the people and the workers of baltimore to have that open and to have it open less than 100 days after that shocking collision and the aftermath. >> the port of baltimore actually handled a record 1.1 million cargo ships last year. what will happen? there were a lot of things that had to be diverted. is this going to be business back to -- as usual? do you expect to see that same sort of pace pick up again? >> i think so. everyone who was using the port the day before that ship strike was using it for a reason because it was the right answer for them from a competitive standpoint. we did see a lot of other ports step up, whether we're talking about the container side or facilities in rhode island and georgia that are also specialized in vehicles. but we also saw scenarios where because of the facilities at

baltimore that are uniquely there to finish and address some vehicles, they would come into a port of rhode island or georgia or new york, new jersey, and then still have to be brought to baltimore to be finished. so, obviously much more efficient for things to be the way that they were. we appreciate the way the other ports stepped up temporarily to adapt and address that disruption. but now are really looking to see things get back to the normal business and the normal growth that baltimore was expecting and experiencing. >> secretary buttigieg, you're about three and a half years into your tenure as the transportation secretary. it has been a pretty tumultuous time for transportation. you can look at a freight trail derailing, you can look at boeing and the airplane door plug that blew off midway through, you could look at the faa outage that caused lots and lots of delays in 2023, you could look to the issues with southwest airlines, all the

delays they had in 2022, i think if you look across the landscape right now, i just wonder where do you think the biggest problems are, what do you think needs to be done when it comes to transportation and maybe some of the aging infrastructure we have there? >> we came through the door and immediately confronted the biggest, deepest and most multifaceted set of disruptions to transportation since 9/11. it is almost dizzying to think about how much has changed from year one, where we had the supply chain issues driven by covid, we had an airline sector where the biggest question wasn't on time performance, it was the survival of the airlines themselves. just a completely different and in many ways unprecedented set of issues. we tackled those issues, still living with some of the after effects of that, but at this point, can confidently say that every area of transportation is better than we found it and we know the work in front of us to

make it better still. whether we're talking about the performance of airlines, which right now we're on track to match last year, which is a decade long low in cancellations, just a year after what happened before that, 2022, and we saw all of those disruptions and cancellations, we have seen a new high water mark of passenger protections for airline passengers, and then now entering a new framework when it comes to safety protections that will maintain the safety record. our supply chains, night and day in terms of the performance that you see compared to 2021. i will say this, some of the vulnerabilities that were exposed in 2021 are still with us. concern about capacity in our freight rail systems, something that needs more investment, needs more attention, but things like that, and some of the other issues that we have seen, whether we're talking about sea, land or air, also point to the

other big thing that was on our agenda the moment we came through the doors, which is to get a historic infrastructure bill passed, something that previous administrations talked about, everything knew we needed, nobody could get it done. now not only is the bill done, but the money is moving, the projects are getting done, we're at 54,000 projects and counting from a street scape and town somewhere that can be done in the summer to some of the biggest infrastructure projects of our lifetime. >> let's talk about some of the very specifics, with some of the problems that have happened with boeing and the door plug blowing out, the accusation was that the government took boeing's word far too leniently and allowed them to do their own oversight. where do you think boeing stands today? how safe should we feel on boeing planes? how strongly do you feel like there is a great product that is being made on the production lines right now? >> well, the faa put boeing under a microscope in the words of the administrator. there is no going back to

business as usual at boeing. at the end of the day, the government -- the faa sets a quality standard and it is boeing's responsibility to meet that standard. the administrator put them on a 90 day clock to come up with a comprehensive plan demonstrating how they were going to address some of the quality control issues. those 90 days are up, they presented their plan, now there is going to be an intensive phase of monitoring and evaluation to see how they're doing to meet that plan and we're not going to let them increase production until they show that they have. look, this is all the product of a level of extremely intense public and government set of expectations about aviation safety that helps to explain why just in the time since we got here, about 3 billion airline passengers have stepped on to a plane and zero of those 3 billion have lost their lives in the fatal airliner crash, keeping that record up is not something that anybody takes for granted. we need to press to maintain

that, while also looking at other sectors that frankly need to move closer to that level of rigor and intensity in their safety culture. i'm looking at the freight railroads in a couple of weeks we're going to see ntsb's final report on east palestine. there is no excuse for congress to be sitting on the railway safety act. that needs to pass and add tools to our tool kit and automotive safety, where we lose in this country the equivalent of about as many people as can fit into a 737 every single day. we have finally seen the numbers start to go in the right direction, reversing the rise of roadway deaths seven quarters in a row that's gone down. but still talking about roughly 40,000 american lives lost. it is equivalent to gun violence and in my opinion completely preventable. >> is automated driving the answer to that or is it something else? >> i think in the long run, the safety payoff of automated

technologies, when it comes to driving, could be game changing, but precisely for that reason we need to be vigilant and intense about insuring those technologies develop safely. it is not binary, it is not like one day all the cars drive themselves, there are things available right now. we completed work on a rule requirie ie ing automatic braki. and we'll be reaping those benefits in the years to come. certainly we need to make sure the technology meets its potential, the life saving potential of that technology is truly extraordinary. >> i realize you have to run and i'll ask you one quick last question. southwest airlines, 2022, the meltdown they had where 17,000 flights were canceled, this week we learned that investment management has taken a $1 billion stake in southwest airlines. there needs to be new leadership

at southwest airlines. how do you feel about an activist investor stepping in? is that good for the company? is it good for shareholders? is it good for travelers? >> our role is very different from the investors' roles. we're not here to pick or choose management or corporate strategy, we're here to hold the airlines to a certain standard. a safety standard, which is paramount. and then also a customer service standard. we broke records basically added a zero or two to the past practice in terms of the toughness of our enforcement when it came to southwest record-breaking $135 million enforcement action to make sure that they take better care of customers. and they did cooperate with us ultimately in getting that done. the bottom line is that it is about the results, and the results for passengers are what we are most responsible for. companies can worry about the results for shareholders, but from our perspective, on the

regulatory side, only after they have met their legal responsibilities when it comes to safety, performance and taking care of passengers. >> secretary buttigieg, thank you for joining us today. >> thank you. a quick programming note for you tomorrow, we have an exclusive interview with treasury secretary janet yellen. but first, the latest data on mortgage demand. eaig aerheing up rhtft t brk. your record label is taking off. but so is your sound engineer. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire

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the weekly report on mortgage applications is out. let's get to diana olick with the latest hey, diana. >> hey, joe. yeah, mortgage rates dropped for much of last week, causing demand to surge nearly 16% compared with the previous week. that according to the mortgage bankers association. but after a stronger than expected monthly employment report friday, rates jumped back up again. so for the week, the average rate on the 30-year fixed for conforming loans decreased to 7.02% from 7.07% for loans of 20% down. for the bulk of the week, rates were actually lower than that. but friday's news caused rates to jump 12 basis points according to a separate survey from mortgage news daily. so, applications to refinance a home loan, which are most sensitive to those daily moves in interest rates, jumped 28%

last week compared with a previous week. we're also 28% higher than the same week a year ago. va borrowers led the charge on that. politics for mortgage to buy a home rose 9% for the week, but still 12% lower than the same week a year ago. home buyers are not only contending with high interest rates, but also high home prices. inventory has also been lean, monthly survey from fannie mae found that 86% of consumers said now is a bad time to buy a home. now, mortgage rates didn't move much to start this week, as investors are waiting for the results of the monthly consumer price index. and the outcome of the fed meeting and commentary on inflation later today. >> if we did get a cut in -- let's say a cut in september, would mortgage rates come down? would there be relief? >> well, mortgage rates don't directly follow the fed, they follow the yield loosely on the ten-year treasury.

but what the fed is saying about inflation and about further rate cuts, that influences rates. so if you did see a rate cut, you would likely see mortgage rates come down. >> that's weird, that's where it seems like that helps inflation. but we have been going back and forth. anyway, thanks, diana. all right, still to come this morning, we do have that inflation data on the way. we're about an hour away from the release of the may consumer price index, we'll have the numbers and instant reaction. and then at 8:40 eastern time, former microsoft ceo and founder of usa facts steve ballmer will be our guest before he speaks later today about the economy, healthcare costs, housing and more. "squawk box" will be right back.

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coming up, former president trump meeting with business roundtable ceos tomorrow. we're going to get into trade, taxes and regulations with former house speaker kevin mccarthy. that's next. "squawk box" coming right back. (♪♪) car, this isn't the way home. that's right james, it isn't. car, where are we going? we're here. (♪♪)

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powerful business lobbying groups in washington. joining us now, former house speaker kevin mccarthy. good to have you on set. >> good morning. >> good to see you. and i guess everybody -- a lot of eyebrows have been raised as some of the people that you thought might never come back to donald trump have come back, whether it is some of the meetings in silicon valley in fund-raisers, schwartzman or whatever. the business round table, we're talking about josh bolten, chief of staff, for george w. bush, and really kind of represents the old guard of the republican party. and conservatives. that group does in terms of no tariffs and a lot of things that trump sort of turned upside down in a populous way. what does it mean that they invited him in and is it -- is it a really -- is it still a frosty relationship? are they actually embracing him because there is nothing else they can do at this point?

>> i think they see what everybody else sees, he's going to win. if you look at who is in that room, but if you look at -- i was with the president -- >> he's going to win what? >> he's going to win the presidency. >> you think so? okay. >> he's going to win the presidency -- >> they need to be on board. if you think of these names, if you think i was with him monday in palm beach, the president came through california, i saw people who have never given to trump, who would avoid trump, not only giving him big money but putting their name out there and showing up. and this is all after the conviction. it is almost that they're frustrated by what has transpired that they feel it is coming after them too. the business roundtable, i think, having the president in there, what it tells to your viewers is the next administration, businesses aren't going to focus on esg and dei. they're going to focus on running a business. it is going to be stronger for america and the others. it is not -- i've beenon the show many times, even in the

primary, telling you he's going to win and he's going to win the general. if you look at data, which your viewers do, and if you look at where president trump was an an incumbent four years ago now, it is an 8.4% swing. if you think about the election, biden won, but he only won by 48,918 votes. and his favorability was plus 10. biden is sitting at a 37% favorability right now. the lowest of any president at this moment in time. so if you check pure data, it is fundamentally different. if you look at the electoral college, and those six swing states, you can't say six anymore. because virginia and minnesota has come into play. i was texting with governor youngkin this morning and you're seeing something different. so, if trump is expanding the playing field, whichever side is on offense has a better chance to win. the senate is an excellent map for republicans. the house, they have a better

chance of winning this cycle than they did the last two cycles. >> ask you about a lot of trump's stated policies are still not what the business roundtable would put on its list of priorities. is it -- how do they reconcile 10% of tariffs on everything? how do they reconcile some of the populist, you know -- >> you're assuming the business roundtable is right about everything. they have been wrong about china. i think the one thing when you thought back in 2016, a lot of people were upset with trump and the business roundtable saying he might be wrong about china, now everybody has shifted back. >> i remember calling those guys -- >> they were wrong there. look, when we look at the future, you have people on here all the time about a.i., and next time i come back, i got some exciting news of something i'm going to announce, following on the things that i worked on in congress. if you want an a.i. future you have to look at the grid.

we have got to expand our grid. who is better to do that than donald trump. >> can i ask you a question. do you think the ceo community and the business roundtable, which has spoken out against the president, after january 6th and prior to that, so many business leaders who had joined various committees and things to try to advise the president, if you remember, and stepped away after charlottesville and the like. do you believe that they're doing this because they -- it is a binary choice to them and it is who they dislike more? it is that they actually now like trump and they don't remember what happened before? is there some kind of amnesia effect going on? what do you think is happening here? i'm trying to understand. >> there is a combination, but it is not just the ceos. if you look at the cnn poll, which was done probably three weeks ago, they asked america, all americans, was the trump presidency positive?

55% said yes. if you go back four years or three years ago, it was at 41%. i think it is a combination. >> romanticizing the past? >> you're now living under the policies of biden. this election is more about biden than it is about trump. and so when you look at the current policies, people are more concerned about the border, inflation, and they remember even if you're in the business roundtable, there is also, if you wanted to support trump, you got blowback. now they're feeling they could actually say what they truly mean a number of them. some people could be in that position. it is more so, they see a better position on policies comparing these two individuals who have been president for the last eight years. >> there is new pew research out that suggests when they polled 34 different nations, they found that these other nations have more confidence in biden than trump. 43% to 28%. i don't know what that means.

43% is not great either. it means more than half don't have any confidence in either of our leaders. what does this mean for us in the world stage? >> i would tell you as america as a whole, americans need to look at stop demonizing each other. we fight over small things instead of planning out for the next 50 years and that's what i want to come back in a couple of months and lay out what we can accomplish this. i spent some time since leaving congress traveling the world. just was over in asia, meeting with a lot of different foreign leaders. i still talk to a lot of different foreign leaders. if you see what is happening in europe today, the current foreign leaders are not in touch with their constituents. you see a more conservative movement. and a lot of that is spurred by trump. so i really don't believe in that poll. i have talked to foreign leaders that are in office today that felt the world is safer when trump's in office because they now see that you got a new axis of evil with china, russia, north korea, and iran have bound

together, which didn't happen -- >> we just had a report said there is going to be a glut of oil. we're producing so much here now. believe it or not. so, how do -- is the narrative still that biden is choking off the fossil fuel industry when we're at records, and as a result, how does trump walk in on day one and cure inflation like he says he's going to do, if you've already got basically, you know, 78's not great and gas prices stills 3ds.50 but we're producing a lot of oil and fossil fuel. biden's been unable -- democrats don't want to take credit for that obviously because of climate change. >> where biden harmed us, no permitting reform. some in the -- >> we need more oil? >> double our grid.

some of our greatest strength is our natural gas. we are the saudi arabia of natural gas. simply replace russia natural gas in europe one year we lower co2 emissions by 218 million tons, because ours is cleaner. biden came in and has now stopped the movement of natural gas which harms our allies in europe it would strengthen our economy and you've got to look at energy policy kind of the way trump did. it's all of the above. >> how do we bring inflation down? what do you do? firing jay powell and putting a guy in that will bring rates down to zero again? >> no. that's not going to help. one of the biggest drivers and problems is our debt. >> right. >> government is spending way too much. >> so extend the -- extend the tax cuts and the debt will stay where it is. right? >> well, if you think the tax cuts are creating the debt you're not looking at the real problem here. the tax cuts are not creating the debt. it's these entitlements in what you're spending, he doesn't want to do anything about

entitlements. social security or medicare. >> it doesn't matter what party is in office if he don't deal with this they will have to. >> right. >> cuts will come. you have sew save medicare and social security. you've got to deal with it now. the options are greater. and, look. i prosed to president biden at the time we did the debt ceiling, deal with it the way we dealt with brac. everybody's gets appointments gut a vote up and dour, no amendments how ronald reagan and tip o'neill belt with social security in the past. >> are you going to watch the debate? >> yeah. >> got to go. i got to ask as mace. what is going on here? because you, your pact supporting the other side of this situation. >> i think it reads -- the thing i saw within there, if you look at the polling, a trump endorsement mattered 38%.

after the conviction it mattered 68%. president trump is stronger today than at any other time. >> then you're on the wrong side of this one. right? >> look at races coming up, june 18th is the main race. bob good versus john mcguire. ap state senator, a navy s.e.a.l. look, president trump and i are supporting john mcguire. he's have a very big night, send a very clear message that republican party and donald trump needs conservatives willing to gorn. you can't see "no" and solve a problem. >> what about mace? >> president trump's endorsement meant a lot to nancy mace. president trump endorse her and she was able to move forward. >> your money on the other side. >> money coming in all sides. people are all concerned about

that. look, my focus making sure republican ps keep the majority pip fund -raising for trt. i'm looking at issues from a.i., energy from china how we best set when we take majority what can we achieve and make america move forward. >> i see a quagmire. >> it's a quagmire. and what happens a quagmire? you get these two guys running. thanks. >> thank you, guys. when we come back, a lot more right here on "squawk box." inflation at the grocery store. talking about food prices taking a bite out of family budgets. something to do with probably the way voters may feel about things. consumers shopping for bargains. find out which stocks would den fit. don't forget about the big fed meeting. former richmond fed is with us, straight ahead. janet yellen tomroonorw the broadcast in an exclusive

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unique retail, according to ane. renewal rater. do do you like and what's happening to prices and margins? >> good morning, andrew. thank you very much for having me. these days we like a combination of walmart, costco, target. ulta. stocks of companies in the retail sector who either have very good momentum and stand to benefit from what's happening with the consumer, or stocks where they've been left behind and are incredibly expense iran and plans to play catch-up like a target on ulta. what's happening with prices at the grocery store is we've been through a period of inflation across retail. prices since 2019 are up 30%. that's a lot of inflation passed through to the consumer. and right now the consumer's being very choiceful, very

discerning with what they purchase. it's going to favor a select number of retailers, even if the number of retailers where the consumer is shopping expanded versus where it was a couple years ago. >> what will you be running away from at this moment? >> right now, if a company is facing competitive threats that are going to threaten its margin structure, that's going to put the company under pressure, or if it's over-earning. certain sections of seeing trends. in the united states people are moving. 2 million less home seams today than a couple years ago because existing home inventory is under pressure. all of the things that go along with the purchases when someone moves, the tv, a couch, tables and chairs that is under a lot of pressure that's going to drive more promotions, more

discounts. >> a disconnect, i think, for some viewers watching. right under you writing "the end of one-stop grocery shop." yet at the same time you like walmart. i think trying to square that circle would be helpful. >> so i think the headline is probably a reflection of what happened last year versus the last couple of years. there is no doubt, andrew, that in 2021 -- in 2022 to some degree, people consolidating shopping trips, fearful of going into a number of retail stores. that expanded in 2023. but what is also true is that serving retailers are now having a disproportionate share of wallet because it is easier to do business with them, competitive price, compelling assortments and that's inspiring more loyalty amongst the consumer demographic. that includes retailers like costco and walmart.

so the end of one-stop shopping might be a bit extreme. yeah, the consumer is moving around a bit, but they certainly are consolidating their spend amongst a fewer players. >> michael, always good to see pudge appsee. appreciate you joining us. 8:00 a.m. on the east coast and you are watching "squawk box" right here on cnbc. i'm becky quick along with joe kernen and andrew ross sorkin, and among today's top story, economic growth in the uk ground to a halt in april after a muted rebound from recession. first three months of the year. the flat lining growth expected by economists who wlamblamed a y month from keeping consumers from spending. nelson peltz. telling cnbc seeking to engage with leadership on ideas to improve shareholder value. and oracle shares are

sharply higher. earnings and revenue coming in slightly below estimates but the company announced cloud deals with google and openai an as a result stock is up 7.5%. citron research saying no longer short gamestop. post on x, it doesn't believe in a turnaround, but $5 billion in the bank they have enough runway to appease cult-like shareholders. adding, by the way, the roaring kitty was an insult. trading $35.65. joe -- >> gratuitous shot at the end. why not? >> why not? except for the fact that i could argue roaring kitty has roared again along with its suitcase. >> capitulating. burned again. >> sounds like it. >> issue by the bears -- >> in the bank. >> yeah. let's check the futures.

people were set up before anything happened in the actual market session. gamestop right now, gamestop -- up 33 now on the dow, which actually was diverged from the s&p and nasdaq yesterday, but all green today. mike santoli joins us from the new york stock exchange. a closer look at the markets. if looking for leadership from apple again, i guess we can check that box. >> yes. exactly, joe. you know, apple takes over when nvidia took a arrest and has been enough to protect the s&p 500 on a given day. one of these huge stocks working. majority really still chopping lower, consolidating. so the formation of the s&p 500 look goods. up a percent and a half, 2% end of first quarter. 5% pullback. seemed like kind of a minimal incomplete pollback, seems like majority of stocks are caught in

that sideways zone. because of the strength of some mega gaps, index investors doing well. 5375 where we did finish up yesterday. you mentioned apple. apple retttive to s&p 500. over the last two and a half years. this is from december of 2021. that's when apple first went above the 180 dollar share mark crossed over 200 yesterday. you see, yeah, sure. vaguely speaking kind of taking a different path to the same point. i like to point out there have been times when apple has actually been down, and the stock market and s&p has been up. it's not a bellwether in the sense it has to work for the stock market to go up at a given moment, but has leads and lags. of course it is a 6.5% or so weighing in the s&p 500. if microsoft and nvidia are virtually equivalent and together 20% of the whole. yesterday one of the areas

didn't work, banks. under pressure. a low conviction area. look at it compared to the broader financial etf. this is a two-year chart. this is when it diverged. silicon valley bank failure. not really gotten escape velocity off the lows trying to hang in there, even though the company is good. why so much bet terbetter? 13%, berkshire hathaway, not lenders. non-bank financials kcontinuing to work and maybe more important of a confirmation of a broader market track, joe. >> all right, mike. thank you. we'll be watching. all right. in just under half an hour's time getting the latest rate on inflation at the consumer level which is expected to show a slight increase from april. and even though the fed is widely expected to hold rates steady at conclusion of its two-day policy meeting sewed markets will pay close attention

to any change in guidance and language at chairman jay powell's press conference this afternoon. joining us jeffrey laclacker. and jeff, thank you for being here. probably not something that changes anything for today but could have a big impact on when we can expect to see a rate cut. what do you anticipate first from the cpi and then what do you think the impact will be in terns of when we could get a rate cut? >> best guess for the cpi is the core's going to continue at about the rate its been. north of 3% at an annualized rate. consistent with the figures shown earlier today. headline down, just because gasoline prices have come down. but the broader question about the fed policy stance, i think there's a case could be made that they're not as restrictive

as they thought. i think that's the broad theme of why they've been pulling back on expected rate cuts this year. i don't expect any rate cuts this year, frankly. >> on earlier this morning, a guest says, wait until inflation gets back into a level where the fed feels comfortable with things, it's going to be a problem. that things are slowing down already in areas not just like credit. some of the banks, real estate and other places you're going to see problems kind of coming up. he made the point for small businesses trying to borrow at 1% in1 per1 -- 9% interest rates will affect unemployment. his point cut now before things get too far out there. what would you say back to that? >> so the economy's been exceptionally strong over the last couple of years. growth has been strong. labor market very tight. i think that's a sign that we're

above maximum employment the way the fed is sort of charted to think about these things, and to the extent that that's not sustainable at a 2% inflation rate, i think that's some of the sacrifice you got to get to get to 2%. i don't see plausible risk of the economy falling off a cliff into a recession. anytime soon. that could emerge. but it's not on the horizon right now, if you look at the indicators. so, yeah. some sector, going to be up. some sectors are going to be down over the near term. that's a sideline compared to getting inflation to 2% on a sustainable basis. >> and in other words, this is the type of thing that you need to see and the fed actually expects to see before it can actually lower rates? >> certainly, yeah. >> in the room today my guess is even if this was a very hot or a very cold number, it's not going to change what happens today?

>> no. i don't think so. i think, you know, all eyes are on the dot plot i think for today. for better or for worse. the way they've designed it. i think that they're wrestling how restrictive policy is, and i noticed you had steve liesman on your show. excellent correspondent, and analyst, and making the case that policy was pretty restrictive. i beg to differ. i think that if you look at the 5.3% funds rate, compare it to trailing 12-month core pce inflation, favored indicator, it's just 2.5% real rate. if you compare it to the year-to-date core pce number of 4.1% inflation, well, then it's a real rate of 1.2. which is not very restrictive at all. and those figures happen to bracket the, at current

estimates, of our long run mutual real interest rate from the two standard molds the federal reserve system using. one, the new york one, lawbuck williams 1.2% and richmond fed less attention, because there's more, a little math is 2.5%. those are right in the ballpark. i'm going to be looking in particular at the right-hand column on the dot plot that shows estimates of the longer run federal funds rate. that inched up a tad and, in fact, look at the dots, eight people moved their dots up, revising upward their estimate of the neutral rate. i expect that to continue at this meeting reflecting their sense that, yeah, policy in december wasn't as restrictive as they thought. >> yeah. i guess your point is we're not going to see a cut until next year at some point. if we get a hotter than expected cpi number today, does that

absolutely mean we won't see rate cuts this year, because you have to see months in a row before anything can be -- >> i just think they're off the table this year, period. they had six really good inflation reports at the second half of last year. then they four bad reports. what will it take to convince people that, yes. that four bad reports isn't going to happen again after another six good reports? at least six reports are good. and it's going to take few more, too, that takes you into next year. that takes you to december. i just don't think they're going to be as confident as they want to be, because you have to remember. the fed's averse to whip selling the market. cutting an end like within 12 or 18 moss, having to raise rates again. i think you know, the case they might have to raise rates in 2025 was a serious one. it's on the table. i think they've got to be

prepared for that as well. >> jeffrey lacker, former richmond fed president. always great to see you. >> great to see you, too. great to be with you guy. coming up after the break, future up in the air again. last week told wasn't convinced skydance would lock up the deal. for now, he may be right and joins us after this. "squawk box" will be right back. you bring a lot back

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eminently is a bit cart before the horse. i think sort of some point of recourse between the two sides and i think it is not clear that this transactions going to move forward as planned. >> well, rich greenfield with us last week. as you can -- i don't need to tell what you he said. saying skeptical a deal would get done. yep. what he just said. news broke yesterday that the merger was called off after national amunsments said it had

not been able to reach acceptable terms on the potential transaction. joining us, rich greenfield. i mean, with what they implied yesterday, rich, and what you said last week, what was really happening behind the scenes? where were the problems? >> look, i think this was never an easy transaction. it was easy for national amunsments and the redstone family. they would get paid a lot of money. public shareholders deal wig a me dealing with a merger, combination with another studio lead between the studio and cash infused lead tosubstantial delusion. pain from the lawsuits relative didn't add up. she's not crazy. everyone's going to call her crazy. i don't think this is an insane idea to go back, what we've been

saying a long time. there's a lot of easy lifts that would have been done. sony and apollo bought this, if skydance, many easy things that people would have done. i think now with her new team and maybe a new ceo coming in soon, rather than the three-headed current situation, they're going to chop a lot of the low-hanging, you know, fruit off of this tree right now. like, there's a lot of basic things to do, and then, joe, you tell me. who's going to be president in six months? >> meaning which deals can get done? >> exactly. >> regulatory environment in a year could be different, and you think -- not saying it's easy. i don't know what i'd do with any media company right now, but a lot of the bad news is already there. so do you some of the easy lifts you said. shareholder value, revis the of m & a in a year might have better regulatory environment. i felt a loaded question. you've seen some of our

conversations about the el elec elections. times i want to hide behind cnbc and businesses. i really do. >> i don't care about your political views. i care about -- >> don't even bring it up. open up a can of worms. >> i just meant the -- things that are possible. plenty more deal possibilities, and on top of that -- look, when you think about where they are right now, you know, the ability to, paramount+ is not working. simply said, who wants to licence our content or work with us? you'll get, i mean, your parent company, nbc universal would love to enhance peacock. david zaslav would love to enhance max. amazon team would love to expand prime video. so many choices. once you decide that paramount+ is not in your future you're not competing with netflix, opened up a whole ray's strategic

possibilities, saubstantially entans revenue. bob bakish and the former management team refused to sell. i think they're going bring in a team that wants to transact, make the company smaller and more profitable. >> rich, can we pivot to the larger picture? this idea, and we're hearing it in the media world, i think because they are waiting for a moment where there's a regulatory landscape where a lot of chess pieces can move. if the former president, former president trump, becomes president again, do you believe that actually all of these chess pieces can move? he has been very public about his dislike for some media companies as we know. he has very personal feelings about a whole number of media companies, and so the question, to me, is, how different actually would the environment be today versus tomorrow, and if, in fact, president biden wins again, does that mean that

everything is on ice for another four years? >> well, let's start with the easier one. assuming lina khan, you don't have a major rotation in doj, ftc leadership. it does feel like there is a real chill across the entire sector m & a-wise, which is tough when you've got industries, joe talked right at the very beginning all the challenges facing the sector. normally when sectors go through this type of, you know, sort of crisis, or fundamental change in behavior, i think consumer behavior, consolidation is your savior. so if consolidation isn't possible, that's going to be a real problem for this entire industry. you know, if, look, trump is president, it will still matter who's in charge and who takes these seats, but i do think that even if we're talking, andrew, you couldn't merge, let's just say because he doesn't like nbc or doesn't like abc, you can't merge with those parent

companies, i think the tv stations, paramount owns non-cbs tv stations. people don't remember that. sell those to a financial buyer. a host of them, if you didn't have sort of this regulatory hate of broadcaster consolidation right now. >> right. and you could probably pay in bitcoin, if it was trump. you'd get -- right? >> look, i'm not going to go there, and, look, i think predicting trump's views on anything is obviously impossible and they change by the minute. >> rich, i mean, it's -- down so much from what it was worth. why not try to fix it a little and sell -- i mean, if you believe in the future of anything, you're right. i mean, ought to be able to add 10, 20, 30% of value to this and then sell. no reason to just do a fire sale right now if you're sharon redstone. >> we predicted beginning of the year, no major m & a this year after yesterday i feel even more confident, no major transactions

in this space this year. >> okay. rich greenfield. good call, by the way, and -- >> thank you. >> thank you. yeah. actually knows something. and you come on. awesome. when we come back, new inflation data. cpi out in just a few minutes. we'll bring you those numbers and the instant market reaction as soon as they crs.os stay tuned. "squawk box" will be right back.

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welcome back to "squawk box." futures right now, not much happening there. 16 points on the dow. there's green, but small numbers. take a look at oil. international energy agency warning a u.s.-led surge in global oil production is expected to outstrip demand, demand growth by end of the decade saying that that will push spare capacity to unprecedented levels and potentially upendopec's market

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we are just moments away from the release of the may consumer price index. our panel, economic studies senior fellow at the brookings i institution and from the arcata institution and rick santelli with us as well. in the green barely this morning. dow up about 25. s&p up by 6.5. nasdaq up pby 28. expectations for a headline number month over month 0.4%. and core month over month 0.3%. core year over year 3.5%.

ahead of this treasury market with u.s. ten year sitting just below 4.4%. 339. two year is sitting at 483. all right. right to rick santelli. he is going to have those numbers in just about five seconds' time. rick? >> yes. may read on the consumer price index and, of course, this is expected to be a big deal for the fed, which meets today, by the way, and it is hitting the wires. unchanged on headline month over month cpi. unchanged. as was pointed out, expecting up 0.1%. unchanged is the lowest level going all the way back to may of 2020. call it four years when it was minus 0.1. several reads that have been zero. now, look at energy up 0.2, becky pointed out.

0.1 lighter than expectations. rear view mere, 0.2. last time at 0.2, october last year find aglower number up 0.1, august 2021. year over year numbers. 3.3 on year over year headline. 0.1 lighter than both expectations and the rearview mirror. 3.3 is the lightest going back to february when it was 3.2. we started the year at 3.1. finally, food and energy, core year over year expected 3.5. last look, 3.6. comes in at 3.4. 3.4 lightest ledvel, a long way basically three years to april '21, 3.0. even last month the, real void. by the way, it shot up aggressively post-covid. becky didn't give you

expectations for the indices. i consider them maybe "the" most important. headline none seasonably adjusted actual index moved up to 314, .069. seasonally adjusted 318, .14, new yall-time high underscoring angst population has. no matter how small the month over changes get, cumulative effect is substantial and what the indices continue to show us on a month over month basis. yields as expected have dropped rather dramatically and now we're getting right back into the, where the area the trade was before the non-farm numbers were released last friday. we're hovering right around 427, 428. that was the low yield before we skyrocketed on the jobs report.

short end of the market dropping as well. we're now at 468, as becky pointed out. we're at 483-ish before the number substantial drops. pre-opening equities moved all the way up to, up 260 points and the dow futures. becky, back to you. >> rick, summarized it so well. your point, basically erases the jobs number that showed maybe something that wasn't going to bring us rate cuts. erases that number and evens the table again? the playing field? >> yes. i would think that's exactly right. >> wow. okay. these are really big moves. get right to steve liesman who's been digging through the numbers, too and can join us with more on why we got these numbers. steve, what was the issue? >> yeah. first, topically, score one for the dubs here. a contest here between the disappointing first quarter and the great progress of last year.

bringing down inflation. question was, did the first quarter auger a new beginning cycle? april and may suggested that wasn't the case, and this debate over whether or not it was renewed inflation or this issue of sort of beginning of the year price increases seems to be, or at least is being settled now, in terms of continued progress on inflation. energy minus 2% with a 3.6% decline in gasoline. new vehicles, a pretty big drop. minus . 5. used car the other way. 0.6. interesting. surge commodities up 1.3. we did the number importantly without a lot of help from housing. owners quick lent rate at 0.4. not reflecting change people think is happening. point out diana olick yesterday renewed increase in rents.

again, the motor vehicle insurance number surge the 1.8%. thought to be catch-up from higher auto prices leading to higher influence prices? down 0.1. airline fares, renew an old debate between joe and andrew down 3.6%. a lot of, as rick said. zeros and negatives in here. you get the impression what you saw in the beginning of this year, becky, was beginning of the year one-time adjustments. this is not tremendous progress. it's going to give the fed confidence to cut, but at least puts us back on the road. right now, look it up. probabilities now, which i'm guessing are a bit higher. 54 was the number for september. and now it's 69. so gone from a coin flip to a little bit more confidence now. september rate cut and 82% for november. let me see what the year-end number did. january, '25, gone from basically thinking of 1.8 cuts to 2.2 cuts.

which means kind of restored the second cut. not a dramatic move on futures but a little more confidence end of the year could bring us rate cuts. >> saying this for 24 hours. flip-flopped just in time, steve! yesterday. remember? >> it was yesterday. >> it was yesterday. >> joe, long as you -- >> saying this for 24 hours. >> long as you gave people the heads-up to make the trade, joe, you're good. that's all that matters. >> who talked yme into it yesterday? >> i did. >> steve did, and somebody else. inflation -- oh. david malpez talked me into -- plus, help, debt service wouldn't be so high. it's obviously need to cut. >> on the other hand bring in the rest of the panel now. >> zero rates? >> all wait down. >> i don't agree with your

flip-flop. >> until trump fires powell. back to zero. >> eight kbryears. zombie companies. disinflationary sign for pennies on the dollar. that's supposed to happen. housing? zero rates. ended up really turning the industry upside-down. locking people in. so, what? easing now? the easy way? you know, there is no abkomey to interest rates. flip-flopping interest rates after eight years of zero we're going to pay a price. no free lunches. squeeze that water ba lon on lower rates creating issues in other areas. not a good idea. >> rick, give us two minutes to enjoy the lower inflation rate? just two minutes. come on! everything you say is right, but -- >> goldilocks. >> give us time to say, hey, we're not going off the edge. >> we're talking markets here. real money. >> and let's bring in windy on

this. you said even if a good number better than had been anticipated, it would still not be clear for the fed to cut rates. is the market getting ahead of itself? dow future us more than 250 points. steep drop-off, 11, 12 basis points ten-year yield? >> september rate cut is still on the table, i think. generally speaking the economy remarkably resilient in the face of what we saw was tight monetary policy. al alternative, maybe monetary policy isn't as tight as we think. for it to be tight fed has to get rates above where fundamental factors are putting them. there are a bunch of fundamental's factors pushing up rate now including federal borrowing. if federal borrowing it pushing up rates more than the fed or we sough thought a reason fed's got to keep rates higher longer.

>> intuitive. deal with inflation, and get things back down to a reasonable level. talk about what you think, too, because i think you've been fairly hawkish thinking the fed can't do this all alone? >> yeah. i actually, you know, i agree with wendy entirely. i think one of the factors wep don't talk about enough is the role that all of this borrowing and interest payments weighing on the debt. much higher than defense spending and medicare spending. all of this is making it very, very hard for the fed to create, to land, land this plane. i think it's -- it's wishful thinking to think that anything is going to happen until some of that is taken -- at the very least some of the fiscal pressure is taken up. a little move there, a little

move here. to me it means we're stuck. disappointed no one talks about the role of the fiscal side of this. i was heal to hear wendy mention it. >> so fiscal side of things meaning that the debt we've taken on, and also the spending, wendy, that is taking place at this point. really isn't something the fed can do by itself. >> and borrowing. >> and the interest payments. right? i mean, this is one of the things that changed dramatically since the fed started fighting inflation. because interest rates going up, and because so much of our debt is short term. a third of the debt is maturity l less than a year. weight of higher interest rates is felt opt imalmost immediatel. you see it in interest payments exploding making the job of the

fed much harder. >> joe threw this out kind of as a joke. literally, what would happen if trump were elected and fired powell and put in someone who would keep interest rates very low. >> oh, come on. >> come on? joe said it! >> i think maybe we could -- isn't that what we doing in -- go down a little, lower rates and larry summers circulating a chart last time putting inflation, the '70s and '80s. remarkable how the two things are moving together very well. so i worry that, you know, worrying like a -- lowering too fast means inflation will pick back up. i think basically they haven't been fighting inflation. they've just counted on the fed and the fed can't do it alone. >> rick i think you'll agree with that.

what would happen if there was a fed chief, powell or somebody else who actually lowered rates at this point? you would be concerned, i would think? >> yeah. i would be, but i just don't think so. the current president needs to wake up and consider what to do more with monetary policy. sorry. what may happen, that did-- i'm dealing with the present. veronica made a great point. keeping rates at zero eight years. do we forget all of these things? and the debt payments, i would like to ask her, isn't that a huge incentive that nobody talks about that should the fed lower rates, with so much of that debt, maturing in one year, how much lower their payments would be? gee, how juicy would that be? things, of course, under the third rail. can't discuss that. they're apolitical and would never consider something like that. uh-huh. >> back to wendy. brought that point up to begin

with. the idea that you need to, if you are looking at the federal interest rates climbing, beyond what the fed thought you've got to keep rates higher longer, because you can't fix low rates with low rates. have to fix it by fixes inflation. >> right. i did not mean at all to suggest this was making the federal reserve's life harder in a sense, because the economy was really strong and inflation coming down. i mean, if anything, the fed is doing an excellent job and we should be thrilled with the state of the economy. i just meant to say -- this is a reason to keep rates higher longer. one thing i want to say about one of the reasons we worry about federal borrowing is, you know, it's -- it has slow and negative and modest effects on the overall economy. but the tenure of the conversation in the lastfew minutes we worry about federal borrowing because, some kind of urgent crisis sense, and you'll notice that the panelists,

guests, talking about capturing the federal reserve. that is not higher federalcal c. that is stupid political actions leading to a fiscal crisis. it's not federal borrowing we need to worry about. it's politicians we need to worry about. >> hmm. >> i don't know about ay griiagg with that. thank you all very much. coming up after this, don't miss it. talking to former microsoft ceo steve ballmer on everything, data transparency toy a.i. and so much re we're coming right back. we.

joining us from washington preparing to present lawmakers with economy data and policy recommendations this week. joining us, steve ballmer founder of usa fax. chairman of l.a. clippers. former ceo of microsoft. means we have a lot to talk about this morning, steve.

great to have you on the broadcast, but let's start with the facts of it all and what it is youish planning to present and what are you hoping that lawmakers take away from what you're presenting? >> well, first, thank you guys for having me on. it's a pleasure to be back. i started an organization, usa facts with the job of presenting our data the same way a company would. in an s.e.c. 10k form and do an annual report. usa facts for government in the united states. i'll be presenting the data that comes out of that to legislators, executive branch folks. the purpose? we have to make data-driven decisions as a government. people have to be looking at the same number. like a business, whether it's revenue, expenses or outcomes. you know? how are people living? that's how i think we need to make some decisions and that's what we are here to preach. >> so i know you don't like to

be partisan about this. i'm curious. what do you think is the most misunderstood data out there? meaning that the conventional wisdom around some facts, if you will, are one thing, but in truth, once you've actually done the math and work you've done, you say actually that surprises me, different than i imagined. different than what the public may understand? >> i'll pick the economy in many senses. i heard you guys talking about it a minute ago. if you look at the trajectory over time, people can focus on wages. people can focus on family income. but what's really happening, while those things have drifted north, people are paying less taxes today than they used to, and they're receiving more government benefits. it's not hard to see, in a sense, why our deafideficit's occurring but a key driver how

our economy is growing. gdp per capita inflation adjusted. up 2% in the last year proving our economy is vital, productive and doing good stuff. at the same time, people will tell you that it is that it is tougher to support themselves, and i believe that's true, but there's a disconnect in there. >> so, can you, though, get at that disconnect? you're right. polls would suggest that people are very unhappy in today's economy, and it's -- i'm always trying to square the circle, if you will, because the facts, at least from an historical basis, don't always suggest that. but maybe the way people baseline that perspective or view is not against history but is against the immediate history. what do you think is happening? >> i think a lot of it is in two places. number one, it is against immediate history, and number

two, a lot of the benefit people are getting are through reduced tax payments per household and increased benefits, and i don't think people think about that. they think about their paycheck, which i do understand, but they're getting particularly health benefits that they've never gotten. as our population ages, of course, they're getting social security checks that they've never gotten. so, people are benefitting in ways that are not directly tied to family income and wages, which have grown more slowly. >> okay, so, now i got to make it political, though. depending on who you think wins in the white house next november, or this coming november, i should say, the implication for taxes -- you said taxes are -- i don't know if it's an historical low, but remarkably lower than they used to be, and of course, benefits, on the other end, are higher than they used to be. how do you think that changes, and what do you think the american public understands about this? >> i think the american public

probably doesn't think as much about the deficit as people kind of in the know do. they can't see and feel the deficit today. i think people think losing money, so to speak, or having a deficit is not a great thing. i think, you know, you can see -- if i was to equate this to a business situation, i think we have partisans who like to cut prices, i.e. tax rates, and we have partisans who like to increase expenses, especially variable expenses like entitlements, and neither one of those strategy leads to improvement in the deficit, and i am partisan about that. i do think our deficit has grown too big, and that is problematic for our country long-term. >> i mean, steve, you basically said, given where we are, we're getting -- taxes are too low, and we're getting too many benefits. that means you need to raise taxes and cut spending, which

sounds like after all your work, you came to the same conclusion as simpson-bowles. >> i don't think that's wrong. we're not in advocacy of any particular position. we'll show you the numbers, if you will. >> but you got to address both sides. >> my personal bias -- say again? >> you got to attack from both sides, from the -- >> i don't think -- if you look at the structure of the numbers and we do a great job of drawing that out, including on our website, usafacts.org, i recommend people take a look at it. the numbers just won't work for deficit reduction unless people address probably both of those in tandem. >> is there any low-hanging fruit on the list of data in terms of spending that you see that you think if people actually just looked at it, they'd go, okay, this doesn't make sense? >> the real answer to that is, and i'll surprise you, no. i don't think our government is

as inefficient as common wisdom would say. really studying the numbers. you have to decide whether you like what our government's doing. do we like to support less affluent people with health care? do we like to provide the, if you will, the floor, the baseline for seniors? do we really have our tax structures the way you would want them or any citizen would want them relative to needs? i have been very blessed financially. i don't know how much i should pay in taxes. but if you're going to increase taxes, i know i'm one of the people who will definitely see an increase in their tax bill. >> how about your unrealized gains, steve? >> got a lot of unrealized gains. >> how about a wealth tax for you? we could get so much money from you if you really do want to do it. do you want -- probably $2 billion from you. >> yeah, $2 billion is -- well,

a, it's a drop in the government bucket, to be fair, but i don't think wealth tax is administerable. i really don't. by the way, when i pass away, people have plenty of opportunity, government will, to, if you will, tax my wealth through the estate tax. >> we need it now, steve. you look really healthy and young. >> i may look healthy and young, but i don't think the deficit will have reduced significantly enough by my death date. >> as far as l.a. teams, i like yours. >> i want to talk about l.a. teams, but before we do that, i want to talk about jobs and a.i., and i want you to put your a.i. hat on a little bit, given your stake in microsoft and the like. and also, maybe, you could even look through some of the usa facts in terms of where jobs are or aren't or where they're headed in this country, but is a.i., in your mind, right now, overhyped, underhyped? is this going to change the world? is it not going to change the world? what do you think?

>> i think it will change the world tremendously in terms of people's productivity and there will be a remapping of jobs, i think, and wage structure from some industries to others. yet, at the same time, we look at what we're doing with usa facts to collect government data, put it together and publish it. we've seen an enormous increase and expect even more enormous increases in our productivity, which is phenomenal. now, at some point, will that really, then, start driving shifts in where jobs exist and are allocated and what gets paid well? i think so. i mean, it may be surprising, in the sense that there may be an increased value of things that people do with their hands physically, like building a building. we're building a new arena. i think those jobs are more likely to stay around for quite a while than some shifts in

jobs -- >> who is the winner of this? who's going to extract the profit? obviously, you have a massive stake in microsoft. we've been talking all morning about what, you know, apple just announced yesterday, obviously, using openai, which has a partnership with microsoft, and whether this is a, you know, game-changing product, whether it is -- whether all these large language models effectively become commoditized because everyone's going to sort of productize some element of this? >> yeah, i think the pivot point will come, much as it has in past computer waves. who uses the technology best in their applications, and who drives the technology best into its deep infrastructure? in the cloud. and i happen to think microsoft is very well positioned, but there are other companies. >> have you figured out a way these models are going to get monetized? we were talking about how apple is doing this new partnership with openai.

how can that really be monetized? we understood when google was paying apple a fortune, that made sense because it was advertising revenue on the other side of it. it's much more complicated -- i mean, openai has not figured out a "business model" yet, and i don't know who's going to be paying for every time that there's a query from an apple user on to an openai server, which may very well be in azure cloud. >> yeah, i'm not sure how this business model unfolds for apple. i'm not an apple analyst. i see how it is good for people, including some of microsoft's competitors, in terms of providing the core infrastructure, and i see how it can be monetized in terms of value add and the application. and so, it's that interim -- it's that interim group which would include, you know, pcs on the edge or phones, if you will, on the edge. not sure how that's going to monetize at this stage.

>> steve, we're going to have to -- >> maybe less well than in the past. >> we have to run in a moment, but nba rights, the valuation of nba teams, we were talking to josh harris last week, of course, who's got a piece of the 76ers and now owns the commanders, and this whole idea that, you know, sovereign wealth funds and pension funds are all of a sudden going to be buying up sports teams. do you think this is a good idea? >> i think it is not a bad idea, certainly, to open up the ways in which you can finance the purchase of sports teams. i think not only would it help with valuation, but it would also, if you will, stabilize the financings for owners who will still have to buy very large stake for many billions of dollars, but i think it is a good idea. it needs to be done carefully. i like what our league has done, and yet, i think we and other sports leagues are going to have to get creative and think about next steps. >> are you going to miss charles

barkley and the crew on -- in warner media here? >> i have absolutely no comment about that. >> okay, well, i'm going to miss him if, in fact, they don't get the rights. i'm just saying. >> this is an interview i wish we had far more time. >> maybe they'll be on peacock. we'll see. always great to see you, steve. thank you. >> we got to go. join these two tomorrow. "squawk on the street" is next. >> bye. ♪ good wednesday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer and david faber at post nine of the new york stock exchange. futures do pop here as may cpi comes in with a goose egg on headline, below estimates and the lowest monthly print in four years. core is also light. ten-year now at a two-and-a-half-month low and the fed is on deck. our road map begins with that cooler than expected inflation print with the fed's