"squawk box" begins right now. good morning. welcome to "squawk box" here on cnbc. we are live from the nasdaq market site in times square. i'm andrew ross sorkin along with joe kernen. becky is off. i hope everybody had a good july 4th, independence day. we are about to talk to somebody who doesn't love independence day. a different type of independence day they had in the uk. take a look at u.s. equities at this hour. still three and a half hours before we open up. when we open up, it will open up eight points higher. nasdaq up four points. s&p is up a bit. the ten-year note at 4.43.

then, there's this. all this may change. the fed releasing minutes from last month's policy meeting. this is happening after the closed bell or happened after the closing bell on wednesday. inflation is moving in the right direction, but not fast enough to lower rates. there should be no rush to cut. of course, we have the big jobs number, joe, later today, which might move all this around. >> would you have put bitcoin the stack? >> we could put bitcoin in the stack. >> oh, it's coming. >> it's down. >> it's down. is it down, but not out? it's 54 at this point. i can see it there. i don't know if we brought it up. 54 54,460. down another 7%. that chart doesn't do it justice. a weekly or monthly chart. you would see it. you know, we saw it at 65.

that seemed like it was down from 75. it held under 60 and once it got under 60, peter thiel -- remember, 60. i can't see myself because i bought it so much lower. $60,000 is a lot of money. i don't know now. i don't know -- if i sold some at 45 in the past, how do you think i'm going to buy it here at 54? >> i don't know. are you with cathie wood or with peter thiel? >> novo. >> he thought it was 50 to 70 something odd range. >> he did the normal pullback. i don't think we're there yet. would you be surprised to see it under 50? >> maybe high 40s. >> maybe high 40s. you gearing up? >> i'm not gearing up. i'm not geegaring up. >> the fed will give more data in a few hours with the release of the june employment report.

the market is looking for a significant slowdown in job growth. economists expect non-farm payroll picexpected to come in 200,000 which is down from 272,000 in may. the unemployment rate is ex expected to hold steady at 4%. we will have relaaction at 8:30 a.m. eastern time. the labour party winning the majority in the country's general election unseating the conservatives after 14 years and just hours ago, outgoing prime minister rishi sunak conceding defeat after less than two years in office. apologizing to his party for the scale of the loss. keir starmer, leader of the center left labour will now become the next prime minister. take a look. >> now, we can look forward again and walk into the morning, the sunlight of hope p, pale at

first, but getting stronger through the day, shining once again on a country with the opportunity after 14 years to get its future back. [ applause ] >> okay. joining us right now is sky news anchor and msnbc andcnbc news contributor and one of our own is back in town. >> it's great to be here. >> wilfred frost. >> back as a father. >> good to be here. the picture we saw of sunak offering his resignation was moments ago. he is now seeing the king and offering the resignation. he will see starmer to 10 downing street as prime minister. keir starmer is the most powerful prime minister since tony blair in 1997.

he has a massive majority over there in the uk. he has a huge majority. what he wants to pass will happen. that's off actually quite a small percentage of the vote. he has over 60% of the seats from just 34% of the vote. the lesson from this, really, is more of an implosion of the conservative party, necessarily, than labour party victory. to give starmer and the labour party credit, they read the tea leaves and played things very, very safe. didn't want to rock the boat and it worked. >> tony blair had a bigger majority than this? >> neck and neck, actually. >> it was four or less? >> some predicted a bigger win for labour than this. you know, this is a huge victory. no question about that. the big story. >> how will this change britain and all of europe with france?

>> the policy perspective, versely, because they knew the tories were unpopular and could play it safe, they didn't want to change the manifesto. they didn't want to spend much with finances tight. the margin, they wanted to increase taxes on private school education, for exkexample, but ruled out income taxes. i interviewed jamie dimon a few weeks ago. he said both of them are pro business. he is, perhaps, not as centrist as tony blair, but bernie sanders in terms of politics. the really interesting thing for politics, one, they have five years of certainty ahead of them with someone pro-business. in the last three or four years, there are no threats to his party with leadership because we

kept changing leaders in the last couple of years. f there is also the possibility to take the uk closer to the eu again. the renegotiation is next year. it comes early in his parliament. he doesn't have to worry about re-election. he will take the uk back into the eu, but make the trade relations a bit tighter. >> that has been broached, the possibility of rejoining? >> i don't think anyone would feel so. you risk the defeat. by this time around -- >> people want to go back and say. wilf made the point if you add the reform together with the tories, they were still much more -- >> not in seats. this is one of the nuances of our system. you never had, by the way, a bigger discrepancy between the percentage of seats and percentage of votes that labour just won. that's going to lead --

>> farage. he's an mp. >> getting four seats, but 14% of the vote. tories with 14% of the vote. in terms of the comparisons with france, clearly, le pen got 33% of the vote and we don't know if she will get a majority or not over the weekend. she will get 40% of the seats. the work of le pen and the far right or whatever you want to call it in france, which has taken decades well ahead of nigel farage is. another thing in 2019, boris johnston united the right ufnde the banner. rishi sunak divided them. the other thing i would say with the elefrench elections and uk elections, both have had leaders who did not have to go to the polls. they took a gamble that back

fired monumentally. both incumbents have been smashed. in france, the beneficiary is the far right, but also the far left. macron came third. the story is the incumbent being smashed. although it's the tories in the uk smashed, the incumbent is hit hard. the tories have been in power 14 years. the pendulum swings. inflation is kryptonite for whoever is in power. at least the rest of the economy is going well and it offsets the damage partially. >> i was struck you said both the conservatives and labour are both pro-business, generally. that's not the same. that's not what we think. pro-uk business. i think that's a little different, isn't it? >> going back to my first times coming on with you, joe, in 2016. we're all socialists in europe.

>> not the uk so much. >> but, again, look at the snapshot we just had which is five years ago the choice or four and a half years as, boris johnson and jeremy corbyn. jeremy corbyn was basically far left. he was much more aggressive in his manifesto and taxes and things like that. keir starmer has realized to win elections and govern in the uk, you have to tack to the center. rachel reeves is expected to be the first female finance minister today. he gets to pick his cabinet. we don't know for sure. almost certain she will be the finance minister. she is clearly pro-business. >> how about france? is that going to become more pro-business? >> i think macron has been pro-business. >> relative basis to what -- >> be have to say on a relative basis. >> i loved your chat with michelle the other day on this. i think she is right.

if you point to the single biggest thing that's annoyed voters in france is pension reform. it is not just the reforms themselves. we look at it with the aging population and you have to lift it a little bit because it is extreme otherwise. that back fired. you also forced it through against the wishes of parliament, which the president in france has powers to do. he lost the parliamentary vote and forced it through. it all came into one to sort of display to people that they had enough with macron. >> i'm just glad i heard you say the words far left for corbyn. that's all we hear is far right. here, nobody is far left. you are normal or far right. >> yeah. he's been kicked out of the labour party. keir starmer was the most high profile way starmer showed he was trying to move things back. by the way, jeremy corbyn did

win his seat as an independent that people didn't expect. on that in terms of what things mean here, it is worth mentioning his position israel and gaza and similar to the left and democrats have here with biden, he lost four or five seats whether it was high percentage of the muslim vote. he did lose seats to the left. he lost and 412 of 60 seats. nuances. >> this is it for us, again, for another three or four years? >> in person. i think i'm joining you at 8:00. i have to get to the stock exchange. >> you won't be here. that's it for you. >> in person. >> he will be through the box down the street. >> it's been a while. how long have you been gone? >> two and a half years. >> children and all kinds of things. son was here for july 4th. celebrating. >> i've always loved july 4th.

i saw it as a celebration of democracy. yesterday more than ever. in particular now, my wife's american. my son is half american. >> when it happened. still mad about that. that's not right. >> it was great. my boy had his first july 4th here. >> excellent. coming up, little joe. very, very -- >> joe came a close second. >> not andrew. sorry. like the last name in the uk. ats on the white house. president biden under more pressure to step aside as more wealthy donors jump in and pulling support.

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welcome back to "squawk box." the eu taking aim at big tech again. the eu will give a warning to x for dangerous content online. if x doesn't make changes, it could receive fines of 6% of the revenue. the eu gave similar warns to apple and meta. coming up, the pressure building in washington. netflix co- founder and disney's

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pressure mounting on president biden to step aside and he is losing more wealthy donors. ca megan cassella is joining us with more. >> reporter: joe, the drip, drip nature of the story continues. a growing number of democratic donors are publicly calling on biden to step aside. netflix kco-founder is asking hm to step down. the screen writer wrote an essay calling for a dem-bargo. no checks written until there is a change at the top of the ticket. some are holding their breath to see how biden's interview goes

with abc later today. and an email was sent to urge democrats to say why biden is the one to beat trump. the biden campaign is setting the narrative and launching a $50 million ad buy for july. guys, it is very unclear at this point whether he will be able to recover that support. joe. >> we'll see. it does matter tonight and it will be live and unedited version of the interview will be released. it's no longer george stephanopoulos taping it. some say it may have been cut. it's going to be live. the president could do well. >> right. >> watching him recently and everybody will -- i knew exactly what he was saying, andrew. in fairness, when he said, you know, it used to be so much

traffic in washington. we closed down roads. they do when the president leaves. he says, i got to go because we're not going to leave the roads closed down for a half hour while i'm answering questions. >> just one question and maybe megan knows it. i know the interview is airing this evening. is the interview unto itself live? >> no. they will do it and then they will run it. >> not live. >> the 15 minutes or whatever it is. i'm not sure -- megan, it might not be exactly 15 minutes. that's what they promised abc. they will run it at 8:00? >> that's right. 8:00 p.m. primetime special. it won't be live. my understanding is they are taping it after his wisconsin event today. you can't underestimate how important this is for the president. >> they will not do it at 8:00.

>> that's what i was suggesting. you said they were going to do it live. i don't remember it being 8:00. >> he will not go past 8:00. he will be sawing logs from what we heard. a lot of it was tongue-in-cheek. i don't have an ulterior motive because i don't like kamala. the people that used to love him so much. i don't know. watching these people so quickly change. abigail disney, i would do the opposite. >> i don't understand why you would do that. ulterior motive. there is some 3d chess you are playing.

>> that's cynical of you. >> it is. i got to be. >> thanks, megan. >> no other way. >> joining us -- >> that's how you play the game. >> former congress member donna edwards and former chief of staff mick mulvaney. are you back in the trump camp, mulvaney? you were ambassador to ireland? what were you at that point? january 6th, you resigned and you were absolutely furious and are you back now in the fold? >> where else are you going to go, joe? the primary and i know we will not talk about this. the primary is where you look among your folks and faimily an say this is my person. i didn't pick anybody at all in the republican primary. now it is the general election, it is a binary choice. it is either biden or trump.

that's easy for me. i'm supporting donald trump for president. >> i was honest with andrew. i'm not -- the democrats aren't going to listen to me one way or the other. i don't know the best path forward at this is at this point. i just don't know, do you? >> well, let me say a couple of things. one, i think it is still a choice election. it's a choice between donald trump and his craziness and his lack of support for democracy and joe biden moving the country forward. i do think it's still a choice election. neither i nor any other democrat should be in a position of strong arming joe biden out of office and keep him from running. that's a choice that joe biden has to make. look, i think where we are right now is you have some, you know,

prominent democrats and donors and mostly elites of the washington post and new york times telling joe biden that he has to leave. i don't think that is a fair reflection of the face of the democratic party. it's unclear to me if there is some move at the top that will magically result in having a strong candidate to run against donald trump. so, i think some democrats and especially donors and elites are living in a fantasy land of an open convention and the chaos that would ensue. >> right. i think these same donors, be careful what you wish for, and i'm not sure if vice president harris, if her polling didn't improve, they would try to pull the rug out from her. all they care about is keeping power. they don't care who it is at this point. it would be just as ugly if that

happened and they didn't get the right numbers there, i don't think they would be any more loyal than they are on the vice president than they are biden. >> like i said, i think it is living in a fantasy land and the idea the democratic party is going to be dictated by a handful of donors and the elites of the washington post and new york times is incredible. i think a lot of voters, a lot of base of the democratic party, would find it very offensive to leap-frog the vice president to dump the president of the united states, a sitting president and leap-frog the vice president and go with their chosen candidate. that's really not how the democratic party should work. >> donna, can i ask a basic question? you saw what i saw and what a lot of voters saw and citizens just watching that debate saw. given that part of the role of president of the united states is being the commander-in-chief and dealing with high stakes

issues in realtime. that is the job full stop. the fundamental question becomes if you're in a position where you're not at your best after 8 8:00 p.m. and you have to limit what you are doing during the day to some extent and we heard m learned more about that in the past week and a half. if part of the role is the commander-in-chief and react in real-time at height of the crisis at your best, what do you think of that in president biden right now? >> well, look. i don't think anybody wants to sugar coat what happened on that thursday's debate. that is really not the question. the question is what do we do going forward. i actually have confidence in joe biden for the last three and a half years where he has navigated multiple crises around

the world and here in the united states. he's done that well and on top of that, he has been the most productive president we've had in a very, very long time. i don't want to discount joe biden and i think they are legitimate questions. i like to look at the president over the course of the next several days and weeks and his schedule and his remarks and multiple interviews and being in front of people as a judgment of supporting him going forward. i don't think it's fair to limit that to just one990 minutes. right now, he says he's in it and he says he's in it to win it. governor whos governors who met with him agree

with him. they met with him for an hour and a half. he is talking to congressional leaders as well. i think it is time for us to shift the focus on to something that hasn't been covered. the multiple lies of donald trump over the course of 90 minutes. we barely heard a blip of that. >> what was the biggest lie? i had the greatest economy? the braggings? i'll give you the eight or nine de facto lie from the joe biden. >> january 6th. >> what did he say? >> that is the biggest lie. he continues to -- one, he continues to deny joe biden legitimately won the election. >> so hillary clinton and joe biden denied that he was a legitimate president for the

entire -- okay. mick, who would trump want to face at this point or does it not matter in your view? the left democrats think they don't matter who the candidate is that the policies are going to be just as bad. you need to support trump. so we're stuck. >> i don't know if you are stuck. donna is right. it will be difficult to replace joe biden. he has enough delegates to win at the convention. it will be difficult for the democrats to get rid of him. as whether or not he is the one democrats want to face the most, i think that is fair. clearly after last thursday, he is a weakened candidate. the way they handled the debate is much worse than the debate itself. things are trending in the wrong

direction. trump has been quiet the last four or five days. is that because when joe biden is digging a hole, you don't take away his shovel? trump did that in 2020 by inter interrupting. he didn't do that last thursday night. there is more discipline in that campaign. you hear coming out of the campaign they like to face biden. they would love to face kamala harris as well. after that, it is the unknowns of facing gavin newsom or gretchen whitmer. they don't have the data yet. >> congress member, do you see any way that the vice president would be -- i know what you said about the president. do you see any way it wouldn't be vice president harris at this point? that's not going to fly, is it? >> look, i am not going to speculate about something i don't believe is going to happen and i think kamala harris is the

sitting vice president. she's earned her place at the table and i think if democrats leap-frog kamala harris in favor of another candidate, substitute candidate, i think there's going to be hell to pay at the end of the day among the base of the electorate. black voters and black women and women. i think it will be very challenging to jump over the top of kamala harris and very challenging, frankly, to assume the support joe biden does have in the base of the party would transfer to another candidate. why are the democrats creating a chaos that's unnecessary? >> donna, thank you. mick, at some point, we'll have you back. >> you'll have me back, too, right? >> of course.

of course. you guys should take it on the road, maybe. we've done this before, right? >> it's just nice to be on the other side of the equation and get all of the negative attention for the democrats. that's a pleasant change today. >> very good. thank you. coming up on "squawk box," we're counting down to the jobs number at 8:30 a.m. eastern time. we will have a preview in a bit. check out bitcoin. coming back slightly since we came on the air. not by much. you see where things stand. the chart at $54,9596. we will see where the jobs numbers land and do some analysis of what it means for the fed. meantime, reminder, you can get it now. point your phone at it. get the best of "squawk box" on

the squawk pod. listen anytime. if you miss anything from the show, if you happen to be off for a day or somewhere tra traveling, put it in your ears. we're coming right back after this. to help you see untapped possibilities and relentlessly work with you to make them real. maria and julio thought their life would never slow down. then one day, it finally did. you were made to find inner peace. we were made to track flight prices to paradise.

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good morning. welcome back to """squawk box." we are live from the nasdaq market site in times square. we are expecting to get the jobs number out at 8:30 a.m. as i say, andrew, it is out at 8:30. >> 8:30 is the time to watch all of the numbers may move around at that point. june's job number expected to be out -- well, at 8:30.

what am i supposed to say about that? joining me now is donna peterson. good morning to you. help us understand what you think the number is going to be. did you think the number on adp earlier this week is going to portend a soft number? if you are jay powell, what will you do about it? >> i think adp is a great measure, but will not necessarily tell us what will happen with payrolls. what is important today is the composition. is it is the usual suspects or widening out into other sectors? cert certainly, the fed is paying attention to this, but the fed is concerned about the path to inflation and as long as the labor market is holding up, they can continue to focus on inflation. >> so, are you expecting this year to be a hike at all? you think this year is a move to

'25 at this point? >> we do think there could be cuts this year, probably in november or december, a total of 50 basis points. again, that will depend on a number of things. first of all, where inflation is going and the labor market is a key component of that. how? it is about wages. we still have the labor shortages here and there and even places where you don't necessarily have labor shortages, companies are holding on to workers to keep wages elevated. wages are still rising and that is feeding into inflation especially for services. that is something the fed has a lot of difficulty leaning against. i think wages and things like insurance costs and the process of seeing shelter costs cool would be very important in terms of the fed feeling forncomforta with lowering interest rates ther

there. >> did are you believing they will lower? >> i don't believe that. the fed is focused on monetary policy and should not be persuaded by anything going on in the political spheres. >> how is it connected to the inflation piece? >> it is not connected about payroll, but i would be watching hours. if hours start falling, that means companies are in trouble and instead of letting people go, they are cutting hours. it is the inflation flow through to consumer prices. >> okay. we are going to leave the conversation there. we appreciate it. we will see what happens at 8:30 this morning. coming up, we're going to get you ready for the jobs report which we were just talking about. we have a preview next. plus a possible link between ozempic and an eye condition. we'll get you up to speed on the rahtheotgoli r. sct tteb

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welcome back. check out the price of crude at this hour back over $83 a barrel, up nearly 16% now for the year. but still in a decent place. decent. but now it may not get decent. we are coming back after that live shot of new york city. easy day after july fourth.

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new study finding that people taking ozempic and wegovy may be at an increased risk of developing an eye condition that

can cause irreversible vision loss. the author saying more studies are needed to confirm a link. joining us is the scott gottlieb. i assume it's so widely used now, we would know if it was any type of significant percentage as far as a risk, but, i mean, even a slight risk of something like that seems like it's something that we need to talk about or think about. >> i think that's right, joe. i think that this was very prevalent and we would see it given the population of patients now on these drugs. this was a well done study by a group of physicians in massachusetts. they did a study of this condition in patients who are on the drug and then decided to go back and look at the hospital's records to see whether or not there was a correlation between patients who were taking these drugs and a higher incidence of

this really devastating side effect where you get ischemia to the optic nerve and can lead to blindness. that doesn't cause a relationship for these drugs. they need to do better studies now going forward and i think this is going to trigger further investigations and it's also a randomized study under way by novo looking whether this condition in these drugs enthat study is probably going to be amended to look for this side effect as well, i would imagine. so there is going to be a lot of investigations going forward. i think regulators will get to the bottom of this and i imagine they are looking at this study. they are looking at the care of the physicians took in doing this study. it is a little bit perplexing because these drugs are thought to protect against inflammation and be neuroprotective.

it's perplexing what the exact mechanism would be. we do know that vision disturbances are already on the labels of these drugs. when you get rapid correctses of blood glucose can call visual changes and there is a correlation of diabetic retinopathy. we knew there was a connection but not this disturbance. >> wow. a lot to chew over. i know it was initially for diabetes and the mechanism that we are using here and there is already something diabetic rhet. you mentioned it seems to be actually a positive for neural inflammation, so that doesn't make sense, but when you have a

drug, you're using one thing, it works really good for another thing. all of a sudden, everybody is taking it for this other thing when you're not sure why it's working and the mechanism isn't playing out, we haven't had it 10, 15, 20 years and we don't know and now we see something like this, i mean, would you caution people that they need to lose 10 or 15 pounds, this might not be the way to do it? >> well, these drugs have been around a long time as long as the iphone so gives you a sense how long the drugs have been on the market. typically when these used historically was for diabetes. at these much higher doses, i think we will find more side effects. i don't think nobody should be taking this drug unless they are properly indicated for. i've had concerned about the compounding going on because i think that is more marginal use. you look at the average bmi of patients on the prescription drugs and nova reported data

recently that is quite high. i think the patients getting the prescription drugs by and large are properly indicated for it because insurance isn't going to cover it otherwise. i think with the more marginal utility 6:00s happening is on the more compounded drugs and not all of it but i think more is happening there with patients going online and getting prescriptions even in instances they might not have bmis that put them squarely within the target. >> just talking about bmis. what kind of bmis are you talking about? i'm not -- >> asking for a friend! >> i'm asking for a friend. what kind of bmis, something over 30? do you need over 30 to take this would you say? >> yeah. i think that is the labelled indication but the average bmi, when nova reported data and this is a little bit of a while ago so i suspect maybe it's come down as utilization has expanded. it was in the high 30s if i remember correctly. >> high 30s?

>> i would like to see what the average bmi is of the some of the compounded versions. i would suspect it's lower. >> yeah. yeah. 25 to 30 is sort of -- what is that called? you're not really obese but you're, like, getting there, right? 25 to 30? what is 249? that is pretty damn good, isn't it? you're laughing about it. that is solid, isn't it? 249 if you're a work in progress? >> that's good. >> you would say good? >> what the correlation between height and weight but i can't any more. >> okay. >> high 30s, whoa. yeah. push yourself back from the table when you're listening to the band! the band is talking to you if you get one. we know one guy did not listen to the band. doctor, thank you. good to have you on. >> thanks a lot. >> okay. >> okay. it is just past 7:00 a.m. on the east coast.

you're watching "squawk box" on cnbc. happy july fourth if you're just waking up with us after firecrackers and other things last night. becky is off today. we may have our own firecrackers later. we will be getting the jobs report at 8:30. firecrackers now out of uk. historic outcome in that country. all labour party winning. labour party leader will be replacing sunak less than two years after taking over as prime minister and will control that country for at least quite some time and maybe a little more stability in the uk. parent company of saks fifth avenue is trying to navigate through lowing command and rising competition from fast

fashion browns and hbc buying neiman marcus and bergdorf goodman. amazon will be holding a minority stake in the combined companies. a hacker getting access to openai internal messaging system last year. they lifted the information from online forum but didn't into the makers of chatgpt houses and builds its ai. the company told the board about the breach but did not share the news publicly because no information about partners or customers were stolen. that was the rational. >> you probably seen it go by at the bottom of the screen. yikes! bitcoin trading at its lowest level since late february shedding more than 170 billion dollars in market cap just in the past 24 hours. the rest -- not 55. it's bounced. but down over 5% and -- that

chart. does that really show 70 to 55? terrible. the colors are pretty. >> i had the problem last week and trying to show a story. didn't work. >> june employment report is due out in about 90 minutes. steve liesman who we hope will remain employed here will join ug us. what did we do last week? >> 272. >> 200 is good. >> we are talking about a modest -- >> nobody is hotter than 200? >> nobody knows. >> nobody knows. if we did, we would. >> i'll tell you why. we will talk about this in a second. we are looking for a modest slowing in the jobs market. some fed officials are saying it's time to look out or pay more attention to the possibility of a broader slowing in employment.

unemployment unchanged at 4%. it is up from 3.5 but it's still at a low level. average hourly wage a lot of attention always paid to that because we want to know if the job gains are inflationary and 39 coming down and a good development here. some of the signs we have seen of slowing, ism employment service below 50 five months for now and some rise in the jobless claims. the reason why nobody knows is slowing immigration which is a major wildcard in the jobs numbers ever since the pandemic in both increases both legal and illegal immigration and partly explain the u.s. has posted job gains far above the growth of the native foreign labor force but the numbers have come down sharply where morgan stanley is riding this morning. quote. they see three or four month lag from what has happened at the border recently to slowing job growth. some fed officials noted with

inflation above target but coming down that it's time to start paying more attention to the employment side. they sayeconomy is closer to a place it can't count on the strong rise in rates. here are the probabilities out there. 74%. any way. we go into this meeting with little chance of a july cut but 75% of one in september and 71% probability of a second cut by december. wage and labor data doesn't need to see weak job growth if there are enough bodies to fill the jobs. so do so at ways it doesn't push up inflation. joe, the immigration thing, i don't think anybody has a good count of it. i think the, more or less, once adjusted, the payroll numbers are giving us what is happening but we don't know about the supply labor. >> well, it just seems like it's a really good problem to have that you're saying we may be able to shift our attention back

to employment and we are only at 4% unemployment. i mean, if inflation is really giving them the opportunity to say, okay, we kind of have, like, we are doing what we need to do with inflation, now we can refocus and make sure we keep full employment when you're starting from 6 or 7 or 8 or something like that. isn't 4 pretty good? >> it is good. if i could just could we forget about the discussion we had about the body mass index? i went to the stop and shop to get fried chicken to bring on the boat to have for july fourth. know that is bad. >> fried? >> i don't think you should be sharing this information with the viewer. >> once a year we do this. >> is there news you can use? >> what else besides that? >> potato salad. >> potato salad? >> none of this is good! >> but it's good! >> chocolate shakes? >> no. >> dome nuts? -- doughnuts? >> no doughnuts. >> when i talked into the stop

and shop there was a big sign there saying we are lowered prices on cross out hundreds and dozens and thousands of products. >> lowered prices? >> yes. >> gougers! >> i think it's interesting. i think maybe that is something. >> lower prices on thousands or just saying that? >> shrink flation. >> do you have all crappy dark meat? >> i love dark meat. robert is to mad about that. what did you eat? hamburgers and hot dogs! >> he is furious we are talking bmi. >> is that what he is mad about? >> could we get a shot of him in the control room? let's get of shot of cuteino. >> we will give you all shots of ozempic is what we are going to do.

>> i should have had the fried chicken. i'm sorry. >> we get the jobs number at 8:30 and see steve again. plead guilty to a felony trial or go to trial? boeing has until the close of business today to respond to the doj about what it's going to do. oscar munoz will join us to talk about that and much more. then later, frank luntz is joining us on the race for the white house and new polling results he has got and talking to people and a unique perspective on all of it. power e*trade's easy-to-use tools, like dynamic charting and risk-reward analysis, help make trading feel effortless. and its customizable scans with social sentiment help you find and unlock opportunities in the market.

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box." today marking boeing's deadline to plead guilty to a felony fraud charge or go to trial against the justice department because of a door blowing out. a former airlines chairman and ceo and now a cnbc contributor. oscar, i'm putting you in charge of boeing. you get to make the decision. what do you do? >> that is a nice hypothetical. good morning and happy day after the fourth. that is a hypothetical that i don't think anybody wants to be part of for sure. what a difficult situation for them. put it behind you, right? plead guilty and work the plea deal and pay the fines and move forward, or, you know, take a chance on a very high profile, you know, court case that is going to last forever and will continue to drag your brand through the mud and, of course, you're looking for a ceo, you're looking for your customers to regain their trust and a whole

combination of issues and it's a really daunting one. i'm not a lawyer, so i can't talk about that but it's a clearly difficult decision. if i'm in charge, i don't know. i don't know what i'd do. i don't have all of the details. >> here is my question. what do you think the brand damage is to pleading guilty? what does it do -- i don't know. contractually. are there key man provisions in any contracts with different airlines or others who say, okay, if you are a convicted felon, although i know it's a corporate felon, that somehow could undo deals or other things that have been made in the past? >> yeah. there's a host of downstream effects. clearly -- you know -- like everything else, news circle is what it is and never fades and you'll always be referred to as convicted and have all of those references but you can get on

with life and depending on the conditions, you can somewhat manage. the conditions aren't great. you have people in your offices for a long period of time. you have a lot of excrete knee with regards to your continued government contracts. but all of those are somewhat manageable it is the same things you're going to face if you're convicted. and so there is a roll of the dice. the same things are going to happen if i get convicted or not. do i just go ahead and do with the very expensive trial? again, it is very, very complicated decision to make. >> things definitely -- after the initial two accidents, you know, just killed a lot of people bad. the worst thing that can happen. so you get on probation where you know that you're going to be watched very closely and you need to imply with whatever it

is, if somewhat stringent safety regulations. the bolts that weren't even put on. it seems you don't need to know a whole lot else to see that you could make that stick in a trial, don't you think, oscar? how does something like that happen? there's other things, too. that is not the only thing but that is the most flagrant thing that shows that they did not take the safety protocols seriously. >> again, none of us are attorneys, i don't believe. anything could happen in a court case. facts can get presented in very different ways. your particular example, the bolts, there could be a host of different situations that are specific to that plant, to that facility, to that time slot of the people that were working that could be seen as an isolated item. everyone is not a wholesale culture.

yes you bring in other things and hundreds of whistleblowers that are showing up. clearly the facts are not with you but none of us on this call or even listening are privy to all of the information that is there and we all just see the headlines which tend to be sensational. so i don't know those facts and if you're comfortable with those facts, then you go ahead and go for the court case. but i don't know. fighting the u.s. government, i don't ever think that is a really good idea because it lasts for so long. again, dependent on what the plea deal holds, if i were a betting man, i'd go 50.005% in favor of that there is going to a plea deal. now that one will also have to be approved by people and unless it's really a tough plea, there is going to be a lot of pushback certainly from the affected families for lack of a very specific case. even going on the plea deal route is not an easy one and it

will be brought with more issues in the near future. >> oscar, separate question just on the airline industry for the summer right now. it appears that there has been enough capacity put on or maybe -- you could argue maybe too much capacity insofar as prices are down marginally in terms of where we are right now. do you think they are going to go down further? what is your take on where we stand from a capacity perspective? >> you know, it depends. you know? it's weird to be able to talk about pricing now that i'm not part of the industry specifically. but you're right. i mean, prices right now, domestically -- it depends on where you're going. like anything else. >> right. >> europe is down because of a huge amount of demand and plenty capacity. but comparatively speaking to others, it is down. it's hard to tell. it is all such competition. >> then, finally, what do you

make of the competition now in delta just sort of thrown down a new gauntlet. you probably saw last week or a week and a half now, this new delta one lounge at jfk. they are spending a lot of money to put these now in l.a. and new york and other places i think as well. united is either going to try to catch up or says it's trying to catch up in this sort of super premium space. does that make sense to you? can you make the math work? what do you think? >> well, i have flown delta one and a local service. the clubs in themselves have just improved mightily. see this across the board. i haven't seen american new clubs but delta and united are spectacular the ones that are being rebuilt for sure. the delta one experience with, you know, you have security function that gets you into the

club. once you get into that main club, when you have to get to your gate, it's still kind of far away. and so, yes, all of that makes a difference. it's very special. you get into a special door. global service has that same for united so they are kind of equal in that regard but that is a biased statement. here is the big issue. you still have to fly the airline appropriately. my delta one experience was great until i got to the flight which was delayed over an hour and a half which happens to everyone. >> do you think the lock in effect is real? meaning people are not sitting on kayak trying to choose the lowest fare or the scheduled flight that makes the most sense? >> yeah, no. this industry is always is not as sticky as you think. it's sticky if you're a frequent flyer in a particular location, meaning out of houston or chicago or any of the united hubs or atlanta for delta, you're going to be beholden to

that because you can get to the most places the most time on your schedule and you're beholden to them. broader like l.a. is a market where shares are widely distributed so i think it makes a difference this but, again, it depends where you're going and when you can get back. if you're going from l.a. to boston is the only way i could fly to get there so i chose them that day. i can see how both global service and i suspect concierge key is an important one and, by the way, on a gentle note, something that even someone like southwest is going to have to consider because to your point of stickiness, customers are actually liking and wanting more of this. it does have an effect for sure. otherwise, you know, nobody would do it. >> oscar munoz, we appreciate your perspective on all of this and we issue you a happy july fourth and we will see what boeing ultimately decides to do or not later this afternoon. >> i'm sure we will be back to

talk about that. have a good one, everyone. bye-bye. coming up, putting a.i. models to the test. talk about the stack. the stack. like who is best. >> stack rank 'em. >> yeah. >> rank 'em. >> love that. deep water asset management is publishing a study which artificial platforms are the most accurate and details are next. check out the futures ahead of the jobs report. dow down 38 points and s&p off a little bit. nasdaq is up. see that? that's like the gap in my health insurance. gap in your health insurance? yeah, it didn't cover everything when i got hurt. good thing i had aflac. (aflac duck) hmmm the cash i got from aflac helped pay for medical expenses, groceries, rent.

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now the answer to today's aflac trivia question. dupont is the answer. google will win the a.i. arms race this is according to a

new study published by deep water asset management today. the company tested the following with the same 40 questions to determine who would give the most accurate answers. joining us now with more is gene munster, deep water asset managing partner. i want to read one quote and exactly what i thought. what is most important for the future is the ability to allow third parties to create unique deep and conversational experiences that deliver insights beyond search. that doesn't exist today. that is what i've seen. it's like, thank you. but i could have googled this and put it altogether and googled it a couple of different places and gone to the sources, stuck them together, hodge-podge and you are giving me know insight and no analysis and you're not instilling anything. are any of them good? they are not impressive to me at this point. >> i think they definitely do an important role in terms of

getting to the answer more quickly but i do think we are in this still early stage if you kind of a scale 1 to 100, we are probably in the teens in terms of their ability to really deliver something that is unique. so i want to break down the topic in to two pieces. number one, you led with our belief that google is going to win at search. that is a powerful statement, given some of the concerns investors have about the 185 billion in revenue they are doing this year in search and that potentially getting displaced by other other search products and openai will come out with a chat box this year but our findings are that the intelligence of these models, even call it 15 on a scale of a 100 right now, intelligence is comparable and why that is so important for google investors is that if it's comparable to openai and claude and that means the 4 billion actually daily

search users aren't motivated to make that switch. i think about this topic in two pieces. google search franchise in tech and no need to worry. second is what does that mean for if the search kind of opportunity and that commerce opportunity gets taken off the table, what does it mean for the other models? ultimately, you said that a.i. chat bots need to make a leap forward than they are doing today to give simple answers to the point you're giving that you described this deep conversation and why is the deep conversation important is because the true unlock with chat bots is getting to an insight that you wouldn't get from a single answer. and so i think that chapter one going well for google and will continue, because it's smart, comparable to the others. chapter two is still wide open for these bots to add much more value than we are getting today. >> i was wondering how you could

make a determination of who was going to win when we don't know who is going to be able to get to that next step that you just mentioned. you think because they are already in trends with the search users that -- >> two different -- >> even if they are comparable to the others because of their existing position that makes them the eventual winner? >> we are thinking about two pieces to the topic on the search side, that is correct. since gemini is comparable by our scoring is within 4%, all of the models are basically comparable intelligence. and since it's comparable, there is no real motivation and not 10 x better for the habitual search behavior we have around google to change so that search piece is in a good place. then there is another part of the conversation that emerged in our testing which is that what is happening in search and will continue to be generaive search

is not chat baots has not happened. i think is to build a model with a conversation piece that still didn't exist today. >> can you just break it down for other functionality or did you not look at that? >> we did. basically, i mentioned their intelligence are comparable. >> no. but i use this stuff all the time. if i was going to write something and i don't do this -- we actually don't do this professional, but if you were going to write something or play with writing i would use claude or an thropic. you feel something. >> no yt for your column. >> no. if you were trying to write something. >> don't do that. i would be able to tell. >> gemini would be the third on

my stack if i ranked them. >> stack rank. >> if you wanted to use numbers or to create charts or to create tables, you might actually use -- i think you'd use chatgpt first of all, of those things? >> probably. >> in terms of what they are good at. i mentioned their broader intelligence is similar but like you said each model does better. google is best at commerce. a category of future projections and that tend to be gpt and grock did well and claude does more with those writing types of features. so each model does have a strength. grock we describe as a true personality. it doesn't give the bullet point responses and it's not scientific so just that is more of gravitating toward that. their broader intelligence is

relatively comparable. >> okay. i just want to know, a, when -- really, if it makes that next leap, because -- so the chips are fast, really fast. when does it make that, you know, insight? we are all going to hear this sound. there will be a sound, all of a sudden, when we get -- because that is going to be not a singularity necessarily. that is a whole new thing. >> exactly. >> how long? ever? >> well -- >> we got to go. >> the way we think about it, it's going to come. it's probably by the end of the decade. don't use elon as a good benchmark. he says we are within a year or two but it's probably within five or six years and it's going to happen. everything we are talking is general intelligence and it's a step function, a step function improvement. >> quantum? >> quantum that would be?

a.i. has been around. computer-aided design. that was all sort of, you know, people said that wayz was an a.i. program. until you get to the next thing, i haven't seen it yet. i read. great. oh, great. you googled a bunch of crap and you stuck it altogether. that's not that impressive. thanks, gene. >> thank you. coming up, we are going to talk politics and the race for the white house. frank luntz will be with us. it's 30 years since amazon went into business and three years since andy jassy is the ceo. which affected my hormones and my metabolism literally just crashed on me. i've tried everything and starving myself just didn't work. what appealed to me about golo was that it focused on losing fat weight

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coming up, frank luntz will join us as pressure mounts on president biden to step aside in the presidential election. later, the june job report will be released. it's the first friday of july. the numbers and the instant ahd "ait ction is strgh eaonsquawk box." with powerful, easy-to-use tools, power e*trade makes complex trading easier. react to fast-moving markets with dynamic charting and a futures ladder that lets you place, flatten, or reverse orders

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welcome back to "squawk box." for more on the 2026 election, joining us right now is polster' political strategist frank luntz. great to see you, frank. we want to get your thoughts a couple of days now out from the debate. we are going to see president biden tonight. george stephanopoulos will be interviewing him. so important. >> i thought we would have two nights. conventions don't matter. the two debates, i don't think there is going to be a second debate. that tonight's interview could actually be even more important. if he doesn't come across strong, focused, and, most importantly, on the future, this is the single biggest complaint that all voters had regardless of whether you're republican or democrat, all they did fight about the past. what are you going to do for me

now, next month, next year? >> you mean what can be unburdened by what has been? >> oh, that is a good line. i'm not going to -- that's a good line. it's philosophical. >> you're seeing some of the donor class already step away. >> by the way -- >> from the president. >> i know you're a news journalist. not just a host. the donor class is abandoning him. the members of congress are afraid. the governors are afraid. i talked to them and they are trying to figure out what the hell we can do. the donor class is not afraid and they are shocked at what happened and it's continuing. >> okay. before we get to the prospect of whether he gets replaced or he steps away, just what is he going to have to say tonight? if he puts on a good performance, does that change the dynamic? and, also, george stephanopoulos has to push him and push him

hard. >> he has a lot of pressure on him. i wrote a couple of things down. he can't say i had a bad night. >> he has so say i had a bad night. if he doesn't say that, what will he say? >> because -- i didn't do what i wanted to do. i didn't say what i wanted to say. i communicated. it was such an important night and i didn't communicate the values, the priorities that are so essential for this country. >> how -- >> that's how it's started. then i would do three questions. as reagan did are you better off today than you were four years ago? i'd ask the question, do you want chaos and confusion? >> right. >> or do you want stability and predictability? give me three questions like that. then give me the priorities -- >> how do you answer this following question? mr. president, you are the commander in chief of this country there will be real life crisis you have to handle and some of those are after 8:00 p.m. and there will be times you have to be up at 2:00 in the

morning and you have to make a super critical decision about american lives and folks and military folks who are out there. >> is there anyone who is watching who has not gotten a cold orl not gotten sick on the day that you absolutely had to be healthy? on your wedding day? burying a very close friend or family relative. that is what happened. >> you said not to use "i had a bad night. >> >> you don't use that's words but you have to plain it away. i'm a word guy. the precise words he uses absolutely does matter. >> to the extent there is a side conversation happening right now about whether he should step away and if he does, who would replace him? how do you see that? >> as utter chaos. it has to go to the delegates' not a nationwide primary. there is not time. >> you don't think he and joe

biden have to anoint somebody? >> i don't believe he is going to go. i trust those who say that his son and his wife are adamant, as is he, that he is -- i don't believe this, but he firmly believes he is the best candidate -- >> can he say he has the delegates? >> why tonight is so important. >> even if he screws up tonight, you think the pressure could be so great -- do you think he has said to two people i may or may not stay and puts on a brave faces for everything else but do you think he has sdconceded it doesn't work out? >> not yet. >> the reporting is that he is kind of implied to them that if i don't really -- for the next two weeks i could be gone? but if he doesn't want to go, can he really stay? could he make the decision to stay without donors, without -- even if schumer and pelosi say something, could he still --

>> when he nannounced this, i'm going nowhere. my voice right now. this is an important interview for me and i'm having trouble right now. these things do happen. we are human beings. and he needs to be able to communicate that. your challenge is a good one and that is what stephanopoulos should say, but if he is determined to stay, he can stay. if he waffles, then they will push him out. >> if he gets pushed, do you believe the vice president steps in that role and the democrats ultimately support her in that position? or do you think we are talking about a completely different team? >> once again, who is going to step up? i can name you half a dozen people who would be better than her right now but i'm talking to them and nobody wants to challenge her because nobody wants -- okay. i'm going to be direct. >> yes. >> god help me. you may not have me on the show

again. nobody wants to knock out an african american woman and be held responsible for that and that is the truth and maybe i'm going to be criticized when i walk off of here but she's got such a strong position because of that and here is the issue. her favor ability, she is the most popular vice president since dan quayle ahe was the unpopular vice president than -- >> is there somebody you would pair her with you think would make them unbeatable team? >> i think of the governor of maryland wes moore. i think of the senator from new jersey cory booker. i think of the single best retail politician mitch -- would do a better job than she would because they get the public. it's not funny to them. it's serious to them. >> you brought cadets from west point today and usb tyou've bee

talking to them and teaching a class there. where do you tell this class where we are in america? >> they are telling me where we are. i'm pessimistic. you du bois have heard me say they are optimistic. therapy committed to service, sacrifice, courage, and conviction. they are committed to doing the right thing for the right reasons at the right time and the right way. i would ask our elected officials you show me why you deserve the support of west point, not the other way around. these are the finest young men and women. they are dedicated to this country and they support the constitution. they don't support the president. they are not there for the country. they are there for the constitution. and they are knowledgeable and they are strong and they succeed. there is no failure at west point. you have to succeed because it's our country and our constitution at stake. i would love to show you the

video. i will tell you last night on the fourth of july was my best fourth of july ever because i was surrounded by people who i so deeply respect and admire. i never served. they serve every single day. >> frank luntz, happy july fourth and we appreciate your perspective on all of this and thank you. >> thank you. when we come back, a lot more coming up on "squawk box." in a moment, amazon under the jassy era and we are talk about about it and where the company stands since its inception 30 years ago. we are coming back live from times square.

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today marks three years since andy jassy toot ceo job at amazon. taking over the e commercial and tech giant from founder jeff bezos. kate rooney is here with more on amazon's jassy era. >> good morning.

amazon has gotten a lot leaner and a tlot more efficient under jassy. ceo's biggest win as profitability and advertising but need convincing that jassy hasn't missed the boat when it comes to a.i. efficient hand-picked by jeff bezos for the job three years ago. jassy been at amazon almost three decades and founded the successful cloud business been amazon. mark and gene pointed out the irony of jassy's success at ceo and actually on the e-commerce side and aws he is known for has seen more challenges. cloud stalled to 13% and bounced back. it's now closer to 15%. amazon was the first mover in cloud but now faces a lot more competition at this point from microsoft and google. amazon's e-commerce margins have fallen in negative territory around the pandemic and bring

down cost per package and delivery times as well. sports is another big area jassy is leaning in for amazon and spending big and getting those nfl on prime and advertising within prime is widely applauded by wall street and seen as a big opportunity. jassy doubled down on health care and expanding into amazon clinics but his team is pulling back on ghost stores that walk out and brick and mortar stores with lay jusoffs the past few y. alexa, former employees tell me this was bezos' pet project and jassy wants to see major improvements on especially when it comes to what it's capable of in a.i. a. >> is still really the big open question for investors who tell me that is going to be jassy's biggest task going forward is to prove that amazon is going to lead in this area. back to you, guys.

>> all right. i'm told we got to go. kate, good to have you on this morning. see you soon. >> good to see you, joe. thanks. yep. coming up, the cost of tariffs on the american consumer. former commerce secretary will join us after the break to discuss what may or may not happen, whether it's a negotiating ploy or whether it is real. we are coming right back. (♪♪) car, this isn't the way home. that's right james, it isn't. car, where are we going? we're here. (♪♪) surprise!!! the future isn't scary. not investing in it is. car, were you in on this? nothing gets by you james. nasdaq-100 innovators. one etf. before investing, carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com (grunting) at morgan stanley, old school hard work meets bold new thinking.

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president biden and former president trump both support tariff policies aimed a protecting domestic industries but these tariffs have significant economic costs, including billions of dollars in expenses for u.s. consumers. joining us now is carlos gutierrez, former commerce secretary and cnbc contributor. it's not just us either. it's not just the last administration. it's the current administration. maybe more targeted, maybe not. we hear what former president trump is saying about 10% across the board. just today, carlos, the eu looking at the way china subsides that ev industry, the eu levying tariffs today and it's everywhere and almost a

fact of life. what are we to think? >> it's pretty much out of control. sorry, george. i have a little bit of -- it's out of control. it's just, you know, people are doing what they want to do. i don't really get what this 10% is going to do for us. we have put tariffs on over the last several years and you look at the deficit. it really hasn't moved. it hasn't achieved its intended goal, but to your point, joe, this just starts a domino effect. if the u.s. can do it, china can do it. you know, the european union's tariffs were anywhere from 17 to 37 which suggests they calculated something. ours were going to be 50 and then we decided it's 100. so it's become this random decision. how much do you want? do you want 70? you want 120? there is no longer, you know, a fundamental methodology that we all agree to use. so this is bad. this is bad. i think he will put it on.

i don't believe it's -- it could be a negotiating tactic for later, but i believe he will do it if he becomes president. >> well, let's just talk about the ones that are already there and some of them put on by trump and left on by biden and new ones from biden. a, do you believe it's a tax that eventually its consumers? b, i would say there is plenty of taxes that we levy with a desired outcome. you know, to try to force behavior in some way. sometimes what we are dealing with china or dumpers, whether it's fiscanorth korea, stihl. you could make the case if it's a tax on consumers it's worth it to let these countries know that it's unacceptable their trade practices. does that never make sense even if it's a tax on consumers? >> you know, as long as it

hurts, as long as they see it as a remedy, as long as it really has an impact, that's what we have not seen is what has been the impact of those tariffs. on one hand, some chinese companies may just pay them. but, essentially, it's the u.s. consumer, right? the. who imports pays for them and they, again charge consumers and, most likely they will mark up their price to offset those tae tariffs. the u.s. government doesn't see a penny. this is all about the economy. building a wall around the u.s. i think we have to think what does that look like in five, ten years we have this commercial wall around the u.s. what will our economy be like? >> carlos, you may be surprised that i'm asking this question. but part of me that thinks that former president trump -- i don't want to say bluffing but maybe bluffing as part of an

negotiating ploy, right? that his intention isn't necessarily to put on tariffs, at least at this scale, but that he thinks by talking about tariffs this way suggests the u.s. is strong and becomes a negotiating points from other things we may want from china. what do you think about that? whether they should score them on the merits what they look on their face what they might actually be in practice? >> yeah, yeah. so it's interesting you mention that, andrew, because that is a well-used tactic and it's been used on us, so i hope at some point we will be using it as well. someone says, look. i am going to do -- i'm going to slap 40% tariffs on a specific industry and we work hard to negotiate and convince them not to do it. and in that process, we give them something so that they don't put 40% tariffs on an industry and in the end they

don't put anything on the industry and we feel like we won. that happens all the time. i don't think that president trump uses that. i don't think that is -- i don't think that would have as much impact as putting in 10% and then using that to negotiate. i think he wants impact. i think he wants a little bit of shock and awe. but this is a very well-known tactic, andrews. good point. >> carlos, i want to thank you for your perspective and wish you a happy july fourth and enjoy rest of that weekend. >> thank you. good to see you all. >> we took you away from the weekend for a little bit. a long weekend for some. >> thank you. >> in the meantime, it is just now after 8:00 a.m. on the east coast. you're watching "squawk box" here on cnbc. i'm andrew sorkin along with joe kernen. becky is off today. the jobs number is coming under 30 minutes. look right now at bitcoin. crypto currency is in the red

today. that coin there, 55,347 dollars. check out crypto-related companies are feeling the pain across the board. the parent of saks fifth avenue saying it will acquire neiman marcus in 2.65 billion transaction and amazon and sales force will also be investors in the combined businesses to be known an saks global. chase bank warning customers it could start having to pay for their checking accounts. in an interview with "the wall street journal," jpmorgan consumer banking ceo saying chase is planning to start charging for some services that are now free of government regulations and take effect in their current form. she says she expects others in the banking industry to also start charging.

i think part of what she is arguing is call your congressman or congresswoman in this case. dow off at 41 points and nasdaq up 7.1 points and ns&p 50 down five points and may change after we get the unemployment numbers. let's get to mike santoli who is at the new york stock exchange. >> most important at record highs. s&p 500 small subset of the big gross stocks levitating on most days. a couple of broad rallies on tuesday and wednesday. the rest of the market kind of turning in place what this shows. s&p 500 up 24.5% over 12-month basis. you see up 9.5% and nothing wrong with that but it shows it hasn't done much for a few

months here area holding in place with the gains and running around 9% annualized gain for the current calendar year. it doesn't look like much next to the gross stock led megacap dominated s&p 500 but still hanging in there. on the consumer side, consumer discretionary a similar story that is the consumer discretionary sector. this is the other version of. . you see they diverged. amazon and tesla 40% of the market cap basket. the rest of discretionary consumer [ inaudible ] softening up a sign of slowing in the economy and saw that in a bunch of the numbers last week. one of the reasons that the jobs number in focus -- look at the payroll process. speaking of the labor market. adp and paychecks five-year chart and amazingly stable and kind of shows you we have been

sort of steady around full employment and, you know, we are up 7 million jobs since the fed started tightening in 2022 but it's been kind of decelerating. not much of a tale here which way the numbers go but interesting we have been hovering near highs for these companies. >> mike, thank you for that. i'm sure we will be talking and watching you throughout the rest of the day. change of the guard in accomplish politics. sky news anchor and cnbc contributor wilf joins us. >> changing of the guard is complete. sunak offered his resignation to the king which was accepted and the king invited keir starmer and he gave a speech and we should have a bit of that to come later during the morning. what stood out for me in keir starmer's first speech as prime minister was that, a, he and

sunak thanked each other underlining the smooth and swift transition of power all taking place this morning. and, also, he said he wanted to govern for rule. of course, a little bit of an acknowledgment there that he has got a huge majority on a relatively small percentage of the vote. let's listen now to keir stamer speaking moments ago. >> whether you voted labour or not, in fact, especially if you did not, i say to you directly, my government will serve you. politics can be a force for good. we will show that. we have changed the labour party, returned it to service and that is how we will govern. country first, party second. >> with 412 of the 650 seats,

63% of the seats in all he has the ability to govern as he sees fit and he'll get straight to it and we expect him to start picking his cabinet today and straight in to action. not just on domestic policy where we do expect overall pro-business administration to form and pro-business policies to come, but on the international stage as well. of course, the g7 gathering is tag place next week. he will be a leader perhaps most powerful domestically at least at that gathering given, of course, he is not about to face an election like president biden or in the middle of one like president macron 6 france or in germany. at least out of international images, starmer is one of the most powerful leaders in the international world. >> interesting. i'm trying to figure out what changes we likely would be

seeing. remember the last time the uk looked seriously at deficits and taxes and spending and everything else, that didn't go well for that prime minister, as you might recall. would it go better now if they really are pro-business? the same question here in the united states. things are unsustainable that we are dealing with. >> liz trust showed certainly in the uk but the other western worlds if you do push the boundaries too much the market might fall out of bed and boring costs just not the shorted ends but the long end of the curb can soar. i think there is a lot to her mini-budget was so disastrous including massive spending on energy bailouts for consumers, as well as tax cuts. and it was the speed with which she did everything at once with no warning to the market that contributed to the way that the bond deals spiked as much as anything. keir stamer versus rishi sunak

they want discipline overall. at the margin starmer wants a few taxes up and spend more versus sunak wanted to cut a few taxes, he said. i think most significant now in the uk for business, joe, is that we have a clear path of what is to come for the next five years. an overall pro-business administration with certainty and ability to deliver and that tends to be a good thing for markets and for business. >> he likes arsenal? have i got that right? >> he does, indeed. he is 61 and makes it old compared to recent prime ministers. last six in the 40s when they took office and two in their 50s. he is 61. but he keeps going to arsenal as much as he can. at least that shows he has got good judgment with the sports best team in the world. >> exactly. i know you were heartened by that.

all right. thanks, wilf. >> thanks so much. >> 20 years younger than our guys. >> 20 years. >> yeah. >> unbelievable. when i said 61 i thought that is a baby. >> june jobs is coming up. we are counting down to the government's latest employment report that is coming up. but next, our next guest will be joining us with a new op-ed he tries to articulate the trap that president biden has fallen in to following last week's disastrous debate. an important piece so don't go anywhere. he is with us after this. (vo) a successful business owner sells his company and takes on a passion project with his son - restoring his father's jazz club, and in the process,

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welcome back to "squawk box." we have futures there to look at and not a lot happening. in 17 minutes we get the jobs report. president biden has fallen into a trap falling what was widely perceived as a disastrous debate performance last week

according to adam grant, a professor. he says it's an escalation of commitment to a losing course of action. he wrote about it in new op-ed in "the new york times" and joining us to explain is professor adam grant, the author of "think again." a long time friend of the program. great to see you, adam. i read your piece, you know, from top-to-bottom with great fascination. before we even get into the dynamics at play with which you describe, i'm curious how you thought about writing that down on paper. because i think a lot of folks who vhaven't wanted to say what you said. >> well, i think that there is no value in staying quiet in a moment like this, right? i think there is such a thing as strategic silence and waiting for the right moment, but a lot of people have been waiting over a year to raise the question of should the president rethink this decision to run and i think after the debate performance it just felt like it was time to

speak up. >> and just to put one fine point on that whether we get into the psychology issues you've described, the president will be on television this evening with george stephanopoulos. is there anything he could say that would change your mind? >> i don't have a clear view of, you know, should he walk away immediately, should, you know, stay in the race, should he wait another few days. i think that, though, the writing seems to be on the wall and i think, at this point, even if, you know, he is able to demonstrate a lot of vigor and cognitive clarity there is an open question about whether voters will change their mind, and i think that is a question that needs to be weighed more seriously than it has so far. >> adam, if i could tell you that kamala harris would be the nominee in spite of joe biden and that she would lose as well to donald trump, would that change your mind on whether

president biden should go? >> i don't know. i think it's really hard to say at this point, right? it's july. we are trying to forecast november. that's a difficult task. >> this is really about trump, right? this is really about trump. you think biden will lose temporary restraining order trump so you would run a potted plant, if you could, if you thought that they could beat trump? it's all about the bad orange man for you, is it not? >> i wouldn't have phrased it that way, joe, but, look. i think that a lot of people who are worried about the state of democracy and so i think the big question is -- >> except "the washington post" are more worried about the state of democracy under biden than under trump. you saw that piece, i guess? >> yeah. i did. but look. i think the question here for democrats is who is the best candidate to defeat donald trump and i think, so far, you know, what i'm seeing from president

biden's advisers is they are more trying to focus on the question of should he run or should he not run as opposed to asking is democracy is the line, who is the best person to save it. >> adam, speak to this. in the piece you talk about what you call a trap, the escalation of commitment to a losing course of action. you say that is a formal name or a technical name. walk us through that thinking. also walk us through that thinking in terms of the team that surround him and to the degree you think their credibility is in question if they pursue this path. what happens later if, in fact, they have to switch? >> okay. so escalation of commitment in the last half century i researched is the finding that when people are facing possible or likely failure. instead rethinking their decisions, they tend to double down and invest more and they end up throwing good money after problem. the biggest drivers of escalation are not economic. they are emotional.

it's about ego, identity, and imagine. so we have heard president biden talk about how he is a fighter. he doesn't want to feel or look like a quitter. i think that is potentially the wrong frame for this decision. instead of thinking about it as a loss to withdraw, he should be thinking about it as an opportunity. not just to pass the torch or but to ignite the flame and be a selfless steward for the neck generation to rise. >> the complication he is surrounded by a group of people who may not walk away as a winner. he could walk away as a winner potentially as you think this is all perceived but the team around him ultimately are not going to have a job, right? and they are going to have the power they once had. sort of this interesting sort of team dynamic and those around him, i imagine, whispering in his ear as well. i'm curious how you think they should be thinking about this? >> i would probably ask them to think about their own reasoning.

we have heard from team biden over the last four years that they are upset with republicans for, you know, quitting their own jobs over, you know, what might be the right thing to do. and saying, look. we are going to back trump because he has the base and we want to stay in congress. so this is a chance to reflect on do you want to make the same mistake? or are you actually going to take the high road and risk your own job for the good of the country? >> adam, i don't know if you read, but reed hoffman put out a note last friday effectively saying democrats need to rally around the current president, that actually republicans -- you were talking about loyalty, joe -- that republicans, when there is a problem, they rally around their people, they don't walk from their people, and that it's just a classic sort of democrat thing to do to sort of, you know, drop one person and go to the next. >> stay in power, exactly.

>> no, not to stay in power. >> for the party to stay in power. doesn't matter who the figure head is. how long has joe biden really been in charge any way? >> you really think that republicans are rallying around that person so they don't stay in power just because they are loyal? we can have that debate a different day. adam, just speak to the extent there is a debate happening in the democratic party and you do have people, donors like reed hoffman on one side saying that the party needs to rally around him a and reed hastings on the other side saying he needs to step away. >> well, look. i don't think this is a question of philosophy at this point. it's a question of strategy. right? the question is who is the best candidate to rally behind. and my worry is that that discussion is not getting the attention it deserves. i think there is a lot of discussion about polls right now. i think what we need are not pollsters but forecasters. a group of experts and there is a whole community. people who compete in

tournaments to do this, to try to figure out what is likely to change in the next four months. and what is going to sway voters. and i think that too much is around here is what republicans do. so democrats need to follow that lead because it's effective. and there should be a much bigger emphasis on, well, what are the likely events between now and november that would ultimately effect probably the seven swing states that will decide this election and who is the candidate that is going to put the democratic party in the best position to end up on top. >> have you met any pro-trump -- you got about half the country is backing him. have you met a pro-trump professor either at penn or elsewhere? do you know any? it's not correlated with the kind of stuff we saw a couple of months ago, is it, in terms of, you know, a lot of the major ivy leagues didn't comport themselves very well during the -- after october 7th.

any correlation there? >> i've interacted with quite a few professors who are plan to go vote for trump and i do think that number has gone up since we saw the presidential testimonies in congress and what we have seen as an ineffective response to the tragedy and terrorists attacks of october 7th. >> hope so. >> but still a pretty small number from my interactions. >> adam grant, thank you for joining us. the june jobs report, economists expecting a gain of 200,000 jobs last month. we will get the numbers and the instant market reaction in a few minutes. you corporate types are still calling each other rock stars. you're a rock star. we're all rock stars. oooo look look at my data driven insights, i'm a rock star. great job putting finance and hr on one platform with workday. thank you! guys, can you keep it down. i'm working. you people are (guitar noises). hand over the air guitar.

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up next, the number of the morning. we are just a few minutes away from the june jobs report and we will have it for you after the break. stay tuned.

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welcome back. we are approaching the government's june employment report. let's bring in our jobs panel.

elizabeth is director of special initiatives at the roosevelt institute and stephanie is a cnbc contributor. our own steve liesman is back. to complete the six box how are we getting any decent analysis with less than six? >> five is right. >> five. >> five? no way. >> if you get to five, go to six. >> you got to go to six. i'd like to go to nine, if we could. let's start with rick. steve says 200. where are you? >> 225 to 250. 225 to 250 here. >> steph? >> 190. >> 190? douglas, your comments? >> 197. a little tick up on the unemployment rate.

>> we will get the rest of the estimates in a second. i'm heading down to you and get everybody in eventually for the actual report, and sometimes it seeps out kind of slowly, rick, so why don't you take it away. >> absolutely. i know everybody is going to be debating the breakdown betpart-e and full-time. june, jobs, jobs report. non-farm payroll expands 206,000. that, of course, is benchmarked against the rearview mirror which, right now is going to be revised minus 111,000 is the two-month revision and if we look at the unemployment rate, he nailed it. our buddy nailed it up ten-tenth of a% from 4% to 4.1%. 4.1% is the hottest. we have to go back a ways. last time we were at 4.1% was

november of 2021. you have to go back to october of 2021 to find a higher rate which was 4.5. let's look at the hourly earnings from a month over month perspective. up 0.3% of a tenth and one-tenth lighter in the rearview mirror and exact expectations. last month was up four-tenths. the month before that, april, was only up two-tenths. you can see we are kind of running right in between. if we look at the year over year perspective on hourly earnings, 3.9%. that dips below 4.1% in the rearview mirror and let's look at the way back machine. 3.9 equals april of '21 to find a lower number than that and you have to go back to may of '21 when it was 2.3%. now, let's consider average hourly workweek. 34.3 and exactly what expected

and exactly as last time. if we continue to look over last 12 months, it's the highest frequency 34.3. the labor force participation rate is always important. 62.6%. economists and analysts had it right and what they were expecting. it is one-penione-tenth better. 62% is april it was 62.7. last month if you recall was the dip to 62 poip 5 and that was the lowest level going all the way back to january of '23. unemployment rate moved up to 4.1 and u6 under employment rate at 7.4% and that is the hottest or highest since november of '21. response in the marketplace is twofold. initially, it popped up and now it's lower.

ten-year notes 428. 428. that means we are now down a dozen basis points on the week for a ten-year note and 4.63 for a two, which was at 467, you're looking at down 13 basis points on the week. so rather dramatic drops especially considering they were pushing 4.5% prior to the holiday. let's throw it back to the panel for comments. >> you're asking questions and answering your own. >> am i talking to myself while this is going on? >> that's okay. elizabeth, i'm coming to you after i hear what steve decided. >> here is what i was able to calculate. 74% of the jobs came from government and health care and education. so that is where the bulk of the

jobs are. the rest of the jobs not doing quite so well. leisure and hospitality a big source of job growth just 7,000. retail down 8 and a half thousand. temporary help minus 48 tho you thou -- 48,000. a lot of local government jobs seem to still be hiring in those places or those municipalities. seem to still be hiring in those places or those municipalities. hospital is up 22,000. i think the other data rick was talking about. wages year over year went down to where it wasin the prior month or two months ago. plus the revisions. again, this idea of gathering weakness but not being weak, i think, is the theme from the payroll report. >> elizabeth, the floor is yours. i'm sorry i didn't get to you earlier. >> that's okay. my forecast is 195. i think we roughly were all

around the same area. >> you should have said 203 or 206. >> i agree with the cracks underneath the surface. look back at the last week of gate gdp 1.5% and lower than expected. slowing wage growth at 3.9%. steady job gains, something we would have been happy about in 2019 but slowing. i think the -- should give the fed the confidence they need for a september cut. things are steady and we need to keep it that way. >> douglas, i mentioned to you it's a pretty good position to be for the fed to be able to refocus on employment with inflation coming down, when we are talking about refocusing on employment from very low levels of unemployment. that's pretty good, isn't it? >> well, i think the fed is now back to being -- the fed.

they had a couple of years to focus exclusively on inflation. now they have to weigh the tradeoffs and how much of the real weakness we are seeing in the household sector will spill over into the labor market the next couple of months. i think that is a real tough call. but, you know, the fed doesn't like to move in election years. but i think in this election year they are especially low to move and set up expectations for a single preemptive cut it looks like after the election. now i think the issue is why do they cut and not when. if they have to cut because of a material deterioration in the economy they can do that before the election. they can't make a preemptive cut before beforehand. i expect them to stay on hold until after the election. the inflation is between 2 and 3 and not a mandate to go lower just yet. >> stephanie, what would market participants take away from this? at least we got a cut coming? >> i think we definitely have a cut coming and i've been in the

camp that we wouldn't see a cut this year but we have seen the economic data points over the last couple of weeks see a deterioration and i've been on the growth in the economy and it was the right call but we are absolutely seeing slowdown and mix in housing. the ism services fell five points month over month and is in contraction two of the last three months. across the board, jobs, initial claims are up and adp is weak and so nonfarm payrolls today with the revisions i thought was very soft. not a surprise based on all of the other data points i just mentioned. but we are seeing a slowdown in the economy, joe, and that is helping inflation but we better not slow any more because then we are going to be in real problem territory. >> rick, we have been increasingly having a conversation about inflation and the election coming up.

it's a little bit concerning because most people think that i guess now we can't assume it's president biden -- but both democrats and former president trump are talking about inflationary things. are we back to raising rates in a couple of years? >> you know, that's a really good question. to me the conversation we should be having. when i talk about inflation with both administrations, no matter when is at the helm with with regard to the democrats, what i see isn't necessarily new programs. i think that the amount of spending is finally reached the average american, the average voter understands that we are over our skis in that area. i'm talking about the welfare and the different programs that we pay out for. when you look at baseline spending pre-covid and what it is today, we really have run off the rails there. so the point is that all of these programs just to give you an idea. whether it was child care, all of the programs that we brought

forth and made larger because of covid to try to take care of people's needs during the time when they needed extra assistance, many are reticent in washington and the local municipalities to push that money back down to the pre-covid levels where it was enhanced and i think that is going to continue to haunt us on spending, so there is going to be a big push to look at where the money is going. some programs are going to have to be cut. i think that is the issue with both administrations no matter who wins, that that is going to be a tough job. it's never easy to cut back on programs. there is never sunsets on government spending and that is the problem we are in. >> yikes. steve? >> i have long maintained that the solution to our deficit issue comes from both sides of the equation which is the spending side and the tax side. i mean, we can cut taxes. we have some issues of our deficit related to our revenue side and we have some related to

the spending side. i go down the middle on that one and i think that -- i don't think the public wants the government to solve the benefit -- >> the numbers aren't close. 18% of revenue is what we average and 24% on spending. we have never averaged that. >> 22. >> 24, yeah, 239. >> i'll take your word for it. >> versus 18. right? aiken? >> yeah. well, the problem here is just that you shouldn't be running deficits that are 5% and 6% of gdp when you're at full employment and we are. so it's way out of the ballpark. they have to get serious, as steve said, on how they raise the revenue and how much they raise it. finally, take on the spending. there has been no appetite for dealing with spending growth and that is a necessary thing for better long-term economic growth. we have really had poor growth in the 21st century largely because we have not controlled the federal budget.

it's time to get serious. >> doug, i don't know if you can answer this but i think biden's solution in the debate to the social security issue i think solves it. there was an increase in the amount paid by wealthier taxpayers into the social security fund and it solves the problem. that is the easy one, right? >> that sets the precedent you solve the problems not touching the spending which i think is the wrong message to send. i don't know why. it's easy to tax people but it's impossible to cut their social security benefits. why not serious on both sides of the budget? >> i advocate both, doug. i'm saying that in the panoply of problems that we have, the social security trust fund is the easy one. >> you're right about the mechanics. i mean, social security is easy

to fix mechanically but int's transparent who wins and loses and social security gets hard as a result. medicare and growing rapidly and things have to be serious about. >> but what you can say is if we are going to solve these problems, having people working is a good part of the solution, right? a good thing? >> elizabeth, if you, like, ends up on top of the democratic ticket. i mean, it's wide open. but if you were to be the person in charge, how would you close the gap between spending and revenue? >> you know, i think we have cut four percentage points of gdp on the revenue side the last two decades and a ton of room to make up for there. there are four, five, 6 trillion dollars of tax cuts to make up for and i think some are spending programs where we can make cuts to make efficiencies but on medicare you've got prescription drug reforms that could do miles to solve the problems there.

i want to go back to cutting child care programs and programs that president biden put in place. many of those sunset. the child care programs have expired and we are seeing ing e and i think why you're feeling some pain in household levels. i think we need to spend better and tax much better and much more at the top. >> okay. we are going to end it there. i think it was pretty good for six. i think. you think eight would have been better? liesman? >> i'd like to see the ten box. it's been a while. visually, i think it would be interesting. >> if we put paris hilton. >> no. >> put other people in it just randomly. a good idea. there is seven. could we put jerry garcia in there? >> we hit carl's dog but lucky is now, along with pongo, up at the bridge. >> carl's dog and my analysis is

a tossup. >> or someone saying "that's hot! >> have a great weekend. it's about here. >> speaking of hot. >> speaking of hot. >> andrew? >> you're hot! coming up, we will get into what the jobs report could mean for the fed and essential bankers gauge the economy and what they may or may not do with independent rates. the one what has gotten it right from the very beginning, former fed vice chairman roger ferguson will join us next so don't go anywhere.

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welcome back to "squawk box." june u.s. employment reports showing 206,000 jobs added last month and unemployment rate 4.1% and slightly above estimates and

treasury yields, the ten-year note 4.296 and two-year 4.635. can we just flip the board around? i want to talk about what all of this means for the jobs number -- rather what the jobs number could mean for the fed and what it might mean for equities. there is the board. everything up except for the s&p off still marginally. joining us is former vice fed chairman roger ferguson who is vice chairman of the business council and contributor to cnbc. you read and saw the number. jay powell has seen the number now. what do you think of the number? and what do you think the fed does about the number? >> look. i think the numbers are balanced, you know, a good number. not a great number. 206,000 is not a sign the economy is falling out of bed.

they did some adjustments looking back. i'll say the labor force administration rate is a sign of an economy that is sort ever coming back in to balance. so if i were looking at this number as a policymaker, i'd say, you know, this is pretty good news. the economy is not falling out of bed. we don't need to rush to cut on that side of the mandate. let's measure closely on inflation. i would argue, frankly, while the market think it's a time to go i think it's more 50/50. it's also possible to wait for a bit more data to be certain about the inflation continue to slow. we are seeing signs of slowing but from a high level. from my standpoint, good number. not great number. not sure that it's the all-clear we must cut, that the fed must cut. >> what percentage would you put on a november rate cut? of course, we should mention that rate cut would happen after the election. >> obviously, the fed is very data dependent so i think as we

get further, assuming things continue to unfold this way and inflation gets under control, wwe are going to see a likely cut this year. november might be on the table. obviously we would get a lot of political howling on both sides and consequently but it really does depend very importantly on how things unfold, and we ought to be clear the fed is going to try to be as apolitical as possible, look closely at the data and be prepared to move at any one of the next three meetings if that's how they interpret the data. >> it seems that economists and the market seem to think that september is in the offing. i mean, it seems -- it also seems that the market's been ahead of itself pretty much every, you know, the whole time on this. >> well, that's exactly the point i was about to make. yes, the market, for lots of obvious reasons, would like to see a cut, frankly. you know, i would like to see a cut too because i would say inflation is clearly under control and moving towards that

2% target, convincingly. but i would also argue that, as you point out, the market's been a little optimistic about a cut, and i would say this data, 50/50. not to say zero chance. but i think the market, again, might be a little optimistic, because i don't see anything here that says the economy is really weak. i see an economy that is either weakening or getting back into better balance more sustainably. >> so, here's a slightly different question, because we keep talking politics all morning. obviously, we're in the middle of this election and there's a big question about whether president biden stays in the race. of course, he says he will, but how do you judge this economy today, roger? and how do you judge this economy between now and november? there's sort of one version of judging it on the basis of the way the fed might judge things, if you will, and maybe the way the market might judge it and then there's actually the underlying economy itself. >> so, look, i think the

underlying economy is good. i think it's solid. one might even say strong. these numbers we're seeing in terms of unemployment at 4%, that's not a sign of a weak economy, and certainly, you know, job growth in the 200,000 or so, roughly, every month is not a sign of a weak economy. i think the challenge, however, is, one, inflation has already done its dirty work, and so people think about price levels, not just the changes. so, while central banks say, well, inflation's coming down, average households and certainly middle level households are saying, prices have gone way up. there is a whole cadre of people who feel the economy is not good because they have seen their prices go up more so than their wages. and i think we see the other side of this economy, that it's pretty unbalanced. most of the growth is coming from very -- the top two quartiles or top two quartiles

of income. and, you know, the bottom are not doing so well. and so, i think it is, overall, a good economy, but one that is uneven, and that, i think, creates a lot of the dissonance and noise and the ability to talk about the economy one way or the other. depending on where you sit in the income distribution. >> roger, always want to thank you for your insight on all of this, and we look forward to talking to you again very, very soon. have a great weekend, and happy fourth. >> thank you, andrew. coming up, more on the markets following the june jobs report. stephanie link will rejoin us next. stay tuned. you're watching "squawk box" on cnbc. (♪♪) (♪♪) what took you so long? i'm sorry, there was a long line at the thai place. you get the sauce i like? of course! you're the man! i wish. the future isn't scary. not investing in it is.

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♪ little more than half an hour now to the opening bell on wall street. rejoining us now, stephanie link, for a -- this is almost like we -- they clap enough at the concert, and sometimes they come back a second time. so, you may be on squawk -- it will be like your third time on "squawk on the street." hightower advisors chief investment strategist, cnbc contributor. i don't want to rush things, stephanie, because there's a weekend. but i'm told next week we're getting the banks.

so, it's going to come fast enough. what should we be looking for? that could be the next market-moving event, do you think, for tone? >> yeah. and this is my lucky day to be on twice with you. so, thank you. i think in a gdp world of, like, 2%-ish, you're going to see 8 to 10% earnings growth. so, i think i can't wait to hear from the companies, and always the first ones to report are the banks, and i think that since they are at the front line of the economy, they see everything. we're going to get great realtime information about the consumer and about the industrial economy and the growth overall, and so i'm kind of excited, and in addition, the steepening yield curve should help at not this quarter but net interest income and net interest margins next quarter, so i think maybe guidance might be better than people think on that front. but overall, investment banking fees should be up double digits, m&a completed transaction volumes up 17% year over year in

the quarter, equity capital markets are up 9%, and debt capital markets up about 17%. all of this should lead to better earnings. you know these companies successfully had the results of the stress test. they successfully passed. that's a good thing. and i like bank of america and morgan stanley. they both raised their dividends 8 and 9% respectively. you have a $20 billion buyback at morgan stanley that was just announced. so, i think there's real value, but i'm also really looking forward to listening to what the companies say on a realtime basis. >> and we know it comes after the banks, and that's everybody else. it's going to be earnings season again, isn't it? what are the -- are there macro themes there that you can give us in like a minute? >> yeah, i mean, i think it's going to be very interesting to hear from the industrials, because they've actually held up pretty well, and i want to hear about the themes about power, grit, electrification, the

backlogs, the bookings, that will be important. technology, of course, is very important. anything a.i., but anything cybersecurity is also piquing my interest and a pc upgrade cycle. and on the consumer front, i'm going to watch for discretionary spend and where we see the consumer in that regard. >> all right, steph, and we -- we've seen the highs in the ten-year now, do you think, near term? >> i think we definitely have seen the highs in the ten-year. but i think what's more important to watch, joe, is the steepening yield curve, and i think it's because of the trump possibility of him winning the election and the -- his growth policies going forward. we'll see. we have a long way to go, though, on the political front. >> okay. steph, thanks. appreciate it. sticking around, and before, after, during all the numbers. final check on the markets. quick look. wow. riveting. up nine on the dow.

little bit on the nasdaq. it was not a huge shocker, obviously, the jobs report. >> bitcoin's a huge shocker, though. >> that is a shocker. it was at 54 for a while. looks flat on that chart, doesn't it? looks unchanged for the last six weeks. join us next week. happy friday. "squawk on the street" is next. ♪ good friday morning, welcome to "squawk on the street," i'm david taiffaber with leslie pic and mike santoli. we're live from post nine at the new york stock exchange. you just had a look at futures. joe called it riveting. tend to agree. that's really very exciting right there. but our show will be exciting, unlike, perhaps, what the market looks like. >> you know, that's riveting, even if it's not moving much. >> if it's getting mike santoli excited, then you know you got something going on. let's get to our road map. it does begin with continued job