days are getting shorter. >> stop. >> "squawk box" begins right now. ♪ good morning, everybody. welcome to "squawk box" here on cnbc. we are live from the nasdaq market site in times square. i'm becky quick. this is joe kernen. andrew is off today. it is friday. we are almost there. yes, the days my be getting shorter, but also getting warmer. we will have the lazy, hazy days of summer coming up. it's okay. i can live with the shorter days for now. >> winter is right around the bend. >> you do this. >> friday. it's almost monday. >> don't drag me down that way. i want to enjoy the summer. >> see you in september.

>> enjoy the summer while we have it. >> people are booing in my ear. >> frequently. this is -- look -- >> i want to try to seize the moment. >> yes. >> and just make sure we realize, you know, that life really is pretty short. >> yes. be happy with what we have and where we are. although you will see red arrows when you look at futures this morning. we saw a little bit of give back yesterday. every day, joe, we were talking about it. every day we walk in and there's been momentum and things pushing higher. we below that now. it is a triple witching day today. you could have additional volatility out there. dow futures down 42. s&p futures off 5. the nasdaq down by 22. if you are looking at treasury yields, let's look closely. yields are lower. 4.22 is the ten year.

the two-year is above 4.7%. if you have been watching bitcoin, just at $64,000. it's come down quite a bit, too. over the one year, it is up 112%. crypto related stocks falling this morning. you have seen the nasdaq down as well. >> that's what was so weird. inverse of what we have been seeing with the dow which looked to be close. up 300. s&p closed down 13. not a lot. nasdaq got hit, but it had been going up 140 points every day. >> hit a new high. >> down 140 points. this is all nvidia. nvidia finally backed off. the s&p, that's what people are pointing out -- you can't tell me the third of the gains in the s&p in the past month are due to nvidia. >> it is more closely resembling the nasdaq. all of the gains of the s&p 500 is bringing the nasdaq higher. >> i don't know what nvidia is

worth. it's worth a lot. >> more than $3 trillion. >> let's now than apple and microsoft. it lost a couple of major companies in the market cap yesterday. $240 billion. it can easily gain it. watching the judge at noon yesterday. a lot of those guys, they can't lie. you know, a lot of people have taken profits two months ago, six months ago, a year ago. you can't say no. they said it on tv, some of them. a lot of them have been selling into this varally with nvidia. >> a very small stake. >> druckenmiller. >> he had gone through. watch big gains like that and it is hard not to take a profit on it. let's talk about what we said at the beginning of the

show. sarepta received expanded approval in the u.s. up 33% to include more children with duchenne muscular dystrophy. it expands the market, this does, for sarepta's benefit. the treatment is priced at $3.2 million. i guess, fortunately, you only need it once. it was cleared under accelerated pathway in september. the trial failed to clearly slow the disease, but secondary measures of patient movements was positive. the company filed for expanded approval. i can remember talking about this five years ago. just looking at -- where is david? got a big time geneticist in here. we hadn't seen each other in 45

years. you are not going to come on, are you? >> we were talking about this. this is what we care about. >> i think part of it is one base problem where it the falls off the dna so the gene product is not as long as it should be so it doesn't work for people. >> this is a gene therapy. the reason it is expensive is it is a gene therapy. the first time they are watching approval for this. duchenne muscular dystrophy affects boys more than girls. >> jerry's kids? >> this is pretty rare aspect of muscular dystrophy. these kids die in their 20s. maybe they live to their 30s. yes, the hope is they extended it. they used to die at the age of 16. they extended the life over the last several years. this is a one and done situation

where it hasn't proven they could be more flexible. they do see other signs that are promising. if you can extend life. these kids are going to college and getting married. >> the proof of point. the drug itself is not designed to make the evntire gene. you could eventually designing something that might allow or make the entire -- >> that's gene editing crispr. it is a one and done drug. that's the reason it is expensive. the second most expensive drug on the market right now. this is being watched so closely because it is hope for other rare good evenienetic diseases. if they have a platform with this, they can go after other rare diseases. starboard platform has

blocked autodesk. starboard could not show it would be harmed if the vote went forward without the candidates. starboard said autodesk failed to discloses the internal investigation before the deadline for director c nominations. it said it complied with all federal securities laws and it also noted the internal investigation resulted in no financial reinstatement. it will pursued with the annual meeting. you see autodesk shares are down 1.2%. last month, cnbc reported that amazon was working on an overhaul to alexa. amazon is planning to include some conversational generative

artificial intelligence. two tiers of service is what it is considering and monthly fee of $5 to access the superior version. it could charge as much as $10. amazon dubbed the voice assistant remarkable alexa. >> remarkable? >> remarkable alexa. i was not impressed yesterday. i was asking it questions about certain -- >> with alexa or siri? >> no, just a.i. i won't say which one. asking if this is true. if this is proven. we had the long debate yesterday with obama's guy about climate change. i asked it a few things. all it does is search around. it finds stuff and then presents it as fact. there is no analysis. there's no thinking. again, to me -- >> a web crawler? >> yeah.

garbage in, garbage out. the answers i was getting were -- i don't know. >> you could have scary aspects of a.i. >> i still think it has the ability -- for example, if it was two years ago and you were to ask about the wuhan lab. is it possible that covid came from the lab. two years ago, we were not even allowed to broach the subject. two years ago, you would have gotten no. it has been disproved e. you have the same crap from a.i. that you got from mains stream media at the time. it's the same. it is run by the same people that kept that flfinformation f us a couple of years ago. >> web crawlers existed in the 1990s. they crawl the web for the best information. >> or reddit. goes on reddit and finds some

psycho. we told you the fdic was expected to reject the citigroup living will plan in the event of a catastrophic failure. now the fdic board has rejected the plan in a vote behind closed doors. this appears to concern regulators. the move will be symbolic because the fed is not expected to follow suit in rejecting the living will. business limitations on sdi would kick in if both regulators would agree to the bank plan it is deficient. this story doesn't compare to the lead story in the juournal which we will not mention to

you. in upholding the tax on foreign earnings, it opens the door to taxing unrealized gains. the lead in the journal talks about it. if the court is so conservative, where are the conservatives? five justices with the opinion written bring kavaunaugh. he did not say anything on whether unrealized gains could be taxed. justice barrett wrote the dissent. closed the door. they could have done that. now it will leave it open and a lot of the things that the biden administration were talking about have not been settled. it has to be talked about again. they could have said something yesterday. didn't do it. now the narrow rule on being able to tax foreign investments that maybe were not sold. it is similar. >> i'm sure we will hear it

again. this will rise again. >> you know who we will talk to ab about? >> who? >> j.b. jared bernstein. they are dying to tax unrealized gains that elon musk has and jeff bezos has. >> if you are using the unrealized gains -- >> yeah. it seems in general. you have property taxes which are similar. >> yeah. to me, property tax is a use fee. you pay to live in the town. you pay to use the schools and police and fire departments and all those things that come along with it. >> it's not really -- i guess you are taxing the worth anytime. it is not the same as taxing all your nvidia shares we will which talk about. >> home prices don't move in the same fluctuations. >> if you pay capital gains on

netflix at $700 a share and then $180 the next year, you would be mad you paid all of the capital gains. >> you will use it. >> you can ask the irs to give it back. >> the court will have to weigh in on this. when we come back, nvidia shares were down yesterday turning negative for the week. we will talk a.i. stocks right after this break. later, new york governor hochul will join us. "squawk box" will be right back.

hello. i'm ethereum. and i'm big finance. you look really tired. just calling it a day. but it's 4 p.m. yeah, and i've been working nonstop since 9:30 this morning, so. 9:30. you don't say? yep. you'd want a little shut-eye too if you'd been moving billions around the world. well, actually, i do. you know, stablecoins, nfts, loans. people can access me 24/7. what? but look, everyone's different. you should get your rest. you'll get after it tomorrow. tomorrow's saturday. [ethereum] monday. you'll get after it again on monday. did i read this? did i get eggs? where are my keys? memory and thinking issues keep piling up?

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for ultimate business. and it's all from comcast business. welcome back, everybody. as we mentioned, shares of nvidia falling yesterday and dragged down the other technology stocks with it. the chipmaker is up 160% so far this year. joining us to talk morarkets an a.i. sector, we bring in the co-founder of toggle a.i. it uses machine learning to turn data into insights for investors. jan, thank you for being here. >> thank you for having me. >> we were talking about a.i. and is it more than garbage in and garbage out. talk about how you use it. >> it is a fine line. we built toggle terminal that is in use by a number of hedge

funds. the key component of it is what we call a knowledge graph which is fed by the generative a.i. models. you are learning about relationships that matter with nvidia and interest rates and so on. that's where you need large amounts of data. you need to control it tightly. >> control it tightly meaning what? >> we need to know. we only gave it access to data that we know is high level of integrity. it doesn't randomly pick it. >> you don't have a large language model out on the planet? maybe more useful with the smaller scales? >> it is establishing on data you have faith in. if it is looking and learning, it the will look at data and cpi

data only from trusted sources. tho not just what you find on the web. >> what have you learned? >> one thing we discovered is there is a lot of insight in the data. the data we use every day that would have gone undiscovered because you can process at scale. you are able to decline a particular security and how it impacts price action going forward way before it actually happens or how that combines with the overall macro environment with the economy slowing. this gives you a more complete picture with what you can see the next few days and weeks. >> what do you think of the a.i. stocks in general? we were talking about the huge run up and pull back this week. what are you seeing when you see the trends? >> to me, it is looking from inside out and looking at how

few actual commercial applications we have had with this technology. i think the infrastructure still has a long way to go. i look at nvidia and cloud computing and it feels like we're trying to do streaming in the mid 1990s where the infrastructure wasn't ready to take advantage of it. i think there will be a lot more demand for all of this. >> you are talking back 20 years. how quickly is that str infrastructure going to be built up? >> you are seeing the demand, obviously, for chips. you will see a lot more demand for compute. a lot of the applications will be used by large financial institutions and hedge funds. i think demand for that will absolutely sky rocket. >> is this going be an a serious edge to trading? will it almost make the markets more uneven for retail traders

who don't have access to it? >> it's a good question. i think the way we think about it around the toggle terminal, if you were the first person ever to get a bloomberg te terminal, you felt you had an edge. the same thing will happen here. it will become natural to have it. it is a great productivity booster. you will feel -- it is like not having access to google search. >> with toggle and the a.i. you are using, what do you see in terms of where the market stands with the fed and when rate cuts are coming? >> crystal ball. >> what do you have that everybody else we talk to may not? >> what we're focused on is market breadth which other people are focused on as well. what we're seeing is because the economy remains actually in really good shape, you should expect a broadening of the rally

as shrinking it. the way to look at it is there are a lot of other stocks like russell 2000 which is basically flat on the year, although the macroeconomics picture, it looks really good. sure, the fed is not cutting rates aggressively, but so long as inflation doesn't turn up which is the second thing we're focusing on, i think you're actually in a good space. >> jan, thank you for coming in today. we know you are right here. if anything else happens, let us know. >> thank you very much. coming up, high performance automaker betting big on ev. robert frank is in italy this morning. robert, what's coming up? >> good morning, joe. this is the building where it all started. enzo ferrari built cars to fund

wr his race team. today marks a big chapter. we are live from maranillo, italy, coming up. you are bountiful. your bones can support two times your weight. it's in your nature to stand strong. your cells renew every 27 days. it's in your nature to glow. your digestion can improve by laughing with friends. it's in your nature to thrive.

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let's get to work. idris elba works here? mm-hmm. ya, he's super nice. welcome back. robert frank is in italy this morning with a closer look at a high performance automaker that's betting big on evs. i just read something in the taxicab, about bugatti. if you can tell me why somebody needs to go 300 miles an hour -- >> ferrari looks like a bargain

next to that car, joe. this is the factory where ferrari started to build cars in 1943. they will launch a new factory to build the all-electric ferrari. that model won't launch until the end of next year. until then, that factory will build hybrid and electric cars. they only built 14,000 ferraris last year. waiting list is three years. the hope from dealers and customers is the factory could add tro production. the ceo says they see no slowdown in demand, especially in the u.s. >> what we see is a good, healthy demand in different countries. the order book is going well into 2026. u.s. is our biggest market.

it's around 30%. there is no sign of change. >> that demand helping the ferrari stock up 27% next year. the market cap of ferrari is now 1.5 times that of ford or gm. they make millions of cars a year. ferrari makes 14,000. the dollar profit on a ferrari is $120,000. joe, you need to sell five porsches or 16 bmws for a profit on a single ferrari. >> that's a good business to be in, robert. what's the range? there is a starter ferrari that i've actually looked at. it's a pretty cool car. what is that? about 250? >> yes. the starter ferrari is now well into the 200s. where they are making profits

and they don't need to increase production, and don't grow profits is because of the personalization. most customers don't just get the standard retail price ferrari. they are adding up to $200,000 in options and releasing expensive models. a lot of the models are 400,000 and 500,000 plus. >> while you were there, can you go to the bugatti? it is a $4 million v-18. >> joe, what is interesting about that is that this is the first launch since bugatti has been owned by the electric vehicle company. the assumption was bugatti would be an electric super car. they were being more primal and

going back to the 16 cylinder engine and pair it with a hybrid. you get 1,800 horsepower in the car. in the auto world, there is not much demand as evs as people thought. we will talk with the ceo of ferrari if anyone wants an electric ferrari and what it would be like. can you make a ferrari a true ferrari and be an electric vehicle? >> christopher nolan wants one. he will want some royalties on that thing. christian bale is going to step out of that, i think. i don't think i like it that much. do you? it's weird looking. nutty. i'm happy. i'm happy where i am. driving round in a cherokee. six cylinder. thank you. the jeep commander sucking up the hydro carbons.

thanks, robert frank. when we come back, new campaign finance disclosures are out and they reveal one of the biggest political gifts ever disclosed from a reclusive billionaire to former president trump. we have details on that story next. right now, as we head to break, let's look at yesterday's s&p 500 winners and losers. okay, team! oh, thank you so much i couldn't have done it without you. honestly, i don't do a whole lot here. i'm really just here for the at&t internet, it's super-fast so, any pre-launch concerns? what if nobody buys them? that's mean or, what if everybody buys them? oh, i hadn't thought of that that's probably not gonna happen can we handle that kind of traffic? the network can handle it! i downloaded eight hours of true crime stories just during our last video call i'm learning a lot

good morning, everybody. welcome back to squawk box." we are live at the nasdaq market site in times square. futures on this friday morning are looking a bit grimmer. dow futures are down 60 points. s&p futures off 10. nasdaq off 8. not a big surprise. every day we come in, futures are in the green. joe biden's re-election campaign raised $85 million. that's the second best month for fundraising. it falls short of -- i said one day. we'll get that cleared up.

141 -- what's that? oh, in may. okay. raised by former president trump. let's bring in washington reporter megan cassella. i guess that wasn't the lead. the $85 million. $141 million after the conviction? conviction with quotation marks? >> absolutely. 141 million was for the month of may. more than one-third came in 48 hours after the verdict on may 30th. those came in may 31st. the biden campaign says $85 million. they are spinning this as impressive. the second best month ever. they are building a grassroots campaign. the dynamics with the fundraising is shifting here, joe, when biden's primary advantage so far has been cash. now, obviously, he is far out

raised for the past two months by the trump campaign. >> did you -- do we know the running totals at this point? >> for cash on hand, the biden campaign reported $212 the million in the bank. the trump campaign had been far behind in cash on hand. did the not report that figure. they didn't have to for the monthly. they will have to next month when it is a quarterly deadline. the new york times did the tallying. they think they have at least $170 million in the bank. still behind, but cut the deficit to the campaign in two months time. clearly, they both have money and they are starting to spend, joe. >> i have seen it pointed out, megan, in 2020, trump didn't have as much money or didn't spend as much money back then. he lost, obviously, but it might

not be necessarily the way you gauge how well a campaign is going. he didn't use as much money, did he? >> that's right. there's a lot of thinking here. at the presidential level, candidates in the modern era haves always had enough money to run campaigns. on one hand, does it matter who has even tens of millions more as long as they are running extensive operations. trump has run leaner campaigns. he doesn't lean on the ground game operation that biden and more traditional establishment candidates have with offices in swing states and major ad spending. talking to his campaign this week, his officials say he is the best asset. he can do the off-the-cuff rallies. that is the way to have the candidate out there rather than doing the process stuff as they called it to me. yes, they can run a leaner operation. the flip side of that, though,

especially in this election, when those fringe voters, the ones who may be disengaged, in swing states, are the ones who matter. there is thinking that ad spend matters. that's where you want to spend as much and out spend your candidate to get people to the polls and engage them and keep them interested in the campaign. >> yeah. i just hope they spend it all on ads that i see on tv, you know? with all of the local ad spending. i can't get enough of it, really? can you? have you ever seen the same commercial runs one after another. a pro commercial runs and right after that, you know, your mother -- >> it is all about balance. you want to hear them both. those definitely are coming. those are coming. someone told me yesterday, you don't want that before september. joe, i want to mention the other

thing we learned yesterday beside the totals with the mega donors. tim mellon gave $50 million to the trump campaign. he got mega donors who gave him $10 the$10 million. the winklevoss twins gave $1 the mil million. we saw me linda french gates give here. we saw the wave of the mega donor filings. >> she's got some money. we call the winklevoss twins the winklevi. i love that in bitcoin. $1 million each. it is worth 6$600,000. i'm kidding.

it's fine. thanks, megan cassella. all right. when we come back, michelle cab caruso cabrera will join us. next week, we will bring you the aspen ideas festival with san francisco fed president mary daly. "squawk box" will be right back. before you use ai to transform business, accelerate growth,

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the european union reprimanded france this week for overspending which could lead to hefty fines and challenges before the country's legislative elections. joining us now is michelle caruso-cabrera. she is a cnbc contributor. you! yeah, you are a cnbc cont

contributor. how are you doing, michelle? mcc. >> good. how are you? >> i'm hanging in there. i don't know where to start. i'd like to start with whether the possibility of this not being around in ten years has become -- i see what marine le pen has done. >> the eu? >> in general. that's not going to happen. those were so weird elections we had, weren't they? >> yeah. last time i covered the french election for you guys in 2015, that was one of the discussions about how there was a party in france that very much wanted to leave the eu and abandon the euro. they've since dropped that. that is no longer any party in europe really talking about that. the european project, i think, at this point still feels very much like it is holding

together. the current situation, i don't want to call it a crisis where we see the french stock market the fall dramatically and french bond yields rise because of the upcoming election. still, you are talking about a ten-year yield of 3% for france. it's not quite crisis. it's higher than germany. it reflects the fact that investors are concerned about the spending levels in france, which are very high, too high, and an election that's coming up that's surprised everyone and likely to lead to more spending, not less. that's the drama they face. leaving the eu and euro is not in the cards. at least not right now. >> obviously, the whole issue of putin and ukraine and energy still looms large because the continent, deindustrialized and outsourced its most basic industrial needs. how do you fix that? how long does it take?

>> yeah, well, germany abandoned nuclear power. they can reverse that if they wanted to and they would have more reliable power as well. >> how long would that take? >> yes, but that could be a decision they make. they've made a lot of decisions. you can't help but feel bad for europe. if you go back to 2008, the u.s. economy and the european economy were the same size. $14 trillion. now, fast forward to 2021, the most recent data we have out of the european union, and the european union's economy is now roughly $15 trillion. whereas the u.s. economy, in 2021 was $24 the trillion. europe doesn't grow. they don't grow because of the issues you raised, joe, and the choices they made about energy.

they have an attitude that is very different than the united states in terms of the way they see the role of government, et cetera. very confusing. in france, you hear about the far right and the far left. when you look at their economic policies, they are actually both about spending more. so, the most conservative economic party in europe would be one that isquivalent of the biden administration. there is more expectation of intervention and regulation and subsidies, et cetera. it holds them back. they think about regulation more than they think about growth. >> we have a clear choice here about how much these two candidates spent in their respective presidencies. >> there's been a merge in the united states. i don't disagree there. yeah. >> and they have such stark differences on tariffs and the like. what's going to happen with

macron? do we know for sure? >> so, the election that's coming up in france equal to our midterms. he's not on the ticket. different than the united states is if there is a bad outcome, he could step down and call an early election. he has insisted that is not going to happen. he is going to stay in power for the full term in 2027. he will have a prime minister who could be in the opposition which would make it very difficult for him to do more reforms that would help the deficit in france, but so far, he says he is staying no matter what although the polls suggest his party is going to do very, very poorly. >> you know what? i think it's time for a look-see in that country for "squawk box," becky. >> are you coming to par sispar?

>> i think we're going to come over in late july. >> the olympics is going to be fantastic. >> we want to. we're very excited. >> i'm already wearing red, white and blue. >> you should be. it's going to be great. >> you need a -- i think you need one of those badges like an electronic badge to walk anywhere to get anywhere on the streets. to get in certain areas. >> here's what you will love about it. unlike an asian olympics, you will have a decent day. you don't have to get up early. you can go to events at night. >> noon to 3:00 is not bad. the french are good at security, too? >> and food. >> and food. i know that. you know, davos, there's one way in and one way out. no one can get in there. anybody that looks suspicious. france? they are already there. we're going. i'm not afraid.

>> i'm excited. >> it's sort of an afraid excitement. exciting afraid. okay. good. >> thank you, michelle. >> good company man. >> or woman. >> or person. when we come back, days without their computer systems after a second cyberattack hit a key software provider that so many of these dealerships use. we have got the tas ghdeilrit after this break. "squawk box" will be right back. [ inner monologue ] i needed some help. good thing i knew someone...

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auto retailers across the united states and canada could be facing days of software outages following back-to-back

cyberattacks this week on cdk global. they have more than 15,000 dealership customers in north america according to automotive news. dealerships across the country reverted to using pen and paper to process repairs and vehicle sales this week. after systems were initially restored on wednesday, the company said that it suffered an additional cyber incident and proactively shut down most of the systems once again. axios is reporting that cdk told customers last night it did not have an estimated time frame for resolution and that the dealer systems would likely not be available for several days, but, joe, first of all, it hits at a really bad time, over the holidays, when they have a lot of auto sales and hope that they can get a lot of customers that are coming in. so juneteenth was a day they were targeting. and i think it also looks at how the cyberattackers are looking for weaknesses that can affect entire industries, things we don't think about. i didn't realize there was a software company that dealt with most of the auto dealers. i didn't realize the healthcare

provider, remember, that was -- that everybody across the -- all of these multiple -- >> united health? >> they were using the same software for -- united health subsidiary, using software across all the hospitals and hospitals couldn't process anything or check your insurance to see your availability, if you were able to get some of these procedures. >> we are really dependent on a lot of things that may not always be as stable -- >> as robust as we think. >> the security of them. when your jgps goes down, i hav to stop. >> that this town, it is okay. it is grid-like. it is when you're out and about. >> the panic -- it is just taking a little while that things go like this and you're, like, do i turn, where am i missing an exit? coming up, fallout from the

tight housing market. a staying put and facing rent hikes. "squawk box" will be right back. okay, team! oh, thank you so much i couldn't have done it without you. honestly, i don't do a whole lot here. i'm really just here for the at&t internet, it's super-fast so, any pre-launch concerns? what if nobody buys them? that's mean or, what if everybody buys them? oh, i hadn't thought of that that's probably not gonna happen can we handle that kind of traffic? the network can handle it! i downloaded eight hours of true crime stories just during our last video call i'm learning a lot i can't believe you corporate types are still at it. just stop calling each other rock stars. and using workday to put finance and h.r. on one platform. tim, you are a rock star. using responsible ai doesn't make you a rock star. it kinda does. you are not rock stars.

(clears throat) okay. most of you are not rock stars. oooh. data driven insights, and large language models. oh, that's so rock roll. it is, right. he gets it. yeah. hello. i'm ethereum. and i'm big finance. you look really tired. just calling it a day. but it's 4 p.m. yeah, and i've been working nonstop since 9:30 this morning, so. 9:30. you don't say? yep. you'd want a little shut-eye too if you'd been moving billions around the world. well, actually, i do. you know, stablecoins, nfts, loans. people can access me 24/7. what? but look, everyone's different. you should get your rest. you'll get after it tomorrow. tomorrow's saturday. [ethereum] monday. you'll get after it again on monday.

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all words you want from your bank. for nearly 160 years, pnc bank has been brilliantly boring so you can be happily fulfilled... which is pretty un-boring if you think about it. welcome back, everybody. the tight housing sales market has meant that many renters are staying put, leading to price hikes for rent and complicating the overall inflation picture. joining us right now is igor popov, apartment list chief economist. good morning. thank you for being with us. >> good morning, becky. happy to be here. >> let's talk a little bit about this situation. we know the housing market has been really difficult, there has

not been supply, that means people can't find houses to buy, that means they stay in their apartments and that means that those rents have gone up because there is so much demand. what are you seeing right now nationwide? >> yeah, absolutely. the rents are up over 20% suinc the start of 2020. the market has been on a roller coaster since the start of the pandemic really. typical year rents grow maybe 3%, but we saw rent declines in 2020. skyrocketing rents in 2021 as we saw an explosion of housing demand, tight supply and a real cooling housing market coming on the back half of 2022 with rate hikes and cooling consumer confidence. so that brings us to today. so, nationally we're tracking rents to be roughly flat, down a little bit, year on year from last may. but it really depends on where you are in the country. we're seeing a lot of regional divergence. we have some cool markets in the

sun belt that are seeing rent drops, but if you're a renter in the northeast or the midwest, you're seeing some pretty strong rent growth this summer. so, renters experience of the housing market and rental market in particular really depends on where they are right now and one of the big drivers is really regional differences and construction right now. >> okay. so, where there is additional construction, you don't have as much pressure on rent because there is new supply that is coming on? >> absolutely. there is actually -- that's good news for renters. there is a lot of new supply coming on. a couple of years ago, when housing demand was booming, interest rates were low, there was a pretty ripe time for developers to get in on new projects. but those projects have taken a while to hit the market. we actually entered the year with a million multifamily units under construction, which was a u.s. record. and that's hitting the market now, but it is not evenly distributed. a place like austin, texas, is permitting ten times as much new housing per capita as a metro

like cleveland or chicago. and that's really driving the differences that we're seeing. rents in austin are down 7%. places like chicago, providence, cleveland, milwaukee, are seeing 3 plus percent rent growth this summer as we enter a peak moving and leasing season. >> let's talk about what this means just in terms of the inflation picture because the cpi looks at rent a little bit differently. how does it measure it? >> right, so, there is really two different stories when we look at market rents and the average rents that americans are paying, which is really how we measure rent for the purposes of tracking inflation. so, market rents move quickly, they can turn on a dime, the rents that average americans are paying, they move slowly because most folks are locked into 12-month leases, and as a result, the cpi -- the rent measurements that factor into the consumer price index, they lag what we see in the market by really over a year. and so, cpi rents are really a

shadow of market rents. they're still tracking the deceleration that we were seeing last year in rent growth. and so, this creates a pretty tough picture for the federal reserve because i think there is a feeling that the housing market has already cooled significantly from rate hikes, but we don't really get the full score card until cpi rents catch up to the market and they're cooling in the cpi, but it is going down very slowly. it is like watching paint dry and we keep waiting for the cpi rents to come down. they're coming down, but very slowly. and what we're seeing now in the market, we're seeing a new rebound and new rebound in demand across the country, that, again, is going to factor into cpi rents four to six quarters down the line. i think the bigger concern is that as rents stay higher for longer, now we're actually seeing suppressed construction, which is ultimately the big story for the housing market over the long run is can we get enough housing units on to the

market to give renters some relief. >> right, right. we need more supply. igor, thank you. >> thank you so much. it is just after 7:00 a.m. on the east coast. you are watching "squawk box" right here on cnbc. i'm becky quick along with joe kernen. among today's top stories, delta airlines is raising its quarterly dividend by 50% to 15 cents a share. the payout represents an annual yield of 1.2%, based on yesterday's closing price. delta reinstated its dividend last june at 10 cents a share after suspending the payments during the pandemic. starboard value has lost a legal battle to block autodesk from holding a board vote next month. a delaware chancery court judge said that starboard couldn't show it that it would be harmed if the vote went forward without its candidates. starboard says autodesk executives failed to properly disclose an internal investigation before the deadline for director

nominations. autodesk argued that starboard in its words missed the deadline and said it complied with all federal securities laws. a major deal may be in the works in the casino business. reports say boyd gaming has approached penn entertainment about an acquisition. they would have to win support of disney, which operates the espn bet service with penn. >> a lot of betting services out there. i see them all advertised. checking the futures right now, why? >> because that's what we do at this time. >> well -- >> it changed. i guess the -- >> say something interesting about that. >> the news here we're moving towards improvement. you actually see flat lines for both the s&p 500 and the nasdaq. the last time we looked at it -- >> you came down from a different planet and someone said, tell me about the futures, you would say what? >> and here's the good news. we have moved into positive territory across the board with all three of the major averages after being down lower this

morning. >> not buying it. let's get to frank holland has some interesting things. there are individual movers. save us. >> i think becky did a great explanation. futures are moving higher. in the red earlier. i digress. we'll move on. we're watching shares of trump media technology, this is getting your attention, you can see it is up almost 1%, trying to regain the lost ground from yesterday. and also pretty rough week for the stock. the stock has been sliding already this week. yesterday, down about 15%. so the stock as you can see on this chart, it is falling just about 50% since former president trump's criminal conviction in new york last month. again, trying to regain some ground this morning. up just about 1%. we're also watching another big mover this morning, we're talking sarepta therapeutics, surging 40% ahead of the open, news announced after the bell, you see the sharp move to the upside. so, the news was the fda approved the expansion of access, allowing more people to use the gene therapy to treat a

rare muscle disease. the treatment for this disease, it costs $3.2 million per patient. shares up more than 40% right now. and also we're looking at ferrari. ferrari, i saw you earlier today, a new look at the ev factory and the new electric model with the price tag of over $500,000. that's a base model without all those extras that can typically add 15% to 20% to the cost. there is also a second model being planned and the new factory is expected to help the italian luxury automaker increase production. you can see it right here, ferrari stock year to date up almost 23%, having a very good year. the luxury sector in europe having a strong year overall. joe, back over to you. >> still grappling with ferrari ev, ferrari -- to go 300 miles an hour, frank. it should -- should be wings. right? that's fast enough.

>> that about the bugatti, $4 million car, great -- >> 300 miles an hour. but it needs -- why not have wings that can -- >> where would you drive that in the new york city area? i don't think you could even do that. >> nevada. >> in your cul-de-sac? what are you going to do? >> autobahn. you don't want to go 300 miles an hour. >> you can't -- you can't go that much faster than traffic anywhere. won't even allow that. >> there is some nasty -- ever crash on the autobahn going 200, 300, you know, that's the last crash you're going to have. >> i would be in the right-hand lane. >> you would. when we come back, council of economic advisers chairman jared bernstein will join us to talk about inflation pressure and what the biden administration is doing to reduce costs for the american consumer. and later, "the wall street journal's" greg ep will join us on what the far right's possible victory in france could mean for the eurozone economy. "squawk box" will be right back.

all right, welcome back, everybody. joining us right now to talk markets and some of the data we got this week, barry knapp, ironside's macro economics director of research. barry, where do you want to start with this? we got a lot of new retail sales that have come in. you had initial and continuing jobless claims, housing starts. what are things starting to shape up like? >> all year there has been for me two different scenarios where we could have a fairly significant drawdown in equities, 10%, let's say. one would be that we retest 5%

and have a real rate shock and threaten that month and a half or so ago, late april. the other one is we get a significant growth scare. some will -- i talk to clients about the growth scare dynamics, real deceleration of growth, often you get the pushback that i'll get will be, well, we'll look through that, the fed rate cuts and the market will ignore it. i'm less convinced that would be the case and i do think the evidence of a growth scare is starting to build. doesn't make me wildly bearish. i don't think we'll -- it is likely we go into a recession, which would cause a deeper pullback, 20 plus percent. if you think about the data that you're talking about, first, with respect to the labor market, there is this huge debate under way, i've been calling it the tale of two surveys, the household survey, and the quarterly census on employment and wages implies we probably had a million less jobs

last year than we originally estimated from the establishment survey, that uptick in the unemployment rate, the drop in job openings, all the things chair powell cited at the last press conference implied the labor market is much weaker because of small business employment. the idea that -- which we don't measure very well. and the idea that credit and rising rates that don't affect large corporates that were able to turn out their debt, but that hit small business. you add to that, as you mentioned, retail sales, which through the first two months of the quarter are basically zero. and the starting point was a little lower because march has been revised down twice now. the housing data has taken a turn back lower as well, as has the manufacturing data, all the pmis overnight looked decidedly weak and then within the equity market, which, for me, it takes about three months of

performance, persistent performance to be convinced the equity market is sending a real efficacious or meaningful economic signal, but i've been calling this an unhealthy broadening out. what was weakness in consumer discretionary small caps, small banks, has now broadened out to energy, materials and industrials and this is the quarter where the earnings are supposed to accelerate. the second -- the first quarter earnings grew 8.3, that was entirely attributable to tech and communication services. this quarter, those other sectors are supposed to increase by something like 7.7%. there is no reason to believe that it won't happen, but other than all this macro data and the price performance, so this is really sort of put up and shut up time for that broadening out that everyone expected this year. and it is really quite questionable. >> barry, i hate to interrupt, but i want to bring your

attention to the fair value board. we're now looking at futures in the red. nasdaq has indicated down by 10 points. the s&p futures are indicated off by 2.5. joe's not listening to me, even though this is for him. the dow is indicated down by almost 10 points. >> you're hanging your hat on that it turned positive. >> i am making a big deal of the fact it has -- >> save your excitement for when it really is true. when you do something really true, it cheapens -- >> fair enough. what i will say is, barry, you seem surprised we haven't seen a big pullback. we're marching higher and higher and higher and it sounds like you think doesn't make a whole lot of sense and you sound a little nervous. >> i think the tech part of the story makes sense. the last time i was in new york, i sat down, had lunch with my former neighbor and buddy dan ives and i get the whole gen

a.i. investment boom story. we were supposed to broaden out and have the rest of the market perform better this year. i've been positioned for that. i got overweights in industrials and energy and they just haven't been performing. so that's making me a little bit nervous, i would say. >> barry, i wanted to talk to you about the cbo, but we're out of time right now. please come back. because i want to dig a little more into the numbers. quickly, you pointed out that the revenue line since world war ii really has only been 17%, 18% overseas. >> you nailed that yesterday. joe called that out straightaway. the only two years we went above 19% followed stock market booms. it was 2001 and 2022 after absolute booms in the market. so, the only way to really fix that revenue line to get that number higher would be a complete restructuring of our tax code, something like a national sales tax. otherwise, the problem is spending. that was the problem in the '60s

that drove the inflation, the great inflation and we have the same problem again. so, you know, it is fixed spending or bust, so to speak. >> it seems as plain as the nose on your face. i looked all the way back. and roger was right that during the clinton years it was, i think, 19%. but the long-term average is 17.5% and we used to spend under 20. and we're at 24. so we're going to stay at 24. so, if you're right at the long-term average for revenue at 17.5 and you're 4 percentage points on spending, how can it not be clear what the problem is, barry? >> i don't know, joe. i find that fascinating. every time someone comes on your air and says otherwise because clearly spending is indigenous to growth.

we have 17.5% -- we had a marginal rate of 28% under reagan and got 17.5. that's what we can collect under an income tax structure. the spending side is clearly exogenous. there is no way to close the gap. >> you're giving grist to both sides there. people think if you go -- if you cut taxes, you can go above 17.5. you're saying higher or lower, you still get 17.5. the government -- it is the age old argument, the government thinks that when it spends, it is investing. the government is the worst investor in the world, but at least -- let's say they do know how -- let's say they are trying to invest for future growth. what about the private sector? can they invest for -- why doesn't less money being spent on taxes bring greater growth in the private sector, barry? you said it doesn't. >> let's just think about it,

simply in terms of the costs that get born. in 1965, 25% of the population over the age of 65 had healthcare insurance. we started medicare. we had a market failing, we started medicare. well, healthcare inflation went from 2.5% in '64, 7.5% by '66. we all paid for that expansion of healthcare. that started the great inflation. it then spread to housing, and every other sector. so, whether the investment makes sense from a social perspective or whatever, or not, there is going to be a cost associated with that. and ultimately that cost will be borne by the public and it is through inflation more often than not. that's what we're looking at again. we want to make the energy transition, we want to have a billion dollars in subsidies for green energy investment over the next decade, it is going to cost us. and that's the bottom line. >> so weird that you're still

skiing in june. is that not live? >> not this weekend, joe. there is a little bit of snow at the top. >> is there really? how much is a lift ticket now, speaking of inflation? is it over $200? >> way over. but you can buy the epic pass for 1,000 bucks and it is unlimited skiing, so, for me, 45 days -- >> how much is a daily lift? $300? >> not quite. i don't know because i buy the epic pass for 900 something dollars and that's my season of skiing. >> it is a great mountain. thanks, barry. up next, council of economic advisers chair jared bernstein is our guest. we're going to talk about president biden's message on inflation. but really want to talk to him about that piece yesterday and what we were just talking about now, and how anybody can try to break this cycle of just more and more debt and how are we

going to do it. we'll be right back. >> announcer: time now for today's aflac trivia question. the vacuum flask, which was invented in 1892, later became known as the world's first stainless steel vacuum bottle known as what brand name? the answer when "squawk box" returns. oh, charades! - okay! - love it! umm... first word. - tonsillitis! - nostril! uh-uh... bill! uh-huh... - hip-hop! - limping! mmhmm! medical bills! uh-huh! - pancakes! - cash! who pays you cash when you have medical bills? grrr! no idea. [tapping] gap! the gap left by health insurance? who pays cash to help close that gap? aflac! oh, aflac! get help with expenses health insurance doesn't cover at aflac.com pictionary?!

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>> announcer: and now the answer to today's aflac trivia question. the vacuum flask, which was invented in 1892, later became known as the world's first stainless steel vacuum bottle known as what brand name? the answer, thermos. inflation remains a top concern among voters. but according to white house council of economic advisers consumers are starting to see some relief at the grocery store. joining us now is the chair of the council of economic advisers, jared bernstein. hey, jared. how are you? >> hey, good to see you. >> good to see you. the relief is coming from prices not rising as quickly. but the big price rises are already in for a lot of things. i saw a list the other day of

things and just how much more that they do cost. so people still feel it, if you're mid to lower and even higher income people, you do notice eggs or meats and certain things that are more than they were. it is progress that the prices aren't rising as much. i don't know if they ever go down to previous levels. do you? >> first of all, let's start by agreeing firmly on the point you just made. look, prices are too high and too many families are being squeezed by the cost of living. this is something the president talks about every time he leans into that. and that's why we're taking aggressive action to lower costs. i'll talk about that in a second. we just released a new website, white house.gov to go through all the areas in which we're trying to do that. and we're having some success in ways i'll explain in a moment. but there are some groceries that have come down. if you look at the piece you're talking about, we posted on the

cea blog yesterday, there is about 15 items that we found where prices are actually coming down. so it is not just disinflation, which is, you know, really very significant. we're growing 1% before the pandemic. they got up to double digits, they're back down to around 1% in terms of grocery inflation. we have seen some deflation, so lower prices in that sector as well. >> any progress is good. on the bigger -- on the bigger issue, and i don't know whether you would concede that maybe spending can hurt inflation, it was obviously it was a post pandemic and supply chain and i know the president likes it blame it on corporate greed, things like that. i don't know how that makes sense because corporations for 40 years would have been raising prices if they could, just willy-nilly. but you know what i mean.

the 40-year highs, it is more than just price gouging. my question is about the -- what we're spending, the deficit, which that was not a good number yesterday. i think you know that. near 2 trillion. 7% of gdp, that's way too much. why are we spending so much in a growing economy? why is the deficit at 7%? it never has been run when the economy is in a boom period like that. >> so, let's unpack a lot of what you just said because you started out with inflation and prices and that's a key part of our focus right now. again, too many families are struggling with prices that are too high. we have to aggressively attack that and i'll speak about that in a minute and get to the point, i disagree with part of the conversation you had with the guy with the season pass there. >> barry knapp. >> barry knapp, yeah. so, the skier, right. so, first of all, it is a mistake to look only at the inflation side of the ledger.

look, as you see, we look very carefully at that side of the ledger, and we talked about prices, we talked about lower inflation. you also look at wages and income. wages are beating prices. for middle wage workers, wages have been beating prices for about 15 months in a row. you look at disposable income, after tax income, it is up $3700 since before the pandemic. so let's be careful not to look at just one side of the ledger. let's look at both, the fact that real wages and incomes are rising means people have more buying power. at the same time, we're cutting insurance premiums by $800 for nearly -- i think what is it -- millions of americans by lowering i think about 15% or 16 million americans by lowering the premium tax credits, capping prescription drug costs for 4 million seniors and so on. in terms the fiscal outlook, the

thing i disagree with barry is this idea that somehow cutting taxes doesn't have any fiscal impact. i think you and i probably have disagreed en this, joe, for a long time. it is not just some act of nature that when you cut taxes, you end up with less revenue. that's a failure of trickle down and i know we argued about this, i doubt we're going to agree today. i think the record is very strong on that. it comes to spending, yes, we're trying to cut spending and being quite successful particularly in the area of healthcare. all the things i just ticked through, allowing medicare to bargain for lower prescription drug costs, that actually saves consumers and helps the budget. so that's a two-for. >> are you saying that disposable income inflation adjusted is above where it was before president -- i think it is still below, is it not? >> i'm talking about if you look prepandemic, so i went from december -- december 2019 to

now, inflation adjusted disposable income up $3700. we're about to release something that shows that number. you'll see that in front of you pretty soon. >> one of the points barry was making was that the amount of revenue at 17.5% or 18%, whatever you want to get, that's been pretty consistent. why do we keep adding to -- we had elizabeth warren on, she has no -- when i ask her, would you commit any of the -- if you did have unrealized gains, a wealth tax, if you raised taxes on corporations, if you raise capital gains, would any of that be earmarked, you know, for deficit reduction or debt reduction? and that didn't even cross her mind. willing to spend 24% of -- >> let's talk about -- >> year after year, we used to spend 19 and get 17.5. now we're getting 17.5 and spending 24. why do we keep doing that?

it is insanity. knowing it is wrong and continuing to do it. >> i actually agree with part of what you're saying there. when you're in a hole, stop digging. that's why this president's budget reduces the deficit by $3 trillion over ten years. we have a very detailed plan, written down, to do exactly that. if you look at what the opposition wants to do, it looks to us like just the opposite. dig that hole deeper by fully extending the tax cuts that expire at the end of next year. president's talked about extending those for families below $400,000 because of the pledge, not to raise taxes on them. allowing the tax cuts to expire above $400,000 so the wealthy and rich corporations pay their fair share. now, that is deficit reducing, where as a full extension would obviously go the other way. now, look, the other thing we have to do, you're right, we have to hit both sides of the

equation. when you cap prescription drug costs at $2,000 a year, not only are you helping 54 million seniors and lots of other medicare beneficiaries, but you're saving hundreds of billions on the budget. that is a really effective way to both cut spending, help the budget, and along with that, the president's fair tax agenda, which, by the way, there is another piece of that, which gets under my skin. republicans have consistently -- republicans have consistently cut funding to the irs. this is a shadow tax cut for tax invaders. and it is a way to lose hundreds of billions by allowing millionaires and billionaires to evade taxes. >> i'm not going to argue with you about cutting funding to the irs. we have seen that when you increase funding, you do get back even more money in the income that comes in. however, the plans where you talk about cutting the deficit, biden's plan intentionally goes after taxing unrealized gains.

and there are a lot of things in that budget plan that are not going to get passed. my assumption is that is one of them. let's really talk about reducing the debt, how we get at that, and most people who come on even will admit you got to come after both sides of this. to be able to do this, we're now looking at the ecb which said the eurozone nations this week, they're saying that they have to have a immediate and permanent debt reductions, that it is imperative because of the aging population, increased spending that has to happen on defense. why are we in any different situation? >> well, first of all, let me lightly and politely challenge one thing you said, which is about legislative success. i feel like we had this conversation before, becky, you said there is no way you're going to legislate that and then lo and behold, president biden managed to get some really important wins over the legislative goal line. so i think it is probably wrong and it is commonly done to discount the president's ability

to -- >> whether you're able to do it, it seems crazy. it doesn't seem like a plan that, a, makes sense, is fair, as you constantly say what's fair and what's not, to be taxing things that have not been realized yet. i can understand being frustrated when somebody is using unrealized gains to borrow against and use as income, that can be changed. >> i know you don't -- we argued about this before. i know you don't like the minimum tax on billionaires, but the fact -- >> i don't have a problem with the minimum tax on billionaires. i have a problem with taxing unrealized gains. that's a big difference. >> this is a good conversation for a different segment. we don't view it that way. but at any rate, that's just one -- hold on. that's just one of many proposals. what about the president proposes to take the corporate

tax rate from 21% to 28%, that's about half the way back to where it was before, and, look, every point on the corporate tax rate raises about $150 billion over ten years, that's real deficit reduction. our opposition wants to go the other way, to lower the corporate tax rate. so, look, we can argue about the granularity and i'm happy to do that of the different plans, but we're trying to stop digging, we're trying to build our way out of that hole through both spending cuts, particularly on the healthcare side, which also delivers real benefits to working people in the form of lower drug costs, lower healthcare coverage, lower costs on insulin, and at the same time, yes, what i would describe as a fair share. look, when the very wealthy are paying a rate of less than 10%, i think that's unfair. when the millionaires and billionaires are evading legal taxation, i think that's unfair and i think we should close that tax gap. >> i would love to continue this conversation. they have been telling us for

the last four or five minutes we needed to wrap. i'm sorry. i would love to continue this conversation. looking at spending cuts that is more than just saying we're not going to pay anymore, i would love to dig into that maybe the next time you're on we can. >> you know, allowing medicare to bargain for lower prescription drugs, that's something presidents have been going after for decades and my point to you earlier, this president got that over the goal line. he legislated that. >> jared, i would love to dig into this. we will. >> let's do so. >> we appreciate you coming on to talk about it. thank you. when we come back, in this year's top states for business infrastructure is the heaviest weighted category. it is what they're pitching to business when it comes to economic development. scott cohn will tell us why. next week we will bring you coverage of the aspen ideas festival featuring interviews with david rubenstein, peter teo, brian grazer and n ancisco fed president mary daly. "squawk box" will be right back.

hello. i'm ethereum. and i'm big finance. you look really tired. just calling it a day. but it's 4 p.m. yeah, and i've been working nonstop since 9:30 this morning, so. 9:30. you don't say? yep. you'd want a little shut-eye too if you'd been moving billions around the world. well, actually, i do. you know, stablecoins, nfts, loans. people can access me 24/7. what? but look, everyone's different. you should get your rest. you'll get after it tomorrow. tomorrow's saturday. [ethereum] monday. you'll get after it again on monday.

we are less than three weeks away from the big announcement of our 2024 americas top states for business. as we told you last week, this year's big theme is infrastructure. that's what the states and companies are talking about.

scott cohn joins us from a place that has been learning some tough lessons about infrastructure lately. he's in baltimore. scott, good morning. >> reporter: good morning, becky. behind me is what used to be the frances scott key bridge until it collapse, of course, on march 26th. last week they got the navigation channel reopened. it happened a lot faster than the initial predictions. >> some were saying this could take upwards of a year to get this done. and it didn't take 11 months. we got it done in 11 weeks because we worked together. >> reporter: yeah, but now comes the really hard part. they want to build a new bridge in four years. they plan to hire contractors this summer. and in the process they also want to reimagine all the infrastructure around here, public meetings are already under way. in many ways this is a fast moving version of processes that are going on in every state. transportation secretary pete buttigieg says, yes, some of it

has to do with all the government money available, but not all of it. >> we were reminded as a country the hard way how important our infrastructure is because of the pressures we experienced at the beginning of this decade with covid. we saw what happens if our supply chains come under strain. >> reporter: infrastructure does carry the most weight in top states this year. we look not just at roads and bridges, ports and airports, but also broadband, water and electric utilities, development sites and more. you can read all about our study, how we're doing it this year and all about competitiveness at topstates.cnbc.com and we will reveal all the states how they did and you'll be able to see them there on july 11th. >> looking forward to it, from afar. just in terms of infrastructure, it is something companies are talking about. but not just talking about. i think maneuvering, trying to make sure they can get in on some of the infrastructure spending too. >> reporter: yeah, absolutely. that does have a lot to do with

it. when you put out half a trillion dollars in new transportation spending under the bipartisan infrastructure law, that will draw companies to it like moths to a flame. there also has been all of this kind of neglect over the years, but also companies want to move fast. so one of the things we're looking at the infrastructure this year is where the sites are, but also state initiatives to create travel ready sites. some states are doing it. not every state. some of the traditional top states are not doing it. so we'll look at that as well and that factors into this all important infrastructure category. >> when you say shovel ready, you mean permanent all ready to go, no waiting around for things, just plug and play? >> yeah, the utilities are there, the permitting is streamlined, it is not necessarily done, but a site that a company can come in and within a few months be building there. this is what companies are demanding in many, many cases. especially when you have companies that are building

megafactories, the chips and things like that that need a megasite, they need that and some states are delivering. >> scott, thank you very much. it is a good tease. one of many ce.toom "squawk box" will be right back.

our next guest forecasts that france will avoid a financial crisis, no matter the results of their upcoming election. want to bring in greg ip, "the wall street journal's" deputy economics editor and chief economics commentator. this has been so closely watched, the snap election surprised so many, including both parties, i think, within france. what does it mean for the future of the eu and the euro? what does it mean just financially for france? >> well, you know, le pen and the national rally, which are leading the polls now in france, are one of the oldest and most well established best known so-called populist far right party in europe and has long advocated for taking france out

of the european union and the common currency, the euro. there is a bit of nervousness and knee jerk reaction that when investors see a high chance they will win this election that the euro's fate is once again in the balance. but i think people need to catch up with reality. there has been a pretty important evolution in europe, european politics in the last five or six years, where a lot of parties on the right have more or less completely dropped that part of their program. and le pen and the national rally no longer talk about leaving the european union, but reforming it from within. that's not to say that it is all smooth sailing because they still have a fairly aggressive fiscal spending program, and so i think that's one of the reasons you see nervousness in the market with bond yields in france going up relative to germany's. but the fact of the matter is that as long as france stays in the euro, they're going to be subject to a lot of the strictures of it being part of the common currency, one is that you cannot spend with abandon because you don't control the interest rates and the currency

in which you borrow. >> so, is that behind the ecb's warning this week to, what they're saying, all euro nations, that they need to rein in their spending and cut their debt immediately and permanently? is that a reaction to what they think is going to happen in france post election? >> well, what we saw is the european commission issuing their annual review of the deficits of member nations and this was part of an annual exercise where countries in violation of the stability and growth pact be, they get a warn and told to enter something that the europeans call the excessive deficit procedure, which is essentially a bargaining session where they lay out a plan to get numbers down. france was one of seven or eight countries that was so named and shamed, so to speak, and, yeah, you can think of that as a warning across the ballast that they need to work on their finances. you can imagine a scenario where the government comes in and thumbs their nose and says we

can do whatever we want. you look at italy where the numbers are worse than in france, giorgia meloni, the populist prime minister, talked a big talk about being defiant of brussels before she became prime minister and since then she's been a team player. i think it recognizes a couple of things, becky. first of all, that the european union european union renames a very popular institution with voters. not that they love it but the alternative is worse. nobody wants to go back to the italian liter or the french franke. the french franc. the reality of big deficits is the markets aren't going to bail you out. a strong incentive no matter what you say on the campaign trail. you have to negotiate with the european union to put your finances on a more sustainable path. >> greg, i liked in your piece you pointed out the savers in

the nation, anyone with money in the markets, savings, pensions, they don't want to go back to their initial currency and have it massively devalued so that they lose massive amounts of whatever savings or wealth they have. >> i know. i think actually what is surprising and underappreciated consequences of the last few years that it's actually reaffirmed the importance of keeping low inflation and central banks independent and with their eyes on the primary goal of getting inflation low. i think it's fascinating, for example, in mexico, a populist president and his new successor re"firmed the autonomy of the central bank. in south africa, the president, in order to form a coalition government with a democrat uk alliance, the opposition party had to agreed to make payments to the central bank. in europe you see no matter how you you feel on immigration or same-sex marriage, don't mess with the fundamental economic foundation of the eurozone.

>> right. because central banks control things until they don't. and the markets speak up. then you have to listen. >> that's right. >> thank you. always great talkingo u. tyo "squawk box" will be right back. you bring a lot back

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schpwikert on the fiscal company and later new york clamping down on social media plaid forms and their eartr algorithms. new york governor kathy hochul joins us to discuss. you know, to discuss. period. "squawk box" will be right back. we're going to discuss it. at least, not the way it could work. your people are buried in busy work. and you might be thinking... can ai make it all work? it can. on the servicenow platform,

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you know, stablecoins, nfts, loans. people can access me 24/7. what? but look, everyone's different. you should get your rest. you'll get after it tomorrow. tomorrow's saturday. [ethereum] monday. you'll get after it again on monday. has released its response to president biden's economic report. according to democrats national wages and salaries grew by almost $17,000. that would outpace growth during that period by nearly $4,000. joining us is a republican's stake on the report. congressman david schweikert, chairman of the joint economic

committee. congressman i don't know whether you were just watching. just had one of the president's spokespeople on, jared bernstein, and he was talking about disposable income, and how that is actually above where it was pre-pandemic. so i was trying to figure it out. i asked, are you sure inflation adjusted is above? i looked it up. that includes all the pandemic spending, all the stimulus. add that in to the total. so it does come out above. but if you look up weekly wages, real wages, inflation adjusted wages, we are still below where we were when president biden took office. people's paychecks have not kept up with inflation. so you see how you can parse it? you do disposable income includes all the stimulus the government gave people in the sum total. so it's up over the four years, but wages are still down, because they only started rising last, i think may of 2023. it's like just depends who you are and how you see things.

not right. >> look, we refer to that as election-year math. and, look. there's a reason so many people are angry in our society. i represent the phoenix scottsdale area. if you don't make well over 26% more and that's the mean. 26% more since president biden took office, you're poor. and sort of the math gains have not been willing to accept that. and we tried to do something actually much more intellectually honest in our response to the president's budget. we walked through tax policy, and what really would happen and the number of jobs and the economic growth and the fact that most of the tax cuts actually go to wages. we walked through the demographics which is shocking more people don't talk about that, because that's not republican or democrat. the fact of the matter is, the u.s. debt right now is substantially driven by interest and the fact we're getting

older. and then we try to walk through actual solutions. and a couple of them are going to get me in trouble, but they're mathematically honest. i mean, obesity in america. right now may be the single biggest driver of growth of debt. and you actually walk back through the math and you understand. you're looking at something that's potentially 9.1 trillion of spending. over ten years. is that republican or democrat? it's an opportunity to do something more, and that would be great economics and great for debt and deficits. >> congressman, so -- if we, if everybody is microdosing one of these new weight drugs, are you saying that would help? are you saying the effects of diabetes and heart disease and -- i mean, it's across the board if you're obese. you have all of these problems, these chronic conditions, and -- are you saying that it costs

money to treat it or that it costs money to try to get people to lose weight? i think that's a good thing to spend ton, then, isn't it? >> you're asking a brilliant question in many ways. i wish you had a whiteboard. our math says in just a few years half the united states will be technically obese. are you willing to talk about farm agriculture, farm policy, the farm bill? nutrition support? is it moral to give someone the modern equivalent of food stamps? the ebt card to buy onion rings, and then are are things out there that we could do to help society change? and is it a semigluetite or other things. jared talked before. tax us $100 billion more, when your baseline looks like you're going to be borrowing $2.5 trillion a year, that may be

good theatrics for being on a television show but it's crappy math. it's almost rounding errors. >> it's all the numbers are -- are almost historic in terms of, okay. 7% of deficit to gdp. that's way more than it should be in a growing economy. when you talk about what we're spending. revenue is about where it should be. the tax -- you know, they complain about the tax cuts. nothing's really changed. >> no. >> about what we bring in, but we're at 24% of, is what outlays are. that's unsustainable. i don't know how you fix that. >> it's mathematically absurd, and, look, let me put it in a quick perspective. if you take a look at almost all the tax proposals coming from the left, and you do their $400,000 adjustment, you might get 1.1% of gdp. those who would like to reduce the size of government just go

to non-defense discretionary, you might get 1% of gdp. say, here's 2.5% and borrowing this year 7, 8% of the entire economy, if you're not willing to sort of do major policy, that the solution actually is a tax code that maximizes economic growth and robustness, regulatory code and. >> now that you have a.i. and so many other things you could have a revolution in how you do regulations, keeping society safe and healthy. but then the next step is, what are you willing to change policywise? we often talk about health care, because it's just, you know, the primary driver. but you will get an army of those shockingly more from the bureaucracy terrified of saying what would happen in society if you made us dramatically healthier? s have the fif belong year in a

row prime age males are dieing younger. 15 years from now this society, more deaths than births. so i like to think actually those of us on the republican side, we're actually sort of, we built a report that offered actual moral and great economic solutions, instead of sort of the election-year rhetoric and math. >> we hear a lot of it. but it's staring us in the face, and those are some interesting ideas that you talk about. i didn't realize that about obesity. i've thrown up my hands, not about my weight. i've done that, too, but i've thrown up my hands what we're going to do with you know, we're going to be at -- what? debt to gdp's stuck above 100. never coming down. >> well over 100. >> never coming down. by 2030 and 2040, 140% and i don't know how -- left loves to spend money to try 20 to help

money. no money, other than debt service, to spend on anything. i don't understand why that doesn't -- why the president is -- why that's staring them in the face. >> you're looking at some math if we continue what we're doing now in nine, ten budget years 36% of all tax receipts, every tax receipt, goes just to pay interest. >> right. >> look, it's demographics. we're crashing the next generation. i'm blessed. i have young kids. my children will be technically poor than the generation before it, and it's math. it's, we have almost doubled u.s. taxes in about 20, 22 years, just to maintain baseline spending. >> all right. congressman, thanks. appreciate the thoughtful response and good to have you on, because we -- you know, we hear from both sides and it's --

it's like, each side sees it, has got a totally different world, seems like, that they're looking at. and it's -- >> we work in a math-free zone in washington, and one of the things the republican side of the joint economic committee is, we are absolutely committed. we're going to tell the truth. whether it fits our rhetoric or not. the math is the math. we'll always win. >> that was h.w., wasn't it? >> yes. >> i think that was h.w. whatever number he was. thank you, congressman. good to have you on. it is a little after 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. among today's top stories -- auto dealers nationwide feeling the effects of a cyber breakdown at key technology provider cdk. yesterday was the second consecutive day of that outage with many dealerships going back to doing things with pen and paper. president biden's re-election campaign tells cnbc

that it and the democratic national committee raised $85 million in may. that's the second best month of the election cycle. former president trump's campaign and the republican national committee previously said that they raised more than $140 million in the month of may. and one of our top stocks this morning, apple. frequent "squawk box" guest tony sack nagi raising his pras target to $240 from $195 saying apple has multiple different way as it could monetize a.i. but cautioning benefits could take longer to materialize than some bulls think. that stock now at $210. go to mike santoli at the nyse. interesting day yesterday, mike. reversal. dow goes up everything else kind of goes down. all about nvidia. >> exactly what i was going to start with. first of aerial, back it drop s&p 500 by most, quantitative measures a little stretched. really strong trend. what the 200-day moving average

tells you. slowing up as it is. a 12, 13% spread between the index and that moving average. similar in proportion where we were before you had these hesitations, pauses, pullbacks. maybe that's what's at wok here, but xoe driven by that narrow group of mega cap stocks the average stock in the market is not stretched at all. therefore, you have potential for some kind of rotation. what we had yesterday. big momentum leaders breaking stride and you actually did have relief come in in the areas of energy stocks and somewhat smaller name. look at the dow versus the nasdaq 100. this has been stark. obviously both big cap indexes very different composition and construction and the dow, of course, backed off since it did click to 40,000 at some point on a year-to-date basis. a very big spread. nasdaq 100 a hyperconcentrated play on mega cap growth. you see barely a little bit of hints of convergence in the last day or so. take a look at some of those big momentum leaders, though, and the action you that you can see.

yesterday morning, nvidia in particular had a big exuberant pop at the open and declined by a full 3.5% on end of the day. also chipotle and eli lilly in this mode of kind of piling on gains. they are big in the sort of secular winner momentum stock basket that's been obviously leading the way. so we'll see if this causes any kind of turbulence or just a rotation. you have a big options expiration today as well as index rebalancing. sometimes that's a cause to clear the decks to see if we have potential trend inflection points. >> i hope you don't have anything else to say, mike. because you are absolutely not allowed to say a single thing and neither am i. >> i'm done. >> thanks, mike. see you later. >> that's too much! what they just told me. that -- that's too much! that's too much! >> wasting time.

sorry. when we come back a new attempt to keeping young people safe online. new york governor kathy hochul signing bills designed to protect children online. some tech membersaren't too happy about this. you're watching "squawk box" and this is cnbc.

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new york governor kathy hochul signing two bims aimed at protecting children and teens online. one aims to make kids social media feeds less addict ive the other protects personal information. claiming free speech violations. for more we welcome governor hochul. governor, welcome, and thank you for taking steps to actually try and cut back on some of these things. it's been something that congress has been unable to do over almost two decades of going back and forth on this. what do these laws do? >> first of all, i'm a former member of congress. i'm not surprised congress is not able to handle this,

although this should be, responsible, a national policy that says we prioritize the mental health of our children. it's that simple. and all the statistics are pointing to a very dire outcome for our children right now. over the last two decades. the last decade in particular. suicide rates among teenagers have gone up 70%. teenaged depression. something that was not a fact whir i was growing up for previous generations it is real. so many young people taken into a dark space, because the companies have designed these addictive algorithms to pull them in and hold them captive at a time when they should be out socializing with other people, paying attention in classrooms. so i am mot surprised there's opposition. here's my message to the tech companies. why don't you get out of the courtroom and come into my conference room. we can work this out together. i think it's much better for

your branding to show that you are socially responsible, morally responsible, and care about the outcome and the mental health of our children and your children as well. >> a group representing these tech company. net choice, saying your law violates the first amendment censoring free speech online. sound like they're gearing up for fights in the courtroom. what do you know at this point and say back to this argument? >> litigation's a gross industry in the state of new york. bring it on. not that we're unaccustomed to this but we are prevail because we were careful in our drafting making sure freedom of speech is protecting. simply saying to these children, you can socialize with friends. join a community online. simply saying to companiesies a part of your marketing tools, trying to create, holding

hostage for the next chapter of their lives. we're saying leaves kds alone. right? leave our children alone. don't bombard them with algorithms that are irresistible to children. let them have this space before they're 18 years old. a little more carefree and let them select what they want to see and not have you preselect based on monitoring these young people's social engagement. think about all the data collected by our kids not just used by social media companies to construct algorithms to pull them in. also monetizing this. profiting off your children, my children's information, that's online. i think there's a business model that can be still very successful for these companies and new york city, new york state, we are a tech capital in, and everyone looking for tech jobs last year. number one destination in our nation. we're proud of that. this is not hostile to big tech. we're happy they're in new york. we're happy they're doing what

they do, except in this one space. they should also understand they as parents should understand, is not healthy for this generation. and the effects are real. this is not hypothetical. this is not just being going around talking to thousands of young people and hearing their voices and the young woman who said to me, you've got to save us from ourselves, because we're not able to put this down. you realize, it's not their fault. that's exactly what these companies intend. they don't want you to put down the device. so that's what we're up against. but we're ready for any challenge. >> it is clear that it's not -- happenstance. looking at the lead story in the "journal," governor. instagram knows exactly how it's working. racy content to teenagers. wonder if that will quark? star -- will work.

watch reelz, person watches to the end more racy stuff is offered at the end of it and god know what's comes then, but they know exactly -- i mean, the algorithms are designed to appeal exactly to them and eventually end up with everybody addicted to porn and they know full well that that's what they're doing, and teenagers, i mean, i understand that that's why racy content is going to work. just seems ps like a daunting t where to draw the lines and i don't know where parents come into this either. you could say these companies are just -- satisfying the normal urges of maybe teenagers? some of the stuff that happens. >> i will tell you this. this is all about driving profits, and parents under our new legislation, the first in the nation that is taking this step to protect this generation, and i hope every other state follows. follow what we're doing here in the state of new york, because here's why -- we are going to empower parents

to be able to turn on the "off" switch. you can bombard people with algorithms, parents should be empowered to have control over that. not the companies. parents will be able to now say, no. you're not allowed to do this. also saying that parents should be able to have say whether or not you can send messages and notifications between midnight and 6:00 a.m. our children are sleep deprived. walking around like zombies in schools, not paying attention. i want to say this to the tech companies. what you're doing is happening to your next generation of workers. if you're a business leader, looking at kids in middle school and high school as your future workforce, and you realize that they're so addicted even during the day they can't put down the smartphone. they're not paying attention to their geometry class, they're teachers and also not developing social interpersonal skills so necessary. it's creative collisions that happen in the work space that could drive the innovation of the economy we're so proud of in

new york. we want to foster that, but let's protect the mental health. not have a workforce that is coming out of teenage years in a state of depression. and unable to communicate at a healthy level with other adults, because they were denied this because of what your companies are doing. just stop right now. you can make plenty of other money in other ways. i guarantee it. very creative people working in these companies. let's save our children. >> we have had other people say that this could be something where if other states do copy you, you would eventually be pushing federal regulators to get involved with this. federal legislators, to get involved, too. hopefully at least this brings attention to this and does force others to follow along. while you're here i want to talk to you about congestion pricing. this is a move that had been anticipated to take place later this month in new york city. already the -- infrastructure's been set up for it. you put a halt on this for now,

because you say it's not the right time when you're trying to get workers back into offices. when you are trying to make sure that people will come back from work-from-home. how long does this, this shutdown last? is this something that you see coming back next year? >> here's what we're thinking right now, and i'll tell you why this is so important. we cannot be tone deaf to the needs of our workers or our employers. i have talked to so many employers. major employers in new york city who are concerned right now that things are improving, working on our, comeback almost there, but we don't neat a setback at this time. and with remote work, which not even existing when this was enacted under my predecessor back in 2019, people might say do i really want to spend $300 more a year to come into manhattan or see if i can work from home? that can have a dire effect on our comeback and our economy and

all of this subsidiary businesses that count on, i mean, broadway, restaurants. little delicatessens, the shoe shine person. all of these affected whether or not people come into our city. i want people to come into our city. that's important to me. i want us to continue thriving and putting the pandemic in the rearview mirror, but right now $15 for anyone to drive into new york city is too much at this time. so i'm working with our legislators to find an alternative funding source, because every single project that is envisioned with the money generated from this is an important project. i support them. i have supported congestion pricing, but think about the effect of $15 right now? even -- >> you're preaching to the choir. i agree with you an all of these counts. i think it's a bad idea from the broader economic perspective here. i've heard from a lot of those businesses, too. the issue is some people say this was political.

that there were going to be democratic legislators who lost in this election coming up in november and there is this undercurrent that thinks, okay. this is gone for now but by early next year it will come back. what do you say to that? >> i will say right now $15 is not the right price. that does not mean it's gone forever, but let's just be reasonable. right now new york city residents are under siege. they have high costs of living. everybody. water rates up, rent rates up. a lot for our citizens, and we should not ignore them saying to us as government leaders are, we just want a break once in a while. who's listening to us? i'm listening to them. >> by the way, looking for alternative revenue sources this will raise about $1 billion a year. $700 million lost right now every year from people who are jumping the fares at the subways and buses. 45%, bus riders, aren't paying their way. there's $700 million you could

go after. >> absolutely right. said that before. there's other funding sources. i want to do the second avenue subway. i want all the improvements promised to new yorkers based on the bonding off this $1 billion. but we are capable of doing this. i support the mta. i bailed them out last year. no one can question my commitment to this life line that makes new york city so fabulous and so successful. we love the subway system. i'm the biggest supporter of the new york city subway system, because last year it was going off the fiscal cliff and i pulled it back with a creative funding strategy. i'm committed to this, committed to the projects, but right now at this time it is too much for new yorkers to endure this. i don't want to suppress a recovery and that's the genesis of the pause. again, temporary pause, but i'm going to say this again. $15 is too much for new yorkers right now. >> and people love it when you say, well, we already spent $1 billion and need to do it.

that drives people crazy. already spent. right? the $1 billion is already spent and we need it. >> we're in the middle of a $34 billion capital project right now. $34 billion is being spent right now. this would leverage $15 billion more for products that are important, but there's a lot of activity going on in new york city. we're committed to our subway system. we're also committed to everyday new yorkers who are struggling. >> subway hoppers. yeah. >> governor hochul, thank you very much for joining us. we appreciate it. >> thank you. coming up, pitfalls in the race to gain a foothold in the evolving world of a.i. speaking with a global editorial director about a new investigation into a perplexing a.i. search start-up. wonder what that one is? not a g bifan. stay tuned you're watching "squawk box" on cnbc.

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a new piece in "wired" magazine taking a close look at the a.i. search start-up perplexity, backed by indiana and jeff bezos among others. authors of a lengthy invest gays say it's unclear what it is or how it's a search product achieving its results. speak of inaccurate responses to questions and say it appears perplexity is ignoring a widely accepted standard to not scrape certain areas of websites when one seitz make that request for more we want to bring in katie drummond, "wired" global editorial director. out myself. katie, good to see you. i was raling about a nonnamed a.i. service and i don't try many, but i tried this one particular and just thought it was, total garage. garbage in, garbage out. you ask a question about an individual, about anything they scour, reddit chatboards, find

the nastiest stuff from outlier and put that as an answer. it was a mess. it was ego and no thinking or analysis or any of the things we tie to a.i., which make it better than just google. none of that was present, that i could tell. >> right. well, it certainly is a confusing tool. it's also a tool that in a very short period of time has built up towards a valuation of $1 billion. this is a company that is, has developed a product exceedingly popular from what we can tell. it is also quite honestly very confusing trying to understand exactly how perplexity works. how it obtains information and sort of how it summarizes and synthesizes that information for audiences. >> can it get better? because for me it looked like it just -- searched the web. collate add few things. put it all together with no logic or like the next

derivative of whatever a.i. is easy supposed to do, other than just searching the web for whatever, you know, terms or words that you use. you know, and the -- the valuations we're seeing for nvidia and for the whole a.i. arena can't just be from searching the web and finding a couple of things and sticking them in a hodgepodge together. that cannot be what a.i. is. i looking for -- looks like it's 100 years off when i look at this thing. >> well, i don't know that you're ever going to ghent to sentians. >> give me something other than a google search. >> sure. these companies in this race to be first, to be the biggest, obtain the biggest valuation, you know, the biggest market share, the real question our investigation raises is, off the back of what information? you know? how is that information obtained? and what we ultimately discovered is that despite the

fact that engineers at conde nast, the kparntparent company "wired" and many other publications accepted a protocol robots txt that essentially tell as crawler or bot do not scrape this website. we don't want you to access this information. what we discovered and what it appearsplexity is doing to a race to be first, be biggest, actually scraping our sites using an undisclosed ip address not on the list of publicly available ip addresses perplexity shared with the public. they were using that ip address to essentially circumvent our request that they not scrape our journalism and that they not use our journalism to sort of fuel their product. >> katie, in terms of inherent biases, too, and, you know, whether you're right or left, you can go back and look at

certain recent things that we've seen in the last three, four years. the way something is characterized, and for lack of a better idea, let's say you search perplexity. where did covid come from? what if it tells me it was absolutely jumped from one animal in a, in a wet market to another, and then -- it can do that. it can give -- when it searches, i've looked at things i disagree with consensus on and it comes out with the, with the knee-jerk answer, some of it. is chatgpt, are any of them totally non-biased and fair at this point? and accurate? >> well, you know, these tools rely on information that is readily available on the internet. >> it's gigo. giggo! i want something to say this is

garbage and i'm smart enough to know this is garbage. >> i would say at this point your best bet and sort of the best bet for anyone looking for accurate information go droirecy to the sources of that information. go to the source. >> don't use a.i. google it, do the research yourself, because you need to be the intelligence that gives you the answer that you need. so we're back to square one. than why is this, suddenly why it this worth trillions of dollars in the stock market? >> well, again. this is sort of the technology industry run amuck with journalism and inaccurate information as collateral damage in this race. i think that the technology industry i think for a long time has really been divorced from the importance of news journalism, the importance of accurate information making its way to the public. those two things can work synergistically in this instance they are not. i think, of course, we've soon

many instances in the last few decades they have not sort of worked the way that is simpatico and in a way that reinforces news and journal inch and accurate information as really the bedrock of a civil society ultimately. >> wow. well, don't forget how. because that's what's going to happen. you know? if we don't watch out. so we've got that -- or we got, remember watson? watson said the biggest north american airport was in toronto. i mean -- >> biggest american airport. >> whatever! the biggest -- airport in the u.s. was in toronto. that's what you get with -- i don't know. katie, thanks. we've come a ways since watson. that was 20 years ago. >> may have been more. >> that's the point that we're making. how far have we really come? >> since the beginning. may not ever get to simpatico. >> i know. no. i can't -- like --

>> i mean, i am -- look, a lot of things i want out of a.i. a lot of great medical advances we can guess, i think, but bad things come with it, too. anyway, when we come back we're going to ask former boston president eric rosengren about the latest challenges and questions fating the u.s. central bank. stay ted "squawk box" will be right back.

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sa rrepta receiving approva in the u.s. including more children with muscular dystrophy a deadly muscle disease and expanding the market for their somewhat controversial treatment still hasn't been completely proven as a benefit in clinical trials. >> primary benefit. secondary benefits, and -- >> nothing else. >> where there's nothing else to do and this is a disease that kills these children. >> right. >> boys get more frequently than girls. >> muscular dystrophy. >> but you don't live past the age of -- now some are living into their 30s. used to die 16, maybe 20 years old. >> yeah. terrible disease.

waste away over time. could potentially slow progression. it's very expensive, pashrt of e reason -- >> $3 million. >> a one and done treatment. something you're paying $100,000, it's not that. look at other drugs out there. this is a gene therapy. it's very novel. watched very closely, because the hope is this can head to other -- other genetic diseases. >> yeah. a big market cap gain. was an $11 billion company before the 40%, before that 35% gain. despite the holiday shortened week a big few days. for fed speakers. one of the main takeaways, officials seem to be in no rush to cut rates right now. joining us former boss and fed president eric rosengren, now a visiting scholar with m.i.t.s

center. the takeeway for you, eric? been there. down to like, one, maybe one rate cut this year is sort of the consensus. >> yeah. the median from the summary of economic projections was one, but i would say eight of the participants at the last fomc meeting pencilled in two. i think we're at a stage where if we continue -- we had earlier in the spring a series of reports that looked like inflation was flattening out, and that's using both the cpi and the pce. right around the meeting we got a cpi more favorable. i am expecting we're probably get some more favorable inflation numbers over the next couple of months. if that does happen, that would set up a potential for an easing in september, and possibly one in december. so i don't think we're down to just one yet. i think it does depend how the data comes in. if the data doesn't continue to

come in similar to what we saw with the cpi in a favorable sense, then it might be difficult to get the two in, but i think we'll have to see how over the course of the summer the inflation data comes in. >> so, eric, is the -- the waning inflation we're seeing, do you attribute that to what the fed did in terms of the 500, whatever? how many basis points, that the fed hiked. do you think that's a result of that and what i'm getting at it, looks like a bit of a lag. do we need to worry about unemployment going well above 4%? is there going to be a lag there as well? and is the economy slowing more than we know? >> well, that's one of the challenges with monetary policy, is there can be pretty long lags between when the fed takes action and when the effects are fully felt through the economy. so more recently we have gotten some weaker data.

the retail sales was a little weaker. initial claims dropped off. a bunch of labor market indicators that are indicating that the economy is a little bit slower than it was before. as you say, the unemployment rate's at 4%. it was around 3.5% earlier. so we're probably at a stage where if the labor market were to weaken significantly from here it would show through to the unemployment rate in probably an undesirable way, but my baseline forecast would be kind of 2% growth and that wouldn't be a situation that i would expect the unemployment rate to go up considerably. and i would say in the absence of the tightening that was done we probably would be seeing still very tight labor markets and you probably would be seeing stronger growth at this point. >> well, that's amazing, because if we get -- the scenario is just so, so goldilocks there.

so we can get our true rate cuts. we can keep employment, unemployment very low, and keep inflation low. it's like too good to be true, but maybe it will happen. we'll check back with you if we can in a couple of months. it's hard to -- i mean, aren't you surprised? is it really working? it's really working! i can't believe it. >> it's been more favorable than many economists expected. >> yeah. >> but that's good news for the economy and good news for americans. >> right. we're not complaining. all right. thank you. when we come back we've got a verizon board member who is going to weigh in on the state of the job market. you don't want to miss unique insights we're going to get on what she's seeing all over the corporate world. "squawk box" will be right back♪ ♪♪

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welcome back, everybody.

our next guest joins us to talk about the shifting currents in the labor market. a.i. disrupting things and morgan stanley reported earlier in the year mentions of operation's efficiency way up on u.s. earnings calls. our guest now has pretty unique insights into the labor market and via her many board seats. we welcome shellye archambeau, ceo of metricstream and current board member at verizon, oct kaw, lineage and roeper. thank you for being leer. trying to get a feel what's happening in the labor market. you have a front-row seat to this. is the labor market getting to the point where we're going to look for a lot of layoffs? >> you know, first of all, thanks very much for having me, becky. it's great to be here again. first of all, when you look at the marketplace right now, it's important to put the headlines in perspective. so, yes. we're seeing a lot of headlines about layoffs. tech companies, ciscos, u.p.s.'

et cetera, but there are 160 million people in the u.s. labor force. and what you're seeing is, i would call it normal behavior. companies are constantly restructuring, doubling down on investments that work, and then unwinding ones that aren't. so shifting workers around aren shifting workers around, et cetera. in any given year, almost 20 million people are either laid off or fired. now, that said, you hear a lot about, from companies and their earnings calls, in terms of driving productivity, et cetera, because right now, there are a lot of uncertainty. i mean, we heard from the last guest talking about his news with regards to economy, but i'll tell you, there's still a lot of uncertainty. money is no longer free. inflation is rising. talent is still challenging in certain areas. so, when that happens, companies get conservative. and when they get conservative, that means they want to make sure they're driving profitability, because that's what the market's looking for when there's economic uncertainty. that's causing some of the

behavior that you're seeing. but a lot of it's pretty normal. >> if there are still hard to find, talented, skilled employees, you would think companies would not be laying them off. have we gotten away from that? or are there still some professions where you're going to hold on to, let's say, every i.t. person you have, every programmer you have, and particularly anybody who's looking at some of the latest and greatest with a.i.? >> oh, there are definitely skill sets that are high demand, and absolutely industries that are high demand. so, yes, we look at tech. everything from anyone in information security is in high demand. people who are in anything related to a.i., data science, et cetera, but honestly, it's not just tech. health care. that industry can't hire enough people. education, also hiring. manufacturing is seeing challenges, and they're also hiring. there's lots of hiring going on.

last month, we hadded 272,000 jobs, and when you look at the period, pre-pandemic, 2015 to 2019, the average was about 190,000 a month, so we're still, as an economy, we're still hiring. and there's still demand for people, even though you're seeing layoffs. layoffs are really just a shifting of either investment areas or investment types across companies. >> we talk all the time about productivity gains that a.i. could bring us. are you seeing any of those yet, and does that mean that we're not going to hire as many workers down the road? does it mean that we will get rid of some employees who currently have jobs? >> i think, with any new technology, yes, it brings opportunities. absolutely, for efficiency. from an a.i. standpoint. we are starting to see some good, real opportunities with regards to efficiency. especially in areas of customer support where we could actually get more insight and more information quickly to be able to better serve customers, so

we're going to see that, but it's still very, very new, and very early. so, we're not seeing that reflected yet with regards to overall -- i'll call it the job market itself. we do expect that this will fuel more growth and better service customers for sure in the future. >> shellye, is inflation under control, at least, from the perspective of the corporate boardroom? is it an issue that's still discussed as frequently? >> it's still absolutely being discussed. you have cpi, which is the consumer price index, and that's how we judge inflation, but depends upon what business you're in, different drivers of cost affect businesses differently. so, for instance, look at energy prices. energy prices in -- let's see -- 2020 to now have actually almost doubled, so insurance for catastrophic or property, et cetera, has also increased

significantly. so, companies are seeing inflation in their costs. escalators in software pricing, et cetera. so, yes, they are absolutely seeing inflation, and that's why they're looking at driving productivity. they have to make sure they're still returning good results to shareholders. >> shellye, thank you for the board perspective on this. good to see you. >> thanks so much for having me. after a break, we will talk markets ahead of the final trading session of this week. "squawk box" will be right back and, oh my goodness, ware e in the red. down by 18 points for the dow.

joining us now on the markets, victoria fernandez, chief market strategist at cross mark global investments. all systems go, victoria? or if a third of the s&p's gains are nvidia, and nvidia goes down, the whole thing -- suddenly, we don't have a rally in the s&p for a day. does that all make sense? >> well, it's what we're seeing happening. obviously, the market's being led by just a few names, nvidia, obviously, being one of the biggest ones, making up a third of the returns so far year to date. but there are elements, like yesterday, we saw nvidia have an outside reversal day. last time we saw that, joe, was

back in early march, and then nvidia pulled back 20%. so, i'm not saying we're going to pull back 20% now, but it could be setting up for a little bit of a pullback in the market and perhaps that's why we're seeing the indexes down a little bit here in the premarket hours, but that's definitely the momentum trade. it is definitely a handful of stocks right now that are driving this market, which would make me extremely nervous, especially with deteriorating breadth, except the earnings are being supportive of those stocks right now. until we see that turn, i think you can't stand in the way of that train. >> so, it has got some positive underpinnings, even though the breadth is narrow. you are seeing, for most companies, that they're performing pretty well. why is there no volatility? doesn't that just -- as far as technicals go, it seems a little bit -- it's quiet, victoria. too quiet. >> it is pretty quiet, but you can look at the move index versus the vix.

you're seeing quite a bit of turning going on there in regards to yields, but you're not seeing it in theequity market. i think it goes back to exactly what we were saying, joe. you have such a small number of stocks really just taking such a giant amount of the momentum in this market that until we see those really start to change, then you're not going to see as much volatility in the rest. the rest of the stocks really haven't been doing as well. you look at earnings minus the mag six, mag seven, it's not impressive at all, and they're all just kind of laying low right now. look at that equal weighted index versus the cap weighted. it's a much, much lower number that we're seeing there, and i think that's why volatility has stayed low. we need to see breadth increase in order for volatility to change. >> yep. well, we got to end it there, victoria. happy friday. happy -- i know it's -- the days are getting shorter, because it's june 21st. >> and hotter. >> bitcoin, 63,000 now. i don't know whether that

represents speculation or not, but thank you, victoria. final check on the markets. all red. red across the board. >> no, wait, the nasdaq is positive. >> nasdaq just turned positive. it's like -- it might as well be monday already. >> no, no, no. >> we're going to enjoy this. soak it up. it's going to be hot. >> live it up. >> join us -- too hot. join us next week. "squawk on the street" is next. ♪ good friday morning, welcome to "squawk on the street." cramer and faber have the morning off. futures relatively steady after thursday's downside s&p reversal. big options expirations today would bring some fireworks. euro zone pmis slow down. our own ten-year yield is down to 4.22%. the nasdaq, ending its string of recent records. plus, nvidia pulling back,