good morning. welcome to "squawk box" here on cnbc. we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. yeah, here we go. it's a thursday. there was a lot of activity yesterday. you actually had the dow closing above 41,000 for the first time ever. this morning, it is indicated down 44 points. s&p is down 8 and the nasdaq up 62. this comes after the dow was up 244 po4 points to hit the recor high. the s&p was down 1.4%. the nasdaq was the big loser. it was down 2.8%. this was the biggest decline for the nasdaq since its worst day

since all the way back to december of 2022. it was dragged down by some of the chip stocks. nvidia. >> 512--point loss on the average of 18,000. we would be all over a 500-point gain or drop on the 40,000 average. why we're not mentioning more of 500 points on 18,000. >> the worst drop since december of 2022. >> after it has been like this, obviously. >> yes. a weird reversal to see the dow under performing. the russell 2000 out performing the last six or receiseven days. br broadcom and qualcomm falling 6% or more. they are rebounding this morning. less than 1% for broadcom and qualcomm. nvidia is up 2.3%. advanced micro up 1.75%.

this has been the stocks which have been on a tear for so long with nvidia leading the way. we will continue to watch this. we have seen incredible out sized gains. let's look at the treasury market. the ten-year is yielding 4.18%. the ten-year yield is coming back down after pushing above 4.2% recently. meanwhile, let's talk politics for a moment. president biden testing positive for covid yesterday. the white house says he is experiencing mild symptoms and willis l isolate in delaware. he is vaccinated. the white house will provide updates on the status. biden's x account with a post that said i'm sick followed by a post that read of elon musk and his rich buddies trying to buy this election including a link to his fundraising campaign

page. this comes as pressures is mounting on the president to bow out of the race. congress member nancy pelosi tells biden that polling shows he cannot be reelected. we heard news that chuck schumer and democratic leader hakeem jeffries have told biden it would be better for the country and the party if he ended his campaign. and adam schiff publicly calling for biden to withdraw as well. lots of pressure mounting beyond the covid piece of it. the question now is what the president is going to do or not do. what do you think? >> then the question is who would live to these people and convince him and find a graceful way out. >> the next question is given what seems to be with the republican national convention

and a lot of attention to it, but after the president was shot, the former president trump, the swell of goodwill he has garnered from the situation, if you are governor whitmer or name your democrat, you think you have a chance in 2028, are you saying i'm stepping into this right now? >> it is never about the vice president. she's the heir apparent. >> i know that. i also know -- >> you really wish it would be someone else. >> no, no, no. >> you interviewed her? >> i interviewed her. i like her. it has nothing to do with that. >> give her a shot. >> whether from the polling perspective, can she win? >> the problem becomes that no one else has received the votes from the democratic voters. it looks at the last moment like some takeover. >> the democrats --

>> without any representation. >> that party can't do that. >> i know you want her to run. >> no, no, no. that's not what it is. i know well enough -- you thought i wanted president biden? what i really want is i thought it was just watching know all along know where he was and didn't care and suddenly it becomes clear and they pull the rug out. george clooney is the poster child for everything wrong with bi joe biden. the democratic party prides itself on inclusiveness. >> here is the fundamental question, biden said the only reason he is running because he believes he is the only one to beat -- to me, the only rationale argument for him to step away is for him to say he believes there is another person that he believes can beat trump, not just that has a chance. >> none of the polls show any of those people. >> that's why it is hard for

him, too. >> you think i have these hidden -- you don't think kamala harris can win. the only reason you are saying this is you want to win so badly. >> i'm not trying to win anything. i'm apolitical. >> then you're channelling or looking at what democrats are thinking and realizing they don't think she can win. >> correct. that is the prevailing view. therefore -- it's not what i want. if you are trying -- >> how come democrats tell you that make mark kelly would be good or democrats told snu. >> yes. >> the problem is it looks like big donors who are choosing other than the voters in the primaries up to this point. >> for once, the democrats are totally in chaos and the republicans seem to be united.

i thought it was weird. i don't know if any of the main people do their own twitter accounts. watching the "i'm sick." that was so obvious someone in his staff came up with that and wrote it. he's got other problems. >> he has all of the fundraising emails from all these people. >> i don't know who signed me up for all of them. >> i thought it was weird that he would be saying "i'm sick" and later followed up by of all -- let's talk about the gop and republican national convention. jd vance taking the stage at the convention. eamon javers joins us with more. he made a lot of comments and news. >> reporter: he did, andrew. the ohio senator just 39years old and heir apparent to the maga movement in 2024 if donald trump loses in the fall or in

2018 after the second term, jd vance will be in position to inherit the powerful political movement in america. he used the opportunity last night to tell the story of his own personal history and make a generational contract between himself and joe biden on the democratic side. he also used the opportunity to indicate a shift to populist economics on the conservative side and make a break, rhetorically, with big business. here's what he said. >> we need a leader who is not in the pocket of big business, but answers to the working man, union and non-union alike. a leader who won't sellout to multinational corporations, but will stand up for american companies and american industry. >> reporter: now that idea of

reaching out to union workers and worker first economic policy is really part of this populist economic evolution on the republican side shifting away from the focus or allegiance to corporate elites and reach out to the union votes that republicans think are gettable for them this cycle around. you saw the teamsters president here in milwaukee making a speech to this republican national convention. that is all a piece of an effort here to be more pro-union worker. we saw jd vance breaking with wall street. here's what he said. >> we're done, ladies and gentlemen, catering to wall street. we'll commit to the working man. we're done importing foreign labor. we're going to fight for american citizens and their good jobs and their good wages.

>> reporter: so, i think the thing to look at here is distinction that jd vance is making with multinational corporations and american companies and american manufacturing. i think jd vance looks at the world and sees these large global institutions as less american than domestic manufacturing certainly would be. i think as you look at this republican party, you've got to see a populist change and a change in direction in corporate elites and wall street. guys. >> eamon, that is jd vance's perspective and personal plank. the question is if this is former president trump's plank and how much in agreement they are or not on that? >> reporter: we don't know, right? obviously, you have to win the election and then get in office and implement policies.

we're a long way from all that. rhetorically, this is a shift. jd vance and donald trump's team can take anything they want out of jd vance's speech and add anything in. the fact that jd vance was saying those things on the stage of the republican national convention last night indicates that republicans see this as a winning message both with their base in the hall, but also nationally. they are aware they are reaching out to the maga faithful here in milwaukee, but also reaching out to republican voters and voters generally nationwide with an address like that in primetime. they could have taken that out and they didn't. >> there's different ways to try to, you know, carrot and stick domestic production and manufacturing and jobs and everything else, eamon. >> reporter: right. >> i think we had the cfo of

johnson & johnson on yesterday. i don't know if you saw the interview. >> reporter: i did see it. it was a good interview. >> it allowed johnson & johnson to shelf plans to manufacture abroad and made it economically feasible to do it in the united states. i don't know when vance talks about, you know, wanting to create good american jobs and not outsource jobs, i don't know whether that is the same as saying i'm okay with going to 28%. that's what some of the people -- >> reporter: i don't think you can draw a straight line there. >> no, if jd vance wants to go to 25% or 30%, trump is going to say that's not happening. trump said 15 yesterday. on the other hand, you might try to do it with tariffs. what would another trump economy

look like? if it is loaded with trariffs ad other protectionists policies, jd vance might like that. >> how inflationary is that? >> reporter: that's a great question, becky. one example people were talking about in milwaukee here yesterday, there was a wall street analyst note about the healthcare sector about the trump administration on the healthcare sector. in the note, we will probably get a less regulatory ftc and in the healthcare space. that is big for the healthcare giants. a lot of people think that is directionally long. tr trump would be more aggressive in certain sectors that are the not liked by the maga base. if you look at the general approach of what republicans will come in and be

deregulatory, in cases like anti-trust, that is completely not true given where the republican party is now and where it wants to go in the future. >> is there an idea that lina khan would stay on? jd vance said he really likes her. >> reporter: i can't get a comment out of the ftc if she would stay on or not stay on. jd vance said he likes her. i imagine they want their own person, but i imagine that person would be ideologically be close to lina khan or more aggressive on tech. >> eamon javers, it is fascinating. thank you for your reporting on all of. it coming up, chip stocks are moving. we'll dig into the trade coming up. and later, representative tom emmer will join us from the republican national convention. "squawk box" will be right back.

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on today's squawk planner, we get the latest ecb rate decision at 8:15 a.m. eastern time. the investors expect the ecb to leave rates unchanged. in the u.s., the jobless claims are due at 8:30 a.m. eastern time. on the earnings front, we hear from abbott labs and alaska air and domino's pizza before the opening bell. domino's pistzza is off 8.5%.

jon gray from blackstone will join us in the 8:00 hour. that is a first on cnbc. you can see netflix shares below $41,000. and tnasdaq tumble d which the worst day since december of 2022. let's bring in sylvia jablonski. not only do you think a.i. and chips is the way to go, but this gives us a buying opportunity in your view in some of the names that pulled back like nvidia or take your pick, but also you think since there is a rotation trade, you need to branch out with other players in a.i. that

are less well known? >> yes, good morning, joe. i do think this is a buyable dip here in chips. as you said, you can pick your chip. look at amd that was down low double digits or star chip nvidia and i think the trend continues. the global story is continuing. you have healthcare looking for data processing for better trial outcomes and medicine. we know the a.i. story. you will see cash coming off the sidelines into that. people have been looking for that healthy pull back and we got it yesterday. then, to your point, diversification matters. you have to sort of pay attention to what we're hearing, right? you have potential president coming into office who is favorable on domestic onshoring for all industries. small caps are u.s. based and that coupled with rate cuts

helps. you will see a rotation there and investors are showing us that is just what they're thinking over the past week or so. >> the economy that we're in is not, i don't know, you are not buying manufacturing companies that build things or can benefit from infrastructure. your timing moves back in or in a different part of a.i. and tech. is that the entire economy and stock market is still controlled by that little, i guess it is not little, but it better be good. it takes a big leap of faith. >> yeah, i mean it will be good because we essentially need it to advance and continue to grow gdp in coming years. i think you have to be allocated in one way or the other to the a.i. trade. the mag seven, whether or not they are overvalued, earnings are kind of justifying that and the continued growth is justifying that.

a.i. is the growth component behind that. you need allocation to infrastructure with washington. your gains are more likely to be had. buying on the dips on the stocks that will continue to grow for the next five or ten years and you said expanding the a.i. ecosystem. expanding uranium and the things that are required to run the systems. lower latency. the 6g trade. there is time to do it. >> there will be a lot of geezers, old people, what dabou it? what about banks and financials? i don't know. give me something besides a.i. >> something else. healthcare is a good one. you have glp-1s. lilly and the menu of medication

with diabetes or aging baby boomer population. the market pulls back and you need to consume that product regardless. i think the top healthcare stocks with the etf or one of the leaders out there like eli lilly is a good place to look as well. and small caps. small caps other than a.i. going back to that. you can look at the etfs that offset. if you don't, you are getting a lot of income with the volatility in the space. i think there is a lot of good in etf products in that space, too. >> energy stocks? less than renewables? lighten up on solar and wind? >> i think if we look at where the election is likely to go, that might be, you know, that might be what investors are thinking. you could potentially lessen up.

there is this global mandate to go carbon neutral by 2050. there is the new relationship with elon musk and perhaps you get data that sways the minds of where investments should go. it will be something on my list to look at, but not diving into just yet. >> all right, sylvia, thank you. >> thank you. >> people like defiance now. that's a big thing. >> i know. thank you. they know we're alive. we love it. >> defiance. it's a really -- coming up on the other side, deere is the latest to bow from the activist investors online. we'll tell you what's going on. we'll show you what the company just said next. it's hard to run a business on

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welcome back to ""squawk." deere is dropping dei initiatives. it will no longer include the parades and affirm the existence of diversity is in pronoun identification has never been a company policy. deere said the diverse work force allows it to best meet its customer needs to track the diversity in the organization. the black farmers organization is calling for a boycott of the company and calling for the resignation of the ceo. all of these things getting more

complicated every day. when we come back, shares of nokia under pressure this morning after the company reported a 32% drop in the second quarter operating profit. the ceo is joining us next and expects a turn around in the second half of the year. we'll ask him why. as we move to break, we look at yesterday's s&p 500's winners and losers. >> announcer: executive edge is sponsored by at&t business. next level moments need the next level network. i couldn't have done it without you. honestly, i don't do a whole lot here. i'm really just here for the at&t internet, it's super-fast so, any pre-launch concerns? what if nobody buys them? that's mean or, what if everybody buys them? oh, i hadn't thought of that that's probably not gonna happen can we handle that kind of traffic?

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good morning. welcome back to "squawk box" live from the nasdaq market site in times square. the futures look here with the nasdaq up and the dow, which hit a new high, is giving back a little in the rotation trade. you see the rotation trade with

the moves. not that rare. >> dow has been under pressure with boeing. nasdaq has taken off with technology and s&p is made up of the tech names. >> a third of the s&p is two stocks. nvidia was a third of the s&p. >> right. nokia out with the second quarter results. the company doubled down on the push into north america with the company infinera. joining us is the ceo. pe pekka, thank you for being with us today. there was a significant drop in the numbers and as a result, the stock is down 5.3%. you are just off a call where you were telling investors you do expect to see things picking up in the second half. what makes you think that? >> well, first of all, thanks for having me.

the drop in earnings in q2 was very much driven by the declining top line. the top line was down 13% year over year. the important thing is three quarters of that driven by india where the 5g rollout peaked in the second quarter last year. now when we look at our order intake, we have seen positive momentum for the last three quarters. we have been building our order backlog and, hence, we are expecting to return to top line growth in the second half of the year. >> pekka, let's talk about what nokia is because a lot of americans think it is a mobile phone maker. you worked there from 1990 to 2000. you helped build this finnish company as the top mobile phone maker in the world. when you left, it had a market cap of $250 billion. you came back in 2020 to help guide this company. it is a much different company and smaller company than before.

maybe 1/10 of the market cap. why don't you tell people who are not familiar with nokia? >> the interesting thing about nokia, we are the only company in the world outside of china that is able to deliver all key parts of the network infrastructure that is needed. the core network software and transport network and optical connections and both fixed broadband and mobile access networks. there isn't anybody else. why is this important? when everybody is talking about cloud and a.i. and importance of those two, what i'm saying is without cloud or investment in networks, you will not reap the benefits of cloud or a.i. the third component, the high quality network will always be needed and that's what nokia comes in. >> you make the antennas and you

said the united states is your most important market right now. how are things going with that? how are you doing and what is involved in that? >> the u.s. market has been down the past couple years, but there is a sign of recovery. just as one, we are the clear market cleared in u.s. br brandband. clearly, connections run on nokia. pretty much, if not all, 70% of the phone calls in the u.s. touch a nokia equipment at some point in time. we are a strong player in all of the carrier networks in at&t and t-mobile and verizon and very much also in some of the tier two or tier three operators. >> infinera, what is this? we look at it as doubling down. what will this do for your business? why did you make this acquisition? >> it will give us the immediate scale in optical communications.

optical communications is increasing in importance in everywhere in the network infrastructure. one of the things that is driving this market is this huge data center investment boom that is driven by the a.i. applications. infinera has exposure in the data centers. that exposes nokia before to the segment. in addition to that, infinera being an american company, strengthens nokia's push in ame north america. >> in terms of you are convinced of looking for a turn around in the second half is that because of orders you already have booked? what gives you that confidence? >> the confidence is pretty strong because we now have had three quarters of strong order intake starting from q4 last year and continued the first quarter and second quarter of

this year. the plaipeline of new opportunities is good. we have significant customers during the first half of the year. the confidence has been building throughout this first half of the year. >> pekka, i want to thank you for joining us today. obviously, this is an important market for you all. we hope to get to see more of you. we do appreciate you coming on today. >> thank you. >> thank you. coming up, volvo shares are jumping this morning after a reported strength in its all electric and hybrid everything ones. we'll bring you that next. check out shares of domino's pizza falling after the quarterly results. topping estimates on store sales narrowly missing estimates. domino's expects international sales to fall below its 2024 goal of 925 net stores as a result of challenges in opening

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welcome back to "squawk box." shares of volvo are higher right now after the company reported a 28% jump. sales up 15% by the rise of hybrid and fully electric car which accounted for 58% of global sales. and we have more coming up with the reaction of jd vance's policy on scchina. as we head to break, here is a majolor ok at the currencies.

"squawk box" coming right back. >> announcer: currency check is sponsored by interactive brokers. the best informed investors choose interactive brokers.

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we will protect the wages of american workers and stop the chinese communist party from building. >> welcome back to "squawk box." that was senator jd vance speaking at the republican national convention as china ended the third plenum. we have the former ambassador and visiting lecelelecturer.

>> thank you. >> let's get into jd vance's comments and what is happening inside china with how our relationship is going to go. our thoughts on jd first? >> clearly, vis-a-vis china in that room and more generally in washington, has been very tough with the expectation that they were going to impose more barriers both on exports of high technology and the kind of equipment that the chinese use to make computer chips in particular. >> what do you think the chinese think of our election right now? >> i think they're confused as i think many americans are. they have made the point for a period of time, for a number of years, xi jinping has been saying the east is rising and the west is declining. when they see all this stuff going on here, the partisanship,

the ranranqor and the people trg to assassinate the former president. they may admire our technology, but they're going around the world saying the american political system which the u.s. has touted for so long is no longer a functioning democracy. that gives them some confidence they can make the argument around the world that their system is working more stably. >> can i ask, chaos here is good for them. do you think they are sowing seeds of dissent here on social media and other places? >> i don't know the degree in which they are doing this, but any sort of dissent that goes on here and the fracture of the

system gives them credibility. they have big problems in their system. i don't think i would advocate for their system, but they're making a point, not here, but around the world that their system is more stable and doesn't have this kind of internal friction that we've got. >> yeah. >> you either get killed or go to jail. >> yeah. >> nobody -- you can't tell me what our taiwan strategy actually is because it's strategic ambiguity. trump, the way everybody is talking about trump said. they need to pay us. why should we defend? taiwan stole all our chipmaking prowess. he says he defends war. biden said we'll defend it. they said don't say that. >> it is totally confusing. >> they have no idea. if they are looking for

ambiguity, we've got it. >> absolutely. we should take a look at what the chinese are doing. they are now realizing that the united states is imposing more and more and will continue to impose more and more barriers on any sort of high tech technologies, continuing to poi more barriers on technology that advances military capability. so they're putting money in, not to roads and highways and bridges, they're putting money into quantum and to a.i. and to 5g and 6g, "a," they don't want to be levered by the united states. and "b," they want to enhance their strategic ability. >> and what would they do? they look like they're getting ready to take taiwan back, doesn't it? >> i don't know what they're doing. i'd just like to make one point, though, on the notion that the chinese, particularly, the taiwanese have stolen our technology. american companies rely on

taiwan's semiconductors. >> right. let me ask a question -- >> what factors make -- to make it political, which candidate do you think china likes to work with or thinks they work better? >> he's a democrat. >> i understand. i understand. >> i think they've been surprised that biden has now pulled back from some of the things trump did. on the other hand, the chinese like order -- the disorder and the fact that they don't really understand what our objectives are, i think, is confusing them. >> right. >> and i suspect they probably would prefer trump, because there's a lot of disorder. >> right. >> and he's made these statements. on the other hand, by making the point that he wouldn't defend taiwan, that probably -- >> right. >> -- encourages them. >> what do you make of the more recent news we've heard that the biden administration wants to sanction folks like asml which helps with these chips in the netherlands, for example, or

some of these other outfits, outside of the country, where the chinese are gaining access to technology that they're not supposed to be? >> well, i think there is an argument to be made for making sure that they don't get technology that advances their military capabilities. >> right. >> and whoever is doing it, the united states should take a strong view and try to stop that. so, i don't argue with that point. >> okay. >> i think that the chinese, though, understand, first of all, that they cannot rely on the u.s. or the west. because in any military circumstance or even in any circumstance where we're competing for technological leadership, the united states could use chinese dependence on american technology. the chinese could be leveraged by it. >> bob, i want to thank you for coming in this morning. fun insights on all of the stuff. >> thank you. >> thanks. when we come back, we'll dig

into the united airline report. profit jumped more than 20% in the second quarter. but the current quarter forecast missed expectations. that stock down just barely by nine cents. we'll have more on that in just a moment. and later dr. scott gottlieb has been testing the mental aptitude of top i.a. models. he's going to join us with the findings coming up in the next half hour. "squawk box" will be right back.

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bernstein senior research analyst. let's talk a little bit about this, david. it looks like there are other carriers who are cutting their rates. but they charge consumers just to try to make sure they're able to maintain domestic travel at this point. what does that mean? what do you see happening? >> so, i think it's a little -- it's definitely weakness on fares right now. but i think it's really the industry grew tool fast relative to demand which is pretty healthy. we overshot on the capacity situation which is creating negative pressure, particularly in the main cabin. we've known this since the american conference several months ago, and the delta. and the 3q to be light around where they guided. i don't think this is a negative surprise where sentiment was coming into it. >> this feels like the same story again and again with the

airlines. where they don't have enough capacity, they try and chase demand. they get to overcapacity and then it becomes a problem from a profit perspective? >> you know, there's definitely some elements of that happening again. i think what's different, though, is that in this period of overcapacity, carriers like delta and united are pushing very good earnings. while discounters who would normally be adding that capacity to take share are not making enough money. southwest has a lot of profit problems. spirit has profit problems, and they're shifting the burden of over capacity on to carriers. the only option is to reduce fares which is already for delta and united and operating within the margin. >> why is it different this time? what happened? >> i think it's a little bit how the airlines are bringing capacity to market. historically, the industry has had a one coach fare they're

trying to price down to fill the cabin with and if you've got a cost position and a product that's out for sale that is isn't that different from lower cost position, you have a lot of negative pressure on your fare ladder. what the industry has done led by delta and now followed by united more closely is really segment that cabin into different products. but a product out there that is a basic product very similar to a discounter. that capacity now flooding the market on the low end of the space is from delta, united and american, but it's not negatively impacting the entire fare line. farther up in the cabin they have comfort products at higher price point. you get to bring bags. they've taken away change fees. they've added amenities to products for consumers that have been lost for decades in the industry. >> what do you think about american, delta and united shares? >> i mean, america is a little harder to defend these days because they've got commercial leadership problems.

i think with delta and united, it's a cleaner story. united, in particular, if you look at the two stock prices they're not dissimilar. delta and united, 46, 47. at the same time in 2024, united is going to be earning 9 to $11 a share and dealt in the 6 to $7 range. there's a little in the pricing there. there's an upside to united if the industry can go ahead and rein in its worst behavior on the capacity side. i think that's going to come out on the low end of the market which is going to be really supportive to the higher margin airlines during 2025. >> if you had to pick one between united and delta, which one is it? >> i think it's united given the mispricing. the stock is about the same price and they'll earn 30% this year. >> david, thank you for joining us this morning. >> thanks very much. it is just after 7:00 a.m. on the east coast. you're watching "squawk box" right here on cnbc, i'm andrew ross sorkin with joe kernen and

becky quick. a lot going on. wanter brothers discovery report plans to split tv and television networks, warner brothers market value has dropped by a third in the past. the company considered mergers with nbc yumpsal and paramount. "wall street journal" says beyond me is now speaking with a group of bond holers about restructuring its balance sheet. that stock sinking shares down 20% this year. we should note, beyond meat's market cap has fallon. >> news out of washington, president biden testing positive for covid. the white house saying he's experiencing mild symptoms, he's been isolating in delaware. he plans to carry out all of his duties fully, they say, during that time, joe. >> checking the futures and also the highs on beyond meat. that was -- oh, my word. >> oh, my word is right. oh my word is right.

>> $170 -- no, wait a second, $196. and it is now dropped all the way down to $7. so, it's 465 million. so, we need to multiply by whatnowhat, not quite 30. at one time, it was a 10 or $15 million company. what happened? >> when is the last time you had some? >> i was never a big beyond meat guy. >> dom chu, are you eating fake sausage -- >> i will say this, i've tried the beyond meat products. i'm neitherer here nor there. i'm trying to eat nor vegetables. there are more vegetarian options that taste better for me. plus for me, i'm kind of more

aware of the sodium content in food. >> yeah, healthier. >> for some of the alternative meats, the sodium content becomes more excessive. more than i'd like. any way, guys, so moverswise kicking things often in an earnings-related story. taiwan's semiconductors, marketing reacts to the report happening overnight in asia. the company beat profit and expectations helped by continuing demand in advance chips specifically those used in artificial intelligence applications. taiwan semi, rememberer the world's largest producer of micro processors in nvidia and apple as well. taiwan semi, a good chip story. from asia, shares of novartis are slipping. stock down nearly 2% at this point. this is despite reporting second quarter results of expectations, the swiss pharmaceutical company also raised its profit guidance

for a second time this year. those results were boosted from revenue in blockbuster from the best-selling heart drug. novartis shares gained 11%, 12% over the past years keep an eye on those. ending with a key analyst regarding apple, amazon and lily. they're ticking higher, fractionally speaking. 'ing, morgan stanley. apple and amazon, eli lilly up a percent or so. the firm's analyst thinks each of those three stocks amongst a slate of others will exceed expectations with reports later on in the season. keep an eye on those. by the way, for for those and more analyst calls head over to cnbc.com. for the stories, keep an eye on those, joe. i'm going to check out the market cap issues that beyond meat is having right now. >> sure, dom. you're not watching the opener?

>> i will admit, because it is on peacock, i have had on my ipad. >> no way -- who is that -- who is suited for that course, do you know? >> for that course, from an apartment standpoint, i just tend to think about guys like jordan spieth because he's had a pretty decent career at open championships. i think the good story is macintyre, after coming off the scottish open side of things. you know me, joe, i'll pick rory mcilroy because i just think he's so good at this point. >> he is, he does something with peacock, too. >> yeah, with the golf pass product. i will say this, though, i watched scottie scheffler, videoing him, practicing his alternative shots around the green, it's actually fun to watch. open championship golf is a lot more, in my mind, creative, than other certain parts of the golf world. i like watching links golf for sure. >> some of us identify with

scottie scheffler with the way his feet move all over the place. i think his feet movement might be different than mine. mine are not quite as -- could be my left foot. could be my right foot. >> we'll call it happy feet. >> happy feet. >> i'm going to watch "happy feet" right now. >> that was a good little movie. thank, dom. >> you got it. ken griffin, the founder of hedge fund he's now paid $44 million for a stegosaurus fossil. it's surpassed its estimately 11-fold at sotherby's. and griffin confirming to the financial times that griffin was indeed the buyer and intended to put it on display at a u.s. museum. griffin gave $6.3 million to a

united states museum for a -- >> for a titanosaurus. >> it was 150 years old -- >> that would be jurassic park type. >> that's coming soon to a theater near you. >> i think there is more. supposedly, they could do -- i think a woolly mammoth. >> that's what we've been talking about. >> they might be able to do that. maybe it tastes good. >> i was going to go -- >> i know you would, because we can't do beyond meat, what about mammoth burgers? >> no, you don't bring it back just do eat them. >> how are you going to control them, huh? a farm of these guys. >> an island. nothing could happen there. >> we've seen that movie. when we come back, reaction to jd vance's speech last night at the rnc. and a preview of what to expect from president trump tonight.

plus, netflix, ahead of earnings, we'll have a preview what investors should be looking for when they report after the bell today. "squawk box" will be right back. ♪ (vo) a law partner rediscovers her grandmother's artistry and establishes a charitable trust to keep the craft alive for generations to come. from preserving a cultural tradition to leaving a legacy, a raymond james financial advisor gets to know you, your passions, and the way you enrich your community. that's life well planned.

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that we've seen is a bad thing? it's just universally something that people wanted if you are bullish, this is helping? >> right. yeah. i do think the summer rally that we got in 2024 has gotten healthier. we like the participation at the index level also at the stock level. so, you know, what's very important, the s&p 500 will have a new high, nasdaq, and nasdaq comp. last month, the other indices did not. but as of last week, you also got new highs for dow industrials, the nysc. and earlier this week, the s&p equi-index went out on a high. and a lot of improvement, more participation, tends to be hittier for the market. >> the russell is how far from a new high? >> well, i mean, if you look at iwm, it's the old high was right around the 244 level.

the base actually suggests that iwm could trend towards 260. >> uh-huh. >> s&p hit a target. 5600. that's the target we have for summer rally. >> can you raise it? >> i think we can go to 6150. that is projected from the breakout. >> 10%. >> yeah, 10%, something like that. it may not happen tomorrow. it could happen -- >> probably not tomorrow. >> no probably not. it may not even happen this year. but conceivably within the next, you know, 12 months or so, that is a possibility. >> some them, tom lee said 40% more in some of the small caps. of course, it's moved some. in near term, you think it could happen that quickly? >> yeah, the mall caps have a lot of pent-up buying that's what it looks like and just started breaking out. so think there's to the rally

especially with what is completed. small caps, definitely. >> is it because rates are coming down? because the economy is hanging in there? what's more -- what's more important? >> it's probably the combination of the two. i think it's really all about positioning when you think about it -- rotation actually is the life blood ofa bull market. i think that's what we need to talk about to some extent. >> okay. >> because you have tech names that have overshot technical projections. you know, you go from a ringmatic chart and saying all right, we go large scale and target that just tells you that things are getting extended. >> but the idea of a bull market continuing is really reliant on those tech names not falling back so much? >> exactly. so, we think it's more of an underperformance here. it may not be today, it may not be tomorrow. but if you throw normal levels of the nasdaq, i mean, there are normal, healthy levels where a

market can pull back, where you can enter into it at a better and more oversold level. so, we're viewing as corrections and uptrends. and we don't have divergences prevalent on new heights confirmed by rally. volume indicators, up-volume has confirmed the rally. you look at fed conditions, another high there, or another improving indicator there confirming the rally. so this is not like late 2021, or early 2022. this is more like a midcycle. cyclical market. if you step back and look at secular view of trading, there could be a few years left in that secular trend we're talking about. >> we don't have down periods. we barely have down days in terms of volatility. >> right. >> is there any indication in any of these things you're

looking at of overstimulation, or overheating? >> right, right. >> i mean, can you see anything anywhere? >> right. first and foremost, summer is a good period. especially in election years but seasonality will be a more headwind into august. >> because october is kcoming. >> right. >> winter is coming. >> winter is coming. >> you look at the gauges. >> unlike a month ago, you're starting to see more bulls in the market. >> you are? >> definitely. >> but not a problem level yet? >> i mean, it's getting closer to where it was in the middle of 2021. but then, again that didn't coincide with the high in the market. usually get the peak sentiment and then that drops. i also put attention to the call ratios have gotten higher. 25-day call ratios are at levels of complacency. this could set up a weaker season period.

the condition is there for a weaker season period back to start to be reflecteded in the market, meaning perhaps a september/october phase. >> thank you. securities chief equity technical strategic. meanwhile, let's bring you some news, just crossing the tape. blackstone quarterly results, 96 cents a share. two cents below estimates. sales on a total segment revenue basis coming in 2.5 billion. also below expectation. blackstone's chairman said the company realize the $40 billion of inflows and 34 billion in the quarter reflecting the highest level of activity in two years. blackstone's management growing to $1.08 trillion with a "t." we're going to break all of this down with president and ceo jon gray going to join us in the 8:00 a.m. hour, talking about

the results of the activity. he said earlier this year, he thought commercial real estate is bottoming out. and if you look at the charts may have very well spent a fortune investing in the last months. we'll talk about that. up next, republicans welcome senator jd vance to the national convention stage as his first speech as as the vice president. and then need a doctor? how about chatgpt? dr. scott gottlieb administering a medical licensing exam to all of the large language models. turns out chatgpt was the top performer. he will join us to explain how the language models could change medical education. "squawk box" will be right back. for showed's aflac trivia question -- who were the first recorded people to reach the

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people to reach the summet of mount everest. the answer edmund hilary. welcome back to "squawk box." jd vance speaking at the republican national convention accepting the nomination to be former president trump's running mate. >> together, we will make sure our allies share in the burden of securing world peace. no more free rides for nations that betray the generosity of the american taxpayer. >> joining us, jay clayton, former s.e.c. chair and cnbc contributor. the big thing i'd ask you more than anything else and the business community is trying to understand is how much do you think jd vance's views on business and regulation, sort of a shift to a more populist -- even a more populist approach if you can believe than former president trump are the same policies that former president

trump would pursue if he were president? >> so, i watched the speech last night, i've been listening to senator vance. he is doing something which i think is important from an economic perspective which is he's appealing to the everyday american. he's saying, you know, you're making 100 in income. your spences expenses are 95. you're just trying to save 5 for college, a house, retirement. you know, what is happening to you? and, you know, that cohort, that cohort has not been treated well by economic policy over the last 15 years. they were the most adversely affected by the housing crisis. they were the most adversely affected by high inflation. and what do those have in common when wall street and the government get together? and wall street and the government get together, around the globe, what happens? asset prices go way up. and the folks who are looking to

get on the asset ladder, they suffer. >> i'm not going to disagree with you. i think the thing that we're all trying to figure out, though, jd vance, you can go watch hearings where he has, you know, raked over the coals wall street banks. >> uh-huh. >> right? >> uh-huh. >> he has talked about how he likes lina khan. >> he's aligned with elizabeth warren to dot cl the clawbacks. >> there's a real question in the business for better or worse where they sit on the issue? and maybe, where do you think former president trump sits on these issues if he becomes president? >> i think former president trump is going to set economic policy. and i'm sure jd vance will be a voice at the table. there will be other choices that we all know, people like lighthiser and kevin hassert. >> i'm sorry to interrupt,

lighthiser, this american conference group. they want to raise taxes. they want to embolden lina khan even further. they have a lot of -- think of it as classic conservatism, reaganomics, larry kudlow. they say they have jd vance's ear, we're wondering, rightly so, does jd vance have enough sway with trump to get him to say, you're right -- >> where is he going to bring in the voters? >> he's just appealing to voters. >> here's what we're doing, we're looking at this on a bilateral basis. one of the things i know on president trump on economic maters he's willing to listen. >> so corporate rates might go up 28%? >> no, no. he will ask the next question, which is why? why do you think they should go up? >> do you think that's fair, 28%? looks better. >> let me be clear.

>> look, even if it doesn't bring a lot of money, the argument has always been, it doesn't seem fair that you're going to raise taxes in other places to balance the deficit to not raise it, too, or this is just a situation we're not going to care about raising everybody's taxes and pick you can make it up on growth? >> you know, a couple things we know from the last administration, do a smart deregulation. not a free for all deregulation. you're going to have scott gottlieb on, what scott gottlieb did at the fda, was say we've been doing it the same way for 25 years does this make any sense at all. all of a sudden, drug approval much faster. deregulation will happen. >> right. >> but if we're going to listen to him, why pick him? why didn't he pick someone that's on board -- >> i didn't say he wasn't going to listen to him. >> well, if he listens to him, the question if you're david

zasoff, earlier in the news, warner brothers want to sell some of its assets and other things. a lot of big media companies would love to merge with each other as you know. >> uh-huh, uh-huh. >> a lot of them think they can't do that today with a bind with a lina khan and this justice department. they think before jd vance got on board, perhaps in the trump administration there might be the ability to do those type of transactions. does the jd vance at all change that? >> i don't think it fundamentally changes that. i really don't. what have we seen from a lina khan administration? all is bad. you're going to have a much more nuanced -- >> so some big is bad? >> some. if you have a global market, a u.s. firm getting bigger is generally not a bad thing. >> this is something that jon

gray emailed us the irony, the multinationals that mean anything, met as it, the googles, the microsofts, these are the ones who have billions across the world. they give america a disproportionate disadvantage to the world of a.i. but it locks in these are bad things. it's 1950s language you put on top of that. and big tech, that a focus in the next potential trump administration for deregulation or existing regulation that's cracked down pretty hard on that? a lot of those cases started in the last trump administration. >> what part of big tech is really what you need to think about. so, we're subsidizing the heck out of chips, right? we're already saying we're going all in on continued technological advancement. on the side of big tech that makes us all uncomfortable which is how much are they controlling what we and our children are seeing. i think you are going to see scrutiny from the trump administration, but we're all in

on tech leadership. i agree with jon. the benefit to all americans, because of our tech advantage, think about it this way, every person that comes out of poverty around the globe or every person that moves up, say, from the poverty level to the middle class. the u.s. because of its tech leadership and the need to get connected gets a giant dividend. we should never give up leadership in that area. >> let me ask you about tax rates, one of the things trump said in business week this week, he plans to get the rate down to 15%. which is lower than anyone expected. i would argue 21% was unexpected given that the business community was prepared to accept a 25% rate at that time if you remember others came on and talked about this quite openly. >> uh-huh. >> if you bring it down to 15% and you have any ambition to bring down the debt and deficit in this country, you're going to have to make up the money

somewhere. you can hope that creates more revenue at some degree. i think the math gets very complicated very quickly. where does that get made up? does it get made up on the wealthy? does it get made up on the middle class what happens? >> two things on the corporate tax rate. lowering the corporate rate, we look at it in absolute terms. the most important thing is look at it relative terms to the rest of the world. by lowering taxes the u.s. maim more competitive for investment. we started to onshore even more creating more jobs. those are all incredible policy achievements. so we have to be very careful about making us less competitive from a tax perspective. on where do we make it up, i think, you know, the reality train around here is starting to leave the station on a lot of things and one of them is how much more revenue can we generate under any tax gain? you know what, i think you ask liberal economists, conservative economists. there's a cap on that, that cap

is lower than our spending. we're going to have to come to grips with spending. >> you've now heard the word cutting spending during -- >> that's the math. that's the math. that's the math. >> and they aren't talking about doing that either? >> no. >> but you would think republicans might. >> the crux of the matter -- >> what's the maximum revenue you're going to get -- >> jay, the crux is whether tax reductions are still part of the platform of the republican party. because you're hearing that the ascension of jd vance legitimate m s the whole movement. they don't want to cut taxes. they want to raise taxes. the populist movement that he represents, jd vance, if he had his way, is trump -- >> is it a classic reganomics

guy or not? or a class guy? he didn't say it but that's what we heard last night. >> when wall street and the government -- >> okay, that's corporatism. >> that's not capitalism -- >> capitalism will absolutely -- why are we better off -- so much better off than europe in the last 25 years? because we have nimble labor and nimble capital. >> but it's more like progressivism, and they have the ear of conservatives. i hear it's not your father's republican party anymore. it's a populist party that tends towards -- >> here's my help, joe, i understand what you're saying, my hope is that populism and u.s. competitiveness come together. >> they're oxymoroxymorons, are they. >> not. not oxymorons.

chinese tvs -- 100%. >> what if we do it better here? >> it's hard to do it 30% better. >> do you think we're cutting corporate taxes -- what would you prefer? ♪ >> i would probably like to see them stay -- i think we were pretty competitive already. >> you saw what the j & j guy said yesterday. >> we need to figure out ways to pay for it it's sort of alice in wonderland to think you can lower rates on everybody and somehow it's going to make up for things. i think we all agree, it doesn't. you also, by the way, have to deal with the spending side which nobody wants to talk about. but you need to do both. it's all of the above. not one or the other. >> what is president trump going to ask? what gets us back to real

growth, real wage growth and low inflation? those are the objectives. >> i agree those are the objectives. having said that, i do think it's fair to say, if you look over the years at which party for better or worse has been more responsible around the debt and definite kits, the last years, you would actually argue, i know covid came into it that the democrats did a better job than republicans did. you may disagree with that but that's -- >> no, we just went from 100% to 120% debt to gdp under the bind. >> yeah. >> when jd vance is in the debate, who is it going to be with? >> when he's in -- >> like, who's going to be the vice president that nominee that he debates? >> not kamala harris. >> who? >> wes moore. >> interesting. >> jay clayton with a bold call this morning.

>> you have the answer. >> once in a while, i've got to do it. >> stepping out. stepping out. >> like our other guests. coming up, a preview of netflix quarterly results, plus the "financial times" reporting that warner brothers considering splitting its plan in digital streaming in studio business from its legacy, tv networks, we'll speak to tom rodgers about both of those companies, "squawk box" will be right back.

coming up a preview of netflix films expected after the bell today. and later, minnesota congressman tom emmer lloiwi jn us live from the republican national convention. "squawk box" will be right back.

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netflix is expected to report quarterly results joining, tom roger, gaming executive chairman, "newsweek" editor-at-large. and cnbc contributor. they may get a bump because h "hillbilly elegy" is up 10%. that going to help? >> i not sure that any one program is going to help. it goes to original programming which everybody thinks was the key to netflix success means a lot less these days.

two years ago, 42% or so of the top 100 streaming shows were originals. now, it's down to about 20%. and the top-20 shows, nine of those 20 are network shows, netflix shows, licensed from others. on a nonexclusive basis, with only one original from netflix in that top-20. so there's been a bit of a shift. and so, an older movie like that, coming back into the forefront, not unusual, given what netflix is doing on the programming front these days. >> we're back to this streaming world. there's netflix and then there's everybody else. everybody -- even some disney, saying they're making some moves to look more like netflix. to try to make the streaming business as profitable or as much of a core asset as it is at

netflix. is anyone else going to be able to do it? or is it just, you know, going to continue to bleed money for everybody else? >> well, netflix is certainly widening the gap because they have the global scale which has given them the ability to have substantial cash flow now being generated from that scale. which gives them every ability to reinvest in programming and, you know, they had 92 original seasons of programming for the quarter. you look at disney plus and it has mid-teens in terms of original new seasons. and they can go from that, and really keep churning well. which is really hurting the legacy media company streaming services. netflix churn is under 2%. the average for the other streaming services is about 5.5% which is really high. and the cost of bringing those

subscribers in, having them churn that quickly really hurts the economics. but there is another player on the scene which is a real trend here, and that's youtube. youtube to the tv -- i'm not talking about to the phone -- to the tv now commands about 10% of streaming audience overall television time. with netflix at about 8% of overall television views. and when you start thinking about advertising with both netflix and all of the other players are now increasingly after in the streaming world. and this has been a challenge for netflix, you're talking about youtube having 2 billion eyeballs around the world to be able to monetize advertising. and in may, netflix indicated they were up to 40 million. so netflix has a real challenge on its hands with the advertising piece. >> 2 billion eyeballs, 1 billion people or 2 billion people, just

so i know? >> the overall, when you're not just counting connected tv, it's 2 billion people. >> 2 billion people. okay. 4 billion eyeballs. it is -- >> just to be -- >> precise. just one more. then you can go. what -- when netflix reports, what could cause netflix to jump 3%? and what would cause a selloff? in what they're saying now, you know, how many subscribers they're adding, and whether it's international, i don't know, whether it's some financial metric, what would be really good? what would be really bad? >> well, you know, netflix all up in trades on its sub-number which is obviously important. >> is it going to be good? >> i think they'll probably overperform the consensus of 4.5 million. i would expect them to do better than that. anything in the advertisingtier

which is, as i said, they reported having 40 million users, they're getting into sports, pro, live sports now. because there's nothing like sports to drive viewership. i think a big number in growth, on the advertising tier would certainly send things going. >> you want to weigh in on warner brothers/discovery, exactly, and what you think that kind of -- i don't know if it's a splitup, breakup, asset sale, how you would do it? what you would do, something is on the table here. >> well, i'm not sure i'd put too much weight on the that consideration right now. i think warner has a lot of options in front of it. everybody points to its debt, but, its best asset in some ways is that that debt is very long term, goes out 14, 15 years the very low interest rates. so they're not facing a debt

crunch of some kind. obviously, the company isn't going to stay in its current form. i think splitting off the linear is interesting. but i think you got to focus more on the streaming side. and what's going to create growth there. and it's got real options. >> okay. >> what max/hbo has that paramount plus and peacock don't have is more of an international global franchise. and i think we're really at a point that streaming success is going to be a function of how global you are. so, i wouldn't be surprised to see some move, that would in some way drives the consolidation on the streaming front, among legacy medial players. >> all right. tom. >> becky, who took their eye out -- it could be less than 4 billion, probably, too? >> if you want to count numbers, count emmys, emmy nominations. >> okay. so it would be less than that, probably, tom, thank you. i really wanted to know when you

said 2 billion. it could be 2 billion people -- >> tom, thank you, sir. as always, when we come back a lot more on "squawk box." president biden unveiling a plan to cap rent hikes but will it help shield families from hnflation. jof ford is going to be here. and yes, he's going to weigh in on one hand or the other. we'll come right back. dude, youk 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?

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box." president biden this week proposing a 5.5 -- is it a way to shield the working class families from inflation or government overreach? the question of the morning and jon fortt is here to weigh in. what do you think? >> hey, andrew. government overreach. i understand bringing families relief from soaring shelter costs but this isn't the way to do it. in fact, probably make things worse. here's the situation. the president asked congress to pass legislation that would strip tax advantages from certain planned lords who raise rent more than 5% in the year.

the rule wouldn't apply to all landlords just those who own more than 50 united nations. on the face sounds good. part of the inflation vice squeezing working-class families. government intervention in free markets tends to have bad consequences. red caps weaken a landlord's incentive to fix up properties and fail to account for factors like the higher costs of insurance and natural changes in desirability of neighborhoods. rents aren't high because landlords of greedy. high because covid stimulus pumped into the economy raise costs, and locked prospective first-time home buyers out of the market because sellers won't sell pushing prices up. rents more affordable, incentivize for affordable quality rentals. don't do price caps. >> sounds good on paper in some regard, but you know, in the real world there are families, as you know, forced to move when their rents spike.

what happens, and it's not because the property is getting a major makeover. so how do you account for that? >> well, andrew, "on the other hand" -- this cap on rent increases right now makes perfect sense. first of all affects only corporate planned lords more than 50 units. those owners shoe have resources to plan ahead. exception for new construction and substantial renovation or rehabilitation. framing it at a bridge while new policies also incentivize building more affordable housing on public land and incentivizing neighborhood revitalization. think of it like the circuit breaker rules for s&p 5 hadn't pause trading of 0 stock moves 10% in five minutes. people don't have much day-to-day wealth in stock sudden 20% rent increase is the absolute worst kind of market volatility. the unintended consequence underinvestment and maintenance is where the freedom market comes in. government incentivized new construction will take share from landlords who don't

maintain properties. strained by the cap motivating corporate landlards to make significant improvements justifying rent increases beyond the cap or sell the property to someone who will. >> you have to have an actual opinion on this? i don't think you believe that -- >> what about cnbc. no way a price control ever doesn't cause dislocations in the market that somehow has adverse consequences. >> i'm also a landlord. also a renter. >> you don't have 50. not impacting you. >> really what are you thinking? >> i think rent caps are a bad idea. i do. >> this might be the first time in "on the other hand" history that he has broken. he has broken. >> also to throw us off, did it first. i noticed -- b.s. in here.

>> thinking for you, joe. i knew. >> change hands because you didn't change your hand this time. >> know what? it's in my pocket. i forgot it. two things i normally don't do. i know we-of-i have a pen in my pocket and i know -- >> you are, "on the other hand," i will give you a spot. >> another one? >> no -- well, yeah. give mine. give you a spot in the 8:00 a.m. if you go do it now. >> all right. not this time. >> today. >> i've broken enough rules for one 7:00 a.m. on a thursday. but here -- here's one i won't break. newsletter. take out your phone. scan that with the little camera on it. take you to, sign up for the newsletter that way or type in cnbc.com/otoh for the full text of both of these arguments and share. arguments to be made on both sides. >> you made it. just didn't believe it. >> yeah.

coming up -- >> parts of it. >> if it's only $55, it's okay. i don't now about that 5% thing. i like the $55 thing. a.i., don't -- change the medical field. a new study by dr. scott gottlieb showing the ctg ihapts a.i.'s top doctor. detailing s after the break. we'll be right back. daughter: (gasps) what the?! daughter: alright. dad: side to side. when you work with someone who knows a lot and cares even more... you can do this. ...you're unstoppable. (♪♪) wow... are you kidding me? you can do this. at truist, we believe the same is true for banking. this is our future, ma. godaddy airo. creates a logo, website, even social posts... in minutes! -how? -a.i. (impressed) ay i like it!

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all right. welcome back, everybody. chatgpt is the top-performing doctor. in a new study conduct and five a.i. language bots scoring 98% on the same 50 questions doctors have to answer to get a medical licence beating gemini, grok and huggingchat/llama. joining us with more dr. scott gottlieb, former fda commissioner and a cnbc contributor. doctor gottlieb, i have to say i learned a lot reading through your article now posted on this. i think the thing i learned that shocked me the most is that doctors only have to get a 60% to basically get a passing grade on this. >> yeah. the average score is 75% in all of these large language models passed the medical licensing

exam. we fed 50 questions from the step three medical licensing exam. a third in a three-part series of exams doctors take. typically you take step three in first year of residency. it's the final step before getting your medical licence. we sent 50 questions from this exam. top five large language models. expecting more separation. quite frankly wasn't expect them to do well as they did. we wanted to do this a lot of consumers and physicians are using these large language models to answer medical questions. there wasn't good evidence which were better. studies looking at individual models mostly chatgpt, but no one compared the-of-across the different models. results were striking to me. the fact chatgpt got a near perfect score. the other thing chatgpt was able to do contextualize responses. didn't just give you the answer, explained why it chose that particular answer and why it didn't choose other answers. very descriptive and gave a lot of good information. >> i have been googling my

medical symptoms for years, and scaring the heck out of myself, convincing myself i have everything wrong with me under the sun. are you telling me that chatgpt will be better at that or more of the same, because i am clearly just somebody who worries way too much about things? >> look, i think the large language models are certainly better than using open-source search techniques like google that provide richer information more descriptive information and references if you ask them. some language models didn't look at perplexity specifically but there will certainly provide links to sources of information, but chatgpt did the same thing. llama did that. grok was doing that. providing links back to the source of information so you're able to go back and look at a richer data set. >> i mean, how is that any different, though? i'm pretty good googling this

stuff. i look back to find, you know, hard journals that come from scientific places that i really trust. how are they better at this than what google already does, if i'm, a practiced user of google and knows which references i want to keep? >> if you use the, if you just use general search you have to put the information together for yourself. one of the things you can do with large english models, i've done it. put in a series of symptoms and lab results and risk adjust the probable etiologists are. the model doss that and do it reasonably good job. i've put in lab results, extensive lab results quite perplexing and the models were able to give a pretty good differential ddiagnosis. that's how to use the models in a more effective way than just searching. >> a lot different than a basic consumer kind of using these things trying to figure it out. you're a doctor.

you are putting in lab results. real things. not just symptoms though. i have a headache. i must have a tumor. putting in lab results saying why would you get these things? is this a tool doctors will be able to use to come up with more complex settings, more complex diagnoses than they would be maybe without it? >> yeah. in a broader differential diagnosis. key in medicine coming up with a list what the probable causes are given a certain set of symptoms. the models do a good job of that. mutt in a lot of hypothetical theories to test the models. they're pretty good. you have to be mindful of the models are instructed not to give medical advice. smells too much like you're asking for a personal medical advice putting in personal symptoms it sometimes they balk and tell you go see a doctor. engineer around that tell the model this is a hypothetical patient on a medical exam and seems to get around, their

default settings. something to be watchful for when using things. >> are you saying this is a better tool for consumers or really going to be more useful for medical professionals who already have a broad understanding, which maybe gets hem to a rare diagnosis they wouldn't have thought of otherwise? >> yeah. i think both. i think positionhysicians can u. not to generate a treatment plan to follow. in terms coming up with what possible etiologist would be really good. consumer, a better tool than searching. you don't have a base medical knowledgedept at searching you can go down a rob rob -- rabbit hole reading the wrong information. put in a good compilation what, what symptoms your luooking to search or diseases to generate information on, these models provide a much more focused answe

answer. >> scott, about out of time. quickly, the idea the more information you have the better it is. would you agree putting stuff like reddit and tweets from x and all different kinds of things is better, or do you think sticking to medical journals and, you know, maybe other scientific-based things is a better way of going about it? what would you rather see as physician? >> for medical applications stick to authoritative information. certainly for regulatory purposes. these things, when they become medical devices and see clearances for use cases like actual politicians in patient care, fda will regulate them based on the information they're trained on. >> makes sense. dr. gottlieb, thank you. great to see you. >> thanks. just after 8:00 a.m. on the east coast and you are watching "squawk box" right here on cnbc. i'm becky quick an with joe kernen and andrew ross sorkin. among today's top stories private equity jind blackstone missing top and bottom line expectations in its second quarter earnings report.

inside details on the quarter from fred jon gray. that's coming up in a few minutes. the stock right now down by about 1.75%. earnings on tap an the bell from netflix. new subscribers numbers in focus especially after they blew away expectations last quarter. and film producer jeffrey katzenberg, a top advisor to president biden's re-election campaign, warning the president that donors could soon stop opening their wallets. according to the semiforesaid the warning came when he met privately with katzenberg in las vegas. responding to the story, a "misread of a private meeting." >> meantime i want to get over to dom chu with a look at this morning's pre-market movers. good morning, dom. >> good morning, andrew, joe, becky. start off with the epicenter of yesterday's ted-led market selloff and check on hardest-hit chip stocks. a bit of a bounceback this

morning. helped in large part by shares of taiwan semi up by 1.5%. u.s. listed shares, again, north of 1% now. reporting earnings overnight in asia. top expectations profits and revenues helped along by continued robust demand for high-end computing chipping for things like artificial intelligence applications. helping sentiment in some of the hardest-hit chip stocks yesterday. asml, nvidia up, broadcom up and etf up 1.25% as well. from tech to financials. keep an eye on bank stocks. especially big money center banks. analysts at wells fargo presented positive commentary on the big stocks thinking it's an inflection point to see better revenue and improvements to operating leverage over a multiyear cycle. top pick is citi group, they call their dominant number one pick alongside bank of america and jpmorgan chase. keep an eye on those stocks. seeing fractional gains and

losses. those and other top analyst calls head to cnbc.com for detail and analysis there. cap off with big earnings story. big drop in dominoes currently down almost 12%. pizza chain reporting better than expected profits in-line with estimates. sales growth, same-store sales below estimates as consumer deal with higher inflation. joe, domino's down 12%. i know. i remember in the past you're a fan of the pizza. just wanted to put that out there for you. >> i like the brooklyn crust. >> new york style. had it. my kids like it. >> it's good. not quite at thick. j.t. is in the lead. second, scott mcneeley's son. >> yes. maverick. i saw maverick. second appearance in the other championship. >> quite a player. so is scott, actually. thanks, dom. final day of the republican

national convention, eamon javers joins us once more from milwaukee. eamon, good morning. >> good morning, joe. a big night for j.d. vance last night. the ohio senator having an opportunity to introduce himself to a national audience. now that he is the vice presidential running mate of donald trump. j.d. vance taking to the stage last night, breaking in a way with decades of republican tradition on the economy by taking on big business and wall street. what he said on big business. >> we need a leader who's not in the pocket of big business, but answers to the working man, union and non-union alike. [ applause ] a leader who won't sell out to multi-national corporations but will stand up for american companies and american industry. >> and you heard that reference by j.d. vance to union workers. that's part of a deliberate shift here towards a populist

economic approach which reaches out to those rank and file union workers. achlt the populist conservatives i've talked to, guys, see unions as gettable for the trump-vance ticket thinking union leaders will be liberals for joe biden but union members not. talking positively about unioning and union membership might get more of that vote eating into one of the democratic party's traditional strengths. another rhetorical shift here on the question of wall street. what j.d. vance said there. >> the absurd costs of housing is the result of so many failures, and it reveals so much about what's broken in washington. wall street bearear barons cras the economy. lack of good jobs led to stagnant wages. >> and, guys, of course, president trump, former president trump, will be speaking to the republican

national convention here in milwaukee tonight. just talked briefly with lara trump. the co-chair of the republican national convention. i asked what to expect from that address tonight. she said that we're going to hear a different side of donald trump tonight. i asked what that meant. a little softer, guys. rhetorical shift maybe coming from the former president of the united states tonight as well. >> it's a topsy-turvy world. really is, eamon. i can't help but laugh in some ways. it's just -- fair is foul, foul is fair. a lot of wall street titans are democrats. always been democrats. and now i'm seeing -- now you are seeing silicon valley titans, they're always democrats and some of them are now republicans and j.d. vance talking, republicans talking about the union guys. it's weird. tlr >> a very deliberate shift to a group of conservative populist votes who see the republican party as the party of what they call down-scale america.

right? against up-scale america. base of country against elites. corporate elites on the ride side of that equation. >> okay. thanks, eamon. figure it out in the next -- i have five seconds. i don't think we can figure it out. when we come back, blackstone president jon gray talking about private equity, co qrtsenduaer earnings. do not go anywhere. you're watching "squawk box" on cnbc.

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.

welcome back to "squawk box." futures on the dow. down 70. after -- being up yesterday. nasdaq up 95. s&p down yesterday. after being down yesterday, and i guess we've got eventually, get the ecb out with its latest monetary decision. >> waiting on this european central bank out with that decision leaving rates unchanged as expected. take a look at the euro now you see it is down just slightly.

0.06 of 1%. blackstone out with its second quarter results a short while ago missing profits and revenue forecasts but realized $s 40 billion inflows and $34 billion in the quarter. highest level of invest activity in two years making a big bet on real estate. bottom a couple months ago. new numbers and the economy bring in blackstone presidents an chief operating operator jon gray. jon, nice to see you, sir. >> nice to be here, andrew. >> so help us with this. you did say you thought the real estate business bottomed out and you would shift into buying mode. when do you think things really are and how does the real estate piece of your business match up with everything else? >> well, andrew, great to be with you. i'm going to start a little bit on the quarter overall, because you hit on it. for us it was a strong quarter, because we see a bunch of

positive forwardy indicators. the biggest one is this deployment of capital, including what we committed to. more than $53 billion. we invested that capital, because we wanted to invest before the all-clear sign. talk about real estate in other areas, before the fed cuts rate you want to put money in the ground and that's what we're doing. we're also benefiting as the markets heal here a bit, and as you said. more than nearly $40 billion of inflows. we've been doing some of this in our favorite sectors like artificial intelligence, infrastructure, power. what we see happening in india and private credit. on real estate specifically, we said at the beginning of the year on our fourth quarter call, we said we thought things were clearing. it was a better environment really with the exception of office, which had real headwinds, and we said it because we thought cost of capital was coming down.

bar borrowing courts coming down. markets reopening. easier to access capital. that gave us a lot of confidence, and we've seen since then property prices stabilize. you start to move up a bit, and as you said. we deployed a bunch of capital around that. and as investors, i think the challenge is, when the news is bad, from things that happened in the past, you really have to separate that and look forward, and on the ground cost to capital coming down. fundamentals were stable. less new supply. all of that gave us confidence. what we did after the financial crisis, and we're doing it again now, and we feel very good about that for our firm. >> what is the house view, then, about interest rates, and when the fed might move, given you're trying to get ahead effectively of that move? >> what i would say is, the inflation data is very constructive for the fed. their medicine is working. when we surveyed our enormous

number of portfolio companies every quarter we ask them a bunch of questions. one of the questions we ask them is, how difficult is it to hire workers? and this quarter it was the least difficult. it's been going back to the first quarter of '21. we asked them what do you think about wages a year out? they said this quarter they think it's going to be about 3.25%. lowest that's been in a number of years. so the labor market is certainly cooling. wage pressure's coming off. that helps the fed. the other thing we'd say going back to real estate, shelter costs are much lower than what's in the fed data. that's going to come down as well. so i think the picture may not be a straight line down on inflation, but i think the fed's going to continue to get pretty good numbers. that will allow them to reduce interest rates, and, of course, that's helpful for the economy. and it's particularly helpful for our business in terms of what it means for valuations.

>> what do you think of where we are in the cycle in terms of your ability and, by the way, your peers' ability, to exit investments? you know very well, pension funds especially in the united states have not gotten any money back from many of the private equity firms in the business. so they're out of cash to keep putting a lot of new money in. it's getting harder and harder and harder. the question is, when do you think there's a turn so there can be some meaningful exits? >> well, i think you have to step back and think about the cycle. what's happened here, of course, is in response to inflation, the fed took the cost to capital from zero to 5.5%. and that created a shock to the system. so we saw m & a volumes fall 60%. ipo volumes fall 90-plus percent, and now, as markets normalize, as inflation comes

down, as the ten-year treasury comes down, as debt markets come down, borrowing costs get easier, the ipo market should get a little bit better. you'll start to see realizations pick up, and that's what we've begun to see in our secondaries business, when we're a massive investor in other people's funds's in this quarter we saw 30% increase in distributions. now, off of a low base. so i think it's a matter of time. if you think about it as a cycle, in this early part of the cycle of the capital market's recovery you try to deploy a bunch of capital against this. as things normalize you begin to take out assets through ipos and sales. that starts to look better. as i think about our firm, if the current market environment continues to strengthen, we're still early in mid-24, but a year like 2025 could be robust for sales activity. >> can you speak to the questions i think that the

markets still have around the reit product. we watched what happens with the starwood products. in your same space. i know you think your product effectively is different, but there were a bunch of outflows at one point. folks trying to get out. where are you now? >> well, we could not be more proud of what it's done for investors. started 7.5 years ago. we've delivered more than 10% annually to our customers. more than double the public market in reits over that period of time. and we've given liquidity to all investors who sought it. so the semiliquid model has really worked. it's worked, because we focused in the right years. wherematters. huge concentrations in rental housing, in logistics, student housing in particular. the fastest growing data center business in the world inside of

breit. focusing in florida, texas, ga ga georgia. it's all working. redemptions have come way down. down 85% from the peak. there was a spike after starwood changed their distribution model. we have no plans to change our distribution model. they've now come down from that 50%, and we're seeing this month redemptions coming down again month-to-date. really, it's about, do you deliver on your propositions for investors? what we've been doing as a firm for 40 years. do we deliver strong performance? do we deliver on the liquidity and structure? and so far all of that is working quite well. >> jon, help clear up one thing. a valuation around the reit. questions about it. a story about a month ago that

bloomberg put out. you had sold one of the student housing businesses to kkr, and it was right before your earnings and something that was used and touted to say, look, valuations are at the -- you know, selling these assets at above the levels of the, the nav, if you will, however in this particular case it appears when you did that deal you also provided financing at potentially below market rates to kkr and the buyers. so some people looked at that and said, well, what is the valuation? are they actually getting the same valuations that they're saying that the entire breit structure to be getting? >> the good news is, we have sold 750 individual properties and some debt securities, $25 billion of asset sales, above our march. that was the only transaction

where we used a bit of seller financing. it was $200 million. that note obviously has value, even if it's a little less than face, but a modest amount in the scheme of the enormous amount of assets we've sold, and it just shows we have incredibly vigorous valuation process and now hoe important it is for investors when they're transacting are around the nav, we deliver asset pricing, what it is. and able to deliver this and do it above the marks is because of the rigor of that valuation process. we could not feel better about that. >> jon, finally, i know your politics and steve schwartz' and other politics inside blackstone are very, very different. curious as you look at this election that's coming up, how dig an impact do you think it would ultimate have on the economy, and if you want to take sides, you can. >> i'm not going to take sides, but i'd say about we both share

a passion for america. may have slightly different political views but both want to see this country win. in terms of the impact on the election, what's going to happen. right now obviously it's leaning red. if that happened, there would be some impact on the regulatory environment. certainly would look different on antitrust, which has an impact only our business in terms of m & a activity. >> you've heard j.d. vance's comments? he likes lina khan? >> you know, i can't speak specifically, but i can say, it feels like reading the materials where president trump sits that the overall bias would be towards transactions activity, having less regulatory scrutiny. maybe a little more difference in the tech area specifically, but i also think we'd see a difference in energy. more drilling, more hydrocarbons, maybe less subsidies for green energy. something you have to consider, although there is a very significant shortage of power.

so i think we need both traditional hydrocarbons as well as renewables, and finally, i think tariffs are something we'll have to consider what that means for manufacturing businesses, but i would just say this. for us as a firm we've operated in red environments, blue environments, purple environments and the constant has been delivering great returns for our investors. we think that's the case regardless what happens in the fall. >> jon gray, thank you for joining us. appreciate it. thank you. >> thanks. "squawk box" coming right back after this.

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welcome back to "squawk box." rick santelli here. live at cme hq breaking news of the morning. initial jobless claims in at 243,000. that's definitely elevated from the 230s we were looking for.

follows a slightly revised 223,000. 243,000 equals the first week in june to find a higher number go into the way back machine a bit. august of last year, august of last year. you do remember, last week we had fourth of july. you know, potentially altered thing as bit. holidays thing that the number of days in the surveys. so these are more accurate, and do reflect a bounceback from last week, which probably artificially depressed. continuing claims posted, six. six consecutive. sixth consecutive week above 1.8 million. remains at highest leveling. highest since november of 2021. 1 million 867,000 comps to november '21 when we were 1.8778 million. once again, these numbers are moving up and staying up on continuing claims. now, philly fed survey for july

expecting a positive number. a slight positive number. a bit better than expected at 13.9. just shy of 14. the highest level since april when we were at 15.5. we see that interest rates have moved just a smidge lower on this. we're at 445 in a two year. at 443-ish and move from 417 to 416 on a ten year, which makes it virtually unchanged on the session. i think that the more solid claims is both a bounceback on initial, but represents something we need to pay attention to on continuing claims. especially considering that the jobs number we had was considered golden lauxen goldel. and handicapping the future, difficult. interest rates hovering lows,

hovering basis, close to two year back to february and ten year back to march. of course, we know the dollar index has been getting hit pretty hard. we want to continue to monitor the yen and the ecb as we all looked at this morning. bad after having a cut in june. becky? back to you. >> all right, rick. thank you very much. let's talk a little bit more about the broader market and how the fed is viewing all of this latest data. as officials publicly edge closer to the idea of rate cuts. joining us right now is former fed vice chairman roger ferguson. he's the former president and ceo of tiaa. he's also vice chairman of the business council and a cnbc contributor. roger, we've all kind of assumed at this point, at least the markets have, there is going to about rate cut in september, unless we see startlingly different data between now and then? >> thank you, becky. i think that's probably the right assumption this time.

for the last year or so, as you and i have discussed, the markets have sometimes been ahead of the fed. i think right now there's a much better alignment. as i listen to the fed speak include be importantly chair powell, clearly talking about the dual mandate. signaling an increase in confidence. i, too, believe that a september cut right now seems like the more likely outcome. >> holy cow. stop the presses. roger, first time i've heard you say that, and you've been right every step along the way in this journey. as the former vice chair, you obviously know what you're talking about on these things. so you think that's the case at this point, too. i guess i would point to politics around the edges. i know we've had this conversation again and again how the fed doesn't really consider politics. at this point it'skra

-- kkra crescendo rate. donald trump had an interview with bloomberg this week with a number of the reporters there, and said a lot of different things about jay powell and the fed. first of all, he's inclined to keep chairman powell in that position. but i think the coda that came with this was, assuming that, you know, he kind of does what he thinks is right, and one thing he would not like to see is any cut in interest rates ahead of the election. thinks that would be helping out his competitor in that case. does that have any sort of weight that takes on? and if there's a number, a data point comes out between now and then, really have to hold on because a lot more is riding on it this time around? >> i think a couple of things. first, recognize on the issue of politics history of the fed does not look kindly on former fed chairs who were given anti-political pressure in the past. so i think the institutional culture is to try to drown out

or ignore all of the noise. secondly, recognize that in this case, there's going to be howling on either side. if they cut, they don't cut, someone in the political phase is going to be unhappy nap. that goes to the territory when moving or not closes to an election. you rate a good point. one leads in the other direction, i think unwise to overweight that, given what they've said. feels to me that all of the fedspeak and the numbers coming thuses far are consistent with a first move in september. and i think they'd be, you know, wise to make sure that the data talks as opposed to listening to politicians on either side, ba because they're going to get contradictory measuring and that's just part of the game right now. >> a cut in september. does that think you mean a number of cuts to come, or is it cut, pause, look around.

see what happens next? >> very good question, becky, and we've just seen in the ecb case, for example, a cut and pause. some other banks have cut and i think they're waiting to see what happens. i wouldn't necessarily say this is the start of a reduction campaign. the fed will continue to be data-dependent going forward, but they want to recognize that they don't want to let their rate drift into, you know, more restrictive territory than necessary. and they certainly don't want to risk slowing the economy unnecessarily by holding on to for too long. i'd say one cut and still being data dependent. and wait and see what happens. >> roger, you say it, i believe it. thank you. >> thank you. coming up, what economic insights can investors glean from the bank earnings we got this week? that story next when "squawk box" returns.

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rearview mirror. we want to get to leslie picker. are you sad, leslie, that it's kind of over? or, you know, it's going to happen again in three months. i can just tell you that.

so not to worry. >> that's my consolation prize, joe. i know you're sad, too. >> i mean does it show? you're right. what, with it -- now that we've seen everything, what did we learn about, let's say, the u.s. economy, consumers, et cetera? >> yeah. honestly, joe, the banks are all right. major concerns about credit quality amid last year's regional bank turmoil and historic rise in interest rates they not playing out so far. the q2 earnings from the biggest banks suggests their weathering this economy just fine and in ways actually even thriving. average quarter return on tangible equity amongst this cohort among the best quarterly performance in at least a year. rote is a measure of profitability and efficiency. the broader higher rates seems to be turning a corner. declining percentage of banks are tightening lending standards. you can see there in that graph right there.

the charge operate on commercial real estate loans levelling off. one bank credit hash fund manager we spoke with said the backdrop is conducive for bank upside. >> it's like the opposite of what we had from 2011 to 2020. and that dynamic is at higher interest rates, the economy's growing. inflation is a little high. so nominal rates stay high, and the banks churn out massive profit. i think there's every reason to think that's going to be what happens. i don't really see another scenario. absent a crazy change in stock. >> to be sure, credit delinquency is trending higher, although they, too, appear to be stabilizing recently. however, bank of america ceo brian moynihan said the copt rate structure is much higher than the fed needs suggesting

there may still be some lag effects that have yet to play out, andrew. >> okay. thank you for that. when we come back, house majority whip tom emmer from -- joining us from the republican national convention where j.d. vance lit up the crowd last night and rm psintrufoerrede tmp is going to be speaking this evening. we're coming right back, after this. ng rich is knowing what counts.

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ohio senator j.d. vance accepting the republican vice presidential nomination last night. former president trump accepting the nomination tonight. the former president said he rewrote his speech following the assassination attempt last weekend. joining us now from the rnc, congressman tom emmer of minnesota. the house majority whip, spoke at the rnc on tuesday night. good to see you again. we've seen you on before, congressman and we welcome you back today. thank you. >> thank you. good to be with you.

>> i know -- i didn't take -- didn't take it to heart but i know your daughter said, wow. dad, everybody's so old here, and maybe that -- and i'm not -- you know, not that i resemble that remark, but j.d. vance is not old. he's young. you call him a -- that's fine. a marine, and what a story. as we learn more and more about that. if people haven't seen, you know, the movie or read the book, but a champion of conservative values, you called him that, and can you expound on that? and just try to explain some of the contradictions that we may have seen in his speech? or what is it -- what kind of conservative do you call that? it's not a neocon. is it a populist con conservative? it's different. there are things that classic

conservatives would sort of shrink away from, in what we hear from j.d. vance? >> yeah. i don't think so. i mean if you're talking about classical liberals which really are the conservatives, were the conservatives, this is what he is. i'll leave that to the intellectual elite and to the journalism world to try to define what he is, who he is. what he is doing is talking to a problem that has existed in this country for 30 years plus. he's talking to the forgotten men and women that built this country. and he's got a connection to them like no one else. and he can articulate, articulate it better than anyone else. i thought j.d. did a great job. my eyebrows went up when you said "contradictions." i don't buy it. he was consistent and direct and simplified this thing to the very people that are going to decide this election. j.d. vance is the right guy at the right time.

i think he did a great job. >> what would be the best way to help, i guess it's, you know, the devil's in the details. what's the best way to help the american worker? is it, do you think to raise corporate taxes, or is it to cut corporate taxes? because that is definitely -- that's not funny. it's kind of a -- there are people that think that j.d. vance would support raising corporate taxes. an organization called american compass. that that's the way to do it. is that the way to do it? >> i'll leave all of guys to say is it this, is it that. it's a lot more complicated. >> which do you want to do? would you, yourself, vote to raise corporate be taxes to 28%? >> absolutely not. and i don't think j.d. would be supportive of that either, but that's the -- that's what people do is try to pick apart little pieces. what j.d. told us last night is

we've got to start thinking about working men and women first. we have not been thinking about them first. the washington elite, the power folks in washington for years have been thinking about themselves. he said, we're going to go after wall street. make sure that we're working fo people. it's such a refreshing message that it's going to resonate all across this country. >> does that mean more regulations on wall street? do you think that wall street has played a role in supplying the capital and innovation and engine for capitalism in the united states? or do you think wall street's just a bunch of fat cats, you know, trading, you know -- moving money around and taking their cut? this is -- formally, would be something you'd hear from elizabeth warren, and he actually has worked with senator warren. he's worked -- it is funny. i find it funny, but he's worked -- >> it's laughable. >> why did he do it, then, if

it's laughable? >> no, you're trying to equate two things, apples and oranges. elizabeth warren, that's the wrong example. and the idea that one group needs to be attacked over another group, that's the other problem. stop trying to divide us. we've got the greatest financial markets in the world. the reason that we want this type of leadership is because they are going to be expansive and inclusive. this isn't just going to be about one part of the economy. it's going to be about the entire economy, and more importantly, it's going to be about the people who build the economy. they come first. not the political elites, not this democrat party that's gone off the darn cliff on the left. jd vance is talking to the midwest. he's talking to the people in detroit who build cars. he's talking to the people in my state who make things and export. he's talking to regular americans, and keep in mind, in

this country right now, if you were above the line, the poverty line, you don't feel 20% inflation. you don't feel the extra thousand bucks that you're paying every month to support yourself, but if you're below that line, you feel it. and you feel it in big ways. and people have to understand -- >> there are contradictions between populism and reaganomics, and we can talk antitrust, something -- in the past -- you know why the democrats have always had a lock on the unions. you know how that's worked. it's -- and i'm not saying unions are bad one way or the other, but this is a different type of approach than what we've seen from the republican party, and it does -- some of the components look like progressivism, and i guess my question is, is donald trump going to continue with the way his policies from last time, which are more -- he's not always conservative, obviously, tariffs were not necessarily in

the playbook before. but do you think jd vance will have his ear on, for example, raising corporate taxes? >> look, when you -- when you make -- when you try to delve into the academics, i'm going to leave that for the professors. i'm going to leave that for the intellectual elites in this country. >> these are legislation topics. >> i'm going to say to you again, this -- you can call him whatever you want. he's talking to people who matter and who have not been listened to for years. the arrogance of the democratic party is one of the reasons why donald j. trump and jd vance are going to be elected on november 5th. they haven't been listening to main street america for years. they've been telling main street america, oh, look at what we're doing. it's good for you. it's not. and people are smarter than that, and that's why this thing is turning -- and jd talked to them last night. he did a great job. >> democrats have been talking to the same people for years, and i don't think that people were -- i don't think they

benefitted from what the democrats said they were going to do either, so talking about it is one thing, but what actually happens is the devil's in the details and that's why it's not -- >> we got proof from the last trump administration. >> okay. >> that was just the beginning. uf unfortunately, it ended too quick. >> yeah, covid did it. all right, congressman. preaching to the choir. just trying to -- we're all trying to understand exactly what we're looking at here, but we appreciate it. >> i appreciate it. >> thank you. when we come back, we will go inside the recent tech selloff with deep water's gene munster. bringing you an elevated experience, tailor-made for trader minds. ♪♪ go deeper with thinkorswim: our award-wining trading platforms ♪♪ unlock support from the schwab trade desk— our team of passionate traders who live and breathe trading. ♪♪ and sharpen your skills with an immersive online education

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welcome back to "squawk box." the rotation out of tech flaring again. joining us right now, gene munster, deepwater asset management managing partner. just a correction? something worse? something more? how do you think about it? >> andrew, i still think we're in the third inning of this a.i. boom and just look for the recent piece of evidence, tmc results this morning, revenue up 40% year over year compared to up 17% in the march quarter,

flat in the december '23 quarter, so the fundamentals look really good. i want to just quickly talk about this pullback from its peak on july 10th, nasdaq is down just about 4%. if we look back at the dot com boom from, let's call it, '94 through '99, that's six years, there were 11 times when the market traded down more than 10%, average of 14%. one time down 28% in 1998. it is normal when the market is so strong for investors to get near-term nervous about some events, yesterday being commentary from trump and biden around regulation and treatment of taiwan. but at the end of the day, the fundamentals are going to power a.i. they're much more powerful than politics, and i'm still very bullish that we're in a three to five-year bull market. >> is that still a chip story to you, or do you think there's a software side to it too? >> software side is predominantly going to play out, i think, in the earlier in the private companies, the companies

obviously like openai, xai. we're investors in a company called invisible, which does model training. these companies are growing hundreds of percent per year. eventually, the a.i. theme will pull up software, but i think the darlings of a.i. software are in the private space. good news for public investors. they will likely ipo in the next two to three years, so i think they'll get a shot at that apple. >> ipo not bought, by the way, because the other big question, of course, is whether -- if trump wins, do you think the regulatory environment allows for some very, very big deals? >> i was just tuned into your earlier segment. yes, i think that it's getting to be progressively difficult for these big tech companies to buy. that's why google is one of our holdings in our titan portfolio, best position relative to a.i. >> gene, i want to thank you for joining us this morning. appreciate it. >> thank you. i want to take a quick final check on the markets before we hand it over to our friends on "squawk on the street." take a quick look at where things stand right now.

dow off about 96 points, nasdaq up about 145 point, the s&p 500 up about 16 points, and most importantly of the day, we need to wish a very special happy birthday to the birthday girl at the table at the center of your screen. happy birthday. >> almost made it out of here. >> so close. >> almost made it. >> so close. >> happy, happy birthday. >> yeah, happy birthday. >> have a great day, and join us tomorrow. "squawk on the street" begins right now. ♪ good thursday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer and david faber at post nine of the new york stock exchange. futures do indicate some reversal from nasdaq's drubbing yesterday. worst session in a year and a half, worst day for semis since covid. tsm guidance is helping a bit. netflix, tonight. ecb holds steady. our road map begins with market rotation after a new dow milestone. the nasdaq selloff, of course, and the russell pulling back from a 52-week high. also ahead, the chip sector is looking to