it's july 11th, 2024. it's a special day here on "squawk box." we have kelly evans here. "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 keflez kelly evans along wi joe kernen. andrew and becky are off today. >> your groundbreaking afternoon show still on today? >> it is. >> a nap before? coffee? tequila?

whatever it takes. >> sometimes i would go do spin class after this and now? >> i believe it is pronounced yout. cousin vinnie. >> should i mention it now? i don't want to do it later on. >> don't tell me. not another one? you've got five. >> no. the market. >> oh, my god. >> i was going to give you a victory lap. >> you scared me. i'm catholic. i wish i had 20. i really do. >> you say that a lot. >> they're the greatest. you showed me a picture of the new one. >> sweet. >> people at home are going, got a cavity? we need to -- >> let's check u.s. equity futures at this hour. the s&p closed above 5,600 for the first time lifted by gains in big tech. all three averages closed higher by 1%. they are not showing the dow. we're close to 40k.

pull the numbers out. we'll go back in a moment. shares of tesla are part of this. up for the 11th consecutive day yesterday. the stock has bounced back from the june 24th decline of 27% to now a 5% gain. one of the remarkable turn around stories. >> the other one that had the similar thing. apple. $3.5 trillion. up $1 trillion in market cap since april. >> that's what people keep saying. apple is breaking out. amazon breaking out above $2 trillion. in terms of watching the technicals, not that i'm an expert. you have the breakouts happen. mike santoli would talk about it better than me. >> we never did get the breadth

we wanted. >> it is so narrow now, it is march of 2000. you look at the profit season. 30% profit growth versus 5% for everybody else. >> it makes you feel like something's not quite right. it is still not loved, i don't think. not as bad as last year. >> the post-pandemic. we will hear from everyone else. pepsi will have to pull back. thank god for a.i. >> this will be good to see. remember, you start off tough with the inflation and then powell has said we have good numbers. we get the latest read on consumer inflation at 8:30 a.m. eastern today. economists are looking for the headline number to rise .1% month over month. you have to look at all of the other numbers.

3.1% year over year. core is expected to hold steady at 3.4%. we'll talk to michelle gerard in a second. she thinks december. >> for a cut? >> yeah. there's an election. if they do it in september, which the way things going, that would be probably -- you can make an argument for that. >> totally. >> they're conflicted. >> you wonder if they are praying this report comes in a little hot to kick it down the road. we are talking about apple. breaking news. eu regulators accepted apple's offer to open its tap and go mobile payment system to rivals. it move helps settle a four-year long investigation that could have resulted in a hefty fine for the tech giant. there's a lot of -- i'm not going to rail about europe again, but if you can't beat them, you know, regulate them

and charge them for it. >> 10% of revenue. nvidia's 10% of business isn't in europe. >> they wonder why they don't innovate in europe. the last big start-up is s.a.p.? >> novo with the weight loss drugs. >> think of what's happened over here in the last 10 years or 15 years in innovation or technology. if you are over there in europe and the land of, you know, great engineered cars and all those things. you would feel inadequate at this point. >> it is funny you bring up the car thing. what are their national banner assets? remember it was nokia? that was the leader for a while. that era's over now. volkswagen. world leading. you have the scandals and now the chinese evs. it has to feel a little

existential. >> porsche. >> ferrari. and pepsi with earnings slightly below. the company said weak demand for the snacks and sodas mainly in the u.s. was responsible and that's its largest market. if you worked here more on "squawk box," you would get a goodie bag. i got one yesterday. i'm looking. for me, it's more important than a.i. that would be a non-carb snack that you want to eat. >> look what i have. i have the pistachios. >> that's all you can have. a few carbs. their problem is caliuliflower.

>> the price of chips is $1.60. $6.60. >> how do you know that? >> because we talked boa which has been cautious on pepsi because the prices have gone up so far that on tortilla chips and people are balking. if pepsi were not already down 10% year to date, the reaction would be worse. >> that is the biggest story of recent years. that is after all these gdp numbers and all these good job numbers, if you are taking home in real dollars and wages less than three years ago, you can't tell someone they're spupposed o feel good about the economy and telling the kids you are getting that instead of that.

>> $6.60. >> how about the mortgage raite or rent? >> you have to pay rent. you don't have to buy name-brand chips. they are pushing back. this will maybe cpi interesting. the economy can survive. for these companies who have been thaenjoying the price hike it is trouble sgl. >> if you didn't take economics in school and why people didn't like economics, you can spend money. say the pandemic is over and you continue to spend and you get the gdp numbers and good employment numbers. if you get 40-year highs in inflation, that's the down side to juicing the economy through overstimulating it. >> the real gdp numbers -- this is what makes earnings compared with real gdp interesting.

if 1.5% is real gdp growth -- yes, lately we have seen real wages out pace inflation maybe the past 12 months. >> is it going to be like this? andrew might have to call in. too much agreeing with each other. andrew? >> line one. wait for the next one. let's get to president biden's re-election bid. senator peter welch did call for biden to exit the race. he said he should withdraw for the good of the country and pointed to kamala harris as a capable successor. chuck schumer is privately signaling to donors he is open to a ticket that is not led by biden. senator responded to axios saying he made clear publicly and privately he supports the president and declined to comment to nbc news.

george clooney said yesterday that biden should quit the race in hopes to beat donald trump. he hosted a fund-raiser last month and y now writes bidhould step down. in the 8:900 hour, we will talk to senator john fetterman. he has called the abandon president biden campaign dump and only helps trump. he is looking for others up for re-election and not saying quite as much. >> any of these individuals that you point to are looking at, in my view, cynically, self preservation. maybe they're in the purple areas. it is all about -- as it always is in d.c., it is about self

preservation. fetterman, who has grown on me immensely over the past year. i have a picture of us together at the white house correspondents dinner. he's in a black-tie sweat suit. i'll not show it. >> i see it with a white tie. >> yeah. he's not going to mince words. >> he is not up for re-election. >> nancy pelosi, this is, to me, is sort of nauseating to read. it's up to the president to decide if he's going to run. he already said in the letter without any doubt that he is running. you know, nancy, you know exactly what he's saying. the only thing you're saying here is it's up to him to decide to pull out. that's all she is saying. >> by saying this, i'm saying your decision is -- >> your decision.

we're not accepting your decision to stay. the only decision we will accept from you is the 84-year-old nancy pelosi and 85-year-old steny hoyer. >> was there a dmchance in 2020r this time around, a clear successor? some going as far as to suggest four years ago he implied he would be a one-term president. >> it is rigged. clyburn. when bernie being the nominee hit the mainstream democrats. >> we don't call it rigged. >> i think bernie might call it rigged. >> and biden did win. he was. programming note. biden will sit for an interview

with "nbc nightly news" anchor l lester holt. the nato conference is significant. one of the opportunities we will hear him fielding the off the cuff questions from media. >> if you saw him on "morning joe" and you saw him give a couple of speeches on teleprompter. there's been nothing recently that's different from the last year. i'm not saying that the debate was a one-off. i don't expect this big boy press conference -- i don't expect him to be any different. i think he will be okay. it will not quiet the people that want him out, but will allow him to maintain. the longer it lasts, the clock is ticking. it really is. it's 6:13. what happened? we usually get out at 6:10. it's you.

it's probably me. coming up, key inflation data. michelle gerrar gerard will be here as well as ed bastian, the delta ceo.

hello. i'm ethereum. and i'm big finance. you look really tired. just calling it a day. but it's 4 p.m. yeah, and i've been working nonstop since 9:30 this morning, so. 9:30. you don't say? yep. you'd want a little shut-eye too if you'd been moving billions around the world. well, actually, i do. you know, stablecoins, nfts, loans.

people can access me 24/7. what? but look, everyone's different. you should get your rest. you'll get after it tomorrow. tomorrow's saturday. [ethereum] monday. you'll get after it again on monday.

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increase by $10 and costco says the increase will affect 52 million memberships. the warehouse store raises its phi fees every five years. you have to hand it to them for holding off. speaking of inflation, the cpi due out this morning. joining us for a preview is michelle gerard from natwest. old friend. is it 20 years, michelle? >> yeah, about. it's been that long. >> a lot longer than a lot of relationships, this has lasted. i read all your notes and got a lot out of it. i was thinking if i were less of an expert than i am, there may be parts where i need you to explain it a little better.

let's do that for viewers. what i mean is there is the headline number and the core number and year over year number and three-month moving average and six. what numbers are you looking for that will tell us whether we're seeing continued disinflation that chairman powell wants? which number is the most important? >> you know, as you said, the fed will focus on the underlining numbers that are less volatile. stripping out food and energy and looking at the core rate which we think may be up 0.1% on the rounded basis. a little bit less than others. they also look at a really sub measure services and core services ex-rent. that is expected to be flat. there is a lot of different variations. i think the message will all be the same in the month over month print.

on top of the low reading in may, we are likely to see low readings in june. when you talk about the year over year numbers and the trends, i think the fed will look at the year over year number. again, 3.4% versus a year ago. looking at how much it's changed over the last three and six months. that gives you a sense of the direction of travel to the 3.4% year over year number. you will hear people talking about the fact that the three-month annualized change is down to, perhaps, under 2.5%. the six-month change may dip from 3.7 to 3.5. that's really good news. the three-month and six-month change coming down suggest the 12-month change might come down. that is the trend the fed wants to see to have confidence that we will continue to see inflation, the year over year

trends, move in the right direction and getting back to the ultimate 2% target. >> why are you sticking with a non-consensus view that it won't be until december? >> we are not ruling out september. certainly a lot can happen. we do think the june numbers will be lower. we're not as confident in the july and august numbers as low as they are in june. i think the fed has kind of suggested they want to continue to be patient. the last thing they wanted to do is cut rates and fuel the economy as markets begin to price in even more rate cuts and you end up -- you stole the progress on inflation. we are not ruling out september, but we moved back in terms of our expectations a number of times on the timing of the rate cut because the fed has shown resolve in terms of wanting to be confident. we moved to december and we're sticking with it.

joe, the biggest thing is the inflation is important, but what we hard from chairman powell this week in his testimony was the recognition of employment is actually slowing. a more balanced, i think, thinking around the decision process. as important as the inflation numbers are, if the employment situation continues to cool, that could lead to pulling forward the timing. that would increase their confidence that you have the economic conditions that would facilitate the inflation rate to trend lower. >> you warned us both ways. >> yes. yes. >> it could be they are worried if they did something too quickly, they didn't have inflation all the way where they want it to be, but you are also saying if the labor market were to slow more quickly than we have seen so far, that could make a difference. you highlighted how difficult it

is. >> it is. worried. if the economy slows, then again the worry of the reacceleration if they cut is somewhat mitigated. that is why we have been focused on inflation as kind of defining the timing of the rate cuts. i think the developments or more evidence of the cooling of the labor market will feed into the timing of the decision as well. that is something that has not been the case. we have focused on the cpi numbers. that is starting to balance are out a bit. >> all right. michelle, very good. when they finally do cut, we won't be at exactly -- we will not have gotten to the point of 2%. we will not be there. it is in anticipation of finally getting there. that is not moving the goal post? that is not saying, okay, we're not being true to our mandate? >> no, joe, we do know monetary

policy takes a good time to work. it works with lag. you can't wait until you get to 2% before you start cutting especially when you are potentially as far above the neutral rate as we are now. with the fund rate over 5% and the neutral rate, arguably 3% or the fed thinks less, you have a long way to go to get to neutral. you cannot wait until you get to 2% before you start cutting. >> thanks, michelle. >> thanks, joe. >> see you later. coming up, the irs reached a milestone in the push to collect unpaid taxes from high-income earners. and we are coming back with the delta airlines shares which are up in pre-market. stay with us.

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welcome back. new in the last hour, the u.s. treasury department and irs announcing they collected more than $1 billion in tax debt from high-income individuals in fact 3 the past year. the agency announced scrutiny of those making more than $1 million. the irs commissioner said unpaid taxes collected from similar earners before the funding were negligence before budget constraints. coming up, delta airlines is set to report and the interview with ceo ed bastian. "squawk box" will be right back.

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delta is reporting just now.

the stock, i can see, is under a little pressure. phil lebeau is joining us now with the numbers. >> joe, we'll talk about that in a little bit. in line with expectations $2.36 a share. revenue coming in shy of expectations of $15.41 billion. here is where the pressure is coming from. unit revenue. revenue per available seat mile. guidance for the quarter was to be flat to negative 2%. came in lower by 2.6%. that was a greater decline than the street was expecting. the premium seat revenue, when you look at the other metrics, premium seat revenue up 10% year over year. international revenue up 4%. cost per seat mile was better than expected. up expecting that to be

higher than that. revenue up 16% compared to the second quarter of last year. guidance for the third quarter, this is going to be shy of expectations, another reason there is pressure on shares. delta guiding between $1.70 and $2 a share. the street was expecting them in the third quarter to earn 2.05 a share. the third quarter revenue up 2% to 4%. the expectation was up 5.81%. lighter than expectations. full-year guidance unchanged. the street at 6.57. they are affirming the free cash flow guidance making or bringing in $3 billion to $4 billion a year. lots to discuss with ed bastian, the ceo of delltadelta. we will talk to him at the top of the hour.

revenue coming in low areer tha expectations. the street was at 2.5 05 for th quarter. guys, back to you. >> i understand what you are pointing to, phil, but i don't understand why. every day, we see record travel. people are seeing a glut of seats. >> have you seen the fares, joe? >> the glut of seats. >> lower end of the market is oversaturated. you have little pricing power. that is revenue per available seat mile. you look at the premium segment, which is not oversaturated. look at how well delta is doing. we had guidance from southwest and american and other airlines they are expecting their revenue to be impacted because of how much capacity has been brought

into the system this summer. we talked about this many times. add too much capacity into the system, you will have lower fares and that is reflected in the revenue numbers. >> the headline of delta sagging profits signal trouble for airlines this summer. this is the dow jones. profits fall as they grapple with the glut of high seats. >> we will talk to ed bastian about this. >> they are building the fancy lounges for the people who like the premium seats. it's all luxury. >> their premium revenue is up, premium up 10% year over year. what airline wouldn't want that and meet the demands of the

customers? ed believes that is differentiating delta from other airlines. >> i don't want any privilege of any kind. i learned, phil, i only want to go to a lounge where every single person can fly in that lounge. that's me. that's the kind of guy i am. thank you, phil. we'll talk to ed bastian at the top of the hour with phil. >> you want to sit in the back of the plane. ne no privilege. no. take it back. we'll be right back. >> announcer: currency check is sponsored by interactive brokers. the best informed investors choose interactive brokers.

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bank of america releasing the july consumer check. this is what we need right now. the july consumer checkpoint to figure out what is going on with the ckconsumer. the survey finds overall spending for last month , no, this month. overall household pending for june is down 0.5%. how about the taylor swift ex expect? the 23% increase of spending in cities where her eras tour happened. joining us now is chris from bank of america. >> great to be here. >> the context of the splcpi la today and we heard from pepsi. what is going on with the

consumer? >> as you said, in june, we saw overall cardspending down .5%. that was the first negative print. take a step back. we are going into earnings. if you look at spending overall, it was up. not sounding the alarm bells quite yet. when you look at spending, you continue to see services out performing. >> is this all real or nominal? >> well, we'll see at 8:30. >> yeah. it was up for three months and then down. that's not inflation. >> it is not inflation adjusted. correct. it is not inflation adjusted. i think one of the things that really jumped out to me in the numbers is travel. you guys were just talking about delta. if you look at the travel numbers in terms of the number of people who are traveling, it is booming both domestically and internationally. remember, last year was supposed

to be revenge travel. summer of revenge travel. if you look at the number of bank of america households making transactions abroad. it is up 6% from last year. >> what is amazing is the number of people who have passports. only 12% years ago and now up to 50%. something like that. it's really been a striking change. >> it has. what hasn't really changed is where people are going. based on data, they are going to mexico, canada, uk, france and italy. the olympics are coming up later this month. we expected to see that continu. they are traveling domestically. the number of people making transactions outside of their region, little over 3%. >> it is interesting delta is the flip side to this. too many seats and pressure on fares. >> i think it is consistent with the story.

joe, consist dent that every person is in the lounge with you. >> they are sneezing in the buffet. the sneeze guard. i told kelly. a lounge that will help people like me, i don't want to go into. they need a higher standard than that. you know, no, thank you. >> you will be alone? >> i will get a passport if it only was italy only. if i could get one. >> there are a lot of people -- i don't know. we can talk to policymakers and figure that out for you. going back to the spending on the travel side is actual travel spend was down last month. even though so many more people are going. we will see at 8:30 what the updated cpi numbers are. if you look back in may, airlines were down 9%.

>> year over year? >> yeah. car rentals were down. there is space going on. >> you said deflation. i talk about the potato chips and things like that. there is ecommerce deflation and furniture deflation. you said the "d" word. it doesn't mean that we're undoing the 20% hikes of the past four years. what it means is for companies who are depaeendent on this, it could be a problem. it could mean playoffs. >> the labor market is a topic of discussion. what is this telling us? we are seeing signs of a slowdown, but it is gradual. we are seeing that in a couple of places. you look at wages. bank of america looks at the money after tax money coming into accounts. what we're seeing there is we are seeing wage growth and income growth across lower,

middle and higher income households. lower income households are going up at the highest rate. 3% in june. that is lower than it has been over the past two years. so, lower income households are up 3%. >> exactly. we hear from some of the blowups we had with the consumers are choosey and the macro people saying the excess savings are running out and things like that. does this paint that picture for you? >> i think we're seeing the labor market cooling, but very gradually. another area where i would point that out is we can also understand where people are changing jobs. we had the great resignation where everyone was changing jobs and people were getting pay bumps. when we last looked at this, we had about 3% turnover. 3% of our consumers were changing jobs. the amount of money they were

getting when they changed jobs back in the great resignation was north of 20% and it is less than half of that now. getting a bump of 20% which is not insignificant, but not drive the same consumer behavior as when you were getting more than double that. >> no further questions. >> no further questions, your honor. >> liz, i appreciate it. coming up, cnbc's top state for business will be revealed later this morning. te.tt cohn will join us with the last here is the look and uponder that. "squawk box" will be right back. ) i have inherited the best traditions. (woman 2 vo) i have a great boss... it's me. (man 1 vo) i have people, people i can count on. (man 2 vo) i have time to give (grandma vo) and a million stories to share. (grandpa vo) if that's not rich, i don't know what is. (vo) the key to being rich is knowing what counts.

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welcome back. the wait is almost over. the cnbc top state for business will be revealed in the 8:00 a.m. eastern hour. scott cohn joins us from that state to recap his diabolical hints. scott. >> reporter: that's we will reveal the states that came oh, so close, states 5, 4, 3, 2 and then in the 8 sclks hour we will review the top states for business. we will speak live with the state's governor. all day yesterday, as you eluded to, we were giving out our patented diabolical hints. if you worked with us to get all five of them, i don't know what's wrong with you. we will take pity on you. take a hike. the cure. shell game. a penny saved.

and hubba hubba. in the 8:00 hour we will explain what they are all about. you'll hit yourself in the head and say, oh, of course. >> are you going to give me the states later? scott, i think i might like worst states better than top states. >> yes. that's a good point, kelly. we'll go inside the numbers all day long as we can on cnbc and at topstates.cnbc.com. after we reveal the top state you'll see where your state ranks and do a little poking around yourself and look at how we got there and what all is going on this year. >> i need to know exactly. it's about infrastructure. that was one of your main things this time, scott. initially my first thought is does that really count. in other words, the top state for business that way would be shanghai because you have a government that is subsidizing everything with a buildout

that's not real. it's not organic. then i was thinking, i want to know the five states that if you do this until you're 1,000 we'll never win the top state because i know there are five. i mean, you -- you cannot do enough back flipping, pretzel twisting to get california as the top state for business. you just can't do it, cohn. >> that's where all the best companies have come from. >> i know. >> yeah. >> it's in spite of all the crap that you have silicon valley. it's in spite of being in california. >> well, and don't just single out the state where i live. there are a number of states that -- >> sorry. >> -- do have some issues, but it is kind of interesting this year, particularly i think at some point today we'll tell you about the most improved state, which is going to be -- that's an interesting story. there's a lot of interesting stories in this this year because we're talking about all this infrastructure. that's shaken things up a little

bit. it's just a really, really interesting year. as we've been talking about and kind of teasing at this for the last few weeks, sort of an inflection point. the first few years we were talking about incentives, taxes, things like that, all still important. for several years we were talking about workforce, which also is still very important, and now it's shifted a little bit. this is based on what the states are talking about, how they're selling themselves to business. that has definitely changed in the last year. >> all right. we look forward to it. thanks so much. >> breaking news from pfizer.

>> making a once daily formulation. >> pfizer, the results from that. in the first quarter. >> over 300 billion and it's now 160 billion. down 50%. that's not how you want to run a pharmaceutical company. meanwhile, i'd like to look at a two year or three-year eli lilly

versus -- >> oh, my gosh. >> almost a trillion dollar market cap. >> what do you want? i want them to put all their eggs in a vaccine basket where you know it's going to be over in a year. >> and -- >> they also built -- they also made a lot of that other crappy drug, whatever it was, paxlovid. >> paxlovid? >> yeah. >> doesn't that work? >> i don't know. >> covid's making a little comeback. my dad got it the other day. >> he'll be fine in like three days. >> yeah. >> 300% versus -- all right. great american company, we're pulling for them. they may need more than this. to get things back on track. coming up, a busy end to the week with key inflation tandda a the kickoff of earnings season. we'll get you ready next. backed by over 145 years of risk experience, helps investors meet their goals. pgim investments.

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let's talk markets now. specifically retail trading activity. retail investors. we have j.j.kinehan, i.g. america. all tech. i don't know, we were talking about it earlier, j.j., whether that should give you cause for concern that it's all tech or whether it's -- where also is it going to be? these are the greatest companies. you point out even two of the big gainers in the past couple of months, apple and tesla, there has been some slowing there even in the last couple of days? >> there has been, joe. where people are putting it is kind of back in the big tech. amd has been one of the primary recipients of that as people have really come in to buy that stock in an incredible way. what's interesting, you got done

talking about pfizer and lily. lily is a stock, joe, over the last two weeks we have seen bullish activity overall as people continue -- you know, they just bought morphic which is a company that helps with autoimmune diseases. of the you got done talking about some of the weight loss stuff, et cetera. i find that interesting. a little bit away from the technology sector. the other one is vistra energy. that's a stock where 92% of the energy has actually been bullish activity. it's a stock that's doubled in the last two months. it's really been an incredible story. i know you guys have talked about that over the last few days. you know, a couple of non-tech names and tech, as you've said, seen some sellers of tesla, apple. amd being the primary recipient, but the other names everybody follows that have been big recipients have been amazon and microsoft in terms of where people are buying overall as this incredible rally continues.

but what i do find interesting that we've started to see more in the last few weeks than i think we saw throughout this rally is people taking profits, even a stock like costco over the last few days and, again, they had another leg up with that news yesterday. people are actually selling the stock, taking profits and looking for other places to go with the money. so we'll -- and not necessarily redeploying the full amount of money also. so i think that's also going to be interesting. can we continue the rally if that continues. >> we've gone this far, last year was great, too. people still say it was a lot of cash on the sidelines. is that -- does that explain this just every day it's almost like, you know, you wake up and the futures are up. almost every day there's no volatility. there's no -- not only no 10% correction, there's no 3% corrections it doesn't seem like. what about sentiment? are people bored?

scared? complacent? what are they? >> i think maybe a little bit complacent. it's interesting you bring up volatility. obviously as we look at the vix, it's just under 13. what's interesting if you look at retail but activity overall, there doesn't seem to be this need or desire to really protect much of the down side. let's face it, if you had been protecting the down side, it's been costing you money month after month or whatever your timing is in terms of buying any puts, et cetera, against your position. so we'll see if there's any scare at all. i think its 's a bit of a head scratcher. fir if i were to tell you all of the ma ninipulation manipulations, i don't think either one of us would have said, yeah, sure, volatility will be completely low and we'll have sent our 37th new high on the s&p 500 yesterday. it really is absolutely mind boggling.

it doesn't even seem to be that we are slowing down. the path of least resistance continues to be to the up side. as you said, people still aren't true believers that we have to continue higher. >> is it all -- can you make a case, a bullish case for why the market keeps going up other than there's a lot of liquidity still around and the fed bringing some liquidity? the fed's raised interest rates. the stimulus from the pandemic, all the fiscal spending, maybe that's still happening because some of those programs are multi-year programs. maybe there's some of that. the but you wouldn't necessarily say earnings have not justified the move in the markets. the earnings have kind of come through for the best -- for the stocks that have done the best, the earnings have been there underlying the moves in the stocks. >> yeah. they've not only beaten earnings, joe, they've kind of blown them away. if you look at stocks like

nvidia, et cetera, what they've done versus earnings. you are making the case in the big stocks doing so. again, if you look around, you know, where else would people sort of go with their money right now i think is the other question right now. the constant, you know, back and forth in terms of will we cut rates, will we won't? how many months have you been talking, think about going into december of last year. how many cuts everybody expected. i think it made people a little bit leery, if you will, of the fixed income market overall. we're still having that same conversation as we see september with about just over 75% probability of a rate cut. so, again, i think part of it is people are like, okay, stocks are still the best game in town. it's proved to be absolutely true, but to the point you made earlier, are people necessarily piling in the stocks and feeling like i have to buy more, i have to buy more? the answer to that is no. that's actually very healthy for the market and it is why the

market can continue to go higher. the amount of competition out there for the money is continuing to dwindle. again, when people talk about there's only 7 or 10 stocks really driving this, i think if you look it kind of makes sense just like everything else in life. the competition sort of says, this is where i want to be. >> all right. >> jj: thanks. i say it every time you're on. i still see the tasty cake logo. >> next time i'm there i'm bringing you tasty zblaks bring me some butter cream crimpets. >> consider it done. >> crumpets. >> good to see you, joe. >> i think it's something else. thank you, jj. the 7 a.m. on the east coast. you're watching "squawk box." i'm joe kernen along with kelly evans. yeah, unbelievable. 2:00 your show's on. >> 1. >> 1:00. it's over at 2. that's what i meant. >> yeah. yeah. ment. >> today's top stories, wall street is set for a lower open.

>> you've hosted these shows. >> i know. i have. the i'm having a bad night. have a key report on inflation. i've admitted, i'm having a bad night. rising and we'll bring you the numbers and instant market reaction at 8:30 a.m. eastern. the ftc planning to sue unitedhealth, cvs and over alleged practices forprices on drugs like insulin. they'll argue their tactics contributed to inflated drug prices. which we've always thought. middlemen. in a statement to cnbc, cvs and express scripts stand behind their work. no comment from optum and the

ftc. costco raising their membership fee. the basic membership go up by $5 to $65 a year while the executive membership will rise by $10 to $130 a year. >> we just snuck in our renew, executive level, don't want to brag. >> got in at 120. >> every now and then i make a good trade. >> well, you've got that great 4% yield on your two-year. >> were you able to order appetizers? >> i said we're going to ride it out in treasuries, buy the market 30% lower. i think we're up 40% since then. >> i begged you as a young person to buy bitcoin. >> i know. why are the millennials more conservative than the boomers? >> i don't know. you have a night light in your room. >> it did not work out well. speaking of which, let's check the futures. dow is poking ahead. the first time it traded above this level was back in may. haven't closed above that yet

though. we're seeing some slight negatives across the board. the s&p implied lower. frank holland has more with this morning's pre-market movers. hey, frank. >> good morning. pepsi, shares are down more than 2%. that was after a revenue miss. pepsi also lowered the four-year guidance. the guidance previously was at least 4% growth now saying approximately 4% growth. clearly words matter. pepsi saw weakness in two u.s. businesses. frito lay with a decline. more than 2%. another earnings mover. delta airlines moving lower after eps and record level q2. that still missed estimates. take a look. you see shares are down almost 10%. delta maintained the 4 year earnings guidance of 6 to $7 a share. putting pressure on the stock according to phil lebeau. two bright spots in this report.

premium seat revenue up 10%. international revenue up 4%. delta did say it would take a $100 million hit on trans atlantic hits on flights to paris for the olympics. delta ceo ed bastian will talk a lot about the quarter and what he's seeing when it comes to the demand for the premium seats. this morning watching apple shares taking a look down fractionally. eu regulators said they have opened the tag and go payment system to competing companies. this will settle a four-year long investigation. the rare decision for apple to settle with regulators. they've pushed back. apple faces three investigations under the eu digital markets act. kelly, back over to you. >> frank, we appreciate it. the frank holland. growing calls from celebrities and politicians for president biden to pull out of the 2024 race for the white house. talk about that. >> celebrities. that's important.

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delta airlines reporting a short time ago. phil lebeau joins us with a special guest. hey, phil. >> hey, joe. ed bastian, ceo of delta. the we're going to talk about the reason the stocks are under be pressure, the unit revenue. before we get to that, you're coming off record revenue for the second quarter. this is one of those cases where you've put up good numbers. the question is the street was expecting a little bit more. the. >> absolutely. we'll talk about the demand outlook. second quarter was great. our team did an amazing job. kudos to them. starts with the operations. stellar performance across the board. best reliability in the industry

month in and month out as we're doing all year long. best in our history in terms of operations. demand was healthy. when you couple great operations with strong demand, we hit our aps that we guided to right on the number. the consensus was i think right with where our number is. free cash flow in the first six months of the year, close to $3 billion. guided full year, close to 3. we've had a really great summer that we're looking towards, yet at the same time we've got to talk about what's going to happen with respect to the industry. >> let's talk about that. unit revenue or revenue per seat mile. you were getting guidance of flat to negative 2%. you came in negative 2.6%. your guide in terms of eps for third quarter is shy. are we seeing cracks in the consumer right now or is this an oversupply situation in the industry? >> i think it's more oversupply as opposed to cracks.

let me provide context. the quarter we've finished, second quarter, second highest quarterly performance total in our history. only one that was high was second quarter a year ago. that was the first time that everyone could travel almost anywhere in the world and had -- and prices were sky high. it didn't matter where you were going, particularly internationally. question a year ago i was getting all the time is when are the sky high fares going to come down. my response was when we can bring more capacity to bear. the industry bought more capacity for this summer. capacity up 8% for the summer, talking particularly in the domestic marketplace. real demand in the summer anyway. i'm saying summer between june and august is probably closer to 4% in terms of real organic demand growth. you have an oversupply. that oversupply is limited on the lower ends. you see the discounters particularly discounting heavily and as a result of that you've

got some fair end yield weakness in the quarter. the good news in all of that are two things for delta specifically. one, we're pretty well insulated from that. yes, we got hit probably by a point or two in terms of our outlook in terms of where people thought we would be versus where we're going to be on revenue. i understand that. we're premium. we've got international. we've got business. much stronger product mix. american express loyalty stream. impact on delta is fairly limited. secondly, the industry's already correcting for the oversupply so that by the end of august that 8% is already back down to 4% more in line and in balance with the consumer demand and as a result of that we expect in september our domestic unit revenues will be back reflecting positive once again. >> you're confident the industry can correct on the overcapacity because let's be honest, this is arou an industry that has a poor

track record of showing discipline when it needs to show discipline. >> candidly, the market is moving. these are the numbers in the tapes. not an anticipation. this is actually what's going to fly coming in the next few months and for the fall quarter ahead. you do not have to guess. you can go see what it is. i've never seen the industry move as rapidly to adjust it. the reason for that is you do have in the lower end category in our industry, you have a lot of challenges in the lower fare categories. summer is when people travel. all the discounters put as much capacity and supply into the market when people want to travel, i get that. in the fall when that demand comes way down, the industry really is acting responsibly. >> ed, i know joe has a question for you. go ahead. >> it's kind of a cultural question, ed. good to see you. we always appreciate when you come on. i'm just wondering in the world the way it is today, ed, does it ever give you pause to try to cater to the really well healed?

you have to because that's where the growth is, that's where -- you know, that's where a lot of the profitability is. i'm thinking about these incredible lounges you're building that are very exclusive or, you know, refurbishing the planes to have all of the -- in the front of the plane where you have those pods where some people in their entire life will never fly in one of those, ed. i understand luxury lod gers can get away with that, but as an egalitarian service provider for everyone to travel, do you have to tread kind of lightly when you're -- it almost seems like you're catering to, you know, the income -- the people that are doing better. >> well, a couple things, joe. as compared to being the airline for the affluent, which i understand people want to have some luxury experience. they're focusing on investing in their own experience delta wants to be there for but we're also

the largest airline in the world when it comes to overall revenues so clearly we're catering to everybody. we have products in all categories. the growth that we've seen post covid is clearly though in that higher end segment, and that's where delta specializes, whether it's business travel, whether it's international, whether it's the american express relationship we have. as a result of that, that's giving us the revenue back that we can invest in these lounges, that we can invest in free wi-fi, we can invest in the experiences that customers really want. >> all right. >> reporter: ed, i have a question for you regarding the consumer. we have record demand right now. on the leisure travel side separate from corporate, are people taking more trips or are they saying i'm taking about the same number of trips as i've taken in the past but i'm spending a little bit more? i'm upgrading it by caanes? are you noticing a difference? >> oh, yeah. the experience economy, which is

what our industry serves, is doing well. we've talked for several years how the services economy was once again going to eclipse the goods and retail sector and we're back and actually continuing to grow at a pretty healthy clip. i don't see that changing. again, you look at the summer. you look at what's the big news where people want to go? especially our younger demographic. they want to go to europe to see taylor swift. well, that's what's -- that's what's selling. you want to see friends and family that you haven't seen in a few years, that's where people are going. baby boomers are taking cruises anywhereby around the world. that luxury element is the experience but it's the experience broadly where people are going. we've been on this for 15 years to differentiate in an industry that forever was a commodity business, no longer with delta. >> reporter: ed, thank you very much. speaking of experiences, the man is going over to paris for the olympics. send it over to you. >> thank you both. we appreciate it.

delta shares under some pressure. coming up, tesla stock has been charged up over the past ten or so trading sessions. before the big reveal of the top states for business, we'll have a preview of the runners up. "squawk box" will be right back. >> announcer: time now for today's aflac trivia question. introduced in 1967, the radarange was introduced to u.s. households. what is the radarange better known as today? the answer when "squawk box" returns. good thing i had aflac. (aflac duck) hmmm the cash i got from aflac helped pay for medical expenses, groceries, rent. it really helped close that gap. (whisper) go, go, go! (group) yay! go aflac! go duck! get help with expenses health insurance doesn't cover. find an agent. get a quote at aflac.com. wish we had aflac on our team. you can! (♪♪) (♪♪)

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>> announcer: and now the answer to today's aflacter trivia question. what is the radarange better known as today? the answer, the microwave oven. tesla shares had a rocky start in 2024 down more than 20% at one point, but they're now in positive territory, up 5% year to date. let's talk about why doug clinton with deep water asset management, managing partner, he's joining us now, doug, why the turn around? welcome. >> thanks, kelly, for having me. the turn around is the narrative

shift from the bears saying, look, the ev conversation was too overheated. we had too high expectations. it seems we've hit the trough of that disillusionment the. tesla is returning to growth. easier comps. the street has them growing near 20% for the next two years. that's piece number one. piece number two is we have a catalyst on august 8th, the new robo taxi event and tesla has always traded well and been pushed by new product announcements where at this event we'll see what they're doing with robo taxis and we could potentially get three new car announcements. i think the bulls have firm control of tesla now because of what's coming in the future. >> three new car announcements. we're waiting on the model 2, cyber truck is kind of off to its start. what is the valuation right now? i was reading, is it north of 90

times forward earnings right now? >> if you believe in the street numbers, it's roughly in that range, and i think to your point about valuation, that's really probably the question you need to ask going forward. so if you are trying to play this for the next month, you're looking at just this august event, it's hard to see why the narrative would shift between now and then. after we see what tesla comes out, then i think you have to ask that fundamental question. the i'll use nvidia as an analogy. we've seen nvidia stock go up over 200% in the last year. their business has grown 200% on the heels of very rapid ai demand for their products. i think the question we'll have to ask ourselves after the august 8th event is is there a new product here, whether it's robo taxi, potentially new vehicles that helps us rerate by 50% or more thinking about the stock going forward because, to your point, the valuation, if nothing changes, does feel rich. >> no, i think you have to credit them for all that they're doing on the ai full

self-driving robo taxi front. if it weren't for that, the stock would be doing more poorly. there's an element of truth. no, it's just a car company and those who say, no, it has transformative capabilities. there's people now letting their teslas drive them around to a large extent. that's something that no other car maker is making possible. can they kind of keep that edge though, especially what's going on with a lot of the chinese manufacturers? >> i think they can keep the edge. to your point about fsd, they have hundreds of thousands of users using their full self-driving technology and no other car manufacturer in the world can really say they have that much real world data and data ultimately is what drives intelligence and ai. they do have that advantage. i think that will be hard to overcome. you look at some of the traditional automakers. i absolutely think the traditional automakers will have plays with evs and autonomy. they've had struggles, too.

they are not focused on it like tesla does. the traditional automakers have to balance legacy and ev. >> it's not coming from the legacy players. it's going to come from china, isn't it? >> china is probably the best bet. they have a lot of resources they're pushing towards this. the byd has good products but, again, when you think about innovation, you think of who is really at the forefront of driving the ev revolution forward. it's still tesla and i don't think that will change. >> doug, appreciate your time this morning. thanks. coming up, scott cohn joins us from the top states for business with a look at the runner's up before our big reveal later in the show. here are the futures right now. we are uncharacteristically t o ng some red in the morning. notomuch though. "squawk box" will be right back.

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welcome back. we are getting set to reveal america's top state for business right here on "squawk box" momentarily. first, let's run through the states that came oh, so very

close. scott cohn is going to break a lot of hearts right now. he's back in this year's mystery top state with the runners up, scott. >> reporter: very, very close as you will see, kelly. a reminder, again, of how we do this. ment ten categories of competitiveness. 128 metrics. 2500 possible points. for 2024 let the countdown begin. >> reporter: state number 5, florida, the sunshine state cracks our top five for the first time with america's top economy for the second year in a row and the second best workforce, but there are storm clouds, literally, with 97% of properties at risk of a climate disaster and america's least reliable power grid, florida ranks 35th for infrastructure. the resulting insurance crisis contributes to america's ninth highest cost of living. number four, georgia, the peach state. in a year wherein from structure is king, georgia's can't be

beat. the world's busiest airport and a wealth of sites to develop. georgia has 40th for quality of life. state number 3, texas, the lone star state. after a rare absence from the top five last year, texas surges back with america's top workforce and tieing with new york for tops in technology and innovation. but with one of america's worst health care systems and the strictest abortion ban, texas finishes dead last for quality of life. our 2024 top state's runner up, north carolina, the tar heels state. our two-time defending top state can't quite pull off the three pete. second best for business friendliness and third best for workforce as people keep moving there. ment that means growing pains drop the state to 20th place for infrastructure. >> reporter: and in a year this competitive, you cannot afford to drop to 20th place for

infrastructure. how competitive is it? it is the most -- the tightest finish in the 17 studies that we have done. north carolina misses the three pete by 3 points, 3 points out of 2500 possible. yes, we checked the math again and again and again. that makes what this state has accomplished where i am all the more impressive and we will reveal america's top state for business next hour on "squawk box." we will talk with this state's governor and you'll be able to see where your state ranks, if you didn't see it already, at topstates.cnbc dls.com. guys. >> if it was virginia you would get to talk to glenn youngkin. it looks like the shenandoah valley. >> i'm not an expert. i don't know if i'm seeing it. >> i don't know infrastructure if that's the key. >> virginia was not in the top five if it's not number one. that's weird.

isn't it? and they got, you know -- if you like infrastructure and you're next to d.c., i mean, it's just -- you know, the trucks with the cash don't have to drive as far, do they, scott? >> well, that's an interesting theory, joe. that's an interesting theory. we'll see. the wait will be over soon. >> listen -- >> where is robert smith from? lead singer of the cue? he's from england. it's not england, is it? >> no. >> marshmallows. what the hell were those marshmallows. what was that? i never know what's going on with you, cohn. yesterday he was grilling marshmallows. >> it's mutual, joe. i never know what's going on with you either. >> i'm pretty obvious. >> reporter: fair point. >> yeah, beings exactly. all right. thanks, scott. when is this? 8 something? >> yeah.

next hour. >> 8:10. the. >> right. thanks, scott. the pressure mounting on president biden and the impact it could have on your investments depending on how everything finally plays out. later pennsylvania senator john fetterman, look forward to this, joins us. wow, we've got a picture of him in a suit. i don't know when that happened. like i said -- >> is it required now? >> i don't know. you're starting to like him. >> he has stood up for his party. >> i agree. ♪ ♪

♪ ♪

as washington remains focused on what's next for president biden, our next guest says that financials would be one of the clearest sector winners if former president trump were to win. joining us now. >> wow, if president biden continues to be the nominee, you

feel more comfortable recommending financial stocks which would benefit from trump then we'll go into the reasons why. even if he is replaced by vice president harris, you still think trump has an edge but on the one hand 7 70% probability. vice president harris, 55%. the same trade just less. >> starting with biden. i think you have to look at trump as a quite clear favorite over biden. the polling has deteriorated significantly. voters have a lot of concerns. >> she's got more up side certainly. it's easy to imagine her mounting a vigorous campaign.

she's pulling a little ahead. i think it makes sense for a slight edge. yeah, looking forward. financials are one of the clearest winners along with traditional energy, crypto stands to benefit from a trump win. i think from a financials perspective there's a mix of regulatory tailwinds, antitrust will be a big benefit. it's one of the sectors that outperforms so there's some market muscle memory there. even as people get more and more confident be that trump is a clear favorite, we're not seeing enough for people to go ahead and put most trades are. certainly in my conversations with investors across the street, people are in scenario mode rather than reacting to the ups and downs. >> that's it in a nutshell. all you have to do is watch the

betting sites for who the democratic nominee is going to be. i've seen it move 20 points in an instant based o on a letter that president biden writes or morning joe call in or whatever. i don't know how you make concrete decisions in the stock market about it. some of the other interesting things, tobin. the move higher based on the inflationary implications on 10% tariffs, trump tariffs, whatever you want to call it, that's actually kind of dissipated and gone away although you still think if it was trump that you would see higher 10-year yields but a flatter yield curve. >> yeah, that's right. when people were trying to point to how are markets reacting to the debate, seismic shift we saw, one of the things we saw commentary pointing to is 15, 20% backup which did react or there was a move, i suppose, but

that move -- the 10-year has been on a roller coaster. when it's up, people talk about deficits. there is a lot of narrow and following price. yeah, i mean, looking ahead the consensus in markets is for a higher 10-year. that we hear from pretty much everyone we talk to. the debate is more the short end of the yield curve. a lot of people are expecting steepening. our view is given the uncertainty, the fact that the fed won't want to hike or cut into it, that probably slows fed cuts in '25 and '26 which puts upper pressure and a flatter curve, overall. >> we had someone on yesterday, i have senior moments i guess,

too. they actually made the point that, yeah, for one day in the year i would find myself voting for trump just because i think it will be better for business overall. they're more or less saying that, you know, the prerequisite, yeah, i don't like anything about this guy but for business you hear that a lot from -- in certain circles, and more this time around i think where you almost have some people conceding that maybe as a business person some of the regulatory issues, taxes, energy, they almost find themselves they have to come down and they are not quite as embarrassed about it this year, tobin. overall do you see corporate leaders might be -- usually they're quiet but maybe they'd be out in the open by saying i think the trump policies will be better overall? >> yeah. it certainly depends what you're

focused on. there are certain areas where he has a quote, unquote, pro business agenda. to the extent those are your priorities, i think there is a big difference between the parties. i think there's been less reticence from investors in particular to come out and say that they're thinking about supporting trump. interestingly, there has not been that much dynamic a among corporate leaders. no fortune 500 ceos have come out supporting him. >> i don't know. that report, i don't -- i don't know how many fortune 500 ceos were actually polled for that report and how many of them are willing to say they're giving to biden? same amount, zero. >> it's not that -- >> they have customers. they have customers on both sides of the aisle. >> exactly. that's what i mean. >> you'd have to be crazy to say anything. >> right. that's what i mean. i think there is still more political sensitivity to taking any side from folks who have customers, employees, stakeholders they need to manage as opposed to financial industry

titans who are independently operating. >> someone, a ceo, a big one told me it's like a wildebeast and the lions come around. the minute you leave the pack and you are out in the open, you're toast. you're dead. why go out and say something when you have all of those customers, employees, everybody else. you'd have to be insane. >> right. >> tobin marcus, thanks. good to have you on. >> up next, iac's ceo joey levin joins us. that interview is right after the break.

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here early in sun valley. before we get to your iac business, i have to ask you about a company that you recently looked at. as far as i understand you signed some ndas. paramount global. my question for you is this. the there's a 45 day go shop period that just began. are you interested in this company? are you >> we look at a lot of things and there's certainly some history with the company, and our chairman, and maybe there's an opportunity. maybe not. we'll see. but we're an opportunistic company and look at things when we think there may be something to do. >> so if there's still a chance you might make a bid for paramount global, which barry diller asserted maybe it's still a possibility, just yesterday. my question is -- what does that say about what you're interested in right now? i ac does not have traditional media outlets, meredith, a publishing business. where does this fit in or what does it mean for your vision of

the company? >> i don't think that any particular company defines iac or has historically. we have companies in a wide range of things. you mentioned meredith, biggest digital publisher and fantastic business but that ranges from a large interest in car shares mgm globally and angie, home services. there's not ap consistent pattern among any of those than we think category leaders with long-term potential to grow and generate long-term cash flow. >> now, some big news out of i ac recently at dot dash meredith struck a deal with openai and chatgpt to licence that content. how is that going so far and do you fear it could be can cannibalistic to your business? >> yeah. at first collecting interest on

a.i. very nice in the deal we're doing with openai. it's certainly something we think about. the market thinks about it a lot. if we look what's happening in google so far we're holding our traffic and doing well, and i think that openai is likely to be, or chatgpt, rather, likely in that positive for traffic. if i had to bat i'd say it will increase audience to our profits overtime, not take it away. >> now, a question is as you look across your companying, though, how do you think a.i. will impact benefit among the various businesses you mentioned from mgm in the gaming business to angie's list? >> one fantastic thing is it helps organize data and make it more searchable. there's so many examples of that where companies are using that already. we have a small company called vivian, matching nurses with jobs.

you can know search on the basis of, i want a job in the mountains organization i want a job near a beach. we couldn't come up with those searches on our own. we could say, drop down menu by state or city. now openai finds those patterns in things. you can expand concepts like that across all i ac businesses. the other one very tangible is customer service. a lot of companies are existing offering a.i. technology to us to deliver customer service for our employees in a way that is better than human customer service. they know policies better. they can enforce policies better. sometimes are more empathetic, actually. so chat via customer service seems to be another use cases but the use cases will get bet around keep evolving. >> in the past you mentioned duopoly google and meta. are you concerned power in a.i. ecosystem is too concentrated? >> definitely.

data is a huge, an essential asset for a.i., and these companies have a enormous data advantage relative to everyone else. now, i do think that many companies existing incumbents, will benefit from this technology, because the technology keeps getting better, faster, cheaper, and it's licensed out to any company in ways that is actually very quickly accessible, usable. so that companies like ours can use it, but i don't think that the small companies with small capital can compete on bidding their fundamental models. >> and a final question on the presidential election, because politics really seems to be dominating the conversation here. what do you think would be the best outcome in terms of this presidential election, best outcome for your business and for the economy in general? >> i think that's a -- unfortunately -- more

complicated answer. it's crazy. it's a sad state that this country is in. we're the greatest country in the world, have the greatest democracy in history and our choices are horrible right now. and so what i'm hoping for and what i do think would be best would be a new candidate, and i think it would be incredibly exciting for the economy, for the country, for companies. it would be inspiring for people to have a new vigorous candidate who the world could get behind. that's a sentiment we've been hearing from others here. joey, thank you so much for sharing your perspective and joining us here early this morning in sun valley. back to you guys in the studio. >> yeah. a new democratic candidate. yeah. i get it. it was yesterday, actually, julia, when you were, the person i was trying to remember, you got a different answer. you looked a little shocked. it was anthony noto who said trump yesterday. and hopefully no one else -- >> not shocked at all. that was something we've heard

from a number of -- >> oh. i just thought you said you heard what this guy said to, was the more common thing, which is more -- >> both things. >> oh, okay. >> i would say a ub in of people have said that they believe that a republican administration, i would say noto did not say trump's name. he is said the republican administration would be better. >> it's like voldemort. i understand. >> you want to the know when you're vying to a new potential candidate? you wouldn't consider a new potential candidate out there jrchlt i. >> i'm not saying it's me. people that support trump don't need a new candidate. neem your position think that. i know. some people are avidly pro-trump. they don't want a new candidate. people looking at joe biden at 87 years old might want a new candidate. who would you want on the trump side, joey? on the republican side?

who would get your interest there? give me a name. >> i -- there's a whole wide range of people. >> really? >> almost anybody else, i guess i'd say. >> barry wouldn't like that. >> joe, i have to point out there is some democratic governors here getting a lot of attention, including wes moore and gretchen whitmer and drawing a lot of attention from people who would like to see an alternative to joe biden. >> tried passing over kamala. see how that goes. all right. coming up, amazon reaching its climate pledge, but some say the company is overstating its green credentials. jon fortt joins us to discuss next. later, this will be fun. senator john fetterman will joins us. we'll be right back. whoo! ♪♪ these guys are intense. we got nothing to worry about. with e*trade from morgan stanley, we're ready for whatever gets served up. dude, you gotta work on your trash talk. i'd rather work on saving for retirement.

or college, since you like to get schooled. that's a pretty good burn, right? got him. good game. thanks for coming to our clinic, first one's free.

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♪ you don't...you don't have to worry... ♪ ♪ be by your side... i'll be there... ♪ ♪ with my arms wrapped around... ♪ amazon just this week announced it reached a major goal. canceling out part of its climate impact funding as much renewable energy as it uses electricity in its operations's critics say amazon is overstating its green credentials in this announcement. who's right? jon fortt is here to weigh in. >> kelly, amazon's overstating how big a deal this is. it's good, but how good? first of all look at history.

five years ago amazon set a goal to cancel out carbon impact investing in renewable information. the company reached that goal ahead of schedule more than 500 solar and wind projects globally making manyson the top corporate buyer of renewable energy according to bloomberg new energy finance. great. now, that doesn't mean amazon is literally using renewable sources for all its electricity needs. this is more of the swearing jar methods of climbed righteousness instead of putting a quarter in the jar for saying a bad word, amazon funds a wind farm somewhere when it has to build a powerered by fuels. not a new college fund. same artificial intelligence revolution that has stock investors excited promises to consume far more electricity much of it from coal or natural gas than amazon anticipated in 2019 when it made this pledge. that means amazon stuffing large bills in the swearing jar, not

just quarters, kelly . >> wow. fault for needing all of this energy and innovating, supporting a.i. in a digital economy? >> well, kelly, on the other hand, amazon meeting this goal is a huge milestone not overstated at all. a lot of climate purists would like to see us stop new fossil buell based projects needily. we live in a economy that's not realistic. emerging markets see how the west built a juggernaut and capping new fossil fuel emissions now is like us trying to cut the rope while they're climbing up. practical thing what amazon is doing. giving economic incentive to fund renewable energy bringing capitalism to bringing efficiency to markets around the world. it's too expensive to satisfy the growing needs of the world. a compromise, environmentalism

and compromise saves the day. few enties are as well positioned adamson. a company whose carbon munitions are on par with ma raorocco to a positive difference. >> and impact all of these companies. like at tara power, nuclear-type out in the midwest somewhere. if we do get these companies, think of elon musk everything he's done in his career. get some brains and fire power to do something on the nuclear front, for instance it could make that a much more-ish did. >> nuclear as well. yes. >> intimatens problem. >> aws and next a big cold fusion reactor bezos will come up with. pretty good. your -- carbon offset, bill gates drives me nuts. a jet the size of a 747, but thinks that, he throws a couple million into carbon offsets and feels morally virtuous because

of that. what you didsay, really cool. third world. yeah. we got pretty nice standards of linking over here. you can't have that. enjoy your soy-based meat products. never be able to cut -- not fair. not how it works. >> it's more complicated. "on the other hand." >> why we have the news 3 letter and a qr code on the screen. scan with your phone camera takes you to -- there it is. type if you like to move your fingers. cnbc.com/otoh the full text of both arguments to share. >> i like the keyboard. jon, thank you. earnings tomorrow from big banks. kicking things off. talk to an equity enlist about this from morgan stanley. betsy, please, for all -- heads spinning. a lot going on, little cycle, everything else. what is the maim tn thing to fo in as bank results come in?

>> thanks so much for having me. yes, tomorrow at this time we will be deep into second quarter earnings results for the banks with citi in addition to several others reporting to our wells fargo bk, and so it will be an interesting day. what to focus on. i would say, number one, yes, the results. we are a little bit below consensus, mainly due to a conservative bias we have in our credit loss estimate. >> hmm. >> in other words -- in other words if you're worried, the banks are worried about a slowing economy they put aside more on yreserves and could undermine results right now? >> well, coming below consensus. >> hmm. >> frankly i will tell you over the past several quarters, even years, my conservative credit

losses have been too conservative. in other words, the banks have been on it -- they've been reserving maybe a little less than in my numbers. that will be the first thing to look at, but then from there, capital markets. our expectations is that capital markets will be strong this quarter on a year on year basis. we have m & a, equity capital markets, debt capital markets together. up for the major banks that we covered. 30% year on year. >> wow. >> so those will be strong. and importantly, our expectation here is that we will have that continuing into the back half of '24 and into '25, if rates stay flat. if rates come down a little bit, as our economist is expecting starting in september, that will be an incremental benefit to

capital markets indices. one of the key reason why we're overrating large cap banks. fees low relative to gdp levels and our expectation is that as this unfolds over the next six, eight quarters, we will see acceleration in that capital market revenue. >> interesting. i think some would like to see higher quality beats, too, also reserving in case things go sour. betsy, thank for joining us for a little preview. appreciate it. betsy graceic. coming up, the wait is over. scott cohn is live in america's top state for business 2024. he's going to reveal it after a break. how about a couple of final hints, scott cohn? >> no, no, no, no, no, no. you can ski ee i put on my tie. getting serious, that means. finally, revealing top state for business and talk with this

state's governor. a lot more to come when "squawk box" continues.

we've heard all the hints. finally time to reveal america's top state for business in 2024. scott cohn join us once again. i guess i won't steal your thunder. i don't want to sound like a fan boy but hoping you'd have this governor! scott, that was funny that i said that. wasn't it? i actually said, if it's that state you would have him and maybe -- you go ahead. >> wait. you figured it out? well, we'll let everybody, let everybody get this in just a moment. so we, as we said, we put the states really through their paces more metrics than ever

this year. 128 in categories of competitiveness to tell you which state is tops we turned to one of this state's favorite sons. >> good day. i'm thomas jefferson third president of the united states standing in williamsburg. the 18th century capital of virginia. where the promises are freedom and independence were shaped. come to think of it, those are rather grand ideals upon which to found a nation. or business. or state. come to think of it, it's the top state. >> yes it is. we are in virginia beach, virginia, where the weather is going to be a little iffy today but we're not taking anything away from america's top state for business for the sixth time. it is our most decorated state, virginia, america's top state for business in 2024. its first win since 2021. a look how virginia made it back to the top.

>> from coast to coast to coast, ow search for the state that puts it all together for business carries us back here, virginia. the old dominion with 1,595 our 2,500 points. america's top education system. a signature issue for governor glenn youngkin. >> real estated expectations of excellence. >> school spending lags but classes small, test scores strong and higher ed is first rate. america's third best infrastructure. 121 million people within a day's drive. the power grid has issues, but virginia is a leader in shovel-ready sites like this one near richmond. >> virginia works really hard to listen to companies and companies are telling us that they need these ready sites. >> virginia finishes in the top five for business friendliness, but not friendly enough to land a youngkin pet project. luring the washington wizards in

capitols across the potomac. >> it's easier and better to do business in washington, d.c. than it is to do in virginia. >> virginia has america's ninth best workforce overall, but a problem there, too. too many workers moving out. not enough moving in. virginia has a population migration problem. >> the data is irrefutable. >> even so virginia pulls off a rare top-state feat. finishing in the top half of all ten of our categories of competitiveness. we've said it five times before and we'll say it again -- virginia is for lovers. lovers of business. america's top state for business 2024. >> congratulations to virginia. our top state for 2024. here's where we were yesterday. york river state park outside of williamsburg. beautiful place. wish we could have shown you more yesterday. about 40 miles of trails you you saw. also kayaking. it's an estuary environment.

i learned a new word. it's freshwater and saltwater combined but a really nice place and we thank all the people there for their hospitality yesterday. about the hints. okay. take a hike. longest section of the appalachian trail, 550 miles, is here in virginia. actually longest by far. the cure, virginia ham. didn't get that. cured with apple and hicktry smoke aged for a year. shell game. go a number of ways. largest collection of faberge eggs at the virginia museum fine arts of richmond and oyster festival held. penny saved, maggie walker penny savings bank in 1903, america's first richmond owned bank. hubba hubba, internet hub. 70% of world's traffic goes through virginia but governor reminds me this is virginia's for lovers. works that way, too. speaking of the governor, glenn

youngkin, 74th governor of the commonwealth of virginia. sgr congratulations. six times most decorated state. democratic and republican administrations have won this. something about virginia makes it so competitive year after year? >> first, welcome to virginia and an honor to have cnbc recognizing virginia as the top state for business. we work were incredibly well together. economic developments is a team sport, and our administration has taken huge strides over the last two and a half years to address real areas of importance. talent is always top of the list and ours rated top in america. infrastructure a top immeneed f businesses and allocated $550 million over the last three years making sure we have shovel-ready sites. power. of course. making big strides yesterday.

we announce add big step for potential citing of a small reactor in virginia to be the first. a lot going on. rime so proud of the work our general assembly has done in partnership with us, all local economic development partners and all the businesses, of course, in virginia. translates into success. $74 billion of capital committed to virginia the last two and a half years. 240,000 more people working in the last two and a half years. success approve of the work and an honor to be here with you. >> let me ask you about talking about the general assembly and you have divided government here. one of the thing, give you a chance to respond i know you have before to ted leonsis, easier here than in virginia and kept capitals and wizards in d.c. we don't rank d.c., it's not a state. if we did, would it be easier to do business in d.c.? >> let me begin with, a real disappointment that the capitals

and wizards ended up not coming to virginia. reality is that stadium deals are hard. and i think we put together possibly the best stadium deal ever, and yet we still weren't able to get it done through the general assembly. those things happen. listen, we don't win them all, but, boy, we win a lot. i do think that virginia is an extraordinary place to do business. we have businesses moving here from all over the country and all over the world, and i think that's one of the big hallmarks. that we, in fact, see businesses build a future here that come from everywhere. they come here because of all of the reasons we've talked about. talents and infrastructure and business-ready sites and the best education in america and also the big strides we've made to streamline regulations. to get an air/water permit in virginia today takes one-third of the time it did two and a half years ago. then, of course, we are a right-to-work state, which is so important. that's why businesses keep choosing virginia and i think why we're going to continue to

win. >> the last time virginia won in 2021, you were a candidate. you weren't as impressed back then. you said, your campaign said virginia might be the number one state for political correctness but not in the things that matter forebusiness. we went through the data. a lot of things haven't changed. things wanted to get through a 15-week abortion ban things like that didn't get through. voting rights stayed roughly the same. not to relitigate that but is this working? i'm curious. keeping each other's excesses at bay. you kpralcompromised on educati. not a popular word in politics nowadays. is that way to look at this? keeping each other at bay or more things want to do that you can't? >> i'll begin with the fact i think results matter. and when i came into office virginia was bottom third in job

growth and candidate italy. com -- candidly companies saying they were ready to move away. a lot of work and excited to provide tax relief first two years and able to make site readiness, virginia's business climate made better by streamlining regulations and cutting red tape. i hear e it every day from business leaders and we needed to get on our power challenge, because virginia's power needs are growing faster than the nation. so we needed to have an all-american, all of the above power plant to meet those things. we've made huge strides. also i believe there are moments you have to find common ground. and our general assembly this year wanted to raise taxes. i said we're not raising taxes. we can afford to fund all important things. education, law enforcement. behavioral health reform with the fact virginia is growing at a rapid pace for the first time in a long timing. 240 more people working. provides a lot more state

receipts and we do not need to raise taxes and i'm going to continue to battle to lower them. >> how do you get more people to move here? you said it's an issue and shows in numbers? >> seeing changes in that trend. businesses, of course, choose every day, where am i going to invest? where will we grow? and chair choosing virginia now more you often than not. that exciting. people are as well. people building their careers and, in virginia, and moving here to do exactly that. i think one of the big areas of progress for us is with our great military. we have 150,000 active duty military and over 700,000 veterans. one of the things thatic makes virginia great. we want to keep them. passed tax reform to keep 40,000 retirement benefits from taxed at the state left. i wunt this great work force and pillar of the community to stay here in virginia. >> governor, on a show, can't give you, like, america. best, stay for business every

single time. it's been a while since we've seen you, but you have been on the set and we appreciate it. appreciate you coming on today. i'm probably wasting time even asking you about the vp slot. i can hear the answer coming you've got work to do in virginia and all of that kind of stuff, but is there still a possibility that there could be a surprise and a lot of people think that would be a pretty solid ticket for the republicans of this year, is former president trump and you. a possibility that that could still happen? >> well, joe, as you can imagine, it's quite an honor to even have my name tossed around. i think that reality is, of course, that there's fre ta tremendous talent in the republican party and whoever the president choosing will add additional strength to an already incredibly strong ticket. this election is about strength versus weakness and i think america and virginia are ready to choose strength. we want a strong economy.

we want a strong national security environment. and stop all of the global conflict, and most importantly we want a strong border. i think what virginians and americans have seen the biden harris administration projected weaknesses and president trump will once again restore a strong america. i am very enthusiastic about the prospects for president trump and whoever he chooses as his running mate because i think america is ready to choose strength. >> up until -- sorry. >> people don't believe the polls, governor, that virginia's in play. is virginia in play for republicans? >> yeah. virginia is in play, to remind you that four years ago joe biden won virginia by ten points and then we, the next year, were able a to win it by two. i think that the fact we're talking about economic growth and record job growth and virginia being the top place for business, businesses coming and investing. that reiterates the fact that

virginians and americans know what they want. they have seen it. they want a strong economy. they want a strong america and i believe virginia is in play. just got to go to work to deliver it. >> for the longest time up until maybe a couple week weres ago, even still, you couldn't mention glenn youngkin's name and the donald trump's fame without an arm's length. did something change? something different three years ago? what's your relationship with former president trump? >> first of all my renlationshi is good. we had a great meeting a come weeks ago to talk about virginia. how he could go to work with my support and win virginia. one of the realities, of course, is that virginia was not in play four years ago and it is today. and as i said, i believe that his ability to project strength is so important at a time when america has projected weakness. weakness around the world and weaknesses at home.

we've seen the chaos at the border unleashed by the biden-harris administration and virginians are ready for a change. that is a clear, clear signal, i think, to the whole country. that when virginia, where joe biden won by ten points just four years ago, is clearly ready to vote for a strong president in the white house, i think that's a statement for the country. >> by nature of the main topic at hand today, this state has done pretty well in the last three years. what's economically and however else, what's wrong? what needs to change? >> i think what you're seeing, and i think your rankings underpin it, is that republican-led states have truly thrived. it's where businesses are going, and people are going, and economic growth is happening, because of common sense policies. tax reduction. safe communities. excellence in education. business-friendly decisions as opposed to business-damaging

decisions, and that's where the growth in america has been, and i think that's the vision and common sense that president trump will bring back, that the whole country can grow like this. >> governor glenn youngkin, 74th governor of the commonwealth of virginia. congratulations. america's top state for business and now see where your state ranks and get all the data cnbc.com, more reports about all of this all day today. kelly, back to you. >> call my attention, trying to ban cell phones in schools, governor. maybe very much someone to watch and a policy to watch. scott, appreciate it. appreciate bringing the govern herb as pell govern every youngkin, thanks for your time. after a break, breaking cpi data and pennsylvania senator john fetterman weighs in on president biden's candidacy and questions whether the democratic party to replace the top of s it 2024 ticket. stay tuned. you're watching "squawk box" on cnbc.

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just seconds away from june's cpi and futures down fractionally this morning. unusual. rick santelli in recent sessions -- rick santelli standing by in chicago. can't believe it. ill illinois's not the best state for business? >> shocking. isn't it? so shocking. well, maybe next year. right? all right. now looking at the wires. hot numbers coming out. june cpi -- down 0.1% on headlines. down 0.1%. that kwould equal may 2020. find a lower number go to april of 2020 when it was at its extreme of minus 0.8. that is the first time we've had a minus sign there. that's actually deflation. not necessarily disinflation. now, strip out the all-important food and energy, it's up 0.1.

up 0.1. that's a little cooler than we were expecting. up 0.1 would be the lightest going back to january of '21. and august of '21 would have equalled up 0.1. look at year over year. year over year has been a bit lower in the past, and now it equals that level. 3%. 3%. 3% equals that low i referenced before i saw the data. june of 2023. def to find a smaller number, march '21. 2.6 year over year core, 3.3%. that holds the moniker and also the lightest level going back to april of '21. look at claims. shall we? initial claims 222,000.

minus 17,000 from the revised 239,000. 222,000 is the smallest initial claims since the third week in may, and finally, on continuing claims, it is now up for above 1.8 million for the fifth consecutive week. 1 million 852,000 and that, of course, comps to last week. 1 million 856,000, and that would have comped back all the way to -- going back to november of '21. november of '21. so we obviously see interest rates moving lower. ten year hovering right around 428. now hovering at 419. going to be very important to see which side of 4.25 it closes at even though well below that level right now. look at a two-year note. 451. holding above 460. pay attention that as well.

we see that the pre-opening equities zoomed up. they are now in positive territory from minus 60-ish on the dow futures to now up over 90 points. this goes a long way for potentially a september rate cut, even though many may be pointing towards july. i personally don't think that's in the cards, but one never knows. it certainly seems as though jay powell now has two issues that he can point to for potentially easing. inflation getting closer to his target, still not there, and, of course, the new wild card he pulled out that no matter what inflation does, it's a lot lower than it was. came down a lot last year, and he's now nervous about the labor market and we can point to the two pillars of maximum employment stable prices and then that outlier pillar that maybe isn't quite a pillar, moderate long-term rates. joe, back to you. >> thanks, rick. joining us now for more on the new inflation data wendy

edelberg, economic studies senior fellow as at brookings institution. joe lavorgna, chief economist at snbc americas security. counting on it. wendy, september? september? cut? yeah? >> i mean, i think the next meeting's on the take, you do? >> i do. i do. they don't like to surprise markets, and so that would mean it's not, but if it weren't for that, this is fantastic news. core cpi over the last three months came in at 2.2% at an annual rate. the laker market is at a sustainable pace. consumer spending has slowed. even as real incomes have risen. i think the economy is in a great place and the fed should absolutely be considering cutting right away. >> would that look -- argue both. more or less political, if they did it even earlier? >> that is way outside my lane.

>> september's too late. doesn't help the economy, but it does look like an ease. july could be even better. actually might heb the economy between now and the election. >> absolutely, no doubt, that the -- the fed does not have this on its mind. >> there you go. >> looks worse to me. powell was very smart, joe, last december in verbally pivoting and going on "60 minutes" like bernanke had done in '09 i believe, but the point is he prepared the markets for an ease. look, i could have, told you back in december we had toe do it. then four bad months of inflation. now two good months. to me july and september is too soon. >> why is it too soon? >> one, equity market rallying making the extraordinarily easy. further adding to bullishes in and euphoria in stocks.

to wendy's point. right out in the economy's, i think, i'm negative on the economy, but she make as good point. holding up. labor market looks better balanced. why rush to cut rates unless it's absolutely compelling. in that regard yelling rate cuts and everything else. >> negative on the economy? >> i'm negative on the company because the things i look at tell me we'll soften. the fed doesn't put emphasis on those variables. this is a lagging indicator. my point, be really compelling not accused helping one side or the other. >> wendy, they want to see, exactly how they said this, i forget. basically point ones and twos on the core. seeing a negative, into the territory even fed officials take notice. how many more months do they need to see ask ?

one or two? >> paying more attention to core than headlines. i think we're there. headline fell but core, as i said, last two months, 2.2%. that is actually a little below target for core cpi. you'd expect core cpi to be at 2.4. >> for a 2% pce. >> for a 2% pce. thatna means a little softer on core inflation. >> inflation is about the housing market some say. what do you think? >> i see the consumer finally starting to pull back. so where i've been most concerned is what's been happening to goods spending. real goods spending is down over the last six months, which doesn't surprise me. real goods spending was incredibly strong in the years following the pandemic, waiting for it to fall and it has but not, it seems, because consumers

are feeling incredibly constrained. real incomes are actually up. so it's the best of all possible worlds. we have consumers finally retrenching. we have payroll employment at 177,000 which is a great number, but actually pretty consistent with what i think is a sustainable labor market, given immigration. >> and real wages are still not up. that's the problem. >> there are a lot of different ways of parsing what's happening in the -- compensation. >>s that -- that's just a simple -- >> no. problem compensation can move that around. more and more coming into the labor market taking lower-wage jobs, may well have given the surge inflation, might see real wages falling even as any individual person is actually seeing a pretty strong -- >> people with rent, and

mortgage rates double basically. overall inflation cumulative. joe, up higher. >> i understand -- >> family of four goes to the supermarket. three and a half years ago bought this. today buying less. no, you can't have cheerios. why people don't feel good about the economy. >> why it makes most sense to look what's happening to overall real incomes. real gpi is up. >> income's up because that takes into account all the pandemic stimulus. >> that's long water under the bridge. >> a four-year look at it. why incomes are up. >> but what i'm talking about is real incomes up over the last six months. the last three months. >> the end of the story is important. last few months because inflation's down, real wages turning positive. >>. >> bdata more in line what you'e

saying's cumulativety real wage declines over much of the past three and a half years. sort of a problem. you do see consumer sentiment data why consumer sentiment is depressed. labor market looks healthy on the surface. inflation a problem that's aided to real incomes clearly not effect on people the perception of the economy or how the administration is handling the economy. >> can't keep telling people they don't know how good they have it. you just can't. sooner or later, look, i know where i am in my life, and i think it's insulting to tell them you just, listening to -- >> you got it pretty good, though, joe. >> i do. and i appreciate it, but -- i'm not allowed to do stocks anyway. so i don't have it that good. i don't know, bitcoin. she doesn't -- even though i told her -- >> but in that one, not what you said! >> wendy -- you -- >> labor market is super strong.

i am not going to go tell anybody who is incred blbl frustrated by the world is they shouldn't be frustrated. i think, but i think what we're seeing more on the consumer sentiment numbers is that people have incredible unease about the overall country right now. >> yeah. >> i don't think it's so much about what's happening in the economy. >> right. but part of what you said, why people are accepting -- we got an open border down south. another thing people don't like. >> it's not an open border but we do havie ishhave, allowed pe >> it's not open? >> people are allowed to come in and apply for asylum. >> it's, president biden -- 3.5 million. >> 3.5 million -- >> we can argue. >> ni,anyway, one of the things that fueled the labor market. seen 177,000 over the last three

months. >> discontent of people in the country. >> it is not ideal immigration policy by any stretch. >> i'll weigh in on this. pretty good, but -- i will say one thing i would -- like gdp, i see gdp weak in the second quarter. first quarter take out of housing services. but anyway, i believe this unemployment rate is a problem. 3.4. up to 4.. a bad sign. >> "squawk box" will be right back. john fetterman, the senator. 70 degrees and sunny today. amelia, unlock the door. i'm afraid i can't do that, jen. ♪ (suspenseful music) ♪ why not? did you forget something? ♪ (suspenseful music) ♪ my protein shake. the future isn't scary. not investing in it is. you're so dramatic amelia. bye jen. nasdaq-100 innovators. one etf. before investing, carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com.

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our next guest one of president biden's staunchest defendering following that widely panned debate performance two weeks ago. joining us, democratic senator john fetterman of pennsylvania. a pleasure, senator to have you on the show. saw you at the white house correspondents dinner, almost brought up a picture. i took a selfie with you. a really fine-looking tux on.

it had a hoodie and a bow tie that was drawn on it. i don't know if -- you remember -- but you were the most elegant. >> you know, i've been watching you for decades. we have, back be in the late '90s. >> excellent. since the debate, senator, it's almost been like a -- it looks like a sign wave almost. and i don't know what to use to measure what's going on in the prospects for the president, but i use some of the betting sites, and initially it had switched. flipped, and the vice president was favored. then president biden came out with a very strong letter and a call-in to "morning joe" and flipped back up, but now it seems like there's some wavering from some of the leaders in the party, and they don't want to say it out loud, but reportedly

behind the scenes, there are some important democrats that are starting to waffle a little. would you at least concede that? >> well, what i won't concede is that

a different opinion, i'll never understand how we could abandon a great president. now, especially. if to anyone that's watching this, ok, what your network, i'd like to point out or compare that to a rough debate. it's like the dow jones has been up 28% since january of 2021. nasdaq is up almost 40%. the s&p, up almost 48 and almost 16 million new jobs. now, i can't imagine why somebody who's watching this right now would say, well, would i take a rough debate or this amazing economy kind of statistics on that, or would you rather have a rough economy and he could have had a great debate? it's a strange choice right now, but my choice has been very easy, and it's going to be for joe biden. >> yan that part of your calculus -- and i agree with you, president biden was one of your staunch defenders. you had a rough debate as well,

and i think you're someone that, you know, at least knows what the president is going through at this point. but senator, maybe the realities are that some of these donors that like to throw their weight around, i mean, why we care what george clooney thinks is -- i haven't figured that out yet. somebody needs to explain that toe me, but tif you do lose donors and poll numbers make it seem like somebody else would have a better chance to hold the house, the senate, the presidency, does it become too difficult -- >> polls are in flux. they change. remember, anyone in 2020, biden was up by 5 to 7 points, and i had been arguing at that time that this is going to be much closer than that. it's going to be very competitive. it's always going to be close. in '16, '20, and '24. if you've raised and supported the president and raised $28 million and then turn

around, it's going to take many multiples of that to undo some of the things if you want to go against the president. i don't agree with that. but for me, my point is that the president has already -- he's been our guy. he's won the primary, and there was an opportunity to run against them and make their case, and the only guy that did that was the gelato guy, and that didn't go very well. so, here's where we are now, and the question that i would ask to anyone watching this right now, the economy has been a banger under joe biden's presidency, and it's been incredible. after a lot of people were thinking that it was going to be cratering and it was a recession. and it's just not true. so, what would you rather have, the kind of economy that joe biden helped brought us or the fact that he had a rough debate and nobody knows what a rough debate is like after myself, and it's also another -- it's a fact. debates do not determine who's going to win.

whether it was clinton -- clinton wiped trump out, and of course she didn't win. and of course, obama really lost badly in a debate, and of course, he won. and even if you go back to kerry as well too. it's not statistically meaningful about the debates. and if debates were that important, i wouldn't be standing right now at the rotunda talking to you as a senator. i would have a lot more free time in my schedule right now. and i'm proud to stand here for the president, and i'm going to do that later during this lunch, and i'm coming in ready to that, and i think we're going to have other people to defend the president. >> let me just ask this question on the public's mind, though, senator. is this really about a bad debate? didn't the debate just tell us who the man is? that's why people are so upset. everybody has a bad debate. the big deal is whether the president is capable of doing the job now or would be in one, two, three or four years' time. >> well, all i can say is it's

where he is right now. and i spent a whole day with the president. we went all across pennsylvania. multiple events, and he was sharp, and he was fully engaged, and now, when you get outside of that kind of a bubble, people were thrilled to be with him. they were in a line to have a selfie with him, and they were cheering. and these weren't -- this is -- they were organic, and i witnessed that. now, i, of course, if i thought that maybe joe biden wasn't the guy, i certainly wouldn't be saying it publicly and putting it in t"the new york times" or n "the washington post," but right now, here we are now. like, i was with him, and i am proud of him, and that's why i'm here talking to you today and in other kinds of outlets to just let people know joe biden is our guy. he should be our guy, and quite honestly, you know, he deserves our support throughout all of this, and i do believe he's going to win, but of course, it is going to be close, even though it has been, and that's going to continue.

>> he's got the delegates, senator, and you went through the normal channels of how to do things, and theoretically, it's his choice, and he would have to be talked into, i think, not being the nominee, but just listen to this for a second, senator. former house speaker nancy pelosi, we all read the letter that president biden said. he is committed to being the nominee, so why would she, yesterday, say, "it's up to the president to decide if he's going to run." we know that he's decided. she says, "we're all encouraging him to make that decision, because time is running short." and the code is, she's saying, we're all waiting for him to make the decision to drop out, so he's lost nancy pelosi and supposedly schumer is murmuring the same kind of stuff behind his back at the same time. do you think, eventually, that your side on this and the president's side will win?

>> well, the president has made that decision on that, and of course, she was an accomplished speaker, and she's absolutely entitled to have her opinions on that, but i just don't -- i mean, i really don't agree with all of that. and if anybody this afternoon comes with a, we need to take gramps' keys away kind of thing, i'm going to push back in the strongest terms, because he is our guy, and he has run an amazing term as president by any metric, and as i said, i have spent time with him, personally, and i have seen that, and i believe he's going to win. and i would much rather have a guy that didn't have a great debate versus the other guy that had a debate and most of it was lies and bizarre and unhinged. >> so, senator, i think a lot of the public is thinking through, as well, the issue of, if something happens to the president or if he's not capable of serving out the term, that leaves vice president harris to step up to the job.

would you feel comfortable with her? this is a -- this is the biggest moment ever for her after what we've all seen about what's going on with president biden. is she ready for this moment? >> well, the vice president is very clear. she's all in for joe biden, and i would like to remind everybody that he appointed her as the vice president because he knew that she was, god forbid, if she has to step up and take that job. and i do believe she would make an incredible president, but i don't think that's her moment right now. and now she has said anything to the contradict that. so, we have an amazing team, and if anyone's inspired -- more inspired by the vice president to be at the top of the ticket, you're still voting for her if you're voting for joe biden, and i haven't met a voter that says, well, i'll go with trump. it just doesn't make much -- again, joe biden has made these

incredibly great choices, and that's why we have the kind of ticket that's ready to roll and get us through into november through this incredibly difficult election. but he is going to prevail. >> senator, we've only got about five seconds, ten seconds. do you think david -- what about the other senate race? any comments on that just real quickly? 10, 15 seconds? >> yeah, well, joe biden's my guy. later today, i'm going to show up and i'm going to remind people and i think i'm going to have allies in there, but i'm not going to change my -- that. and i want joe biden to know, you know, this is his choice. he's already made that choice, and i have his back, and we all should have our back here and if any kind of our party decides to try to push him out, then that could become a party that is going to deserve to lose. >> appreciate your passion on

that, senator. good to have you on today. thank you very much. we'll be watching. thank you. going to be -- first, they've got that meeting with the senate -- biden's -- 5:30. >> the big boy press conference that they keep talking about. >> futures have turned negative, by the way, after cpi, after that deflation. >> or after -- >> surprising turn of events. >> or after his comments. >> thanks for being here. make sure you join us tomorrow. "squawk on the street" is next. you have a phone call. ♪ good thursday morning, welcome to kw"squawk on the street," i'm carl quintanilla with jim cramer, david faber at post nine of the new york stock exchange. futures tried to erase some morning losses as june cpi gives us our first month on month deflation in more than four years. shelter slows down dramatically. ten-year yield drops to the lowest level since march. our road map begins with a rate cut outlook. inflation does fall in june. >> plus delta shares are